Burbank’s Economic Development Agenda Updated & Assessed

Bob, it’s been some time since you last spoke with The Planning Report. Bring us up to date on Burbank’s community development goals and your department’s success to date.

We have seen major changes in the last year and a half. Our economic incentive zone program, our utility upgrade programs, and our five-point economic development program have kind of reached their pinnacle of success. We’re down to very low vacancy rates throughout the city.

The industrial areas and Media District can’t house development opportunities that are coming. We're looking, therefore, at developing new strategies now for the next five years. 

Those strategies are going to focus on how we accommodate the expansion of Disney, Warner Brothers, the media industry, and the electric transportation industries. 

What would be considered success by the City Council and by the department in live years? 

The development of the unused, or undeveloped land—such as the large Lockheed parcels and some of the undeveloped properties along San Fernando Road. We would like to see these areas developed and occupied by tenants that will bring jobs. 

We'd like to see downtown Burbank—the Village area and the Mall—complete its transition to more small retail shops, and put more "polish" on the rough draft we have now. We’d also like to continue to focus on the Media District, such as completing the NBC Plaza. 

What are the choices that the city and Council must make to accomplish those goals? 

Some of the public policy choices are going to be related to expenditures for infrastructure development, and where those dollars will have the greatest impact. There will be public policy discussions on how much money will go to school development versus street and sidewalk improvement. The infrastructure cost of utilities construction versus rate increases will also be a major issue, especially given the current status of deregulation. 

When last you spoke to TPR, you were proud of the city's development streamlining ordinance. How has that worked out, and how does it lit into the city's needs you have just outlined?

The streamlining ordinance has been in practice for almost four years. This year, for example, we've processed $149 million in permit for commercial and industrial development. That's more commercial development than in pre-recession times. It continues to climb every year, and we expect that figure to be even higher next year. 

We credit out increase in development activity to the media industry and because we've been processing certain projects in two to four weeks, rather than our previous six to nine month time frame. This year we also approved the Warner Bros. Master Plan in record time: ten months.

Moving to the specific, what issues were raised in processing the Warner Bros. expansion, and how did the city resolve them? 

Most of the issues raised in the Warner Bros. plans were not density issues—bulk, scale, or shadows—because those issues were well addressed in the Media District specific plan. 

There were not many controversies. The biggest issues dealt with neighborhood protection in the surrounding communities. Much of that contention was dealt with quickly, because we had already performed neighborhood protection plans, involving cul-de-sacking streets, etc. 

For example, we have completed the Rancho master plan and have begun implementing the neighborhood protection plan for that community. We have also just completed the Magnolia Park neighborhood protection master plan. All three communities surrounding the area, including Toluca Lake, have neighborhood protection plans in place. 

Because the plans were already in place we had no problem revising the Warner Bros. plans to make them satisfactory to neighborhood and community planning groups. The neighborhood planning groups were active from start to finish in the planning process.

Share the lessons/success of the Media District with your neighboring cities? With the location of Dream Works in Playa Vista, Sony in Culver City, and the DreamWorks animation studio planned for Glendale, how does Burbank retain industry concentration when there is a natural tendency for an enterprise to hunt for "the best deal"?

I think most planners and redevelopment officials have known for years that to have successful development, developers need to be certain about what their entitlement rights are. This is the case in the Media District. I think this also helped us retain expansion within the Warner Bros. and Walt Disney Company campuses.

The market has served us well—we have maintained our ability to build, and have kept the cost low enough to bring tenants into new buildings. This has not occurred until just recently. We recently found that we had a number of interested parties for the NBC Plaza project, and this has caused the city and the property owner to look at potential development of that sight. This has happened because the market is so tied up and the demand is so great that now the dollar per square foot rental rates are ready to the point where we can now start to develop that area. 

As a former deputy director of the Los Angeles Community Redevelopment Agency, and after reading Joel Kotkin's comments in the December issue or Metro Investment Report about the Mayor's commitment to economic development, what lessons can you offer John Malloy and the LA/CRA? 

I have two suggestions for Mr. Malloy of LA/CRA. First, make sure that you break your strategies down into manageable sections so that you can focus on the issues that need to get done. Otherwise, you spread the agency so thin that the agency can't accomplish its defined objectives. 

My second suggestion: delegate authority to district offices or district zones to allow somebody else to manage the day-to-day project. There need to be manageable districts through which the agency is able to meet management objectives. 

How does the City of Los Angeles' economic development policy compare with Burbank's? 

The City of Los Angeles' economic incentives task force is going in the right direction. They have talked about increasing resources, and cutting down processing and permitting time. These things are important. 

Are they going to be a competitor to the City of Burbank? No. 

We have a solid foundation of businesses in this community that have put down roots. The opportunities for these businesses to grow in Burbank are something that we are going to work towards. The business-friendly and community-oriented environment in Burbank are things that keep businesses here. 

Compare and contrast the economic incentives offered by the cities of Burbank and Los Angeles. 

We understand that Los Angeles is proposing a $5 million per year incentive program, and that L.A. has 15-20 people in the Mayor's Office focusing on economic development.

On the other hand, Burbank is a community of 93,000 people, and we have three professionals devoted full time to economic developments; we commit $250,000 per year to advertising and nearly $1 million in incentives. That is $1 million for 93,000 people versus $5 million for 4 million people in Los Angeles.

Is it fair? If that’s what the City of Los Angeles can do, that's terrific. Our City Council, over the last five years, has made a strong commitment to this program and we hope that the council will continue to support our programs. 

I believe that Burbank has certain benefits that are intangible; benefits that unfortunately, LA doesn't have. 

You said in our earlier interview that you thought one of the advantages Burbank had was its airport. There currently seems to be considerable controversy surrounding expansion of the Burbank airport. What are your thoughts about the airport in relation to economic development and your task as community development officer? 

The airport is still important to us for economic development. It really is an engine for the region. Our City Council recognizes that fact. As an economic development director, I recognize the importance or building a new facility.

At the same time, you don't destroy your own backyard at the price of new development. We also recognize that there are big limitations on new development, and that's what we're working at through the mediation process between the airport and the city. We want to see the airport be successful, but we don't want to give away our city. 

I think that goal can be accomplished to the satisfaction of all parties over time. We're working with the other two cities to see if we can reach that objective. 

What are your thoughts on the repeated attempts of Sacramento to modify the powers of redevelopment agencies and the recent changes to redevelopment law through AB 1290? 

The constant barrage of criticism over redevelopment is tough because it continues to keep us under the gun. We'd rather get out and do what we need to do, rather than continuously defending ourselves from Sacramento's attacks. 

In defense of the legislature, however, I think local agencies too often do not stay within the parameters of redevelopment's objectives.

Burbank, for example, has allocated $23 million worth or redevelopment funds into our schools. Schools are a worthy because and the investment is important to our schools and an economic benefit to our redevelopment areas, but the Legislature appears to be concerned about how far and how wide can agencies begin to interpret the state legislation on redevelopment's goals and objectives. 

I think redevelopment agencies have got to bring themselves back within those parameters and city councils must understand that there are limitations on how redevelopment should be applied. When city councils understand the limitations, then I think we'll be able to convince the Legislature to lift its barrage on the agencies. 

Let's go back a little bit to your earlier comment about Burbank's future goals and priorities. You spoke about the next five years; what's anticipated? 

Right now we've been concentrating on occupancy of existing buildings. Finding tenants for older, vacant buildings has been very successful. 

Next, we'll be focusing on more construction—more redevelopment. I think there are ways to continue the streamlining process. For instance, we can make sure that developers know the rules. And when they walk in the door, we can make sure that developers know that they are going to be processed in a timely fashion. 

Second, we must keep our construction costs down. Right now the dollar costs of new construction and rental returns are so thin that nearly anything can discourage development. 

I am going to continue our economic program, in which we pay the five dollar per square foot transportation and community facilities fees through the community.

We need to continue to work with our Public Service Department and other public/private utilities to make sure that their policies don't end up adversely impacting the cost to developers. And we're working with those departments now to keep down project costs. 

Third, but not least, I think the most important element of redevelopment in Burbank is relocating infrastructure around the sites that need to be developed to make those sites attractive for developers. We don't need to do that in the Media District, but we certainly need to do it in our Golden State redevelopment project area. 

Is the City pursuing a developer for a football stadium or arena? 

No, we're not in the game for a stadium and we don't plan on playing the game. We competed once before for the arena. I think that the community sent a clear message that an arena is not what they envision for Burbank. 

Lastly, what do you think about fiscal reforms that would mitigate local reliance upon the sales tax. 

We love sales tax. We'll continue to fight for it. We're negotiating a deal right now which may give us a substantial increase in sales tax. We will continue to pursue sales tax as long as the state's sales tax structure is what it is today. Cities ought to be in a position to compete. Competition is good and healthy for all of us. We'll continue to play that game.