Tough Growth Limits Adopted for San Diego : 7-1 Council Vote Cuts Building Permits in Half for Next Year; Developers Predict Loss of Jobs

Responding to the pressures of burgeoning growth that have threatened the delivery of city services, the San Diego City Council early Tuesday adopted a potentially revolutionary ordinance that will reduce by almost 50% the number of residential dwellings that can be constructed in the city during the next year.

In one of the longest City Council sessions in the city’s history, council members listened to 7 1/2 hours of public testimony and debate at the Golden Hall session before voting 8-1 at 2:30 a.m. to put the skids on growth by allowing developers to build only 8,000 dwellings in the next year--a sharp reduction from the 15,000 units developers built in 1986 when low interest rates fueled record construction.

Leading the Nation

In addition to the construction lid, the council agreed in concept to a provision that would strengthen protection for the city’s canyons, hillsides and wetlands threatened by development.

With the vote, San Diego became the largest city in the country to impose such strict growth controls, said a building industry spokesman.

Council members, slow-growth advocates and builders agreed that the Interim Development Ordinance would change the landscape of the construction business in San Diego, which for the past three years has experienced one of the strongest housing markets in the country.

The council decision was hailed by slow-growth advocates and environmentalists as the most significant step taken to date to rein in what they called San Diego’s “runaway” development, which has overburdened streets, sewers, schools and parks.

“It is an absolutely outstanding, monumental victory for conservation and, I think, a balanced approach to protecting the environment of this community,” a tired Councilman Mike Gotch said after the council vote.

Mayor Maureen O’Connor, who lobbied her council colleagues heavily for approval of the interim ordinance, called the vote a “victory for the little guy.

“The council listened to what the community has been saying for the past five years: development has run wild in the community and they want controls,” O’Connor said Tuesday afternoon. “Business as usual at City Hall is no longer that the developer can walk into the door and get what he wants. The council is now in charge of governing this city.”

O’Connor also said the interim ordinance had to be enacted to head off an initiative drive by environmentalists to restrict growth even more--to 6,000 units in the next year.

Defeat for Builders

Kim Kilkenny, spokesman for the Construction Industry Federation, characterized the council vote as an “overwhelming defeat” for builders and other local business interests who argued strongly that any artificial controls on growth would produce economic havoc.

“I think it is very much a signal that the rules are changed forever,” said Kilkenny. “Those were watershed decisions that were made last night, brand new policy.”

Kilkenny said the council’s vote was much more significant than Proposition A, the slow-growth initiative passed in 1985 that requires a citywide vote for any development in the outlying land in San Diego’s booming northern tier.

Kilkenny said the vote sent two messages to the local development industry.

First, developers won’t be able to build any homes unless they first make sure they have adequate thoroughfares, sewers, libraries and parks in place to accommodate the growth.

Secondly--and most importantly--the council is not against imposing “artificial” controls on growth, even if the infrastructure can be guaranteed.

“There will be bankruptcies, there will be foreclosures and there will be layoffs,” Kilkenny said, describing the ramifications of the council’s decision on Tuesday.

“We are going to see the real economic impact in a larger sense 12 and 13 months down the road . . . It’s unavoidable. Real people are going to be losing real jobs.”

Work on the interim measure is not over. While council members approved broad guidelines Tuesday morning, they left many details unresolved and instructed city staff members to report back on July 21 with a plan on how to implement the ordinance.

Who’ll Build What Where?

Those details will include the thorny issues of how to allocate the 8,000 housing units among developers, and what areas should be exempted from the measure.

If at that time the council approves the ordinance in final form, it will take another 30 days--until Aug. 21--before the ordinance is effective, say city attorneys. That lag time gives developers two more months to apply for last-minute building permits in hope of escaping the 8,000 units limit citywide.

“There will be an Oklahoma land rush, no question,” Gotch predicted.

O’Connor, however, said she wasn’t worried about the rush--which actually began in late April when the strict limits were discussed publicly--because the city manager has up to 12 months to issue a building permit after a developer applies. By that time the ordinance will have been enacted and the 8,000-unit cap imposed. O’Connor said she would consider the ordinance to be retroactive to April 29, when the mayor and Councilman Ed Struiksma announced plans in separate press conferences to enact an interim development ordinance with limits on home construction.

Despite the passage of the ordinance, the San Diego housing boom will likely continue its course for a year or so, experts say. Permits already have been issued for 16,679 dwelling units--more than were built in 1986--and these will not be affected by the new ordinance.

The temporary ordinance is meant as a holding action on development while the council begins the arduous process of updating its 1979 Growth Management Plan, which was designed to prevent Los Angeles-type sprawl.

Plan for Gradual Growth

The plan encouraged development in inner-city neighborhoods, while systematically opening up a concentric ring of new land for development. The furthest reaches of the city--prime real estate in the northern tier--was theoretically off-limits to developers until the mid-1990s.

Recent studies have shown, however, that the 1979 plan has worked too well, encouraging overly dense development and nurturing political resentment from San Diegans who sent their children to overcrowded schools and drove down congested streets.

Sensing the growing furor, O’Connor appointed a 27-member citizens’ task force to update the 1979 growth plan. Robert H. Freilich, a Kansas City, Mo., consultant who helped draft the 1979 plan, was asked to review how well the plan was controlling growth.

Freilich’s conclusions were dire: San Diego was overwhelmed by its own growth and would suffer “serious and irrevocable detrimental effects” in its neighborhoods. Freilich, in a report to city planners, proposed a series of caps on the number of dwellings to be built in each of the city’s neighborhoods.

O’Connor and Struiksma--potential opponents in the next mayoral race--seized on Freilich’s conclusions and held rival press conferences April 29 calling for the strict controls.

Those pronouncements added heat to the issue as developers rushed in unprecedented numbers to apply for building permits. The council referred the proposed controls for study to the citizens’s task force, which completed its hasty work last week.

They proposed an emergency ordinance that would take effect immediately upon the council’s vote. It would have allowed 9,300 units to be built citywide.

Set for a Showdown

The stage was set, then, for a dramatic showdown on Monday, when the council met at 7 p.m. to debate the interim measure.

O’Connor’s office sent out 1,600 letters to community groups, urging their members to attend the meeting. The Building Industry Assn. mobilized its forces with a $30,000 newspaper ad campaign that denounced the proposed ordinance as an economic threat.

Between 2,000 and 3,000 people jammed Golden Hall to hoot and applaud as each side presented its arguments for or against the proposed ordinance. Among those speaking out for the interim ordinance were members of a coalition called Citizens for Limited Growth.

Working in conjunction with Gotch, the coalition has prepared a proposed vote initiative that, if passed, would stop growth by limiting developers to as few as 4,000 dwelling units. Coalition members said they would push to put the initiative on the ballot if the interim ordinance was voted down.

On the other side, a consortium of businessmen and labor representatives spoke against the interim measure, saying it would be poison to the local economy. Construction workers worried aloud to council members that their jobs would be imperiled by the measure.

It wasn’t until 12:30 a.m. Tuesday that council members got their first chance to debate the measure and ask questions of staff members.

The council members, unwilling to vote for an emergency ordinance, opted for a regular measure. They also voted several changes to the proposal, including conceptual agreement to protect environmentally sensitive lands--a measure introduced by Gotch.

The council also voted to take immediate steps to collect development fees for homes built in inner-city neighborhoods.

Councilwoman Judy McCarty asked for quarterly reports on the economic and social ramifications of the ordinance. And the council opted to make the interim measure good for 18 months, instead of up to three years, as proposed by the citizens’ task force.

By the time the vote was taken--with only Councilman Bill Cleator dissenting, only a few hundred hangers-on were still in the hall.