In an unexpected reversal of City staff’s recommendation, instead of building a $10.1-million multi-story parking structure on the property currently occupied by the BookSmart shopping center as the draft of the Long Range Property Management Plan proposes, the Morgan Hill City Council said Wednesday it now wants to build the facility across Third Street on the former “Sunsweet” property owned by developer Rocke Garcia.
The Council, acting as the Redevelopment Successor Agency board of directors, left the draft LRPMP untouched on a 4-0 vote (Councilwoman Marilyn Librers was absent), but candidly indicated they don’t intend to follow through with the aspect of the document that has drawn the most attention from the public.
The LRPMP is a state mandated plan to dispose of 18 properties formerly owned by the RDA. The plan lists the local preference for how to use or get rid of the properties purchased by the RDA before the state closed the agency last year. The plan mostly reiterates previous RDA and City planning documents going back several years.
Whether or not the City’s change in parking plans will gain approval from the RDA Oversight Board and state Department of Finance is yet to be seen, and Vice Mayor Gordon Siebert even expressed concern about the City’s future actions being perceived as a “bait and switch” by the regulators of RDA dissolution – a tortuous, largely unexplored process that began last year.
With the Successor Agency’s approval Wednesday, the plan will next be considered by the Morgan Hill Redevelopment Oversight Board which contains representatives of the various agencies that stand to gain from RDA dissolution – including the County, City, County Office of Education and state Community Colleges. If the plan makes it past that board, it will be forwarded to the DOF for final approval. After DOF approval, the properties will be transferred or put up for sale as the LRPMP dictates and the City can begin seeking proposals or bids.
In Morgan Hill, the properties contained in the LRPMP include the Granada Theater, Downtown Mall, Royal Clothier and Tryst building, the former site of Simple Beverages and a share of the VTA’s parking lot on Butterfield Boulevard.
The properties now sit in a trust fund awaiting DOF’s approval for further use. The LRPMP proposes selling most of the properties – those containing ground-floor frontage on Monterey Road and downtown side streets – to developers who will agree to build mixed-use residential and commercial projects.
Change of parking plans an uphill battle?
The most controversial aspect of the plan is the proposal to build the parking structure on Depot Street between Second and Third streets, where BookSmart and seven other tenants run firmly established downtown businesses.
Out of concern for the eight tenants on the BookSmart property, the Council said it prefers Garcia’s property for the parking structure. Garcia spoke at Wednesday’s meeting, and told the Council he will gladly participate.
Garcia told the Council that the parking structure on his property, coupled with a residential project he hopes to build on the same site in the future, will be “best for downtown businesses, neighbors and the Third Street Promenade.”
Councilman Larry Carr added while the parking garage was originally proposed to serve both VTA commuters as well as downtown residents and visitors, the priority should be parking for downtown. The LRPMP also contains a proposal to develop the VTA lot – of which the former RDA had a 41 percent ownership share – with a residential project.
The process of convincing the VTA – which owns the other 59 percent of the Butterfield lot – to go along with the parking structure on the Sunsweet site is likely to be fraught with complexities and uphill negotiations, according to discussion at Wednesday’s meeting. The VTA has already indicated its support for a parking garage on the BookSmart property, which is directly across Depot Street from the Caltrain station. The Sunsweet property is one block south of the station, also across Depot Street.
“(We will) tell the VTA we’d love to accommodate both (VTA users and downtown parking), but if it doesn’t, we’re going to build parking for downtown,” Carr said. “(VTA) hasn’t put anything on the table, so I don’t think they should have any authority where it should go.”
The parking structure is also proposed to have retail businesses on the ground floor, City staff said.
Further complicating the new parking proposal is that the RDA in 2010 purchased an option on the BookSmart site for $1.7 million. The Oversight Board and DOF have already approved the use of another $2 million in remaining RDA bond proceeds to complete the purchase of that property, with the understanding it would be used for the “public purpose” of parking.
But if the City decides instead to sell the BookSmart site to a private developer – a possible alternative discussed at Wednesday’s meeting – they will have to sell the option, the current value of which is unknown, according to Santa Clara County Development Asset Manager Glen Williams, who spoke during public comments at Wednesday’s meeting.
Plus, a private developer might not be as sensitive to the BookSmart center’s tenants.
“If a private developer wants to develop it, the relocation problems become magnified,” said Williams, who represents the county on the Morgan Hill Oversight Board. “You’re going to lose a lot of control over (the BookSmart) site if you put it out to market. The option may have very limited value, and you may end up with speculators. We really don’t know what it’s worth.”
Carr wondered if the City might be able to complete the state-approved purchase of the BookSmart site for parking, and then change its mind about the site’s preferred use later.
Williams added later in the meeting, in response to questions from the Council, “If you take the $2 million option and renege on (the DOF-approved use), I wouldn’t want to be in that position.”
For now, the document approved by the Successor Agency and forwarded to the Oversight Board proposes completing the BookSmart purchase for $2 million.
BookSmart co-owner Brad Jones attended Wednesday’s meeting and spoke to the Council during public comments, regarding his and his neighbors’ concerns about staying downtown when they get relocated. Jones said Thursday, after the Council’s decision, that he was encouraged to hear Councilmembers express their devotion to keeping the tenants downtown.
“I’m very glad to hear them say they’re concerned about what happens to the businesses and they’re going to do whatever they can to retain them downtown, even though that’s not part of the (LRPMP),” Jones said. “But they gave their word that they’re going to do everything they could.”
Council: Community Garden can stay
The remainder of the former RDA site proposals remained untouched in the LRPMP. The Council assured Community Garden members that their garden would be able to remain at its current site – which is also part of the LRPMP – for the foreseeable future, and the City will find a new site for them when it’s time to develop the property.
That site, on Butterfield Boulevard between the South County Courthouse and the VTA lot, is slated for a new fire station, which might not be necessary for several years.
“When the Community Garden was formed we approved it with the understanding that that was the future site of a new fire station,” Mayor Steve Tate said. “I don’t see the need (for a fire station) in the near future, and it may be a 10-year horizon before we get started.”
