The Public Facility Zone Ordinance: What It Means From the Perspective of a Public Agency

Asset management of publicly owned properties has been discussed in The Planning Report in the past two issues from the perspective of L.A. Unified School District and downtown properties owned by L.A. County Chief Administration Office (CAO). The Public Facility Zone Ordinance currently under study by the City of Los Angeles will have a broad impact that affects all public entities throughout the City of Los Angeles.

The public agencies affected by this ordinance include the Federal General Services Administration, U.S. Postal Service, Army Corps of Engineers, State General Services Administration, Caltrans, L.A. County CAO, L.A. County Department of Public Works, L.A. Unified School District, L.A. Community College District, University of California, Southern California Rapid Transit District, and L.A. County Transportation Commission, not to mention the various departments of the City of Los Angeles.

Quasi-public entities, such as Metropolitan Water District, Southern California Gas Co., University of Southern California, other private schools, hospitals, churches, railroads, and telephone companies may also be affected by this ordinance since the City has not identified specifically on which properties the ordinance is to be implemented.

The ordinance under consideration is a part of the larger AB283 planning effort. In the early 1970's, Community Plans were drawn up for the 35 planning areas of the City of Los Angeles. These community and district plans identified land uses within broad categories of housing, commerce, industry, open space, and other public/quasi-public uses. The General Plan/Zoning consistency Program (AB283) was established in 1985 to bring the City's zoning into conformance with the community plans.

The city zoning code does not contain corresponding zones for open space and public facility land uses. Until new zoning codes could be created, ordinance No. 163,679, known as the Pound Sign ordinance, was enacted in 1987. Under the Pound Sign ordinance, proposed development on all existing open space, other public, or quasi-public lands would require a conditional use type approval granted by the City of Los Angeles.

The Public Facility Zone ordinance and related Open Space Zone ordinance are intended to replace the pound sign designations applicable to publicly owned land. Approximately 20% of all the City's land in the community plans are designated as open space or public facility zones. Private property designated with a pound sign, such as golf courses, private schools, and private hospitals, have not been addressed.

Early versions of the Public Facility ordinance did not allow economic development on public lands. The most recent version allows mixed public/private uses, however, these uses are only allowed by conditional use permit after plan amendments revise the public facility land use designations to a mixed use designation. The Public Facility ordinance effectively reduces the asset value public agencies hold by subjecting all public properties to additional discretionary review by the City of Los Angeles. This feature of the ordinance contradicts many public agencies' growing focus on raising revenues in creative ways.

When the Community Plans were originally created, there was no Proposition 13 and no Gann spending limit. Since Proposition 13, population growth and demand for services has increased at a faster pace than public agency funding. The result is inadequate transportation systems, lack of sewage treatment capacity, and a reduction in quality of services provided to the public. Public agencies are now required to look at the revenue generating potential of their property to make up this shortfall in funding. The ordinance brings into focus the dichotomy between competing public needs to maintain open spaces and to increase services through revenue enhancement.

From the public agency perspective, the key points are as follows:

• When property was acquired it was paid for at full market value based on existing land use and zoning. The ownership of that property by a public entity does not diminish the development rights and economic value inherent with the land.
• Public agency property exists in every Planning Arca of the City of Los Angeles. Each of these thirty-five areas is distinct and unique. The existing zoning of these scattered sites is more compatible with the adjacent land uses than would be a city­wide “Public Facility” zone.
• When developed, public lands generate sales tax revenues and possessory interest taxes for the City. The City also benefits in terms of increased employment opportunities, business license fees, and other job-related revenues. Income generated through leasing development rights provides additional funds for public improvements which ultimately benefit all of our residents.
• The Public Facility ordinance does not recognize the higher level of authority of non-city agencies. Rather than force agencies to “just say no,” time should be taken to ensure an ordinance that all can live with.

The resolution of this ordinance will be a test of how well public agencies can work together to address the mutual concerns of providing a better environment and better services to the citizens of Los Angeles.