The San Luis Obispo City Council reviewed and endorsed a proposed 322-acre Tank Farm development project designed by the Chevron Corporation on Tuesday.
Located on the north and south sides of Tank Farm Road, the proposed development, which is currently county territory intended to be annexed, stretches from the southern border of the city to the Margarita area, encompassing much of the undeveloped land between Broad and South Higuera streets, according to a 2009 City of San Luis Obispo Planning Commission staff report.
Although Chevron’s project application was accepted by the planning commission in 2009, the corporation still must negotiate a contract with the city before construction can begin.
Chevron anticipates construction will begin in two years and take 25 years to complete.
Chevron plans on filling the two lots with business parks and service and manufacturing centers, as well as public facilities, which will include bike paths, hiking trails and city sanctioned open space, according to the report.
Planners are also considering building baseball fields and bringing a hotel to the area in close proximity to the San Luis Obispo County Regional Airport.
To reduce traffic congestion and make the area more accessible, much of the proposed project consists of road expansion.
If Chevron’s plan is approved, Tank Farm Road will expand to four lanes, and Prado Road and Margarita Avenue will each extend to Broad Street.
The proposed development also contains plans to clear an old reservoir, known as “the Coliseum,” located beside the airport runway along the flight path.
Due to San Luis Obispo Municipal Code Subdivision Regulation 16.20.110, adopted in 2006, Chevron stands to collect payments from the city when terms are reached.
On the grounds that the project is improving property outside of Chevron’s lots, the city intends to “reimburse” the company a prorated amount.
The city hired Goodwin Consulting Group to determine the amount owed to Chevron and the “fair share” Chevron must invest in order to implement the project.
Goodwin concluded the project should cost Chevron $6.1 million, making it more than $11.1 million short of the company’s projected cost of $17.4 million. Goodwin suggested the city “reimburse” Chevron $11.1 million to remain in compliance with its own regulations.
Goodwin Compliance Group also wrote in its report that the project was only feasible if the city paid Chevron the full amount.
“Without reimbursements, it looks like the project doesn’t work; with reimbursement the project looks to be feasible,” the report read.
Chevron agreed with Goodwin’s findings, and one of its representatives lobbied the council Tuesday night to commit the $11.1 million in its entirety.
“We overspend, and we ask for those fees to come back to us,” Chevron project manager Bill Almas said. “We’re not asking for anything from the city except to spend money to reimburse us.”
Though the city council did not commit to “reimbursing” Chevron the entire $11.1 million, council members endorsed the project as a whole and the idea of compensating the company for its effort in improving the community.
Assistant city manager Michael Codron said the city is exploring the idea of paying Chevron through fee credits from future development plans and inspections in the project area.
Like the council, members of the community expressed overwhelming support for the Chevron project. During public comment period, only one San Luis Obispo resident opposed the development plan.
“A deal with Chevron is a deal with the devil,” Will Powers said. “[They are] polluters, human rights violators, murderers of indigenous people … generally terrible stewards of planet earth.”
Vice Mayor John Ashbaugh disagreed.
“I see so many benefits from this agreement that I don’t see how we can tell Chevron to take a hike,” Ashbaugh said.
Ashbaugh also said that choosing to turn down Chevron’s proposal would likely lead to the assumption of the project by the county.
Likewise, Mayor Jan Marx said it is time to move forward on the project.
“This will be like our version of Central Park,” Marx said. “Not that we are New York City, but it is like having a big park in the middle.”