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HomeMy WebLinkAboutcc min 1997/10/09MINUTES OF A SPECIAL JOINT MEETING/WORKSESSION OF THE CITY COUNCIL AND PLANNING COMMISSION OF THE CITY OF CHULA VISTA Thursday. October 9. 1997 5:40 p.m. Council Conl~rence Room Administration Building CALL TO ORDER 1. ROLL CALL: PRESENT: COUNCILMEMBERS: Moot, Padilia (arrived at 5:50 p.m.), Rindone (arrived at 5:41 p.m.). Salas. and Mayor Horton. COMMISSIONERS: Aguilar, Ray, Tarantino, Thomas. Willett, and Chair Davis. ABSENT: COMMISSIONER: O'Neill ALSO PRESENT: City Manager. John D. Goss; City Attorney. John M. Kaheny; and City Clerk. Be,,'erly A. Authelet BUSINESS 2. REPORT LACK OF ADEQUATE INDUSTRIAL ZONED LAND IN CHULA VISTA - San Diego County has 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 the Bayfront, Southwest and Otay Valley Road Redevelopment Project Areas. The cnrrent 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 flirther limit the City's ability to respond to ongoing and fixture business demands. Staff recommends that Council and the Platruing Commission review the infm'mation and provide direction to staff. (Community Development Director) Cheryl Dye, Economic Devdopment Manager, summarized the "Issue Paper". She stated that during the last lour to six years, there has been very little industrial activity as a result of the recession; bnt this is changing. For example, region-wide in 1992 there was only five acres c~f industrial property sold in the County. In 1996, that rose to 800 acres. In the first seven months of 1997, 700 acres have sold. County-wide the delnand IBr indnstrial property has retnrned. Concurrently with that demand, what the region is seeing is that there has been a diminishing of available industrial property. What we are seeing in Chula Vista is the same kind of issue. We haven't had industrial activity IBr the last several years, and then all of sudden that is turning around. Our problem is that we are having difficulty in meeting the demand. Ms. Dye presented a listing of available industrial land in the City: Total Planned % of Master Plan Acreage Industrial Acres Total EastLake 3.075 200 6.5 Otay Ranch (Baldwin) 8, I00 232 2.8 Otay Ranch (McMillin) 1,000 0 0 Rancho del Rey 1.600 29 1.8 Rancho San Miguel 2,590 0 0 Rolling Hills (Salt Creek/La Cuesta) 915 0 0 Sunbow lI 1,300 Totals 18,580 484 2.6 Minutes October 9, 1997 Page 2 After the staff report was presented. the ti/Ih}wing questions and concerns were addressed by the fbllowing individuals: · Russ Hall, Economic Development Commissioner, stated he endorsed the staff report and thought it was very thorough and lln target abnut the challenges heftire ns. In coastal metropolitan Southern California, we all face a declining resource m land, but we are now seeing an increased need liar that resource. The first question we are asked is what is the City's inventory of land and t~lcilities. It is key that we have property for businesses, because cllmpanies are not only going to h/ok at the short term, they are going to look at long-term growth opportunities to stay in the commnnity. This is especially trne with the incubator companies: it is not going to make a lot of sense t,1 continu~ these types of prl}grams it we can't keep tile companies. He urged Council to do whatever was necessary within the appropriate bonndaries of the City's laws, codes, general plans, etc. to continue to move ~>rward to make as ranch property as possible available fi}r economic development purposes. Once we get to that point, and we have a good land use planning policy tier economic development, then ecunomic development profbssionals can begin to target those industries and go after them. · William Tuchscher. Ecnnnmic Development Commissioner, stated that San Diego County acts like an island bordered by Mexico to the sonth, mlumtains to the east, Camp Pendleton to the north, and the ocean to the west. Development opportunities are furthel elmstrained by hillside ordinances, extreme slope, drainage concems, and habitat. San Diego is among the top fimr cities in five categories which are: micro-electronics, telecommunications, robotics, biomedical, and biotech that are the fitstest growing segments of the U.S. economy. Industrial land in our city ~s a misnomer; we really have nil "industrial land". The only truly industrial, smoke-stack zoning in our city is the SDG&E site fin the Bayfront. We have light industrial which is a very clean industry consisting of: distribution, assembly. light manufacturing. and research and development uses. In the '90s, we had an extremely bad economy, slow business expansilm, and dismal indnstrial growth and absorption of land. At the same time, we had a rise in big box retailing such as Walmart, K-Mart, Price/Costco, and Home Depot. We went through a phase of "zoning tk}r dollars". An example, is the Rancho del Rey Business Center, which at the time we had high unemployment, so that prpject created a lot of jobs and new sources of general fired revenue. We now need to rethink those tenses. Creation of jobs is critical to our future, and it is very important that we enhance the quality of life fbr our citizens which includes reducing traffic and allowing parents to live closer to their t~milies. The city has made great strides in its marketing efforts. We now have companies coming to us first, and we are competitive with other states. We need to maintain a supply of inventory of industrial land l'~3r the fnture. Councihnember Rindone stated it was his understanding that t~es tZ~r the development of industrial land in Chula Vista was five times that nf San Diego and two times that of Carlsbad, so how are we competitive. Mr. Tuchscher replied that we are competitive because we have done a good job of marketing ourselves. The reality of delivering both competitively priced land, iilst processing times, and incentive packages is something that we need to get better at. Councilmember Salas stated that we can say that there is going to be a demand tier industrial land, but we are also going to have the pressures of the developers who are saying that their land is laying ti~llow. We are going to be pressured one way or the other, so we need to know what we gave up in the exchange of rezoning of the Rancho del Rey Business Center and whether it benefitted us in the long run. Mr. Tuchscher replied that he could only comment on his vote Ibr the change of use when he was a planning commissioner. There were a number of economic lhctors snch as: the city's general ti~nd; the RTC had taken over Home Federal and had stopped Rancho del Rey. There was not a demand liar the industrial land at that time. There~i~re, McMillin was allowed to sell a ma:jor parcel. He l~lt it was a right decision since it was a project that would generate about 1200jobs. He did not t~el it was the right time now to he looking at rezoning that land. He t~lt a decision of whether we want to be a bedroom community or be a vibrant community which creates ,jobs must he made. · Ty Compton, Economic Development Commissioner, expressed that EastLake Phase II was a long-term project. He I~lt that we should get away Ii-om the nld paradigm that smoke stack is industrial; it is not. There are Minutes October 9, 1997 Page 3 several companies who have gnne through the R&D process and are now getting rote the tnanutitcturing end of pharmaceuticals. He It:It that pharmaceutical manufacturing was cleaner than most of our honles because everything is under sterile conditions. He t~lt Clmncil should start to cl~nsider this type of business and make a zone lbr it. Chula Vista can't be a bedroom comnmnity. You can build all the houses m the world, but they can't support themselves. You have to have outside tax dollars. and those tax dollars comes from other sources other than homeowners. If the people who live here want city services, we are going to have to look at this and say that we need these businesses, and we have to compete with other states. He I~lt it was tinge ibr the Cimncil and Planning Commission take a look at the ztming process and make Chula Vista the greatest town that it is. · Rod Davis, Chamber of Commerce, expressed that BECCA was our best and brightest hope, because it was here now. It is attracting compauies, it is graduating companies, it is devchlping comicantes that have a loyahy to the City because we gave them a hand, a place, and some cash to take an idea and turn ~t into reality. When they graduate, they are going to stay here. Regarding competition, he stated he has worked with three companies and all three have gone to Otay Mesa because it was cheaper. We have a comnmnity that people want to live in because of the excellent job that has been done in making it attractive. If Council is seritms about attracting industry, then Council must fix the fidlowmg: (1) The City nmst become competitive on cost. It tnust be as reasonable to come here. (2) The attitude by staff at the public counters nlusl change. We are not business friendly in Chula Vista; we are business neutral at best. If you can get to the department heads, you can solve virtually any problem. He suggested that if Council wanted to do something really good and innovative, then take the commercial space that has out lived its retail usefijlness, (i.e. the cl~rridors along the north end t~t' Broadway and the north end el "H" Street, tear down some of the buildings that are close to the freeway and make industrial land out of it. · Bennett Greenwald stated that we needed "Performance Standard Zoning". It is not a question of holding indttstrial land and having people come to you. it will not happen. Not when ylm have 7,000 acres of competitive. cheaper land with inti'astructure in place to the south of you. There are very specific ways that you can become competitive. You have to be competitive in terms of processing, in terms tff t~es. and thee you have to hlok at what wins and losses you get when you make these decisions to bring in certain types of businesses. CEOs or the people who make the decisions consider things such as i{ib location, costs of housing, the labor base. travel time to work. and schools. They c,3nsider the gcl~nomics, the heallh ill their workers, and tile health of their companies. In order to be competitive, we have to bring to the table an awtid hit of things that we do not have available right now. You can put a label Im the land and preserve the land. but ira company can find it ch~-aper elsewhere. that is where they will go. · Jim Moxham, 900 Lane Avenue. Chula Vista, 91914, representing the EastLake Co., and responsible their commercial industrial operations. He stated the issue of industrial land absorption was one that is being studied throughout San Diego County to determine whether or not there is a pending problem. The views range fi-om a crisis to no issue at all. He did not believe all the thcts were adequately represented in the staff's report. For example, Grubb & Ellis' second quarter report states that this year, Chula Vista/National City lost 300,000 square feet of tenants; the vacancy rate went up to 12%. There are over 1.2 millilln square f~et of empty industrial buildings in this trade area, Also missing from the report was the historical land absorption. He did not mean how much has been taken out of industrial use and moved to commercial, but how nmch has been absorbed historically by industrial users. We need that infi~rmation to assess what the city's fnmre demands are going to be. In San Diego County, 800 acres were sold last year. This year so fitr 700 acres have been sold. In Chula Vista only 7 acres have been sold in the last twenty months. This is not a strong industrial market. The question that Council should ask is why didn't a more significant portion of the 1500 acres of industrial land that has been absorbed in San Diego County in the last t;venty months come to Chula Vista. He feh that the most recent BIA fee survey study indicating that Chnla Vista's fees were the highest tkes in the County was a significant thctor. In summary, he t~lt the report was incomplete, because it didn't deal with the historical abs{u-ption in the industrial land by industrial users. The demand in Chula Vista ~s very low, not reflective of the demand that is being experienced elsewhere in the County. Lastly, the f~es are a big contributive thclor. Connnissioner Aguilar stated that there was a company who wanted to locate in North County because they l~lt that was where their employees wanted to live. She asked if this had anything to do with the ihilurc of Chula Vista be able to take advantage of some of the industrial land that has beeu absorbed, or does it have to do with t~es. or Minutes Ottoher 9, 1997 Page 4 is it slimething t.,i do with the image ,,if the South Bay. Mr. Moxham i~lt that the answer was both. We are at a disadvantage to Sierra Mesa, Poway, and Carlsbad. For those reasons. we need to be more aggressive on our tbes to try to level the playing field. We talk about Otay Mesa which is a huge colnpetition. Nobody questions that being in EastLake is nicer, but it is not necessarily worth $4 tll $5 more. Businesses are econonlically driven. You talk about where these companies want to locate. They locate where the CEO wants to live. They want to h~cate near where his elmrotate is the shortest. Yes. image was definitely a concern. Cimncihnember Salas t~lt that there is really a change of filcus and a h~t of that has to do with our proximity to the border. Its going to be very lucrative tbr clm~panies to come and locate close to where they need to supply. He was right that executives want the companies near where they live. We are seeing more and more Japanese ~xecutives fi'om big Japanese companies living in EastLake and expressing the desire fbr their con:panics to be there. When she worked tbr California Trade and Commerce, Chula Vista was not competitive. The reason was not so much the t~e stnlcture, but that we did not have those large parcels of land. Mayor Horton, looking at the t~e schedule, stated that the categ,.~ry which appears to he the most o'at-of~sync was traffic. She asked why was that'? Mr. Goss replied that Cimncil has had a policy that growth should pay I~r itself. We have development impact fees tbr traffic and fi>r public lhcilities. If you look at the comparisons between Carlsbad and Chula Vista. you notice that our sewer t~e is hlwer. The public ihcility rate is lower which would he lmr public lhcilities DIF. Our traffic is higher. What is happening is that we arc bnilding in new areas, and there is a traffic impact fee that has to be paid to build the streets so the existing tax payers don't pay tbr that growth. Mayor Horton wanted to know how the other cities provide the infi-astructure without placing a f~e burden on the existing residents. She t~lt that htlth the City Council and the Planning Connnission would like a response back regarding this. She also ,,vanted to know why Chula Vista used a different evalnation year. Mr. Goss stated that the staff that had been involved in this was George Krempl. John Lippitt. and Marty Chase are not here. We don't have the staff expertise here to answer some of the questions. · Paul Niero, 900 Lane Avenue. Chula Vista 91914. representing EastLake Co. stated that the reasons why industrial parks exist where they do are: ( l ) first is the proximity t,.~ transportation; and (2) proximity to some kind of a generator of activity. We do not have a shortage of land in Chula Vista. Purely fi-om an industrial zoned land perspective, if you look at the m:~jor master plans in Chula Vista. several of them have zero industrial land. a disproportionate amount is set aside in EastLake. Council sh,:luld think h,3w do we systematically deliver industrial supply and satisiS, the need of those industrial users. keeping in mind access to fi-eeways, potential access to toll ways, and proxinlity to key generators of activity. They lost one company because they did not have a road going thrtmgh EastLake. Council needs to take a hmg-term approach to how these developments are going to be phased in with regards to the road infi-astructure, their tie-ins to 805, p,3tentially to 905. SR-125, and think about how that is going to solve problems tbr the industrial users. He uses the word "industrial" in a very broad sense: the high tech, biotech, those kinds of users. He flirther stated that EastLake has never proposed reducing its industrial acres: they wanted to reconfigure it. They missed it, because it was the highest point in EastLake topographically. A very difficult location to develop and tnrn into industriah They will have to move about an acre of land to create an acre of usable land. EastLake is proposing to consider working around the topographicaI area by swapping it with land that was originally contemplated to be residential ad. iaccnt to SR-125. For some short-term sohtfions, the Kaiser parcel which is a 30 acre parcel ac~iacent to the EastLake Business Center is currently zoned fbr a hospital. He did not see a problem in making this a part lifthe broader commercial zoned designation. It wonld be a good land use. There are other go{>d land uses hlr it too in terms of being ultimately close to their entertainanent center and shopping center area. II the concern is tile good job opportunities and a big parcel, that is certainly one that is ready to go today. Rod Davis stated that ,,v¢ have not talked about why we are not expanding and why we are losing industrial Minutes October 9, 1997 Page 5 businesses. We are losing companies because of the policy on uff site improvements. They had a gentleman who runs a sheet metal fabrication company off Main Street who wanted to do a $25,000 expansion to his building and his off-site improvements would have been $100,000. He left the City. There was another company who was ready to leave because when he was in the County wher~ he could have an 8 lbot lbncc, and he never had a car stolen out of his parking lot. Now he is in the City, he had to replace the 8 fi>ot lbnce with a 6 fi~<lt lbnce: he now has a car stolen every week. He wanted to make the building h}l}k better, and he had 12 square lbet of dirt which he wanted landscaped. He took his plan to the City and was told it couldn't be hloked at until it had been done by a landscape architect. He paid a landscape architect $275 to put his stamp on it, and then th~ City approved it. Same plan, not one change, and it cost him $275. He also paid $1500 per year fi~r inspection of his anti-syphon devices, because he was an industriaI titcility. He did not want to lust sight of the expansion and retention aspect when we are talking about industrial, because we aren't doing that real well either. Ms. Dye stated that part of what staff is saying to C,3uncil is that if we are targeting certain industries such as biotech and we can't deliver a site, then why are we marketing to that indnstry. We need to reevaluate if that is the industry we want to target. She then went over the rc, comnlendatilms as fi>lhlws: Short-term recommendations that Council: Affirm the City's desire to preserve the High Tech/Biotech Zone hy maintaining an industrial land use designation in both Phases I and II of the EastLake Business Center: Direct staff to study the f~asihility of crating industrial overlay zones and/or amending the existing zoning ordinance to allow liar limited light industrial uses within certain commercial areas throughuut the City: and Direct staff to analyze the impact of proposed indnstrial land use conversmns utilizing the li~ur-step process described in the staff report. 1. That Council direct staff' to prepare a report which addresses: a. the need to preser,~'e existing industrial stock via an adopted p,.llicy; and b. the potential of redesignating areas of the City to industrial land use. That Council provide stall with their vision as it related to the ~lture role ,31 indnstrial development within the Bayfront, Otay Valley Road, and Southwest areas in order t{i help staff taller ongoing and filture economic development promotion activities. Councilmember Salas stated that Mr. Neiro lr,.im EastLake made stnne valid points ah{int the Phase II and the ability to swap it closer to SR-125. She asked Ms. Dye what her f~'elings were as tl> what dcl to with a high tech/biotech zone designation if we dc~n't have any high tech/biotech yet. Ms. Dye responded that it com~s hack to the/hot that we don't have a site large enllugh tier th~zm. There are things which we need to look at and bring Planning and Engineering into the process. W~ ~et back to the short-term versus the long-term. We have been trying to position ourselves to respond ttl a need, and now that the need is emerging, we want tu be carerid that we don~t say we can't meet it. Councilmember Moot stated that it was very hard tl~ assimilate ~verything they heard, and then make a decision on the spot. He wuuld like to see the minutes of this hearing: he would like to see this topic agendized on the city council or planning calendars with s,3me very specific recommendations and additional information. This issue of large versus small lots is really one that needs to be sorted lint with statistics and data. This issue of immediate versus Iong-ternl is very important. If our trustration is that we dtm't have a 30 acre site tu show, it seems that Minntes October 9. 1997 Page 6 it is a short-term problem that is solvable. so we can plan tbr an existing site that is deliverable quickly that we can show people. We need more in~rmation on the issne of f~es and the expense of the fees. If we are going to deliver the existing sites that we have, we need to bave a specific strategy on how to do that which seems to be centered around tees, e~ther Perfilrmance Standard Zoning ur an attitnde change. He I~lt to make thuse decisions tonight with all the data given was vay diflicult to assm~ilate it all and make a concrete decision. Mayor Horton stated she would like to look at a recommendation that was made in regard to our comlnercial/industrial zone and how we could make it more flexible so that the zone would encompass more different uses without having to go throngh the special use process, Councihnember Rindone suggested that the Council return this back to staff to Ii~ok at the multiple issues and bring it back. Then Connell can roll up their sleeves and ll~ok at these issues. The staff report was predominately in only portion of those ma:jor issues. We have to revitalize the ecumnBic health of Chnla Vista~ because we have the available resources, the raw land. He did nl~t want to put a time limit on this, but to do it as soon as staff can, but he wanted a thorough analysis ill the areas mentil~nrd, Commissioner Aguilar stated that it appeared that the lblluwing issues ueeded to be addressed: (1) availability of land: (2) the issue of l~es and our fee structure; (3) the area ill image (North Clmnty is where people want to live because it is the "sexy, trendy, in place" to live right now. If it is true that CEOs are the ones who make these final siting decisions. then this is a m~jor issue which needs to be addressed): (4) issne of distribution of the industrial land (if fi-eeway access is important, then we need to think abont having land that is close to one of the existing freeways or to SR-125 in the future); and (5) the issue about the public counter service (if the word industrial comes ont, develupers should not be told "no" ). John Willett suggested using a tiermat {if' an EIR to bring lint all {if the elements that we heard tonight. One of the concerns he had is when you are asking a deeclipper t{l hl~ld land ~r industrial development for a period of 5.6, 7 years. how do they get reimbursed lilt the money that they had in that and then tu change it over to honsing. He concurred that the redevelopment a.~ency has dime and excellent report. hut we need to come back and identit3~ some more of the elements. He supported that no action be taken tlmight. 3. REPORT THE CITY OF CHULA VISTA AFFORDABLE HOUSING PROGRAM - The porpose ol this report is to update the City Council on the current stares of afb3rdable housing in Chula Vista. to indicate the progress that has been made. and evaluate the current effilrts, resonrces and strategies that are available to address continuing needs. Staff reconnnends that Council review the inti~rlnation and provide direction to staff. (Community Development Director) Because of the lateness of the hour, the item was continued to a later date. ORAL COMMUNICATIONS Theru were none. OTHER BUSINESS 4. CITY MANAGER'S REPORT(S) Mr. Goss stated that his role as city manager has been to try to express a vision. He wanted to plant the seed for the Council not overlook the potential of the East Mesa. The Cimnty has this area designated as industrial. Now that we have annexed the Otay Ranch~ we have a co-terminus boundary with that area. It is located east of San Diego's industrial land on Otay Mesa. There is quite a bit of industrial land there that will not develop until the r~st of the Mesa is developed. This is long-term. but if Chola Vista is going to maintain its economic viability, it Minutes October 9, 1997 Page 7 needs a long-term vision as well. There are two m:~jor obstacles even though it is co-terminus to Chula Vista: the County of San Diego and the City of San Diego. Today neither the County nor the City of San Diego would support this, but it would be something fi~r the Chula Vista to work on. He did not t~el that Chula Vista should stand by and let the County or City of San Diego take it over. 5. MAYOR'S/CHAIR'S REPORT(S) - None 6. COUNCIL/COMMISSIONER'S COMMENTS - None The meeting a~journed at 8:22 p.m. ADJOURNMENT Respect~llly submitted, lthelet, CMC/AAE City Clerk