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News: 08/01/2018

Future of SDC main campus raises many questions

Short- and longterm funding and governance are key concerns

Whether the community gets what it wants at the former Sonoma Developmental Center (SDC) main campus or witnesses decades of decay and vandalism behind a cyclone fence depends mainly on two things: whether what it wants is realistic, and whether politicians can find some money. By design, the initial study results shared in June 2018 by consulting firm WRT address how much the redevelopment could cost, but don’t say who should pay.

There are three realistic possibilities for financing SDC’s redevelopment: public money, private developers and public-led development partnerships. Funding methods could be mixed, with specific strategies attached to a building or portion of the project. Defining potential land use on a block-by-block basis would typically be a function of the next phase of the study, yet to be put out for bid.

There has been no announcement of any public development money, only “warm shutdown” funding through next June – the end of the state’s fiscal year. Senator Bill Dodd, one of two state senators with jurisdiction over the SDC, said he believes the governor’s budget proposal for next fiscal year will include the Developmental Center. “In the next budget cycle, I will … seek opportunities for additional funding through the budget committee,” Dodd said in an email. The governor’s office is required to release its budget by Jan. 10, at which time it is subject to legislative amendment before its eventual approval.

Other possible public funding sources include infrastructure bonds, specific tax incentives related to historical building renovation, and, conceivably, funds from the Cal State University budget, were Sonoma State to play a role and exert its influence in Sacramento. The community could also vote to increase its property taxes by passing a parcel tax measure. A two-thirds “yes” vote would be required.

“There’s more than one way to move this forward,” observed Sonoma County First District Supervisor Susan Gorin. “But I suspect it will be a mixture of public and private funding.”

Most agree private money from land developers will be required. In discussions this reporter had with one development firm engaged in large mixed-use projects, the need for eliminating “overwhelming uncertainties” emerged as a critical requirement. What are the site’s acceptable for-profit uses? What are the public benefits that are being targeted for private financing? What are the precise environmental remediation costs and who is paying them? If public funding is to help resolve such uncertainties, spending commitments exceeding year-by-year authorizations would be essential.

It’s likely the public’s interest, as expressed by the initial WRT results, could pose a challenge. The emerging consensus favors community uses, like museums, education and recreation, over more profitable options, such as resorts or luxury housing. The study indicates the community does support the construction of more modest housing, which could still be profitable and thus attractive to developers.

Two site characteristics in particular impact the mathematics of any potential development. First, the site is only accessible from Arnold Drive. It’s easy to predict that the community would balk at a large business complex, however tasteful, if thousands of employees needed to commute to the site every day.

Second is the high cost of removing asbestos and lead from virtually every building; such remediation is most frequently funded by the seller. For example, at the San Francisco Presidio, the U.S. Army paid for the environmental clean up. Here, the owner is the state’s Department of General Services. The department says no decisions have been made about who might pay.

Public funding, when available, is often utilized for environmental remediation and other project elements not typically viewed by developers as profitable. The campus needs new utilities. Transportation and access could be improved, and public money could finance some of the “public benefit” uses the community has proposed.

A third potential funding source is a public-led development partnership, like the San Francisco Presidio. The Presidio Trust has invested some $1.6 billion since 1998; $348 million of that was public money. Other funds came from private investment and philanthropy. Simply putting the land in trust, as was done with the Presidio, will not solve the financing challenge. Establishing a trust ostensibly provides the community with more control of the land, but that depends in large part on controlling who serves on the board of directors.

Development funding and governance are longterm problems. In the shorter term, Supervisor Gorin anticipates that a rider bill during the current legislative session will authorize an additional $3 million for the next phase of land-use planning, which will take two to three years. She also advocates planning for site security and for tenants to begin occupying some buildings as soon as possible. “Fencing alone is not enough,” she said.


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