The June Report

Anaheim City Council Rejects Proposed Fire Sprinkler Retrofits and

Expensive Fire Fighter Air Replenishment System (FARS) in High Rise Buildings

NAIOP SoCal has been fighting against the City of Anaheim Fire Department recommendation to adopt excessive and expensive fire code regulations since November 2016. Finally, at the June 6, 2017 Council meeting, the Council, led by Mayor Tom Tait, voted unanimously not to adopt the Fire Chief’s request. This was a huge victory for NAIOP SoCal and commercial real estate. The Anaheim Fire Department recommended the adoption of the California fire code amendments, which is required, but they also asked the Council to add two new code requirements. The first proposed amendment to the Anaheim fire code was to require the retrofitting of fire sprinklers in commercial buildings when 5,000 square feet or more of improvements were made to the building. The second recommendation was to require the installation of FARS (Firefighter Air Replenishment System) in high rise buildings over 75 feet. The estimated cost of this system is 80 cents a square foot, plus annual inspection fees exceeding $2,500 added to the cost of ongoing maintenance of the system. Special thanks to Legislative Affairs Committee Member Nick Arambarri, architect and Associate/Managing Director for LPA, Inc. Nick was able to provide information about the proposed FARS and his experience with the City of Newport Beach. Newport Beach had adopted and later repealed the FARS requirement for high rise buildings. This information, plus other objections raised by NAIOP and the fact that only 5 of the 540 jurisdictions in the State of California were currently requiring the use of the system in their fire code helped persuade the Council. For all of NAIOP SoCal’s written objections to the proposal, visit Legislative Update.


City of LA Affordable Housing Linkage Fee Hits Serious Pushback

A vote on the proposed Linkage Fee being pushed by Mayor Garcetti that would charge new residential development $12 per square foot and commercial development $5 a square foot was put off by a key City Committee until late July or later. City Council Committee members questioned whether it is advisable to put an increased cost on building housing when the cost of housing is such a problem, especially in light of the fact the fee would fund only a few affordable units. The cost to businesses was also an issue. We will continue to work with the coalition fighting this proposal and keep you advised.


It Never Stops – LA County Water Resilience PARCEL TAX Proposal

This is actually round two of an effort that started in 2013 with LA County trying to find funding for projects to meet the LA Water Quality Control Board Stormwater Permit Order (MS4 permits) and the LA County staff tried to push a Proposition 218 property assessment, which we were able to stop. The estimated cost then was $20 Billion. Now, Supervisor Kuehl, not staff, is leading the push on the stormwater issue, but again it appears there is an effort to create a “plan” that goes beyond just complying with the MS4 permits. There were some preliminary conversations between County staff and members of the business community, yet nothing of substance was really forthcoming. Then, last month, Supervisors Kuehl and Solis presented a motion that was unanimously approved to develop a “Water Resilience Plan” and a funding plan using “an appropriate parcel tax”.


The motion indicates over the next 9 months the Resilience Plan is to be finalized and a parcel tax funding plan is to be developed. No specifics as yet, and supposedly a draft project plan is to be released at the end of this month. The motion does say the business community is to be involved in the development of the Plan and the funding. We have brought together much of the same coalition we worked with in 2013, and have made it clear to the Supervisors we intend to be very actively involved. This will be discussed in detail at the next Legislative Affairs Committee meeting, and, obviously, the key issue is the parcel tax push.


More from LA County – Rental Market Analysis and Policy Development

Also in May, without any type of notice or outreach, Supervisors Kuehl and Solis brought a motion directing staff to develop a “Tenant Protection Policy Framework”. Although most of the focus is on rent control for housing, the motion clearly impacts the commercial sector. Within 6-months staff is to, among other issues;

  1. Analyze the rental housing stock and “commercial properties for lease;”
  2. Provide recommendations for “actions to protect residential and commercial tenants countywide;”
  3. Develop a concept for a “comprehensive Los Angeles County Tenancy Report and Dashboard focused on the state of residential and commercial tenancies throughout Los Angeles County;”
  4. Identify legislative acts that should be taken to “support the County’s ability to protect its residents and commercial establishments;” and
  5. “Engage” the cities within the County to see if they want to coordinate “in the development and administration of one or more tenant protection policies.”

No details were provided as to the scope or real meaning of all the above, yet it appears this so-called tenant protection effort could be very problematic to our NAIOP members. There is nothing in the motion about working with or even contacting the business community during this 6-month effort. Supervisor Barger did get the Board to include the Los Angeles Economic Development Commission (LAEDC) in this effort, and the business community is requesting to be part of the process, but no response has been received to date.


SCAQMD and CARB Indirect Source Rule (ISRs) Efforts Moving Forward

The fight surrounding Indirect Source Rules (ISRs) is now a two-front war; here locally (SCAQMD) and in Sacramento (CARB). We now have a fully engaged coalition in Sacramento that includes the California Business Properties Association (CBPA, Rex Hime), as well as continuing our work with the long standing local coalition. The Sacramento coalition has met with CARB staff and the Governor’s office in follow up to the March 31 letter that was sent expressing our anger over the actions taken by the CARB Board. A White Paper, that will be signed by nearly 40 organizations, is being finalized that will go to the CARB Board and Governor further explaining how ISRs will negatively impact both the economy and several of the Governor’s objectives. There is still much more to do in Sacramento.


Locally, the meetings have begun surrounding the “facility based measures” that are in the recently approved AQMP. The concept of these stakeholder working groups is to analyze ways to decrease emissions from freight facilities, including warehouses. This is supposed to develop “voluntary” means of doing so, but the SCAQMD staff says whatever might be developed has to be “creditable” under the Federal Clean Air Act. To create such mechanisms generally requires some sort of enforcement mechanism, which would seem to turn any “voluntary” measure into a mandatory action. Any such measures would apply not only to new facilities, but to existing facilities as well. The focus of the “facility based measures”/ISRs is to cut diesel emissions. For warehouses, they may have some diesel-powered engines, such as yard trucks, forklifts, and generators, but the SCAQMD focus is on somehow making warehouses responsible for cutting truck emissions. It would be very helpful for NAIOP members who operate warehouses to provide input as we want to focus on what might exist within your business plans. Yet, the key question is whether the goods movement industry provides SCAQMD with ideas they will make mandatory and claim they are all our ideas, or not provide any such information and deal with all this in a formal rulemaking process, which several SCAQMD Board members want to do anyway.