HomeMy WebLinkAboutItem 7b. Introduce Ordinance to amend the Airport Area Specific Plan (SPEC-0457-2023, 120 Venture) Item 7b
Department: Community Development
Cost Center: 4006
For Agenda of: 5/6/2025
Placement: Public Hearing
Estimated Time: 60 minutes
FROM: Timmi Tway, Community Development Director
Prepared By: John Rickenbach, Contract Planner and Rachel Cohen, Principal Planner
SUBJECT: INTRODUCE AN ORDINANCE AMENDING THE AIRPORT AREA
SPECIFIC PLAN TO ALLOW MIXED-USE RESIDENTIAL
DEVELOPMENT WITHIN THE SERVICE COMMERCIAL (C-S) AND
MANUFACTURING (M) ZONES SUBJECT TO A CONDITIONAL USE
PERMIT WHERE APPROPRIATE AND CONSISTENT WITH THE
AIRPORT
RECOMMENDATION
As recommended by the Planning Commission, introduce a Draft Ordinance entitled “An
Ordinance of the City Council of the City of San Luis Obispo, California, amending the
Airport Area Specific Plan to allow mixed-use development in the Service Commercial (C-
S) and Manufacturing (M) zones subject to a conditional use permit where appropriate
and consistent with the Airport Area Specific Plan , including adoption of an addendum to
the Final Environmental Impact Report for the Airport Area an d Margarita Area specific
plans and related facilities master plans.”
REPORT-IN-BRIEF
In 2005, the City adopted the Airport Area Specific Plan (AASP) in the southern part of
the City surrounding the San Luis Obispo County Regional Airport. The specific plan only
included commercial and industrial type uses and development standards based on the
regulations outlined in the 2002 San Luis Obispo County Regional Airport’s Airport Land
Use Plan (ALUP). In 2021, the Airport Land Use Commission (ALUC) updated the ALUP
and removed restrictions to residential development in specific airport safety zones. This
update has provided the City an opportunity to consider mixed-use residential projects
within the AASP.
With the update to the ALUP and the Major City Goal of Housing and Homelessness, City
Council included work program item 3.1.c in the 2023-25 Financial Plan; “Initiate an
update to the Airport Area Specific Plan to allow mixed -use residential development,
where appropriate and consistent with the County Airport Land Use Plan.” In September
2023, the City received an application from a developer to initiate and implement this task
and staff proceeded to evaluate how to allow mixed-use residential development within
the AASP.
Page 273 of 625
Item 7b
The most efficient way to allow for new residential development as part of a mixed-use
project in the AASP was to process a specific plan amendment and require a Conditional
Use Permit (CUP) on a case-by-case project basis. As such, staff is proposing to amend
the AASP to allow mixed-use development within parcels that are currently zoned either
Service Commercial (C-S) or Manufacturing (M) and located within ALUP Safety Zone 6,
subject to a CUP. As part of the CUP process, a project will be required to demonstrate
that it has access to sufficient water and sewer capacity and infrastructure, is fiscally
neutral, compatible with nearby uses, consistent with the ALUP, and that there is
adequate emergency response. Each project would be subject to environmental review
as required by the California Environmental Quality Act (CEQA) as applicable.
POLICY CONTEXT
The proposed amendments are intended to expand housing opportunities in the City by
allowing mixed-use development in areas zoned Service Commercial (C-S) or
Manufacturing (M) within the Airport Area Specific Plan (AASP) consistent with the City’s
General Plan, specifically the Housing and Land Use Elements, and the City’s Major City
Goal of Housing and Homelessness. Table 1 below outlines the goals, policies, and
programs that support the proposed amendments.
Table 1: Major City Goals and General Plan Policy Consistency
Goal/Policy/Program Consistency Analysis
Major City Goal
Housing and Homelessness. Support
the expansion of housing options for all,
and continue to facilitate the production of
housing, including the necessary
supporting infrastructure, with an
emphasis on affordable and workforce
housing as well as accessibly connected
development. Collaborate with local non-
profit partners, non-governmental
agencies, the county, the state, and
federal governments to advocate for
increased funding and implementation of
comprehensive and effective strategies to
prevent and reduce homelessness.
Consistent. The proposed amendments
allowing mixed-use in the AASP directly
addresses this major city goal by creating
an additional area of the City that can
accommodate housing in the City.
Work Program Item #3.1.c. Initiate an
update to the Airport Area Specific Plan
to allow mixed-use residential
development, where appropriate and
consistent with the County Airport Land
Use Plan.
Consistent. The proposed amendments
to the AASP would fulfill MCG work
program item 3.1.c to allow additional
residential development as part of a
mixed-use project consistent with the
ALUP.
Page 274 of 625
Item 7b
Goal/Policy/Program Consistency Analysis
General Plan Housing Element
Program 5.5. Update the Zoning
Regulations to allow mixed-use
development within Service Commercial
(C-S) and Manufacturing (M) zones
without a use permit within one year of
the adoption of the Housing Element.
Consistent. Program 5.5 has already
been implemented in C-S and M zones
throughout the City, with the exception of
several specific plan areas, such as the
AASP. W ith the recent update of the
Airport Land Use Plan (ALUP), there is
now an opportunity to implement this
program in the AASP. However, a
Conditional Use Permit (CUP) would be
required subject to specific findings due
to existing conditions in the AASP.
Program 6.13. Consider General Plan
amendments, as projects are proposed,
to rezone commercial, manufacturing, or
public facility zoned areas for higher-
density, infill or mixed-use housing, where
compatible with surrounding
development…
Consistent. While Program 6.13
encourages mixed-use residential
development through amendments to the
General Plan (and not to specific plans),
its intent is consistent with the specific
plan amendment currently being
proposed, which would allow for mixed-
use residential development in a
substantial portion of the City where it
had not been previously allowed, and
would have a similar effect to what would
occur through a General Plan
amendment.
General Plan Land Use Element
Policy 3.8.5. Mixed Uses. The City
encourages compatible mixed uses in
commercial districts.
Consistent. By allowing for mixed-use
residential development within the
Service Commercial and Manufacturing
zones within the AASP, the project
directly implements this policy.
DISCUSSION
Background and Project Description
In 2005, the City adopted the Airport Area Specific Plan (AASP) which provides a
regulatory framework for planning future development on approximately 1,200 acres in
the southern portion of the City near the San Luis Obispo County Regional Airport. The
AASP outlines allowed uses and development standards that were guided by the 2002
San Luis Obispo County Regional Airport’s Airport Land Use Plan (ALUP). The basic
function of the ALUP is to promote compatibility between airports and land uses that
surround them. The 2002 ALUP included several safety zones and noise contours that
Page 275 of 625
Item 7b
limited or prohibited residential and non-residential development. Based on these
prohibitions, when the AASP was adopted, it did not allow mixed -use residential
development for consistency with the ALUP.
In 2020, the City adopted the Housing Element and included Program 5.5 that called for
updating the Zoning Regulations “to allow mixed -use within Service Commercial (C-S)
and Manufacturing (M) zones without a use permit within one year of the adoption of the
Housing Element.” In 2021, the City Council adopted an update to the Zoning Regulations
that removed the Conditional Use Permit (CUP) requirement and allowed m ixed-use by
right in the C-S and M zones. However, updates could not be made to specific plan areas
such as the AASP because of the existing 2002 ALUP safety zone and noise contour
limitations.
As the City was updating the Zoning Regulations in 2021, the Airport Land Use
Commission (ALUC) was updating the ALUP, including revisions to the safety zones and
noise contours. Specifically, the ALUP revisions removed the limitation on residential
density within Safety Zone 6, the General Traffic Pattern Zone (see Figure 2 and
Attachment C), and noise contour areas were narrowed and located closer to the runways
(see Attachment D). The removal of these restrictions to residential development provides
an opportunity to consider mixed-use residential projects within the AASP.
Based on the update to the ALUP and Major City Goal of Housing and Homelessness,
City Council included work program item 3.1.c in the 2023-25 Financial Plan; “Initiate an
update to the Airport Area Specific Plan to allow mixed -use residential development,
where appropriate and consistent with the County Airport Land Use Plan.” As such, the
City is proposing to amend the AASP to allow mixed-use development within parcels
zoned either Service Commercial (C-S) or Manufacturing (M) in ALUP Safety Zone 6. A
Figure 1: Map outlining the boundaries of the Airport Area Specific Plan
Page 276 of 625
Item 7b
Conditional Use Permit (CUP) will be required to evaluate existing conditions in the AASP
such as water and sewer capacity and infrastructure , fiscal neutrality, compatibility with
existing uses, consistency with the ALUP, and emergency response.
Project Location and Affected Parcels
The Project Area includes all property within ALUP Safety Zone 6 (the least restrictive
Safety Zone) and designated as Service Commercial (C-S) or Manufacturing (M) within
the 1,200-acre AASP planning area. Figure 2 shows the location of C-S and M zoned
areas within the AASP and their relationship with all the ALUP safety zones . Safety zones
near the San Luis Obispo County Regional Airport are designated areas with land use
restrictions to minimize risks from potential aircraft accidents. They include six zones:
Runway Protection Zone (Zone 1), Inner and Outer Approach/Departure Zones (Zone 2
& 4), Inner Turning Zone (Zone 3), Sideline Zone (Zone 5), and Traffic Pattern Zone (Zone
6), each defined by proximity to the runway and typical aircraft operations. Safety Zone 6
is the area that is in pink on the map. Figure 3 highlights the C-S and M zoned areas that
fall specifically within ALUP Safety Zone 6. It should be noted that C-S and M zoned areas
that fall within Safety Zone 6, but outside the Airport Area Specific Plan, are already
allowed by right to include housing within a mixed-use development per the Zoning
Regulations.
A land use inventory was prepared to determine the amount of C-S or M zoned lands
within the AASP. Table 2 below summarizes the total acreage of vacant and developed
parcels in these two land use designations.
Table 2: Summary of Land Use Inventory C-S and M Parcels in the AASP
Land Use Designation
Acreage
Developed
(or entitled) Vacant Total
Service Commercial (C-S) 140.4 85.6 226.0
Manufacturing (M) 94.7 20.4 115.1
Total 235.1 106.0 341.1
Of this total, 236.4 acres are fully within Safety Zone 6, while the remaining 104.7 acres
are at least partially within that safety zone. Consistent with ALUP policies and the AASP
as proposed for amendment, residential portions of a mixed-use development could be
considered on the portion of any parcel wholly within Safety Zone 6, even if the remainder
of the parcel is within a more restrictive safety zone.
Page 277 of 625
Item 7b
Figure 3: This map shows the Airport Safety Zones overlaid on the parcels zoned
C-S and M within the AASP. The pink colored areas indicate Safety Zone 6; red is
Safety Zone 1; orange is Safety Zone 2; yellow is Safety Zone 3; light blue is Safety
Zone 4; and light purple is Safety Zone 5. A larger map is provided as Attachment
C.
Figure 2: Outlined in black are the areas of the AASP that are zoned C-S and M
and fall within ALUP Safety Zone 6.
Page 278 of 625
Item 7b
Fiscal Impacts Related to Future Development Under the Specific Plan Amendment
When the AASP was annexed into the City, a tax sharing agreement between the City
and County specified a formula for tax sharing that was determined by the zoning
designations in effect at the time of annexation. As discussed above, most of the property
in the AASP was annexed as commercial and industrial. The agreement specifies that
there will be no or limited property tax sharing in favor of the City, in consideration of sales
tax revenues that were previously shifted to the City upon annexation, and in anticipation
of future sales tax generation by future hypothetical commercial uses. As a result,
allowing housing in this area of town, has a different fiscal impact on the City than it does
in other areas.
As part of this work program effort, the City hired consultant Kosmont to prepare a fiscal
impact analysis to examine the effects of allowing mixed -use residential development
within the C-S and M zones in the AASP based on this agreement (see Attachment E).
The analysis evaluated two development scenarios within the AASP to estimate net fiscal
impacts from potential future development. The first examined likely development in the
AASP under current market conditions based on the existing General Plan and AASP,
which do not allow for mixed-use. The second scenario reflects the potential for mixed-
use residential development in the AASP in the C -S and M zones. In both cases, the
analysis considered current market conditions and demand, which is generally stronger
for residential than the predominantly industrial uses currently allowed in the AASP.
Development Scenarios, Assumptions, Conclusions
Existing General Plan and AASP Scenario. While the 2014 LUCE land use scenario
(office, retail, industrial with no residential) would achieve an annual fiscal “surplus” for
the City’s General Fund, Kosmont’s study identifies that the level of office and retail land
uses assumed does not reflect current market and economic conditions (this is
additionally evidenced in the lack of non-residential development over the last 10 years),
and is therefore an unrealistic view of what is likely to be developed in the foreseeable
future.
Mixed Use Scenario. Kosmont’s study further explores that a more likely future AASP
land use development scenario would include a mix of uses, in cluding both “vertically”
blended uses (e.g., housing over commercial), as well as “horizontally” blended uses
(e.g., commercial or hospitality behind or adjacent to housing). Based on this, Kosmont
in consultation with City staff developed a potential mar ket-based, blended-use land use
scenario, primarily based on a combination of demonstrated developer interest within the
City, Kosmont’s previous market supply and demand analysis in the region, and broader
real estate development trends across the State and nationally. Assumptions also reflect
proposed and approved projects within the AASP, but excludes the remaining residential
units within Avila Ranch, as that project already includes a maintenance Community
Facilities District (CFD) to augment funding for municipal services.
Page 279 of 625
Item 7b
In this scenario, this analysis projects a net negative fiscal impact for the General Fund,
driven largely by the tax sharing agreement that limits the City’s receipt of property tax
revenue from new development in this area.
Kosmont’s Recommendations
In order to support long-term fiscal solvency for the City General Fund while not
overprescribing non-residential uses beyond market and financial feasibility, and while
not relying solely on future non-residential uses which are difficult to predict, Kosmont
identifies four potential strategic approaches to achieving fiscal neutrality:
1. Maintenance/services Community Facilities District (CFD), similar to the
mechanism utilized for the Avila Ranch development project within the City
potentially most feasible strategy)
2. Renegotiation of the Property Tax Sharing Agreement with the County
3. Infrastructure Financing District negotiation with the County (as a backup to #2
above)
4. Minimum commercial use requirements for residential projects
Kosmont’s report recommends that the most feasible approach of the four is to implement
a CFD. However, without a CFD, fiscal neutrality can also be achieved on a project-by-
project basis, through the implementation of Homeowners Associations or similar
mechanism where fees are collected from homeowners to provide public services or by
providing sufficient commercial development to off -set the residential development. The
proposed specific plan amendment responds to this analysis by conditioning approval of
the CUP for any individual project on the requirement that the applicant offset any fiscal
impact of the project to the City in order to ensure fiscal neutrality.
Conditional Use Permit Requirements
It is important to understand why a Conditional Use Permit (CUP) will be required for
mixed-use development within the AASP when one is not required for similar
development in other areas of the City. As discussed previously, in 2020 the City updated
the Zoning Regulations to allow mixed-use within Service Commercial (C-S) and
Manufacturing (M) zones without a use permit (as directed by Housing Element Program
5.5), however the AASP was not considered as a part of this update. When the ALUP
was updated, the City identified an opportunity for expanding residential mixed-use
developments within the AASP. The most efficient way to unlock the potential for new
residential development in this area of the City is to process this broad specific plan
amendment, and require a CUP on a case-by-case basis as projects are proposed. The
alternative would be to complete an extensive evaluation of the entire specific plan area
that could take years and additional funding to complete.
In addition, the CUP allows for site-by-site analysis and the ability to condition a project
based on that analysis. The AASP contains a mix of unique uses (e.g. industrial, airport
operations, large business parks, etc.) that may or may not be compatible with residential
development. Through the CUP process, the City can consider these adjacent uses and
Page 280 of 625
Item 7b
condition future projects to ensure compatibility. In addition, because this area was
annexed into the City from the County, the City has a tax sharing agreement with the
County that is not the same as other areas of the City, which results in unique fiscal
concerns (see fiscal analysis discussion above). Further, as this area was not previously
envisioned for housing, public services and infrastructure must be studied to ensure that
proposed developments can be supported. The CUP provides a mechanism to evaluate
whether a proposed mixed-use development provides all the necessary elements for a
compatible, fiscally neutral infrastructure, and City service supported development.
Lastly, the CUP process allows for flexibility in the design of future proposed projects to
address the unique aspects of this area. For example, the City zoning regulations do not
currently include a minimum amount of commercial area for a property to be considered
mixed use. Instead of prescribing one-size-fits-all standards that may or may not work for
property owners, the City is retaining flexibility, with an understanding that there are
unique fiscal challenges in this area that would require a careful balance of housing and
commercial development in projects as they are proposed. This balance can be ensured
through review and approval of a CUP.
Per Chapter 17.106 of the City’s Zoning Regulations, new mixed-use projects will be
subject to development review. In addition, most of the potential parcels are over five
acres in size and would not be eligible for categorical exemption from CEQA. The CUP
would be processed concurrently with the required development review and
environmental review required for a new mixed-use project.
Overview of Proposed Amendment to the AASP
The City is proposing to amend the AASP to allow mixed -use development within Service
Commercial (C-S) or Manufacturing (M) zoned parcels with the approval of a Conditional
Use Permit (CUP). As noted above, the residential portion of a mixed-use development
would only be considered within ALUP Safety Zone 6, and none of the other Safety Zones.
No development would occur directly because of this action. No existing zoning
designations are proposed to change. Instead, the resulting amendment would allow
mixed-use residential development, subject to specific findings, and consistent with the
requirements of the City’s Zoning Regulations1 as they currently apply to C-S and M
designated lands in the rest of the City.
Planning Commission Resolution No. PC-1098-2025 (Attachment B) includes the
legislative draft of the proposed amendments to the AASP. The crucial aspect of these
changes relates to the findings that would need to be made for the Planning Commission
to approve a CUP for a mixed-use residential project within the AASP. These findings
include:
1. There is demonstrable water and sewer capacity to serve the project;
2. Any fiscal impact of the project to the City must be offset to achieve fiscal neutrality;
3. There are no nearby uses that generate sufficient air emissions, noise, odors or
vibration to create an incompatibility with proposed mixed -use development;
1 San Luis Obispo Municipal Code Section 17.70.170.
Page 281 of 625
Item 7b
4. Proposed mixed-use residential development is consistent with land use, safety or
noise restrictions set forth in the ALUP, and any residential portion of a mixed-use
development shall be wholly located within Safety Zone 6; and
5. There is adequate emergency response consistent with the Climate Adaptation
and Safety Element (CASE).
Future individual project applications would be reviewed by the City through its normal
development and conditional use permit review processes and would be subject to
environmental review under the California Environmental Quality Act (CEQA) as
applicable. Note, the magnitude and timing of mixed-use development on the AASP is
speculative at this time, and would be influenced by a variety of factors, including market
demand, property owner desire to develop, consistency with the Airport Land Use Plan
(ALUP), and potential environmental constraints that may apply to specific parcels where
project development applications are under consideration.
Previous Action and Public Engagement
Airport Land Use Commission – January 15 and February 19, 2025
On January 15, 2025, the project was informally presented to Airport Land Use
Commission (ALUC) for preliminary review. Per the ALUP, the ALUC is required to review
certain types of actions that affect land use in the vicinity of the airport to ensure that the
action proposed by the referring agency, the City, is consistent with the ALUP. The ALUC
provided comments, which were addressed by City staff and included in ALUC’s staff
report for a formal conformity determination, which occurred on February 19, 2025. At
that meeting, ALUC found the project to be in conformance with the ALUP, subjec t to
findings and conditions, which have been incorporated into the proposed AASP
amendment (Attachment F).
A key ALUC condition limits the construction of the residential portion of mixed-use
development to Safety Zone 6, and not in any of the more restr ictive safety zones (see
Figure 2). However, nearly all the C-S and M zoned parcels are either wholly located or
mostly located in Safety Zone 6. In all, 117 of the 132 parcels zoned C-S or M are wholly
within Safety Zone 6, encompassing 236 acres. Of the remaining 15 parcels (104 acres),
most include substantial area within Safety Zone 6. As the AASP amendments have been
found to be in conformance with the ALUP, future mixed -use residential development
projects in the AASP will not be required to be reviewed by the ALUC.
Planning Commission – February 26, 2025
The Planning Commission reviewed the proposed specific plan amendment s on February
26, 2025, which incorporated the recommendations of the ALUC. The Planning
Commission unanimously recommended that the City Council approve the proposed
amendments with a minor edit to the amendment to add the language “consistent with
the Climate Adaptation and Safety Element (CASE)” to the end of the CUP Finding #5 for
clarification (Attachment B). Public notice was provided for the Planning Commission
meeting and the opportunity for public comment was provided during that meeting. No
one commented at the Planning Commission meeting.
Page 282 of 625
Item 7b
SLO Chamber of Commerce Economic Development Committee – April 3, 2025
City staff provided a presentation to the Economic Development Committee on the
proposed amendments to the AASP and answered questions the committee had about
the proposed changes.
Public notice of the City Council meeting has been published in a widely circulated local
newspaper, and hearing agendas for this meeting have been posted at City Hall and
online, consistent with adopted notification procedures.
CONCURRENCE
Planning Division Staff, as well as the City Attorney’s office, have reviewed the proposed
amendments to the AASP and any feedback has be en incorporated in the draft ordinance.
ENVIRONMENTAL REVIEW
The Final Programmatic EIR for the Airport Area and Margarita Area Specific Plans and
Related Facilities Master Plans (“Final EIR”, or “AASP Final EIR”) addressed future
development within the Airport Area Specific Plan. The Final EIR was certified in
September 2003 and has provided the basis for evaluating the impacts of future
development within the AASP area. Subsequent amendments to the AASP were subject
to separate CEQA evaluations to address the potential impacts stemming from those
amendments.
An Addendum to the Final EIR has been prepared to address changes to the approved
project, and is included as Attachment G. Pursuant to Section 15164(b) of the CEQA
Guidelines, an addendum to an adopted Final EIR may be prepared by the Lead Agency
that prepared the original Final EIR if only minor technical changes or additions are
necessary or none of the conditions described in Section 15162 have occurred that
require preparation of a subsequent EIR. An Addendum is appropriate to address the
modified project because the proposed changes to the approved project do not meet the
conditions of Section 15162(a) for preparation of a subsequent EIR.
The County of San Luis Obispo Airport Land Use Commission conducted an Initial Study
and prepared a Negative Declaration for the 2021 update of its Airport Land Use Plan
(ALUP). That environmental document was used in part to inform some of the conclusions
contained in the Addendum prepared for the proposed AASP amendment.
FISCAL IMPACT
Budgeted: N/A Budget Year: 2024-25
Funding Identified: N/A
Page 283 of 625
Item 7b
Fiscal Analysis:
Funding
Sources
Total Budget
Available
Current
Funding
Request
Remaining
Balance
Annual
Ongoing
Cost
General Fund $N/A $ $ $
State
Federal
Fees
Other:
Total $N/A $0 $0 $0
There are no fiscal impacts directly related to approval of the specific plan amendments.
No previously unanticipated fiscal impacts would occur as a result of this action. Please
see the discussion above regarding fiscal impacts related to future development under
the specific plan amendment.
ALTERNATIVES
1. Adopt the proposed Ordinance with modifications. The City Council could
propose modifications to the proposed ordinance including modifications to any of the
findings or amendments.
2. Continue consideration of the proposed amendments. An action continuing the
project should include direction for staff on pertinent issues that should be further
studied or analyzed for future presentation to the Council, with consideration that the
Council has provided direction to staff via Work Program Item #3.1.c. to “Initiate an
update to the Airport Area Specific Plan to allow mixed -use residential development,
where appropriate and consistent with the County Airport Land Use Plan.”
3. Deny the project. The City Council could decide not to adopt the attached Ordinance.
Amendments to the AASP are required to be made per Work Program Item #3.1.c.
which supports Major City Goals and the City’s General Plan. Denying the proposed
amendments would also provide a barrier to future housing production that will be
required by the state. If Council pursues this option, they should provide findings that
cite the basis for denial, which should reference inconsistency with Major City Goals,
General Plan, or other relevant policy documents.
ATTACHMENTS
A - Draft Ordinance adopting amendments to the AASP
B - Planning Commission Resolution PC-1098-2025
C - ALUP Safety Zones Overlaying the AASP
D - ALUP Noise Contours Overlaying the AASP
E - Fiscal Impact Analysis
F - Notice of Airport Land Use Commission Action
G - Addendum to Final EIR
Page 284 of 625
O ______
ORDINANCE NO. ____ (2025 SERIES)
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF SAN LUIS
OBISPO, CALIFORNIA, AMENDING THE AIRPORT AREA SPECIFIC
PLAN TO ALLOW MIXED-USE DEVELOPMENT IN THE SERVICE
COMMERCIAL (C-S) AND MANUFACTURING (M) ZONES SUBJECT
TO A CONDITIONAL USE PERMIT WHERE APPROPRIATE AND
CONSISTENT WITH THE AIRPORT LAND USE PLAN, INCLUDING
ADOPTION OF AN ADDENDUM TO THE FINAL ENVIRONMENTAL
IMPACT REPORT FOR THE AIRPORT AREA AND MARGARITA
AREA SPECIFIC PLANS AND RELATED FACILITIES MASTER
PLANS, AS REPRESENTED IN THE CITY COUNCIL AGENDA
REPORT AND ATTACHMENTS DATED MAY 6, 2025 (SPEC-0457-
2023)
WHEREAS, it is a Major City Goal to address housing and homelessness by
supporting the expansion of housing options for all, and continue to facilitate the
production of housing; and
WHEREAS, the General Plan Land Use and Housing Elements include numerous
policies that support the development of additional housing to meet ongoing dema nd; and
WHEREAS, the City has allowed for mixed-use development in Service
Commercial (C-S) and Manufacturing (M) zones throughout the City except in the Airport
Area Specific Plan (AASP) in order to help address ongoing housing demand; and
WHEREAS, the City has not allowed for mixed-use development in C-S and M
zones in the AASP because of density and land use restrictions set forth in the 2002 San
Luis Obispo County Airport Land Use Plan (ALUP) in effect at the time of the adoption of
the AASP in 2005; and
WHEREAS, the San Luis Obispo County Airport Land Use Commission updated
the ALUP in 2021 in such a way that provides an opportunity for mixed-use residential
development in the C-S and M zones within the AASP; and
WHEREAS, the Airport Land Use Commission of the County of San Luis Obispo,
upon receipt of a formal referral from the City of San Luis Obispo, conducted a hearing
on February 19, 2025, and determined the proposed amendments to the AASP are
consistent with the ALUP subject to findings and conditions; and
WHEREAS, the Planning Commission of the City of San Luis Obispo conducted a
public hearing in the Council Chamber of City Hall, 990 Palm Street, San Luis Obispo,
California on February 26, 2025, and recommended adoption of amendments to the
AASP to allow mixed-use development within specified areas of the Service Commercial
(C-S) and Manufacturing (M) zones subject to a conditional use permit where appropriate
and consistent with the ALUP; and
Page 285 of 625
Ordinance No. _____ (2025 Series) Page 2
O ______
WHEREAS, the City Council of the City of San Luis Obispo conducted a public
hearing in the Council Chamber of City Hall, 990 Palm Street, San Luis Obispo, California
on May 6, 2025, for the purpose of approving amendments to the AASP to allow mixed -
use development within specified areas of the Service Commercial (C-S) and
Manufacturing (M) zones subject to a conditional use permit where appropriate and
consistent with the ALUP; and
WHEREAS, notices of said public hearings were made at the time and in the
manner required by law; and
NOW, THEREFORE, the City Council of the City of San Luis Obispo does hereby
ordain as follows:
SECTION 1. Findings. Based upon all the evidence in the record, the Council
makes the following findings:
1. The proposed amendment to the Airport Area Specific Plan (AASP) is consistent
with the intent of the General Plan because it will not result in additional impacts
beyond those anticipated in the Airport Area and Margarita Area Specific Plans
and Related Facilities Master Plans Final EIR, and becaus e the concept of mixed
uses in appropriate locations within the city is supported in multiple policies within
the General Plan, notably in the Housing and Land Use Elements.
2. The proposed AASP amendments are intended to allow for mixed -use
development consistent with the intent of the General Plan and in a manner
generally consistent with how it is considered in C-S and M zones elsewhere in the
City.
3. The proposed AASP amendments do not substantively change the policy
framework or overall land use, or circulation pattern envisioned in the originally
adopted Specific Plan.
4. The proposed AASP amendments will not cause serious health problems,
substantial environmental damage, or cause impacts beyond those disclosed in
the certified Final EIR and Addendum for this action.
SECTION 2. Environmental Review. An addendum to the certified Final
Environmental Impact Report (FEIR) (SCH #2000051062) for the Airport Area and
Margarita Area Specific Plans and Related Facilities Master Plans was prepared to
address changes to the previously-approved project, pursuant to Section 15164(b) of the
CEQA Guidelines, since only minor technical changes or additions are necessary to the
certified Final EIR and none of the conditions described in Section 15162 of the CEQA
Guidelines have occurred that require preparation of a subsequent EIR.
The project is consistent with the certified Final Environmental Impact Report (FEIR) for
Airport Area and Margarita Area Specific Plan and Related Master Plans under the
California Environmental Quality Act (CEQA) in conjunction with an Addendum prepared
Page 286 of 625
Ordinance No. _____ (2025 Series) Page 3
O ______
pursuant to CEQA Guidelines 15164. All mitigation measures adopted as part of the Final
EIR that were included in the Airport Area Specific Plan that are applicable to the
proposed Specific Plan Amendment (SPA) are carried forward and applied to the
proposed SPA to effectively mitigate the impacts that were previously identified.
SECTION 3. Action. The Airport Area Specific Plan is hereby amended as
follows:
Chapter 1—Introduction
Page 1-3. Environmental Review. Add the paragraph below after the first paragraph on
the page.
Pursuant to Section 15164(b) of the CEQA Guidelines, an Addendum to the Final EIR
was prepared to address changes to the Specific Plan Amendment approved in 2025,
which allowed mixed-use development in Service Commercial (C-S) and Manufacturing
(M) zones subject to a Conditional Use Permit within the AASP.
Page 1-7. The Planning Process. Add the paragraph below at the end of this section.
In 2025, the AASP was amended to allow mixed -use in the Service Commercial (C-S)
and Manufacturing (M) zones subject to a Conditional Use Permit and findings described
in Table 4-3, consistent with the 2021 amended and restated San Luis Obispo County
Regional Airport Land Use Plan.
Chapter 3—Conservation and Resource Management
Page 3-12. Aircraft Operations. Add the paragraph below to the end of this section:
The Airport Land Use Commission adopted a major amendment to the Airport Land Use
Plan on May 26, 2021. The amended and restated ALUP provides for noise contours that
are tied to aircraft and airport activity that are consistent with adopted federal Terminal
Area Forecasts, and on safety zones that are based on and consistent with those
described in the Caltrans Airport Land Use Planning Handbook. These revised safety
areas and noise contours have the general effect of opening certain areas in the AASP
to residential development.
Chapter 4—Land Use
Page 4-2. Land Use Background. Modify the third paragraph as follows:
The land use plan was developed to ensure compatibility with airport operations. The
designated AASP land uses are consistent with the airport safety areas in the San Luis
Obispo County Regional Airport Land Use Plan (ALUP), as amended in 2021. Generally,
the critical areas in line with the runway centerlines will be maintained as open space.
Lower intensity warehousing, manufacturing, service, business park and mixed -use
development are designated for the less sensitive zones to the sides of the runways, and
further out from the ends of the runways.
Page 287 of 625
Ordinance No. _____ (2025 Series) Page 4
O ______
Page 4-3. Land Use Background. Remove Table 4-1 (Airport Area Specific Plan Land
Use Program and Development Capacities) and all references to Table 4-1 in the entire
text of the Specific Plan.
Page 4-23. Table 4-3. Allowed Uses. Amend Table 4-3 to include a line item for Mixed-
Use, indicating that it is allowed with a Conditional Use Permit and add notes #9 and #10
at the end of the table that refers to the development standards and findings for mixed -
use development within the C-S and M zones as written below.
Table 4-3 – Allowed Uses
Key:
A = Allowed
D = Allowed by Administrative Use Permit
PC = Allowed by Planning Commission Use Permit
Land Use
Zoning District
PF C-S M BP
MIXED-USE (also see Footnote 9 & 10) PC PC
Footnote:
9. In order to approve a Conditional Use Permit (noted as PC in Table 4-3) for a mixed-
use development in the C-S and M zones, the Planning Commission shall find the project
consistent with development standards outlined in San Luis Obispo Municipal Code
Section 17.70.130 (Mixed-use development) and make the following findings:
1) There is demonstrable water and sewer capacity to serve the project;
2) Any fiscal impact of the project to the City must be offset to achieve fiscal
neutrality;
3) There are no nearby uses that generate sufficient air emissions, noise, odors
or vibration to create an incompatibility with proposed mixed -use development;
4) Proposed mixed-use residential development is consistent with land use,
safety or noise restrictions set forth in the ALUP and any residential portion of
a mixed-use development shall be wholly located within Safety Zone 6; and
5) There is adequate emergency response consistent with the Climate Adaptation
and Safety Element (CASE).
10. Avigation easements shall be recorded for each property prior to the issuance of a
building permit. All owners, potential purchasers, occupants (whether as owners or
renters), and potential occupants (whether as owners or renters) shall receive full and
accurate disclosure concerning the noise, safety, or overflight impacts associated wi th
Airport operations prior to entering any contractual obligation to purchase, lease, rent, or
otherwise occupy the subject property or properties.
Page 288 of 625
Ordinance No. _____ (2025 Series) Page 5
O ______
Page 4-28. Table 4-5. Building Intensity and Coverage Standards. Amend Table 4-5 to
indicate a maximum Floor Area Ratio (FAR) of 1.5 for the C-S and M zones for mixed-
use development as shown below.
Table 4-5
San Luis Obispo Airport Area Specific Plan
BUILDING INTENSITY AND COVERAGE STANDARDS
Also See Table 4-6. Limitations on employee and customer concent rations due to
airport safety are more restrictive than the standards provided below in most cases
and may reduce maximum potential FAR.
Design Standard
Land Use Designation
Business
Park
Service
Commercial Manufacturing
Maximum floor area ratio: mixed-
use development
n/a 1.5 1.5
Page 4-30. Table 4-8. Parking Standards. Add the following note to Table 4-8:
(b) Parking standards for the residential component of mixed-use projects in the C-S and
M zones must be consistent with the parking standards for residential uses as set forth in
Section 17.72 of the Zoning Regulations.
Chapter 5—Community Design
Page 5-15. Goal 5.4, Guideline I. Modify as written below.
In R-3 and R-4 zones, as well as in the residential portions of mixed-use projects, parking
bays and garages shall be placed adjacent to non-residential uses or adjacent to noise
exposure areas to the extent possible to buffer sound impacts.
Page 5-18. Standard 5.6.2. Modify as written below.
Each commercial, industrial loading, outdoor recycling or waste collection area shall be
located on the side of a building opposite from parcel lines or street frontages of any land
designated for residential use, or for mixed-use projects, separated or screened from the
residential portion of the project to the extent possible.
Page 5-38. Table 5-5. Add a footnote to Table 5-5 as follows:
Residential landscape design standards also apply to mixed -use projects within the
Service Commercial and Manufacturing land use categories.
Chapter 8—Public Facilities Financing
Page 8-15. Add a new Section as follows:
Page 289 of 625
Ordinance No. _____ (2025 Series) Page 6
O ______
8.6.4 Fiscal Neutrality
In order to support long-term fiscal solvency for the City General Fund while not over -
prescribing non-residential uses beyond market and financial feasibility, and while not
relying solely on future non-residential uses which are difficult to predict, mixed-use
projects will be required to achieve fiscal neutrality. It is recommended that the City
implement a Community Facilities District (CFD), similar to the mechanism used for the
Avila Ranch development project, that could be applied to the AASP. However, without
a CFD or another mechanism that can apply to the entire AASP, fiscal neutrality can also
be achieved on a project-by-project basis, through the implementation of Home Owners
Associations or similar mechanisms that use fees collected from homeowners to provide
public services.
Chapter 9—Implementation
Page 9-2. Section 9.4, Architectural Review. Modify as written below.
Consistent with required citywide procedures, commercial, industrial, institutional, mixed-
use and residential developments will be subject to architectural review.
Page 9-3. Section 9.8, Environmental Review. Add the following sentence to the end of
this section:
All individual development projects within the AASP that require discretionary approval
are subject to project-specific environmental review as applicable under the California
Environmental Quality Act (CEQA).
SECTION 4. Severability. If any subdivision, paragraph, sentence, clause, or
phrase of this Ordinance is, for any reason, held to be invalid or unenforceable by a
court of competent jurisdiction, such invalidity or unenforceability shall not affect the
validity or enforcement of the remaining portions of this Ordinance, or any other
provisions of the City’s rules and regulations. It is the City's express intent that each
remaining portion would have been adopted irrespective of the fact that any one or
more subdivisions , paragraphs, sentences, clauses, or phrases be declared invalid or
unenforceable.
Page 290 of 625
Ordinance No. _____ (2025 Series) Page 7
O ______
SECTION 5. Publication. A summary of this ordinance, together with the names
of Council members voting for and against, shall be published at least five (5) days prior
to its final passage, in The New Times, a newspaper published and circulated in this City.
This ordinance shall go into effect at the expiration of thirty (30) days after its final
passage.
INTRODUCED on the ____ day of ______ 2025, AND FINALLY ADOPTED by
the Council of the City of San Luis Obispo on the ___ day of ___, 2025, on the following
vote:
AYES:
NOES:
ABSENT:
___________________________
Mayor Erica A. Stewart
ATTEST:
___________________________
Teresa Purrington
City Clerk
APPROVED AS TO FORM:
__________________________
J. Christine Dietrick
City Attorney
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the
City of San Luis Obispo, California, on _______________________.
___________________________
Teresa Purrington
City Clerk
Page 291 of 625
Page 292 of 625
RESOLUTION NO. PC-1098-25
A RESOLUTION OF THE SAN LUIS OBISPO PLANNING COMMISSION
RECOMMENDING APPROVAL OF AMENDMENTS TO THE AIRPORT
AREA SPECIFIC PLAN TO ALLOW MIXED-USE DEVELOPMENT
WITHIN THE SERVICE COMMERCIAL (C-S) AND MANUFACTURING
M) ZONES SUBJECT TO A CONDITIONAL USE PERMIT WHERE
APPROPRIATE AND CONSISTENT WITH THE AIRPORT LAND USE
PLAN; AND A DETERMINATION THAT THE PROJECT IS CONSISTENT
WITH THE CERTIFIED FINAL EIR FOR AIRPORT AREA AND
MARGARITA AREA SPECIFIC PLANS AND RELATED FACILITIES
MASTER PLANS (FEIR) WHEN CONSIDERED IN CONJUNCTION WITH
AN ADDENDUM TO THE FINAL EIR; AS REPRESENTED IN THE
AGENDA REPORT AND ATTACHMENTS DATED FEBRUARY 26, 2025
SPEC-0457-2023)
WHEREAS, the 2014 General Plan Land Use and Circulation Elements (LUCE)
update includes numerous policies that support the development of additional housing,
particularly affordable housing, to meet ongoing demand; and
WHEREAS, consistent with Housing Element Program 5.5, the City in 2021
updated Title 17 (Zoning Regulations) to allow for mixed-use development in Service
Commercial (C-S) and Manufacturing (M) zones by right throughout the City except in
Specific Plan Areas such as the Airport Area Specific Plan (AASP) in order to help
address ongoing housing demand; and
WHEREAS, the City has not allowed for mixed-use development in Service
Commercial (C-S) and Manufacturing (M) zones in the AASP because the 2002 San Luis
County Regional Airport (SBP) Airport Land Use Plan (ALUP) established safety and
noise areas that limited or prohibited noise sensitive residential uses or high-density
residential development in effect at the time of the adoption of the AASP in 2005; and
WHEREAS, the San Luis Obispo County Airport Land Use Commission (ALUC) in
2021 amended and restated the ALUP to address new technical information related to
safety and noise, which resulted in a refinement of areas subject to land use restrictions
under the ALUP, including areas within the AASP and as a result, there is now substantial
area within the AASP where the land use restrictions have changed and created
opportunities for mixed-use developments within the AASP; and
WHEREAS, the Airport Land Use Commission of the County of San Luis Obispo,
upon receipt of a formal referral from the City of San Luis Obispo, conducted a hearing
on February 19, 2025, and determined the proposed SPA is consistent with the San Luis
Obispo County Regional Airport Land Use Plan subject to conditions, pursuant to a
proceeding instituted under SPEC-0457-2023, City of San Luis Obispo, applicant; and
Page 293 of 625
Resolution No. PC-1098-25
SPEC-0457-2023 (Citywide)
Page 2
WHEREAS, the Planning Commission of the City of San Luis Obispo conducted a
public hearing in the Council Chamber of City Hall, 990 Palm Street, San Luis Obispo,
California on February 26, 2025, for the purpose of recommending amendments to the
AASP to allow mixed-use development within the Service Commercial (C-S) and
Manufacturing (M) zones subject to a conditional use permit where appropriate and
consistent with the ALUP; and
WHEREAS, notices of said public hearings were made at the time and in the
manner required by law; and
WHEREAS, the Planning Commission of the City of San Luis Obispo has duly
considered all evidence, including the testimony of the applicant, interested parties, and
evaluation and recommendations by staff, presented at said hearing; and
NOW, THEREFORE, BE IT RESOLVED by the Planning Commission of the City
of San Luis Obispo as follows:
SECTION 1. Findings. Based upon all evidence, the Planning Commission makes
the following findings:
1. The proposed amendment to the Airport Area Specific Plan (AASP) is consistent
with the intent of the General Plan because it will not result in additional impacts
beyond those anticipated in the Airport Area and Margarita Area Specific Plans
and Related Facilities Master Plans Final EIR, and because the concept of mixed
uses in appropriate locations within the City is supported in multiple policies within
the General Plan, notably in the Housing and Land Use elements.
2. The proposed AASP amendments are intended to allow for mixed-use
development consistent with the intent of the General Plan and in a manner
generally consistent with how it is considered in C-S and M zones elsewhere in the
City.
3. The proposed AASP amendments do not substantively change the policy
framework or overall land use or circulation pattern envisioned in the originally
adopted Specific Plan.
4. The proposed AASP amendments will not cause serious health problems,
substantial environmental damage, or cause impacts beyond those disclosed in
the certified Final EIR and Addendum for this action.
SECTION 2. Environmental Review. An addendum to the certified Final
Environmental Impact Report (FEIR) (SCH #2000051062) for the Airport Area and
Margarita Area Specific Plans and Related Facilities Master Plans was prepared to
address changes to the previously-approved project, pursuant to Section 15164(b) of the
CEQA Guidelines, since only minor technical changes or additions are necessary to the
certified Final EIR and none of the conditions described in Section 15162 of the CEQA
Page 294 of 625
Resolution No. PC-1098-25
SPEC-0457-2023 (Citywide)
Page 3
Guidelines have occurred that require preparation of a subsequent EIR.
The project is consistent with the certified Final Environmental Impact Report (FEIR) for
Airport Area and Margarita Area Specific Plan and Related Master Plans under the
California Environmental Quality Act (CEQA) in conjunction with an Addendum prepared
pursuant to CEQA Guidelines 15164. All mitigation measures adopted as part of the Final
EIR that were included in the Airport Area Specific Plan that are applicable to the
proposed Specific Plan Amendment (SPA) are carried forward and applied to the
proposed SPA to effectively mitigate the impacts that were previously identified.
SECTION 3. Action. The Planning Commission hereby recommends to the City
Council the introduction and adoption of an ordinance to amend the AASP to allow mixed-
use development within the Service Commercial (C-S) and Manufacturing (M) zones
subject to a conditional use permit where appropriate and consistent with the ALUP as
set forth in Exhibit A and incorporated herein.
On motion by Vice Chair Houghton, seconded by Commissioner Munoz-Morris, and on
the following roll call vote:
AYES: Commissioners Munoz-Morris, Flores, Jorgensen, Vice Chair
Houghton and Chair Cooley
NOES: None
ABSENT: Commissioners Kahn and Tolle
RECUSED: None
The foregoing resolution was adopted this 26th day of February 2025.
Tyler Corey, Secretary
Planning Commission
Page 295 of 625
Resolution No. PC-1098-25
SPEC-0457-2023 (Citywide)
Page 4
EXHIBIT A
PROPOSED AMENDMENTS TO THE AIRPORT AREA SPECIFIC PLAN TO ALLOW
MIXED-USE DEVELOPMENT WITHIN THE SERVICE COMMERCIAL (C-S) AND
MANUFACTURING (M) ZONES SUBJECT TO A CONDITIONAL USE PERMIT WHERE
APPROPRIATE AND CONSISTENT WITH THE AIRPORT LAND USE PLAN
Additions to the Airport Area Specific Plan language is shown in underline text, with
language to be removed shown in strikethrough text.
Chapter 1—Introduction
Page 1-3. Environmental Review. Add the following paragraph following the first
paragraph on the page, which describes the CEQA review that was conducted for this
specific plan amendment.
Pursuant to Section 15164(b) of the CEQA Guidelines, an Addendum to the Final EIR
was prepared to address changes to the Specific Plan Amendment approved in 2025,
which allowed mixed-use development in Service Commercial (C-S) and Manufacturing
M) zones subject to a Conditional Use Permit within the AASP.
Page 1-7. The Planning Process. Add a new paragraph at the end of this section related
to allowing mixed-use in the Service Commercial (C-S) and Manufacturing (M) zones
within the AASP:
In 2025, the AASP was amended to allow mixed-use in the Service Commercial (C-S)
and Manufacturing (M) zones subject to a Conditional Use Permit and findings described
in Table 4-3, consistent with the 2021 amended and restated San Luis Obispo County
Regional Airport Land Use Plan.
Chapter 2—The Planning Area
No changes proposed.
Chapter 3—Conservation and Resource Management
Page 3-12. Aircraft Operations. Add the following to the end of this section:
The Airport Land Use Commission adopted a major amendment to the Airport Land Use
Plan on May 26, 2021. The amended and restated ALUP provides for noise contours that
are tied to aircraft and airport activity that are consistent with adopted federal Terminal
Area Forecasts, and on safety zones that are based on and consistent with those
described in the Caltrans Airport Land Use Planning Handbook. These revised safety
areas and noise contours have the general effect of opening certain areas in the AASP
to residential development.
Page 296 of 625
Resolution No. PC-1098-25
SPEC-0457-2023 (Citywide)
Page 5
Chapter 4—Land Use
Page 4-2. Land Use Background. Modify the third complete paragraph on Page 4-2 as
follows:
The land use plan was developed to ensure compatibility with airport operations. Uses
that have high concentrations of people or are sensitive to airport noise (e.g., low density
residential, schools, hospitals, etc.) are not included in the planning area. The designated
AASP land uses (Figure 4-1) are consistent with the airport safety areas in the San Luis
Obispo County Regional Airport Land Use Plan (ALUP), as amended in 2021. Generally,
the critical areas in line with the runway centerlines will be maintained as open space.
Lower intensity warehousing, manufacturing, service, business park and mixed-use
development are designated for the less sensitive zones to the sides of the runways, and
further out from the ends of the runways.
Page 4-3. Land Use Background. Remove Table 4-1 (Airport Area Specific Plan Land
Use Program and Development Capacities) as shown below and all references to Table
4-1 in the text of the Specific Plan.
Page 4-23. Table 4-3. Allowed Uses. Amend Table 4-3 to include a line item for Mixed-
Use, indicating that it is allowed with a Conditional Use Permit. Add the following note
9) at the end of the table that refers to the development standards and findings for
Page 297 of 625
Resolution No. PC-1098-25
SPEC-0457-2023 (Citywide)
Page 6
mixed-use development within the C-S and M zones. Specific proposed changes to Table
4-3 are shown below as underlined text:
Table 4-3 – Allowed Uses
Key:
A = Allowed
D = Allowed by Administrative Use Permit
PC = Allowed by Planning Commission Use Permit
Land Use
Zoning District
PF C-S M BP
MIXED-USE (also see Footnote 9 & 10) PC PC
Footnote:
9. In order to approve a Conditional Use Permit (noted as PC in Table 4-3) for a mixed-
use development in the C-S and M zones, the Planning Commission shall find the project
consistent with development standards outlined in San Luis Obispo Municipal Code
Section 17.70.130 (Mixed-use development) and make the following findings:
1) There is demonstrable water and sewer capacity to serve the project;
2) Any fiscal impact of the project to the City must be offset to achieve fiscal
neutrality;
3) There are no nearby uses that generate sufficient air emissions, noise, odors
or vibration to create an incompatibility with proposed mixed-use development;
4) Proposed mixed-use residential development is consistent with land use,
safety or noise restrictions set forth in the ALUP and any residential portion of
a mixed-use development shall be wholly located within Safety Zone 6; and
5) There is adequate emergency response consistent with the Climate Adaptation
and Safety Element (CASE).
10. Avigation easements shall be recorded for each property prior to the issuance of a
building permit. All owners, potential purchasers, occupants (whether as owners or
renters), and potential occupants (whether as owners or renters) shall receive full and
accurate disclosure concerning the noise, safety, or overflight impacts associated with
Airport operations prior to entering any contractual obligation to purchase, lease, rent, or
otherwise occupy the subject property or properties.
Page 4-28. Table 4-5. Building Intensity and Coverage Standards. Amend Table 4-5 to
indicate a maximum Floor Area Ratio (FAR) of 1.5 for the C-S and M zones, including for
mixed use development in those zones, in order to be consistent with the maximum FAR
Page 298 of 625
Resolution No. PC-1098-25
SPEC-0457-2023 (Citywide)
Page 7
in C-S and M zones elsewhere in the City. Specific changes are shown below in underline
text.
Table 4-5
San Luis Obispo Airport Area Specific Plan
BUILDING INTENSITY AND COVERAGE STANDARDS
Also See Table 4-6. Limitations on employee and customer concentrations due to
airport safety are more restrictive than the standards provided below in most cases
and may reduce maximum potential FAR.
Design Standard
Land Use Designation
Business
Park
Service
Commercial Manufacturing
Maximum floor area ratio: mixed-
use development
n/a 1.5 1.5
Page 4-30. Table 4-8. Parking Standards. Add the following note to Table 4-8:
b) Parking standards for the residential component of mixed-use projects in the C-S and
M zones must be consistent with the parking standards for residential uses as set forth in
Section 17.72 of the Zoning Regulations.
Chapter 5—Community Design
Page 5-15. Goal 5.4, Guideline I. Modify as follows:
In R-3 and R-4 zones, as well as in the residential portions of mixed-use projects, parking
bays and garages shall be placed adjacent to non-residential uses or adjacent to noise
exposure areas to the extent possible to buffer sound impacts.
Page 5-18. Standard 5.6.2. Modify this standard as follows:
Each commercial, industrial loading, outdoor recycling or waste collection area shall be
located on the side of a building opposite from parcel lines or street frontages of any land
designated for residential use, or for mixed-use projects, separated or screened from the
residential portion of the project to the extent possible.
Page 5-38. Table 5-5. Add a footnote to Table 5-5 as follows:
Residential landscape design standards also apply to mixed-use projects within the
Service Commercial and Manufacturing land use categories.
Chapter 6—Circulation & Transportation
Page 299 of 625
Resolution No. PC-1098-25
SPEC-0457-2023 (Citywide)
Page 8
No changes proposed.
Chapter 7—Utilities & Services
No changes proposed.
Chapter 8—Public Facilities Financing
Page 8-15. Add a new Section 8.6.4 as follows:
8.6.4 Fiscal Neutrality
In order to support long-term fiscal solvency for the City General Fund while not over-
prescribing non-residential uses beyond market and financial feasibility, and while not
relying solely on future non-residential uses which are difficult to predict, mixed-use
projects will be required to achieve fiscal neutrality. It is recommended that the City
implement a Community Facilities District (CFD), similar to the mechanism used for the
Avila Ranch development project, that could be applied to the AASP. However, without
a CFD or another mechanism that can apply to the entire AASP, fiscal neutrality can also
be achieved on a project-by-project basis, through the implementation of Home Owners
Associations or similar mechanisms that use fees collected from homeowners to provide
public services.
Chapter 9—Implementation
Page 9-2. Section 9.4, Architectural Review. Modify this section as follows:
Consistent with required citywide procedures, commercial, industrial, institutional, mixed-
use and multi-family residential construction developments will be subject to architectural
review. For projects subject to architectural review, the “minor or incidental” procedure
should be used for those projects meeting this Specific Plan’s design standards.
Page 9-3. Section 9.8, Environmental Review. Add the following to the end of this section:
All individual development projects within the AASP that require discretionary approval
are subject to project-specific environmental review as applicable under the California
Environmental Quality Act (CEQA).
Page 300 of 625
Ta n k Farm
South Higuera Tank Farm
I n d u s t r i a l
Hoover
F i e r o
A e r o
Lo
n
g
Granada
Suburban
Va
c
h
e
l
l
Buckley Buckley
S a n ta F e
A e r o v is t a
PoinsettiaClarion
MM
M
M
M
C-SC-S C-S
C-S
M
M
C-S
C-S
C-S
C-SC-SC-S
C-S
C-S
C-S
C-S
C-SC-S
C-S
C-S
C-S
C-S
C-SC-S
C-S
M
M
C-S C-S
C-S
C-SC-S
C-S
C-S
C-S
Airport Area Specific Plan (AASP)
Airport Safety Zones
µ
0 0.5 10.25 Miles
Airport Area Specific Plan
City Limit
Zoning
Service Commercial (C-S)
Manufacturing (M)
Airport Safety Zones
Zone 1: Runway Protection Zone
Zone 2: Inner Approach/Departure Zone
Zone 3: Inner Turning Zone
Zone 4: Outer Approach/Departure Zone
Zone 5: Sideline Zone
Zone 6: Traffic Pattern Zone SLOGIS
January 2025Page 301 of 625
Page 302 of 625
Airport Area Specific Plan (AASP)
Airport Noise Contours
SLOGIS
January 2025
Ta n k Farm
South Higuera Tank Farm
I n d u s t r i a l
Hoover
F i e r o
A e r o
Lon
g
Granada
Suburban
Va
c
h
e
l
l
Buckley Buckley
S a n ta F e
A e r o v is t a
PoinsettiaClarion
MM
M
M
M
C-SC-S C-S
C-S
M
M
C-S
C-S
C-S
C-SC-SC-S
C-S
C-S
C-S
C-S
C-SC-S
C-S
C-S C-S
C-S
C-SC-S
C-S
M
M
C-S C-S
C-S
C-SC-S
C-S
C-S
C-S
0 1 20.5 Miles
µ
Airport Area Specific Plan
City Limit
Zoning
Service Commercial (C-S)
Manufacturing (M)
Noise Contour Levels
60 dB CNEL
65 dB CNEL
70 dB CNEL
75 dB CNEL
Page 303 of 625
Page 304 of 625
2301 Rosecrans Ave., Suite 4140
El Segundo, CA 90245
TEL: 424-297-1070 | URL: www.kosmont.com
CITY OF SAN LUIS OBISPO
AIRPORT AREA SPECIFIC PLAN (AASP)
FISCAL IMPACT SCENARIO ANALYSIS
AUGUST 2024
Page 305 of 625
KOSMONT COMPANIES | 2
BACKGROUND & PURPOSE
•The City of San Luis Obispo (“City”) Airport Area Specific Plan (“AASP” or “Specific Plan”) was originally
established to exclude housing development, due to Airport Safety Zone issues.
•In recent years, the County of San Luis Obispo (“County”) has redefined the Safety Zones, resulting in
almost 90% of the Commercial / Services / Manufacturing (“CSM”) zoning area in the AASP to be
considered safe for housing development.
•As a result, property owners have requested City approval for mixed-use housing at densities in the range
of 24 units per acre with nominal commercial development.
•The existing City/County tax sharing agreement specifies a formula for tax sharing within the AASP that is
determined by the zoning at the time of annexation. Importantly, most of the property in the AASP was
annexed as commercial and industrial. The agreement specifies that there will be no or limited property tax
sharing in favor of the City, in consideration of sales tax revenues that were previously shifted to the City
upon annexation, and in anticipation of future sales tax generation by future hypothetical commercial uses.
Page 306 of 625
KOSMONT COMPANIES | 3
BACKGROUND & PURPOSE (CONTINUED)
•The recently certified Housing Element modified City zoning restrictions to encourage more housing and
the City has expressed interest in understanding how a large portion of the future industrial / commercial
business base will be impacted by more housing in the future, and how this would impact the City’s
General Fund.
•It is important to note that prior zoning (e.g., 2014 Land Use and Circulation Element, or “LUCE”)
reflected assumptions about commercial and industrial land use development that may not reflect current
market and economic conditions.
Page 307 of 625
KOSMONT COMPANIES | 4
SUMMARY OF FINDINGS
•Kosmont has evaluated several different scenarios of land use development within the AASP, including
scenarios that reflect the original 2014 LUCE vision, and scenarios that reflect recent developer interest,
in order to estimate General Fund net fiscal impacts from potential future development.
•While the 2014 LUCE land use scenario (office, retail, industrial with no residential) would achieve an
annual fiscal “surplus” for the City’s General Fund, it is Kosmont’s opinion that the level of office and retail
land uses assumed does not reflect feasibility in consideration of current market and economic conditions
(additionally evidenced in lack of non-residential development over previous 10 years)
•On the other hand, if the remainder of developable land within the AASP is developed entirely consistent
with recent developer interest (higher-density residential with limited commercial components), this
analysis estimated a negative net fiscal impact for the General Fund, driven largely by the tax sharing
agreement that limits the City’s receipt of property tax revenue from new development in this area.
Page 308 of 625
KOSMONT COMPANIES | 5
SUMMARY OF FINDINGS (CONTINUED)
•Kosmont estimates that a likely future AASP land use development scenario would include a mix of uses,
including both “vertically” blended uses (e.g., housing over commercial), as well as “horizontally” blended
uses (e.g., commercial or hospitality behind or adjacent to housing).
•Kosmont’s estimation of a potential market-based, blended-use land use scenario was primarily based on a
combination of demonstrated developer interest within the City, Kosmont previous market supply and
demand analysis in the region, and broader real estate development trends across the State and nationally.
•Assumptions also reflect proposed and approved projects within the AASP, such as approved hotels (~218
rooms) and remaining residential units within Avila Ranch.
Page 309 of 625
KOSMONT COMPANIES | 6
EXAMPLE AASP LAND USE
AND FISCAL IMPACT SCENARIOS
Land Use Assumptions
LUCE 2014
Land Use
Market-Based
Blended Use
Residential - Market Rate 0 DU 2,650 DU
Affordable Housing 0 DU 230 DU
Hotel 0 rooms 218 rooms
Office 900,000 SF 30,000 SF
Commercial / Retail 616,983 SF 158,976 SF
Industrial 747,642 SF 95,000 SF
City of San Luis Obispo Fiscal Impacts
LUCE 2014
Land Use
Market-Based
Blended Use
Estimated Fiscal Revenues $5,352,100 $5,558,400
Estimated Fiscal Expenditures $2,146,800 $7,273,200
Estimated Net Fiscal Impact to City $3,205,300 ($1,714,800)
Page 310 of 625
KOSMONT COMPANIES | 7
FISCAL MITIGATION STRATEGIES
•In order to support long-term fiscal solvency for the City General Fund while not over-prescribing non-
residential uses beyond market and financial feasibility, and while not relying solely on future non-
residential uses which are difficult to predict, Kosmont suggests a fiscal mitigation strategy, including one
or more of the following components:
1. Maintenance / services Community Facilities District (“CFD”), similar to the mechanism utilized for
the Avila Ranch development project within the City (potentially most feasible strategy)
2. Renegotiation of the Property Tax Sharing Agreement with the County
3. Infrastructure Financing District negotiation with the County (as a backup to #2 above)
4. Minimum commercial use requirements for residential projects
•While Strategy #1 above (maintenance CFD) may be the most feasible to implement, advantages and
disadvantages of each strategy listed above are discussed on the following pages.
Page 311 of 625
KOSMONT COMPANIES | 8
1) MAINTENANCE / SERVICES CFD
•A CFD could be employed instead or in addition to other fiscal mitigation options, such as renegotiation
of the Property Tax Sharing Agreement or imposing commercial use requirements.
•Kosmont estimates that the range of CFD special tax required to achieve “fiscal neutrality” within a likely
future AASP land use development scenario ($600-$1,000 per residential unit per year) is within
acceptable ranges for the residential real estate market, consistent with CFD implementation elsewhere in
the State, and generally consistent with the existing Avila Ranch CFD within the City.
•Maintenance CFDs require 2/3 voter approval, and are sometimes arranged to be “annexable” in nature,
such that certain types of projects (e.g., residential or blended use) are conditioned to approve annexation
into the maintenance CFD.
Page 312 of 625
KOSMONT COMPANIES | 9
2) RENEGOTIATION OF THE PROPERTY TAX SHARING
AGREEMENT WITH THE COUNTY
•The City may be able to renegotiate the property tax sharing agreement with the County as it pertains to
certain types of development (e.g., residential), given the local, regional, and statewide policy pressures to
produce more housing.
•Approval of a revised sharing agreement would of course require approval by both the City and County,
hence a lessened certainty of implementation compared to a maintenance CFD. The County would need
to be motivated to renegotiate the existing agreement, which is anticipated to be difficult.
•Renegotiation of the tax sharing agreement could be done instead or in addition to a maintenance CFD
and/or minimum commercial use requirement.
Page 313 of 625
KOSMONT COMPANIES | 10
3) INFRASTRUCTURE FINANCING DISTRICT NEGOTIATION
WITH THE COUNTY
•Suggested only as a backup alternative to strategy #2 (renegotiation of tax sharing agreement), the City
and County may both consider formation of a tax increment financing (TIF) district such as an Enhanced
Infrastructure Financing District (EIFD).
•An EIFD would not create a new tax to property owners, but would entail the County allocating some
portion of its future property tax within the AASP area for a prescribed period of time (e.g., 10 to 50
years), with a restriction for certain eligible uses, such as infrastructure and affordable housing.
•An EIFD would not require voter approval, although property owners and residents within the financing
district boundary (e.g., AASP area) would have an opportunity to protest formation of the EIFD.
•EIFD formation could be done instead or in addition to a maintenance CFD and/or minimum commercial
use requirement.
Page 314 of 625
KOSMONT COMPANIES | 11
4) MINIMUM COMMERCIAL USE REQUIREMENTS FOR
RESIDENTIAL PROJECTS
•Instead or in addition to other fiscal mitigation options listed herein, the City could adopt a minimum
commercial use requirement for residential projects within the AASP, such as a certain amount of
commercial square footage.
•Advantages of this approach include direct promotion of land use mixes that include greater proportions
of non-residential uses. This approach would more directly reserve a greater amount of developable land
in the AASP area for commercial and manufacturing uses and promote jobs/housing balance.
•Disadvantages of this approach include the potential to limit any new development in the AASP area, as
the required amount of non-residential components may render new development projects financially
infeasible, and thus unable to proceed at all.
•This approach does not fully acknowledge current trends of “horizontal” blending of land uses versus
“vertical” blending of land uses. While each individual residential development may not contain a significant
non-residential component, the production of new “rooftops” within an area is still critical to support
development of new non-residential uses (and retention of existing non-residential uses) on other parcels.
Page 315 of 625
KOSMONT COMPANIES | 12
POTENTIAL NEXT STEPS
•Subject to City staff and City Council discussion and direction regarding land use and economic
development objectives for the AASP area, the City may proceed with one or more of the fiscal mitigation
strategies suggested herein.
•Kosmont is suggesting that Strategy #1 (maintenance CFD) may make sense to be prioritized based on
realistic implementation feasibility. Kosmont suggests that Strategy #2 (renegotiation of sharing agreement)
is worth at least an initial inquiry with County stakeholders.
•Ultimately, certain strategies may be implemented on a targeted basis, such as within the AASP area alone,
or Citywide (e.g., Citywide maintenance CFD), as has been implemented elsewhere within the State.
•Kosmont suggests transparent communication with both public sector and private sector stakeholders in
any scenario.
Page 316 of 625
KOSMONT COMPANIES | 13
APPENDIX:
FISCAL IMPACT ANALYSIS SCENARIO DETAIL
Page 317 of 625
Airport Area Specific Plan - Fiscal Impact Analysis
Overview of Fiscal Impacts
LUCE 2014
Market-Based
Blended Use
City of San Luis Obispo
Estimated Fiscal Revenues $5,352,100 $5,558,400
Estimated Fiscal Expenditures $2,146,800 $7,273,200
Estimated Net Fiscal Impact to City $3,205,300 ($1,714,800)
Land Use Assumptions for Reference LUCE 2014
Market-Based
Blended Use
Residential - Market Rate 0 DU 2,650 DU
Affordable Housing 0 DU 230 DU
Hotel 0 rooms 218 rooms
Office 900,000 SF 30,000 SF
Commercial / Retail 616,983 SF 158,976 SF
Industrial 747,642 SF 95,000 SF
Notes:
Impacts at buildout
Assumes installation of necessary public infrastructure
Values in 2024 dollars
8/13/2024 Page 1 of 13
Page 318 of 625
Airport Area Specific Plan - Fiscal Impact Analysis
Summary of Estimated Fiscal Impacts to City
LUCE 2014
Market-Based
Blended Use
City of San Luis Obispo General Fund Revenues
Property Tax $0 $0
Property Tax In-Lieu of MVLF $359,300 $785,800
Property Transfer Tax $18,500 $40,500
Sales Tax - General - Direct $1,388,200 $357,700
Sales Tax - Measure G20 - Direct $2,082,300 $536,500
Use Tax as % of Sales Tax - Direct $200,600 $51,700
Sales Tax - Prop 172 as % of Sales Tax - Direct $30,500 $7,900
Sales Tax - General - Indirect $128,700 $425,800
Sales Tax - Measure G20 - Indirect $193,100 $638,700
Use Tax as % of Sales Tax - Indirect $18,600 $61,500
Sales Tax - Prop 172 as % of Sales Tax - Indirect $2,800 $9,400
Transient Occupancy Tax $0 $946,900
Utility Users Tax $184,000 $559,600
Franchise Fees $59,700 $181,700
Business Tax $473,500 $81,500
Cannabis Tax $45,400 $138,000
Police Revenue $19,100 $58,200
Fire Revenue $49,400 $150,100
Parks & Rec Revenue $0 $260,600
Business Licenses $66,800 $11,500
Other Revenue $31,600 $96,100
SB1 Road Repair $0 $158,700
Estimated Total Revenues $5,352,100 $5,558,400
City of San Luis Obispo General Fund Expenditures
Administration and IT $137,700 $418,800
City Attorney $18,700 $57,000
Finance & Non-Departmental $65,300 $198,500
Human Resources $28,100 $85,500
Fire $486,600 $1,480,100
Police $707,200 $2,151,100
Community Services Group Admin $12,200 $37,000
Community Development $60,200 $183,100
Parks and Recreation $0 $743,300
Public Works $573,400 $1,744,000
Solid Waste $10,900 $33,300
Transfers Out $46,500 $141,500
Estimated Total Expenditures $2,146,800 $7,273,200
Estimated Annual Net Fiscal Impact $3,205,300 ($1,714,800)
Revenue / Cost Ratio 2.49 0.76
Notes:
Assumes installation of necessary public infrastructure
Values in 2024 dollars
8/13/2024 Page 2 of 13
Page 319 of 625
Airport Area Specific Plan - Fiscal Impact Analysis
Project Description
Project Component LUCE 2014
Market-Based
Blended Use
Residential - Market Rate 2,650 DU
Affordable Housing 230 DU
Hotel 218 rooms
Office 900,000 SF 30,000 SF
Commercial / Retail 616,983 SF 158,976 SF
Industrial 747,642 SF 95,000 SF
Annual Escalation Factor 1.00 1.00
Estimated A/V - Residential $495K Per Unit $0 $1,311,552,000
Estimated A/V - Affordable Housing $0K Per Unit $0 $0
Estimated A/V - Hotel $350K Per Room $0 $76,300,000
Estimated A/V - Office $350 PSF $315,000,000 $10,500,000
Estimated A/V - Commercial / Retail $350 PSF $215,944,050 $55,641,600
Estimated A/V - Industrial $190 PSF $142,051,980 $18,050,000
Total Estimated Assessed Value $672,996,030 $1,472,043,600
Notes:
Values in 2024 dollars
8/13/2024 Page 3 of 13
Page 320 of 625
Airport Area Specific Plan - Fiscal Impact Analysis
Project Employment and Occupants
Project Component LUCE 2014
Market-Based
Blended Use
Residential - Market Rate 0 DU 2,650 DU
Affordable Housing 0DU 230DU
Hotel 0 Rooms 218 Rooms
Office 900,000 SF 30,000 SF
Commercial / Retail 616,983 SF 158,976 SF
Industrial 747,642 SF 95,000 SF
Estimated # Employees (FTE)
Residential - Market Rate 50 DU / emp 053
Affordable Housing 50 DU / emp 05
Hotel 1.5 room / emp 0 145
Office 400 SF / emp 2,250 75
Commercial / Retail 400 SF / emp 1,542 397
Industrial 1,500 SF / emp 498 63
Total Estimated # Employees (FTE) 4,291 739
Occupied Dwelling Units 93%0DU 2,678DU
Residents 2.29 per DU 0 6,134
Occupied Hotel Rooms 70%0 rooms 153 rooms
Hotel Guests 1.5 per room 0 229
Employees Weighted at 50%50%2,145 369
Hotel Guests Weighted at 10%10%023
Total Service Population (Residents / Empl / Visitors) 2,145 6,526
Notes:
Average household size reflects City average household size
Values in 2024 dollars
8/13/2024 Page 4 of 13
Page 321 of 625
Airport Area Specific Plan - Fiscal Impact Analysis
Property Tax
LUCE 2014
Market-Based
Blended Use
Estimated Assessed Value - Residential $0 $1,311,552,000
Estimated Assessed Value - Non-Residential $672,996,030 $160,491,600
Total Estimated Assessed Value $672,996,030 $1,472,043,600
Total Secured Property Tax General Levy 1.00%$6,729,960 $14,720,436
Estimated Unsecured Property Tax as % of Secured Non-Residential Value 10.00%$672,996 $160,492
Total Estimated Secured + Unsecured Property Tax $7,402,956 $14,880,928
Distributions to Taxing Entities
Property Tax - City of San Luis Obispo (based on Property Tax Sharing Agreement)0.00%$0 $0
Net Property Tax to City 0.00%$0 $0
Notes:
When the proposed project site was annexed into the City of San Luis Obispo, it carried a nonresidential land use designation (M - Manufacturing). Under the terms of the
tax sharing agreement between the City and the County of San Luis Obispo, the County continues to receive all base year taxes plus any future incremental increase in property
taxes for property designated for nonresidential development. Therefore, under the agreement, the City will not receive a share of general levy property taxes from the AASP area.
Does not include property tax overrides above 1% general levy
Values in 2024 dollars
Source: San Luis Obispo County Auditor-Controller (2024)
8/13/2024 Page 5 of 13
Page 322 of 625
Airport Area Specific Plan - Fiscal Impact Analysis
Property Tax In-Lieu of Motor Vehicle License Fees (MVLF)
Total AV within CITY $11,770,822,169
Current Property Tax In-Lieu of MVLF $6,283,397
Prop Tax In-Lieu of MVLF per $1M of AV $534
LUCE 2014
Market-Based
Blended Use
Estimated Project Assessed Value $672,996,030 $1,472,043,600
Net Incremental Property Tax In-Lieu of MVLF to City $359,300 $785,800
Notes:
Values in 2024 dollars
Source: San Luis Obispo County Auditor-Controller, City Online Budget Portal (2024)
8/13/2024 Page 6 of 13
Page 323 of 625
Airport Area Specific Plan - Fiscal Impact Analysis
Property Transfer Tax
LUCE 2014
Market-Based
Blended Use
Estimated Assessed Value - For-Sale Residential $0 $0
Estimated Property Turnover Rate 15.0% 15.0%
Estimated Value of Property Transferred $0 $0
Estimated Assessed Value - Other Land Uses $672,996,030 $1,472,043,600
Estimated Property Turnover Rate 5.0% 5.0%
Estimated Value of Property Transferred $33,649,802 $73,602,180
Estimated Total Value of Property Transferred $33,649,802 $73,602,180
Total Transfer Tax $1.10 per $1,000 $37,000 $81,000
Transfer Tax to City $0.55 per $1,000 $18,500 $40,500
Notes:
Values in 2024 dollars
Source: San Luis Obispo County Auditor-Controller (2024)
8/13/2024 Page 7 of 13
Page 324 of 625
Airport Area Specific Plan - Fiscal Impact Analysis
Sales Tax - Direct / On-Site
Project Component LUCE 2014
Market-Based
Blended Use
Commercial / Retail 616,983 SF 158,976 SF
Portion of Comm / Retail Generating Local Taxable Sales 75%462,737 SF 119,232 SF
Estimated Taxable Sales $300 PSF $138,821,175 $35,769,600
Sales Tax - General - Direct 1.00%$1,388,200 $357,700
Sales Tax - Measure G20 - Direct 1.50%$2,082,300 $536,500
Use Tax as % of Sales Tax - Direct 14.45%$200,600 $51,700
Sales Tax - Prop 172 as % of Sales Tax - Direct 2.20%$30,500 $7,900
Notes:
Use tax and Prop 172 sales tax percentages based on historical average percentages
Values in 2024 dollars.
8/13/2024 Page 8 of 13
Page 325 of 625
Airport Area Specific Plan - Fiscal Impact Analysis
Sales Tax - Indirect / Off-Site
LUCE 2014
Market-Based
Blended Use
Estimated # Employees 4,291 739
Estimated Annual Taxable Retail Spending / Empl. Near Work $6,000 $6,000
Estimated Employee Taxable Retail Spending Within City $25,745,313 $4,432,240
Estimated # Occupied Dwelling Units 0 DU 2,678 DU
Estimated Avg Annual Taxable Retail Spending / HH $30,977 $30,977
Estimated Resident Taxable Retail Spending $0 $82,970,125
Estimated Capture within City 50.0%$0 $41,485,063
Estimated # Occupied Hotel Rooms 0 rooms 153 rooms
Estimated Annual Taxable Retail Spending / Room $18,250 $18,250
Estimated Resident Taxable Retail Spending $0 $2,784,950
Estimated Capture within City 50.0%$0 $1,392,475
Total Estimated Indirect Taxable Sales $25,745,313 $47,309,778
Estimated Capture Within AASP Retail - Percentage (50%) (10%)
Estimated Capture Within AASP Retail - Dollar Amount ($12,872,657) ($4,730,978)
Net Indirect Taxable Sales $12,872,657 $42,578,800
Sales Tax - General - Indirect 1.00%$128,700 $425,800
Sales Tax - Measure G20 - Indirect 1.50%$193,100 $638,700
Use Tax as % of Sales Tax - Indirect 14.45%$18,600 $61,500
Sales Tax - Prop 172 as % of Sales Tax - Indirect 2.20%$2,800 $9,400
Notes:
Employee spending estimates based on "Office Worker Retail Spending Patterns: A Downtown and Suburban Area Study," ICSC.
Household spending based on average houshold income within City.
Hotel guest spending estimated based on American Hotel and Lodging Association (AHLA) data.
Values in 2024 dollars.
8/13/2024 Page 9 of 13
Page 326 of 625
Airport Area Specific Plan - Fiscal Impact Analysis
Transient Occupancy Tax ("TOT")
LUCE 2014
Market-Based
Blended Use
Estimated # Hotel Rooms 0 rooms 218 rooms
Average Daily Room Rate (ADR)$170 $170
Average Occupancy Rate 70% 70%
Annual Hotel Room Receipts $0 $9,468,830
TOT to City 10.0%$0 $946,900
Notes:
Values in 2024 dollars.
8/13/2024 Page 10 of 13
Page 327 of 625
Airport Area Specific Plan - Fiscal Impact Analysis
City Service Population
City Population 48,684
City Employee Population 30,061
Employee Weighting for Service Population 0.5
Weighted # Employees 15,031
Visitor Population Equiv - Weighted at 10% of Resident 4,868
Total City Service Population 68,583
Source: CA Department of Finance, U.S. Census Bureau Center for Economic Studies (2023-2024)
8/13/2024 Page 11 of 13
Page 328 of 625
Airport Area Specific Plan - Fiscal Impact Analysis
City Multipler Revenue and Expenditure Factors
Budget Category
Adopted City
Budget Allocation Basis
Relevant City
Population
Percent Fixed
Costs
Per Capita
Factor
General Fund Revenues
Sales Tax - General $23,166,049 N/A - Estimated Separately via Case Study Method -----------------------------
Sales Tax - Prop 172 $508,968 N/A - Estimated Separately via Case Study Method -----------------------------
Sales Tax - Local Revenue Measure $30,897,602 N/A - Estimated Separately via Case Study Method -----------------------------
Property Tax $15,982,628 N/A - Estimated Separately via Case Study Method -----------------------------
Property Tax in Lieu of MVLF $6,669,367 N/A - Estimated Separately via Case Study Method -----------------------------
Transient Occupancy Tax $10,918,080 N/A - Estimated Separately via Case Study Method -----------------------------
Utility Users Tax $5,881,630 Service Population 68,583 0%$85.76
Franchise Fees $1,910,000 Service Population 68,583 0%$27.85
Business Tax $3,317,338 Employment Base 30,061 0%$110.35
Cannabis Tax $1,450,000 Service Population 68,583 0%$21.14
Police Revenue $611,917 Service Population 68,583 0%$8.92
Fire Revenue $1,577,836 Service Population 68,583 0%$23.01
Development Review $6,585,331 N/A - Non-Recurring Revenue ------------------------------------------------------------
Parks & Rec Revenue $2,068,693 Residents 48,684 0%$42.49
Business Licenses $468,000 Employment Base 30,061 0%$15.57
Cannabis Fee Revenue $232,600 N/A - Prior Obligations ----------------------------------------------------------------------
Other Revenue $1,010,016 Service Population 68,583 0%$14.73
SB1 Road Repair $1,259,276 Residents 48,684 0%$25.87
Grants and Subventions $682,279 N/A - Non-Recurring Revenue ------------------------------------------------------------
Storm Reimbursement $4,208,000 N/A - Non-Recurring Revenue ------------------------------------------------------------
Total General Fund Revenues $119,405,610
General Fund Expenditures
Administration and IT $11,003,659 Service Population 68,583 60%$64.18
City Attorney $1,497,103 Service Population 68,583 60%$8.73
Finance & Non-Departmental $5,216,654 Service Population 68,583 60%$30.43
Human Resources $2,246,535 Service Population 68,583 60%$13.10
Fire $15,554,762 Service Population 68,583 0%$226.80
Police $22,607,072 Service Population 68,583 0%$329.63
Community Services Group Admin $778,730 Service Population 68,583 50%$5.68
Community Development $8,510,146 Service Population 68,583 77%$28.07
Parks and Recreation $5,899,998 Residents 48,684 0%$121.19
Public Works $18,328,375 Service Population 68,583 0%$267.24
Solid Waste $349,657 Service Population 68,583 0%$5.10
Debt Service $1,769,000 N/A - Prior Obligations ----------------------------------------------------------------------
Capital $27,269,000 N/A - Non-Recurring --------------------------------------------------------------------------
Transfers Out $1,487,000 Service Population 68,583 0%$21.68
Total General Fund Expenditures $122,517,691
Notes:
Community Development adustments based on services paid by Development Review Fees (also deducted from Revenues)
Values in 2024 dollars.
Source: City of San Luis Obispo 2023-2025 Financial Plan (2024-2025 Budget)
8/13/2024 Page 12 of 13
Page 329 of 625
Airport Area Specific Plan - Fiscal Impact Analysis
City Multipler Revenues and Expenditures
LUCE 2014
Market-Based
Blended Use
Estimated # Residents 0 6,134
Estimated # Employees 4,291 739
Estimated # Visitors 0 229
Total Project Service Population 2,145 6,526
Budget Category LUCE 2014
Market-Based
Blended Use
General Fund Revenues
Utility Users Tax $184,000 $559,600
Franchise Fees $59,700 $181,700
Business Tax $473,500 $81,500
Cannabis Tax $45,400 $138,000
Police Revenue $19,100 $58,200
Fire Revenue $49,400 $150,100
Development Review N/A N/A
Parks & Rec Revenue $0 $260,600
Business Licenses $66,800 $11,500
Cannabis Fee Revenue N/A N/A
Other Revenue $31,600 $96,100
SB1 Road Repair $0 $158,700
Grants and Subventions N/A N/A
Storm Reimbursement N/A N/A
Total Multiplier Revenues $929,500 $1,696,000
General Fund Expenditures
Administration and IT $137,700 $418,800
City Attorney $18,700 $57,000
Finance & Non-Departmental $65,300 $198,500
Human Resources $28,100 $85,500
Fire $486,600 $1,480,100
Police $707,200 $2,151,100
Community Services Group Admin $12,200 $37,000
Community Development $60,200 $183,100
Parks and Recreation $0 $743,300
Public Works $573,400 $1,744,000
Solid Waste $10,900 $33,300
Debt Service N/A N/A
Capital N/A N/A
Transfers Out $46,500 $141,500
Total Multiplier Expenditures $2,146,800 $7,273,200
Notes:
Major case study revenues not shown include property tax, sales tax, transient occupancy tax
Values in 2024 dollars.
Source: City of San Luis Obispo 2023-2025 Financial Plan (2024-2025 Budget)
8/13/2024 Page 13 of 13
Page 330 of 625
SAN LUIS OBISPO COUNTY
AIRPORT LAND USE COMMISSION
Michael Cripe
Tim O’Keffee
Xandrea Fowler
Adam Verdin
Allen Settle
Erich Schaefer
Marc Dart
County of San Luis Obispo ▪ 976 Osos St., Rm 300 ▪ San Luis Obispo California 93408 ▪ (805) 781-5600
Email: planning@co.slo.ca.us ▪ Fax (805) 781-1242 ▪ Website: http://www.slocounty.ca.gov/Planning
February 24, 2025
NOTICE OF AIRPORT LAND USE COMMISSION ACTION
HEARING DATE: February 19, 2025
RECOMMENDATION TO: City of San Luis Obispo
1) SUBJECT: Hearing to consider a mandatory referral by the City of San Luis Obispo (CITY)
for a determination of consistency with the Airport Land Use Plan (ALUP) for the San Luis
Obispo County Regional Airport (AIRPORT) for a proposed amendment to the City’s Airport
Area Specific Plan (AASP).
Agency: City of San Luis Obispo
Project Manager: John Rickenbach
Recommendation: Consistent with the ALUP subject to conditions of consistency
On February 19, 2025, the Airport Land Use Commission determined the above referenced
project Consistent with the San Luis Obispo County Regional Airport, Airport Land Use Plan
and referred it back to the City of San Luis Obispo, subject to the attached conditions of
consistency.
If you have any questions regarding this matter, please contact me at (805) 781-1006 or
yeighmy@co.slo.ca.us
Sincerely,
Ysabel Eighmy
Ysabel Eighmy, Secretary
Airport Land Use Commission
Page 331 of 625
FINDINGS AND CONDITIONS OF CONSISTENCY
CITY OF SLO AASP AMENDMENT
ALUC FEBRUARY 19, 2025
FINDINGS
1. The Amendments are consistent with General Land Use Policies G-1 through G-4
because: all information required for review of the Amendments was provided by the
City; the Amendments (as conditioned) would not result in any incompatibilities to
the continued economic vitality and efficient operation of the Airport with respect to
safety, noise, overflight or obstacle clearance; and since some of the lots affected by
the Amendments are located in more than one noise exposure area or Aviation Safety
Zone, the standards for each such area will be applied separately to the land area
lying within each noise counter or safety area unless the project is specifically
reviewed by the ALUC and it elects at its sole discretion not to apply the requirements
of the more restrictive zone in accordance with Policy G-4 of the ALUP;
2. The Amendments are consistent with the Noise Compatibility Policies N-1 through N-
5 because the area affected by the Amendments is located outside the 60 dB CNEL
contour and development of any extremely or moderately noise-sensitive uses are
allowable and shall meet the requirements of interior noise levels specified in Table
4-1 and Section 4.3.3 of the ALUP;
3. The Amendments are consistent with the Safety Compatibility Policies S-1 through S3
because the Amendments only modify allowable uses within Safety Zone 6 and would
not result in a density greater than that specified in Table 4-2; the Amendments would
not result in a greater building coverage than permitted by Table 4-3; and the
Amendments would not result in land uses other than specified in Table 4-5;
4. The Amendments are consistent with the Airspace Protection Policies A-1 through A-
4 because the Amendments (as conditioned), existing City regulations, and distance
from the Airport will ensure no structure, landscaping, apparatus, or other feature
will create an obstruction or hazard to air navigation, do not propose new landfill or
other disposal site, will ensure no structure, landscaping, apparatus, or other feature
will create a wildlife attractant, and does not propose the creation of new or restored
wetlands;
Page 332 of 625
5. The Amendments are consistent with the Overflight Protection Policies O-1 through
O-2 because the Amendments have been conditioned to require avigation easements
be recorded for each property developed within the Project site prior to the issuance
of any building permit or land use permit; and all owners, potential purchasers,
occupants (whether as owners or renters), and potential occupants (whether as
owners or renters) to receive full and accurate disclosure concerning the noise, safety,
or overflight impacts associated with Airport operations prior to entering any
contractual obligation to purchase, lease, rent, or otherwise occupy any property or
properties within the Airport Area;
CONDITIONS
1. The City shall ensure that all applicable ALUP policies and aviation related
development restrictions are enforced.
2. Utilizing the ALUP’s California Building Code (CBC) calculation method (Figure 4-3), the
Amendments shall limit mixed use density/ intensity for applicable property within
the AASP planning area designated C-S and M as follows:
a. The maximum average density/ intensity shall be 300 persons per gross acre
(average across entire site); and
b. The maximum single acre density shall be 1,200 persons per gross acre
(maximum on any single acre).
3. The construction plans for proposed mixed use development that include structures
or other objects that exceed the height standards defined in Title 14 of the Code of
Federal Regulations (CFR) Part 77 as applied to the Airport, shall be submitted via FAA
Form 7460-1 to the Air Traffic Division of the FAA regional office having jurisdiction
over San Luis Obispo County at least 45 days before proposed construction or
application for a building permit, to determine compliance with the provisions of FAR
Part 77.
4. All future mixed-use development shall comply with all noise policies as required by
the ALUP.
5. No structure, landscaping, apparatus, or other feature, whether temporary or
permanent in nature shall constitute an obstruction to air navigation or a hazard to
air navigation, as defined by the ALUP.
Page 333 of 625
6. Any use is prohibited that may entail characteristics which would potentially interfere
with the takeoff, landing, or maneuvering of aircraft at the Airport, including:
• creation of electrical interference with navigation signals or radio communication
between the aircraft and airport;
• lighting which is difficult to distinguish from airport lighting;
• glare in the eyes of pilots using the airport;
• uses which attract birds and create bird strike hazards;
• uses which produce visually significant quantities of smoke; and
• uses which entail a risk of physical injury to operators or passengers of aircraft
(e.g., exterior laser light demonstrations or shows).
7. Avigation easements shall be recorded for each property developed within the Project
site prior to the issuance of any building permit or land use permit.
8. All owners, potential purchasers, occupants (whether as owners or renters), and
potential occupants (whether as owners or renters) shall receive full and accurate
disclosure concerning the noise, safety, or overflight impacts associated with Airport
operations prior to entering any contractual obligation to purchase, lease, rent, or
otherwise occupy any property or properties within the Airport area.
9. Any residential portion of a mixed-use development within the C-S and M land use
designation within the AASP shall be located wholly within Safety Zone 6.
Page 334 of 625
1
Addendum to the Final Programmatic Environmental Impact Report for the
Airport Area and Margarita Area Specific Plans and Related Facilities
Master Plans
1. Project Title:
Airport Area Specific Plan Amendment to Allow Mixed-Use Development in the Service
Commercial (C-S) and Manufacturing (M) zones subject to the approval of a conditional
use permit
2. Lead Agency Name and Address:
City of San Luis Obispo
990 Palm Street
San Luis Obispo, CA 93401
3. Contact Person and Phone Number:
Rachel Cohen, Principal Planner
805-781-7574
4. Project Location:
Airport Area Specific Plan area, generally bounded by South Higuera Street to the west,
Meissner Lane to the north, Broad Street to the east, and Buckley Road to the south, in
San Luis Obispo, CA
5. Project Applicant and Representative Name and address:
City of San Luis Obispo
Community Development Department
919 Palm Street
San Luis Obispo, CA 93401
6. General Plan Designation:
Services & Manufacturing
7. Zoning:
Service Commercial (C-S) and Manufacturing (M)
Page 335 of 625
2
8. Description of the Project:
The Airport Area Specific Plan (AASP) is a land use program with policies, goals,
guidelines and infrastructure financing strategies to guide future development to ensure
land use compatibility within the AASP planning area. The AASP was adopted in 2005
and has been amended several times since then in response to changing conditions or
opportunities unforeseen at the time of its adoption. The proposed project would amend
the AASP to allow for mixed-use development (as defined in the City’s Municipal Code)
with a conditional use permit within parcels designated as either Service Commercial (C-
S) or Manufacturing (M).
The AASP does not currently allow mixed-use development. The underlying reason for
this was because of the area’s proximity to the San Luis Obispo County Airport, and the
established safety and noise areas that limited or prohibited noise sensitive residential
uses or high density residential development. The southern portion of the City at that time
was also viewed as the area most appropriate for industrial uses. In 2021, the San Luis
Obispo County Airport Land Use Commission (ALUC) amended and restated the Airport
Land Use Plan (ALUP) to address new technical information related to safety and noise,
which resulted in a refinement of areas subject to land use restrictions under the ALUP,
including areas within the AASP. As a result, there is now substantial area within the AASP
where the land use restrictions have changed related to airport safety and noise, and
creates opportunities for mixed-use developments.
No development would occur directly as a result of this action, which is simply a
modification of existing land use requirements under the AASP. Future development
under the modified land use requirements could occur as a result of individual project
applications that must be approved by the City of San Luis Obispo through its normal
development and conditional use permit review processes. However, the magnitude and
timing of such development is speculative at this time, and would be influenced by a
variety of issues, including market demand, property owner desire to develop,
consistency with the ALUP, and potential environmental constraints that may apply to
specific parcels where project development applications are under consideration.
The Project Area includes all parcels designated as Service Commercial (C-S) or
Manufacturing (M) within the 1,200-acre AASP planning area. Figure 1 shows the location
of C-S and M designated parcels within the AASP.
9. Project Entitlements Requested:
No project-level entitlements are requested or would occur as a result of this action.
Instead, the resulting amendment would allow mixed-use development, subject to specific
findings, with a conditional use permit in portions of the Airport Area Specific Plan
currently designated as Service Commercial (C-S) and Manufacturing (M), consistent with
the requirements of the City’s Zoning Regulations, as they currently apply to C-S and M
Page 336 of 625
3
designated lands in the remainder of the City. The reason this amendment is necessary
is because as currently written, the AASP does not allow mixed-use development.
Figure 1: Existing Land Use Designations in the Airport Area Specific Plan
Development under the modified land use requirements would result from individual
project applications that must be approved by the City of San Luis Obispo through its
normal development and conditional use permit review processes. Proposed
modifications to the Airport Area Specific Plan are described below in detail under the
heading “New Information and Updated Project Elements.”
10. Previous Environmental Review:
The Final Programmatic EIR for the Airport Area and Margarita Area Specific Plans and
Related Facilities Master Plans (“Final EIR”, or “AASP Final EIR”) addressed future
development within the Airport Area Specific Plan. The Final EIR was certified in
September 2003, and has provided the basis for evaluating the impacts of future
development within the AASP area. Subsequent amendments to the AASP were subject
to separate CEQA evaluations to address the potential impacts stemming from those
amendments. In a similar manner, the analysis in this Addendum tiers from the original
Final EIR.
Page 337 of 625
4
Individual projects that may be proposed under the AASP as amended would be subject
to review under the California Environmental Quality Act (CEQA) as appropriate on a
project-by-project basis.
The County of San Luis Obispo Airport Land Use Commission conducted an Initial Study
and prepared a Negative Declaration for the 2021 update of its Airport Land Use Plan
(ALUP) (SCH: 2021030474). That environmental document was used to inform the
conclusions contained in this addendum.
11. Purpose of the Addendum:
Section 15164 of the State CEQA Guidelines allows a lead agency to prepare an
addendum to a Final EIR when only “minor technical changes or additions” are necessary
to address the effects of a minor change to the approved project since the Final EIR was
certified. In addition, the lead agency is required to explain its decision not to prepare a
subsequent EIR pursuant to State CEQA Guidelines Section 15162, which requires
subsequent EIRs when proposed changes would require major revisions to the previous
EIR “due to the involvement of new significant environmental effects or a substantial
increase in the severity of previously identified significant effects.”
Subsequent to certification of the AASP Final EIR, additional information has been
identified which provides a more consistent Citywide approach to mixed-use
development, specifically as it is allowed in the C-S and M zones. In 2021, the San Luis
Obispo County Airport Land Use Commission (ALUC) updated its Airport Land Use Plan
(ALUP) to address new technical information related to safety and noise, which resulted
in a refinement of areas subject to land use restrictions under the ALUP and has created
opportunities for mixed-use developments within the AASP. The proposed action requires
an amendment to the AASP to allow for mixed-use in the C-S and M zones subject to a
Conditional Use Permit. This project is described in more detail in subsequent sections of
this EIR Addendum.
The purpose of this Addendum is to document the proposed change to the AASP, and to
confirm that this change would not result in any new or more severe significant
environmental effects not previously analyzed in the Final EIR, and would not modify any
existing mitigation requirements described in that document.
The evaluation below discusses the issue areas that are relevant to this Addendum and
covered by the previously approved Final EIR. The evaluation concludes that no new
environmental effects are created and that there is no increase in the severity of
previously identified significant effects.
Page 338 of 625
5
12. Addendum Requirements:
Pursuant to Section 21166 of CEQA and Section 15162 of the State CEQA Guidelines,
when a lead agency has adopted an EIR for a project, a subsequent EIR does not need
to be prepared for the project unless the lead agency determines that one or more of the
following conditions are met:
1. Substantial project changes are proposed that will require major revisions of the
previous EIR due to the involvement of new significant environmental effects or a
substantial increase in the severity of previously identified significant effects;
2. Substantial changes would occur with respect to the circumstances under which the
project is undertaken that require major revisions to the previous EIR due to the
involvement of new significant environmental effects or a substantial increase in the
severity of previously identified significant effects; or
3. New information of substantial importance that was not known and could not have
been known with the exercise of reasonable diligence at the time the previous EIR
was adopted shows any of the following:
a. The project will have one or more significant effects not discussed in the
previous EIR; or
b. Significant effects previously examined will be substantially more severe than
identified in the previous EIR; or
c. Mitigation measures or alternatives previously found not to be feasible would in
fact be feasible, and would substantially reduce one or more significant effects
of the project, but the project proponent declines to adopt the mitigation
measures or alternatives; or
d. Mitigation measures or alternatives that are considerably different from those
analyzed in the previous EIR would substantially reduce one or more significant
effects on the environment, but the project proponent declines to adopt the
mitigation measures or alternatives.
Preparation of an Addendum to an EIR is appropriate when none of the conditions
specified in Section 15162 (above) are present and some minor technical changes to the
previously certified EIR are necessary to address minor changes to an approved project.
Because the new information would not result in any new or more severe significant
impacts, an Addendum is the appropriate CEQA document.
Page 339 of 625
6
CURRENT REGULATORY FRAMEWORK FOR C-S AND M ZONES
San Luis Obispo County Airport Land Use Plan
Mixed-use development was not originally allowed at the time of the AASP’s adoption in 2005
because of the area’s proximity to the San Luis Obispo County Airport, and the established
safety and noise areas that limited or prohibited noise sensitive residential uses or high density
residential development. The southern portion of the City at that time was also viewed as the
area most appropriate for industrial uses. In 2021, the San Luis Obispo County Airport Land
Use Commission (ALUC) updated its Airport Land Use Plan (ALUP) to address new technical
information related to safety and noise, which resulted in a refinement of areas subject to land
use restrictions under the ALUP, including areas within the AASP. As a result, there is now
substantial area within the AASP where the land use restrictions have changed related to airport
safety and noise and creates opportunities for mixed-use developments..
Current AASP Requirements
For the reasons described above related to the ALUP, the AASP does not currently allow mixed-
use development in either the Service Commercial (C-S) or Manufacturing (M) zones. As stated
in Section 4.2.2 of the AASP, “areas designated Service Commercial are generally for storage,
transportation, and wholesaling type uses, as well as certain retail sales and business services
that may be less appropriate in other commercial designations.” Similarly, Section 4.2.3
summarizes the intent of the Manufacturing designation as areas “for assembly, fabrication,
storage and distribution, and sales and service type uses that have little or no direct trade with
local consumers.”
Table 4-3 of the AASP shows the allowed uses within each land use designation. Mixed-use is
not allowed under either designation.
Other Relevant Regulatory Setting
There is an existing regulatory framework for allowing mixed-use in non-residential zones
Citywide. Mixed-use development is allowed in the C-S and M zones in all parts of the City
except within the AASP and other specific plan areas. Within both designations, the Zoning
Regulations allow for residential development up to 24 density units per acre (Municipal Code
Sections 17.36.020 and 17.40.020).
Final Environmental Impact Report
The 2003 Final EIR examined the policy framework and conceptual development under the
AASP at a programmatic level. That document did not include project-specific analysis of the
parcels potentially impacted by the proposed action. The FEIR impact analysis was general,
and any required mitigation for key issue areas was programmatic, in consideration of cumulative
development that might occur under the AASP. Please refer to the section below entitled
“Analysis Of The Proposed Project In The Context Of The Final EIR” for further discussion of
relevant issues and how they relate to the proposed Specific Plan Amendment
Page 340 of 625
7
NEW INFORMATION AND UPDATED PROJECT ELEMENTS
NEWLY DISCOVERED INFORMATION
In recent years, the demand for housing in general, and affordable housing in particular, has
risen dramatically in San Luis Obispo, as it has elsewhere. In response, the City’s 2014 General
Plan Land Use Element update reflects this increased demand, and includes several large areas
for increased residential development, projects that have since been approved and are in the
process of being completed. At the same time, the City has tried to address these issues by
supporting mixed-use development, in areas where demand for non-residential development in
Service Commercial or Manufacturing designated land has declined. The result is that the City
allows mixed-use by right in the C-S and M zones outside the AASP. However, the AASP does
not allow mixed-use development, because of previous safety and noise restrictions included in
the ALUP. As described above, the 2021 update of the ALUP removed those restrictions that
limited or prohibited mixed-use development.
The proposed project responds to the changes in the ALUP and increased housing demand in
an evolving market by allowing for mixed-use development in the C-S and M land use
designations in the AASP with the approval of a conditional use permit.
As discussed previously, the underlying reason why mixed-use development was not allowed in
the AASP is because of the area’s proximity to the San Luis Obispo County Airport, and safety
and noise conflicts that could arise if residential development were allowed. In 2021, the San
Luis Obispo County Airport Land Use Commission (ALUC) updated its Airport Land Use Plan
(ALUP) to address new technical information related to safety and noise, which resulted in a
refinement of areas subject to land use restrictions under the ALUP, including areas within the
AASP. As a result, there is substantial area where the land use restrictions have changed related
to airport safety and noise.
CHANGED BASELINE CONDITIONS AND UPDATED PROJECT ELEMENTS
The proposed project would amend the AASP, modifying various aspects of the plan in order to
facilitate mixed-use development with approval of a conditional use permit in the C-S and M land
use designations. It would not change any existing land use designation, nor would it result in
more or less land designated as either C-S or M. Instead, it would modify existing language and
tables in various parts of the existing AASP in order to facilitate mixed-use within these land use
designations.
A detailed land use inventory was prepared in 2024 to verify the amount of C-S or M designated
lands within the planning area. Table 1 below summarizes the results of the 2024 land use
inventory for each designation, showing the total acreage of vacant and developed parcels in
these two land use designations.
Page 341 of 625
8
Table 1. Summary of 2024 Land Use Inventory
C-S and M Parcels in the AASP
Land Use Designation
Acreage
Developed (or entitled) Vacant Total
Service Commercial (C-S) 140.4 85.6 226.0
Manufacturing (M) 94.7 20.4 115.1
Total 235.1 106.0 341.1
Portions of land designated as either C-S or M are constrained from considering mixed-use
development. Some of this constrained area remains within airport land use safety zones under
the ALUP that do not allow for residential uses. Other parcels are too small or configured in such
a way to make development challenging. Depending on the location, a variety of environmental
constraints could present other challenges, including drainage features, steep slopes, or the
potential for sensitive biological or cultural resources. Some parcels are adjacent to existing
industrial land uses that produce odors or noise, which could make them less attractive for mixed-
use development. Finally, many of these parcels are already developed with other uses, or are
entitled for development. It is likely that only a few of these more constrained parcels will
eventually support mixed-use development.
There is no specific mixed-use development project proposed at this time, but the amendment
would allow the City to process and potentially approve applications that propose such
development. However, the magnitude and timing of such development cannot be known at this
time, and would be influenced by a variety of issues, including market demand, property owner
desire to develop, and potential environmental constraints that may apply to specific parcels
where project development applications are under consideration. For these reasons, it is
speculative to determine what the residential buildout potential of this action is at this time, or
how it might alter the non-residential buildout assumptions made in the AASP.
If mixed-use development were to occur, it would be based on the maximum density currently
allowed under the Zoning Regulations, which is 24 density units per acre.
ANALYSIS OF THE PROPOSED PROJECT IN THE CONTEXT OF THE FINAL EIR
The updated project elements described above were not considered in the 2003 Final EIR, and
so are analyzed here. The 2003 Final EIR examined the policy framework and conceptual
development under the AASP at a programmatic level, which is also appropriate for the currently
proposed Specific Plan Amendment. The following analysis examines the proposed project
based on relevant issues from the 2003 Final EIR, with references to FEIR impact statements
as appropriate. Implementation of the proposed project would not change any of the conclusions
in the Final EIR, the level of significance or severity of any previously identified impact, or
introduce any new mitigation measures. No changes to the Final EIR are required.
Land Use
Page 342 of 625
9
The FEIR identifies the following land use impacts that are relevant to the proposed Specific
Plan Amendment. As discussed in Impact LU-3, the Final EIR found the AASP was consistent
with the ALUP in effect at the time of adoption of the AASP. No significant impacts were
identified, and no mitigation was required. The Specific Plan amendment would allow for mixed-
use development with approval of a conditional use permit, subject to potential constraints
contained in the 2021 ALUP update. The County’s environmental document for the 2021 update
(SCH 2021030474) concluded that there would be no land use impacts or hazards associated
with allowing more intensive development in the AASP, or mixed-use or residential projects in
the ALUP area if development regulations in the ALUP were complied with. Individual
development projects within the AASP would need to be consistent with any land use restrictions
set forth in the ALUP. No new impact would occur.
Impact LU-4 discussed compatibility with surrounding land uses. No conflicts with surrounding
uses were identified in the AASP, so impacts were less than significant, and no mitigation was
required. Individual development projects within the AASP would need to be compatible with
adjacent development, a determination that would be made through development and
conditional use permit review processes and project-specific CEQA analysis for any such future
action. No new programmatic impacts would occur.
Hydrology and Water Quality
Impact H-5 discussed exposure of people and/or property to flood hazards. The FEIR found that
the conversion of land to urban uses has the potential to increase flooding hazards if new
buildings were constructed within the 100-year flood hazard area. However, the specific plan
includes explicit requirements for flood channel improvements that will avoid flooding impacts by
providing enhanced control of floodwaters. This impact was considered less than significant.
Mixed-use development would be evaluated individually under CEQA, and would be required to
comply with existing regulations related to flood hazards and water quality. No new
programmatic impacts would occur, nor would there be an increase in severity of any existing
impact.
Traffic and Circulation
Since the time the AASP FEIR was prepared, CEQA analysis related to this issue has been
modified considerably. The focus of CEQA review is now based primarily on a study of Vehicle
Miles Traveled (VMT), which can have potential impacts on regional air quality and greenhouse
gas emissions. These issues were not examined in the Final EIR.
One purpose of mixed-use development is to reduce commute distances between residences
and work places. In some cases, mixed-use development could make it possible for some
residents to walk to work, which would potentially reduce VMT. In those instances, there would
be a net positive effect on greenhouse gas emissions and air quality relative to what would
otherwise happen under the AASP. Future individual development projects within the AASP
would be evaluated on a case by case basis through a project-specific CEQA analysis. No new
programmatic impacts related to these issues would occur.
Page 343 of 625
10
Other transportation issues that were studied in the FEIR related to roadway Levels of Service
(LOS), which is a metric no longer considered in CEQA documents. Instead, these are issues
that would be appropriately addressed through the development and conditional use permit
review processes, with recommendations for potential roadway improvement made through
engineering studies.
Air Quality
The FEIR identified impacts related to both short-term construction emissions and long-term
operations emissions. Short-term construction emissions were found to be significant but
mitigable at a programmatic level, with mitigation taking the form of following a variety of
standard construction management techniques and following the existing regulatory framework
set forth by the Air Pollution Control District (APCD). The impacts of specific development
projects would be analyzed and mitigated as needed on a case by case basis.
Similarly, long-term operational impacts were also found to be less than significant with
programmatic mitigation. The FEIR included the following relevant mitigation measure:
Mitigation Measure AIR-2.1. Implement Growth-Phasing Schedule. The City will
implement a growth-phasing schedule for the Airport area, to assure that nonresidential
development in the urban area does not exceed the pace of residential development.
The consideration of mixed-use development in the Airport Area is consistent with this mitigation
requirement, as it allows for greater flexibility and opportunities to approve residential
development in balance with non-residential development. Future individual development
projects within the AASP would be evaluated on a case by case basis through a project-specific
CEQA analysis. No new programmatic impacts related to this issue would occur.
Noise
The FEIR examined relevant programmatic impacts related to traffic and aircraft noise, but found
them to be less than significant. For aircraft noise, this was because future development under
the AASP was determined to be consistent with the ALUP. For traffic noise, it was determined
that the City’s General Plan Noise Element included sufficient implementation requirements and
strategies to ensure that noise would be mitigated on a project-by-project basis as appropriate,
through the recommendations of project-specific noise studies. Future individual development
projects within the AASP would be evaluated on a case by case basis through a project-specific
CEQA analysis. The County’s environmental document for the 2021 update (SCH 2021030474)
concluded that there would be no noise impacts or hazards associated with allowing more
intensive development in the AASP, including mixed-use or residential projects in the ALUP
area, if development regulations in the ALUP were complied with. No new programmatic
impacts related to this issue would occur.
Public Services and Utilities
The FEIR examined potential programmatic impacts related to the provision of water and
wastewater services from buildout under the AASP, but concluded these would be less than
significant because projects would be required to follow the regulatory provisions included in the
Page 344 of 625
11
General Plan, AASP and relevant utilities master plans. Similarly, programmatic impacts related
to storm drainage were considered less than significant because projects would be required to
follow the provisions of the Storm Drain Master Plan. Impacts related to solid waste disposal
were also considered less than significant, as projects would be required to follow regulatory
provisions included in the General Plan and AASP.
Impacts related to law enforcement were considered less than significant, as future staffing and
facilities would be addressed through fiscal studies as needed. Impacts to fire protection
services were also considered less than significant with the following mitigation measure:
PS-1. New Fire Protection Personnel. To mitigate the impacts associated with buildout of
the [AASP], a sufficient number of fire protection personnel should be hired to maintain a
ratio of one firefighter for every 1,000 residents.
Determining the appropriate level of public services staff is typically addressed in the City’s
annual budget cycles, with recommendations resulting from studies to service impacts that are
projected to occur based on reasonably foreseeable cumulative development. The proposed
project does not facilitate any specific development project, so the magnitude of potential long-
term impacts to public services is speculative, and would be addressed on a case-by-case basis
as development projects are proposed. No new programmatic impacts related to this issue
would occur.
Impacts to schools were found to be less than significant. Mitigation is limited to the payment of
statutory fees, and no additional school-related impact fees may be imposed above the limits
established in statute (Government Code Section 65595 et seq). No new programmatic impacts
related to this issue would occur.
Impacts to parks and recreation were found to be less than significant, as buildout of the AASP
would not increase demand over the established park service standard of 10 acres per 1,000
residents. The amount of residential development that might occur under the mixed-use
provisions of the project is speculative, and would be limited by a combination of market factors,
property owner desire, lot configuration, and environmental constraints. Impacts to parks and
recreation would be considered on a case by case basis as individual development projects are
proposed. No new programmatic impacts related to this issue would occur.
Other Issues
The proposed project would not introduce new development into areas that were not already
planned for urban uses. Therefore, for all other issues related to resource protection (biological
resources, cultural resources, agricultural resources, and the exposure to hazardous materials),
the potential impact of new development would not change, so the existing impact analysis for
each issue would also remain unchanged. No new programmatic impacts related to these issues
would occur.
Page 345 of 625
12
DETERMINATION
In accordance with Section 15164 of the State CEQA Guidelines, the City of San Luis Obispo
has determined that this Addendum to the certified Final EIR is necessary to document changes
or additions that have occurred since the Final EIR was originally certified. Based on the analysis
of the proposed project, no new changes to the Final EIR are required. The proposed project
would not result in any new significant environmental effects or a substantial increase in the
severity of previously identified significant effects. Additionally, no new information of substantial
importance that was not known and could not have been known with the exercise of reasonable
diligence at the time the previous Final EIR was adopted has been identified.
The preparation of a subsequent environmental document is not necessary because:
1. None of the circumstances included in Section 15162 of the CEQA Guidelines have
occurred which require a subsequent environmental document:
a. The project changes do not result in new or substantially more severe
environmental impacts.
b. The circumstances under which the project is undertaken will not require major
changes to the IS/MND.
c. The modified project does not require any substantive changes to previously
approved mitigation measures.
2. The changes are consistent with City General Plan goals and polices that promote
provision of additional housing, particularly affordable housing, within the City.
3. The changes are consistent with City goals related to mixed-use that would encourage
alternative forms of transportation and reduce Vehicle Miles Traveled (VMT), which
relates to reducing air emissions, including greenhouse gas emissions.
The City has reviewed and considered the information contained in this Addendum and finds
that the preparation of subsequent CEQA analysis that would require public circulation is not
necessary. This Addendum does not require circulation because it does not provide significant
new information that changes the adopted Final EIR in a way that deprives the public of a
meaningful opportunity to comment upon a substantial adverse environmental effect of the
project or a feasible way to mitigate or avoid such an effect. The City shall consider this
Addendum with the certified Final EIR as part of the basis for potential approval of the proposed
Specific Plan Amendment.
Page 346 of 625
1
City Council
May 6, 2025
2
As recommended by the Planning Commission, introduce an Ordinance
entitled:
An Ordinance of the City Council of the City of San Luis Obispo, California,
amending the Airport Area Specific Plan to allow mixed-use development
in the Service Commercial (C-S) and Manufacturing (M) zones subject to a
conditional use permit where appropriate and consistent with the Airport
Area Specific Plan, including adoption of an addendum to the Final
Environmental Impact Report for the Airport Area and Margarita Area
specific plans and related facilities master plans.
3
•Major City Goal for Housing and Homelessness
•Work Program Item #3.1.c.
•Housing Element Programs:
•5.5 – Allow mixed-use development in C-S and M zones
•6.13 – Encourages mixed-use development in commercial and
manufacturing zones
•Land Use Element Policy 3.8.5 – Encourages compatible mixed uses
in commercial districts.
4
•In 2005, the AASP was adopted and provides the regulatory
framework for about 1,200 acres near the Airport.
•The AASP allowed uses and development standards that were
guided by the 2002 ALUP.
•The ALUP limited or prohibited residential and non-residential
development.
•In 2020, the City adopted the HE and included Program 5.5 that
called for updating the Zoning Regulations to allow mixed-use within
C-S and M zones without a use permit.
•Due to the existing ALUP, this same update could not be integrated
into the AASP.
5
6
•In 2021, the ALUP was updated and removed the limitation on
residential density within Safety Zone 6.
•The removal of these restrictions provided an opportunity to consider
mixed-use residential projects within the AASP.
•In the 2023-25 Financial Plan, City Council included work program
item 3.1.c. as a part of the Housing and Homelessness MCG.
Based on these various updates, as well as the City’s goals, policies and
programs, an amendment to the AASP is proposed to allow mixed-use
development within parcels zoned either C-S or M in ALUP Safety Zone
6 with a CUP.
7
8
1.Existing tax sharing agreement between the City and County for
property located in the AASP that specifies that there will be no or
limited property tax in favor of the City.
2.As a result, allowing housing in this area of town has a different fiscal
impact on the City than it does in other areas.
3.A fiscal impact analysis was prepared to examine the effects of
allowing mixed-use residential development within the C-S and M
zones based on this agreement.
9
Scenario 1: Development under current market conditions based on
the existing uses allowed in the AASP.
•Commercial with no residential theoretically would achieve an
annual fiscal “surplus.”
•However, current market and economic conditions indicates that
this surplus is not forthcoming.
Scenario 2: Development under current market conditions based on
allowing mixed-use residential development within the C-S and M
zones.
•This scenario projects a net negative fiscal impact.
•The tax sharing agreement limits property tax revenue received
from new residential development.
10
Four potential strategic approaches to achieving fiscal neutrality:
1.Maintenance/services Community Facilities District (CFD)
2.Renegotiation of the Property Tax Sharing Agreement with the County
3.Infrastructure Financing District negotiation with the County
4.Minimum commercial use requirements for residential projects
Ultimately, the proposed specific plan amendment responds to this
analysis by requiring a CUP to evaluate how the proposed project would
accomplish fiscal neutrality.
11
1.The most efficient way to unlock the potential for new residential
development in this area.
2.The alternative would include an extensive evaluation of the entire AASP
that would take years and significant funding to complete.
3.Allows for site-by-site analysis (public services, infrastructure,
compatibility) and the ability to condition a project based on that analysis.
4.Addresses the unique fiscal situation of property located in the AASP.
5.Limited prescription of standards allows for flexibility in design of future
projects.
6.Does not lengthen the time of review.
12
1.Alignment of the level of a Use Permit review could be paired consistent
with the City’s existing levels of Development Review.
2.An ordinance amendment could be made that requires mixed-use projects
that contain 49 or fewer residential units and 10,000 square feet or less
commercial space be processed through a Minor Use Permit.
3.This change would reduce the processing time and application cost for the
applicant.
4.A CUP would still be required for projects that contain 50 or more
residential units and more than 10,000 square feet of commercial
consistent with the level of Development Review.
13
To approve a CUP for a mixed-use development in the C-S and M zones, the PC shall
find the project consistent with development standards outlined in SLOMC Section
17.70.130 and make the following findings:
1.There is demonstrable water and sewer capacity to serve the project;
2.Any fiscal impact of the project to the City must be offset to achieve fiscal neutrality;
3.There are no nearby uses that generate sufficient air emissions, noise, odors or
vibration to create an incompatibility with proposed residential development;
4.Proposed residential uses are consistent with land use, safety or noise restrictions
set forth in the ALUP, and any residential portion of a mixed-use development shall
be wholly located within Safety Zone 6; and
5.There is adequate emergency response consistent with the Climate Adaptation and
Safety Element (CASE).
14
1.The 2003 Final Programmatic EIR for the Airport Area and Margarita Area Specific
Plans and Related Facilities Master Plans (“Final EIR”, or “AASP Final EIR”)
addressed future development within the Airport Area Specific Plan.
2.An Addendum to the Final EIR has been prepared to address changes to the
approved project pursuant to Section 15164(b) of the CEQA Guidelines.
3.An Addendum is appropriate to address the modified project because the proposed
changes to the approved project do not meet the conditions of Section 15162(a) for
preparation of a subsequent EIR.
4.The County of San Luis Obispo ALUC conducted an Initial Study and prepared a
Negative Declaration for the 2021 update of the ALUP that was used in part to inform
some of the conclusions contained in the Addendum.
15
Introduce a Draft Ordinance entitled:
An Ordinance of the City Council of the City of San Luis Obispo, California,
amending the Airport Area Specific Plan to allow mixed-use development
in the Service Commercial (C-S) and Manufacturing (M) zones subject to a
conditional use permit where appropriate and consistent with the Airport
Area Specific Plan, including adoption of an addendum to the Final
Environmental Impact Report for the Airport Area and Margarita Area
specific plans and related facilities master plans.
16
1.Adopt the proposed Ordinance as proposed.
2.Adopt the proposed Ordinance with modifications.
3.Continue consideration of the proposed amendments.
4.Deny the project.
17
17
18
18
19
236.4 acres are fully within Safety Zone 6, while the remaining 104.7
acres are at least partially within that safety zone.
20
•Airport Land Use Commission – January 15 and February 19, 2025
•Planning Commission – February 26, 2025
•SLO Chamber of Commerce Economic Development Committee –
April 3, 2025