San Luis Obispo Business
May, 2000

Chamber backs Auto Park Way expansion

The Chamber's Board of Directors has voted in favor of a recommendation by City staff to expand the Auto Park Way area, located off of Los Osos Valley Road. The expansion could provide a significant boost to San Luis Obispo's lucrative auto sales industry.

Marigold Center developer Paul Quong has approached the City with a plan to purchase the McBride property adjacent to the existing dealerships. His proposed development would increase the size of the Auto Park Way area by twenty-five acres, doubling its current size. Of those twenty-five acres, fourteen would be for new dealers, nine would be dedicated to open space and two acres for infrastructure. The added acreage could allow Kimball Motors to expand its present location and four other dealers, possibly those located downtown and on Broad Street, to be part of the "auto center." According to Quong, his proposed development would benefit San Luis Obispo for several reasons. "It (the expansion) would help preserve San Luis Obispo's tax base by keeping dealers that are threatening to take their businesses to other towns," explained Quong. "And, it would concentrate all the dealers in one area." It's a well-known fact that dealers do better when they're located next to each other.

Stanley Chrysler Plymouth Dodge is one dealer in the downtown area anxious to see the expansion get underway."It's not economically feasible for us to do business in downtown San Luis Obispo anymore," said Jeff Cole, Stanley's owner. "There's not enough parking for our customers or employees, it's very difficult for our trucks to come in and make deliveries, and we've seen roughly $45,000 worth of damage due to vandalism in the past three years." Cole added that he'll move his dealership outside the city if the expansion of Auto Park Way doesn't occur—a result that City officials fear.

According to Shelly Stanwyck, Economic Development Manager for the City of San Luis Obispo, the migration of auto dealers out of San Luis Obispo would be a huge blow to the City's economy.

Fifteen percent of the City's total tax revenue comes from new car sales and twenty percent of the City's General Fund comes from sales tax on new and used vehicles. Of the City's top eleven sales tax generators, seven are car dealers.

"Auto dealers play a very significant part in San Luis Obispo's financial well-being," said Stanwyck. "Their revenue goes a long way in helping to pay for City services and amenities like open space acquisition and the new creek walk which contribute heavily to our high quality of life."

In addition to the potential increase in sales for both dealers relocating to Auto Park Way and those already there, some other benefits include the freeing up of commercial space in the downtown area for other business uses, improved circulation in and around Auto Park Way with a new road that would connect the dealers, and possible enhancement of the city's water supply through access to an aquifer.

The open space element of this particular expansion project is a dark cloud that may end up with a silver lining. The City requires that developers devote half of any annexation property to permanent open space, which in this case would be twelve-and-a-half acres. However, the McBride's are not willing to reduce the sale price of their property to reflect the open space component, making the project economically unfeasible.

To get around this sticking point, Quong and the City seem to have come up with a compromise that more than makes up for the missing three-and-a-half acres. He's agreed to help the City purchase thirty acres of another sought-after piece of property, the Morganti Ranch, located on Los Osos Valley Road at Foothill Boulevard, for permanent open space.

"This project has many beneficial effects," said Stanwyck. "It presents us with an exciting redevelopment opportunity in the downtown area, it helps us to retain our local car dealers, and it's going to facilitate the acquisition of a significant amount of open space. It's a great opportunity for our City to accomplish many of it's General Plan goals."

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