Staff is recommending that the Planning Commission forward Nishi to the Davis City Council for certification of the project Environmental Impact Report (EIR) and project applications at its meeting this week.
The Nishi project is a mixed-used development with 650 residential units including 440 rental apartments, 325,000 square feet of R&D space, 20,000 in retail and 19 acres of open space along with a hotel that is a conditionally-permitted use, subject to subsequent review and market analysis.
There are a number of critical issues that have come up that need to be addressed going forward.
In the staff report, concerns presented by Dr. Thomas Cahill were addressed at length. In an article the Vanguard ran in November, Dr. Cahill previously testified, “If the Planning Commission should decide to support the Nishi proposal, the threats from air pollution (diesel and ultra-fine metals) are so grave that it should be modified to eliminate all residential housing.”
While the Draft EIR “acknowledges the health risks associated with Toxic Air Contaminants and placing residential uses and other sensitive receptors near freeways and major roadways” it notes, “The location and pattern of the proposed MTP/SCS [Metropolitan Transportation Plan/Sustainable Communities Strategy] growth is important, because it impacts travel behavior and provides a means to determine the impact of future vehicle emissions in the proposed plan area. A compact growth pattern served by an efficient and diverse transportation system provides the foundation to reduce automotive travel and increase walking, bicycling, and transit use all of which reduce individual vehicle trips and associated VMT [Vehicle Miles Traveled]. Reduced VMT and vehicle trips are directly linked.”
The DEIR further notes that “in order to achieve the greatest VMT reductions from a compact growth pattern, development also must necessarily be in close proximity to public transit and freeway and major roadway corridors.”
Staff concludes that, while the air quality conditions are “determined to be significant and unavoidable,” they “do not represent air quality conditions that are unique or within which residences throughout the state do not or cannot exist.”
Some have expressed concern with fiscal analysis that showed the project ending up at a $78,000 net deficit. However, the developer believes that, with a hotel, they can get into the positive. According to the city’s consultant, the Nishi project alternative that includes a hotel will generate a general fund surplus of $416,000 per year, money that can be redirected to vital city services.
However, there are questions about “the ability of the Davis market to absorb all the proposed additional rooms.” Council has already approved a hotel conference facility on Richards and staff notes “entitlement applications were submitted for two extended-stay hotels: one on Cowell Boulevard in south Davis, and one on 2nd Street in Mace Ranch.”
Both proposals would require approval of council.
Staff notes, “Staff and the City Council have raised the question of the market’s ability to absorb all proposed hotel rooms, and are seeking to have a game plan for evaluation of the various proposals to maximize consistency with City Council goals to facilitate development of a hotel conference center, ensure fiscal resilience, develop a diverse economy, and improve downtown as a destination.”
The city has contracted with HVS Hotel Management Contract Survey, a hotel consulting firm, to evaluate the proposals and the potential for the Davis market to absorb new rooms. Staff reports that they are hoping to bring preliminary conclusions to the city council in February.
Staff notes, “The HVS analysis is not evaluating the hotel proposed as part of the Mace Ranch Innovation Center concept.”
The staff report notes that the city has contracted with Andy Plescia and Associates for an analysis of the economics and development feasibility for the Nishi property, as they did for Cannery. The analysis “concluded that the proposed project had a gap of approximately $9 million between anticipated infrastructure costs and the amount that could be supported by the development cost, primarily due to the cost of the roadway connections.”
It is believed that the gap “could be closed through mechanisms such as a Community Facilities District or other infrastructure financing tool.”
Staff writes the draft Development Agreement reflects the following commitments of the city and the developer.
It includes the following stipulations:
- The Developer has a vested right to develop the property in accordance with the entitlements and the Baseline Project Features.
- Commitment to the SIP [Sustainability Implementation Plan] and specific to sustainability features, including 4.9 MW PV or equivalent, 10 percent reduction in parking, and building performance exceeding 30 percent better than 2013 Title 24 requirements.
- Development on the Nishi property cannot go forward without UC Davis commitment to the grade-separated crossing to the UC Davis campus.
- A Transportation Management and Phasing Plan tied to improvements on Olive Drive, the Richards Boulevard corridor, and the Richards Interchange. No buildings would be allowed to be occupied until Richards Interchange improvements are completed.
- Agricultural mitigation will be provided in accordance with the Agricultural Protection Ordinance.
- Developer commitment to a net fiscal positive general fund impact, even without a hotel.
- Developer reimbursement of City pre-development costs under the cost-sharing agreement.
Staff notes that the Development Agreement “also establishes the Baseline Project Features required by Chapter 41 of the Davis Municipal Code. If the project is approved, these Baseline Project Features cannot be removed or significantly modified without subsequent voter approval.”
But these baseline features have not been established.
Moreover, staff writes, “There are components of the Development Agreement that will not be known at the time of City Council action on the applications. This is a factor of both the timeline required to allow the City Council the ability to place the General Plan Amendment on the June 2016 ballot for voter consideration, and a desire to know whether the project is approvable before expending the effort to resolve all remaining issues.”
Staff anticipates the Development Agreement to have placeholders or re-openers reflecting:
- Specific details of Community Facilities Districts or other financing mechanisms.
- Development impact fee and community enhancement contributions, fee calculations and credits, and financial commitments to infrastructure improvements.
- Specific locations for agricultural mitigation, Compliance will be verified at the time the mitigation land is identified for preservation, which would be required prior to any construction or conversion of the Nishi property.
- Completion of tax-sharing negotiations with Yolo County.
- Water and sewer connection obligations and charges.
Staff is recommending approval of the application despite the fact that there is no concrete agreement at this time with UC Davis on access issue. Moreover, while there are stipulations that the buildings cannot be commenced until the Richards Interchange Improvements are complete, the traffic analysis of Richards for the Hotel Conference Center is being legally challenged.
Ultimately, Nishi as a Measure R project will go before the voters, perhaps as soon as June, but will the voters approve a project with traffic analysis, roadway impacts and even university access up in the air? Those may not be questions for the Planning Commission specifically, but they certainly loom large over the larger issue.
—David M. Greenwald reporting