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HomeMy WebLinkAboutPlanning Comm Rpts./1997/10/09 Thursday. October 9, 1997 5:30 p.m. Council Conference Room Administration Building Snecial Joint Meetin~/Worksession of tbe City of Chula Vista City Council and the P]annin~ Commission CALL TO ORDER 1. ROLL CALL: Councilmembers Moot _' Padilla _' Rindone _' Salas _' and Mayor Horton 2. REPORT 3. REPORT Planning Commissioners Aguilar _, O'Neill _' Ray _, Tarantino _' Thomas _' Willet _, and Chair Davis _' BUSINESS LACK OF ADEQUATE INDUSTRIAL ZONED LAND IN CHULA VISTA - San Diego County bas a decreasing supply of "deliverable" industrial acreage and an increasing industrial demand. Past events and current issues are resulting in a diminished industrial land inventory in Chula Vista master planned communities and tbe Bayfrant, Southwest and Otay Valley Road Redevelopment Project Areas. The current lack of industrial inventory dictates the need to reevaluate our recruitment strategies and outreach efforts and/or to augment and upgrade our industrial land and building supply. Proposed activity could further reduce the availability of industrial property and further limit the City's ability to respond to ongoing and future business demands. Staff recommends that Council and the Planning Commission review the information and provide direction to staff. (Community Development Director) THE CITY OF CHULA VISTA AFFORDABLE HOUSING PROGRAM--The purpose of this report is to update, the City Council on the current status of affordable housing in Chula Vista, to indicate the progress that has been made, and evaluate the current efforts, resources and strategies that are available to address continuing needs. Staff recommends that Council review the information and provide direction to staff. (Community Development Director) ORAL COMMUNICATIONS This is an opportunity for the general public to address the City Council on any subject matter within the Council'sjurisdiction that is not an item on this agenda for public discussion. (State law, however, generally prohibits the City Council from taking action on any issues not included on the posted agenda.) lfyou wish to address the Council on such a subject, please complete the "Request to Speak Under Oral COlllmunications Fonn" a~ailable in the lobby and submil illo Ihe Cily Clerk prior 10 the meeting. 17lOse who Jf..'ish to speak, please give your name and address for record purposes and follow up action. Agenda -2- October 9, 1997 OTHER BUSINESS 4. CITY MANAGER'S REPORTCS) a. Scheduling of meetings. 5. MAYOR'S/CHAIR'S REPORTCS) 6. COlJNCIL/COMMISSIONER'S COMMENTS ADJOURNMENT The City Council will adjourn to the regular City Council meeting on October 14, 1997 at 6:00 p.m. in the City Council Chambers. The Planning Commission will adjourn to the regular Planning Commission meeting on October 22, 1997 at 7:00 p.m. in the City Council Chambers. * * * COMPLIANCE WITH AMERICANS WITH DISABILITIES ACT * * * Tbe City of Chula Vista, in complying with the Americans with Disabilities Act (ADA), request individuals who require special accommodations to access, attend, and/or participate in a City meeting, activity, or service request such accommodation at least forty-eight hours in advance for meetings and five days for scheduled services and activities. Please contact the City Clerk for specific information at (619) 691-5041 or Telecommunications Devices for the Deaf (TDD) (619) 585-5655. California Relay Service is also availahle for the hearing impaired. Notice is hereby given, pursuant to Gm'ernment Code Section 54956, that the Mayor and City Council of the City of Chula Vista has called and will convene a Special Joint Meeting/Worksession of the City of Chula Vista City Council and Planning Commission on Thursday, October 9, 1997 at 5:30 p.m. in the Council Conference Room, Administration Building, 276 Fourth A venue, Chub Vista, CA. JOINT COUNCIL/PLANNING COMMISSION AGENDA STATEMENT Item Meeting Date 10109197 :2 ITEM TITLE: REPORT: LACK OF ADEQUATE INDUSTRIAL ZONED LAND IN CHULA VISTA SUBMITTED BY: Community Development Director [~S J Executive Oirect03 (415ths Vote: Yes_ No~ REVIEWED BY: BACKGROUND: San Diego County is faced with a decreasing supply of "deliverable" (readily developable) industrial acreage and an increasing industrial demand. Additionally. there is a shortage of large parcels to accommodate large manufacturers. With the future development of EastLake Business Center Phase II in question; Otay Ranch industrial development off in the future, and questions regarding future land uses in the Bayfront and Otay Valley Road areas, Chula Vista faces this same potential dilemma on a local scale. Community Development staff has recently received several requests for property and in many cases has been unable to offer a site that meets the needs of the company. This recent activity has brought to the forefront the shortage of deliverable industrially zoned property in Chula Vista. The attached Issue Paper (Exhibit 2) is intended to provide Council with an overview of why industrial uses are important to a community, how Chula Vista has planned for such uses, concerns regarding the adequacy of our industrial land supply to meet current and future demands, and suggested short. and long.term approaches to address potential industrial inventory shortages. RECOMMENDATION: Staff suggests that Council evaluate and address the industrial land supply from both a short- and long. term perspective. Short. and long.term issues and recommendations are outlined below: Short. Term Recommendations: That Council: 1) Affirm the City's desire to preserve the High Tech/Biotech Zone by maintaining an industrial land use designation in both Phases I and II of the EastLake Business Center; 2) Direct staff to analyze the potential to create an overlay zone that will allow Research/lndustrial uses within the 30 acre property adjacent to Eastlake Business Center; and 3) Direct staff to analyze the impact of proposed industrial land use conversions utilizing the 4.step process described herein. c2~/ Page 2. Item _ Meeting Date 10/09/97 Lono- Term Recommendations: 1) That Council direct staff to prepare a report which addresses: a) the need to preserve existing industrial stock via an adopted policy; and b) the potential of redesignating areas of the City to industrial land use_ 2) That Council provide staff with their vision as relates to the future role of industrial development within the Baytront, otay Valley Road and Southwest areas in order to help staff tailor ongoing and future economic development promotional activities. BOARDS/COMMISSIONS RECOMMENDATION: In a letter to Council dated October 15, 1996, the Chula Vista Economic Development Commission expressed their concern regarding the diminishing supply of industrial acreage in Chula Vista, and suggested that Council direct staff and the Planning Commission to formulate a policy regarding replacement of industrial land so that the City is prepared to accommodate large industrial users attracted to our City as the regional economy continue to recover (see Exhibit 1). The Planning Commission has requested that the workshop on this issue be held jointly with the Commission and Council. DISCUSSION: IMPORTANCE OF INDUSTRY TO A COMMUNITY One major benefit of industrial businesses is the direct creation of high paying jobs, which raises the area's standard of living_ Industrial development also generates greater "spin-off" benefits in terms of indirect jobs and employee-related tax revenues. In addition, manufacturers are excellent economic engines because they bring new wealth into the community rather than just recycle the same dollars. Finally. ,industry increases a community's property tax base and generally produces more' revenue to a City's General Fund than expenses for municipal services to support that industry_ ADOPTED PLANS RELATED TO INDUSTRIAL DEVELOPMENT Several planning and policy documents have been adopted by the Chula Vista City Council which address the need for industrial development and which set aside land areas for this purpose. Past events and current issues are impacting these designated industrial areas in the EastLake, Rancho Del Rey, Sunbow II. and otay Ranch master planned communities, as well as in the Baytront, Southwest and Dtay Valley Road Redevelopment Project Areas, resulting in a diminished industrial land inventory. ONGOING INDUSTRIAL DEVELOPMENT EFFORTS The Community Development Department has been promoting industrial development for many years with initiatives such as the High Tech/Biotech Zone and the Border Environmental Commerce Alliance (BECA), in addition to citywide image enhancement efforts, business attraction and assistance programs, and redevelopment d~c2 Page 3. Item _ Meeting Date 10109/97 activities. These efforts have been predicated on the availability of appropriate. developable, industrially zoned land. Due to the improvement in the economy and successful Chula Vista business outreach efforts, we are now seeing tangible demand for property. The current shortage of "deliverable" industrial inventory suggests the need to reevaluate our recruitment marketing strategies and/or to augment and upgrade our industrial land and building supply. INDUSTRIAL lAND SUPPLY IN CHUlA VISTA During the recession, and due to lack of industrial activity, the City's supply of industrial land was diminished due to rezonings to accommodate non.industrial uses. Today, readily developable industrial properties are generally limited to 20.:1: acres in Eastlake Business Center Phase I and a few parcels in the Bayfront. Southwest and Otay Valley Road. The limited supply of industrial land is exacerbated by the fact that the majority of available parcels are under five acres. which precludes many types of industrial users such has biotech and high tech manufacturers. Much of the available property has additional constraints to immediate development, such as lack of infrastructure, environmental contamination, or limited access. Proposed activity could further limit the City's ability to effectively respond to business needs. Proposals include rezoning portions of Phase II of the Eastlake Business Park, approximately 50% of the Sunbow Industrial Park and other industrial properties to non. industrial uses, as well as requests to use existing industrial buildings for non.industrial purposes. INDUSTRIAL DEVElOPMENT TRENDS The San Diego region's industry has shifted to include non.defense related, technology based companies. The region has an opportunity to transform itself into a high performance, globally competitive international economy, an economy that will generate abundant, high paying jobs and raise the standard of living. Demand for industrial land and buildings is significantly increasing in the region and. in Chula Vista. As noted, only 5 acres of industrial property sold in 1992 in all of San Diego County; in 1996 this increased to 800 acres. As a result of the improved economy and successful business attraction efforts bearing fruit, demand for industrial land has shown a marked increase in Chula Vista. Unfortunately. Community Development staff is experiencing difficulty identifying deliverable vacant sites to meet current demand. HDW CAN CHUlA VISTA ADDRESS THE INDUSTRIAL lAND SHDRTAGE? Negative impacts may result if actions are not taken to mitigate the diminishing supply of industrial land. Several cities are currently considering measures to increase their industrial areas, such as preserving remaining industrial stock. and/or modifying commercial zones to allow for limited light industrial uses. Staff recommends that the industrial land supply in Chula Vista be approached from both a short term and long term perspective. Staff recommends that Council: 1) affirm the City's desire to preserve the High Tech/Biotech Zone by maintaining an industrial land use designation in both Phases I and II of the Eastlake Business Center; 2) the feasibility of creating industrial overlay zones and/or amending the existing zoning ordinance to allow for limited light industrial uses within certain commercial areas throughout the City; and 3) direct ;2-3 Page 4, Item _ Meeting Date 10109/97 staff to analyze the impact of proposed industrial land use conversions utilizing the following 4.step process: . Early notification of Council regarding the land use proposals. . Staff review of the potential for significant fiscal or economic impacts to the City. . If significant impacts are identified, preparation by the applicant and/or staff of an economic impact analysis for submission to the Planning Commission and City Council. . Input from the Economic Development Commission, if requested by the applicant or staff. For the long term, we need to ensure an adequate supply of developable industrial property that will meet future need. Staff recommends that Council direct staff to prepare a report which address: 1) the need to preserve existing industrial stock via an adopted policy; and 2) the potential of redesignating areas of the City to industrial land use. Staff also recommends that Council provide staff with their vision as relates to the future role of industrial development within the Bayfront, Otay Valley Road and Southwest areas in order to help staff tailor ongoing and future economic development promotional activities. (CD) H:\HOMEICOMMDEV\STAFF.REP\10.09.97\industriaIIOctober 3,1997 (3:59pm}] c1-Lj ~\f?- :A_--= ---- """'~~-- ""':;o...~~- EXHIBIT 1 CllY OF CHULA VI5fA ECONOMIC DEVELOPMENT COMMISSION October 15, 1996 The Honorable Mayor and City Council 276 Fourth Avenue Chula Vista, CA 91910 RE: DIMINISHING SUPPLY OF INDUSTRIAL LAND Honorable Mayor and City Council: The Economic Development Commission wishes to raise the visibility of an issue of great concern regarding the City's future ability to attract businesses in manufacturing, distribution, research and development, and high-tech. Land use decisions over the past several years have caused a change of use to hundreds of acres of finished industrial land. These decisions accommodated other important projects such as the Rancho del Rey Power Center, the Chula Vista Auto Park, MCA Amphitheater, and the Whitewater Water Park. We agree with the logic of these past rezonings and, in fact, positively endorsed each of these projects. However, we do have a concern regarding the City's diminished industrial acreage. We would sl)ggest Council direct staff and the Planning Commission to formulate a policy regarding the replacement of industrial land so that the City is prepared to accommodate large industrial users who may be attracted to our City as the regional economy continues to recover. Attached you will find a matrix delineating the industrial areas, net acreage currently available, and estimated acreage demand per the WKA study commissioned by the City in 1993. Thank you for your consideration of this matter, and we will look forward to working with the Council and staff to provide our continued input regarding this issue. Sincerely, ECONOMIC DEVELOPMENT COMMISSION DR/ak Attachment , cc: City Manager Community Development Department Planning Department Planning Commission $ f - ( M:\home\commdev\rafoli\edc2.!et CITY OF CHULA VISTA AVAILABLE INDUSTRIAL LAND AVAILABLE AND PLANNED ECONOMIC DEVELOPMENT COMMISSION ESTIMATES Vacant Industrial Acreage Anticipated Net Changes in Improved 1993 1996 Acreage Acreage Expected to Remain Improved Improved Unimproved Industrial WESTERN AREA: Central Area 18 18 0 18 Bayfront . 55 55 0 55' Montgomery 13 13 0 13 EASTER"'" TERRITORIES: Eastlake Business Center 33 33 80' 0 33 Rancho Del Rey 16 12 0 I 12 Otay Rio Industrial Park 123 32 (32)' 0 Ot:y Valley Area 129 102 (50)' 52 Otay Ranch Village 149 0 0' Sunhow 46 0 0' TOT ALS: 387 265 275 (82) 183 Note: Williams-Kuehelheck & Associates 1993. market analysis estimated the City's future industrial demand as follows: Year 2000: Year 2010: Year 2015 9 I acres 241 acres 321 acres lPort District rezoning in process. Anticipated to change zoning from aircraft manufacturing to industrial business park without affecting available acreage 2 Assumes Phase II of business park remains 100% industria!. 3Vac:mt acre:lge adjacent to MCA Amphitheater and waterpark anticipated to be used for recreational purposes. 4lnc1udes Auotpark park phase II, trash transfer station, and other potential rezonings. ,p. . d ropeitles are unImprove . €I-d..- EXHIBIT 2 TABLE OF CONTENTS ISSUE PAPER LACK OF AOEOUATE INDUSTRIAL ZONED LAND IN CHULA VISTA INTRODUCTION I. THE IMPORTANCE OF INDUSTRY TO A COMMUNITY ...................... 1 A. "IMPORTED" OOLLARS ....................................... 1 B. HIGHER PAYING JOBS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 1 C. "SPIN-OFF" BENEFITS ........................................ 2 II. ADOPTED CHULA VISTA PLANS RELATED TO INDUSTRIAL DEVELOPMENT. . . . . . .. 3 A. CHULA VISTA GENERAL PLAN . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 3 B. ZONING ORDINANCE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 4 C. GENERAL DEVELOPMENT AND SECTIONAL PLANNING AREA (SPA) PLANS ...... 5 D. REDEVELOPMENT PROJECT AREA PLANS ........................... 7 1. Bayfront . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 7 2. Otay Valley Road ...................................... 8 3. Southwest. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 9 III. ONGOING INDUSTRIAL DEVELOPMENT EFFORTS .......................... 9 A. CHULA VISTA ECONOMIC DEVELOPMENT PLAN ....................... 9 B. BUSINESS OUTREACH ACTIVITIES ............................... 10 C. HIGH TECH/BIOTECH ZONE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 10 D. WESTERN REGIONAL BIDPROCESSING CENTER (WRBC) ................. 11 E. BORDER ENVIRONMENTAL COMMERCE ALLIANCE (BECA) . . . . . . . . . . . . . . .. 11 F. REDEVELOPMENT ACTIVITIES .................................. 12 IV. INDUSTRIAL LAND SUPPLY IN CHULA VISTA ........................... 12 A. TOTAL SUPPLY AND PROJECTED NEED. . . . . . . . . . . . . . . . . . . . . . . . . . .. 12 B. LACK DF LARGE PARCELS ............... _ . . . . . . . . . . . . . . . . . . .. 14 C. LIMITED BUSINESS PARKS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 16 D. OTHER IMPEDIMENTS TO DEVELOPMENT .......................... 16 E. PROPOSALS WHICH COULD FURTHER ADVERSELY IMPACT INDUSTRIAL LAND SUPPLY ................................................ 16 V. INDUSTRIAL DEVELOPMENT TRENDS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 17 A. SAN DIEGO REGION ........................................ 17 B. SOUTH BAY. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 18 VI. HOW CAN CHULA VISTA ADDRESS THE INDUSTRIAL LAND SHORTAGE? ........ 19 A. OTHER CITIES' APPROACHES .................................. 19 B. EXISTING POLICIES REGARDING CONVERSION OF INDUSTRIAL LAND ........ 20 C. STAFF RECOMMENDATIONS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 21 e2.-1 ISSUE PAPER LACK OF ADEOUATE INDUSTRIAL ZONED LAND IN CHULA VISTA INTRODUCTION During the past 6 years, the San Diego region has been in an economic recession. Industrial activity has been slow, with little to no absorption of industrial space or land. Our economy is coming back. Industrial land is moving again. In 1992 only five acres of industrial property sold in the County. In 1996, 800 acres sold and in just the first seven months of 1997, 700 acres have been sold for development. Today, San Diego County is faced with a decreasing supply of "deliverable" industrial acreage (able to be developed in the immediate future) and an increasing industrial demand which is projected to further increase in the next few years. Currently, there are approximately 1400 acres of industrial acres available for development in the County. If development occurs at the same pace as in 1996 and 1997, this is only a two year supply. Additionally, there is a shortage of sites that are 20 acres or larger. According to Grubb & Ellis, there are only three areas left in the County with property available over 20 contiguous acres - Poway, Otay Mesa and EastLake in Chula Vista. This is critical because San Diego County has the opportunity to capture the manufacturing end of the high tech and biotech industry which have large acreage requirements. But if the region does not provide adequate acreage for these new facilities, the companies will leave the region and possibly the State. As previously noted by the City's Economic Development Commission, Chula Vista faces this same dilemma on a local scale. In 1993, a market study was prepared by William Kuelbelbeck and Associates (WKA) which concluded that, in order to achieve a recommended 50 year supply of industrial land, 200 additional acres were needed in the City's industrial inventory. Since that time, approximately 175 acres of planned industrial land have been converted to other uses. Today, proposals exist to rezone even more industrial land to residential or other non-industrial uses, leaving an extremely limited developable supply. As supply has dwindled, demand for industrial land in Chula Vista has re.emerged at a significant level. Community Development staff has received several recent site inquiries from companies ranging from non- manufacturing to biotech manufacturing. In almost all cases, we have been unable to offer them a site that meets their needs. These requests have brought to the forefront the inadequacy of deliverable and desirable industrially zoned land in Chula Vista. Adding to the problem are impediments to development facing most existing industrially zoned parcels, such as lack of infrastructure and costly, lengthy entitlement requirements. It is imperative at this juncture to evaluate the need for industrial development opportunities within the City, Chula Vista's current industrial land and building stock, and existing land use policies which impact our industrial inventory and our ability to respond to business needs. An understanding of these issues is critical to the City's ability to capture immediate economic development opportunities, as well as to updating and implementing an aggressive short and long term Economic Development Strategy and Economic Development Marketing Plan. This paper is intended to provide Council with an overview of why industrial uses are important to a community, how Chula Vista has planned for such uses, concerns regarding an industrial land supply inadequate to meet current and future demands, and suggested short. and long. term approaches to address this industrial inventory shortfall. C2-L I. THE IMPORTANCE OF INDUSTRY TO A COMMUNITY A. "IMPORTED" OOLLARS Knowing the structure of the local economy and its underlying dynamics is essential in order to develop public policies which promote the economic vitality of a City. The local economic base is composed of producers and consumers. Producers are the businesses which provide products or services to individuals or other businesses. Consumers are the individuals or businesses that purchase the product or service. Among the producers, there are a number of business sectors ranging from manufacturing to retail trade. Producers are further distinguished by those which are local serving (have customers within the community, such as service providers and community- based retailers) vs. export (have customers outside of the area, such as manufacturers). Local serving producers recirculate dollars within the region. Export serving producers, known as "primary industry," generate products and services that can be exported outside the community and therefore bring dollars into the region. Businesses such as manufacturers of exported products that bring new wealth to the community are better economic engines than those that merely recycle the same dollars. B. HIGHER PAYING JOBS Both commercial and industrial operations are essential for a healthy local economy. Each provide benefits to their host city but in different ways. The primary benefit of commercial businesses is sales tax revenue. The primary benefit of industrial businesses is the direct creation of high paying jobs, which raise the area's standard of living. According to SANOAG's "REGIONAL ECONOMIC PROSPERITY STRATEGY," and using 1991 dollars, the manufacturing sector pays an average wage of $28,093 per employee, whereas the service sector pays an average wage of $16,406. The average manufacturing wage in San Diego in 1994 was $35,068; and the average retail wage was $14,929. The significance of maintaining a strong industrial base can be illustrated by the San Diego regional economy. The San Diego region has lost ground in its standard of living over the past decade. In the 1970's, the San Diego region's per capita income was 15% higher than the California average and 35% higher than the U.S. average. By the 1990's, San Diego's per capita income was less than California's and was only slightly higher than the national average. (At the same time, San Diego's cost of living is 20% higher than the national average.) In terms of average annual wages, San Jose ranks highest of the 311 metropolitan areas in the U.S. with an average annual wage of $42,409; San Diego County's average annual wage is $27,845; Chula Vista's is $28,371. As a result, the 1994 SANDAG Economic Prosperity Strategy emphasizes the need to encourage "high value added employment" as provided by manufacturers. Accordingly, the San Diego region has adopted a strategy to target high technology industry dusters whose wages are significantly ISSUE PAPER - ADEQUACY OF INDUSTRIAL ZONED lAND IN CHUlA VISTA Page 1 e2. -.3 higher than the regional average. These industries represent an opportunity to create sustainable economic prosperity in the region. The chart below illustrates the income levels of certain of these targeted industries_ # EMPLOYED AVERAGE WAGE. INDUSTRY IN REGION % HIGHER THAN REGIONAL AVERAGE Telecommunications 12,000 68% Biotechnology 24,000 40% Electronics Manufacturing 22,000 56% Defense Manufacturing 21,000 41% Software 10,000 69% Chula Vista has, for the past few years, targeted the biotech industry and the environmental technology industry, based upon our ability to offer advantages to these clusters and the benefits these value-added, high paying employers can bring to our City. C. "SPIN-OFF" BENEFITS In addition to new quality jobs created directlv by industry, industrial businesses generally also have greater "spin off" benefits, i.e. jobs and revenue generated indirectlv by the new business. For example, both the new business and its employees will require additional goods and services, which in turn will create the need for more workers and generate more tax revenues. Multipliers are commonly used in determining the number of "spin-off" jobs generated by an employer. Multiplying the number of jobs at the new facility by the appropriate multiplier provides an estimate of the total impact on employment in the region. For example, an industrial company hiring 100 new employees, with a multiplier of 2.1, is estimated to indirectly create an additional 210 jobs, for a total of 310. The California Trade and Commerce Agency multipliers below illustrate the difference between industrial and commercial job creation. INDUSTRIAL MULTIPLIER Electronic equipment 2.10 Electronic components 1.87 Aerospace 1. 71 RETAil MULTIPLIER Wholesale Trade 1.48 Retail Trade 1.41 Eating Places 1.33 SANDAG's emphasis on Value-Added Employment pertains not only to wage levels, but also to employee-related taxes and growth management. SANDAG's study indicates that the service ISSUE PAPER - AOEQUACY OF INDUSTRIAL ZONED LAND IN CHULA VISTA Page 2 E2-1 sector pays 40% less in taxes per employee than does the manufacturing sector. This means public revenues per capita are greater from manufacturing employers. In terms of growth management, SANOAG indicates that for every $1 million increase in demand for "services," the region requires more than 2.1/2 times the number of employees than it does for producing "goods." Thus, there is less population growth to manage (plus greater public revenues and higher wages. for a higher standard of living). II. ADOPTED CHULA VISTA PLANS RELATED TO INDUSTRIAL DEVELOPMENT Several planning and policy documents have been adopted by the Chula Vista City Council which address the need for industrial development, as well as related goals and strategies for encouraging industrial recruitment and expansion. In order to put this analysis of industrial inventory in context, these existing plans are summarized below. A. CHULA VISTA GENERAL PLAN Land Use Element The General Plan's Land Use Element contains 10 goals. Goal #1 pertains to the "Economic Base of the City," and states the need to "have a large and diversified economic base, while maintaining or increasing the existing sources of employment." Among this Goal's objectives are: Objective 1. ''identify potential areas for location of new light manufacturing and high technology businesses and facilitate their development. " "Where land is currently occupied by marginal industrial uses, encourage replacement by higher value-added users." "Continue the orderly industrial redevelopment of the Otay Valley Road area." "Provide employment opportunities in large scale planned communities such as Eastlake, Rancho Del Rey, Sunbow and Otay Ranch. " The General Plan's Land Use Element defines two industrial land use categories. The land use categories are: Objective 2. Objective 4. Objective 5. Research and Limited Manufacturing: "This category includes research and development, light manufacturing, warehousing, and flexible-use buildings, which combine the above uses with office space." General Industrial: This category includes all uses identified for Research and limited Industrial plus light manufacturing operations, large-scale warehousing, transportation centers, and public utilities. ISSUE PAPER - ADEQUACY OF INDUSTRIAL ZONED lAND IN CHUlA VISTA Page 3 EZ-5 The General Plan land Use Diagram provides for 2,029 acres of Research and limited Manufacturing and 375 acres for General Industrial (see map, Attachment 1). Growth Manaoement Element The General Plan's Growth Management Element identifies the following as one of 6 key concerns: "Expanding and refining the Citys economic structure so as to provide for a healthy, regionally competitive local economy and employment base." This key issue is expanded upon as follows: "Development in the Eastern Territories, Bayfront and downtown revitalization all provide Chula Vista a variety of opportunities to diversify and revitalize the City's mix of commercial and industrial uses, supply local employment for a range of economic groups, and improve its competitive position in the region." One of Chula Vista's more innovative efforts to integrate growth management and economic vitality is the use of 'Economics' as one of the Threshold Standards adapted in 1987. Among the Growth Management "Healthy Economic" policies adopted by Council are: Policy 2.b. "Conduct a periodic economic assessment for the City as a whole to include: 1) Profile of economic structure as relates to ... demographics and employment base 2) Profile of surpluses and deficiencies in local economy... 4) Vacant land available for commercial/industrial/manufacturing development 6) Summary of commercial/industrial development costs and Chula Vista's comparative (competitive) position in the region" B. ZONING ORDINANCE The City of Chula Vista Zoning Ordinance implements the two land Use Categories discussed above. The Ordinance allows four industrial designations. These designations and their allowed uses are listed below: limited Industrial (Il) Manufacturing, assembling and packaging products from previously prepared materials; wholesale business; and laboratories, among others. General Industrial (I) Any manufacturing, processing, assembling, research, wholesale, or storage uses, except those otherwise prohibited. Research Industrial (I-R) laboratories, and manufacturing and assembly of electronic instruments and devices. ISSUE PAPER - ADEQUACY OF INDUSTRIAL ZONED LAND IN CHULA VISTA Page 4 el- ~ Planned Community Industrial (PC-I). Within the master planned commUnities of Eastlake, Rancho Del Rey, Sunbow and Dtay Ranch, this designation allows light manufacturing, warehousing, flexible use buildings, public utilities, limited amounts of restaurants and office-oriented commercial uses. C. GENERAL DEVELOPMENT AND SECTIONAL PLANNING AREA (SPA) PLANS General Development and Sectional Planning Area (SPA) plans for the master planned communities of Eastlake, Rancho Del Rey, Sunbow and Otay Ranch address the need for industrial uses in order to provide employment opportunities. These Plans which are intended to implement the City's General Plan policies define the areas in which industry should locate. Past events and current issues have and are impacting industrial development in these areas and are discussed below. Eastlake I (200 acres) The Eastlake I Sectional Planning Area (SPA) Plan was approved in 1992 as part of a larger development area (3,073 acres). Eastlake I was designed to provide significant employment opportunities to encourage residents to work within their community. The Eastlake Business Center is a two-phase industrial park consisting of approximately 200 acres (see map, Attachment 2a). Phase I (100 acres) is fully improved_ Approximately 70 acres in Phase I have been developed, with 44 acres remaining for sale. Most of these lots are 1-2 acres (see map, Attachment 2b). The adjacent Phase II (100 acres) is ungraded and unimproved. Development within the Eastlake Business Center has been virtually non-existent throughout the early 1990's. This is a result of the national recession and defense cutbacks, reflecting the lack of industrial development throughout the entire county and the state, and also reflects the postponement of SR 125. Since 1996, the demand for industrial property countywide has dramatically increased. In Eastlake, in 1996, Retail Systems International IRSI) purchased a 22,000 sq. ft. building which had been vacant for several years. RSI is now considering expanding further and purchasing additional acreage. A new INS office building is being constructed and there have been recent negotiations with other prospects. However, because many companies (including high tech and biotech) require parcels over 10 acres, Phase I is unable to accommodate them (the largest parcel is 4 acres). Phase II could accommodate these users but is not entitled or improved and, for all practical purposes, has not been offered for sale to industrial users since the economy has shown recovery. The Eastlake Business Center (Phase I and II) has a High T ech/Biotech Zone overlay, approved by Council in 1995. The purpose of this Zone designation was to help market this area to targeted technology-based industries and to offer specialized incentives_ Staff is aware of at least 3 biotech companies currently seeking 30.:':. acre sites, as well as other interested manufacturers. ISSUE PAPER - ADEDUACY OF INDUSTRIAL ZONED LAND IN CHULA VISTA Page 5 E2-7 Rancho del Rev In 1985, the Rancho del Rey SPA I plan was adopted and set aside 84 acres for the Rancho del Rey Business Center in order to provide jobs for local residents. In 1992, during the peak of the recession (County unemployment was at its highest since 1980), and with the Business Center stalled, 55 acres were rezoned to commercial. The resulting "power center" anchored by Home Depot, Price Club and K-Mart, created 1,220 new jobs and has generated approximately $1.2 million in net new sales tax revenue annually. There are only 11 acres of industrial property remaining. With the market pressures to develop these "in fill" parcels as commercial uses, these acres may face elimination in the future. Sunbow II (602 acres): The General Development Plan for Sunbow " was adopted in 1989 and the Sectional Planning Area (SPA) Plan was adopted in 1990. A 46 acre research/development and light industrial park site was planned, estimated to generate 2,800 jobs. Negotiations are currently ongoing to convert approximately 50%, or 23 acres, to a recreational use. This limited amount of contiguous acreage (23) presents major obstacles to the development of a business park. Otav Ranch 19,100 acres in Chula Vista): Most of the industrial land uses in the otay Ranch General Development Plan are located on the otay Mesa within the City of San Diego. Within Chula Vista, 232 acres are designated for light industrial uses in Planning Area 18b and Village 3 located on both sides of Paseo Ranchero, north of otay Valley Road (see map, Attachment 3). Business Park uses (primarily R&D type) are Dermitted within the 236 acre Eastern Urban Center (EUC), adjacent to SR 125. This intense urban area is envisioned to accommodate regional retail. office and some residential in mid to high-rise structures. Villages 9 and 10 have been set aside for a university campus (698 acres). Research and development uses are also Dermitted in Villages 9 and 10, along with support commercial and residential, if tied to the Universitv. (While industrial uses are permitted in the EUC and in Villages 9 and 10, no acreage has been identified for these areas. Therefore, there is no guarantee regarding future availability for industrial use except for within the 232 acres of Planning Area lSb and Village 3. The primary obstacles to near-term industrial development in the otay Ranch are lack of entitlements and infrastructure, as well as mixed ownership and uncertainty regarding the owners' future plans. Most recent communication by staff with the representatives of the owners of Areas lSb and Village 3 indicates no near term plans to develop. As a result these properties are not currently deliverable. ISSUE PAPER. ADEGUACY OF INDUSTRIAL ZONED LAND IN CHULA VISTA Page 6 E2. - e:, D. REDEVELOPMENT PROJECT AREA PLANS 1. Bavfront The Bayfront Redevelopment Project Area (see map, Attachment 4) was adopted in 1974 to address blighting conditions including degradation of the coastal environment. depreciated property values, soil and water contamination, and the lack of public improvements. The project area includes a variety of land uses including industrial. office and commercial. The Bayfront Redevelopment Plan expires in 1999. Currently, the Plan is being amended to extend the life of the Plan to 2014 and to expand the boundary to include the adjacent tidelands owned by the Port District. The existing Bayfront Redevelopment Project Area, comprised of the Midbayfront, most of the Rohr campus, and SDG&E, combined with the Project Area expansion, i.e. the Tidelands properties, provides a tremendous economic development opportunity. It also poses major challenges. Impediments to development in the Bayfront include ongoing multiple replanning efforts, environmentally sensitive habitat, Coastal Commission and other entitlement requirements, lack of infrastructure and access, possible contamination, incompatible uses and visual blight. Access and circulation issues are also problematic, including the lack of linkages between the northern and southern Bayfront properties. In terms of the Midbayfront. the current lCP and Specific Plan require extensive environmental mitigation, development of public improvements, and long-term mitigation monitoring which may hinder the ability to create a feasible development proposal. Any major deviation from the approved local Coastal Plan (lCP), General Plan and/or Redevelopment Plan will require additional environmental study and appropriate amendments. In regards to the Tidelands area, two separate planning processes are currently underway: 1) the Port District Master Plan Amendment, lCP Amendment and related EIR for 80 acres (50% of Tidelands property) to expand allowed industrial and commercial uses; and 2) the Redevelopment Agency's expansion of the Bayfront Redevelopment Project Area to include all of the Tidelands, and the related EIR (for the area not covered by the Port's EIR). These planning efforts are complex and potentially conflicting, and inject significant uncertainty into the near-term development process. Development of the area south of H Street to be vacated by Rohr is also complicated by possible contamination issues, the need for demolition, an SOG&E easement which runs through the property, and the presence of high tension wires_ Further, contributing to the uncertainty are questions pertaining to Rohr's recent sale to B.F. Goodrich and how that will impact the Rohr facility's future in Chula Vista, Rohr's closing of operations south of H Street, and/or the planned extension of H Street to Marina Boulevard. ISSUE PAPER - ADEUUACY OF INDUSTRIAL ZONED LAND IN CHULA VISTA Page 7 Ez-q Preliminary discussions among the various Bayfront stakeholders have identified the need for a re.master planning of the entire Bayfront area. There are also preliminary environmental planning efforts beginning for the South San Diego Bay Refuge, an area shown in Attachment 5. All these issues hinder the ability tD deliver a specific BayfrDnt site tD an industrial user today with any assurance Df its feasibility, timing Dr CDSt. They alsD put intD questiDn hDW much land will be available fDr industrial uses in the future. An enormous opportunity exists with the SDG&E site (approximately 150 acres). With the prDspect Df a sale by ENoV A, the City needs tD evaluate what future land uses shDuld be allDwed, and whether Dr nDt high tech (Dr Dther) industry shDuld be included. 2. Otav Vallev Road In 1983, the Otay Valley Road Redevelopment Project Area was formed to eliminate blighting conditions which were impacting industrial development in the area (see map, Attachment 6). When the Project Area was adopted in 1983, this area represented the largest resource of underdeveloped urbanized property in the City zoned fDr industrial development (322 acres). Although industrial development has occurred and progress has been made to reduce blighting conditions in the project area, impediments to industrial development remain, including hazardous waste, changing and incompatible uses, traffic and access issues, and environmentally sensitive habitat. Several projects in the Otay Valley Road region (both in the Project Area and adjacent to it) have resulted in the loss of over 120 acres of industrial land, these include the Auto Park, the White Water Canyon theme park and the MCA Amphitheater. These projects have created a new cDmmercial/entertainment synergy in the area that may influence future develDpment Df the remaining 120 industrial acres in the Otay Valley/Otay RiD area as well as the future develDpment Df the industrial area in Otay Ranch, Village III and 18B (232 acres). Phase I of the Auto Park (within the Project Area) converted 20 acres and Phase II is expected to convert between 20.30 additional industrial acres. The Otay Rio Business Park (adjacent to the Project Area) encompasses 130 acres and was designed as a master.planned industrial park with IDts ranging between .7 to 4 acres. Approximately 100 acres have been converted fDr the White Water Canyon theme park and the future MCA Amphitheater. (Recreational uses were allowed with Conditional Use Permits.) There are approximately 30 industrial acres remaining which are owned by the Water Park, and which will likely be converted to cDmmercial zDning to accommodate water park expansiDn or a cDmplimentary recreational use. ISSUE PAPER - ADEQUACY OF INDUSTRIAL ZONED lAND IN CHUlA VISTA Page B E2. - ID 3. Southwest In 1990, the Southwest Redevelopment Project Area was created in order to eliminate blight which negatively impacts industrial and commercial development and to implement the Montgomery Specific Plan (see map, Attachment 7). Blighting conditions in the project area include inadequate public improvements; non.marketable properties due to poor access, inadequate lot sizes and shape; deteriorated commercial. industrial and residential buildings; incompatible mixed land use; and visual blight. An economic, land use, and zoning study is being prepared which is intended to examine and provide recommendations focused on revitalization of industrial and commercial properties along Main Street and Third Avenue. Opportunities to interface with the future Otay Valley Regional Park may provide increased interest in areas south of Main Street. Planned economic development efforts include creating loan and/or grant programs geared towards small business owners, Main Street widening, and redevelopment of Agency.owned parcels on Broadway. III. ONGOING INDUSTRIAL DEVELOPMENT EFFORTS The Community Development Department offers businesses site selection, financial, permit processing, job training and other market.related assistance. The Department has been promoting industrial development, in accordance with the City's Economic Development Plan and Redevelopment Plans, for many years with initiatives such as the High T echlBiotech Zone and the Border Environmental Commerce Alliance (BECAJ, in addition to citywide image enhancement efforts, business attraction and assistance programs, and redevelopment activities. These efforts have been predicated on assumptions related to the availability of aoorooriate. develoDable industrially zoned land. The current lack of industrial inventory suggests the need to reevaluate our short.term industrial recruitment strategies and related marketing efforts, address short.term land use conversion proposals, andfor augment and upgrade our industrial land and building supply over the long term. A. CHULA VISTA ECONOMIC DEVELOPMENT PLAN The City's adopted Economic Development Plan specifically addresses the importance of industry to Chula Vista. The Plan's Mission Statement is: "To enhance the quality of life in Chula Vista through the promotion of a strong local economy offering employment and business opportunities, and a healthy, diversified tax base vital to supporting city services." Among the Plan's six goals are to: 1 . Identify the existing economic base and target new business and industry 2 . Develop land use and infrastructure strategies to support economic development goals 3 . Develop a comprehensive marketing and public relations program to attract job and revenue generating business and industry ISSUE PAPER - ADEQUACY OF INDUSTRIAL ZONED LAND IN CHULA VISTA Page 9 62-/1 4 . Develop a proactive business assistance program to encourage business retention, growth and expansion B. BUSINESS DUTREACH ACTIVITIES The City's adopted Economic Development Marketing Plan reflects the Council-adopted Economic Development Plan's Goals and Dbjectives. Industrial business outreach efforts to date have been based upon the following assumptions: 1) Chula Vista wants to recruit desirable industry and to help local businesses to expand and prosper 2) Chula Vista has the ability to "deliver" these businesses land suitable for development (physically and economically) The City's Marketing Plan includes general image enhancement and business attraction activities. Examples include "image building" advertising, press releases, promotional video, attendance at trade shows, etc. These types of activities contribute to both the City's visibility/name recognition, and to a more positive profile, and benefit its commercial, residential and industrial development efforts on a long term basis. Additionally, the City, for the past several years, has undertaken targeted marketing activities to reach our targeted industry clusters . environmental technology businesses and biotech manufacturers. Specifically, the City has promoted BECA services and the High Tech/Biotech Zone sites and incentives to these targeted audiences. Staff suggests that the City's business attraction efforts be reevaluated in light of the current shortage of deliverable land. In particular, marketing of the High Tech/Biotech Zone needs reassessment in light of the shortage of deliverable industrial parcels larger than four acres. C. HIGH TECH/BIDTECH ZDNE Chula Vista's High Tech/Bio Tech Zone is an incentive program that was developed by a Task Force of staff, biotech industry experts and the EastLake Development Company, and chaired by the Mayor. The Zone was formally created by Council (by ordinance) in 1995 and is comprised of the Eastlake Business Park, Phases 1 & 2 (2DD acres). The Zone was designed to encourage high technology industries, including biomedical and biotechnical manufacturing companies, to locate in Chula Vista. The program offers advantages such as expedited development review, uninterrupted water supply, negotiable financial assistance, and the planned Western Regional Bioprocessing Center (WRBC), a shared-use, biotech contract manufacturing and training facility. The High Tech/Biotech Zone was proactively planned to meet the needs of San Diego Biotech R&D companies transitioning into manufacturing. This was projected to occur in 3.5 years from the Zone concept's inception. The Task Force's projections were "on target" . demand for biotech ISSUE PAPER. ADEQUACY OF INDUSTRIAL ZONED LAND IN CHUlA VISTA Page 10 cz -/2.. manufacturing space is now emerging. Within the past year, staff has been aware of 3 San Diego biotech R&D companies seeking sites for their first manufacturing plant. Each requires approximately 30 acres. Because of the multi-year, public/private planning effort to proactively position ourselves to compete successfully for these highly desirable firms, we are now experiencing requests by biotech and other technology firms to be shown sites in the EastLake Business Center. Unfortunately, Phase I lacks adequately sized parcels for most of these users and Phase II, for all intents and purposes, has not been available since the demand has emerged. D_ WESTERN REGIONAL BIOPROCESSING CENTER (WRBC) The WRBC has been planned as the corner stone of the City of Chula Vista's High Tech/Biotech Zone at the EastLake Business Center. WRBC is being organized as a non-profit scientific research organization with two primary functions: to provide specialized biopharmaceutical manufacturing education, training and research programs, and to promote regional economic development. As planned, WRBC will offer biopharmaceutical research, development and production services to the pharmaceutical industry. San Diego State University and the 22-campus California State University Program in Biotechnology Education and Research (CSUPERB) will administer the academic and training programs at the Center. The WRBC will provide essential infrastructure to support the industry's transition from R&D to commercial manufacturing, including contract manufacturing services for pilot scale product. The City's active support of the WRBC (including seed capital funds and extensive staff time over the past few years to assist with planning, marketing, corporate sponsorship and grant solicitation, site selection, etc_) has been predicated upon a strategy which envisions the WRBC as a catalyst to create spin-off demand for land by biotech manufacturers within the EastLake Business Center (High Tech/Biotech Zone). With new indications that the property owner will be seeking to rezone all or a portion of Phase II to non-industrial uses, the value of this strategy is negatively impacted. E. BORDER ENVIRONMENTAL COMMERCE ALLIANCE (BECA) BECA was formed to create and retain regional jobs in the environmental technology industry and to encourage the development of an Environmental Industry Cluster in Chula Vista. BECA has been designed to further this strategy by: 1) assisting the transfer of new cost-saving and innovative environmental technologies to existing industry; 2) supporting the commercialization and export of new environmental technologies and products; and 3) fostering the "incubation" of start.up environmental companies. As a unique entrepreneurial effort, BECA has faced numerous challenges, but is moving forward and showing much promise. In March 1997, BECA received recognition by the U.S. Economic Development Administration for BECA's successful and innovative public/private partnerships in support of defense conversion efforts in the western United States. Our first successful "graduate" is Metallic Power, the developer of pollution-free, metal/air fuel cells. With ISSUE PAPER - ADEQUACY OF INDUSTRIAL ZONED LAND IN CHULA VISTA Page 11 ez. - I b City assistance. Metallic Power moved from the BECA incubator into its own facility in south Chula Vista. Currently, BECA has 24 tenants in their incubator with an additional 5 on the waiting list. The availability of industrial land (and buildings) for BECA incubator graduates and business affiliates (clientsfjoint venture partners, etc.) is critical to the City's goal to create an environmental industry cluster here in our City. Unless we can offer readily available inventory at competitive rates. our "incubated" businesses will locate their manufacturing plants and offices elsewhere. F. REDEVElOPMENT ACTIVITIES The Redevelopment Agency proactively assists in revitalizing blighted and underutilized land within five Project Areas in the community. Three project areas include industrial uses: Bayfront, Southwest and Dtay Valley Road. Each of these areas are facing challenges to industrial development. as examined previously in Section II C. IV. INDUSTRIAL LAND SUPPLY IN CHULA VISTA A. TOTAL SUPPLY AND PROJECTED NEED Staff has evaluated the City's available industrial land supply and estimates a currentinventory of approximately 180 to 266 acres of improved properties and 280 acres of unimproved properties. These numbers, however, are misleading in that they include ill! industrially zoned parcels regardless of impediments to development. As previously noted, staff is experiencing difficulty in being responsive to business prospect needs due to a shortage of properties which are both readily developable and meet the companies' site requirements. Currently, the city is experiencing a shortage of improved, entitled sites. a shortage of large parcels and of upscale business park settings, as well as challenges in delivering sites that are competitively priced. The vast majority of industrial parcels are less than five acres in size which are inadequate for many users. For the most part, the only readily deliverable sites are limited to the 20+ acres in EastLake Business Center Phase I (these parcels are a maximum 4+ acres in size ) and a few parcels in the Bayfront, Southwest and Otay Valley Road areas. In 1993, the City contracted with Williams-Kuebelbeck & Associates (WKA) to prepare a citywide market assessment and to develop strategies for business targeting. The study identified a 39 year industrial land supply in Chula Vista. The consultant recommended that the City consider increasing its industrial-zoned land to a "50 year" supply, an additional 190 to 200 acres. Since 1993, the City's supply of industrial land has significantly diminished due to rezonings to accommodate other non-industrial uses (due to market demands, changing economic conditions and the need to generate sales tax dollars). Based upon the WKA analysis. these reductions in supply result in the current ISSUE PAPER - ADEQUACY OF INDUSTRIAL ZONED LAND IN CHULA VISTA Page 12 e 2. -/4 need for an approximate 474 acres of additional industrial land. Past losses, as well as anticipated future losses are summarized below: INDUSTRIAL AREA LOSS OF INDUSTRIAL LAND SINCE 1993 Rancho del Rey 73 acres Otay Rio 100 acres Eastlake Business Center 71 acres (proposed) Sunbow 23 acres (proposed) Otay Valley Road 20 acres (Phase I of Auto Park) 30 acres (proposed Phase II of Auto Park) TOTAL 317 acres The table on the following page provides a more detailed citywide overview of industrial acreage as it currently exists and as projected. As noted, the chart shows approximately 180-266 acres of improved properties and 280 acres of unimproved properties. However, the chart includes all industrially zoned parcels, including unimproved sites, infill sites, and sites with major impediments to development (e.g. irregular size or configuration, toxic contamination, lack of infrastructure, high assessments or land cost, etc.). ISSUE PAPER - ADEQUACY OF INDUSTRIAL ZONED lANO IN CHUlA VISTA Page 13 - € 2. - I';;) TOTAL VACANT INDUSTRIAL LAND - IMPROVED AND UNIMPROVED EXISTING EXISTING IMPROVED UNIMPROVED ANTICIPATED CHANGES Western Area: Improved Unimproved Central 18 111 0 0 8ayfront 45 121 1451 to 0 +21 131 Montgomery 92 141 0 0 Eastern Area: Improved Unimproved EastLake 40 80 1181151 1551151 Rancho Del Rey 11161 13) Otay Rio 32 132)111 Otay Valley 90 50 150 to 150)191 130}18I Otay Ranch 118b 232"01 0 & Village 3) Sunbow 46 123)1111 TOTALS 328 408 (148) . (62) (128) PROJECTED NET IMPROVED ACREAGE PROJECTED NET UNIMPROVED ACREAGE o o o 25 o o o 232 23 280 111 Majority of parcels are located near Highway 54 121 Figure does not include Rohr campus south of H Street lapproximately 65 acres) or SDG&E plant lapproximately 145 acres} 131 Tidelands are being rezoned, by the Port District, to a broader classification in which industrial development is not assured. 141 Includes West Fairfield and Southwest Redevelopment Area 151 9 acres of Phase I are being optioned or are in escrow; and WRBC is proposing to acquire approximately 9 acres. EastLake has expressed interest in rezoning 55 acres of Phase II to residential. 161 Originally B4 acres, 70 were rezoned to commercial for Rancho del Rey Power Center 111 32 acres are held by the Waterpark and will most likely be used for recreation or entertainment 181 20-30 acres are planned for Phase II of the Autopark; an estimated 20 acres may be rezoned for support commercial 191 All parcels have significant environmental constraints, including coastal sage and wetlands, which make development impractical 1101 Zoned Planned Community Industrial. allowed uses include light manufacturing, warehousing, flexible use buildings and public utilities and will be further defined in the SPA 1111 Half of the acreage in Sunbow may be rezoned for park use ISSUE PAPER - ADEQUACY OF INDUSTRIAL ZDNEO LANO IN CHULA VISTA Page 14 ez -It., B. LACK OF LARGE PARCELS The shortage of available industrial land is exacerbated by the fact that the vast majority of the available parcels are under 10 acres, which precludes many types of industrial users such as biotech and high tech manufacturers. The chart below shows the number of industrially zoned parcels in the City by size categories. Only 14 industrially zoned parcels in the City are over 10 acres. Additionally, only 24 parcels are over 5 acres (see Attachment O), and of these only 15 are readily developable (see table on following page). # OF VACANT INDUSTRIAL PARCELS BY ACREAGE Western Area: < 1 ACRE < 5 ACRES < 10 ACRES 9 4 3 6 41 153 5 10-20 20-30' ACRES ACRES 30+ACRES' TOTAL > 10 ACRES Central Baytront' Montgomery Eastern Area: Eastlake Phase I & II Rancho Del Rey Otay Valley Otay Ranch (18b & Village 31' Sunbow'. , 13 12.4 4" 1 1 1 111 2 8 3 3 14 12 3 17 TOTALS 65 63 10 1 All parcels are unimproved , May be developed commercial or residential J Majority ot parcels are under 2 acres 4 Business Park Phase II, approximately 80 acres 5 All parcels have substantial environmental barriers, including coastal sage and wetland area 6 200 + acres owned by SNMB, Inc. ISSUE PAPER. AOEaUACY OF INDUSTRIAL ZONED LANO IN CHULA VISTA Page 15 E2. - 17 PARCELS 5 ACRES OR LARGER NUMBER OF TOTAL AREA (see Map, Attachment 8) PARCELS ACREAGE EastLake Phase I 1 5.5 Rancho Del Rey 1 5 Bayfront 3 27 Central 1 5 Otay Valley Road 3 36 Southwest 6 45 Totals 15 114.5 C. LIMITED BUSINESS PARKS The EastLake Business Center is the only master. planned, upscale business park currently in Chula Vista. Phase I is fully improved. Challenges are the current lack of freeway access (which will be remedied with SR 125) awl the need for planning, entitling and building infrastructure for Phase II. D. OTHER IMPEDIMENTS TO DEVELOPMENT In addition to the lack of large parcels, much of the available industrial property has other constraints to immediate development, including: scattered, small, and irregular parcels environmental contamination grading issues (cost and timing) incompatibility with adjacent uses limited access lack of entitlements; extensive environmental analysis required expensive assessments need for demolition lack of infrastructure environmental sensitivity Impediments as they relate to each area in the City are detailed in Section II. While efforts are being made to address these issues. the current reality is that there is a very limited supply of deliverable. marketable large industrial parcels. E. PROPOSALS WHICH COULD FURTHER ADVERSELY IMPACT INDUSTRIAL LAND SUPPLY As discussed in various sections above, staff is aware of certain ongoing or anticipated proposals which could further reduce the availability of industrial property and further limit the City's ability ISSUE PAPER - ADEDUACY OF INDUSTRIAL ZONED LAND IN CHULA VISTA Page .'6 E2 -16 to respond to ongoing, as well as future business demands. Pending applications cannot be discussed here. Other proposals in the discussion stages are summarized here: Eastlake Business Center Phase II (100 ac.) There has been discussion by Eastlake over the past year regarding the possibility of requesting a rezone of all or a portion of Phase II of the Eastlake Business Park to non-residential uses. This would eliminate up to 50% of the High T ech/Biotech Zone (Phase I and II) and the availability of ~ industrial parcels larger than 4 + acres. (Most recent discussions suggest that Eastlake is considering requesting a Phase II rezone of 70 + acres, leaving approximately 30 acres for industrial uses.) Eastlake has discontinued its joint marketing efforts with the City pertaining to the High T ech/Biotech Zone and has referred City business prospects seeking sites larger than can be accommodated in Phase I to other properties. Sunbow (40 ad Negotiations are ongoing to rezone half of the industrial acreage for development of a park_ V. INDUSTRIAL DEVElOPMENT TRENDS A. SAN DIEGO REGION Historically, the San Diego region's industrial base was comprised of manufacturers with military and aviation contracts. With the advent of defense spending cutbacks, and corporate down-sizing, we have seen long time San Diego companies such as General Dynamics disappear, and companies such as Rohr decrease from 7000 employees to 2000. These losses have created a shift in focus to non-defense related, technology-based companies. Industries such as computer science, biotechnology and telecommunications, mere infants 10 years ago, are now becoming the new industrial giants. Companies such as SAIC and Oualcomm provide thousands of jobs and are still growing. The San Diego region has an opportunity to transform itself into a globally competitive, international economy. The San Diego/Tijuana region has become the television production capital of the world. San Diego's export sales volume has grown 361 % over the past several years - a rate of growth that exceeds both Los Angeles and San Francisco. San Diego's Gross National Product increased to a record $79 billion in 1996 and is projected to grow to $85 billion in 1997. This rate of growth is expected to exceed both the State and the nation. During the recession, due to lack of demand industrial property throughout the County was being rezoned for commercial use. In the past two years demand for industrial land has gone from approximately 5 acres per year to 700 acres per year. The following graph shows the dramatic increase in the industrial and R&D market: ISSUE PAPER. ADEQUACY OF INDUSTRIAL ZONED lAND IN CHUlA VISTA Page 17 €Z - I q San Diego County Industrial/R&D Market Historical Construction Activity 1990 - 1996 2,000,000 1,800,000 1,600,000 1,400,000 - 1,200,000 '" '" ... '" 1,000,000 ... '" " 800,000 0" (fJ 600,000 400,000 200,000 0 .........-.....--.......--........-.....--.....-......-....... ...................... -.......... .....-....... .............. .......--......-- --.......---.....--.......--............. .....-....-.......... -..........-........--.................... .......n... ....._--.......--........... .-............... ......-.--...... -......_-....... --....-.............. ..........-. .............. .........-............ t990 1991 1992 1993 1994 1995 1996 [ II Under Construction o Planned According to Grubb & Ellis, as the return of speculative and build-to-suit projects increases, companies will find a shortage of land available for new development, especially high-tech and bio- tech companies. Very little land is available in the County that meets their needs per Grubb and Ellis. The only 20 + contiguous acres available for construction are in the Parkway Business Center in Poway, Eastlake in Chula Vista (in Phase II) and Otay Mesa in San Oiego and the County. Although, as earlier indicated, the status of Eastlake Phase II is not certain. B. SOUTH BAY Grubb & Ellis projects that the Southbay submarket will continue to post positive building and land absorption rates and decreasing vacancy rates due to the growth of maquiladora manufacturing operations in Tijuana. Mexico's currency-related export boom and NAFTA-related influx of Asian manufacturers are generating more business for South Bay suppliers and service firms. ISSUE PAPER. ADEQUACY OF INDUSTRIAL ZONED LAND IN CHULA VISTA Page 18 f3l. -2.D Otav Mesa The 20.600 acre Otay Mesa area is located south of Otay Ranch adjacent to the International Border. Approximately 6.200 acres are zoned industrial. The western portion of the Mesa is within the City of San Diego and the eastern portion is within the County of San Diego.. Historically. the area was utilized for farming and grazing. A navy communications facility. County Detention facility, Donovan State Prison and Brown Field are located on the Mesa. Currently a master planning and redevelopment effort is underway to develop San Diego Air Commerce Center, an air cargo facility, at Brown Field. The re-vamped airport will include support services. commercial office. and airport-related industrial. The Otay Mesa area is planned to provide large space for light industrial users which produce relatively low traffic volume (100 AOT s or less)_ Some service uses will be allowed as accessory uses, but very little residential is planned. Most of the industrially zoned property on the Mesa is unimproved and not available for immediate development. There are approximately 300 acres which are improved and available and range in cost from $4.00 to $6.00 per square foot (excluding assessments. averaging an additional $2.00 psf). Chula Vista Demand for industrial land and buildings is significantly increasing. According to Grubb & Ellis, National City/Chula Vista had the highest level of industrial building absorption during the fourth quarter of 1996 within the Metropolitan San Diego area. Over 376,000 square feet of building space were absorbed during that quarter for a total of 519,845 sq. ft. in 1996. The overall industrial building vacancy rate for National CitylChula Vista fell from 17% in 1995 to 7% 1996. After multi-year City efforts to develop and implement strategic. targeted business attraction programs (BECA. High T ech/Biotech Zone. etc.), as well as general business outreach efforts, staff is now experiencing difficulty in identifying deliverable sites to meet current demand. The 1993 WKA Market Study concluded that the Otay Rio Industrial Park. Eastlake Business Center. and Otay Ranch represented the City's best opportunities for attracting new businesses. With the loss of Otay Rio, potential loss of all or a portion Eastlake Phase II. and the long term nature of Otay Ranch, there are currently very limited near-term industrial site options. VI. HOW CAN CHUlA VISTA ADDRESS THE INDUSTRIAL lAND SHORTAGE? A. OTHER CITIES' APPROACHES As the supply of industrial land continues to diminish, land prices and rental rates will continue to rise_ The negative impacts created by insufficient industrial land and/or increasing land prices and rental rates include: businesses relocating outside the region; fewer new businesses being attracted; ISSUE PAPER - ADEQUACY OF INDUSTRIAL ZONED lAND IN CHUlA VISTA Page 19 E-z. -21 lower tax revenues; rising costs to businesses (putting them at a competitive disadvantage); and potential decreases in employee wages. These impacts will cumulatively cause an erosion in the economic and physical quality of life of the San Diego Region. Community leaders need to take action to mitigate these impacts which are directly linked to the lack of induslrialland supply. Several cities in the region and in California are creating and implementing strategies to keep and attract industry. Some examples include: . The City of San Diego, as part of their Zoning Code Update, is considering measures which would increase the industrial area; preserve the remaining industrial stock; and modify commercial zones to allow for limited light.industrial uses. . The City of San Diego is also attracting high tech users (researchers, service providers, telecommunications and software) to downtown. New tenants downtown include Advanced BioResearch Associates, Nationwide Communications, and Wright Strategies, a software firm. · The City Council of Oceanside recently adopted a 24 point action plan that will make the City more "business friendly". As part of the plan, the City zoning ordinance will be made more flexible and is proposed to allow limited light.industrial uses in commercial areas. . The City of San Jose is taking aggressive measures to attract "clean" high tech users, typically bound for the evermore scarce suburban industrial parks, to downtown San Jose. Adobe Systems, a leading manufacturer of computer-graphic software, opened a 400,000 square foot high-rise office building in downtown. The company is currently building a 280,000 square foot facility next door. The Adobe project brought 1600 new jobs to San Jose. B. EXISTING POLICIES REGARDING CONVERSION OF INDUSTRIAL lAND The Chula Vista Economic Development Commission (EDC) expressed concern regarding the industrial land supply via letters to Council dated September 14, 1992 and October 15, 1996. In 1992. the EDC communicated their concern regarding the apparent lack of an adequate supply of vacant land zoned for industrial development. and the rezoning of industrial properties to commercial. Council directed staff in 1993 to prepare a draft policy addressing the following concerns; replacement of rezoned industrial property, provision of industrial acreage in each planned community, and council approval before any negotiations of rezoning industrial acreage occurs. A draft industrial zoning policy was brought to council in 1994 relating to land use proposals which involve a General Plan Amendment from Industrial to another land use; rezoning from industrial to another zone, or a Conditional Use Permit which would allow a non-industrial use in an industrial zone (see Attachment 9). The proposed policy entailed the following process: 1) early notification of Council regarding the land use proposals; 2} staff review of the potential for significant fiscal or economic impacts to the City; 3) if significant impacts are identified, preparation ISSUE PAPER. ADEQUACY OF INDUSTRIAL ZONED LAND IN CHULA VISTA Page 20 E2..-Z~ by the applicant and/or staff of an economic impact analysis for submission to the Planning Commission and City Council; and 4) input from the Economic Development Commission, if requested by the applicant or staff. A formal policy was not enacted; however, in most cases, projects involving industrial land conversions were brought to Council for formal action as a requirement of the entitlement, or via an Information Memorandum. In 1996, the EDC again stated their belief that the diminishing supply of industrial land will impact the City's future ability to attract businesses in manufacturing, distribution, research and development, and high-tech. The EOC suggested that Council direct staff and the Planning Commission to formulate a policy addressing the replacement of industrial land so that the City is prepared to accommodate large industrial users. C. STAFF RECOMMENDATIONS Staff suggests that Council evaluate and address the industrial land supply from both a short. and long-term perspective. Short- and long-term issues and recommendations are outlined below: Short-Term Recommendations: That Council: 1) Affirm the City's desire to preserve the High Tech/Biotech Zone by maintaining an industrial land use designation in both Phases I and II of the Eastlake Business Center; 2) Direct staff to study the feasibility of creating industrial overlay zones and/or amending the existing zoning ordinance to allow for limited light industrial uses within certain commercial areas throughout the City; and 3) Direct staff to analyze the impact of proposed industrial land use conversions utilizing the 4-step process described in Section B above. long-Term Recommendations: 1) That Council direct staff to prepare a report which addresses: a) the need to preserve existing industrial stock via an adopted policy; b) the potential of redesignating areas of the City to industrial land use. 2) That Council provide staff with their vision as relates to the future role of industrial development within the Bayfront, Otay Valley Road and Southwest areas in order to help staff tailor ongoing and future economic development promotional activities. ISSUE PAPER - ADEQUACY OF INDUSTRIAL ZONED LAND IN CHULA VISTA Page 21 E2.-2.~ Sources: Publications: Southern California 1997 Real Estate Forecast, Grubb & Ellis Property Solutions Worldwide, 1997 Grubb & Ellis Company Industrial Market Analysis San Diego County Fourth Quarter 1996, Grubb & Ellis Property Solutions Worldwide State Route 125 South Tollway, SANDAG, Winter 1997 An Economic Development Strategy for the San Diego Region, San Diego Regional Economic Development Corporation, 1997 Economic Development Handbook, league of California Cities and California Association for local Economic Development, 1997 Regional Economic Prosperity Strategy, San Diego Association of Governments, October 1995 Charting a Course for the 21 st Century A Slrategic Economic Plan for San Diego's "New Economy", December 1996 Incentives A Guide to an Effective and Equitable Policy, National Council for Economic Development, April 1996. San Diego's Regional Progress, San Diego Gas & Electric and the San Diego Regional Economic Development Corporation, Summer 1997 Building Economically Competitive Communities A White Paper on local Economic Development, California Association for Economic Development, March 1995 linkages: San Diego's Partnerships for a Strong Economy, Employment Development Department, May 1995 The Race to Recruit Strategies for Successful Business Attraction, California Association for local Economic Development, 1996 City of Chula Vista Documents Council Agenda Statement, Item 20B, 12/5189, Public Hearing: PCM-89-7 and PCl-87-E; Consideration of a General Development Plan and Planned Community Pre-Zone for Sunbow II ISSUE PAPER - ADEQUACY OF INDUSTRIAL ZONED LAND IN CHULA VISTA Page 22 t3"z-Z+ EastLake II (EastLake I Expansion) General Development Plan, Approved by Resolution No. 18159, December 12, 1995 EastLake I Sectional Planning Area (SPA) Plan, Approved by Resolution 16702, June 30,1992 Planning Commission Statement, November 18, 1992, Public Hearing: Resolutions GPA-93-01, FSEIR-92-02, PCS-92-05, PCS-93-01 - Consideration of General Plan Amendment, Final Supplemental Environmental Impact Report, Rancho del Rey SPA I Plan Business Center Amendment Five Year Implementation Plan for the Bayfront Redevelopment Project. Adopted December 12, 1994 Five Year Implementation Plan for the Otay Valley Road Redevelopment Project. Adopted December 12. 1994 Five Year Implementation Plan for the Southwest Redevelopment Project, Adopted December 12, 1994 Otay Ranch General Development Plan. October 28, 1993 City of Chula Vista General Plan, Adopted July 11, 1989 City of Chula Vista Economic Development Plan. Adopted August 28, 1991 City of Chula Vista Socioeconomic & Market Assessment, July 23, 1993 Business Targeting and Development Strategies. September 7, 1993 ISSUE PAPER. ADEGUACY OF INDUSTRIAL ZONED LAND IN CHULA VISTA Page 23 1:2 -Z~ C> rn c::>Z _ rn :~ ;;0 C> :> "" .- :>- ~--o' .- :> Z c s ~n i e~ '!~~ i ~~~~~\Y a;P: ~ ~ o Z r-n C) r-n r- 11 1'1 [~1'1 ;: ~:z ,",0 ~c:: '" ~ ~ ~1i ~~ ~~ ?'....::'~;:>- - - - [' [' ~ ~ ~:;;:~;; ~b: 0. I [) U ~ILJ 0; ?; i' .5.5'~ ~ ~~ ~ ",..,,- -.... . c: <=<.<:13:: 3:: ~ 3 "::t :t cc . . ~ - - - - - nUID ~ ~ ~ ...... <: ~... 3""i ~ '" ::J.... ~ g~ :-;;: .. 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PE"IMANENTE/ ~. ) Y PARK - ::cE~ ~ "'1 3' 4 .1 i , - "" 24 ".' --_c~o_-:-c - ;0 -, t } , +-: ~_ / / f ~,,~ ;~:..'Z ---S.cr?/ \ NE_CC~ INC 1~1 r' L J ^ -______,h',,~-'" ,,-/,'~/' , " -' +-----___-l>,.;;Z$~~>+&"1-"~}23''\~.1 \ \r~~ -f~'> : -............ ,,':.;~~1,: ~1,l' :): 21 \ ~-' -- --=--__--1-; I ~ ,,'" '<" ?" \,.....- ___ r-;:::,-"'e1:E: V ;(i'\ "'-/ .\. /v'.', y /'~ \ I- ':~"'I ~ "',"<\~\~/22~:_Y/~3F'\~E \:.' \_-- >--1 '.. ~ 'j)~ \\ \.-0_'l-C:'ffiIE~AVE '" I.-' I " ';;Ie \ /.,. - " \ \ \ I ~ \ I(AIS~~~SEpITAL \ \~ t: \ - ;:-~..~ ~ ~,. ~ x4.--':.. \ 1 'I wi S,.E \ "'-,",..-;....' --.f:"--:~734 ,-,.,-iSMMERCE '-\ \. ! ~: \ '~.:.---- ~--~. _ ~/';"---'_iP!..AZAONA \' ; 'tnl \ --- ~ ~..?- ..,__-~ \ \ : w' '/, \ -, 35 ~ \ I (' ~! /--- ~" \ .....:.~--:-:::_---'TH~~~A'( \~ \_ I ___..::..') "I /" \~\ ,>--- ..l., \ \1-.---- / cr: I'" '-?" , _ _ _-7" i "' IS',_=-- >'" 0".... --\ ~_-~~' __-- V : \~' EAS;UKE~ A ---- ___- I '-:<' vIV....GE 7------ :..-_--. .~ CENTER _ --;;? ____ ! I \ _;:/--- , \ \ ~ /----- I EASTLAKE \ A "'"' .....- l VILLAGE CENTER \ \ --<. ::y,<-c, / 1 \ ~~...~ / , .,;;Jo,o 0.-/ PROPERTY: I #~/' '0 i ~,cP" / r\ \. Eastlake Business Center Phase I : /'"\<:: ------- ......... / I / / ---- , / / I / / i // // , / / ), --$> / //..-----(0\-// ,/ L.. <" ~.~ CONTACT: City of Chula Vista PROPERTY DATA SHEET SITE PLAN: /^' (1 ~0 ATTACHMENT 26 c::.;i~ NEIGHBORHOOD SHOPPING CENTER -- Jim Moxham Eastlake Development Co. 900 lane Avenue Suite 100 Chula Vista, CA 91914 (6191421-0127 16191421.1830 FAX Community Development City of Chula Vista 276 Fourth Avenue Chula Vista, CA 91910 (619) 691-5047 (6191476-5310 FAX ADDITIONAL COMMENTS: . 150.acre,$50 million industrial office park with central employee-oriented recreational park , Adjacent to future State Route-125 Build-to-suit facilities available, as well as lot sales . . LOCA nON: Telegraph Canyon Road, east of lane Avenue Building Size: Area: Zoning: Redevelopment Area: Not applicable Lot 1 lot 3 lot 4 lot 6 Lot 18 lot 19 lot 21 Lot 22 Lot 23 lot 24 lot 25 lot 34 Lot 35 approx. 15 acres 2.47 acres 2.24 acres 2.67 acres 4.19 acres 4.81 acres 2.14 acres 2.00 acres 2.18 acres 2.34 acres 2.23 acres 1.00 acre 1.00 acre PC Planned Community Not applicable All information furnished regarding property is from sources deemed reITable although subject to errors. amissians. changes of prices. rental or other conditions. prior sare or lease. or withdrawal without notice. &;1.- AJ, 8-/ 0 ~ () Cj 6' tr = (1) \'S -, ~ Q !!1 - ei: (Q ',' ~ , I (Q i) . " '" -c , <I [ \ I ~." ~ ", ,-! Q. II If , .f 'J., n (,< , c' ~ - ';00. 'j~ C/' L .r:.:>:7 '(S -~-= ~ 11 . ~ W I ... ~t--~,~, ~-*--,~ '; I I ( : ~~ .,..1 i~~~ N " Y'w ~,~. ~' . 3: ~ : .' '1 } .: I . . j , I' '" I ~. 'Ii O.I~ I (/)1 I ---, l( ) ~ '" r\~\C' ~~~I c.-- r'--, 'u rP' - (~ f'J1 ' ~<7 . c-f \ "--- ',> :J-' ~ ( /. ,~ '-',__ \../0 - ~ '" 0\ - t:1 > -I -I > (") :c s: m ;2 -I ... ATTACHMENT 4 BA YFRONT REDEVELOPMENT AREA _ REDEVElOPMENT PROJECT AREA EXPANSION AREA s~" Q\'i.GO ~ ........ ~~-"<<+-I BOUNDARY ALTERNA- '/ES, PROPOSED SOUTH SA DIEGO BAY UNIT SAN DIEGO NATIONAL WILDLIFE REFUGE Alternative A ---- i f\ I ' \, \ \\ , , \ \ \; 1 \' ~ J ,~ 1,\---- "1J "1J h h :n :n 0 0 0 0 (1 (1 rn rn ~ ~ i L__. -, l , 4,994 Acres I \ '- \\ " \\ \', ~ , i , ~ , < \'i\~ 1 Silver Strand State Beach 2 Area Two , )' '& L , 4,722 Acres! 3 M KEG / Fenton Parcel 4 Pond 20 "1J h :n - o o --"....,.--...........- o (1 rn ~ , 2,203 Acres i I , i -,i 3 - L I J_ . fOl_....A 5~L ..._~---- 2 3 Miles ATTACHMENT 5 :DC") (1) _. Q. - ~'< (1) 0 0_ l:J 3- (1) \," ::J::r - 1:- )>- ..., Q) (1) s:u< (j) -. en - Q) ~\:K()ilr~_- \ ~~.', .Y,/ 'C'-i"":""'~,i~~~ .'".' 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CHANNEL The Qvoiiability of t~.. !)rop"rty, land area 5"i1.= ond impreve"",,"I, or., subject to cnon9'" (2) VACANT o VACANT o SOUTH SAY 80AT YARD o RQHR INOUSiRlES o VACANT CD VACANT (2) VACANT ~ VALLE DORADO CD VACANT @ VACANT 9 CHULA VlSTA Rv PARK 9 CHULA IJ1STA. I,1ARINA @ CALIFORNIA YACHT I.1ARINA @ VACANT e VACANT @ w. AND J HAKES w Z o w o = = o = ~ , PARCELS GREATER THAN 5 ACRES e~-A8-;l ATTACHMENT 9 COUNCIL AGENDA STATEMENT Item Meeting Date 617/94 ITEM TITLE: SUBl\1I'ITED BY: Report on Industrial Zoning Policy Director of Planning ;t!Pt Community Development Director REVIEWED BY: City Manager (4/5ths Vote: Yes_No.lO Council Referral No.2728 The City Council has previously directed staff to inform them regarding land use proposals which would result in non-industrial development of property which is zoned for industrial uses. In addition, Council has requested staff to prepare a draft Council policy to address concerns regarding the possible economic and fiscal impacts of such land use changes. The following report addresses these issues, and contains a draft Council policy for preliminary review. RECOMMEI'.'DA TION: It is recommended that Council accept the report, and direct staff to refer the draft Council policy to the Economic Development Commission and Planning Commission for review and comment, prior to final action by the Council. BOARDS/COMMISSIONS RECOMMENDATION: None. DISCUSSION: As indicated above, the City Council has previously directed staff to prepare a draft Council policy regarding industrially zoned land (see attached City Council minutes of 212/93). The three major concerns to be addressed in this policy included: 1) Industrially zoned property within Chula Vista is of high interest to the City Council, with sufficient coverage so zoned to insure the City's ability to retain, recruit, and/or expand manufacturing entities; therefore, industrial acreage considered for zone change. would normally require similar zoning offset elsewhere in the City before approval. 2) Each planned community shall have industrial acreage to ensure that City services are funded within the community, plus 15% to offset recession. 3) No negotiation for the rezoning of industrial property should occur without authorization first being obtained from the Council. . In response to Council direction, staff has kept the City Council informed on various land use proposals which would involve non-industrial use of land which is zoned for industrial E.;J.-AQ-/ Page 2, Item _ Meeting Date 6/7/94 development. In addition, staff has worked with the Economic Development Commission and its economic consultant, Williams Kuebelbeck, to analyze the availability of industrially zoned land in the City. The fInal report by Williams - Kuebelbeck, entitled "City of Chula Vista Targeting and Development Strategies,. was completed and distributed to the Economic Development Commission and City Council in January. The Williams - Kuebelbeck study indicates that the City has approximately a 39 year supply of industrial land, and that this represents an adequate supply for the foreseeable future. However, it also suggested that the City consider a long-term policy to maintain a 50-year supply of industrial land, in the event that economic conditions should change. Notwithstanding the fact that the City has a relatively large inventory of undeveloped industrially zoned property, it is important that any proposals to allow non-industrial use of such property be carefully evaluated to ensure that they do not result in negative economic or fIscal consequences to the City. Therefore, staff is reco=ending consideration of a draft Council policy which would establish an evaluation process for any such land use proposals (see Attachment 2). Briefly this evaluation process would include the following: 1) continued early notifIcation of the City Council of any land use proposals involving: a) a General Plan Amendment from Industrial to another land use category; b) Re-zoning from Industrial to another zoning category; or c) a Conditional Use Permit which would allow a non-industrial use in an industrial zone; 2) a preliminary review by City staff to determine whether the proposal could result in a significant fiscal or economic impact to the City; 3) in cases where a significant economic or fISCal impact could result, an "economic and ftcal impact analysis. would be prepared by City staff, in consultation with the project applicant, utilizing readily available information and analytical models; 4) this ~n.lvsis would be reviewed by the Economic Development Commission. if requested ~y the applicant or City staff, and would then be forwarded to the Planning COmmISSIOn and City Council for consideration in conjunction with public hearings on the proposal. . It is staffs opinion that this approach would provide the decision makers with relevant information regarding the possible economic and fIScal consequences of these types of proposals, without causing any delay in the processing of such requests, and with a minim.! impact on the project applicant. Ed-.. -Aq-.:l ...).. Page 3, Item _ Meeting Date 6/7/94 FISCAL IMPACT: There would be additional staff costs associated with preparation of economic and fIscal impact reports. If directed to proceed with this draft policy, staff will prepare estimates of these costs for consideration at the time of final adoption of a policy by the City Council. (F:\hom:\pI.:mning\indz.on.3.11) e~-Aq- 3 ATTACHMENT 2 DRAFT INDUSTRIAL ZONING POUCY A. Staff shall provide the City Council with early notification, through. a Council Information Memo, of any proposals which are fIled with the City involving the following: 1. General Plan Amendment from Industrial to another land use category 2. Re-zoning from Industrial to another zoning category 3. a Conditional Use Permit which would allow a non-industrial use in an industrial zone. B. In conjunction with prelimin~ry City staff review of any such proposals, a. prelimin~ry evaluation of the economic and fiscal impacts of the proposal shall be made by Co=unity Development Department, Finance Department, and Planning Department staff, and shall be presented to the City Manager or his designee. Based on this preliminary evaluation, in cases where it is determined by the City Manager or his designee that such a proposal may result in a significant change in the economic impact or fiscal impact to the City, as compared to the current land use designation, an economic and fiscal impact analysis shall be prepared. C. The economic and fIScal impact analysis shall be prepared by City staff, in consultation with the project applicant, using readily available information and analytical models. The analysis shall include the following: 1. evaluation of the job creation potential of the proposed use, (including both quantity and quality of jobs), as compared to the currently allowed uses; 2. evaluation of the fiscal impacts of the proposed use (revenues and costs to the City) as compared to currently allowed uses; 3. evaluation of other economic impact factors, such as impacts of the proposed change on the viability of adjoining and nearby industrial properties (developed or undeveloped); 4. in the case of a proposed land use change in a planned community, the evaluations described above shall address not only the specific property in question, but also the overall planned community. D. At the request of the applicant, or the City Manager or his designee, the economic and fiscal impact analysis shall be forwarded to the Economic Development Commission for review and comment. . E. The report, and any comments submitted by the Economic Development Commission, shall be forwarded to the Planning Commission and City Council for consideration in conjunction with public hearings on the proposal. f~-Aq-4 , F. In cases where the economic impact analysis indicates that a proposal would have an adverse impact on job creation opportunities or other negative impacts on economic development, staff shall provide the Planning Commission and City Council with alternatives which could address these negative impacts. Such alternatives could include: 1. redesignation or rezoning of offsetting acreage to industrial .in another location; 2. changes to the proposed project which would reduce its negative impacts. ~.I-A q.S COUNCIL AGENDA STATEMENT Item 3 Meeting Date 10/09/91 ITEM TITLE: REPORT: AFFOROABlE HOUSING WORKSHOP Community Development Di~r\~ ~ <; . City Manager ~ ~~ (4/5ths Vote: Yes_ No..xJ SUBMITTED BY: REVIEWED BY: BACKGROUND: At the Council meeting of August 5, 1997, Council Members expressed interest in scheduling an affordable housing workshop to discuss the purpose, concepts, issues and resources related to affordable housing. In order to provide Council Members with a better understanding of affordable housing staff will be making a presentation at the workshop which will address the following subtopics. · AFFORDABLE HOUSING DEFINED - Affordable housing in the City of Chula Vista is defined by the Housing Element of the City's General Plan as for sale or for rent dwelling units which are affordable to households whose income levels range 50-80% of the Regional Median Income (low income) and to 80%.120% of the Regional Median Income (moderate income). The current median income for the area is $46,600. As an example, a family of four with an annual income of up to $37,300 (80% of median) would qualify as a low income household. · low INCOME HOUSEHOLDS. EXAMPLE VERY lOW lOW 50% Median 80% Median $23,300 $37,300 ($11.00 per hr.) ($17.00 per hr.) Secretary librarian III Machinist Assistant Planner Auto Mechanic Biologist II Truck Driver Fire Fighter II Tree Trimmer Accountant II lifeguard I Building Inspector I Cashier Senior Buyer Junior Engineer 3// Page 2, Item _ Meeting Date 10/09/97 · WHY WE DO AFFORDABLE HOUSING . Needs - San Diego County is one of the most expensive housing markets in the Country. Majority of households are unable to afford housing costs and the gap between income and housing costs is great. . legal requirements - The City is required by State law to plan for affordable housing for all income segments of the community. It must assess the need for affordable housing, set strategies for the delivering of affordable housing, and measure performances in accomplishing its objectives. · AFFORDABLE HOUSING TOOLS/RESOURCES . HOME . Redevelopment Housing Set Aside . Fair Housing Council of San Diego . Tax Credits . Density Bonus . Rehabilitation loans/grants . Gap financing . Tax Exempt Financing · AFFORDABLE HOUSING PROVIDERS/PLAYERS . Federal . State . City . Private Developer . Non.Profit Housing Developers . Private lenders · AFFORDABLE HOUSING EFFORTS IN CHULA VISTA . Inclusionary Housing Program . Housing Rehabilitation (CHIP) . Mobile Home Program . First.time Homebuyer Program 3~~ Page 3, Item _ Meeting Date 10109/97 . AFFORDABLE HOUSING STRATEGIES/CONCEPTS . Conserve and improve the existing housing stock . Balance jobs with housing opportunities . Assist in the production of new housing . Ensure a range of housing opportunities . Provide and promote housing services . OVERVIEW OF CURRENT PROJECTS AND AVAILABLE FUNDS . Cordova . T rolley Terrace . Eastlake Greens RECOMMENDATION: Following the presentation, it is recommended that Council provide feedback and direction to stafton the current affordable housing effort of the City. l.h/JPAI H:IHOMBCOMMOEV\STAFF.REPI10.9.97Iwork,hop (October 2, 1997 IB:13.mll 3~3