After an eight-hour hearing late Tuesday, the Pismo Beach City Council sent a massive project proposed in Price Canyon back with questions and direction that will delay its consideration of any development in that area for months.
Instead of approving agreements that would push ahead the controversial Spanish Springs project, the council decided it wanted the developer to work with one of his neighbors — a property owner who also wants to develop his land — to coordinate their projects and develop new plans to cover the entire area.
The council did approve two items: the Spanish Springs environmental impact report, and some amendments to the city’s general plan, which guides long-term growth.
But they delayed action on three other documents — and instead, Spanish Springs faces a redesign. Council members said that instead of considering both projects separately, they should step back and look at what overall development would be best for the Price Canyon area.
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“We’re stuck, because really to do good planning you have to look at the entire planning area,” Mayor Shelly Higginbotham said as the council’s meeting crept toward 2:30 a.m. Wednesday.
The projects — Spanish Springs and another plan known as Pismo Ranch, both located outside city limits — propose hundreds of homes, hotel rooms and conference or event-type facilities in the canyon.
The 961-acre Spanish Springs project is much further along in the planning process, however.
Darren Shetler, co-owner of the Pismo Ranch property, last week asked the council to consider incorporating his proposal into some of the Spanish Springs planning documents, insisting that some of the related concepts should be studied together.
The council later agreed that “there would be value in getting both projects together,” as Councilman Ed Waage said. “If we’re going to do this, we shouldn’t do it piecemeal.”
The council heard more than three hours of comments from local residents, business owners and other interested citizens who passionately opined for and against development in the canyon.
“There’s still a lot of glaring questions out there,” said Arroyo Grande resident Clive Grey. “Water is a biggie. This is not a development, it’s a small town. Please, please think about it.”
The council expressed concerns about the reliability and availability of the water proposed for the project, which includes an upgrade of the city’s wastewater treatment plant to produce recycled water.
Both Spanish Springs and Pismo Ranch would have to be annexed into the city before being developed, and the local board that considers such requests, the San Luis Obispo Local Agency Formation Commission, has made it clear that a water supply must be adequate, reliable and in hand.
One of the next steps is for city staff to sit down with Spanish Springs developer Stephen Hester and Shetler to start discussing a joint planning area, said Pismo Beach City Manager Jim Lewis.
The two property owners have disagreed in the past on what specific development should be built in Price Canyon, and have been on separate planning tracks for a few years.
Spanish Springs project representative Carol Florence said Wednesday that she’ll look to the city for better clarification on what coordination is expected to look like.
“Of course you need to do things like planning for entire comprehensive annexation area, but we think we have done that,” Florence said. “The notion that we’re going to reset the specific plan and redo the EIR; no, that’s certainly not our preference.”
Shetler said later Wednesday that he also thought the proposals could be retained in two separate specific plans. Those details still need to be worked out with city staff.
“We probably would have preferred one (specific plan) early on, but our goal now is to not slow their progress down,” Shetler said. “We just want to get a plan that the public’s going to be satisfied with.”
During the meeting, a Spanish Springs project representative implored the council to evaluate the issue more.
“Ask if that’s really fair to an applicant who has spent this much time and money, which you’ve known full well is an independent specific plan,” said Mark McGuire, the project’s legal counsel.
Lewis said the issues he heard the council raise, including questions about water supply and reliability, won’t be answered in two weeks. Also, the council and city staff is about to shift its focus to new revitalization efforts downtown.
“I’ve heard you say you want more coordination between two parties,” Lewis said during the meeting, “and the two parties have not demonstrated a great working relationship, for better or worse. But if you want more joint planning from a policy direction, that’s your right.
“That is hard for them to swallow, but this is your community, and you need to plan for it in a way you feel comfortable,” he added.