Hello Gilroy! This month’s focus is on the three Economic Development Initiatives we’ve been diligently working on and where they currently stand. As you’ll read below from City Administrator Jimmy Forbis, we’re progressing on all three. As we continue to pursue economic development projects, not to mention bridges, fire stations, a community center, and other large-scale builds potentially in our future, I’d like to give a mention to Measure D in your election ballot that asks Gilroy voters to consider an amendment to the 1960 Gilroy City Charter that would add the option of using a single contractor to design, build and manage a large-scale project ($1 million or more) instead of the one option we currently have that separates the responsibilities of design and build. This amendment would allow two options of competitive bidding to be considered for large projects and to use the one that saves time and/or money.

Please join me on Saturday, November 5^th at 9:30 am in Council Chambers, together with Jimmy Forbis, for conversation and coffee on these subjects and more. There’s a lot going on!

Mayor Marie Blankley, CPA

Over the last several years, the City, through the Gilroy Economic Development Partnership (GEDP), has worked on three key initiatives intended to not only assist the City and Community in recovering from the Covid-19 economic downturn but also develop and utilize three significant City assets – the Gilroy Sports Park, the Recreation Gateway Area (acreage surrounding Gilroy Gardens), and the Gourmet/Railroad alleys in downtown.

In conjunction with these projects, the City Council authorized the placement of Measure D on the November 2022 ballot for Gilroy voters to consider modifying the City’s Charter to allow for “design-build” contracts when it will reduce costs and/or project time for large construction projects. Measure D would also update the City’s Charter regarding public noticing for bidding to also include modern methods of advertising.

Projects and initiatives of this size take a considerable amount of time and resources and each initiative is at different points in their development. For example, discussions for the Ice Center began almost three years ago and have just recently reached a significant milestone, Gourmet/Railroad alleys are funded and under design, and the Recreation Gateway Area is in negotiations with a potential developer. Committing to projects and initiatives of such large scale requires long-term planning and a commitment by the City and community to see the project through to the finish.

Each of the projects share a common goal: attract visitors and improve the quality of life

for all Gilroyans.

At their June 20, 2022, meeting, the City Council approved a non-binding term sheet with Sharks Sports Entertainment (SSE) for development of a two-sheet ice facility at Gilroy Sports Park. This is a significant step in the process as the term sheet provides the framework for a final agreement between the Sharks and the City for the funding, construction, and operation of the Ice Center. To get to this point, both the Sharks and the City allocated time and resources to analyze the economic market and determine the financial viability of the project.

At this time, the project is on pause as the City awaits two significant processes – the completion of the Surplus Lands Act process and the voters' consideration of Measure D (described below) on the 2022 November General Election that would permit “design-build” contracts.

The State Surplus Land Act (Government Code Section 54220 et seq) applies generally to any “disposition” of city-owned property. It has various exceptions, but generally requires a city to notify housing developers and public agencies that may be interested in open-space uses of the land prior to any disposition of city-owned property – this is the process that the City completed for the Recreation Gateway Area (previously known as the “536”). For the City to dispose of surplus land, either through sale or a long-term lease, it is required to complete the Surplus Land Act process.

Once both the Surplus Lands Act process and the voters’ consideration of Measure D are completed, the City can re-initiate discussions with the Sharks as soon as early 2023, enabling the City and Sharks to develop a final financing, construction and operating agreement of the facility.

The potential development of the unused lands around Gilroy Gardens, known as the Recreation Gateway Area, has completed the State of California Surplus Lands Act process, which requires cities to negotiate in good faith with park and housing developers prior to the disposition of surplus land. As part of this process, the City was required to make a declaration of the surplus land, receive proposals for open space and/or housing, and negotiate in good faith. The City received one proposal from Santa Clara County Parks and over the last few months, the City has been discussing the surplus property with their representatives. The County is focused on maintaining opportunities for future regional trail connections and the City also supports efforts to connect existing trails to enhance the trail system and at this time believes that both goals – trail connections and development of the property for tourism/recreational development - can be achieved.

At their September 12, 2022 meeting, the City Council approved a 12-month Exclusive Negotiating Agreement (ENA) with Select Contracts. An ENA is a condition in which each party grants the other party sole rights regarding a particular business function or product sale and/or purchase. Put another way, exclusivity is an arrangement between two parties wherein neither will explore entering a similar deal with other parties for a certain period.

The exclusivity period would also allow for both the City and Select Contracts to share information pertinent to developing a business agreement that would ultimately be subject to the approval of the City Council.

This process is very similar to the one undertaken for the Sharks Ice project.

The project that is furthest along in its development is the Downton Gourmet Alley. In March 2022, the City was awarded a $3.9 million grant from the California Department of Transportation (“Caltrans”) Clean California Local Grant Program for cleanup events and infrastructure improvements along Gourmet Alley and Railroad Alley. This grant is designed to provide infrastructure investments in those downtown corridors that is anticipated to reduce/eliminate barriers to private development and improve the aesthetics in the alleys. The project is currently in the design phase and is expected to begin construction in early 2023. This project will integrate with another project that is currently under construction – The Downtown Gourmet Parking Lot on Eigleberry and 7^th Street, which is expected to be completed in early 2023 and will provide a gateway to downtown for vehicles, bicycles and pedestrians. Both projects will see a total of over $6 million invested in downtown and is expected to support private development in the downtown area.