Bayer HealthCare LLC, or Bayer, a global pharmaceutical company, presented a 30-year development agreement for a facility within 3 miles of Downtown Berkeley to Berkeley’s Zoning Adjustments Board on Thursday.
Authorized in 1992, Bayer’s existing agreement with the city will expire in February 2022, but Thursday’s proposal would push that deadline past 2050.
City planner Shannon Allen said discussions about the extension will continue into the foreseeable future with Berkeley City Council possibly taking action in November.
In its application to the city, Bayer said it has spent almost $1 billion on its Berkeley facilities since 2000. Over the years, the property has been used to develop treatments for hemophilia, a medical condition that impairs the body’s ability to form blood clots.
If granted, the company would use the development agreement to expand its current operations, the application reads. In its 30-year plan, Bayer expects to use less space while improving its facilities, constructing new labs within an area 165,000 square feet smaller than currently permitted.
During Thursday’s meeting, Jeff Bellisario, the executive director of the Bay Area Council Economic Institute, noted that having Bayer stay in Berkeley would help the city recover economically from the COVID-19 pandemic.
“For every job created on the Berkeley campus, the wages and the capital expenditure money and the suppliers and vendors are creating another job outside of that campus somewhere within our region,” Bellisario said.
He also mentioned that based on Bayer salaries in 2019, many of the new jobs created by the agreement would pay more than $65,000 annually while being available to people without a bachelor’s degree.
However, Drew Johnston, the vice president of site engineering for Bayer’s Berkeley operations, reiterated the importance of a commitment from the city.
With Bayer having factories, labs and alternative sites across the globe, Johnston explained that it is critical that Berkeley agrees to the conditions stipulated by the company if it wants its business.
“Berkeley and the Bay Area in general has a lot to offer; however, without the predictability, it is tough to compete with some of those other options,” Johnston said.
In addition to jobs, Johnston noted that Bayer is willing to continue its “community benefits” program, an initiative that was created in the original 1992 agreement.
As part of the development extension, the company would initially pay Berkeley $720,000 annually, scaling up to more than $1 million by the end of the contract. Johnston said there is not a lot of room for Bayer to increase the amount paid, but the city can decide how the money gets spent.
“We like being in Berkeley,” Johnston said. “We like to thrive with the community and know these benefits are useful.”