Doctor, I need to tell you why I am lying on the couch today. In my line of work, as you know, I report on public-private deals for California's most distinguished land-use newsletter. And, for the most part, I perform my job without major psychic distress or disturbance (except for occasional bouts of rage when I learn that redevelopment agencies have declared open fields of wildflowers to be "blighted" in order to build power centers.) But something has happened recently. I heard that the City of Oakland took the very unusual step of accepting stock warrants from a technology company in partial payment for a piece of land. The topic seemed so good, so right for a chest-thumping Deals column. But for days I have been unable to write. Each time I think about Oakland's deal, I think about ... about ... (I am almost too embarrassed to say it) ... Olivia Newton-John doing the sexy dance in that skin-tight, black leather outfit at the end of "Grease." Hold on, doctor. It's not what you think. The symbolism runs deep. Oakland's deal, like Olivia's outfit, is provocative: The city has sold 14.5 acres near the Oakland Airport to Zhone Technologies Inc., a telecommunications start-up, to build a 300,000-square-foot plant on the site. For this site, Zhone (pronounced "zone") paid $6 million, plus 100,000 warrants. (A warrant gives the holder the right to buy shares in a stock company at some future time.) Zhone, which was founded less than a year ago, expects to go public sometime in the near future, but the date has not been fixed. Although a number of real estate developers and landlords have been willing to accept stock in lieu of rent, Oakland is the first city to accept equity in a company as payment in a real estate transaction, according to Frank Fanelli, the city's real estate manager, who negotiated the Zhone deal. Doctor, somehow I feel I am being manipulated. I feel like the City of Oakland is trying to get a rise out of me. The calculated reaction, of course, is for everyone to roll their eyes and say sober and respectable things like, "the Public Interest is too important to play dice with," or "Cities should not put taxpayers at risk by gambling on the overheated stock market." Why, the very idea of accepting stock warrants for publicly owned land sounds as reckless — as insane — as investing our Social Security savings in the stock market. (I'm not making a political statement, doc. I know that you put your Roth IRA into a high-tech mutual fund, and that you now have more money than Ed McMahon.) Oakland's Fanelli told me that he is proud of this transaction. "We have a lot of horsepower and creativity here to think outside the box," he said in an interview. "It was quite novel for a public agency to try and act like a private entrepreneur." He even invited other companies to make similar offers to Oakland: "The city is open for business. Bring us a deal we can't refuse." Now, a close examination suggests that this deal is actually very tame and very safe — especially compared with a typical Marks-Roos bond deal, which is based entirely on speculation. The Oakland property is part of a 22-acre parcel that the city bought from the Port of Oakland for about $9 million, or roughly $9.39 per square foot. According to my Texas Instruments calculator, Zhone paid about $9.50 per square foot for its parcel, so the city already has recovered its costs. Offering the land at cost is perfectly acceptable, of course, if the goal was to attract an employer who would provide 1,300 high-paying jobs, as Zhone plans. As for the warrants, they are gravy. If the city makes money, that is great. If the warrants turn out to be worthless, however, City Hall workers will not be forced to sell their office furniture at a lawn sale. And unlike the parade of dot-coms that are currently crashing in front of our eyes, Zhone may just hit pay dirt. The company was founded by the top executives of Ascend, which was purchased last year by Lucent Technologies for about $24 billion. Not yet a year old, the new company has already attracted $500 million in seed money from high powered investment outfits such as Kohlberg Kravis Roberts & Co., Texas Pacific Group and New Enterprise Associates. At this point in my reporting, doc, it hit me: Oakland is showing off! It wants to exclaim to the world how au courant and techno-hip it is. And why does Oakland need to show off? Well, doc, I'm a little bit of an amateur shrink myself, and I have a theory. The city has an inferiority complex. Oakland is one of the last Bay Area cities to reap the benefits of the computer and Internet revolutions. Oakland has become tired of being viewed as the Camden of Northern California, a city of industry, urban grit and crime. Oakland wanted to do something to get itself noticed — something other than electing a wacky ex-governor as mayor or spending tens of millions of dollars on a bad football team. The whole thing reminds me of Olivia in Grease. Remember the picture, doc? In the beginning, she is a plain girl in a plain dress. She is not cool or flashy. She makes a number of ill-fated attempts (here symbolizing Jerry Brown's election and the Raiders' deal) to draw the attention of John Travolta. But she appears hopelessly unable to make Travolta (symbolizing the high-tech and dot-com sector) pay attention to her. Then, in the movie's finale, she appears in that smashing outfit (again, symbolizing the Zhone lease). She is hotter, more flamboyant, than any other girl. John Travolta at last pays attention to her, and soon the pair is dancing energetically. Success and happiness abound. Now, doctor, I am fixated. I know I should be writing about Oakland's strong assets in transportation, its affordable real estate, its bay frontage and the city's investment in downtown. But whenever I think of that flashy warrant deal, I find myself unable to write. I just can't get the picture of that dancing woman out of my mind. Can you help me, doc? Can you? Doctor F (after a pause): "Explain one thing, if you would, please. These warrants ... are they still available?"