Friday, December 16, 2005 | Two redevelopment projects spearheaded by San Diego State University that would expand the school’s educational, research and retail facilities are currently inundated with litigation and financing worries.
Three organizations have challenged SDSU’s attempts to stretch its facilities across Interstate 8, an effort that would add more than a million square feet to a campus that administrators say needs to expand to accommodate increased demand. This fall the university will enroll about 8,000 of the more than 52,000 students that have applied.
The groups all filed separate claims against SDSU after the California State University board of trustees approved the university’s 20-year expansion plan Sept. 21. The Save Del Cerro committee, Alvarado Hospital and the city of San Diego have since consolidated their respective lawsuits against the school, citing concerns that the university won’t mitigate negative side effects of the development.
Many Del Cerro residents are worried that the expansion across I-8 will increase traffic flow through their neighborhood, endangering their children and crowding their narrow roads.
Usually, a developer must pay to off-set the effects of its development. The fees cover the added strains on roads, services such as police and fire coverage and other infrastructure components.
University architect Tony Fulton said that a contentious California law prohibits public universities from paying for mitigation costs involving roads and other public improvements. A June 17 decision by a California appellate court affirmed this policy, although the decision is being appealed to the California Supreme Court.
The master plan includes adding 540 homes for faculty and graduate students, a 120-room hotel and additional classroom space that will allow SDSU to increase its full-time student capacity from 25,000 to 35,000 by 2025. The project will cost anywhere between $300 million and $500 million.
“If there was ever a poster child for a lousy development idea, this is it,” City Councilman Jim Madaffer said.
A second redevelopment project, the Paseo, is raising eyebrows for a different reason. The $350 million mixed-use project has been in the works for nearly two decades and would provide, among other things, retail, office space and a movie theater that doubles as a classroom on 11 acres of land adjacent to the campus.
However, some wonder if the financing of the current proposal pencils out.
The city redevelopment agency was intent on awarding the SDSU Foundation $26.5 million in financial assistance before the university assumed responsibility of the project. The foundation is the university’s fundraising organization. But when CSU was forced to change the way in which it handled its debt, the SDSU Foundation was no longer able to handle such a large-scale development.
In a June 28 letter to SDSU President Stephen Weber, a former redevelopment official with the city of San Diego said the city would not be offering its funds if the university took control of the project from the foundation. He noted that the university had failed to cooperate with the community in recent projects, citing the construction of Cox Arena and the school’s new trolley stop as examples. He noted that the SDSU Foundation has been much more successful in such negotiations.
Michael Fortney, project manager for the agency, said the city has no plans to provide the funding. However, Weber and Madaffer agreed to establish a Paseo task force to discuss their respective concerns.
Tom Carter, a developer and the leader of Madaffer’s committee, said it will be difficult for the Paseo to compete with Grossmont Centre and other nearby shopping complexes for retail revenue.
These concerns, along with others, make Carter reluctant to allow the project to go ahead with SDSU as the developer.
“My judgment at this point is unless there is a big change in some people’s attitude about it, I don’t think that the Paseo that was planned by the foundation for many years … will be built,” he said, noting that another plan might go forward.
Both sides, however, indicated that SDSU would pay to mitigate the Paseo project if it were to go forward.
Sally Roush, the school’s director of business and financial affairs, said that the Paseo’s retail space does not qualify as one of the university’s core mission activities – in contrast to the master plan. Therefore, retail revenue from the Paseo can be used to pay for some of the necessary improvements.
The Paseo task force has no timeline for ironing out its differences. Officials on both sides agreed at their last meeting to continue with the discussions. A settlement hearing was held last week regarding the Campus Master Plan, but the three opposing organizations still plan to move forward with the lawsuits.