Council Pulls Plug on Housing Option at MRIC

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Mace Ranch Innovation Center
Internal View of Mace Ranch Innovation Center

While Dan Ramos and his team made a strong push for consideration of a mixed-use housing proposal on the proposed 218-acre Mace Ranch Innovation Center site, there was a lot of pushback from the community on the idea of adding housing to the mix. City staff made it clear that consideration of housing would be a heavy lift to get on a November ballot.

In the spring of 2014, the city put out an RFEI (Request for Expressions of Interest) for innovation parks, which included a provision that there be no housing on the project site. Mace Ranch, one of three respondents, put forth a proposal for 2.5 million square feet of R&D (research and development) space with no housing component.

However, during the CEQA (California Environmental Quality Act) process, staff and council asked the proponent to put in a mixed-use alternative, which they were reluctant to include at first. However, as Dan Ramos explained, their examination of other parks came to the conclusion that housing was an important component to provide living space for employees and reduce the impact of traffic and vehicle miles traveled (VMT).

They asked council to consider allowing them to go forward with a mixed-use project.

In the end, only Mayor Pro Tem Robb Davis was willing to ask the developers to come forward with a formal proposal for a mixed-use project. The other four members of the council were adamantly opposed to the option, and so Robb Davis moved that the staff proceed with the current proposal with no housing.

Councilmember Rochelle Swanson said, “Intellectually, mixed use can make sense.” She added, “For most communities I do believe it is a necessity.” But she said, “We’re in Davis and we’re very uniquely positioned on a global scale… we have to have a Davis DNA Innovation Park.”

For Councilmember Swanson, the key consideration was making sure that this project could pass and, quite simply, she did not believe a project with housing could pass.

She made the point that it is not just the developer who bears the cost in this process. “Who bears the cost if this doesn’t pass, (it) is $2.2 million fiscal annually… a net $6 million potentially and a one-time $10 million fee,” she said. “It’s not hyperbole, if this doesn’t pass in November, I’m going to be a big cheerleader to bring back a really big parcel tax, either that or we’re going to start closing things.”

“That’s not being a scare tactic, that’s being real,” she said. “We have a huge infrastructure problem. We need organic revenue. It’s why I agreed to run for council in the first place and why I agreed to run for a second term.”

She said that a mixed-use project would grade as a “A,” without it is a “B” but “with no project it’s an F.” She added, “I really do see why the mixed use can work well… I just don’t think in this time frame, the November 2016 vote, I don’t think that this community will pass it.”

Councilmember Rochelle Swanson concluded that, while she thinks the mixed-use project would be best, there are other ways to address housing and vehicles miles traveled, and “at the end of the day I do think we have to look at the big picture… I really think that it’s important that we put a ballot measure out there that will pass and be successful.  Because I feel very strongly that if we put something on the ballot like this and it fails, that fails a lot more to our community than just this one project.”

Mayor Pro Tem Robb Davis noted that the council in the Measure R environment faces “a bit of a puzzle,” in that do they bring forward the best project that they can or do they bring forward a project that can pass? “What do we do if there’s a conflict between those?” he asked.

For Robb Davis, the city of Davis is “already in a housing crisis,” and “that crisis isn’t going to get better anytime soon.” He added that “we’re going to add a lot of jobs.” He said, “I do have a concern about where some of the people (are going to live).”

At the same time, he noted that there is no proposal on the table for mixed use. “This staff works on a basis of project proposals, we need proposals,” he said. “We don’t have a proposal on the table.”

He suggested that if the project proponents want to have a November vote, then the staff needs to process the project on the table. However, “if you want a mixed use, then bring us a proposal.”

The conversation never got much further, however, as it became clear that Robb Davis was alone in wanting to consider a mixed-use proposal.

Councilmember Brett Lee said, “I respectfully disagree with Robb… I think the council has sufficient information to know whether we are supportive of housing on the site or not.” He said that having the project applicants put forward a housing proposal would require “a fair amount of time, energy and money to prepare that.”

He said, “I’ll just say it, I’m not in favor of housing on that site.” Instead, he thinks the focus for housing should be in the center of Davis where we centralize housing to the community and focus on densification.

Councilmember Lee did acknowledge that “the applicant has made a pretty good case for this idea that the better designed innovation centers do have a mixed-use component.” However, “specific to the city of Davis, I am not in favor of a mixed-use component for this proposal.”

Councilmember Lucas Frerichs stated, “I’m not in favor of mixed use at the Mace Ranch site and have been consistent on that for a long time.” He noted the long public process that led to the development of the dispersed innovation strategy.

He stated, “I think that the proposal to now head in the direction of a mixed-use option at the Mace Ranch Innovation Center asks us to consider an option which is not even officially on the table.” He continued, “I think that the inclusion of housing… dilutes the effectiveness of the city’s dispersed economic development strategy.”

He added that it wastes potential revenue-generating business space. “Frankly,” he said, “I think it threatens the electoral success of not only the Mace Ranch Innovation Center but very possibly any future innovation park plans.”

Councilmember Frerichs believes that, without housing, the project offers the opportunity to create new jobs and expand the workforce. The focus for several years has been on the need to diversify revenue making for the city’s many needs.

He reiterated that he has consistently been opposed to a mixed-use component at the MRIC, saying, “I’m really concerned about the situation that we’re in, that the perfect being the enemy of the good with mixed-use housing versus innovation park without housing which I think will endanger the success of the project overall – the potential that the park itself would fail.” He said, “That’s a gamble at this point that I’m not willing to make.”

Mayor Dan Wolk, seeing the writing on the wall, added that he was skeptical at first, “but I think there are a lot of strong arguments for the housing.” Like the others, he saw the politics as a hindrance to the consideration of housing. “I get at the same time the political calculation,” he stated.

Based on this discussion, Robb Davis moved that staff proceed with the current project proposal and MRIC go forward for consideration without housing. Rochelle Swanson seconded it and the motion eventually passed unanimously.

—David M. Greenwald reporting

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About The Author

David Greenwald is the founder, editor, and executive director of the Davis Vanguard. He founded the Vanguard in 2006. David Greenwald moved to Davis in 1996 to attend Graduate School at UC Davis in Political Science. He lives in South Davis with his wife Cecilia Escamilla Greenwald and three children.

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100 thoughts on “Council Pulls Plug on Housing Option at MRIC”

  1. Misanthrop

    They voted down the housing not because it wasn’t a good idea but because they didn’t think it could pass at the polls proving once again that Measure R is a failure.

    1. Jim Frame

      proving once again that Measure R is a failure

      To me this demonstrates that Measure R is a success, in that when the CC chooses to make land use decisions that aren’t aligned with the desires of the electorate, those decisions will be vetoed.

      1. Barack Palin

        ^^^^DITTO^^^^

        What’s wrong with the people having a say in how our city is developed?  After all we’re are the ones living here who will be most impacted by any projects.

        1. David Greenwald Post author

          I completely support Measure R, however, I think Misathrop has a point. To a person, the councilmembers with the possible exception of Brett, felt that the project could be or would be better with housing, but they didn’t want to risk the measure failing and therefore are going forward with what they think is an inferior project.

        2. Matt Williams

          David, the point you and Misanthrop make would be correct if there were no other available sites for housing, but that is not the case.  One of the great strengths of the Vanguard is the breadth of perspective that comes from the various posters, and the wealth of information they bring to the conversations.  During the MRIC housing discussions it was pointed out (I believe by CalAg, but I could be wrong on that) that there are a number of currently available housing sites close by MRIC.  One of them is the 44-acre Mariani property inside the Mace Curve.  Another is the 6 acre property on the northwest  corner of the Alhambra and Mace intersection.  A third is the 25-acre Wildhorse Ranch property.

          One of my fellow FBC commissioners made an interesting point to me in a late Monday afternoon telephone conversation.  Specifically, that even if housing were approved for MRIC, the developer’s discussions to date appeared to indicate that Phase One of the project would not include any housing.  Without any actual proposal on the table, it was impossible to know if that would be the final gameplan, but the discussions pointed that way.  So, his argument was “Why rush a housing decision when all we have is theoretical housing demand?”   He then went on to make the point that the development of Phase One and the marketing of Phase Two to Innovation companies would provide the developer and the community with real information about real housing demand.  Armed with that real information, the community could then look at its housing options.   The Inside the Mace Curve property is zoned Agriculture, so it and Wildhorse Ranch would be subject to a Measure R vote. He argued that armed with real information about real demand from their tenants and prospective tenants, the MRIC developers might actually bring forward a Measure R plan of their own.

          1. David Greenwald Post author

            Matt: I preferred further inquiry into whether this was a better approach and electorally viable. However, after talking with Rochelle Swanson following the meeting, I really came to agree with her. That said, my point was and remains, that the decision was more about electoral calculation than it was the best project. The points that you are making are good but they don’t really undercut that point that Misanthrop makes. People will read this as supportive of housing, whereas in reality I am joining your call for more evidence-based decision making.

        3. Matt Williams

          The other factor that clearly came into play last night was timing.   Because a complete and accurate analysis of the fiscal impact of MRIC with a housing component is currently not available, and won’t be possible until an actual proposal is received by the city, a November ballot date for MRIC with housing was in serious jeopardy.

          The Council members last night clearly said that MRIC with housing might be “better” on paper whenever that paper actually arrived, but that a MRIC Measure R vote delayed beyond November 2016 was “not better.”  With the possible exception of Robb, what they were saying was that the timing of the “not better” wiped out the possibility of “better on paper” in this case.

        4. The Pugilist

          Timing is a strange concept here.  I mean we are talking about a vote that is at least eight months away.  We should’ve used some of that time for a better understanding of the benefits and the voter preferences.  The council is capitulating to the loudest voices in the room.

        5. Misanthrop

          “The other factor that clearly came into play last night was timing.”

          This is a second problem with Measure R, projects are being evaluated based on the electoral calendar instead of the analysis required to get the best possible project.

          In the case of Nishi the vote to put it on the June ballot was done despite calls for more traffic analysis.

          For MRIC an honest study of the merits of housing was precluded by the desire to get it on the November ballot.

          A delay of Nishi might put two proposals on the same ballot and fear of a Measure R rejection of a ballot with too many projects on it foreclosed that possibility.

          It all adds up to Measure R resulting in bad planning.

      2. Mark West

        “To me this demonstrates that Measure R is a success”

        Measure R is a success for those who favor mob rule and has been a particular success for the anti-development contingent in town. It has been an absolute failure for those who prefer good planning and smart development. We should be looking to create the best projects that optimize land use while addressing the City’s needs for business and residential growth. Measure R is just a blunt instrument designed to frustrate all development and has changed the calculus from creating the best projects to accepting those that are considered politically possible.

        1. Mark West

          Under-informed voters are no different than a mob, more responsive to emotion and less so to rational discussions of facts. That is exactly what the anti-development faction needs, a populace that responds to their emotional pleas on ‘quality of life’ impacts rather than the rational ones on how we manage growth and also ‘pay our bills.’

          What percentage of the voters in Davis are qualified City Planners? What percentage pay close enough attention to the details to make rational, rather than emotional, decisions on development projects? We have a representative form of government for the very reason that most voters do not have the time to understand all of the details of each issue. We elect a City Council to be responsible for those details and to oversee the professional staff responsible for carrying out the decisions. Measure R negates our representative government and replaces it with an under-informed and often irrational mob.

        2. Barack Palin

          Council voted to pass the Cannery and there’s many that thought and still think that they dropped the ball on that for many reasons.  If a Measure R vote was involved in the Cannery project it might have resulted in a better development.

    2. Alan Miller

      They voted down the housing not because it wasn’t a good idea but because they didn’t think it could pass at the polls proving once again that Measure R is a failure.

      I’ll second that reality.

  2. Barack Palin

    It’s the right decision and will now pass a Measure R vote.   If we have future innovation parks still in the mix I would advise the council and any developers to come forward from the beginning that they want housing on the site, not present a plan just to try and change it down the road.

    1. The Pugilist

      I’m not so sure.  A lot of the people whaling the most last night and elsewhere have been opposed to most projects in town.  Will they hold their nose and vote for it?  Maybe.

      1. Dave Hart

        Sorry, but I can’t resist:  while there may be a large contingent in Davis who are active in killing marine mammals and opposed to any facility that processes whale meat, I must remind everyone that wailing about what bothers one most is the duty of every citizen.

  3. Don Shor

    He continued, “I think that the inclusion of housing… dilutes the effectiveness of the city’s dispersed economic development strategy.”

    He added that it wastes potential revenue-generating business space. “Frankly,” he said, “I think it threatens the electoral success of not only the Mace Ranch Innovation Center but very possibly any future innovation park plans.”

    I couldn’t have said it better myself.

  4. Matt Williams

    One thing that this Council decision did was make this Monday’s meeting of the Open Space and Habitat Commission much more interesting.  Based on the OSHC commissioners’ questions and input in their first MRIC meeting three weeks ago, the following topics should all be very active.

    — preservation of open space,

    — denser footprint,

    — building up rather than building out,

    — phasing of parking decisions so that parking can be more vertically matched to actual tenants rather than horizontally spread

    — preservation of the eastbound Covell Blvd viewscape of the Sacramento skyline

    — integration of a Center for Land Based Learning complex into the project

    — ag land mitigation

     

    1. Barack Palin

      preservation of the eastbound Covell Blvd viewscape of the Sacramento skyline

      With the orchards that have been planted in the last few months it won’t be long before that view is gone.

      1. Matt Williams

        To get a sense of how tall those new Mace 366 trees are likely to be after pruning, drive west on Russell along the north edge of West Village, and then look at the blooming trees to the south on the UCD land just before Patwin Road turns off to the left.

  5. Frankly

    I’m not a fan of Measure R because I don’t have faith in the voting public to be educated enough to make accurate decisions on complex issues related to the city development needs.

    I don’t see this correct decision by the CC to be an endorsement of Measure R.  Even a broken clock is right twice a day.

    In this case the right decision just happened to align with the NIMBY, change-averse, no-growth voters.  That will happen sometimes.

    This is not even a “perfection is the enemy of the good” lesson.   Putting housing in the innovation park would have made the innovation park less perfect from the perspective that Davis is not short of housing development over the last 40 years… it is short of commercial space.

    Yes, the housing shortage is the result of UCD growth… but only because Davis has also grown in population over the years.   If you build housing and that housing is consumed by people that want to live in Davis, you can always claim a housing shortage.   There is demand elasticity with Davis housing… if we build 100 units because we are 100 units short due to UCD growth, we will maybe be 80 units short after they are built, because there is an existing demand for 80 units for people that just want to live here.   You cannot hold the housing exclusive for the employees of the innovation park, and you cannot hold city housing exclusive for the students.  So we must factor in that existing pent-up demand.

    Housing gets the press because it directly impacts more people.

    But the lack of commercial space is a BIG problem in this city that fewer people understand.

    We are at risk of losing more and more of our local companies… including retail… because they are either growing or being priced out of their space.  And there is really nowhere for them to go.

    The few commercial lots that exist are owned by people that know that the demand far exceed the demand and they play games with that land.  For example, I am aware of one beloved downtown business that needs to move and got the city to pre-approve a slight zoning exception with a lot they would make an offer on.   The land-owner hearing about the exception pulled the lot from sale demanding that the city grant HIM the same zoning exception because it increased the value of his lot.

    These games are played because Davis lacks commercial space.  The land-owners and the landlords have complete leverage and many of them jack around our local business owners and prospective new businesses.

    40 years ago when our population was less than half what it is today we had less commercial acreage than any other comparable city.  We were expecting live off the soft money of the university.

    And over that next 40 years we developed significant new housing and all of it was consumed by the demand that exceeded the supply.  However, we did not develop much new commercial space.  We rejected peripheral retail.  We rejected peripheral industrial.

    Consequently the ratio of population to commercial space grew to the point where the local Davis economy became too small to support our city budget needs.

    We need more housing primarily because the demand to live in Davis is high.  To build enough housing to counter that demand would mean Davis would quickly grow to 100,000 residents or more.

    We need more commercial development because we have failed to build enough and because our local economy is way too small for our population size and budget needs.

    The CC got this right but not because of Measure R…

     

    1. Matt Williams

      Frankly said . . . “We are at risk of losing more and more of our local companies… including retail… because they are either growing or being priced out of their space.  And there is really nowhere for them to go.”

      Frankly, in the non-retail commercial sector, I agree with you.  However, in the retail sector, not so much.  What retail business is Davis losing because that retail business is growing?  I can’t think of a single one.  With the exception of the retail grocery segment and possibly Davis Ace, because of the shrinking demographics of the portion of our population that buys the lions share of retail products, most Davis retailers are experiencing significant revenue pressures.  I would argue that those downward revenue trends are even more important than “being priced out of their space” pressures.  Rental prices are less important to a retail business than rental location.  Most Davis retail business have the location they want, and would gladly pay the somewhat higher rental rates that those locations command IF their revenues weren’t shrinking, but unfortunately fewer people in the 25-54 age bracket means fewer potential customers, and fewer customers means fewer revenues.

       

      1. Frankly

        We are losing retail because the rents of our measly commercial retail supply are going up.  A pizza restaurant that converts to a night club becomes the new tenant because the business model for a pizza restaurant that converts to a nigh club is the only retail business model that can support those higher rents.

        1. Matt Williams

          Compared to other cities, our retail space rents are not overly high.  You regularly cite Palo Alto as a comparative city.  How do Davis retail rents per square foot compare to Palo Alto?  Santa Rosa?  San Luis Obispo?  Alameda? Berkeley?  Walnut Creek?

          I suspect that Davis will be somewhere around the median of those cities … perhaps even below the median.  The problem is that Davis is almost surely at the very bottom of all those cities in dollars of retail sales per square foot.

          Your restaurant and night club examples are both services, not retail.  Services businesses are not constrained impacted by the demographics shift.  Most services serve all the demographic groups.  Retail, not so much.  I doubt you can cite a retail example.

        2. wdf1

          Frankly:  Why did Deluna’s close?  What do you think will come in to replace them in that space?

          Also the retail clothing store across the street from De Luna’s on the NE corner of the 2nd & E intersection closed down recently.  Other stores in the Brinley buildings will also be affected soon, including Watermelon Music.  See this.

        3. Frankly

          In terms of retail lease availability, Loopnet has 14 listings for Davis and 29 listings for Palo Alto.

          However two of the Davis listings are for property yet to be developed: The Cannery and the Alhambra Center (not approved yet).  One is for the the 3 Target Center pads.  About 50% 0f the properties are restaurants are used to be restaurants.  One is for the Monticello property.

          Most of the Davis properties are listed as Negotiable Rate (not surprising given the lack of competition).  However, one at 737 Russel Blvd (next to Subway in University Mall) is listed at $37.52 per sq ft per year.  It is about 3000 sq ft.   There is not a good match in the Palo Alto list, but an example smaller 1,295 sq ft restaurant in a strip mall close to campus is $45 per sq ft per year.  That is materially the same given a smaller place will tend to command a higher per sq ft cost.  My general sense is that Palo Alto commercial retail is 10-15% higher than Davis… but commands a much bigger retail customer base with all those employees.

          Now with the Target pads, the commercial space at the Cannery… and Nishi and MRIC assuming they are approved, Davis will have a healthy supply of commercial properties including retail.  Not sure about the Alhambra Center project.  I assume that will come up on the CC agenda at some point.

          But today, if you are a retail business that needs to start or move, your choices are limited and expensive for Davis.

        4. Frankly

          Other stores in the Brinley buildings will also be affected soon, including Watermelon Music.

          Yup.

          And they are having a very had time finding a suitable alternative location in Davis.

      1. Frankly

        My point is that we will never build enough housing to meet the demand.  We should build housing at 1-2% per year.  And if you look at over the last 40 years we have done that plus some.  However, in the last 15 years we have stalled a bit.  So I am open to front-loading some housing development to “catch-up” but not at the expense of meeting or commercial development needs… which are in a severe deficit.

        If we build housing at 1-2% per year, then we are doing enough.  If the university wants to grow by 2-3% every year, they will need to build at least as much housing as Davis to keep up with the need.

  6. Michael Harrington

    I walked out of the CC meeting after that 5/0 vote, dejected.  They didn’t put housing in.  Makes our job harder.  The opposition is winnable, but an easy win is always preferred.

    1. Frankly

      Thanks for being frank and honest.

      You wanted housing because you believed it would guaranty a Measure R vote failure.  Now it is a long-shot for you to stir up enough stuff to cause enough voters to oppose it.  Do I have that right?

      I think you should not waste time on opposing the MRIC.  Just check the VG… many of the people that tend to agree with your no-growth, no-development position are in favor of MRIC as a complete commercial project.

    2. CalAg

      Without housing – MRIC should now win its Measure R vote.

      This assumes that Ramos doesn’t try another stunt (he’s sitting at strike two after first trying to get a Measure R exemption and then the housing bait-and-switch). If he plays this straight down the middle, my opinion is that enough of his initial base of support will come back home and it won’t matter if Harrington’s mischief metastasizes to MRIC.

      1. hpierce

        You assume it was a “developer stunt”…. am thinking it was the City planning staff that generated the ‘push’… might be wrong, but I generally ‘trust my gut’…

      2. Matt Williams

        CalAg, I realize that your gut tells you otherwise, but I concur with hpierce.

        FWIW, I have personally been on the other side of Dan Ramos maneuverings back in 2006-2007 with respect to The Vineyards at El Macero development.  First hand. That very clearly felt like maneuverings.  This really doesn’t.  Staff,with a lot of help from CEQA, was the “pushing” force. JMO.

      3. CalAg

        Blaming “staff” is the same as blaming no one. Which staff member(s) do you believe was championing the addition of housing to the application? Webb? Brazil? Hess? Steiner? White? Pinkerton?

        1. Matt Williams

          They were following the letter of CEQA Law.  The principal staff members charged with that responsibility were Katherine Hess and  Mike Webb, with active support by the CEQA-expert consultant Heidi Tschudin, who was introduced by Mike Webb to the Council as “The Contract Project Manager for the Innovation Center Applications.”  December 16, 2014 was at the very tail end of Rob White’s tenure, and I would expect that his most active involvement pretty much ended with the RFEI process.  I would be surprised if Harriet didn’t review the December 16, 2014 Staff Report prior to its distribution to Council by Staff.  The video of the December 16, 2014 Council meeting can be viewed at this LINK

        2. CalAg

          No they weren’t. CEQA law does not require that an alternative with housing be analysed in a commercial project – no matter how many times you repeat this canard or post the rationalization given in the staff report.

          You’ve given the well documented names and roles of some of the major players, but have dodged the question of who you think on the staff was driving the housing decision.

        3. Matt Williams

          CalAg, you are dancing on the head of a pin.  CEQA Law very specifically states:

          The California Environmental Quality Act (CEQA) requires analysis of a range of reasonable alternatives to the project, or the location of the project, which would feasibly attain most of the projects basic objectives and avoid or substantially lessen the significant effects of the project.

          As noted by both Brett and Robb in the December 16, 2014 discussion of the item, VMT mitigation is a quite new modification to CEQA.  The question they asked that night and I ask you now is what other alternative can mitigate the impact of the VMTs?  Other than a No Project alternative, there really isn’t an alternative other than providing on site housing.

          So CEQA does not SPECIFICALLY or EXPLICITLY require that an alternative with housing be analysed, but it does mandate that an alternative that mitigates the VMT impact be analysed.

          I’m not sure why it is so important to you to not acknowledge the role that CEQA Law played in the decision.

          If you really want a name (for God knows what reason) the most knowledgeable CEQA expert on the City Staff team was/is Heidi Tschudin, so she was probably the “go to” person when it came to the decision to include the mixed-use alternative, which put housing on the table.  That is my speculation as to whom you should play the “blame” card on. She was/is also the Contract Project Manager for the Innovation Center Applications.

        4. Matt Williams

          That is your prerogative. You clearly have your reasons for your competitive approach to this issue. You are passionate about it. I respect that.  FWIW, I am as dispassionate as you are passionate.   With that said, it probably makes sense to agree to disagree at this time. You have your beliefs and I have mine.

    3. The Pugilist

      “I walked out of the CC meeting after that 5/0 vote, dejected.  They didn’t put housing in.  Makes our job harder.  The opposition is winnable, but an easy win is always preferred.”

      Thanks for lifting my spirits.  I went out of there dejected because we have a worse project than we would have.

  7. Odin

    Grow, grow, grow.  We’ve got the Cannery, Trackside, Lincoln 40, Nishi, and now MRIC.  When I moved here we desired smart, limited growth, now it seems like everything is on the table.  If people want to retain the small town feel of Davis, they better start thinking about how quickly we can lose our character.  There are hundreds of small towns that have lost what used to be.  Woodland is a fine example.  Just look at their downtown.  I’m for Measure R, but worry that folks into will be sold into thinking all this growth is a good thing because it was “smartly” planned.  I’m all for smart growth (The Cannery was a wasteland of concrete that needed fixing anyway), but the rest of the proposed building is unnecessary and not cost efficient.  MRIC should die a slow death like Nishi until someone can really prove why we really need it.

      1. Misanthrop

        Since Odin used the term smart growth I’m going to guess 2001 when the term became popular.

        As for retaining our small town feel, pick a year and tell me when Davis was a better place then today. I will argue that no matter what year you choose you are wrong because in my mind the more students Davis educates the better a place Davis becomes. The more people that live here with good educations, jobs, families who pay taxes that support our community the better. If no growth is what you want there are plenty of communities to choose from. Flint Michigan comes to mind. A healthy community and economy needs some growth. What do we call it when we have no growth? We call it a recession.

        1. Frankly

          Agree.

          Interesting, I have lived here since 74.  I find more of the people that have lived here a long time as being more accepting of growth than are the newbees.

        2. Odin

          Flint, Michigan is a poor comparison.  To see a good indicator of what can happen to Davis, go to Boulder, Colorado.  Nice place, but talk to anyone there and they’ll tell you the city sold out.  The have rampant sprawl and a loss of the sense of community (My family is from there).  You want to see towns that have done things mostly right, I look to Carmel, Sonoma, Arcata, Nevada City as examples of towns that have maintained their character by restricting growth

        3. Tia Will

          Misanthrop

          A healthy community and economy needs some growth. What do we call it when we have no growth? We call it a recession.”

          I know that this is a very popular point of view. I do not believe that it is accurate. A healthy community may be one which is growing, but it may also be one which is in equilibrium. If the population has exceeded the resources of its environment, it may even be healthier when it in decline. This is as true of human populations as it is of many animal populations.

          What do we call it when we have no growth.  Not recession necessarily as this implies decline. Equilibrium implies a state of balance. We do not seem to have a contingent of commenters here on the Vanguard that see this as a viable state.

        4. Misanthrop

          “Flint, Michagan is a poor example”

          Literally.

          I haven’t been to Boulder since Ginsburg was at Naropa and the first Star Wars movie came out but I was in Carmel two weeks ago and saw homes there cost millions of dollars and there is no University.

          Sonoma and Nevada City don’t have major universities either. As for Arcata there are practically no logs or fish left. The economy is totally dependent on marijuana growing. and would be like Flint if it hadn’t gone to pot.

          The reality is that Davis is home to a major land grant university for which there is incredible demand. Standing in the way of that demand is like putting your finger in the dike to stop the flood.

        1. Matt Williams

          1992 UCD enrollment = 22,085

          2015 UCD enrollment = 36,104

          That is the real driver.

          Throw in the faculty and staff increases to support that larger enrollment and, more recently the 2020 Initiative and the driver gets bigger and bigger.

      2. Matt Williams

        Good analogy Tia . . . as far as it goes.  The challenge that our community in equilibrium faces is two fold.  First, the component demographics of the community are not in equilibrium.  Our 55 and over population is growing, but because the majority of that group is retired, and as a result on fixed incomes, which means very little income growth for the city.  Our 20-25 year-old population is growing rapidly, and they are for the most part not paying any local taxes to the city.  Bottom-line, our equilibrium has significantly constrained revenues.  At the same time our community costs are not in equilibrium at all.  They are are affected by a double whammy, fast growth rate and a massive accrued backlog (over $500 million based on an aggregation of staff reports) due to past mismanagement.

        Our equilibrium is elusive.

    1. Don Shor

      MRIC should die a slow death like Nishi until someone can really prove why we really need it.

      To increase revenues to the city and help balance our long term budget shortfalls, allowing the city to catch up on infrastructure and road maintenance that has been deferred for years.

  8. South of Davis

    Matt wrote:

    > because of the shrinking demographics of the portion of our

    > population that buys the lions share of retail products, most

    > Davis retailers are experiencing significant revenue pressures.

    Matt I have read your posts on the changing demographics of Davis and I agree that this is a reason that many retailers are facing “revenue pressures”.  I don’t know about you, but in the almost 20 years since I heard about something called “Amazon” (that had books at great prices) I have bought more and more on line each year.  As an increasing number of people just pull out their smartphones and click a button when they think of something they need I predict we will see sales at traditional retailers (tax revenue for cities) continue to decline over the next 20 years.

    1. Tia Will

      South of Davis

      As an increasing number of people just pull out their smartphones and click a button when they think of something they need I predict we will see sales at traditional retailers (tax revenue for cities) continue to decline over the next 20 years.”

      I completely agree with this point. It was one major reason that I did not favor yet another Target in our region. I rarely set foot in a store, making virtually all of my purchases on line. This is true of my partner, my neighbors, my children and most of the younger doctors and residents with whom I work daily. I think that much of our planning ( like MRIC without the housing component) is the planning of 10 years ago, not the planning for today’s needs and certainly not for the next 20.

    2. Matt Williams

      I agree SoD, which will further diminish the factual basis of Frankly’s assertion that there is a need for additional retail commercial space even more.  I agree with Frankly’s point that Davis needs commercial space, just not retail commercial space.

      FWIW, every time the Trackside Center presentation is given, they play up the value of their first floor retail space, and I wince when they say that Davis needs more retail space.

      1. Mark West

        Matt Williams:  “FWIW, every time the Trackside Center presentation is given, they play up the value of their first floor retail space, and I wince when they say that Davis needs more retail space.”

        Here is a relevant quote from the article that wdf1 linked to above indicating a different perspective on the problem.

        Jeff Simons – Watermelon Music : “The downtown has become so expensive that if the city wants to maintain some of these decades-old businesses, there have to be possibilities for them to lease space, where it’s affordable, and you can still run your business,” Simons said. “And the zoning is pretty tight right now. There are only a few places you can have a retail store.”

        Much of the available commercial space in town is not zoned for retail, which limits our ability to attract new retail businesses to town and limits the options for local businesses to find attractive and viable locations when their rents become too expensive. Expanding options and increasing zoning flexibility will reduce rents and make retail establishments more attractive. Retail remains a vital part of the local economy, and it would be extremely short-sighted to limit the potential for expansion of that sector.

        1. Matt Williams

          Thanks for sharing that Mark and wdf1.   Jeff Simons’ quote actually reinforces my beliefs about the incongruity of Trackside’s playing up their projected retail space.  They referred to it multiple times in the presentation as “Class A Retail” with the very clear implication that the rent per square foot will be “Class A” as well.  When asked what the rents will be for the retail, all they would say was, “Market Rate.”  What Jeff appears to be saying is that the market rate has become so expensive that the businesses can no longer afford it.

        2. Mark West

          Just as with housing…if you want to have affordable rents, you need to increase the supply.  Davis could do that with retail space simply by changing the zoning on available commercial spaces around town.  That alone would increase flexibility for business owners and reduce the upward price pressure on downtown rents.   We have historically restricted retail outside of the core area, which has the effect of subsidizing the downtown property owners with artificially high rents. Time to do what is best for Davis citizens and expand retail options around town, not just in the core.

        3. Matt Williams

          That sounds good in theory, but given the fast growth rate of the number of restaurants in Davis, with no end in sight, I suspect that retail establishments are going to be at a competitive disadvantage in competing for any available supply.

          With that said, what target areas in the city outside the core do you think need to have their zoning code changed so that the artificial/restricted situation you describe can be made more equitable?

        4. Mark West

          “what target areas in the city outside the core do you think need to have their zoning code changed”

          Everywhere!  The default position should be that if a building is zoned commercial, it should also be zoned for retail. There may be reasons why a specific location is not suitable for retail, but that should be the exception, not the rule.

        5. Mark West

          “So am I understanding you correctly, that the only places in downtown that are zoned retail are zoned that way by exception?”

          No Matt.  Downtown is zoned for retail. It is the rest of the town that has the restrictions. In general, retail is restricted to the downtown and the neighborhood centers (with a few exceptions).  The zoning on many of the commercial buildings in town excludes retail.

  9. Misanthrop

    “But the lack of commercial space is a BIG problem in this city that fewer people understand.”

    An interesting article today about how Bayer Crop Sciences, formerly Agra Quest of Davis, is building a $12 million expansion in West Sac. Apparently the 15 acre expansion includes giant greenhouses for R and D. The property taxes on the expansion alone will add $120,000 a year to West Sac’s coffers. Meanwhile Davis is still doing what it does best, arguing about what should go on the ballot under Measure R.
    http://www.sacbee.com/news/local/environment/article62096477.html
     

    1. Jim Frame

      Meanwhile Davis is still doing what it does best, arguing about what should go on the ballot under Measure R.

      The City Council’s decision to move forward with November vote on MRIC is keeping the project on track, belying the notion that we’re arguing instead of acting.

  10. Sam

    Where were the affordable housing advocates? If we keep suppressing the supply of housing, rental prices will continue to increase. It’s funny how individually most people in Davis want more affordable housing for lower income people, but at City Council meetings and at the ballot box (or during polling) they reject actually building more housing keeping prices high. NIMBY

  11. Eileen Samitz

    I am grateful that the City Council took the mixed-use off the table. The reality is that the City has financial problems that it use to fix with massive residential growth for short-term money.  This caused so many problems to our community and in particular, costs to City residents in the long term. We have been talking about an innovation park for more than a decade to help our City have a sustainable revenue source. We need to do something that will help stop the financial bleeding of the City and to not start another massive residential deluge for short-term revenue like that happened in the 80’s and  90’s that nearly ruined Davis. The MRIC project needs to be commercial-only and focus on producing revenue for the City, not generating more costs with 850 housing units.

    1. Tia Will

      Sam

      they reject actually building more housing keeping prices high. NIMBY”

      What your comment neglects to mention is that the majority of projects that are proposed are not intended nor will they in any way help with housing for low income folks. The Cannery certainly is not particularly helpful for low income individuals. Neither is Trackside which was put forward as  “luxury” housing. There are a number of us who will work hard against “luxury developments” that rely on concessions from the city in terms of ignoring design recommendations and zoning, but would not stand in the way of affordable housing.

      1. Sam

        If you increase the supply of housing, no matter what type of housing it is, “luxury” or “non-luxury” rental vacancies will increase. Once vacancies increase rents will soften. Below is a chart from the 90’s. As South Davis was being built up with nice houses and “luxury” apartments vacancies increased & rentsoftened.  

        If you want lower rents increase the supply. If you want higher rents vote down every project that includes any housing development in Davis.

        1. Matt Williams

          Sam, the housing supply/demand curve rules simply don’t function in Davis.  The reason that is true is very clearly provable numerically.  In 2015 the demand for housing in Davis grew by no less than 2,676 beds.  In 2015 the total number of new home building permits was 109 and the total number of new apartment building permits was zero.

          In 2014 the demand for housing in Davis grew by no less than 1,284 beds. In 2014 the total number of new home building permits was approximately the same (109) and again the total number of new apartment building permits was zero.

          There is no way “normal” housing supply/demand rules can simply absorb that kind of pent up 3,500 bed demand … especially given UCD’s announced plan to add 1,500 more students to the Fall.

          Bottom-line, your belief that rental vacancies will increase if Single Family Residential units are built is a pipe dream.

        2. Misanthrop

          Hilarious, Matt Williams thinks supply and demand doesn’t apply to the dynamics of the Davis housing market.

          Sorry Matt, nothing can be farther from the truth. If you build enough and keep building eventually rents go to almost zero. See the regional housing markets post 2006 for what happens when you over build. If you under build while demand increases rents go up. See the Davis housing market today.

          You can argue about what type of housing needs to be built but the reality is that we have not been building enough housing of all types to keep up with demand growth. The answer is to build more and this brings us back to Measure R. Say there are those who like myself don’t like increased density so they join with the anti-growth faction and kill Nishi. Then those who are opposed to peripheral development of housing join with those who are opposed to all growth and kill MRIC if it includes housing. The end result is we end up with a supply shortage and rents increase enriching existing landlords like he who loves to file suit, the Landlord Voldemort of Davis.

        3. Matt Williams

          Reading is fundamental Misanthrop.  The supply/demand curve rules apply in Davis, they simply don’t function because of the massive tsunami of incremental demand that UCD has added in the past two academic years. As I said in my comment, to eliminate the upward price pressures added in those two years, Davis would have to build 3,500 additional beds.  Come September, when UCD adds another incremental 1,500 students to its enrollment, the 3,500 number grows to 5,000.

          So the practical realities of your statement, “If you build enough and keep building eventually rents go to almost zero” are that the chances of that volume of building happening in Davis is the pipe dream I pointed out to Sam.

          Your statement, “If you under build while demand increases rents go up.” is indeed correct.

        4. Sam

          Matt – You missed my point entirely. There are tons of people in Davis like Tia who will protest building a high rise dense building like at the Family First site, then turn around and complain that Davis is unaffordable to low wage workers. Either accept the fact that ten projects that large need to be built every year to drive down rents or just admit that you want Davis not to grow and those with low wages can live elsewhere.

        5. Matt Williams

          Sam said . . . “There are tons of people in Davis like Tia who will protest building a high rise dense building like at the Family First site, then turn around and complain that Davis is unaffordable to low wage workers. Either accept the fact that ten projects that large need to be built every year to drive down rents or just admit that you want Davis not to grow and those with low wages can live elsewhere.”

          The problem with your statement Sam is that it assumes that affordable housing for lower income residents can only be solved through the management/manipulation of sticks and mortar construction. 

          The problem is further complicated by the fact that the vast majority of the 36,000 UCD students qualify for your description of “those with low wages” and yet for the purposes of paying for housing, most of those UCD students have access to the financial resources of their parents.

          You don’t give any consideration to potential solutions like establishing a voucher program to make existing market rate rental units affordable.  Robb Davis laid out his thoughts on such a program at Tuesday night’s Affordable Housing Workshop.  That takes us out of the almost exclusive reliance we currently have on building new units.

    2. Tia Will

      Eileen,

       We need to do something that will help stop the financial bleeding of the City and to not start another massive residential deluge for short-term revenue like that happened in the 80’s and  90’s that nearly ruined Davis.”

      And I would agree with you if I felt that not allowing mixed use at MRIC would prevent this from happening. Unfortunately, I do not see that as the outcome. I believe that MRIC if successful will lead to the pressure for even more housing. The argument will of course go ” Well we have to have more large housing developments so that the workers at MRIC don’t have to commute and have upscale homes right here in our community. More McMansions for all those young affluent families. Then we will have not only what I consider a suboptimal industrial project, but a project that will still drive up the need for housing leaving us with the worst of both worlds.

      1. The Pugilist

        Yes it will lead to more housing pressure.  Some have suggested putting the housing next to Harper inside the Mace Curve.  I’d prefer the integrated housing personally.

      2. Misanthrop

        “ We need to do something that will help stop the financial bleeding of the City and to not start another massive residential deluge for short-term revenue like that happened in the 80’s and  90’s that nearly ruined Davis.”

        Ruined how? Davis is thriving so well we can’t keep up with the infrastructure needed for it to reach its potential.

  12. Mark West

    “We need to do something that will help stop the financial bleeding of the City”

    Yes, cost containment.  No development project will be fiscally sustainable until we control the City’s rate of cost inflation.

    1. noname

      That’s why I laugh at Rochelle Swanson’s threat. She’d have more credibility if she had pulled the city’s labor agreements off the consent calendar. Is all this MRIC-generated revenue really going to protect city “things” or is it just going to pay for ever-increasing employee costs? (I know Robb Davis has a proposal to address a key area of this, but the council isn’t exactly jumping at addressing the long-term problem.)

      1. The Pugilist

        If it’s just $2.2 million, probably not.  If it’s is $6 to $7 million, that’s enough to stop taxing ourselves assuming we do as Mark West says and contain our costs into the future.  As you point out, that’s unlikely.

      2. Barack Palin

        That’s why I laugh at Rochelle Swanson’s threat. 

        “That’s not being a scare tactic, that’s being real,” 

        I agree, she gives away much of the latest sales tax increase to employees then basically threatens us with higher taxes if this doesn’t pass.   It came off as a scare tactic to me.

         

    2. Matt Williams

      Mark is absolutely right.  The FBC has been beating the cost containment drum.  Robb Davis has been beating the cost containment drum.  Rich Rifkin once again beat the cost containment drum in the Enterprise on Sunday (see http://www.davisenterprise.com/forum/opinion-columns/what-voters-in-davis-should-be-paying-attention-to/ ).

      Robb has even laid out a cost containment plan as follows:

      Cost Containment as an Element of Fiscal Resilience

      1a. Undertake a full staffing analysis to determine match between service delivery needs and staffing.

      1b.  FBC discussions have not only embraced a staffing analysis (building on John Meyer’s study last year), but we have also discussed the belief that a thorough Business Process Re-engineering engagement is necessary as well.  Staffing poorly designed, inefficient, ineffective service delivery processes makes no sense.  Einstein said it perfectly, “Insanity: doing the same thing over and over again and expecting different results.”

      2. Based on 1, consider best ways to provide services going forward with focus on (a) training workers to take on multiple tasks (as is happening already) and (b) consideration of targeted and appropriate outsourcing of services.

      3. Examine all means to further reduce growth in compensation costs including analysis of OPEB options (as other CA cities are doing).

      4. Create more transparent and accessible accounting systems that enable a more precise estimation of costs of specific services—building on work done by the Fee Study consultants.

      5. Promote a more aggressive analysis with the County and other cities, via LAFCo, of shared bidding, service, and consulting options to reduce duplication and obtain scale efficiencies.

      6. Determine what current city programs might be candidates for reduction or elimination and which we want/must keep.

      7. Determine what current city infrastructure we could/should shed (buildings, properties) to reduce expenditures related to them.

      Though not a cost containment item, we should also receive an analysis of all non-enterprise fund balances to determine if/how we can use these funds to meet current needs.

      1. Miwok

        Yay! Keeping the Employees trained and learning is important. Replacing them just because they fall behind is to me a fault of management. When all they see is layoffs in their future, they become disinterested especially when they have no stake in the outcome of what they do.

        Through this article and comments I keep flashing back to my experience living in Placer county, Roseville, during a big time of Promises with no performance. HP, NEC, and dozens of others ramped up production and hiring based on expectations the County and city would perform as promised.

        After a few years, HP in particular killed it and with buildings and land purchased, people hired, pulled over 20K people and went to another state. It took fifteen years for the City and Roseville-Rocklin area to get the roads finished and then the boom came. HP only hires assembly line workers now, a year at a time through “contracts”. They have not forgotten.

        So when I compare this to Davis, I see Roads, Infrastructure, barely keeping up, and by deferring and hiding true costs, they are setting themselves up for the same. Stick to the basics and the rest will be easier, than trusting a CC that asks for something then blames the Developer for changing things. Write a Contract that kicks developers to the curb, forever for misleading the City. If the city Attorney is not smart enough to do that, get more attorneys.

  13. The Pugilist

    “Grow, grow, grow.  We’ve got the Cannery, Trackside, Lincoln 40, Nishi, and now MRIC.  ”

    This is different from all of them.  Nishi has basically a Costco sized R&D space.  MRIC provides us with the space to be able to finance the rest of the city.

  14. Eileen Samitz

    Tia,

    The reason for bringing an innovation park was not only to provide revenue for the City but to bring jobs to help correct the jobs housing imbalance. So it brings job for people who live here already. I acknowledge that not all workers will not already be residents of Davis, but no matter what, there will be workers at the innovation center that would not choose to live in Davis.

    The vertical housing they were proposing was not for long term housing for most people so it would just generate the need for more typical housing, which most people prefer to have a small yard for kids, pets, a garden etc. Also, since they cannot mandate who lives there such as MRIC employees only, or how many people live in each unit (potentially 2-3 roommates, or family members who drive but do not work at MRIC) which would generate 2-3 times more vehicle trips. So the project is not greener with housing. Also, there are almost 50 acres right across Mace Blvd. from the MRIC site  where more of a variety of housing could go rather than jamming in 850 vertical apartment-like units in the middle of a research and development park.

    1. The Pugilist

      “The vertical housing they were proposing was not for long term housing for most people so it would just generate the need for more typical housing, which most people prefer to have a small yard for kids, pets, a garden etc. ”

      A lot of people like an urban living environment, especially young people in their 20s.  Since MRIC was only going to house about 15% of the employees, why not have some housing on-site.

      “potentially 2-3 roommates, or family members who drive but do not work at MRIC”

      They housing wasn’t going to be big enough to have two or three roommates.  Have you seen what these houses look like, they are basically studios and lofts.

    2. Tia Will

      Eileen

      which most people prefer to have a small yard for kids, pets, a garden etc. “

      I agree that this has been a typical aspiration for folks in the recent past, and maybe right now it is still a dominant trend. But I do not believe that we are being very forward looking. Having two children in their 20’s and talking to them and their friends, I do not see the same drive to own their own home with the yard or garden that my generation had. I believe the there are many, and will be many more who prefer a loft or apartment or mixed use type life style.

      We are claiming as a community that this is a highly desirable lifestyle for the core area, but then do not seem to be able to extrapolate this game desire to any other setting. Again, I do not believe that we are planning for the future, but are rather satisfied with more of the same. I see this as a strategic mistake. Time will tell.

        1. Matt Williams

          Correct.  Also, one of the advantages of marrying later is that the couple (typically with two incomes) will have saved enough money for a SFR down payment and paid their student loan balances down to zero.  That makes home-ownership a whole lot more practical than it was at the younger age that people used to marry.

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