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August 22, 2006 > A new trend in zoning?

A new trend in zoning?

by Linda Stone

At the Aug. 15 Milpitas City Council meeting, the hot topic was whether the city should amend its General Plan (GP) to permit zoning changes from industrial park to residential.

Applicant, Fairfield Residential LLC, would like to build a 659 unit multi-family, high density development just west of Murphy Ranch Road and Technology Drive. Five of the city's top ten income producers, KLA Tencor, Maxtor/Seagate, SanDisk, Intersil, and Cisco Systems, are located in the immediate area. Fairfield proposes that the city designate this parcel as residential. Specifically, they hoped the city council would not approve a unanimous recommendation from the planning commission that the council deny the proposed amendment.


The denial, on July 26, 2006, included the commission's refusal to review Fairfield's Draft Environmental Impact Report (DEIR), thus signaling their intent and enabling Fairfield to appeal to the City Council.

The commission's primary objections were that residential development adjacent to industrial uses can discourage business expansion, relocation or conversion to accommodate new technologies and processes. They asserted that close proximity of residential and industrial might cause a decline of values to owners on both sides, leading to job losses and discouraging new businesses; all of this would ultimately reduce tax revenues to the city.

The commission found this proposed zoning change unnecessary to overall residential planning because the Midtown Specific Plan and Transit Area Specific Plan envision construction of 10, 700 dwelling units which will provide Milpitas' residential needs for the foreseeable future. They stated that maintaining an inventory of prime industrial land made more sense for the foreseeable future.

Finally, planning commissioners held that the project does not comply with the city's Smart Growth policy of "compact urban form" of high density housing with retail and office space built within walking distance of mass transit. They felt the proposed site was too far from existing amenities.

Applicant's response

Fairfield representative, Ed McCoy opened by noting there was no comprehensive review of the data collected and prepared by staff despite his company's $600,000 investment, to date, on reports and plans.

McCoy pointed out that their proposed site is within a 10 minute walk of two light-rail stations, a park-n-ride, regional open space and major retail areas. He produced an aerial map of San Jose which showed numerous development clusters of side-by-side residential and industrial uses, like the one proposed for Milpitas noting that each of these developments is thriving. He then proceeded to rebut most of the commission's objections with well-reasoned arguments packaged in a professional proposal complete with charts, slides and pictures.

Fairfield's rebuttal asserted that city staff based their recommendation for denial of the appeal on "what if" and "what could be" statements. He noted that concerns about industrial noises, smells and hazardous waste were not sufficient to prevent Cisco Systems from operating a large office complex nearby, complete with a day care licensed for 388 children. And he argued that there is an over saturation of existing industrial space; over saturation of land designated for industrial; and a continuing imbalance of projected jobs to housing ratios.

The commission's argument that Fairfield's plan violated so-called Smart Growth guidelines was not really the heart of this dispute, but McCoy did respond. He pointed out that the Milpitas General Plan identifies Smart Growth through infill development. He mentioned the Midtown Plan as a good example of this concept on a larger scale as it allows high density housing in close proximity to industrial and employment centers. He suggested that the council consider these concepts on a case-by-case basis.

"We request that we be provided the opportunity to present the data and facts of the proposal given that the city regulations do not preclude this request," McCoy said. "We believe staff's recommendation is not based on facts, but rather conjecture. There are GP policies that can be used for both sides of this argument." San Jose has major residential planned on the other side of Coyote Creek, he pointed out. They recognize the ability to mix jobs and housing. "Users surrounding the site are office in nature, not major distribution and ugly, smoke stack industrial. It is a park-like setting, adjacent to a regional trail and regional transportation. Open space will also be provided on-site," Mc Coy stated.

Council's response

Vice Mayor Armando Gomez said that the project was filled with "I don't knows." Council member Debbie Gordano agreed but also felt Fairfield's arguments were noteworthy. She quoted from an Aug. 11 article in "Biz Journal" on housing in the Silicon Valley. "Unless we solve our housing issues we become not a bedroom community but a boardroom community with lack of affordable housing."

Among other council members, Althea Polanski spoke of a pending Industrial Inventory Report (IIR) currently being prepared by city staff. Polanski felt she would need to review this study before deciding for or against the Fairfield project. The report, expected in October, might allay the underlying concern regarding future availability of industrial lands.

Mayor Jose Esteves said the situation was difficult and noted that he "is getting scared that prime property will be lost." He doesn't want businesses to leave and would like to preserve the proposed area for industrial usage.

With Esteves opposed, the rest of the council voted to deny the planning commission's recommendation of denying Fairfield's proposed zoning amendment. Other than their stated interest in reviewing the October study, the council gave no clear direction to Fairfield Residential LLC.

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