Originally published: 10/28/07
I've never met Stan Thomas -- the Atlanta developer who hopes to remake Sacramento's downtown railyard -- but I bet he plays a mean game of poker.
Who else but a risk-taker would buy a 240-acre tract of land that holds enormous potential, but is largely inaccessible and blanketed with piles of toxic waste?
Who else would acquire this land after several other developers have publicly taken a pass on it? Who else would hinge development on obtaining $300 million in public subsidies in the first phase of the project, and $700 million for the remainder?
Who else would make this deal contingent on the city of Sacramento relocating a stretch of railroad track at a cost of at least $40 million?
Finally, who else but a Dixie poker player would pursue such a gamble knowing he had to deal with three wild cards: (1) The state of California. (2) The citizenry and leadership of California's capital. (3) A ruinous downturn in the housing market?
While developers rarely engender much empathy from this quarter, I must admit: I'm starting to feel some pathos for this card player. Not only is he taking on one of the nation's most difficult urban redevelopment projects, but he must contend with the narrative that the Golden State attaches to developers: All of them are evil.
Never mind that Thomas is undertaking a highly risky venture, as opposed to the relatively easy option of converting farm fields into subdivisions. Never mind that this company is actively cleaning up a toxic waste site that, if it were still owned by Union Pacific, would probably sit abandoned for decades.
And never mind that Sacramento may blow a rare chance to do what Portland did with its Pearl District and Denver did in its Lower Downtown Historic District, bringing a renaissance to downtown.
Ignore all that. If we stick with the chosen story line, Thomas must be cast as the mysterious "Georgia developer," as opposed to the reputable developers we have here in California. He must be accused of trampling on the city's history, by not immediately agreeing to cough up two buildings for a railroad technology museum. While we are at it, let's accuse him of seeking to pocket state bond money and turn the railyard into just another shopping mall.
To some degree, Thomas and his team have made it easy for critics to write this story line. A little over a week ago, the company and the city floated plans to exempt 12,000 housing units planned at the railyard from some of the city's affordable housing requirements. Among other things, Thomas wanted future developers to have the option of building low-income housing outside of the 240-acre site.
Thomas officials must have known that this request, coming so late in the game and after so much existing controversy, would enrage housing advocates. It did. The company then backtracked and withdrew the proposal Monday -- right before a joint meeting of the city's planning, design and historic preservation commissions. But it was too late. Advocates already had written their script and, at Monday's hearing, one accused Thomas of "wholesale larceny" and "arrogance."
Is the Thomas team arrogant?
Undoubtedly, they've left that impression at times. Yet if Thomas seems overly pushy, many community activists seem hopelessly naïve about the challenges of redeveloping a railyard.
Before a single building is built at this site, the city will first need to relocate existing railroad tracks so two elevated roads can be built over the rails to connect the site with downtown.
While the city engages in a costly, three-year federal review of the track relocation, Thomas officials will be working to secure some of the $300 million in public subsidies they say will be needed immediately for streets, sewers and other infrastructure. Some of this money could come from the $2.85 billion housing bond that voters approved last year. But big projects in Los Angeles and the Bay Area are competing for these funds, which is why Thomas is pushing so hard for quick permit approvals from the city.
"The hurdles are enormous," says Richard Rich, development director for Thomas Enterprises. Ultimately, he and other Thomas officials say, they hope to attract $10 in private investment for every public dollar spent. But the initial infrastructure money will be essential, they say, for leveraging private investors.
Given these challenges, should community activists just roll over and allow Thomas to do whatever it wants?
No, they need to be vigilant.
But a reality check would be helpful. On the most basic level, Thomas and company are engaged in a negotiation with the city. They are prodding and probing, seeing if they can extract concessions that will shave costs for their project. They also are constantly reassessing the viability of the project, given the realities of the current development market and the availability of private financing.
Such considerations appear to be a factor in the current dispute over a railroad technology museum.
Up until earlier this year, supporters of the California State Railroad Museum in Old Sac thought that Thomas would honor a letter of intent -- signed by the previous railyard suitor, Millennia Associates -- to hand over two historic buildings for the museum project.
But once Thomas took control of the railyard, Rich and Suheil Totah -- both of whom previously worked for Millennia -- started to take a hard look at the museum proposal, which involved not just one, but two large buildings at the railyard. Soon they were questioning assumptions about how many people the museum would draw and whether a museum would be the best use of both buildings.
Not surprisingly, railroad buffs have now branded the Thomas team as traitors. Feeling betrayed, they have been organizing and seeking allies that might be able to apply pressure on Thomas. These allies, it appears, include the California State Parks and the State Lands Commission, both of which can complicate Thomas' efforts to obtain needed entitlements.
There is no doubt that any redevelopment must honor the railyard's heritage as the western terminus of the transcontinental railroad and an industrial site that helped build the West.
The trouble, however, is the museum's current proposal has too limited of a script. The plans I've seen show one building devoted to refurbishing and painting old locomotives, with a separate main museum space featuring rail technologies of the past and future.
While such an interactive display could be exciting for kids and somewhat interesting for adults, the story needs to be broader. It needs to encompass the whole sweep of western expansion, and the role -- good and bad -- that the railroads and rail barons played in shaping the modern West. It needs to delve into the contributions of Chinese Americans, Hispanic Americans and other ethnic groups who worked on the railroad but were excluded from working in the shops. Several people made that point at a City Council meeting Tuesday.
Clearly, there's room for a compromise on the railroad museum. Yet as wise observers have suggested to me, that's probably the wrong way to frame the question.
The better question is: Instead of shrinking the vision to simply accommodate Thomas and rail buffs, can we think bigger and grander?
Can we go beyond the current narrowly focused proposals -- railroad museum, Pro Bass Shop, etc. -- and write a new story line for the railyard? Can we have an imagination that meets our mountains?
How about a museum of the West? Or, how about a college of fine arts or engineering that would bring the area a jolt of youthful vitality?
Undoubtedly, there are people who are harboring even better ideas than these. They haven't yet been heard from. The stakes at the railyard are too big to be dragged down by singular agendas and the normal course of business in Sacramento.
Is it too late to rewrite this script?
Call The Bee's Associate Editor Stuart Leavenworth, (916) 321-1185.
Upcoming meetings on the downtown railyard
* Nov. 7: Sacramento’s Preservation Commission meets to decide final recommendations on Historic District boundaries and other issues.
* Nov. 13: Planning Commission meets to consider the city finance agreement and the development agreement, and to make final recommendations to the Sacramento City Council.
* Nov. 14 or 15: Design Commission meets to make final recommendations on the railyard project.
* Nov. 20: City Council holds a public hearing and is scheduled to take final action on the Thomas Enterprises railyard development agreement and finance plan.