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The more flexible land use possibilities that the Specific Plan would allow include commercial, office and limited residential. Currently, the zoning in this area allows for light industrial and limited commercial businesses only. Project Area Map
Over the years, the Specific Plan area has experienced economic challenges as the demand for light industrial-type businesses declines and demand for commercial-type uses increases. While the City has worked extensively with property owners and managers to help place tenants through the City’s economic development efforts, current zoning constraints prevent staff from allowing commercial type businesses to move into the area.
The purpose of the Fountain Valley Crossings Specific Plan will be to provide a policy and zoning framework that will allow for additional land-use flexibility in the project area. The City’s goal is to encourage current and future property owners to invest in their property to take advantage of these new development options. This new flexibility will not only allow property owners and businesses to continue to operate as they do today, but will also provide a design framework in which a community activity center district could be created through private investment.
Another purpose of the Specific Plan is to foster the creation of a “Fountain Valley” scale main street experience for residents. This main street environment would provide a gathering place for families and all residents where they can shop and dine.
It is possible that if the Specific Plan is adopted and more retail businesses move into the area and are successful, there will be addition sales tax revenues generated, a portion of which will add to the City General Fund.
In 2015, the City received approximately $2.2 million is sales tax revenue from the businesses within the proposed Specific Plan area. Currently, property owners are limited in the retail businesses that are allowed under the light manufacturing zoning. By allowing more retail businesses to exist in the proposed Specific Plan area the sales tax revenue will be able to increase. Also important to note regarding retail businesses is that the Strategic Market Analysis performed by The Concord Group found that there is demand in the City for an additional 500,000 square feet of retail space. But the retail space is unlikely to be realized if there are not enough customers during all hours of the day and week to patronize the businesses. For this reason, the Strategic Market Analysis found and recommended that a limited amount of residential land uses are also important to include in new vision for the proposed Specific Plan area.
Also in 2015, the City saw approximately $550,000 in property tax revenue. It is important to note that the new Hyundai building, which only makes up 18-acres of the 155-acre Specific Plan area, generates approximately $200,000 in property tax revenue alone. This demonstrates the large difference in the contribution to the City’s tax revenue between properties that have received new investment and properties that have not. The Strategic Market Analysis found that in the future there will be about 350,000 square feet of new office space desired in the City.
The proposed Fountain Valley Crossings Specific Plan generally adds the ability for property owners to lease their property to more types of businesses than they can under the current light manufacturing zoning. The proposed new flexibility in additional businesses that are allowed would increase the value of the property for the property owner. Additionally, retail businesses payer higher rents than light manufacturing businesses do. Therefore property owners would also be able to receive higher rents if they chose to as well.
The City has also considered the costs of providing services if the proposed Fountain Valley Crossings Specific Plan is adopted and properties eventually start seeing new commercial, office and limited residential land uses. These services include police, fire, water, sewer, road maintenance, etc. In this assessment, it was found that the services would not need to be increased significantly and any increases in costs of services for the proposed Specific Plan area would be minimal.
There is no general fund spending involved in this project. Funding sources for the project include former Redevelopment Agency unused bond revenue and a grant from the Southern California Association of Governments (SCAG). The bond revenue is money that can only be spent on projects such as this Specific Plan and cannot be used for general fund spending (i.e. police, fire, and administration operations). The grant obtained from SCAG is funding that is awarded to communities that pursue plans and projects that coordinate land use and transportation actions, demonstrate excellence in planning and design, and improve mobility, livability, and prosperity of the region.
The City of Fountain Valley is not funding any land acquisition or offering construction incentives related to the FV Crossings Specific Plan. The only funds being expended through the City are related to the above noted planning consulting teams.