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World Logistics Center ProjectDraft Environmental Impact Report

Section 4.13 Population, Housing, and Employment 4.13-1

4.13 POPULATION, HOUSING, AND EMPLOYMENT

This section identifies population and housing conditions within the City of Moreno Valley andaddresses potential impacts that may result from the construction and operation of the proposed WLCproject. The analysis is based in part on population and housing projections identified by the

California Department of Finance (DOF), Southern California Association of Governments (SCAG),as well as information contained in the Citys General Plan.

For the readers reference, this EIR and each of the technical reports and analyses contained hereinhave been written to address a series of planning entitlements, which affect several separate,adjacent and related properties. The overall project site covers 3,918 acres in the Rancho Belagoarea of the City of Moreno Valley. It includes 3,814 acres of land, which is the subject of variousentitlements, plus 104 acres of land affected by off-site improvements needed to support theproposed development. The proposed entitlements are summarized below.

A General Plan Amendment is proposed covering 3,814 acres, which redesignates approximately 71percent of the area (2,710 acres) for logistics warehousing and the remaining 29 percent (1,104acres) for permanent open space and public facilities. The following elements of the General Plan are

included in the proposed Amendment: Community Development (land use); Circulation; Parks,Recreation, and Open Space; Safety; Conservation; and the General Plan Goals and Objectives.

A new Specific Plan will be adopted to govern development of the World Logistics Center for the2,710 acres. A separate zoning amendment will also be processed and adopted to rezone 1,104acres for open space and public facilities uses and to incorporate the Specific Plan into the CitysZoning Map.

In addition to the General Plan Amendment, Specific Plan, and Zone Change, the project includes aTentative Parcel Map covering 1,539 acres (property owned by the project applicant, HighlandFairview) within the project site. This subdivision map is for financing purposes only and will notconfer any development rights to the property owner.

The project includes pre-annexation zoning for an 85-acre parcel of land within the project area.

Finally, a Development Agreement between the City and Highland Fairview (the project applicant) isincluded as one of the project entitlements. The details of all the project entitlements are included inSection 3.4 of the EIR, Project Characteristics. The environmental impacts of all of these entitlementson the entire project area are addressed in this EIR and the accompanying technical reports andanalyses.

The analysis contained in this section is based in part on the following reference documents:

Fiscal and Economic Impact Study World Logistics Center Moreno Valley, California, DavidTaussig & Associates, Inc., January 15, 2013.

Moreno Valley Economic Development Strategy, John Husing, Ph.D., presentation to City Council

January 18, 2012. City of Moreno Valley Draft Housing Element 2008 2014, City of Moreno Valley, February 2011.

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4-13-2 Population, Housing, and Employment Section 4.13

4.13.1 Existing Setting

4.13.1.1 Population Characteristics

The U.S. Census as reported by the DOF estimates the Citys current (2011) population at 195,216persons.1 SCAG projections estimate the population of the City, Riverside County, and southernCalifornia (SCAG) regions will continue to grow. The SCAG projects the Citys population will grow to213,700 persons by the year 2020 and 255,200 persons by the year 2035 (Table 4.13.A).

Table 4.13.A: Population, Housing, and Employment Forecasts

2011 2020 2035

Population

City of Moreno Valley 195,216 213,700 255,200

Riverside County 2,217,778 2,592,000 3,324,000

SCAG 18,163,664 19,663,000 22,091,000

Housing Units


Riverside County 804,915 834,000 1,092,000SCAG 6,348,741 6,458,000 7,325,000

Employment


Riverside County 551,492 939,000 1,243,000

SCAG 7,224,670 8,414,000 9,441,0001

2011 Employment data for the City and County is based on the Fiscal and Economic Impact Study World Logistics CenterMoreno Valley, California, October 11, 2012.

Source: Draft 2012 RTP Growth Forecast, Southern California Association of Governments, http://www.scag.ca.gov/forecast/index.htm, date accessed March 15, 2012Table 2:City/County Population and Housing Estimates, 1/1/2011, State of California Department of FinanceTable 1: Population, Age and Sex Characteristics, April 1, 2010, Incorporated Cities and Census Designated Places (CDP) byCounty in California. State of California, Department of Finance, Sacramento, California, May 19, 2011.

4.13.1.2 Housing Characteristics

The number of housing units in the City has increased to accommodate the Citys growing population(Table 4.13.B). Currently, the DOF identifies that over three-quarters of the existing housing units inthe City are single-family detached units (Table 4.13.C). Multiple-unit dwellings compriseapproximately 16 percent of the Citys current housing stock.

Table 4.13.B: City of Moreno Valley Housing Units, 1990, 2000, and 2010

Year Housing Units Increase (%)

1990 37,945

2000 41,462 9.3

2010 51,592 24.41

City of Moreno Valley Draft Housing Element 2008 2014. City of Moreno Valley. February 2011.2 California Department of Finance: California State Data Center. Data derived from Housing Characteristics, 2000 Census

of Population and Housing

3Draft 2012 RFP Growth Forecast, Southern California Association of Governments, http://www.scag.ca.gov/forecast/index.htm, date accessed March 15, 2012.

1E-5 Population and Housing Estimates, for Cities, Counties, and the State, 20102011, with 2010 Benchmark, State ofCalifornia Department of Finance, http://www.dof.ca.gov/research/demographic/reports/estimates/e-5/2011-20/documents/E-5_2011_Internet_Version.xls, May 2011, website accessed March 22, 2012.

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Table 4.13.C: Composition of the Housing Stock, 2010

Housing Type

City of Moreno Valley

Number of Units Percentage

Single-Family, Detached 42,812 79.6%

Single-Family, Attached 1,105 2.0%

2- to 4-Unit Structure/ 5- or More Unit Structure 8,812 16.4

Mobile Home 1,043 2.0

Total 53,772 100%

Source: State of California, Department of Finance, E-5 Population and Housing Estimates for Cities, Counties and the State,20012010, with 2000 Benchmark. Sacramento, California, May 2010.

4.13.1.3 Employment Characteristics

As identified in Table 4.13.A, approximately 25,120 jobs were located within the City in 2011. Basedon available data from 2010 (SCAG 2010), the largest share of Moreno Valleys jobs were in the

education and health care sector (40.2%). The top four employment sectors, education and healthcare (40.2%), retail trade (18.2%), leisure/hospitality (10.9%), and professional and management(6.1%) accounted for three-fourths of jobs in the City. Table 4.13.D provides a breakdown of thepercentage by job type for the most recent available data (2010). The Husing Report presented to theCity Council in January 2012 also indicated that medical services and logistics were two of the fewemployment categories to show significant growth during the economic downturn starting in 2008(Husing 2012).

Table 4.13.D: City of Moreno Valley 2010 Employment Percentage by Sector

Job Sector Percentage of Employees

Education and Health Care 40.2%

Retail Trade 18.2%

Leisure/Hospitality 10.9%Professional and Management 6.1%

Public Administration 5.2%

Manufacturing 3.7%

Finance/Insurance/Real Estate 3.5%

Other Services 3.5%

Construction 3.3%

Transportation/Warehousing/Utilities 2.8%

Wholesale 1.6%

Information 0.7%

Agriculture 0.4%

TOTAL 100%Source: Profile of the City of Moreno Valley, Southern California Association of Governments, http://www.scag.ca.gov/resources/pdfs/2011LP/Riverside/MorenoValley.pdf, date accessed March 22, 2012.

The jobs-to-housing ratio measures the extent to which job opportunities in a given geographic areaare sufficient to meet the employment needs of area residents. This ratio identifies the number of jobsavailable in a given region compared to the number of housing units in the same region. For example,a region with a jobs-to-housing factor of 1.5 would indicate that 1.5 jobs exist for every housing unitwithin that region. The standard used for comparison is the jobs-to-housing ratio of the SCAG region,is currently 1.24 jobs for every household. This standard is used because most residents of the region

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are employed somewhere in the SCAG region. A City or sub-region with a jobs-to-housing ratio lowerthan the overall standard would be considered a jobs poor area, indicating that many of theresidents must commute to places of employment outside the sub-area. Table 4.13.E shows thecurrent and potential jobs/housing ratios for the City, Riverside County, and SCAG.

Table 4.13.E: Projected Future Jobs/Housing Ratios

2010 Jobs/Housing Ratio 2035 Jobs/Housing Ratio

City 0.45 0.88

Riverside County 0.73 1.14

SCAG 1.14 1.29

The 2010 estimated jobs-to-housing ratios for the City, County, and SCAG region are 0.45, 0.73, and1.14, respectively. The 2035 future jobs-to-housing ratios for the City, County, and SCAG region are0.88, 1.14, and 1.29, respectively. These ratios indicate that both Riverside County and the City ofMoreno Valley are jobs poor because the jobs-to-housing ratios are below the Southern Californiaregion (as defined by SCAG). The Husing Report presented to the City Council in January 2012indicated that the jobs to housing ratio for Southern California had actually declined from 1.25 to 1.04from 2007 to 2010 as a result of the economic downturn (Slide 7, Husing 2012).

A low jobs/housing ratio results in longer distances that residents of Moreno Valley must drive to andfrom work. This factor may contribute to the Citys property values which are currently about half ofthe regional average (Source: Profile of the City of Moreno Valley, SCAG, May 2011). For example,the median home sales price in Moreno Valley in 2010 was $155,000 compared to the regionalaverage of $291,000. One result of a jobs/housing imbalance is a weaker or lower tax base withwhich to support public services. The City also experiences a large leakage of potential sales taxrevenue due to the resident workers absence during workdays, as well as the lack of business andindustry taxes compared to other jurisdictions of similar size.

4.13.1.4 Economic Conditions

The Fiscal and Economic Impact Study World Logistics Center Moreno Valley, California (DavidTaussig & Associates, Inc., 2012) prepared for the proposed WLC project evaluates the likely fiscaland economic impacts of the proposed WLC project within the City. The purpose of the study is toestimate the net fiscal impacts of the proposed WLC project and construction of the project on theCitys General Fund. The fiscal impacts identified in the study include recurring municipal revenuesand costs to the City General Fund that result from the land use scenario analyzed. City GeneralFund revenues are generated from a variety of sources including property taxes, sales taxes, fees,and fines. Costs to the Citys General Fund are associated with a variety of services, such as policeprotection, fire protection, public works maintenance, and general government services. The studyalso identifies the general economic impacts on the City that would occur and quantifies theseimpacts wherever possible. General economic impacts include additions to the Citys employment,economic output, and earnings. The study also distinguishes between one-time impacts andpermanent impacts. One-time impacts include benefits to the City that occur on a non-recurring basisas a result of construction activity, while permanent impacts refer to benefits that occur on acontinuing basis, year after year. An examination of these conditions relative to potential population,housing and employment impacts is provided in Section 4.13.5.1, Population Growth.

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4.13.1.5 NOP/Scoping Comments

A representative of a conservation group and several individuals said the EIR should address the lossor transfer of 7,700 housing units from the Moreno Highlands Specific Plan to other locations in theCity. Some residents commented that fiscal commitments by the City on other local projects by this

developer have resulted in expenditures of funds that could otherwise have been used for Cityservices. It should be noted the analysis of this change was largely addressed in the updated (2011)Housing Element that recognized the Moreno Highlands Specific Plan would probably not be built.

4.13.2 Existing Policies and Regulations

4.13.2.1 Federal Regulations

The Federal Community Development Block Grant (CDBG) monies are part of Federal housingassistance programs at the local level. Housing and Urban Development (HUD) and CDGB moniesare a function of the potential change in the jobs and housing mix (http://www.hud.gov/offices/cpd/about/conplan/). The HUDs Office of Community and Planning Developments (CPDs) ConsolidatedPlan is designed to help states and local jurisdictions to assess their affordable housing andcommunity development needs and market conditions, and to make data-driven, place-basedinvestment decisions. The consolidated planning process serves as the framework for acommunitywide dialogue to identify housing and community development priorities that align andfocus funding from the four CPD formula block grant programs: the CDBG, the HOME InvestmentPartnership (HOME), the Emergency Solutions Grant (ESG) program, and the Housing Opportunitiesfor Persons with AIDS (HOPWA) program.

CPD Maps is an online data mapping tool for place-based planning. Grantees and the public can useCPD Maps to analyze and compare housing and economic conditions across their jurisdictions. TheCPD Maps tool is publicly available, giving all community stakeholders access to the same data. TheConsolidated Plan template allows grantees to insert maps and data tables from CPD Maps withease, throughout their plans.

4.13.2.2 State Regulations

The Regional Housing Needs Assessment (RHNA) is mandated by State Housing Law as part of theperiodic process of updating local housing elements of the General Plan. The RHNA quantifies theneed for housing within each jurisdiction during specified planning periods. The most recentlycompleted RHNA planning period is January 1, 2006, to June 30, 2014. Due to the requirements ofSB 375, SCAG is preparing the next RHNA planning cycle, which will cover October 1, 2013, toSeptember 30, 2021.

4.13.2.3 Regional and Local Regulations

County of Riverside Housing and Land Use Policies. The Housing Element is one of the sevenGeneral Plan elements mandated by the State of California as articulated in Sections 65580 and

65589.8 of the Government Code. Each city and county is required to discuss how it will meet its fairshare of the housing need in the State.

The County of Riverside has a relevant policy in the Land Use Element of the County General Plan.To support future growth of the population and housing stock in the County of Riverside, the LandUse Element contains policies to ensure adequate utilities for new development (County of Riverside2003). Specifically the policy LU 1.6 statesCoordinate with local agencies, such as the LocalAgency Formation Commission (LAFCo), service providers, and utilities to ensure adequate serviceprovision for new development.

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City of Moreno Valley General Plan. The Citys General Plan Chapter 9 (Goals and Objectives)establishes goals and objectives to guide the development, redevelopment, and preservation of abalanced housing inventory within the City. Specific policies relevant to the proposed WLC projectinclude:

Objective 2.5 Promote a mix of industrial uses which provides a sound and diversified economicbase and ample employment opportunities for the citizens of Moreno Valley with theestablishment of industrial activities that have good access to the regionaltransportation system, accommodate the personal needs of workers and businessvisitors; and which meets the service needs of local businesses.

Goal 2.2 An organized, well-designed, high quality, and functional balance of urban and ruralland uses that will meet the needs of a diverse population, and promote the optimumdegree of health, safety, well-being, and beauty for all areas of the community, whilemaintaining a sound economic base.

Goal 2.4 A supply of housing in sufficient numbers suitable to meet the diverse needs of futureresidents and to support healthy economic development without creating an

oversupply of any particular type of housing.

4.13.3 Methodology

To determine the potential for impacts related to population and housing, the current uses, overallcondition of the project site, historic and current population and housing characteristics, and futureprojections for population, housing, and employment were identified. This analysis is based on datapublished by the DOF and SCAG, as well as information presented in the Citys General Plan and theCounty of Riverside General Plan.

As identified in the study prepared by David Taussig & Associates, Inc. (DTA), fiscal impacts arisingfrom a land development project can be broadly categorized as one of two types: one-time andrecurring impacts. Each of these broad types can be divided into a revenue component and a costcomponent. The study assumes that one-time revenues would directly offset one-time costs;therefore, the fiscal impacts considered focus on ongoing, or recurring, fiscal impacts of the proposedWLC project on the Citys General Fund. Revenues generated outside of the Citys General Fund(e.g., special district revenue) or costs incurred by the City outside of the General Fund (e.g., costsfinanced through a special district) are not included in this analysis.

This methodology involves calculating the average citywide revenues/costs per Persons Served,1

utilizing the fiscal year 20122013 City budget, and applying these revenue/cost factors to thespecific number of Persons Served projected for the proposed WLC project. For analysis purposes,all recurring revenues and costs are stated in constant (uninflated) 2012 dollars based on theassumption that the relative impacts of inflation in future years will be the same for both of these fiscalimpact categories.

Direct economic impacts reflect the initial or first-round increases in jobs, earnings, and output, all ofwhich occur directly on site. Indirect/induced economic impacts are the secondary and otheradditional rounds of economic activity that occur as a consequence of the direct impacts, and canoccur elsewhere within the city. The indirect impacts represent the economic activity (buying andselling of goods and services) of suppliers to the proposed land uses. The induced impacts representthe economic activity that results from household spending by employees of all companies directlyand indirectly affected by the construction and operation of the proposed WLC project. The study

1A service population comprising all residents and 50% of employees.

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estimated the number of direct employees in the proposed WLC project based upon an averageemployee per square foot ratio for similar land uses in the region. Additionally, all economic impactsare stated in constant (uninflated) 2012 dollars, based on the assumption that the relative impacts ofinflation in future years may be difficult to gauge.

4.13.4 Thresholds of Significance

The following thresholds of significance regarding potential impacts related to population and housingare based on CEQA Guidelines(2011). A project would have a significant impact on population andhousing if it would:

Induce substantial population growth in an area, either directly (for example, by proposing newhomes and businesses) or indirectly (for example, through extension of roads or otherinfrastructure);

Induce substantial population growth in an area, either directly (for example, by proposing newhomes and businesses) or indirectly (for example, through extension of roads or otherinfrastructure) that may lead to fiscal or economic impacts;

Displace substantial numbers of existing housing, necessitating the construction of replacementhousing elsewhere; and/or

Displace substantial numbers of people, necessitating the construction of replacement housingelsewhere.

4.13.5 No Impact/Less Than Significant Impacts

4.13.5.1 Population Growth

Threshold Would the proposed WLC project induce substantial population growth in an area,either directly (e.g., new homes and businesses) or indirectly (e.g., extension ofroads and infrastructure)?

Would the proposed WLC project induce substantial population growth in an area,either directly (e.g., new homes and businesses) or indirectly (e.g., extension ofroads and infrastructure) that may lead to fiscal or economic impacts?

Growth-Related Impacts. CEQA requires a discussion of ways in which the proposed WLC projectcould be growth inducing (see also Section 5.0, Other CEQA Topics). The CEQA Guidelinesidentifya project as growth inducing if it fosters economic or population growth, or the construction ofadditional housing either directly or indirectly in the surrounding environment (CEQA GuidelinesSection 15126.2[d]). New employees from commercial or industrial development and new populationfrom residential development represent direct forms of growth. These direct forms of growth have asecondary effect of expanding the size of local markets and inducing additional economic activity inthe area.

A project could indirectly induce growth by reducing or removing barriers to growth, or by creating acondition that attracts additional population or new economic activity. However, a projects potential toinduce growth does not automatically result in growth. Growth can only happen through capitalinvestment in new economic opportunities by the private or public sectors. Under CEQA, growthinducement is not considered necessarily detrimental, beneficial, or of little significance to theenvironment. Typically, the growth-inducing potential of a project would be considered substantial if itfosters growth or a concentration of population in excess of what is assumed in pertinent masterplans, land use plans, or in projections made by regional planning agencies (e.g., SCAG). Substantialgrowth impacts could also occur if a project provides infrastructure or service capacity to

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accommodate growth beyond the levels currently permitted by local or regional plans and policies. Ingeneral, growth induced by a project is considered a significant impact if it directly or indirectly affectsthe ability of agencies to provide needed public services, or if it can be demonstrated that thepotential growth significantly affects the environment in some other way.

A project could indirectly induce growth at the local level by increasing the demand for additionalgoods and services associated with the increase in project population and thus reducing or removingthe barriers to growth. This occurs in suburban or rural areas where population growth results inincreased demand for service and commodity markets responding to the new population. This type ofgrowth is, however, a regional phenomenon resulting from introduction of a major employment centeror regionally significant housing project. Additional commercial uses may be drawn to the area by theincreased number of residents in the area as a result of a project; however, it is expected that anysuch development would occur consistent with planned growth identified in the General Plan orapplicable specific plans.

As shown in previously referenced Tables 4.13.A and 4.13.B, the Citys population has grown steadilyover the past decades. Population projections developed by SCAG estimate the Citys population willreach approximately 213,700 persons by the year 2020 and approximately 255,200 persons by the

year 2035.

The extent to which the new jobs created by a project are filled by existing residents is a factor thattends to reduce the growth-inducing effect of a project. Construction of the proposed WLC project willcreate short-term construction jobs. These short-term positions are anticipated to be filled by workerswho, for the most part, reside in the project area; therefore, construction of the proposed WLC projectwill not generate a permanent increase in population within the project area. Development envisionedunder the proposed WLCSP consists of approximately 41.6 million square feet of logistics warehouseand general warehouse facilities.

An economic study of the project prepared by DTA concluded that the proposed WLC project couldgenerate up to 24,642 new on-site jobs within the City.1 In addition to the projected on-site jobcreation, the DTA study estimates the proposed WLC project could generate new off-site jobs (i.e.,

indirect/induced employment) in all industries of the economy. The DTA study also estimated that anadditional 7,583 indirect/induced jobs could be created in the County, of which 3,792 jobs wereprojected to be within the City as a result of project implementation. This estimate is derived from theImpact Analysis for Planning (IMPLAN) Input/Output Modeling System, which is a quantitativeeconomic model that provides an approximate measure of the multiplier effect of a firms spendingon payroll and purchase of goods and services. While the specific location of the potential additionalindirect/induced jobs created within the County cannot be specifically determined, it is reasonable toassume that a large percentage of these jobs will be support service jobs and are likely to be locatedin the proposed WLC project vicinity, and therefore the City.

The WLC project does not include a residential component. The proposed WLC project is locatedwithin an area that is currently largely vacant and planned for mix of residential, commercial, businesspark, and open space land uses in accordance with the General Plan Community DevelopmentElement. The proposed WLC project includes a General Plan Amendment to change the existing mixof land use designations to Logistics Development and Light Logistics.

If approved, the WLCSP would supplant the approved Moreno Highlands Specific Plan (MHSP)project that did have a residential component. The EIR for that project indicated it would haveincreased the Citys population by 17,019 persons over 15 years (7,736 units 2.2 persons/unit).However, because the City is considered housing rich (and jobs poor) by SCAG, the loss of that

1Fiscal and Economic Impact Study World Logistics Center Moreno Valley, California (David Taussig & Associates, Inc.,October 11, 2012.

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projected population growth is not considered a significant impact and, in fact, a number of Statepolicies (e.g., SB 375) encourage the creation and development of jobs-producing development inareas with poor jobs/housing numbers such as that which exists in the City.

Most of the site has been used for dry farming since the early 1900s and much of the proposed WLC

project site continues to be used for dry farming at the present time. Currently, there are seven single-family homes in various locations on the property along with associated ranch/farm buildings. Streets,water and sewer utilities, and municipal services would be extended to serve the proposed WLCproject. The proposed WLC project may benefit other development projects in the project area by theinstallation of infrastructure (e.g., roads and utilities), but is not expected to induce substantialpopulation growth into the area since there would be no large areas of vacant land left in the east endof the City (south of SR-60) that could be developed with residential uses.

Development of high-cube logistics warehouse and general warehouse facilities will create jobs in thelocal economy. However, it is difficult to predict exactly how many new jobs would be generated bythe proposed WLCSP. One concern expressed during the NOP/scoping period was the amount ofnew employment that would actually be generated by the WLC project. Table 4.13.F provides severalsources for estimating potential new employment for the proposed project, which could range from

13,714 to 24,642, depending on what data source is selected to predict future employment within theWLCSP.

Table 4.13.F: Employment Estimates for the WLCSP

Source/Project(Jurisdiction)

Source Ratio(jobs/ft

2)

Square Feet/Employee

Square Feet ofBuilding

ProjectedJobs

World Logistics Center SpecificPlan (City of Moreno Valley)

0.5:1,000 2,000:1 41,620,000 24,642

WLCSP Traffic Study(City of Moreno Valley)

500:1,000,000 2,000:1 41,600,000 20,800

Stratford Ranch(City of Perris)

2,500:1 2,500:1 1,712,880 685

Skechers 600:1,820,000 3,033:1 1,820,000 13,714Husing Logistics Report(City of Moreno Valley)

1,903:1 1,906:1 NA NA

Vogel Industrial Project(City of Moreno Valley)

2,500:1 2,500:1 1,616,133 646

1 DTA Public Works Database; confirmed by Employment Density Study, SCAG (2001), and Logistics Trends andSpecific Industries, NAIOP Research Foundation (March 20110).

2Extrapolation based on conversion of ITE square footage/land use rates into employment generation.

3Inland Empire Distribution Center Operations Profile, WCL Consulting, June 10, 2008. 2,500 square feet per employee isan average of the Inland Empire rates.

4 Actual data from City of Moreno Valley Planning Department and Highland Fairview.5

From Husing report to the City Council in January 2012 based on 2003 study by U.S. Energy Information Agency shippingand distribution centers increase by 5% making it 1 employee/ 2,000 square feet.

6Inland Empire Distribution Center Operations Profile, WCL Consulting, June 10, 2008. 2,500 square feet per employee isan average of the Inland Empire rates.

It should be understood that the actual eventual number of employees generated by the project couldvary from under 15,000 to almost 25,000 employees, depending on a variety of economic factors(e.g., actual companies that relocate and current hiring conditions). This estimate also does not takeinto account relocation of existing employees from other jurisdictions as a result of existingbusinesses relocating into the WLC project. However, these would be counted as new employeesfor the City of Moreno Valley. For the purposes of this analysis, the EIR will use 24,642 employees orone employee per 2,000 square feet as a worst-case estimate (in terms of environmental impacts)for future employment growth from WLCSP development. However, Table 4.13.F indicates that actualemployment generated by the project may be as low as 13,714 employees, based on current

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employment at the nearby Skechers facility. It should be noted the Skechers employment numbersmay be low due to currently poor economic conditions in the region and higher employment numbersshould also be seen as a positive in terms of benefits to the economy and City residents, in additionto representing a worst-case condition relative to environmental impacts. The DTA fiscal impactstudy prepared for the project also indicated WLC could also induce an additional 3,792 indirect and

induced jobs into the community (in addition to the 24,642 direct jobs). In addition, Skechers is justone warehouse project, and the following information uses a variety of warehousing projects toestimate employment generation.

The new employment opportunities resulting from development of the proposed high-cube logisticswarehouse and general warehouse uses will raise the Citys current jobs-to-housing ratio by providingadditional jobs to local residents. While the place of residence of the persons accepting employmentprovided by the proposed uses is uncertain, due to the Citys projected jobs/housing ratio, it isreasonable to assume and therefore expect that a large percentage of these jobs would be filled bypersons already living within the City or project area. Therefore, no significant increase in populationof the City would result from the development or operation of the proposed WLC project, resulting in aless than significant impact associated with growth inducement and no mitigation is required.

The second threshold for significance is Would the proposed WLC project induce substantialpopulation growth in an area, either directly (e.g., new homes and businesses) or indirectly (e.g.,extension of roads and infrastructure) that may lead to fiscal or economic impacts? In that regard,the following provides an analysis of the projected fiscal effects of the proposed WLCSP project.

Indirect City Population Impacts Related to Fiscal and Economic Changes. If the MHSP projectis not built, it could be argued the City may experience a financial impact from the loss of property tax,sales tax, and other revenues related to growth and development. The following analysisdemonstrates that the City will benefit financially by employment and development of logisticswarehousing as a result of the WLCSP project.

As detailed in the DTA study, recurring municipal revenues available to the City include those listed in

Table 4.13.G. Total recurring revenues available to the City are estimated at approximately$11,608,939 per year. As shown in Table 4.13.G, the greatest percentage of revenue is attributed tothe Property Tax In-Lieu of Vehicle License Fee (40.00%), followed by Secured Property Tax(28.9%), and Business Receipts Tax and Licenses (10.7%).

Table 4.13.G: Recurring Fiscal Revenues City of Moreno Valley (City General Fund)

Source Amount Percent

Property Tax In-Lieu of Vehicle License Fee $4,641,148 40.0%

Secured Property Tax $3,360,168 28.9%

Business Receipts Tax & Licenses $1,243,286 10.7%

Tax Revenues (UUT & TOT) $623,936 5.4%

Indirect Sales Tax $434,480 3.7%

Charges for Services $397,401 3.4%

Unsecured Property Tax $336,017 2.9%

Franchises $258,644 2.2%

Property Transfer Tax $103,070 0.9%

Intergovernmental Revenues $62,550 0.5%

Licenses/Permits $59,318 0.5%

Direct Sales Tax $40,000 0.3%

Investment Income $23,172 0.2%

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Table 4.13.G: Recurring Fiscal Revenues City of Moreno Valley (City General Fund)


Other Revenues $12,614 0.1%

Fines and Forfeitures $6,672 0.1%

Transfers In $3,857 0.0%

Use of Money & Property $2,606 0.0%

Motor Vehicle Licensing Fees $0 0.0%

Total $11,608,939 100.0%1 Numbers may not sum correctly due to rounding to the nearest hundredth.Source: Table 3A, Fiscal and Economic Impact Study World Logistics Center Moreno Valley, David Taussig and Associates,October 11, 2012.

Recurring municipal services costs to the City include those listed in Table 4.13.H. Total recurringcosts to the City are estimated at approximately $5,568,409 per year. As shown in Table 4.13.H, thegreatest percentage of cost is attributed to the Police Services (36.7%), followed by Infrastructure andParks Maintenance Costs (32.6%), and Fire Services (13.6%).

Table 4.13.H: Recurring Fiscal Costs City of Moreno Valley (City General Fund)


Police $2,045,385 36.7%

Infrastructure & Parks Maintenance Costs $1,817,836 32.6%

Fire Services $759,357 13.6%

General Government $392,471 7.0%

Development Services $217,570 3.9%

Public Works $112,486 2.0%

Transfers Out $65,469 1.2%

Other Uses $65,365 1.2%

Animal Services $48,998 0.9%Community Development $43,472 0.8%

Total $5,568,409 100.00%1

Numbers may not sum correctly due to rounding to the nearest hundredth.Source: Table 3B, Fiscal and Economic Impact Study World Logistics Center Moreno Valley, David Taussig and AssociatesOctober 11, 2012.

Table 4.13.I provides an overall summary of the fiscal impact to the City based on projected revenuesgenerated by the proposed WLC project. As shown in Table 4.13.I, project recurring annual fiscalsurplus that would be available to the City is estimated at $6,040,530, which is equal to 2.08 times theproject annual City General Fund costs.

Table 4.13.I: Net Fiscal Impact City of Moreno Valley (City General Fund)

Category Amount

Total Recurring Revenues $11,608,939

Total Recurring Costs $5,568,409

Annual Recurring Surplus/(Deficit) $6,040,530

Total Annual Revenue/Cost Ratio 2.08

Source: Table 3B, Fiscal and Economic Impact Study World Logistics Center Moreno Valley, David Taussig and AssociatesOctober 11, 2012.

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Table 4.13.J presents the project characteristics that are the basis for the fiscal impact assessment.The locations of the additional indirect jobs that will be created within the County cannot bespecifically determined; however, a large percentage of these jobs will be support service jobs andare likely to be located in the general project vicinity. Based on experience with similar types ofprojects, DTA estimated that half of these indirect jobs would be located within the City. The study

also considers Total Output (i.e., total expenditures including sales or gross receipts, or otheroperating income) based on the different types of development projected to occur. For gross receipts,the study considers the initial or first-round increase in output (e.g., total spending/gross receipts,including payroll), all of which would occur directly on site. Indirect impacts represent the economicactivity of supplier and/or supporting businesses. Induced impacts represent the economic activitythat results from household spending by employees that may result from direct and directemployment generation of the proposed WLC project.

4.13.J: Project-Related Economic Characteristics

Land Use Assumptions Square Feet

Logistics 41,600,000

Employment Assumptions Employees Per 1,000 Square Feet

Logistics 0.50Wage Assumptions Annual $

Warehousing/Transportation (Logistics) $42,341

Construction $48,825

Riverside County Average (2010) $40,6021 Source: DTA Public Works Database; confirmed by Employment Density Study, SCAG (2001), and Logistics Trends

and Specific Industries, NAIOP Research Foundation (March 20110).2

Source: U.S. Census Bureau, Longitudinal Employer-Household Dynamics Reports (California, 2010) for Riverside-SanBernardino-Ontario Metropolitan Area and Riverside County; confirmed by Bureau of Labor Statistics (May 2010).

3 Standard Warehousing/Transportation Salary ($41,229) plus a small salary increase for 10% of employees to account forpresence of high-level management and related office personnel.

Source: Table 4A, Fiscal and Economic Impact Study World Logistics Center Moreno Valley, David Taussig and AssociatesOctober 11, 2012.

As previously noted, potential economic impacts that may occur with project implementation includepermanent employment (direct on site and indirect/induced), permanent output (gross receipts; totaldirect output plus output produced by suppliers and employee spending), and one-time constructionimpacts. Table 4.13.K summarizes the permanent (recurring) employment, wage, and gross receiptsvalues associated with the proposed WLC project.

Table 4.13.K: Project Permanent (Recurring) Employment, Wages ,and Gross Receipts

Recurring Impact Direct Indirect/Induced Total

Employees

Countywide 20,850 7,583 28,433

Within City 20,850 3,792 24,642

Employee WagesCountywide $882 Million $308 Million $1.2 Billion

Within City $882 Million $154 Million $1.0 Billion

Overall Output

Countywide $1.5 Billion $893 Million $2.4 Billion

Within City $1.5 Billion $447 Million $2.0 Billion

Source: Tables 4B and 4C, Fiscal and Economic Impact Study World Logistics Center Moreno Valley, David Taussig andAssociates October 11, 2012.

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The DTA study indicates that the creation of new jobs to the City will lead to more consumer spendingby employees in existing retail establishments within the City, as well as new retail development thatwill be attracted to the City as a result of this spending. Job creation also results in increased taxrevenues to the City through increased property taxes and sales taxes associated with developmentof the proposed WLC project. However, it is important to note that because of the difference in timing

of the development of the various phases of the proposed WLC project, the number of employeessummarized above will not be realized at the same time.

Table 4.13.L summarizes the construction (one-time) employment, wages, and gross receipts valuesassociated with the proposed WLC project.

Table 4.13.L: Project Construction (One-Time) Employment, Wages and Gross Receipts

Recurring Impact Direct Indirect/Induced Total

Construction Employees

Countywide 13,128 7,613 20,741

Within City 13,128 3,807 16,935

Construction Wages

Countywide $641 Million $309 Million $950 Million

Within City $641 Million $155 Million $796 Million

Construction Wages

Countywide $1.7 Billion $955 Million $2.7 Billion

Within City $1.7 Billion $478 Million $2.2 Billion

Source: Tables 4D and 4E Fiscal and Economic Impact Study World Logistics Center Moreno Valley, California, David Taussigand Associates, October 11, 2012.

As summarized in Table 4.13.L, development of the proposed WLC project is projected to createapproximately 16,935 construction-related full-time equivalent (FTE) jobs within the City. Similar torecurring employment (i.e., permanent), it is likely that a large percentage of these jobs will beassociated with support services and are likely to be located in the vicinity of the proposed WLC

project and therefore within the City.

The proposed WLC project does not include a residential component, so it would not directlygenerate additional new housing. Employees of the project that choose to live in the City would likelyutilize the existing supply of housing within the City.

Based on the potential increase in jobs (additional 24,642 direct jobs) within the City and nosubstantial increase in population as a result of the project, the Citys jobs-to-housing ratio wouldimprove from the existing (2010) ratio of 0.45 to 1.02, thus achieving a greater jobs-to-housingbalance within the City. Similarly, the potential new County employees that may be generated by theproposed WLC project would increase the total County employment to 585,531 from 551,492resulting in a ratio of 0.75 from 0.70.

As development of the proposed WLC project is expected to occur over the course of many years,the jobs-to-housing ratio will not significantly change immediately. The Citys current jobs-to-housingratio is exceptionally low when compared to SCAG standards; therefore, the need for employment isimmediate. A balance between jobs and housing within the City would have a positive impact bydecreasing costs associated with commuting and traffic congestion. It also provides savings toconsumers in the operation and maintenance of automobiles, and saving to local public agencies interms of the need to construct and maintain new road improvements.

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Summary of Impacts. Based on the foregoing discussion and as evidenced in Tables 4.13.I, 4.13.K,and 4.13.L, implementation of the proposed WLC project would not result in a deficit in the CitysGeneral Fund. The estimated surplus is $6,040,530, which is equal to 2.08 times the projected annualCity General Fund costs. Additionally, the proposed WLC project is expected to generate sizeable,substantial, and lasting employment, wages, output, and revenues for the City and region. Therefore,

potential fiscal and economic changes that could affect the Citys population or housing areconsidered to be less than significant, and no mitigation is required.

4.13.5.2 Displace Substantial Housing/People

Threshold Would the proposed WLC project displace substantial numbers of people or existinghousing, necessitating the construction of replacement housing elsewhere?

Displace Existing People/Housing. The WLC project site currently contains seven rural residences.At the City Council meeting on May 22, 2012, some of the existing residents stated that they did notwant to be included in the Specific Plan. After deliberation, the Council decided to include the ruralproperties in the Specific Plan in the interest of comprehensive land planning for the WLC property.

Upon approval of the Specific Plan, these properties can continue as non-conforming uses, and theWLC Specific Plan designates these properties as Light Logistics (LL), which allows for futureindustrial-related uses (vehicle storage, light assembly, etc.). In this way, the WLCSP will not removeor displace any of the existing residents or residences from the project site. As large warehousebuildings are developed near or adjacent to these residences, it may become less desirable to residewithin the WLCSP area; however, the project itself does not cause housing displacement.

Therefore, impacts to the seven on-site residences would not be considered a significant housingimpact. For these reasons, the WLCSP will not have significant population or housing impacts relatedto displacing substantial numbers of people or existing housing.

Displace Potential Future People/Housing. The City of Moreno Valley has been housing rich formany years, with much more housing stock than jobs according to data available from the SCAG. Inaddition, the recent economic downturn and related foreclosure/short sale conditions have leftMoreno Valley, as with many housing rich communities, with an overabundance of housing stock.Section 4.10, Land Use and Planning, examines the potential environmental impacts related to theloss of 388 affordable housing units from the MHSP, as outlined in the Citys 2011 HousingElement. The Element acknowledges that the MHSP property may have to be used for employment-generating uses, and that land use changes with the Moreno Highlands Specific Plan area will nothinder the Citys ability to meet its RHNA obligations.

1The 2011 Housing Element therefore

documents that the City has an abundant supply of housing and can meet its RHNA requirementswithout relying on any units from the MHSP.

During the NOP/scoping process, several residents commented that development of the proposedWLCSP would result in the loss of 7,700 housing units from the project site that would have to bemade up elsewhere in the City. The 2006 City Housing Element identified a potential for 5,240 units

of the potential 7,700 housing units in the Moreno Highlands Specific Plan. However, an updatedHousing Element adopted by the City in February 2011 indicated the Moreno Highlands area wouldbe rezoned to support employment-generating uses rather than housing. It also concluded thatpursuing any land use changes with the Moreno Highlands Specific Plan area will not hinder theCitys ability to meet its RHNA obligations. The term RHNA refers to the Regional Housing NeedsAllocation (affordable housing allocations) from the SCAG.

1Page 41, City of Moreno Valley Housing Element, February 2, 2011.

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Table 8-19.5 in the 2011 Housing Element states that after removing sites south of SR 60 and east ofRedlands Boulevard, the Amended Inventory throughout the City west of Redlands accommodates:

4,100 Low and Very Low Income units, which is 1.3 times the RHNA number (3,045) (deletingsites south of SR-60 and east of Redlands Boulevard has no effect on low and very low income

housing opportunities); 2,600 Moderate Income units, which is 2.1 times the RHNA number (1,239);

7,828 Above Moderate Income units, which is 2.5 times the RHNA number (3,068); and

14,528 total identified units, which is 1.94 times the total RHNA number (7,474).

Therefore, removal of the 388 affordable units originally identified in the MHSP (Table 8-19, page 40of the Housing Element), including 233 Very Low and 155 Low units, will not have a significantimpact on the Citys Housing Element or its ability to achieve its RHNA allocation.

The State Housing and Community Development Department (HCD) certified the Citys HousingElement as compliant with State law on May 31, 2011. This State HCD certification reinforces theconclusion that approval of the proposed project will not impede the Citys housing goals as set forth

in the Citys Housing Element.

In April 2011, the City adopted its Economic Development Action Plan, which also identified theeastern part of the City as a potential area for major job-producing land uses. The Fiscal andEconomic Impact Study World Logistics Center Moreno Valley, California (Study) prepared by DTAin 2012 concluded that the proposed WLC project would generate 24,642 direct jobs/employees tothe City. Section 4.10.5.3 determined that the proposed WLC project is consistent with the 2011Housing Element, and it will not displace substantial numbers of existing housing or necessitate theconstruction of replacement housing elsewhere. Therefore, no significant displacement impactsrelative to people or housing are expected to occur, and no mitigation is required.

4.13.6 Significant Impacts

Based on the analysis in Section 4.13.5, the WLC project will not have any significant impacts relativeto population, housing, or employment. Therefore, no mitigation is required.

4.13.7 Cumulative Impacts

The cumulative area for the discussion of population and housing impacts is the City of MorenoValley. The proposed WLC project would require a General Plan Amendment and Zone Change tore-designate the site from a mix of land uses and zoning designations to Logistics Development andPublic Utility land uses and a Specific Plan zoning designation. The project would not contribute tosubstantial population growth and therefore would not result in an increased demand on the currentor future housing in the region. In addition, the Moreno Valley area is considered housing rich andjobs poor by SCAG, so the loss of population (and planned housing) would actually be a regional

benefit according to the Regional Transportation Plan. The project may result in an influx of newworkers who would need to locate temporarily or permanently in the area, but the City has anoverabundance of existing housing stock due to current market conditions. Implementation of theproposed WLC project would actually benefit population and housing conditions relative toemployment and jobs/housing ratio and, therefore, not result in cumulatively adverse impacts topopulation or housing. The WLC project would also not significantly induce growth into areas wheregrowth was not previously anticipated since the WLC project area represents the last largestremaining vacant land in the City of Moreno Valley.

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