By Asit Panwala
Four years ago, the City of Morgan Hill sought to rezone industrial land to permit a hotel developer to build a new 150-room hotel. The zoning change would have doubled the value of the land overnight for a windfall of $2 million. More than 4,000 people signed a petition for referendum. The city refused to hold the election and then spent $200,000 of taxpayer money in legal fees trying to prevent the election in court. The California Supreme Court unanimously held that the city was wrong. Did the city learn? No, not at all!
The Morgan Hill City Council is trying to change the land use for another property in order to allow hotel development through Ordinance No. 2295. This time the city seeks to permit hotel use at Madrone Village, where it is currently not allowed. Madrone Village is a shopping center located near Cochrane Road and Madrone Parkway. An out-of-town developer bought the land at a discounted rate ($14.75 a square foot) with the promise that the city would change the zoning for him.
If the new ordinance—which has already been approved by the council—becomes law, the parcel will become worth $1 million more than it was the night before. The developer plans to build two hotels with 206 rooms in total. Neither hotel will have conference room space or banquet facilities.
The existing hotels in Morgan Hill are not against competition, but are against giving handouts to developers. There are already plans to build a 120-room hotel on Cochrane and Butterfield, as well as a boutique hotel downtown. Building two more hotels is not going to attract more businesses. It will not increase the transient occupancy tax because we don’t have enough demand to fill four new hotels with guests. Rather, the taxes will remain flat or decrease because rates and occupancy will drop citywide.
The city tried to interfere with the right to referendum by sending a mass email from Maureen Tobin, a city employee. Ms. Tobin used the email addresses collected by the city to send a political message last Monday, Feb. 11, as if it is was an emergency. Her email argued against signing the petition for referendum, even though she is prohibited from doing so by Government Code 54964. The email falsely claims that the city would lose revenue if voters exercised their constitutional rights. Tobin’s prediction assumes that Morgan Hill will gain an average of 130 new guests a day just because we have two new hotels.
Tobin’s email neglects to mention that our right to referendum is a constitutional right reserved to the people. The email also neglects to mention that the city just increased the transient occupancy tax for hotel guests to 11 percent, which is 2 percent more than Gilroy. It is the city that is misleading the public by promising that the city’s coffers will grow when it is the developer’s wallet that’s growing.
You should sign the petition if you prefer to have a grocery store at Madrone Village instead of hotels. You should sign the petition if you believe incentives should be given to create high-paying jobs rather than minimum wage jobs. Lastly, you should sign the petition if you are tired of the city catering to out-of-town developers who will profit overnight from changes in land use. The constitutional right to exercise the power of referendum was to ensure that local governments did not favor the interests of the few at the expense of the majority. Please sign the petition if you believe you should get to decide this issue.
Asit Panwala is a spokesperson and attorney for the Morgan Hill Hotel Coalition. His family owns the Comfort Inn in Morgan Hill. He can be reached at
as**@pa********.com
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