By Robert J. Hansen | OBSERVER Staff Writer
The Sacramento City Council rejected a proposed ordinance at its Dec. 3 meeting that would have required any major development that receives $10 million or more in city funding to enter a community benefits agreement.
Neither businesses nor residents had been happy with the proposal.
“Sometimes when nobody agrees that means we’ve reached a good compromise and sometimes it means we just missed the mark, and I think that the latter is the case today,” outgoing Councilmember Katie Valenzuela said.
A community benefits agreement is a contract between developers and the city, designed to ensure specific community benefits in exchange for support for the project. These benefits often include hiring local residents, providing workforce training, creating affordable housing, and preventing displacement of nearby residents.
Kim Williams, director of Sacramento Investment Without Displacement, explained that the goal of the agreement was to protect long-standing residents – often in economically disadvantaged and minority communities – from gentrification and displacement caused by major developments.
“We want our city to prosper … but not at the expense of people who have poured their blood, sweat, and tears into this city for generations only to be pushed out,” Williams said.
Ultimately, neither Sacramento Investment Without Displacement nor the business community supported the proposed ordinance.
Scott Ford, deputy director of the Sacramento Downtown Partnership, expressed concerns that the ordinance could hinder the city’s recent development progress.
“I agree that community benefits are important, but they should be addressed on a case-by-case basis,” Ford told the council. “There are no community benefits if there is no project.”
The proposed ordinance stemmed from a lawsuit filed in December 2020 by Sacramento Investment Without Displacement against the UC Board of Regents over the Aggie Square project. The Aggie Square development, a $1.1 billion initiative spearheaded by UC Davis and developer Wexford Science and Technology, aims to create an innovation district along Stockton Boulevard. The lawsuit, citing violations of the California Environmental Quality Act, raised concerns about increased pollution, displacement, and the potential gentrification of surrounding communities.
In May 2021, the city, UC Regents and Sacramento Investment Without Displacement reached a settlement to address these concerns. The agreement included commitments to affordable housing investments, job creation, workforce development, and an annual fund to support local priorities. It also required the city to draft a community benefits agreement ordinance for council consideration by Jan. 1, 2022. However, the deadline was extended multiple times, most recently to this month, as negotiations continued.
Over the years, Sacramento Investment Without Displacement and the city have worked to develop an agreement that addresses community concerns and business interests.
“We’ve tried to strike a balance between the input we’ve received from SIWD, residents, and the business community,” Leslie Fritzsche, the city’s economic investment manager, told the council.
Despite the rejection of the ordinance, Williams emphasized that Sacramento Investment Without Displacement will remain vigilant about major projects and work directly with developers to negotiate community benefits agreements when needed.
“We’ll evaluate projects on a case-by-case basis,” Williams told The OBSERVER. “We’ll continue to collaborate with the business community, but we’re not waiting on the city to make that happen.”
The Aggie Square settlement continues to serve as a model for what community benefits agreements can achieve when community groups and developers collaborate, although challenges in balancing competing interests remain persistent.
At his final meeting as mayor, Darrell Steinberg said the community benefits agreement’s defeat doesn’t prevent one from being reached in the future. Incoming Mayor Kevin McCarty said at a recent town hall that he supports one, but doesn’t envision one on a foreseeable timeline.
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