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Morgan Hill
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April 14, 2021

City and Responsible Growth Coalition reach compromise

Council expected to place ‘alternative measure’ on 2022 ballot

Proponents of the Morgan Hill Responsible Growth Coalition and city officials have reached a compromise on an ordinance that would define and prohibit fulfillment and distribution centers in the city limits.

The City of Morgan Hill will host an online town hall meeting with the RGC and members of the public on March 25, to present the two parties’ “joint proposal” for a new initiative to appear on the November 2022 ballot, according to city staff.

The city council on March 3 certified the RGC’s original petition, which had been signed by more than 3,500 registered voters. But the council also directed staff to continue working with RGC to “clarify language and develop an ordinance that meets the initiative’s intent while reducing impacts to existing businesses,” says an email newsletter from the City of Morgan Hill.

The ensuing discussions—which had been ongoing since last summer—apparently bore fruit in recent days.

One of the key differences between the original MHRGC initiative and the compromise ordinance is the new version prohibits industrial buildings with a maximum ceiling height of 34 feet over 25 percent of the building’s floor plan; the original MHRGC initiative capped new industrial ceilings at 24 feet. City officials at the March 3 meeting had worried that the 24-foot ceiling maximum would prevent some existing commercial facilities in Morgan Hill with higher ceilings—such as Specialized and Sun Basket headquarters—from being able to expand in the future if they want to.

“The City team and the (MHRGC) met in a collaborative effort to find some middle ground that would achieve both the initiative’s goal of preventing buildings that could house fulfillment and other distribution uses and limiting the number of non-conforming uses that the initiative would create,” said Morgan Hill Development Services Director Jennifer Carman.

City Attorney Don Larkin added that the new joint initiative proposal “revised the definitions significantly to make them more understandable and easier to enforce.”

Since the MHRGC began collecting signatures for the initiative in August, its members and city officials have been at odds over how to reach their mutual goal of prohibiting fulfillment or distribution centers—including “last mile” facilities—in Morgan Hill. 

In October, the city council responded to the MHRGC’s effort by enacting a new ordinance that prohibits fulfillment centers. At the March 3 meeting, Carman explained the city’s ordinance prohibits the facilities by regulating the use of the property, while the MHRGC ordinance bans fulfillment centers by restricting the size and type of proposed new buildings.

The city’s ordinance also requires a public hearing and planning commission review for project proposals defined as “significant:” larger than 75,000 square feet; 40 feet high or taller; or a residential project of 100 units or more.

In addition to a 34-foot maximum ceiling height, the joint proposal that will be the subject of the March 25 town hall would also limit new industrial buildings to 75,000 square feet in size and allow only one loading dock door per 25,000 square feet of proposed building space.

Common arguments against fulfillment centers—cited by council members and MHRGC signatories—include the increased truck traffic, noise and environmental impacts that often come with them. The distribution facilities also do not provide the quality or quantity of jobs—nor the tax revenue—that other types of industrial developers or manufacturers would bring to the community, opponents argue.

When the council voted 3-2 to certify the MHRGC petition March 3, it also authorized city staff to conduct a fiscal analysis of the initiative to be conducted over the following 30 days before voting to place the question on the 2022 ballot. But with the city and coalition having now reached a compromise, the fiscal study may be unnecessary.

City staff explained that the council at an upcoming meeting will likely take a vote to place the joint proposal—rather than the original MHRGC initiative—on the 2022 ballot. Larkin said under state election law, MHRGC proponents Joe Baranowski and Rick Kent could withdraw their initiative at any time. Based on the recent discussions, Larkin expects them to withdraw the original initiative after the council places the compromise on the 2022 ballot as an “alternative measure.”

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