City of San Carlos

Council Staff Report

City Council Meeting Date: June 25, 2007

Item Title: Consideration of Adoption of Economic Development Plan

Staff recommends that the City Council hear a presentation on the City Economic Development Plan and then adopt the City Economic Development Plan prepared by the Rosenow Spevacek Group (RSG).

Fiscal Implications

Adoption of the Economic Development Plan and the recommendations contained in the report will have some fiscal implications since the report does recommend a work program in Economic Development for the City.  Funds to carry out the first year tasks in the proposed Economic Development Plan are included in the Redevelopment Agency portion of the 2007-08 Budget.

Background

The City Council has determined that stimulating Economic Development activity in San Carlos is one of its top priorities.  This is reflected in the Council’s Strategic Goals document and has been a key work area for the City Staff in the last two years.

In early 2006, the Economic Development Advisory Commission (EDAC) was reactivated and a new group of commissioners was appointed by the City Council.  Since March 2006, staff has been working with EDAC and they have been helpful advisors to the Staff, Planning Commission and City Council by providing their business insights into the City’s Economic Development work.

Last October, Economics Research Associates (ERA) presented a Real Estate Market Study of San Carlos to EDAC and then followed that up with a presentation to the City Council on November 13, 2006.  In the Market Study report that was heard and approved by both EDAC and the City Council, Bill Lee recommended 4 Economic Development “strategies” that ERA sees as areas that are opportunities in San Carlos.  These strategy areas are:

1.     Reinforce the concentration of construction related businesses on the Eastside in the area bounded by Old Country Road, Industrial Road, Terminal Way and Bing Street.

2.     Encourage medium to larger floor plate retail redevelopment in the corridor along Industrial Road from opposite the parcel designated for hotel use at Holly Street and Industrial Road, along Industrial Road next to Highway 101 to the off-ramp of Highway 101 at Brittan Avenue and Industrial Road.

3.     Use the City’s properties at Wheeler Plaza to create a landmark town center project.

4.     Explore the transition of the Shoreway Road Area to a concentration of biotechnology uses.

Upon completion of the Market Study, staff developed a Request for Proposal (RFP) for a consultant to prepare an Economic Development Plan for San Carlos.  This RFP was sent to 12 firms and the City received two responses that were evaluated.  The process led to a Staff Recommendation and City Council approval of an agreement with the Rosenow Spevacek Group (RSG) for this assignment.

The plan development process included interviews with key businesses and commercial property owners by RSG, meetings with EDAC and the City Council where project comments and input was received by RSG and the City Staff, a community workshop on Economic Development on February 28th and a community wide survey on the ideas suggested by the members of the public and business community.  All of this material was analyzed by RSG and incorporated into a Draft Economic Development Plan that was presented to EDAC at their May 9, 2007 meeting.  A second May meeting of EDAC was held on May 16, 2007 to hear detailed comments and plan priorities from the EDAC Commissioners.  A copy of minutes from the two May EDAC minutes is attached to this staff report along with the Economic Development Plan.

During their review of the Economic Development Plan, EDAC Commissioners developed a “Top 5” list.  These are the areas that the EDAC members feel the City should give top priority to as we begin to use the Economic Development Plan as an action document.  The priority areas from EDAC are:

        Review potential the potential of locating additional mid to large plate retail uses on the East Side area of San Carlos, along Industrial Road.  Some of the potential retail uses are shown in Appendix “I” of the Economic Development Plan.

        A complimentary "anchor" development is needed at the former Bell Market site on Laurel Street.  This would entice people to walk down Laurel Street from Wheeler Plaza.

        The surplus Railroad Property along El Camino Real is seen by RSG as one of the greatest assets to the City’s Economic Development program.  Work with SamTrans and the project developer on the proposed development.  Focus on commercial tenant activity with the developer to insure tie-in with efforts in the Downtown.

        Wheeler Plaza is the City owned parking lot behind Le Boulanger and Foodville.  The City also currently owns property in that area that is rented on a short term basis to a locksmith, liquor store and dry cleaners (along San Carlos Avenue) along with rental housing adjacent to the parking lot.  The plan suggests exploring the potential of a mixed-use project at Wheeler Plaza to draw train passengers and commuter traffic from El Camino Real into the Downtown. 

5.     Develop Landmark Hotel (East Side # 4, Page 22)

        The East Side specific plan talks of a Landmark Hotel site at the Holly Street and Highway 101 interchange.  The ERA Market Study indicates that San Carlos can capture 120 rooms by 2012 and up to 600 hotel rooms by 2025.  The plan suggests soliciting developer interest in hotel development on the East Side.

Additional Comments by EDAC

As noted earlier, the Economic Development Plan includes comments from the EDAC Commissioners in the plan document (see Appendix “J”).  Commissioner comments on the plan are also found in the May 9 and May 16 meeting minutes that are also attached.  Some of the key comments and recommendations from EDAC (in addition to their Top 5 priority list) include:

·         In addition to their recommendation to look at Mixed Use development at Wheeler Plaza, EDAC feels that Mixed Use developments should be considered "throughout the City."

·         Interest has been expressed in exploring a wine bar or brew pub for the Downtown area as "a good first step."

·         EDAC Commissioners feel that the East Side is the area where potential revenue for the City can be located.  EDAC is concerned about the City’s fiscal condition and endorses the idea of using Economic Development to avoid more service cuts in the future.

·         The focus on downtown development should be to “activate” that area as the Economic Development Plan suggests.

·         EDAC supports the development of one or more additional hotels in San Carlos.  This hotel development would not necessarily be limited to the currently designated landmark site.

·         EDAC would support a significant retail development at the landmark site.  This is especially the case if such a development used "green" building techniques.

At tonight’s City Council meeting, RSG will provide a presentation of the Economic Development Plan to the City Council.  They will be available to answer questions from the City Council on the plan, as will Staff. 

After hearing comments from members of EDAC, the business community, property owners and the public, Staff recommends that the City Council provide their comments and any suggested changes to the Economic Development Plan document.  Staff would also recommend that the Council adopt the plan.

Once the City Council has taken action on the Economic Development Plan, Staff will continue to work with key stakeholders in this process including EDAC, the Chamber of Commerce, the Harbor Industrial Area businesses and property owners and residents, to begin the tasks outlined in the work plan portion of the document (see Appendix “A”, starting at page 30 of the plan document).