During last week’s budget discussion, City Manager Steve Pinkerton and Mayor Joe Krovoza laid out the bleak fiscal picture facing the city. The question from the audience came almost immediately: given the limits of revenue enhancement and cost-cutting, is growth the only way out of this?
In the short term, the answer is that growth is not going to make much difference either way. The city is primarily going to have to cut spending, they may be able to pass some limited revenue measures, but most of the heavy lifting has to be on the spending side.
Mayor Krovoza did not shy away from the issue, arguing that you have to make sure that the “businesses that you bring in are going to be net positives.” One of the big questions that comes up, he said, is whether the impacts of developing the land are going to be covered.
That said, Mayor Krovoza said, “There is no question, people are driving to West Sacramento and to Woodland and Dixon to do their shopping, then [you’ve] still got your roads and your town and you’re not paying for them, you have retail tax that’s leaving.”
He said that they have been seeing, over the last few years, vacant properties fill up. He noted that the big parcels on the Second Street Corridor have been filling up in recent years, with Mori Seiki being the most prominent of the new tenants. “We’re starting to see that all of those places are going to be gone,” he said.
Following the election of Joe Krovoza and Rochelle Swanson, the Innovation Park Task Force was created to determine where lands around the city that would be available for business development around the city.
“We don’t want to just sprawl out, we want to look at places where the development can match the Davis values,” he said. “Where we might be able to get some level of density… Where it would be as close in to the university as possible, so we can really take advantage of the higher value jobs and more revenue because people will want to be close to campus.”
He said that when that report came out they identified two critical areas. The first is outside of the Mace Curve out by I-80, and the other is north of the city west of the hospital.
“We know unless we find some ways to entitle some lands we’re not going to have the potential to do that,” he said.
What Mayor Krovoza only mentioned in passing is that when the County Board of Supervisors suggested those as two locations to explore for future growth, the city virtually rebelled with hundreds of people streaming to a July 2007 Woodland meeting where the supervisors ended up tabling that discussion.
However, the mayor suggested that when the issue is business development rather than residential growth the reaction might be a little different.
“We have Measure R – Cannery Park can be developed without a Measure R vote, we’re moving forward on the working with the developer there,” he said. “But if it’s Mace or just north of Sutter, it would require a Measure R vote.”
He thinks that things might be different than when the last two Measure R votes that went down to sound defeat in 2005 and 2009.
“We’ve had two Measure R votes,” he said, Covell Village and Wild Horse Ranch. “I was for one and I was opposed to the other… But those were about residential development, so we were going to the public and saying let’s maybe dilute the development of your home, let’s build more homes, and people might have said, ‘well I don’t know about that.’ “
“If we go to the public and say the Measure R is about opening up economic development opportunities,” he said. “I think the vote might be different. I’m not sure about that.”
“I think if the Measure R vote is about revenue and job creation, it might be a very different atmosphere than just asking for more residential development,” he said.
Later, the mayor asked if new retail would simply serve to undermine existing retail.
He said, that there is a concern that a new business comes in and there is a limited market for say, grocery foods, but that at the same time, we have not seen people fall off the bottom as the result of Whole Foods coming into town.
He made the point, “The extent to which our dollars are going to retail out of town, those are dollars that we can hold here.”
“Downtown used to have a real retail (options),” he said. “Now it’s turning into more of an entertainment district – restaurants, movies, and entertainment downtown. That’s concerning.”
City Manager Steve Pinkerton noted the lack of available space in the city, and there are two businesses that may end up leaving town due to the lack of expansion opportunities here in Davis.
“It’s a great deal if you’re a commercial landlord but it’s a pretty bad deal if you’re trying to bring in revenue to the city,” he said. “As much as we’d like to have everything to come into existing buildings in the core, you’ve got to have some additional supply, you’ve got to have the ability to build new modern buildings that these companies have.”
He said that there are businesses coming out the university all of the time that would like to stay in Davis and access the university, but there’s a very limited number of buildings to accommodate them.
“We really are at the edge of a crisis, particularly on free commercial buildings,” he said.
—David M. Greenwald reporting
Get going on Nishi and you’ll have a test of voter sentiment. If that can’t pass a Measure R vote, nothing will.
Mace Curve should be completely off the table.
We’re really going to do this all again? don’t people learn?
“But those were about residential development, so we were going to the public and saying let’s maybe dilute the development of your home, let’s build more homes,”
What a gentle way of saying that home owners want to restrict supply out of self interest. At least he isn’t in denial that supply effects price like some previous members of the council have argued in the past.
With redevelopment gone it is only a matter of time before the pass through dies.
doesn’t mean he’s write – just because he said what you wanted to hear.
right
Maybe someone can tell us how the pass through is being funded. not that it likely matters anymore, the BOS knows better than to mess with growth in davis.
To be clear previous members of the council argued that supply was not relevant to price.
“doesn’t mean he’s write – just because he said what you wanted to hear.”
Of course you must have forgotten all the arguments that have been made against the Cannery being built where opponents argued that it would depress housing values. Of course low housing values are good for those seeking homes and bad for those who bought when prices were high.
you’re citing inaccurate arguments not data
I wonder who it was that asked the question at the forum. I seriously doubt the council wants to tackle peripheral growth right now.
Mr.Toad
[quote]What a gentle way of saying that home owners want to restrict supply out of self interest[/quote]
Perhaps you can explain how a home owner acting in his own interest is any different from a developer who acting in his best interest wants to sell units at as a high a price as possible, or how a new buyer finds it in his best interest to buy the home of his choice at as low a price as possible. Again, I am simply not seeing how one person looking after his own best interest is any more virtuous than another doing the same thing.
Or perhaps I have misinterpreted your previous posts on this issue ?
Medwoman, a developer, depending on the development, is providing a human necessity, improving the community, while making a profit that then cycles through the economy. The homeowner you describe is saying, “I got mine, to hell with everyone else”.
-Michael Bisch
Well said Michael.
I love the way the mayor uses the word dilute as if the community was a corporation and homes were shares. When a corporation issues more stock there is a dilution of the value of the shares since present value of future earnings divided by shares equals the value of each share. The same applies in a sense to the housing stock of a community although your value isn’t based on future earnings it is based on supply and demand so the mayor is applying a term that doesn’t quite fit but then he is trying to be low key and not stir it up too much. A more honest statement would be that Davis is going to try to maintain current values for existing homeowners by restricting growth to what the existing market can absorb without depressing prices too much.
I seriously doubt that most Davisites who oppose growth do so for reason of home value. I think they are more concerned with quality of life issues, maintaining the character of the town, and avoiding the negative aspects of urban sprawl. And it’s worth noting that the question to the mayor, and his response, weren’t related to residential growth.
Michael
[quote]Medwoman, a developer, depending on the development, is providing a human necessity, improving the community, while making a profit that then cycles through the economy. The homeowner you describe is saying, “I got mine, to hell with everyone else”.[/quote]
That is quite a “depending” that you are relying on. The developer is providing a human necessity only if he is providing a type of housing that is truly needed by the community. Some of us do not believe that what Davis needs is more upscale, $400,000 to $600,000 ( as not denied by the developer at the community meeting I attended ) homes in a car dependent poorly situated neighborhood.
As for the private homeowner saying ” I have mine, to hell with everyone else “. Not necessarily. What if the homeowner rents out the home at less than market value ? Could that not be said to be “providing a human necessity” potentially at a relative loss to the home owner in comparison to what they could be bringing in.
I think that often, business people and developers place such a value on economic gain that they cannot conceive that this is not the major motivation of everyone. I actually think that Don has this one just about right for the motives of many who oppose residential growth of the type planned for the Cannery.
Medwoman, the vast majority of Davisites live, work, play, eat, watch movies, shop, or otherwise spend time in a space that a developer created (and hopefully the developer made a profit while creating the space we all are enjoying). Hardly any of us developed these spaces ourselves. Apparently, it was OK for developers to create the spaces that we currently occupy, but it’s not OK for any additional space to be developed for newcomers and new generations to occupy. Seems hypocritical to me. For me, I don’t have an issue with development. I have an issue with location, type, architecture, scale, size, etc.
-Michael Bisch
[quote]Some of us do not believe that what Davis needs is more upscale, $400,000 to $600,000 ( as not denied by the developer at the community meeting I attended ) homes in a car dependent poorly situated neighborhood. [/quote]
So how much is your house worth?
[quote]I have mine, to hell with everyone else [/quote]
More to the point, J.R., what is the EQUITY in the home… I have high equity… some do not… they are the ‘scared’ ones…
[i]So how much is your house worth?
[/i]
I’m more concerned about what my children and employees pay in rent due to an insufficiency of rental housing, and the lack of sufficient proposed rental housing to accommodate the planned increase of 5000 students that UCD is adding.
I’m aligned with Don’s comments above on the reality of the range of reasons and motivations for keeping a lid on development. The current residents desires to preserve the types of quality-of-life intrinsic to a smaller community are at least as legitimate as a potential migrant’s desire to reside in Davis. They are each self-interested desires; the potential migrant’s desires to move here are no less self-interested than the current residents desires to keep the town small! Hopefully most Davisites don’t fall prey to this type of guilt-tripping propaganda; there is a genuine conflict of legitimate interests. Personally I fall on the side of the majority in each community having the power to decide the fate of the community (is this not a conservative sentiment?); and not just handing everything over to the developers (which often happens against the will of the majority of the community).
jimt, all too often there is a disconnect between the intent of the policies that one advocates for and the actual effect. I would argue that many, but not all of the policies that many quality-of-life preservationists have championed, have had the exact opposite effect. Most of the recent growth in the community has been peripheral sprawl. Currently we are experiencing significant growth on the west side of town. We have not captured nearly as much job growth and other economic benefits from UC Davis as we should although I think we are on the cusp of a dramatic change (see Rob Whites VG column). And we have certainly not generated sufficient tax revenue these past 8 or 10 years, because of the policies that we have chosen or not chosen to implement, to preserve our quality-of-life. Indeed, we have been living on borrowed time as David has repeated in column after column and now the chickens have come home to roost.
-Michael Bisch
“Personally I fall on the side of the majority in each community having the power to decide the fate of the community (is this not a conservative sentiment?”
Of course you do Jim. You wouldn’t want the place overrun by “Migrants.”