Monday Morning Thoughts: Creating a City-Driven Planning Process for Economic Development

Mace Ranch Innovation Center
Original MRIC Plan

Right now the way we do development projects is largely driven by developers.  We have a developer who owns or controls a specific piece of land come forward with an application for a project.  It goes through a city approval process whereby the community, the planning commission and ultimately the city council deliberate and weigh in on the project.  If the council approves it and it lies outside the current city limits, it goes to a vote of the people and they get to have the final say.

I will argue that this process is not good for either the citizens or the developers.  As we know, the voters have now approved just one in four Measure J/Measure R projects.  The citizens get to weigh in on the process but the developers decide ultimately what they are willing to build, the type of project, etc.  The council ultimately decides whether it is good enough to approve.

For the developers this is a lengthy, expensive, and ultimately uncertain process.  The return on investment for housing is such that a few projects have come forward, but as we look toward our economic development needs, this process may simply be too uncertain.

We have had essentially three innovation park proposals come forward since 2014 and only Nishi in 2016 even got to the voters.  The Davis Innovation Center project never got farther than an application.  There was too much risk, too much uncertainty and, rather than risk millions on an uncertain planning process, the developers moved up to Woodland where their project has already been approved.

The Mace Ranch Innovation Center (MRIC) has already spent millions on an EIR which is certified by council, but they have financing problems and uncertainty about voter intentions.  That project remains on hold.

Finally, Nishi as a mixed-use project got to the voters with 300,000 square feet of R&D space but it lost by 700 votes and the next iteration, which passed, does not have an innovation park component.

Given that developers who want to build research parks can go to other communities, I feel this process does not work.  However, contrary to the beliefs of some, I do not believe we need to fundamentally change Measure R to change the way we approve these project.  Instead, we can leave Measure R as it is and simply bring voter approval of a project to the fore.

Instead of having a developer submit an application, we should have a community-driven and city focused process to identify where and what we want.  Put it on the ballot ourselves and if it gains voter approval, then allow the developers to come forward to design a project through the normal planning process for a non-Measure R project.

Here is how that would look.  The council in consultation with the community would find a location where it wants to put the innovation center (you can do this for housing as well, but there are some advantages to doing it for an innovation center).

For example, I would suggest you start by looking at around 300 acres on the east side of Mace.  Why 300?  I would take 200 as an innovation center and 100 to put into either an urban farm or some sort of easement to protect open space on our borders.

Then instead of voting to approve a project, the voters would vote on whether to exempt that land from a further Measure R vote.

In order to do that we would need parameters.  We will call them Baseline Project Features.  Here is a big advantage for the community – there is no applicant, so we create the parameters we want.  We can specify the density.  We can specify the FAR (floor area ratio).  We can specify sustainability features.  We can specify environmental mitigations.  We can specify traffic impact mitigations.  We can specify that it has no housing or we can specify that it has housing.

We have to have an EIR, which would be an expense but it would not be a full EIR.

We then hold a vote.  Someone asked, how are citizens supposed to vote on a project that hasn’t been defined?

That’s why I think this works better for an innovation center than housing.  You don’t define an innovation center the same way you do housing.  We have basic parameters that can only be changed through another vote like density and type of development, amount of commercial space, R&D space, but a lot of that has to be fluid since there is a long build out period anyway.

Why would the citizens do this?

First, they control the process.  They don’t have to wait for a developer to come along.  They don’t have to haggle over housing or types of sustainability features.

Second, it makes it far more likely that a developer can come forward with a project because they will have certainty.

Third, I really believe this is the only way we are going to get larger scale economic development.

What’s in it for the developer?

First, they get certainty.  They don’t have to put money into a project and hope the voters will pass it.

Yes, they will probably have more requirements than they would had they initiated the process, but, at the end of the day, they know that they just need to work with the city within defined parameters and figure out a way to make it work.

What if the developer doesn’t want to develop that land?

That’s always a danger.  Two things on that.  First, by moving land within the urban boundary, we have increased its value greatly.  That means if the developer doesn’t want to build it, they can probably flip the land to someone who does.  Second, they may choose to hold onto the land until they are ready.  But at least we have something approved and can work with them to convince them to develop it.

Are there risks and downsides?

There always are.  In the end, we will prevent the developer from coming back with a housing proposal without a new vote.  But working within the parameters gives a lot of leeway for things to go wrong.

Given that other communities are competing for innovation centers without a Measure R process, this is a way to get the university to partner with us, to get investors to buy in, and to get state funding for a project.

The best part from the perspective of many is that this will not impact Measure R at all.  It leaves the measure intact – it simply shifts when the vote occurs.

—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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57 Comments

  1. John D

    Interesting concept.  Whoever leads the effort, they’ll have their hands full explaining why this obsession on Innovation Centers holds the key to a better future for the Davis community.   Despite its historic reluctance, the university has a key role to play in this important discussion – acknowledging the importance of such developments to its core research programs, faculty and graduate students from having strategic partners working within the community.

    1. David Greenwald

      Not sure why this is an obsession. It’s clear that retail is not going to be the key to revenue or economic development for reasons that have nothing to do with Davis as well as Davis specific.

      This isn’t a stretch – the fact is that Sacramento, UC Davis, Woodland, West Sac, and Dixon have all gone that route and we are the host university town.

      1. John D

        Sadly, that rationale is going to be the first to be attacked.  Mikey likes it!

        Maybe try to explain what it is that these others see as an opportunity is viewed with skepticism in Davis.  Is it an inability to envision a better, newer, improved version of Davis – and that includes our schools by the way?   Is it a lack of confidence in those in charge of the planning?   Is it the absence of an up-to-date, forward looking general plan?  Likely all of these.

        I continue to be one of the most outspoken supporters of the need for more, local technology employment within the city of Davis.  I fully supported the Davis Chamber’s goal of generating 10,000 new jobs by 2040.  But, I can’t help but feel that we did a great disservice to the developers and the community by simply launching into the necessity of Innovation Centers as the salvation for the community and our municipal finances without providing a more compelling case AND without providing some larger discussion and planning documents to demonstrate why and how such initiatives could be leveraged to improve our fundamental transit routes, connectivity, revitalize the Downtown, increase funding for our parks and schools, enable more capacity to make progress on issues like affordability and strengthened safety nets for our elderly and those less able to care for themselves.

        The money has to come from somewhere, and local prosperity and economic vitality are two key ingredients.

        My family is from Missouri – show me how it will lead to a better version of Davis tomorrow without destroying what we most cherish today?

        1. Jeff M

          show me how it will lead to a better version of Davis tomorrow without destroying what we most cherish today?

          This is an overly simplistic challenge in my opinion.

          It leaves off the question about the consequences of clinging to what you most cherish today.

        2. David Greenwald

          Part of the problem I see is that we are destroying what we cherish now.  We can’t afford to maintain basic infrastructure, services and amenities.

        3. John D

          No disagreement with your critiques or the consequences of inaction – but neither of address the identified challenge, nor how you plan to go about sharing your visions of what would define a better tomorrow, nor how, and what steps, you believe are necessary – process wise – to get us there.

        4. Mark West

          We don’t need a new process in town, we need a new attitude of creating opportunities for all instead of our decades-old approach of protecting the well-connected few. Economic development is really quite simple, you make it easier to start and grow new businesses while creating jobs and opportunities for residents, which of course is the opposite of what we do now.

          We don’t actually need an innovation center per se, but we do need available land for growing businesses to expand into. We also need our existing business and commercial property owners to stop impeding change with their ‘backroom’ deals and lawsuits aimed at protecting their position as the ‘big fish in a little pond.’

          “show me how it will lead to a better version of Davis tomorrow without destroying what we most cherish today?”

          Show me how our current course will prevent the destruction of what we cherish today. Without economic development, our City will continue on its current path towards insolvency, municipal decay, and an ever-increasing cost of living. The status quo approach won’t even protect our current version of Davis for long, so how again will it make anything better?

  2. Todd Edelman

    An informed, wise and grounded yet optimistic assault on bad development where the

    council in consultation with the community would find a location where it wants to put the innovation center

    Would be unlikely to look

    at around 300 acres on the east side of Mace.

    Why not?  Because an  innovation center, even with an “urban farm”

    or some sort of easement

    is too peripheral (e.g. faster to get there by car from Sacramento than by bike or non-express bus from West Davis), and still very monopurpose: Streets in a multi-function district are used far more efficiently both at surface and below. Campuses can be very inefficient, partly mitigated of course by smart internal transportation. But in something like MRIC people would not be in multiple locations every day, and much of e.g the UCD or other modern academic campus is empty at night.

    Like Covell Village, MRIC – even as a different kind of place – would be a traffic-inducing nightmare unless there was some kind of high-capacity transit that served it directly, but still it would be monopurpose.

    Most of our large sites are also next to I-80, which has different pollution impacts depending on how one looks at it.

    Good development in Davis starts with significantly reducing the hazards of I-80 whilst focusing development on huge sites such as PG&E, and all the large parking lots all over town, with total automobile modal share no more than 50% citywide, encouraged by 25% in new developments.

    1. David Greenwald

      Find a better spot for a 200-300 site. That’s fine. I don’t think you’ll find one. As much as you don’t like I-80 there are reasons to put it with close access to it. It’s why the Cannery never flew as a research park site and why Covell Village won’t either.

      1. Keith O

        You know better than that, that’s why the LOL.

        What’s kind of funny is does Mark West only think it’s noise when anonymous commenters disagree with him? Or are all comments from anonymous commenters just noise?

  3. Ron

    Great.  Now, some are pushing for the city itself to assume the role of a developer. The property owner is just going to remain on the sidelines, as an uninterested party?

    I wonder where the money will come from, for the advertising campaign leading up to a Measure R vote? (Other than the “free advertising”, on the Vanguard?)

    *sigh*

      1. Howard P

        To clarify… expressing an intent to annex, in the context of a GP revision/amendment, and “pre-zoning” the land, does not give me grief…

      1. Ron

        How is the role of the city to promote a private development? Or, do you think that voters will just “trust” the advice of the new council, and that no promotion would be needed? (Assuming that they even agree with each other, and that the analyses from the city’s supporting commissions doesn’t contradict what they push for.)

        If you think that deep-pocketed developers have a hard time getting a development approved, just wait until the city attempts to do so.  (The same city that fails to control costs in the first place.)

        So, the landowner is just going to sit on the sidelines, and not become “involved” in such an effort?

        1. David Greenwald

          It’s the role of the city to find ways to facilitate economic development.  There is nothing in here that presupposes that this would be a private development.  It could well be a public-private partnership.  There is nothing written here that the landowner would sit on the sidelines, there is also nothing written here that the landowner would participate.  That would be up to them.

        2. Ron

          I believe that cities cannot legally operate or participate in “for-profit” commercial enterprises, for one thing.

          David:  “There is nothing written here that the landowner would sit on the sidelines, there is also nothing written here that the landowner would participate.  That would be up to them.”

          There is a level of naivety, in this statement.  I think that you’re intelligent enough to recognize that.

           

           

        3. Don Shor

          The role of the city is to establish zoning, any conditional uses, any disallowed uses, list the parameters of any proposed development with respect to mitigations. The city can use annexation to create an urban limit line. The city can purchase agricultural easements for fixed time periods or in perpetuity to prevent the development of property. Those are all normal planning decisions and practices that cities engage in regularly. If you want developers to know that a parcel is for commercial development only and without residential of any kind, zoning is a simple way to achieve that. If you want any change in zoning or conditional uses to require a public vote, you can state that directly.
          What this does is put land use planning in the hands of the city, where it belongs. Then developers and adjoining neighbors know, up front, exactly what to expect on a parcel of land.

        4. Howard P

          It’s the role of the city to find ways to facilitate economic development. 

          Untrue, as written… with nuances…

          Cities are to provide services that individuals cannot… gets to why Davis incorporated as a city…

          Now, funding those services are a legitimate “role” of the City… be it cost containment, taxes, or economic development (generating taxes, BTW)… the role of a City is not “to grow”, but to accept growth (time, place, manner) to serve its citizens… or those who wish to be citizens, within parameters…

        5. David Greenwald

          Look at the Purdue innovation center Ron, as an example.  The city of West Lafayette played a role, as did the a private company and Purdue University.

  4. Ron

    The city’s proposed mitigation, regarding the EIR for the LRDP:

    Proposed Mitigation Measure #5 — The University will enter into an agreement with the City to compensate for the direct and indirect impacts of students on city infrastructure and services (e.g. transportation, transit, utilities, water supply, wastewater treatment, stormwater conveyance, parks and greenbelts, community services, recreation facilities and programs, police and fire service).

    Perhaps the city could also stop giving raises (which will exceed the immediate increases in salary, when subsequent pensions are considered). Seems like the height of irresponsibility to do so at this time.

    Would also help if the city stopped approving developments that can exacerbate the city’s financial challenges (e.g., Nishi, Sterling . . .). (Ironically, these developments help support the same entity that’s creating the need for “mitigation”, as noted above.)

  5. Ron

    Just a reminder that Davis is not alone, regarding unfunded liabilities:

    “The report escalates the League of California Cities’ appeal for more flexibility in negotiating pension obligations.”

    “Brown at a news conference last month predicted the next recession will force even bigger changes on California public pension plans. In a high profile court case, his office is advocating for an end to the legal precedent that prohibits public agencies from reneging on pension promises without offering workers other compensation.”

    https://www.sacbee.com/news/politics-government/the-state-worker/article198062129.html

     

      1. Ron

        So, look at the two efforts quoted above to change that situation.  (Which also mentions the next recession – which will also simultaneously impact efforts to “grow our way out of” the challenges.)

        If you’re objecting to the content of that article, you might want to take it up with the Sacramento Bee, the League of California Cities, and Governor Brown. (Possibly even the court system which will hear the challenge mentioned.)

        1. Ron

          I decided to “click” on the link cited in blue text (in the article I cited above).  That link leads to the following citations (in which I bolded some text):

          “Those cases have collected a cluster of appeals court rulings that have questioned the California rule. One said public workers are “entitled only to a ‘reasonable’ pension, not one providing fixed or definite benefits immune from modification.”

          Brown cited that ruling when he spoke to reporters this week.

          “There is a lot more flexibility than is currently assumed by those who discuss the California rule, Brown said. “At the next downturn when things look pretty dire, (pensions) will be on the chopping block.”

          https://www.sacbee.com/news/politics-government/the-state-worker/article194434479.html

          I wonder why we don’t hear much (or perhaps anything) about such efforts, on the Vanguard. It certainly would impact the situation throughout California (including Davis).

          1. Don Shor

            So you think this negates the benefits of economic development? I never really understand what your over-riding philosophy is. You seem to be against literally everything.

      2. Alan Miller

        > So what?

        When the giant bailout comes, Davis will get its share.

        So why bother with improving the economy?  Just a waste of time.

        See also “money from heaven”.

         

        1. Ron

          See also “money from heaven”.

          Yeah.  Could be interpreted (and even calculated) in more than one way. (We’ve already seen some examples.)

  6. Alan Miller

    This idea is preposterous.  Measure JR wasn’t created because citizens wanted a say in peripheral development, as such.  It came about because the City kept approving developments the citizens didn’t like that gave too many concessions to the developers and ignored citizen input.  Recent history with the City going back on what we thought were “promises” on the Cannery and giving concessions to the developers there after-the-fact only continue distrust of the process.

    See also the Design Guidelines, that those of us who participated considered an agreement of how growth was to occur in the historic neighborhoods.  But after all the work, we are told “they are only guidelines”, and the City gets legal justification to do what IT wants to do, rather than honor the spirit of the agreement.  “Out of date” cry opponents.  Show me a legal agreement without an expiration date that is out of date.  So now we have planning processes again.  Do the citizens need a lawyer now to make sure that the new agreements are legally “enforceable” and not just suggestions?  And if they are just suggestions, why bother with the planning process?  Better to take a night job to fund the next lawsuit.

    On growth I’m a moderate, confounding both the development-obsessed and the no-growthers.  I don’t agree with Measure JR.  I think it’s bad for the City.  But, I’d probably be fighting every project that came up if JR disappeared as the City would no doubt go back to its pre-JR ways again.  But Measure JR won’t go away, because now in addition to ideology there’s the pocketbook-lining incentive as well.

    But as long as JR does exist, hell if I’ll vote in a BLANK project and entrust that the pre-loaded BPF’s won’t have as many legal loops in them as Design Guidelines or a Cannery Agreement.  But y’know, some people are stupid, and since there is no project, there is nothing to criticize, so they are only voting for an empty lot and some words, so maybe they’ll get confused between voting yes and a bowl of Wheaties, allowing the “Kingdom and the Power and the Glory Innovation Park” to pass its JR vote.

    FEAR OF A BLANK PROJECT

    1. David Greenwald

      Alan: It’s not a blank project. I don’t think this process would work for housing. But the way an innovation park works is that you have a long-term build out rate. How specific do you think you can get with an innovation park anyway? Density? Sure. Max R&D space in square feet? Sure. Sustainability features? Yes. But beyond that what details are you going to know in advance in a tech park?

        1. David Greenwald

          That’s why you would have baseline features and it’s important to recognize that the council has not approved any of the proposed changes to Cannery after the fact

  7. Jim Frame

    I don’t understand the point of this article’s proposal.  The city can’t annex land without the landowner’s approval, and no landowner is going to volunteer to have their land annexed — with the concomitant tax increase — unless they plan to develop it.  And if they plan to develop it, they’re going to want to develop it in a way that makes (financial) sense to them.

    As I understand the proposal on the table, the city would go through an expensive (staff time, consultant time) process to come up with a development plan for a parcel it doesn’t own.  It would then hand that plan to the owner and say, “So, whaddya think, you want apply for annexation and development according to our plan?”  I think the likely response would be “Thanks, but we’re not interested at this time.”  So then what, on to the next parcel and another expensive process for the city?

    If the owner were to think that the city’s plan was a good one, wouldn’t he already have invested the time and money to come up with it on his own (and at his own expense)?

    I can see the city targeting parcels for certain kinds of development and inviting the owners to discuss common interests, but that would be an informal process with little investment required by the city.  I believe that’s essentially what the innovation park RFI was all about.  But I can’t see the sense in making a serious investment on the off chance that a parcel owner will want to do something he hasn’t already considered.

     

    1. David Greenwald

      The city would not need to annex the land The city would take a parcel and by a vote of the people exclude it from a future Measure R vote with stipulation put on it.

      1. Jim Frame

        The city would take a parcel and by a vote of the people exclude it from a future Measure R vote with stipulation put on it.

        Only after spending considerable time and money developing the detailed stipulations and running an election, after which the owner can simply shrug his shoulders and say, “Thanks, but not interested.”  This strikes me as a plan with an inordinately high probability of returning nothing on the investment.

        1. David Greenwald

          I don’t agree with you that there’s a high likelihood that the owner can shrug his shoulders. First of all, you’re not doing this blindly. Second, you’re basically adding a huge amount of value to the owner’s property by moving it within the virtual limit line. An owner not wanting to do that project is going to flip it to a developer that will. The likely spots we know there will be interest to either build an innovation park or flip it to someone who will.

        2. Don Shor

          The point of this is to get business parks moving forward in the planning process. If you’ve got another suggestion for how to do that, great. The present situation has led to an impasse that has stymied the city’s economic development goals. Our present return on investment is zero.

        3. Alan Miller

          > The present situation has led to an impasse that has stymied the city’s economic development goals.

          Just because the present situation isn’t working doesn’t mean it’s time to pursue a desperate, fruitless strategy to alleviate that.

        4. David Greenwald

          “Just because the present situation isn’t working doesn’t mean it’s time to pursue a desperate, fruitless strategy to alleviate that.”

          I find it weird that you would call a city process to identify and approve land for a specific purpose “desperate” and “fruitless.”

  8. Ron

    Jim:  “As I understand the proposal on the table, the city would go through an expensive (staff time, consultant time) process to come up with a development plan for a parcel it doesn’t own.”

    Excellent point.

    Wondering if this entire hair-brained idea originated (only) from the Vanguard.  Or, if David is “floating it”, on behalf of others (and/or, to influence the new council).

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