Water tank could grow downtown Fresno housing

Published online on Monday, Sep. 21, 2009

Six months ago, the 3.6-acre lot on H Street north of the Monterey Street bridge was the site of a large homeless encampment.

Now it is destined for a key piece of infrastructure — a large water tank — intended to open the door to more new housing construction downtown.

City officials expect to complete their $643,000 purchase of the lot from the Union Pacific Railroad next month. In early 2011, they plan to start construction on a tank to hold three million gallons of water. The tank will be filled at night to boost water supplies in daytime.

Also part of the project is a new pipeline reaching two miles from there to a well near Olive Avenue and Highway 99. So are upgrades to water lines in the Uptown area.

It’s all designed to make sure there’s enough water to put out fires as more people and bigger buildings come to the area. But one of downtown’s busiest developers says the city is asking builders to pay too much of the cost.

“We inspected the fire hydrants in the vicinity of our projects, and we found ample water pressure,” said Darius Assemi, who said his company has been asked to pay for a new well and several blocks of new water lines for some of its projects.

Those costs run well into six figures, city officials said. Assistant Public Utilities Director Lon Martin said the city will reimburse the builder for most of them, but many details remain under negotiation and the builder remains nervous.

Martin describes downtown’s water issues as two-fold. First, the district’s aging wells can’t pump enough water to keep pressure up. Second, especially north of Tuolumne Street, many of water lines are only six inches in diameter, too small to meet current flow standards for firefighting.

“We do presently experience water pressure problems [downtown] in July,” when annual water demands are at their peak, Martin said.

In addition, city officials want to be careful how much water they pump downtown because of ground-water contamination south of Church Avenue.

The contaminants — including the solvent PCE, the pesticide DBCP, and nitrates, which originate in fertilizers and animal wastes — could be drawn into downtown wells if they are used too heavily, Martin said.

Builders don’t dispute that downtown’s water system will need upgrades to support more new housing in the long run, Building Industry Association president and chief executive officer Michael Prandini said. But they say forcing them to pay too much of the cost could sink their projects.

“The problem with housing downtown is it’s already more expensive to build,” Prandini said, “and if you add significant infrastructure costs on top of that, nothing will ever get built.”

At Fulton and Amador streets, Assemi’s Granville Homes is planning three stories of shops and apartments. The company is also partners in several other small downtown housing projects built by Assemi’s nephew Reza.

Projects like those are less profitable from the outset than large suburban tracts or shopping centers, Prandini said.

“To ask one developer up front to pay a half million dollars for a new well makes a small project unfeasible,” he said.

Marlene Murphey, executive director of the city Redevelopment Agency, echoed that.

“Thus far, projects downtown have not been able to get market-rate returns, and increasing the infrastructure costs is likely to increase that gap,” Murphey said.

At this time, the new water tank and pipeline on the H Street site are scheduled to be financed by the city’s current utility rates. But that may change. Martin said the city may set up a system of developer fees to help with the cost.

Assistant City Manager Bruce Rudd said the City Council is likely to be asked soon to review measures to spur downtown development. They will probably include options for recouping costs of the water tank and pipeline, he said.

“Given our focus on downtown development, how do we do that without burdening developers?” Rudd said. “We’re looking at ways to mitigate that cost.”

Meanwhile, on Thursday the council approved an environmental report on the tank project. That starts a 30-day comment period, after which the city can take possession of the property.

About the same time, the city plans to remove lingering traces of the homeless encampment that once occupied the site.

Most of the camp’s occupants were resettled into subsidized apartments by mid-July, but a federal court order bars the city from removing their possessions until 90 days have elapsed, said Gregory Barfield, the city’s homeless prevention and policy manager.

“Beginning sometime that following week, community sanitation crews will remove whatever items are left over,” Barfield said.

After that, Martin said, the tank’s design and other details will be firmed up, aiming toward construction in early 2011 and completion of both the tank and pipeline by May 2012.