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Developers prep showdown over transit-oriented development cash

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TOD as we’ve known it will soon be DOA. That’s another reason why Thursday’s Fresno City Council meeting figures to be a doozy.

TOD stands for Transit-Oriented Development. It’s one of the funding sources from Measure C, Fresno County’s transportation sales tax program.

How is TOD money to be spent? Well, the name goes a long way to explaining everything.

Development – houses, offices, retail – is the essence of city life. People have to get from home to work to the store (transportation). It all costs money. Wouldn’t it be nice if development and transportation unfolded in such a way that everyone was happy, including the environment?

TOD money goes to developers (private or public sector) to help defray the cost of turning this dream into reality.

In the end, the Fresno County Council of Governments and the Fresno County Transportation Authority decide who gets TOD money. But these two entities like to have recommendations from Big Shots before making their decision.

This is where the Fresno City Council comes in.

Mayor Ashley Swearengin has a plan for spending this year’s pot of TOD money. The Mayor wants the council to vote “yes” on her plan. The city would then send a recommendation to COG and FCTA saying, in essence, give your TOD money to these projects.

Fresno City Hall is a Big Shot in almost all circumstances, but especially when it comes to TOD. More on that later.

How much is in this year’s TOD pot? About $850,000.

Swearengin wants every penny. She says $425,897 should go to the Fulton Street Reconstruction Project; $711,085 to the South Stadium Project; and $225,527 to the LEDE mixed-used project in the Cultural Arts District.

You say to me: That adds up to $1.36 million.

I know. Swearengin says she wants the OK to spend another $510,000 already earmarked for another Measure C infill development incentive program. You add $850,000 and $510,000 and you get your $1.36 million.

You say to me: OK. What’s the big deal?

It’s this.

This current TOD money is part of a five-year funding cycle. Back on Jan. 1, 2012 (or thereabouts), the folks at COG in essence said: “We’re gonna distribute TOD money every year for the next five years to cities in Fresno County that meet the TOD qualifications.”

You know what? Just one city meets these qualifications (high density was the main one). That city is Fresno.

According to COG officials, about $5 million in TOD money was distributed from 2012 through 2015. Every penny went to Fresno.

Since 2016 is the last year in that five-year funding cycle, that makes the Swearengin recommendation and the council vote on Thursday of the utmost importance. If you’re a developer looking to get a bunch of free money, then getting on the Mayor’s list and getting the council to give that list a big Thumb’s Up is like hitting the lottery.

You say to me: I’m a developer chasing TOD money. If I strikeout in 2016, I’ll just try again in 2017.

Well, go back to my opening sentence. The current TOD distribution system will soon be deader than a doornail. COG and its many committees will soon begin the task of drafting the rules for another funding cycle (don’t know if it’ll be for five years).

The scuttlebutt around town is that all the other incorporated cities in Fresno County aren’t too pleased with Fresno automatically getting all the TOD money. After all, consumers throughout the county pay the Measure C sales tax. Cities throughout the county also have their own development and transportation challenges.

COG and the Transportation Authority are democratic institutions. Majority vote wins. Mayors play a huge role in that voting.

Fresno is one of the county’s 15 incorporated cities. Can you say “14 against 1”?

This brings us back to what’s been happening recently at Fresno City Hall.

TOD money from 2012 through 2015 largely went to City Hall projects, with some going to Granville Homes to help with its mixed-use projects in the Cultural Arts District. The LEDE project belongs to Granville.

So, Granville isn’t left out in the cold should the Mayor get her way on Thursday.

But Granville officials also want to build a mixed-use project on the southwest corner of Clinton and Blackstone avenues. This is the site of the recent Smart and Final controversy. A developer (not Granville) wanted to build a small shopping center with discount retailer Smart and Final as the anchor. Swearengin didn’t like the project’s proposed layout. Smart and Final wouldn’t budge. In the end, Smart and Final went across the street, and the ugliest corner on Blackstone remained ugly.

Granville now owns the site. Granville wants $651,880 of TOD money to help defray the cost of infrastructure at Clinton/Blackstone.

Swearengin wants Granville to have the money, too. But she doesn’t want Granville to get any of that money in 2016. Instead, she telling Granville to apply for $400,000 in 2017 and $251,880 in 2018.

Of course, the mayor is termed out in January 2017. The new mayor will handle the 2017 TOD spending plan. And, of course, the new rules for TOD allocations will come down just as Swearengin is leaving City Hall – and chances are real good that the county’s other cities by then will have their hands on a lot of that TOD money.

Granville has made a formal pitch to city officials. In a document recently filed with the City Clerk’s Office, Granville says the council recommendation that goes to COG should have $425,897 earmarked for the company’s Clinton/Blackstone project.

Granville says the Fulton Mall project should get no TOD money this year. Instead, Granville says, the city should postpone its request for $425,897 of TOD money until 2017.

Granville’s proposal covers 2016 through 2018. It says both the Fulton Mall and Clinton/Blackstone projects can get exactly what they want by the end of that three-year period.

Swearengin in her report to the council says pretty much the same thing.

The dispute comes down which project – Fulton Street restoration or Clinton/Blackstone mixed-use – gets blessed by being in the 2016 council recommendation to COG.

Because it’s only in 2016 that the lucky project is almost guaranteed of getting the money.

There are plenty of other variations to this complex City Hall fight. For example, perhaps the Granville money could come from the money slated by the Mayor for the South Stadium Project (the mixed-use high-rise at the south end of Fulton Mall proposed by developers Mehmet Noyan and Terance Frazier).

Three things are certain.

1.) Swearengin very much wants the Fulton Street restoration project to proceed swiftly and with no uncertainties as to funding.

2.) Noyan and Frazier have been forcefully making their case to city officials in recent days.

3.) Granville, no stranger to City Hall lobbying wars, isn’t ready to give up.

I’ve heard that Granville Vice President Jeff Roberts will be at City Hall on Thursday just in case council members have questions on the LEDE project.

Will Roberts argue in favor of the Clinton/Blackstone project, too?

George Hostetter
George Hostetter is The Sun’s Fresno Civic contributor – covering the City of Fresno, County of Fresno, and Fresno Council of Governments.

2 Comments

  1. There is a huge point of contention that is completely overlooked in this discussion. Fresno does not have a transit system capable of defining itself capable of engaging Transit Oriented Development (TOD). There is criteria necessary to enable financial and government subsidies that qualify for TOD status. Fresno’s bus system does not qualify. Fresno’s bus system is nothing more than an extension of the welfare system; its operation provides social injustice by segregating financial status in its operational design function. It is not designed to provide functional transportation to the general population and is totally incapable of providing a transportation solution to the general population as a source of transportation for any real estate development project.

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