My View: Davis Should Be the Tech Center for the Sacramento Region
in: Breaking News, City of Davis, Economic Development
This week has been a welcome tour for new UC Davis Chancellor Gary May. New beginnings are a time of hope, and so now is a time for new beginnings.
We have pointed out over the last several months that back in 2014 there was great hope that Davis was on a verge of becoming a critical center of high-tech innovation. We had a well regarded Chief Innovation Officer, the Davis Chamber had a regionally respected CEO, the Request for Expressions of Interest (RFEI) process had put forward two innovation park proposals, and UC Davis was in the midst of its own tech-transfer and R&D boom.
One by one those things dropped off. But the arrival of Gary May signals once again a new hope. Chancellor May comes from Georgia Tech, which has its own Midtown Innovation District.
An article in the Sacramento Business Journal noted that Chancellor May "envisions a location similar to Atlanta's Technology Square, a 1.4 million-square-foot, mixed-use development that's home to startups, technology companies, researchers and a variety of innovation industries."
"I am envisioning something like that here. Maybe not a complete duplication because we have different situations and cultures, but I think that could be a real beneficial situation for UC Davis and Sacramento," Chancellor May said.
Of course, Chancellor May is envisioning this perhaps in Sacramento. After all, in June, he joined Sacramento Mayor Darrell Steinberg and others to go to Atlanta to tour their innovation district.
The chancellor noted that "Georgia Tech's initial motivation was expanding for more space, but then the potential economic development and technology benefits became apparent.
"It took a fairly run-down, depressed area of the city and transformed it into a highly vibrant live, learn, work and play environment for not only the campus, but the entire community," Chancellor May said. "Now it's a destination.
"One of the benefits we didn't envision initially that has happened is many of the companies are customers, clients, and collaborators with each other. The whole ecosystem has kind of evolved around that activity," he said.
It is time once again to get the city of Davis on the map.
As Barry Broome who heads up the Greater Sacramento Economic Council put it, "There's 174 university research parks in the United States. For us to have a university doing a billion dollars in research and not have a research park? It's beyond a missed opportunity, it really is negligent. UC Davis is the missing link in this region turning a corner, because it has so much to offer."
What is really negligent is that Davis had the chance to have the infrastructure in place and the space approved to make a push for this but, while we dithered on petty land use issues and squabbled over density and mixed-use housing, time has marched on and we are no longer in position to take advantage of great opportunities.
Think about it – those who are arguing that there is no market for this type of stuff, look at the big wigs trying to line up to get the university to back a regional tech park in Sacramento. Well, why not in Davis?
The advantages of Davis are enormous – we have land, we have an agricultural legacy and world-class soils, we have the university next door and the human capital already in place. All we need is the land to be approved and a catalyst.
Instead, what we have seen is the loss of the Davis Innovation Center when it became clear it was going to be a lift to approve. The Davis Innovation Center had the backing of world-class innovation center developers, Hines. That project has now moved up to Woodland, for the benefit of that community.
In the meantime, we still have the opportunity for the 218 acres at Mace Ranch Innovation Center.
I have suggested that as a great location to have the World Food Center anchor. While the World Food Center would be a university project, the remainder of the center would be startups and spinoffs that arise around that anchor tenant.
In the end, maybe UC Davis wants a more urban setting for the regional tech center, but we are talking about billions of dollars in potential revenue for the region – so why not get a share of that for our community, allowing us to have the fiscal sustainability we need?
It is not too late, but we need to jump on our opportunities while we have them. We can make a positive first impression on Chancellor May and the rest of the region, which considers Davis to be a sleeping giant but also right now an unreliable partner.
We need to start by fast-tracking a process for approval of the Mace Ranch Innovation Center and then build our case that Davis is the place for the Sacramento Regional Tech Center.
Tags:Barry BroomeGary MayInnovation CenterMRICUC DavisWorld Food Center
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38 thoughts on "My View: Davis Should Be the Tech Center for the Sacramento Region"
Keith O August 19, 2017 at 5:53 am
We need to start by fast-tracking a process for approval of the Mace Ranch Innovation Center and then build our case that Davis is the place of the Sacramento Regional Tech Center.
I agree. May has already stated he wants to extend UCD's reach in Sacramento by further exploring the World Food Center. We need to act fast, being that May has already been on trips with Sacramento's bigwigs is our council engaging him before the horse leaves the barn?
David Greenwald Post author August 19, 2017 at 6:23 am
I know the council has engaged him, but I think more important is the council pushing forward with the creation of space for such a center.
Don Shor August 19, 2017 at 6:52 am
I don't know how you fast-track a Measure R vote, and I don't see how we even get to or pass a Measure R vote with the current development team for that site insisting on housing in the project.
Agree, if they keep housing in the mix the project will never get off the ground.
The council has already rejected housing at the site and the developer is looking for an anchor tenant, there is no better or bigger anchor than UCD/ WFC.
there is no better or bigger anchor than UCD/ WFC.
From a fiscal standpoint, there is no worse anchor than UCD.
How come it works for Sacramento? You're buying into the school of thought that there is no such thing as revenue/ tax sharing. Besides – It's simple, you have a small facility that would be the WFC surrounded by start ups and AgTech companies that come into the space that generate taxes.
Matt Williams August 19, 2017 at 10:22 am
Don, you are 100% correct if Davis and UCD (individually and collectively) do not deal with the fiscal issues proactively, up-front. The City of Berkeley and UC have done so, with an annual contribution by UC to the City. The City of Santa Cruz and UCSC have done so, with an annual contribution by UCSC to the City. All it takes is forward thinking, and a commitment to crafting a win-win agreement.
On the other hand, the definition of insanity attributed to Albert Einstein is "doing the same thing over and over again and expecting different results." Bringing that definition and your quote together, I get the following
Repeating the historical fiscal anchor arrangements between UCD and the City is the definition of insanity.
Bottom-line, Pogo said it best, we have met the enemy and they are us.
Don Shor August 19, 2017 at 10:55 am
UCB and UCSC were the result of lawsuits. UCD has no incentive to make deals with the city of Davis about this. They have plenty of other places they could locate. West Sac and Sacramento would probably fall all over themselves to give tax credits and financial incentives to get UCD to locate there. And, of course, UCD could simply build on their own land.
Matt Williams August 19, 2017 at 2:00 pm
Don Shor said . . . "UCB and UCSC were the result of lawsuits. UCD has no incentive to make deals with the city of Davis about this. They have plenty of other places they could locate. West Sac and Sacramento would probably fall all over themselves to give tax credits and financial incentives to get UCD to locate there. And, of course, UCD could simply build on their own land."
If I understand you correctly Don, you see no possible win-win agreement for UCD and the City. Is that correct?
I wholeheartedly disagree with that belief. The "174 university research parks in the United States" have crafted win-win agreements with their host locations. Why is proactively crafting a similar win-win agreement not possible here?
Don Shor August 19, 2017 at 2:27 pm
The "174 university research parks in the United States" have crafted win-win agreements with their host locations.
Don, every one of the 174 is an example. Otherwise those university research parks would not exist.
With that said, now that I am back from my 9,400 cross country trek to the Rockefeller Garden in Seal Harbor Maine, I will attempt to contact the source of David's quote and get the list of the 174 university research parks. Since the reason for the onerous fiscal anchor situation in California is State Law, any one of those university research parks in California will be an example for you.
I don't need the list of the research parks. That is on Wikipedia. I was looking for examples of the "win-win agreements."
Don, every one of them has a win-win agreement, otherwise they wouldn't exist. They would never have gotten the necessary entitlements for construction and operation from their local jurisdiction.
Your original argument, "From a fiscal standpoint, there is no worse anchor than UCD" appears to say that the City of Davis has compelling fiscal reasons not to move forward with creation of a university research park within the city limits … and you provide no compelling non-fiscal reasons why the City should indeed move forward.
If you want to amend your "From a fiscal standpoint, there is no worse anchor than UCD" statement to share your thoughts on compelling non-fiscal reasons, please do so.
I'm actually amazed that so far today no one has pounced on your statement and supported its fiscal premise.
Ron August 19, 2017 at 4:46 pm
Matt: "Don, every one of them has a win-win agreement, otherwise they wouldn't exist."
So, every one of the "174" innovation developments that you're referring to has an agreement which states that any tax revenue which is not owed or paid (as a direct result of having their universities occupy space in the development) will instead be paid by another party?
And, that lawsuits weren't required to make that happen, as was apparently the case at UCSC and UCB?
And, that in each of the 174 other locations, there weren't nearby communities willing to forgo that tax, because they were more desperate for development?
I believe this is what Don was asking.
David Greenwald Post author August 19, 2017 at 5:25 pm
A point here being missed is that if you have the WFC on the site, only a relatively small portion of the site would be university owned and therefore exempted from taxes, but the rest of the site would not be university owned, but may well be attracted by the WFC and generate substantial revenue for the city.
(I realize that Don's question did not actually address WHO ended up reimbursing the lost tax that he referred to, in the case of UCB and UCSC. It may not have been a "third party", as implied in my question.)
I expect that this issue will probably come up again, beyond this particular discussion.
(Yeah – Matt's earlier statement above confirmed that it was UC itself, which "made up for" the lost tax in the case of UCB and UCSC.) Difficult to believe that they would agree to this in Davis, if surrounding communities are willing to bypass that contribution from the get-go. (Especially without a lawsuit, as was apparently the case with UCB and UCSC and their respective host cities.)
David Greenwald said . . . "A point here being missed is that if you have the WFC on the site, only a relatively small portion of the site would be university owned and therefore exempted from taxes, but the rest of the site would not be university owned, but may well be attracted by the WFC and generate substantial revenue for the city."
Land ownership and taxation are just two of the fiscal parameters that would be hashed out in a proactive win-win focused negotiation between the University, the Developer and the City.
That was a step that was conspicuously absent from the Nishi process. The University never came to the table. Don appears to be saying that the University had/has no incentive to do so. Perhaps he will clarify (expand on) what his thinking is on why no such incentive exists.
If only a "small portion" of the site might be occupied by UCD's WFC, then perhaps it's not that big a draw for your hoped-for supporting companies.
UCD is already in Davis. And yet, "demand" for commercial development is apparently still not sufficient based upon that (already massive organization). (At least, not without housing, which I suspect is the ultimate goal.)
If you're arguing that a small-scale WFC is what's needed to generate demand (compared to the already-massive UCD), then your argument doesn't make much sense.
Matt: Again, Don has pointed out that nearby communities (which are generally more "desperate" for development) may be willing to forgo the "lost tax" caused by having UCD occupy space off-campus.
Matt: "That (University involvement) was a step that was conspicuously absent from the Nishi process. The University never came to the table."
Perhaps you'd care to explain why you think they'd do so this time, at a much more distant site – away from UCD. (As the sites become farther, other nearby communities are also more in play. And, if they're willing to forgo the tax caused by having UCD occupy space, they become even more viable from UCD's perspective.)
(Note that I added the phrase in parentheses in Matt's statement above, for clarity.)
To clarify the "lack of" tax generated by having UCD occupy space off-campus.
David Greenwald August 19, 2017 at 6:22 pm
Ron – the WFC is projected as a multi-billion dollar center. The size isn't the issue. They were going to put this at the Railyards, comparable in size to MRIC. Railyards will also have a new Kaiser campus and perhaps a MLS Stadium. I think you're talking about maybe 40 acres for the WFC, out of a 218 acre site.
This will give you a sense for how this could work:
http://www.sacbee.com/opinion/op-ed/soapbox/article90906977.html
David: I took a quick look at your referenced "opinion" article, before being blocked by the SacBee (since I'm not a subscriber). Did I read this correctly – the article was written by an associate director at the WFC?
40 acres (out of the 218 acre site) is pretty substantial, and could represent a significant bypassing of tax revenue. Especially when you consider that housing would also likely occupy a substantial portion of the remaining site.
I'd suggest that a better start (e.g., for Mr. May) might be to (first) focus on providing sufficient housing on campus, due to the financial and non-financial impacts that UCD is already having on the city. (And certainly before considering expanding its size beyond the city's borders, requiring additional costs and creating more housing needs.) (Especially if they're not even willing to pay tax, to offset those costs.)
Again, I hope that Mr. May isn't just listening to boosters of these developments. And, will review what's already occurred with Nishi – even though it essentially bordered UCD property.
Yes the piece is written by the director, just giving you an idea what this would look like.
There is not going to be housing on the site – the council unanimously voted down consideration of the mixed use proposal.
David: "There is not going to be housing on the site – the council unanimously voted down consideration of the mixed use proposal."
I don't believe that past decisions will have much influence. Not sure why you think or state this. However, we shall see what they end up presenting. (And really, even a commercial-only development creates some concerns – as other commenters have pointed out.)
Guess we can't leave a nice piece of farmland (outside a logical delineation road) as is. Somebody's bound to make promises regarding all of the riches it will bring, by approving development on it. Same old, same old.
I fully expect that this will drag on for some time.
No one on council believes that housing on MRIC will pass a Measure R vote. That was their stated opinion last year, that hasn't changed.
David: What I believe may happen is that the owner/developer may find a "desirable" potential tenant, but only on condition of including housing on the site.
Then, the boosters of the proposal will go to work on it (with financial, job, housing, and "green" arguments on its behalf). I believe that many on the council would support a proposal that includes housing. Regardless, council membership is not a permanent position.
The owner/developer is no doubt motivated to develop the site, and will remain so as long as they (or some other like-minded individuals) own the site.
As I said, a long haul, with many possible Vanguard articles to help support it.
Then it won't pass, the council isn't going to take that chance.
Ron August 19, 2017 at 9:58 am
David: "The council has already rejected housing at the site and the developer is looking for an anchor tenant, there is no better or bigger anchor than UCD/ WFC."
Well, if that's (permanently) true, then why do you also state this (from article):
". . . while we dithered on petty land use issues and squabbled over density and mixed-use housing, time has marched on and we are no longer in position to take advantage of great opportunities."
The owner/developer made the decision to pull the plug, unless housing was included. I strongly suspect that the owner/developer's goals will not change.
I hope that the new Chancellor takes the time to understand the concerns of many (and not just rely upon meetings with the council, and what you write on the Vanguard).
David Greenwald August 19, 2017 at 10:41 am
The council made a decision on housing and last I talked to the developer, they were going ahead working around that issue by trying to find an anchor tenant.
Ron August 19, 2017 at 10:48 am
David: We'll see, I guess.
Wondering why they need to "search" for an anchor tenant, if there's such "high demand" for it.
Also wondering how the planned innovation center in Woodland (which is only a few short/easy miles up Highway 113 from UCD) will impact "demand". How many innovation centers are needed in the area? And, why (now) the "sudden need" for a bunch of them, from the demand-side of the equation? (Other than for housing, which I still suspect is the ultimate goal.)
Even in Woodland, the development will include a large-scale housing component. Also wondering who the anchor tenant will be at that facility. (Assuming they've even found one.) Might they be competing for the same types of "anchor tenant"?
Because you need someone who will come in that has the gravitas to attract investors before approving the project.
What they need is someone who will come in and make a bunch of promises, and then state that the proposal is not feasible without housing. (I don't think that strategy will work, but let's see if they give it a try.)
You didn't address most of my questions.
Best I can do on my phone out and about
Todd Edelman August 19, 2017 at 10:27 am
What's funny is that many innovation centers have transport access or siting that is anything but innovative. If the MRIC developers don't push hard for at the very minimum a dedicated bus lane network on the I-80 between 113 and as far as it can go into Sacramento on the 5, 50 and 80, with free shuttles to and from MRIC between Woodland, Vacaville and Sacramento they should be sent to prison.
Todd: I think you are conflating the term innovation center which refers to a high tech park with a number of other uses of innovation to refer to other things as well.
Todd Edelman August 19, 2017 at 1:26 pm
Perchance thou art partaking of the blessed day without irony that is the Sabbath? Can I put it another way…. imagine the MRIC-spot is green forest and you were calling for its removal?