Petaluma Planning Commission denies Corona Station permit, delaying contentious project

Planning commissioners again had a chance to weigh in on the contentious Corona Station development project Tuesday, denying a permit that would allow construction of the 110-unit development alongside the proposed east side SMART station following council’s formal approval late last month.

The 4-2 decision by commissioners likely kicks the item back to the city council once again and prolongs what has been a flashpoint development issue in the community, underlining the body’s strong distaste for the development.

Commissioners voted against issuing the permit largely over fundamental disagreements with the entire project and its connection to two other developments and the SMART station. The move is a staunch message of disapproval from a body whose prior decisions on the project amounted to considerable opposition, in direct conflict with the council’s votes of support.

“I just don’t think this is the right location for this, that’s all,” Commissioner Heidi Bauer said. “I think we could be doing better, I think it should be mixed-use and it’s not what I think of when it comes to transit-oriented development.”

Commissioner Sandi Potter was absent, with Commissioner Patrick Streeter and City Councilman Kevin McDonnell voting in the minority to approve the permit. The commission unanimously approved the site plan and architectural elements of the single-family development.

It marks the fourth time the commission has deliberated over the Corona Station project, and comes on the heels of the council’s decision Feb. 27 to approve a zoning change allowing the 110 single-family units to move forward. The recent request for a permit to construct at the site was the next step in what has become a drawn-out process ping-ponging between planning commissioners and city council.

Despite the commission’s decision to strike down the permit, council’s final OK remains unchanged and the development is all but assured to continue, with land-owner Todd Kurtin of Lomas Partners, LLC saying he will appeal the decision “as quickly as possible.”

A second reading of the ordinance approving the project is slated for next week’s city council meeting. It’s unclear when a vote to approve the permit that planning commissioners rejected will go before the council, which is contingent on Lomas Partners filing an appeal.

The project is linked to the future of Petaluma’s second rail station and two other housing developments through a web of agreements held by landowner Lomas Partners, and is fixed to a rigid construction timeline, with the rail agency requiring funds to move forward in the next month.

The agreement between the company and rail agency provides SMART with the funds it needs to build the station through sale of its parcel of land situated behind the current downtown station. The downtown plot is set to host a complex of over 400 housing units, spearheaded by Texas-based developer Hines Company.

A 50-unit off-site affordable housing complex on Petaluma Boulevard South is also roped into the larger Corona Station development issue, proposed by Hines Company as a way to meet city-mandated affordable housing requirements.

Construction of the station is to cost $8 million, according to SMART, with the city kicking in $2 million of that total cost with funds from traffic impact fees per a 2016 decision. Kurtin said his contract with the rail agency is for $8 million, and he will contribute $6 million toward the station, leaving the city’s $2 million contribution to meet the required cost amount.

The city is currently pursuing an agreement with SMART over this contribution, looking to gain assurances from the rail agency and further tighten the screws on the complex domino-like agreements that will ultimately bring forward more than 500 new units of housing and a second rail station to Petaluma.

The city injected a clause within the development agreement that dictates the projects can be terminated if the city is unable to reach its own agreement with SMART over the city’s $2 million contribution to station construction and improvements.

However, the timing of the meeting following a sudden request for a second meeting rubbed some commissioners the wrong way, stirring preexisting feelings of mistrust and highlighting aspects of the 110-unit Corona Station development project that fall outside of the Planning Commission’s purview.

“I do have concerns with the CUP (permit), not only the lack of retail and what could have been,” commissioner Richard Marzo said. “But primarily that one of the conditions is a meeting that has yet to occur, which is a meeting between the city and SMART.” Marzo said.

Officials representing the city of Petaluma and SMART are schedule to resume talks Friday after an abrupt dissolution of a draft agreement two weeks ago that left city staff surprised.

(Contact Kathryn Palmer at kathryn.palmer@arguscourier.com, on Twitter @KathrynPlmr.)