Two longtime south Fresno businesses appear to have dodged a bullet that would have rezoned their industrial properties to office use.

The city’s planning commission on Wednesday approved a new community specific plan setting land use goals for parts of south Fresno, but business advocates say property owners have been left out of discussions that affect their land.

The Central Southeast Area Specific Plan establishes zoning, transportation and infrastructure standards for Fresno near the Kings Canyon corridor from Orange to Peach avenues between Belmont and Church avenues.

The plan outlines how streets will look with new bike lanes, wider sidewalks and more green space to promote clean neighborhoods primed for growth.

It prioritizes new retail and health care for the 2,200 acres and 30,000 people in the plan boundaries.

But worries about the impacts of industrial businesses has led to two companies being shuffled among different city maps with the land they operate on hanging in the balance.

Donaghy Sales, Hormel Foods Faced Unwanted Zoning Change

In the 2021 draft plan on the city’s website, parcels where liquor distributor Donaghy Sales and Hormel Foods’ Corn Nuts processing facility are located were proposed to be rezoned for office uses. It took action from Fresno city councilmembers to preserve the land for industrial purposes.

The steering committee that helped develop the Central Southeast plan voted to use office zoning as a buffer between industrial and residential areas, according to comments made on the plan by the community group Leadership Counsel for Justice and Accountability, in 2021.

Attorney John Kinsey with Wanger Jones Helsley represents Donaghy Sales.

He said the company’s distribution center had originally been included in the South Central Specific Plan before being moved to the Central Southeast plan. Councilmember Luis Chavez and other council members directed staff to move Donaghy and Hormel back to the South Central plan, with their industrial zoning intact.

Donaghy now wants to be taken out of the South Central plan, which Kinsey says is more controversial.

The longtime Fresno company, which employs several hundred workers at its facility near Jensen and 99, was never notified about the process, according to Kinsey.

“The city is engaging with community processes but they’re not engaging with businesses,” Kinsey said.

Attorney Says Fresno Has a History of Not Notifying Business Owners

Maps of the Central Southeast plan posted on the city of Fresno website show different boundaries, which created confusion.

Business advocacy group Invest Fresno reached out to Donaghy advising that the plan showed their land zoned as office, according to Ethan Smith, the group’s chairman. That notification prompted Kinsey to pen a letter to city staff.

In the letter, Kinsey asked “what measures have been taken to inform property owners whose zoning may be changed of the CSASP process.” He said he received no response.

Central Southeast plan project manager Drew Wilson said the city had sent two mailers to both residents and businesses.

Multiple requests for comment sent to city staff by GV Wire were not returned.

“This appears to be a continuation of City staff’s recent practice of not providing light industrial landowners with notice that their properties would be downzoned, akin to what occurred in connection with the Southwest Specific Plan in 2017,” Kinsey wrote.

None of the public comments posted by city staff come on the Central Southeast plan came from business advocates.

The Southwest Specific Plan rezoned 93 acres of land between Elm Avenue and Highway 41 to mixed use from light industrial zoning.

City councilmembers are still deciding how to deal with business owners operating out of compliance because of the adoption of the Southwest plan.

At the May 11 meeting, councilmembers directed City Attorney Andrew Janz to come back with options, including a zoning overlay or a total rezone, Kinsey said.

In the case of Elm Avenue rezone, it wasn’t until a property owner filed for a permit to expand their business that they found out they were no longer zoned industrial, Smith said.

Consequences for Land Use Decisions Unconstitutional, Attorney Claims

In the letter to the city of Fresno, Kinsey cites the U.S. Constitution’s prohibition on taking private land for public use, saying that rezoning the land has the same effect.

“Government regulation of private property may, in some instances, be so onerous that its effect is tantamount to a direct appropriation or ouster,” Kinsey quoted from the court decision in Lingle v Chevron U.S.A. Inc.

Businesses no longer operating in compliance with designated land use face the potential for massive devaluation of property values, Kinsey said. Businesses can’t increase operations or change uses, for instance from manufacturing to warehousing.

United Security Bank CEO Dennis Woods said in a public comment before the city council October 2022 that business operating out of zoning compliance can’t get conventional financing for capital improvements or for upgrades such as purchasing electric vehicles.

Rezoning Part of Strategy to Clean up Parts of City

Concern about emissions and truck traffic have prompted the authors of specific plans to create mitigating measures against industrial users in south Fresno.

Chavez said environmental justice was a priority of the steering committee.

“That was included by some of the folks that were on the committee. You know, in full transparency, they were the folks that always focus on the environmental justice, you know, agenda,” Chavez said.

In a comment made on the plan by Leadership Council in 2021, the use of office zoning does not go far enough.

“This narrative is harmful as these zoning options bring industrial practices that do not reflect residents’ priorities,” the comment says.

City staff responded by saying parcels zoned for office had been removed and put into the South Central Specific Plan.

Chavez said he worked with planning and development department director Jennifer Clark to remove both Donaghy and Hormel from the plan.

Chavez Says Industrial, Residential Balance Needs to Be Struck

Balancing industrial and residential is a challenge, Chavez said. The focus for these specific plans is on housing and creating clean, safe neighborhoods. But industrial businesses predate the residential areas that have been booming in the area.

People who move into those areas are aware of their proximity to industrial uses.

Resident opposition to industrial uses is not cut and dry, Chavez said. Those annoyed by large trucks coming and going may not be in favor of businesses, but the reaction could be different for those employed by nearby industrial companies.

There are 20 different food processors in Chavez’ district.

“Overwhelmingly for me, I think it’s been more of people that are more concerned with the jobs and the opportunities that they’re providing there for the area,” Chavez said.