Cities See No Immediate Impact From Cutbacks
In the wake of major cutbacks announced by the Irvine Co., officials in several Orange County cities predicted Wednesday that there would be no immediate impact on the company’s building projects planned for their communities.
The layoff of 240 employees by the county’s largest landowner will not create an overnight slowdown in growth, they said, because the firm already has so many projects under construction.
“People should realize that just because they’re cutting back on personnel doesn’t mean they’ll stop building,” Newport Beach Planning Director Jim Hewicker said, reeling off a list of the firm’s major city developments, including expansion of Fashion Island and an 888-unit residential development.
“If it was going to affect Newport Beach, it would be some years down the road,” he said.
In Tustin, the company is planning to build 8,000 housing units, a golf course, seven parks and commercial developments on 1,740 acres. Mayor Donald J. Saltarelli said Irvine Co. President Thomas H. Nielsen called him Tuesday with assurances that the layoffs would not mean a slowdown in those plans.
“I feel quite confident that they are fully committed to completing the projects in Tustin,” Saltarelli said. “We consider the East Tustin plan to be a very vital project. It’s the last frontier in our city.”
The Irvine Co., which has been employing 1,343 people, announced Wednesday that it will slow down plans for future office development due to a glut of office space in Orange County, Nielsen said. The firm owns 68,000 acres in Orange County, roughly one-seventh of the entire county.
Although Nielsen stressed that there would be no abandonment of the company’s numerous short- and long-term development plans in Orange, Tustin, Newport Beach and Irvine, he said the “precise timing and sequence of these plans may be re-evaluated.”
Might Be Beneficial
In Orange, where the firm is building about 2,000 homes in the Peters Canyon area, Mayor James H. Beam said Wednesday that the cutbacks might prove to be beneficial in terms of long-range plans for an 18,000-acre area east of the city.
“Well, actually, (a slowing of those plans) would be good news,” he said. “There are a lot of people in our community who feel that we were progressing too fast although I don’t agree with them. . . . I have no problem with moving at a slower pace.”
He said there is no determined “slow-growth” movement in the city, adding that Orange is “in very good shape” financially and therefore doesn’t need to speed ahead with development plans. The city has ample reserves, largely due to healthy sales tax revenues generated by two malls and active retail activity along such streets as Tustin Avenue.
“I don’t think it’s an issue of no-growth or slow-growth,” Beam said. “We, like any government, want to be as methodical as possible in our planning.”
Meanwhile, Irvine Councilman Larry Agran contended that the layoffs reflect a “boom or bust” approach to development.
“If we had pursued a policy of modest and sustained growth, perhaps this wouldn’t have been necessary,” he said. Agran added that he hopes the layoffs won’t lessen the firm’s commitment to careful planning.
Recent elections in Irvine put Agran and other “slow-growth” supporters in the majority on the City Council, but the councilman discounted that as a reason for the firm’s announcement Wednesday.
“It’s difficult to believe that cutbacks of this magnitude would come in response to an election result. I’m sure this was planned long before the election,” he said.
For the time being, it will be business as usual, said planners in all four cities.
“We see no change in the status quo. We’ll have plenty of work processing their current projects,” said Paul Brady Jr., Irvine assistant city manager.
