by Rob White
Those that stayed at the Davis City Council meeting until the very end or watched on TV from home, you are already aware that the City Council has decided to reconvene the Innovation Park Task Force. Council member Rochelle Swanson made the request, which was in turn supported by the Council.
This comes at a time when efforts to retain growing technology companies has been a mixed bag of bittersweet farewell and successful retention. We heard in late July that Bayer CropScience had announced that it would relocate its two divisions in early 2014, growing from the current 130+ to as many as 300 employees and increasing their facilities from an aggregate of about 60,000 square feet to well over 160,000 square feet on 10 acres, with an additional 10 acres for grow fields.
Then just last week, Marrone Bio Innovations announced that it would be staying in Davis after its successful Initial Public Offering (IPO) and would be taking over the Bayer CropScience space in mid-2014, after Bayer has moved. I toured the Marrone space on Tuesday, and I was both impressed by the sheer magnitude of the operation and puzzled by how they had crammed so many workspaces, grow rooms, and specialty labs into such a small space. I can only imagine how nice it will be to get to the new facility in about 10 months and spread out a little. But it was also obvious that their continued success will mean that they will be out of room soon enough.
You may also remember that my article from early August discussed that the City has been informed by more technology companies in Davis that they are experiencing similar growth and making plans for expansion. As I stated then, the good news is that they have reached out and are asking to meet with the City staff. The bad news is that at least one has already decided to leave and several of the others are struggling to see facility options in Davis as a viable alternative. As indicated before, requested confidentiality means I won’t enumerate who these companies are, but you can probably make at least a few educated guesses. And these names have been shared with leadership at the City and there is a concerted effort to do what we can to retain these companies.
It goes without saying that these technology companies and the jobs they represent are important to Davis. More important is to recognize what they contribute to the local economy. Unlike a small startup or business, medium sized companies that are on a growth trajectory become active in the local community activities and organizations. Some of these companies have done more than give their time and have been significant local philanthropist.
To refresh, the City Council created the Innovation Park Task Force back in October 2010. The members included representatives from the Planning Commission, Business and Economic Development Commission, Mayor Joe Krovoza, and Council Member (then Mayor Pro Tem) Rochelle Swanson. They worked diligently on the following:
- Conducting business outreach and public discussion regarding community benefits and impacts of a peripheral business park;
- Evaluate peripheral opportunity sites, focusing on, Mace Ranch/I-80 and the Northwest quadrant as initial site options;
- Identify attributes of world-class next-generation university-related business park and how they would apply to a future business park in Davis;
- Return to City Council with summary of findings and recommendation on future peripheral business park.
You might also remember that on November 13, 2012, the Task Force returned to the City Council with a report out and made several recommendations (http://city-council.cityofdavis.org/Media/Default/Documents/PDF/CityCouncil/CouncilMeetings/Agendas/20121113/Packet/06-Innovation-Park-Task-Force-amended.pdf). These were ultimately adopted by resolution of the City Council and specifically included the following language:
Pursue a “Dispersed Innovation Strategy” offering flexible space (scalability) supporting needs of growing and new businesses. A combined approach of near term close-in hub with mid-term, larger less constrained edge sites offer the best mix of University proximity and expansion capability for the City:
1) Maximize Existing Inventory to increase development certainty, and flexibility.
2) Review existing land use, zoning and tax structure with objectives of supporting retention and growth of innovation businesses and maximizing revenue opportunities.
3) Near Term – The Gateway (Downtown Research & University Innovation District) option offers the best close/in location due to the proximity to University and property owner and University interest, and should be pursued as the City’s top innovation center priority.
4) Mid-Term – The East and West “edge” sites offer viable options for location and size of larger innovation centers meeting needs of growing mid-sized companies, and should be continued to be explored as part of a mid-term Dispersed Innovation Strategy.
I discussed in the article in early August that staff continues to meet on a regular basis with community organizations, companies, brokers, land owners, developers, etc. to address Items #1 and #2. This is an ongoing process and will continue to be a priority regardless of outcomes from later recommendations.
For Item #3, the city, land owners, county and university staff continue to meet regularly on ways to implement this item as an important element to the Davis strategy. The Gateway/ Downtown Research & University Innovation District (of which the Nishi property is a part) continues to be a strong focus for the community in trying to address as many of the needs as viable. The university is on track for its efforts on major facility planning in that area and the rest of the parties are working diligently to be in step with that effort.
But Item #3 does not address the overall needs of the community if we plan to retain these growing companies that need parcels that range from 5 to 20 acres, and in one case 40 acres. It does address the opportunity for a near-campus research cluster that can accommodate startups and small companies, but once these companies are reaching sizes of 75+, that space will be too limited, as evidenced by the Marrone Bio Innovations example.
That leaves us with Item #4 as a discussion point. And that is what the Innovation Park Task Force will be convened to start re-discussing. The opportunity for the quickly growing companies that are in need of larger facilities is likely to be one that will also require substantial community dialogue to determine an answer.
Item #4 specifically focused on two specific areas: the Mace Curve properties and the Northwest Quadrant properties. Since then (the recommendations are approaching a year old), at least one additional option has been proposed, though it has not been fully vetted to my knowledge. That option is the redevelopment of the existing technology facilities in the South Davis area. That would possibly include reconditioning, densification in underutilized areas, and possibly wholesale demolition and increased building heights. As an example, one might think of areas of Berkeley where this has happened.
The staff report from November 2012 also included suggested direction on the next steps, including holding community meetings and creating engagement opportunities. With these directions in mind, staff will reconvene the original members of the Task Force and ask that group to determine any additional partners that may be immediately material to the effort. We will then work on completing an internal draft Action Plan from the November 2012 Council resolution. The draft will be initially shared with several of our community organizations and then taken to Council later this Fall for discussion and direction.
Once the Action Plan is affirmed by the City Council, the Task Force will work this Fall and Winter with community groups to bring the recommendations forward and gather ideas for implementation. Several community workshops are planned to be part of the Action Plan activities.
This coming Spring, once the Task Force has gathered ideas for implementation on the Action Plan, we will synthesize that information and go back to Council for discussion and then potentially adoption of a set of distinct opportunities to implement.
This effort comes at a time when several other groups are working on their efforts in this same space. The Nishi/ Gateway-Downtown Research & University Innovation District group are diligently discussing how to move forward. And a few days ago, another community group suggested a proposal here on the Vanguard for an innovation park in the Mace Curve area.
I am hopeful and excited for the increased dialogue that the Innovation Park Task Force will bring to the concern about retaining growing technology companies. And though I do not know what the result will be from these efforts and discussions, I look forward to the community engaging, reviewing best practices from similar communities, assessing realistic financial conditions that inform expectations, reaching out to leadership of successful innovation parks, and determining in what ways the whole community may be able to leverage the opportunities to address current revenue shortfalls so that we can create a sustainable funding for our cherished quality of life.
One activity that I think the Task Force would find helpful and that the Vanguard community might be helpful in engaging is to identify current examples of innovation parks around the nation or even globally that might be realistic analogues to an innovation park that you could imagine in Davis. Some suggestions that have already been given to me include San Francisco’s Mission Bay (home to QB3), San Diego’s La Jolla Mesa (home to San Diego CONNECT), Research Triangle Park-North Carolina, Sandia National Labs’ Albuquerque Technology Park, Alexandria’s King Street Business Center/Eisenhower US Patent Office Park, and New Orleans’ Idea Village.
If you have suggestions of other Innovation parks that you have seen on your travels that you think would be an asset to the Davis community and enhance our efforts to retain and grow (and someday attract) technology businesses, please let me know.
As always, please let me know your thoughts. My email is rwhite@cityofdavis.org.
Rob
I need help in understanding a basic underlying precept of this conversation. It seems to me that you are stating that we need to create a situation in which small start ups from the university will be able to remain in our community as they grow. And, the university will be an unending source of small start ups , or at least we hope it will. And yet, Davis does not have an unending supply of land available. So it seems to me that we may be focusing our efforts on building an untenable situation. If one of the critical functions of the university is to create small start ups, and we build so as to favor their retention in the community, will we not be creating a situation eventually in which the new start ups have no physical space in which to locate ? If your response is that they will move into those spaces occupied by businesses that have grown larger and moved on, how is that different from what we have now, only larger ? So again, my basic question, how much growth would you see as optimal ? What is your end point, and why ?
“Unlike a small startup or business, medium sized companies that are on a growth trajectory become active in the local community activities and organizations.”
I agree with much of what Rob writes, but this oft repeated claim does not pass the smell test. I have no statistics to support my contention, but I’m pretty sure small businesses are far more active in the community than mid-sized, techy businesses, contributing more money as a percentage of revenue and/or balance sheet, and certainly more time. Look at the Rotarians, the Odd Fellows, the Chamber, Davis Downtown, the dentists sponsoring little league teams, restaurants donating to PTA fundraisers, etc. Small businesses are extremely engaged in their communities on many, many levels.
-Michael Bisch
Don’t forget that Sacramento falls within UC Davis’ official “region,” so in that sense there is nothing lost when a Davis-based firm moves to Sacramento. More generally, though, the real economic issue is not how many firms move in or out of Davis, but rather to what extent UC Davis is contributing to economic and social gains across the board.
As they say, a rising tide lifts all boats. What sense does it really make in trying to prevent companies from moving to Sacramento if that company would be more productive there instead of here? Davis is a university town. That’s our niche. If we turn into a haven for tech companies and start changing the master city plan to go in that direction, then that could impinge upon our niche area in which we excel. Do we want to turn into a mini-metropolis with escalating apartment rent levels, etc? I don’t think so.
Seems to me that we should only be worried about “keeping” firms that are engaged in close collaboration with professors and labs at UC Davis.
“Don’t forget that Sacramento falls within UC Davis’ official “region,” so in that sense there is nothing lost when a Davis-based firm moves to Sacramento”
I assume you mean that from UCD’s perspective that there’s nothing lost.
[quote]Marrone Bio Innovations announced that it would be staying in Davis after its successful Initial Public Offering (IPO) and would be taking over the Bayer CropScience space in mid-2014, after Bayer has moved.[/quote]
I missed that! Great news.
[quote]Don’t forget that Sacramento falls within UC Davis’ official “region,” so in that sense there is nothing lost when a Davis-based firm moves to Sacramento. More generally, though, the real economic issue is not how many firms move in or out of Davis, but rather to what extent UC Davis is contributing to economic and social gains across the board. [/quote]
I agree with this statement by Brian. We’re part of a region, not competing with other cities. If a firm moves out of a space, another is likely to move in.
Having the Innovation Task Force reconvene could help move discussions forward about some of the other sites in town, especially those mentioned in their near-term goals in their final report.
Sorry – the regional “we are all in this together” argument is clearly disingenuous because it emanates from the same people that routinely and firmly put themselves in the ultra slow growth and no growth camp.
If we were “all in this together”, Davis would build more housing and be open to more economic development to support the needs of the region. What these folks are really saying here… and it is a disturbing Davis tendency… you other regions grow and sprawl so Davis does not have to change.
But then freeway traffic increases. And more carbon is released into the air. And people cannot ride a bike to work.
And Davis has nothing close to what constitutes modern, environmentally-correct SMART planning and development.
Here are the facts:
– The people that make this regional argument generally don’t really care about regional impacts or benefits, they just want to “dump” the change they don’t like on others.
– Prime farmland is prime farmland. If we deny a development using the “save farmland” canard, and another community uses farmland to develop a new business property, then we have not done a thing in preserving farmland. All we have done is reject the local tax revenue that would have derived from that business in order to appease the Davis change-averse.
– By standard measures, Davis is short about 3000 jobs at this point just to support our own population. It is OUR responsibility to work toward growing the number of jobs to reduce that gap, not some other community. We need start carrying our own water.
My final point is to address the need for Davis residents to fully support the university’s ongoing success. And, having a larger supply of ag/tech businesses that increases the supply of student intern positions and graduate job opportunities would serve to increase the REAL value of a UCD education. Standford for example derives tremendous additional education service value from the large supply of businesses within their community (double the number per capita compared to business-hostile Davis).
Having these businesses located in Sacramento instead of the same community where the school exists greatly diminishes the value.
Medwoman – great questions, and as you can expect, they are riddled with complexities. I can’t state that I have the absolute answer to your questions, and I will be quick to take the easy way out to say “the actual decisions are in the hands of the policymakers and the community”. As you know, I continue to state that my role here in Davis is to inform through experience and data and then implement the decisions of the Council.
But, speaking only from my own experience, I would liken the situation to that of a biological ecosystem… An ecosystem in balance has a variety of inputs and outputs and grows to fill its environment and remain at a stable state until something changes that dynamic. If any one of the inputs increases or decreases without an equal reaction in the environment, then the whole ecosystem starts to suffer… possibly even eroding to a point that it cannot recover.
So, yes, we do want to encourage the small startups and businesses to be healthy and collect around the university’s main thrust areas (primarily Ag, Biotech, Medtech, Manufacturing, Engineering and Vet Science at the present time). We want the university to be good partners in the ecosystem to create ample diversity of opportunities, including employment and investment.
It’s pretty easy to also see that we need complete systems to ensure that these small startups and businesses find healthy environments to succeed in, including professional services, investment, mentors, researchers, cheap labor/students, effective supply chains, etc. As critical mass builds, these startups need places to move up (or out) to.
But we also know that as the ecosystem becomes more sophisticated, the need for higher “quality” inputs grows… so as the university becomes more prominent, we need to attract better faculty, students, staff, etc. And in the ecosystem analogy, these inputs then create new needs for more “nutrients” like a thriving downtown, bike paths, parks, entertainment, etc. Which requires more investment, which in turn requires more space to attract the investment, which… well, you get the point.
This of course is what leads to the “evolution of more complex organism”, or medium and larger businesses. The complexities in the environment dictate that we need their expertise, their abilities, their draw to attract those faculty, students, etc. We need relationships and networks and we are most in need of investment to keep the university moving up the ladder… including grants, contracts, facilities, and endowments.
I would also premise that we have at least two significant drivers in our ecosystem that are out of balance and need to be addressed.
1. Due to a growing university in prominence and size, we need to attract the best faculty, students, administration, investment, endowments, grants, etc. in order to maintain that notoriety. If not, then the programs start to go other places, the federal grant monies start to dry up, the faculty are not world-class, and the students no longer enroll in droves. To be simplistic, the university is either growing or dying, but it really can’t remain static in the current academic world.
2. We have an obvious revenue problem due to these ecosystem changes. Both at the university and the city. We worked to attract the best talent, which in turn increased costs of the needed inputs. We built better parks and bike paths and attracted/retained talented people which in turn drove up costs. And though we now see the “day after” a little more clearly, it is difficult to remove these amenities from the public use or remove talent that is needed to maintain that level of quality of life. And we can continue to maintain or increase taxes, but that starts to turn quickly to a conversation of equity, social justice and “killing off the golden goose”.
Let me be clear, I am not suggesting the solution is rampant growth and runaway development. What I am suggesting is that some of the community leaders and some of our very bright people can sit down and have a dialogue about the realities of our situation and try to come up with a best fit scenario. Because these things are all related and like an ecosystem, if you change one parameter too severely, the system has to correct for that change or risk permanent damage.
We overspent and overcommitted in the good times. Not on purpose and not with malice. But it is done now and though we can retrench some, it does not completely fix the balance. We need to add more nutrients to the ecosystem to get back in balance, and it is efforts like the Innovation Park Task Force that will try to address that end of the equation.
I hope that gives a perspective on what I see from my vantage point, and it in no way is reflective of everything across the spectrum.
Michael – great point. I did over-generalize. We have very active and involved small and medium businesses in Davis and they should be credited for their community involvement.
I guess my view was a bit skewed by recent experience in Livermore where it was the medium and larger businesses that had taken on the role of significant philanthropy and community involvement. And if we don’t have that level of involvement from these businesses locally, we should ask ourselves “why not?” and “how do we change that?”. Is it because we don’t have a significant amount of these business sizes (“medium” = over 50 employees and “large” = over 100 employees) and therefore we don’t see as much corporate involvement?
To use Livermore as an example, the largest employer there was the national labs (about 8,000 total, plus contractors) but there were also very large viticulture businesses (Wente and Concannon), Banks, technology firms, retail businesses, real estate professionals, CPAs, etc. And we have a lot in common with Livermore when it comes to controlled/slow growth, fixed urban boundaries that cannot be changed without a vote, highly educated community, agricultural/open space conservation, bike paths and trails, public amenities, arts and culture motivated, and focus on a thriving downtown (to name a few).
I bring this up, because one of the areas I have been directed to assess and address is business diversification. That includes size and type. And it is important to move towards a broad spectrum so that we become a little more recession proofed and can make sure our entire ecosystem is robust and thriving. A healthy ecosystem means more variety in professional services, real estate brokers, dining and entertainment variety, more industry, more manufacturing… more choices in general. It also means we need more local buying, more local sourcing, more local supply chains, etc.
I think about the Davis Farmer’s Market… it wouldn’t be what it is if we didn’t have choices AND diversity. The attraction is partly because it is a place to make local food choices while creating a community building event. It has grown to be one of the largest and most successful in the state (and nation).
So, yes, I over-stated my point about the importance of medium and large businesses in Davis, but the correction leads to a host of other items to deeply consider… where are they in our community and how do we get them more engaged?
@mrobtwhite: I’m impressed with your enthusiasm, Robb. I wonder what Growth Izzue thinks?
Rob, interesting point. Community service and participation is huge in Davis. It would be interesting to compile a list of the medium and large businesses or units thereof in Davis who participate in the service clubs, boards of local non-profits, city commissions, PTAs, etc. If the participation is low, then one has to ask whether it’s because we have very few medium and large businesses and units thereof. But even then, one would have to ask, what do we have to do to get the few such examples engaged?
-Michael Bisch