What's at stake?
Many city council members raised questions about why they should support SEDA.
The city has already proposed to add roughly 50,000 homes in the different fringe part of Fresno.
A proposed mega-development outside of southeast Fresno, known as SEDA, is losing support with the Fresno City Council after Fresno Mayor Jerry Dyer said on Thursday that city residents would have to take on $1.5 billion in debt to build new water and sewer lines just to build the part developers are angling at first, located in Clovis Unified.
The cost to city residents is so high, Dyer said, that it would take years of increased utility rates for Fresno residents to allow developers enough time to pay back the debt City Hall would have to take on to build the upfront infrastructure for SEDA.
“The potential for it [the costs of SEDA] to fall on the general fund and ratepayers, I believe it’s all true,” Dyer said. “That return on investment would have taken so long, it would have been on the backs of ratepayers.”
Dyer proposed for SEDA to take a massive haircut – asking the city council to focus on a much smaller portion, he calls “South SEDA.” It’s an industrial-focused slice along Jensen Avenue that he says doesn’t have huge infrastructure needs like a new sewer. The homes there, located in Sanger Unified, will likely not command the premium price for homes like SEDA’s northern Clovis Unified flank.
“I don’t think we should do any further phasing in the next four, five, 10 years because it’s cost-prohibitive,” Dyer concluded on SEDA.
Dyer’s stance is a huge blow for the home development industry and City Hall insiders who have kept quiet on the infrastructure costs of SEDA for the last two years. The mega-project’s estimated infrastructure costs have been known at least since last December, when an initial infrastructure cost report was delivered to City Manager Georgeanne White.
But top Dyer administration officials have remained tight-lipped to the Fresno City Council on what the report found. It was only after Thursday’s council workshop on SEDA went up in flames that Dyer himself gave the council the straight talk on how the proposal had troubled his conscience by straining the city’s bonding capacity.
The planning department’s presentation to the city council gave numerous misleading and false statements, documents show.
As many of the planner’s talking points fell apart under questioning from Fresno councilmembers Miguel Arias and Annalisa Perea, Dyer stepped in to stop the bleeding.
“We have an ugly history of expanding on the backs of existing residents,” said city Councilmember Nelson Esparza in response to Dyer. “It is difficult to believe that we’ll be able to do it differently this time.”
Planning department’s presentation falls apart
On Thursday, the city planning staff said they hoped to “set the record straight” on SEDA, a proposal which has faced delays and uncertainty since the Dyer administration first unveiled the proposal in summer 2023.
After court rulings and finance troubles over the last two years, Thursday’s presentation was an attempt to restart the conversation around SEDA after city officials brokered a deal last December to give the southeast area a unique tax-sharing incentive which other parts of the city don’t receive.
Planning Director Jennifer Clark and her second-in-command, Sophia Pagoulatos, prepared roughly 40 slides to the council on the “myths” and “facts” of SEDA.
For example, the presentation claimed as a “fact” that “the SEDA plan results in reduced vehicle miles traveled — a planning term that refers to how far people have to drive to access nearby services and jobs.”
But according to the city’s own documents, SEDA will increase VMT by 162%. That increase is likely an underestimate, as the planning department claims that the new residents of SEDA would drive less than residents of downtown San Francisco and even Manhattan–a claim that one of the state’s top legal experts said would likely not hold up in court.
If SEDA residents drive about as much as northeast Fresno residents near Riverpark and other amenities, VMT in the SEDA area would likely increase by about 500-600%.
The presentation also said that it was a “myth” that SEDA would “increase carbon emissions,” claiming that carbon emissions had already been addressed in the SEDA plan.
SEDA would increase carbon emissions by roughly 510,000 tons each year, according to the city’s environmental review. This increase, which is not addressed in the environmental review, would cancel out nearly all the climate change progress the city planned to make in the coming decades. The cost of mitigating those emissions, which is required by state law, is roughly $25 million a year.
The planning department slides also claimed that SEDA “addresses air quality.”
Air pollution emissions will increase 600% in the area, according to the city’s environmental review.
Clark, the chief city planner, also told the city council that 74% of the city’s new housing has been infill – implying that a look towards the fringe was reasonable. But the city’s housing data shows that the vast majority of the city’s development already occurs at the fringe.
Dyer’s One Fresno Housing Strategy has also shown that the city’s housing market has a “glut” of single-family homes, with a severe shortage of affordable housing.
The presentation began to fall apart after Perea asked why the city planning staff had used conflicting population growth projections in west Fresno versus for SEDA.
West of Highway 99, the city had used the state’s most recent multi-decade projection showing a 0.2% annual growth rate. But for SEDA, the city assumed 1.5% – a nearly tenfold difference that fundamentally undermines the project’s key assumption.
“Did we use different data for each plan?” Perea asked.
The city planning staff refused to confirm that the numbers were indeed different.
Instead, Pagoulatos claimed that the projections were the same “in a general way.”
After the planning staff’s evasions with Perea, Arias piled on. He focused on the staff’s incomplete picture of the regional housing market.
Clark’s slideshow showed how Madera County had permitted 16,000 homes. Clovis had another 15,000 in the pipeline too. The city was at risk of falling behind, the slide show implied.
The slideshow failed to mention that Fresno already permitted roughly 50,000 homes west of Highway 99.
Arias asked why the planning department was asking them to approve 45,000 more homes in SEDA. He said that the threat of the city losing business to more developer-friendly areas was overblown, citing state figures showing that building rates in Madera and Clovis have also slowed down in recent years.
“We still have 27 years worth of growth already in the system,” Arias said. “I’m not concerned about what Madera and Clovis are doing. They’re figuring out that growth doesn’t pay for itself.”
It was soon after Arias’ demolition job that Dyer stepped up to the podium. He admitted to the council that he had lost faith in most of the SEDA project.
“I was sitting in my office and I couldn’t take anymore,” Dyer said.
Dyer doesn’t support most of SEDA moving forward under his watch
The major hopes of SEDA, Dyer told the council, presented a huge liability for the city of Fresno. He told the council, for the first time, that the initial infrastructure outlay for the major residential flank of SEDA would cost over $1 billion.
“You can’t piecemeal sewer mains,” Dyer said. “In order to build water mains and sewer maines from the north end, down the Temperance trunk line, all the way over to our wastewater treatment plant was going to cost us a lot of money.”
“In many cases, it could have been $1.5 billion.”
That huge figure – roughly eight times the size of Gov. Gavin Newsom’s infrastructure investment in Downtown Fresno — was too much for Dyer to stomach.
Many council members became uneasy with the idea that, as the city has racked up a $1.5 billion bill in deferred repairs to roads and sidewalks, they would choose instead to commit a similar amount of public funds for a new part of Clovis Unified.
“For decades, the city has expanded, expanded, expanded. Every expansion has stretched our resources thinner,” said Esparza. “Even in the expanded areas on the fringes of the city now, they’re very much struggling with basic, fundamental infrastructure. Quality of life issues that we can’t afford.”
Dyer proposed that the city should “only” move forward with the southern flank of SEDA – a much smaller portion along Jensen Avenue which has more existing infrastructure for the city to work with. That would exclude the SEDA’s Clovis Unified area, which is the most lucrative part for developers to build in, often commanding a six-figure premium for every single home built.
“I believe we need to move forward during my administration with the opening of south SEDA and south SEDA only,” Dyer said.
Due to industrial pollution in the area, southeast Fresno councilmember Brandon Vang said it wouldn’t be “practical” to build homes there.
“The market doing what it’s going to do, I don’t see affordable market rate housing coming out of this,” Esparza added.
Financing options for SEDA will be presented to the council in the coming months. White, the city manager, broke with Dyer, suggesting that the council still approve the whole SEDA plan.
“I would encourage us to continue moving forward with the entire plan area,” she said. “If there’s a private sector interest that wants to come in and do an infrastructure plan and finance it…why would we not want that?”
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