2021_South_Beach_Refinement_Plan_Final.pdf

November 2021Newport, OR

SOUTH BEACH / US 101

REFINEMENT PLAN

Acknowledgements

City Staff: Interviewees:

Andrew Grant, Wastewater Treatment Plant Supervisor Laura Anderson, Local Ocean Chris Janigo, Acting City Engineer Ann Armstrong, Yaquina Bay Economic Foundation Sherri Marineau, Executive Assistant Jeff Bertuleit, Bertuleit Donald J Trustee Spencer Nebel, City Manager Charlotte Boxer, Commercial Developer Clare Paul, Assistant City Engineer John Bungay, Bungay Properties, LLC Derrick Tokos, Community Development Director Bob Cowen, Hatfield Marine Science Center Garrett Bush, Airrow Heating Brett Fox, White-Fox LLC Urban Renewal Agency: Peggy Hawker, Public Arts Committee Beatriz Botello Travis Henry, Henry Point Development, LLC Aaron Collett Phillis & Marvin Hoover, Commercial Property Owners Dietmar Goebel Carrie Lewis, Oregon Coast Aquarium CM Hall, Council President Jonathan Ledesma, Project PDX Cynthia Jacobi Lyle Mattson, JC Market Thriftway Ryan Parker Paula Miranda, Port of Newport Dean Sawyer, Mayor Bonnie Serkin, Landwaves, Inc Lance Vanderbeck, Newport Airport Committee Jack Waibel, Rogue Brewery City Committees: Alan Wells, Commercial Real Estate Broker Airport Committee Planning Commission Public Arts Committee

Table of Contents

1. PLAN PURPOSE AND BACKGROUND

2. OPPORTUNITIES AND CONSTRAINTS SUMMARY

3. INVESTMENT FRAMEWORK

4. ACTION PLAN PROJECTS

Exhibit 1. Urban Renewal Investment Areas

Peninsula and

US 101

Investment Area

Airport Investment Area

The South Beach Urban Renewal Area comprises 1,169 acres and features two interconnected but distinct geographies which have different investment needs.

South Beach / US 101 Refinement Plan - Fall 2021 1

1. Plan Purpose and Background

Nestled on the south side of the Yaquina Bay Bridge, Newport’s South Beach provides a mix of regional institutions, recreational facilities, neighborhoods, and retail businesses. The area has changed substantially since 1983, when the City of Newport established an urban renewal district in the area to address the lack of transportation connections, urban infrastructure, and public amenities.

Since then, the Urban Renewal Agency (“the Agency”) has helped to complete the area’s transportation network, fund the creation of a wastewater treatment plant, spur the development of the popular Oregon Coast Aquarium, and as of 2021, is in the process of making improvements to US 101 that will reconfigure key intersections to ease congestion. In addition to the Aquarium, the area features a mix of institutions, including the Hatfield Marine Science Center, OMSI’s Camp Gray, Oregon Coast Community College, Newport Municipal Airport, and the Port of Newport’s South Beach Marina and RV Park.

The South Beach Urban Renewal Plan is nearing its expiration at the end of 2025 and the Agency acknowledges that the area still faces key transportation, redevelopment, and placemaking barriers. This Urban Renewal Refinement Plan is an Action Plan that identifies a set of impactful projects that the Agency could invest in with its remaining $5.15 million to $8.97 million of funding.1 Each of these projects was vetted for public support and ability to achieve the objectives of the Urban Renewal District. The Agency’s goal is to distribute funds to provide the greatest benefit to the tax base including area residents, visitors, and employees while also helping to remove development barriers on the remaining underutilized parcels in the area.

The new intersection of US 101 and SE 35th Street that was installed as part of the 2021 US 101 improvements in South Beach creates an opportunity for redevelopment for adjacent parcels, including the Agency-owned site on the NE corner.

Credit: City of Newport

1 The Agency would have up to $5.15 million for future projects costs if it proceeded with a “pay as you go” scenario acquiring no new debt. The Agency would have up to $8.97 million if it takes out an additional loan in 2025.

South Beach / US 101 Refinement Plan - Fall 2021 2

South Beach Urban Renewal Plan Objectives

Project concepts for the final phase of Urban Renewal investments must be consistent with the following South Beach Urban Renewal Plan (1983) objectives:2

§ Preserve forest, water, wildlife, and other natural resources

§ Identify sites for public use such as the OSU Marine Science Center

§ Complete a Port-facilitated marine recreation area

§ Encourage marine oriented activities on the northern Shorelands

§ Assure the development of complementary uses adjacent to the Airport

§ Plan new sewer, water, and transportation capacity

§ Allocate a major part of South Beach to heavy commercial and light industrial uses

2 The Benkendorf Associates Corp, “Substantial Amendment Five to the South Beach Urban Renewal Plan 5”, City of Newport, Oregon Urban Renewal Agency (September 2008).

South Beach Blighting Conditions (1983)

The South Beach Urban Renewal Plan was created to reduce or eliminate blighted conditions in South Beach, including:

Sub-standard street improvements, rights of way, and traffic signalization and management

Incomplete pedestrian/bicycle circulation systems and Tsunami evacuation routes

Inadequate water storage capacity and distribution lines

Undersized or absent sanitary sewer collection service lines

Incomplete winter storm water management systems

Inadequate neighborhood recreation facilities and open space

Source: South Beach Urban Renewal Plan Amendment 5

South Beach in 2021: While the Agency has made progress in solidifying the area as a functional district within the city, several constraints remain:

§ While US 101 runs through the area as the key transportation spine, South Beach’s most charming attractions are hidden from view.

§ South Beach’s many bike paths provide an alternative to car transport, but the network feels patchy in places.

§ South Beach lacks a strong sense of place and could use landscaping and public art installments more effectively.

§ Invasive species are a problem in South Beach, and current management is insufficient.

§ Residents, visitors, and employees in the area point to a lack of retail services in the area, requiring them to cross the Yaquina Bay Bridge for any goods or services they might need.

§ Traffic congestion remains a concern, especially at 40th Street, which is poised to see growth as the Wilder residential area builds out.

§ At the district’s southern end, lack of sewer infrastructure limits development opportunities on industrial and commercial properties near the Airport.

South Beach / US 101 Refinement Plan - Fall 2021 3

Plan Investment Priorities

Since the urban renewal area has existed for close to 40 years, the refinement plan acknowledges the progress the Urban Renewal Agency has made in achieving its objectives as well as the changed conditions and user base in the area. The Agency has established the following investment priorities for the 2021 refinement plan to create a framework for how the Agency will operate in the remaining life of the urban renewal area. They are based on conversations with stakeholders, the Staff Technical Advisory Committee (composed of key public works, planning, and management staff), and the Agency. They also reflect broader City priorities as part of the Newport Vision 2040.

1. Promote a sense of place for residents and visitors that reflects the South Beach identity.

2. Improve connectivity for bicyclists and pedestrians to South Beach destinations.

3. Attract new development that can meet the service and retail needs of South Beach residents.

4. Invest in overcoming market and development barriers on underutilized or vacant sites.

5. Reduce sewer, water, and transportation infrastructure barriers to enable job creation on industrial lands near the Airport.

6. Invest in improvements that promote long-term community resiliency to address tsunami, flooding, and earthquake hazards.

Aquarium Village offers an eclectic blend of makerspaces and businesses serving visitors, such as gift shops and restaurants. Credit: ECONorthwest

The City and Urban Renewal Agency are interested in helping South Beach to contribute to the overall vision for Newport:

“In 2040, the Greater Newport Area is an enterprising, livable community that feels like home to residents and visitors alike.

We have carefully planned for growth with well-maintained infrastructure, affordable housing for all income levels, robust public transportation, diverse shopping opportunities, and distinct, walkable districts and neighborhoods.”

Source: Newport Vision 2040

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Refinement Plan Process and Public Involvement

The Urban Renewal Refinement Plan (“the Plan”) draws from many sources to identify priorities and projects, including technical analysis of the development and infrastructural needs in the community and significant community and stakeholder outreach. Exhibit 2 shows the key elements of the planning process and overall project timeline.

Exhibit 2. Refinement Plan Timeline and Tasks

Engaged with the community. While COVID-19 restrictions prevented in-person engagement, the planning team, which consisted of four consultants/subconsultants as well as City partners, conducted community outreach throughout the entire planning process with:

§ 18 interviews with individuals and committees completed by the City and the consultant team. Participants included local business and property owners, real estate brokers and developers, committees, community members, and economic development professionals.

§ 4 participants in a Marine Resource focus group conducted over the summer.

§ 23 community members participated in a Community Workshop held online on August 26, 2021. Attendees were encouraged to prioritize project concepts and specific investments.

§ 466 respondents to two surveys that were released in July and September 2021. The first survey was developed to understand key issues and priorities for community members.

The second survey was designed to generate feedback on specific project concepts.

South Beach / US 101 Refinement Plan - Fall 2021 5

Analyzed the Area’s Opportunities and Constraints. The Opportunities and Constraints Report in Appendix A provides background information on key constraints for revitalization, stakeholder priorities, and points to potential opportunities for Agency investment in the area. JET Planning conducted a code audit to further understand potential barriers associated with land use regulation.

Evaluated Project Concepts. The existing conditions research and community outreach informed a list of potential improvements and infrastructure projects for implementation. The team, with Agency support, developed an Investment Framework (Appendix B) for evaluating and prioritizing those projects to ensure that all projects met the goals and priorities of the Urban Renewal Plan.

This Plan proposes to enhance South Beach’s sense of place by investing in landscaping, improving wayfinding, and adding amenities including public art (See Project Sheet F for details). Eighty-five percent of survey respondents indicated that new wayfinding and public art should include water-based themes related to existing uses in the area. Photos compiled by SERA Architects.

How do people perceive South Beach? Survey respondents indicated that South Beach suffers from traffic congestion and lacks a sense of place.

“No identity, just a place from which businesses operate.”

“Traffic nightmare”

However, many respondents also indicated that the area has natural amenities and untapped potential

“Potential to be the fun…district of Newport.”

“Natural beauty”

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2. Opportunities and Constraints Summary

As a foundation for action, this chapter describes the opportunities and constraints present in South Beach that serve as a basis for project needs and prioritization.

South Beach is home to some of Newport's most visited institutional and recreational organizations, many of which have potential to expand in the near future. Residential development is also underway with Wilder planning to add twenty-six houses this year.

Each of these plans for growth provide opportunities for South Beach, but also raise concerns about current capacity.

Opportunities exist throughout the study area but especially on the Peninsula and along US 101 to improve a sense of place and visitor experience in South Beach. Stakeholders identified opportunities to improve South Beach through an overhaul of the area’s visual identity, signage consolidation, and other wayfinding and placemaking improvements.

The City could improve the visibility of destinations from US 101 by consolidating wayfinding signage, catalyzing redevelopment of City-owned parcels, and/or the utilizing the US 101 Ferry Slip Road closure to create a southern gateway. Buying out billboards could also help to remove visual clutter.

Lack of infrastructure, developer uncertainty, and negative public perception is limiting development of Airport industrial sites. Lack of sewer facilities, low water flows, and limited road access limit the type of industries that can function on the Airport sites. Additionally, developers are uncertain about the City’s plans for the site and whether they will be able to build what they want if they do invest in the property. Investing in infrastructure and clarifying the City’s intentions would go a long way in promoting development.

Funding projects that enable new development and job creation at the Airport was not a priority for survey respondents.

Only 7% identified it as very important while 40% indicated it was not important at all.

The Oregon Coast Community College serves around 2,000 students and employs 45 faculty. Credit: ECONorthwest

The right-of-way closure at the US 101 and Ferry Slip Rd.

provides a location for a southern gateway to Newport.

Credit: ECONorthwest

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Limited and disconnected multimodal infrastructure and traffic congestion remain key challenges in South Beach. While there are many multimodal pathways, sidewalks, and bike lanes in the area, South Beach lacks a cohesive, signed, multimodal network. Additionally, traffic congestion, especially during peak periods, make it difficult to cross the Yaquina Bay Bridge and access key points along the Peninsula. Recent improvements, including the relocation of the traffic signal to US 101 and 35th Street, provide a strong start to addressing these issues.

This Plan proposes a new traffic signal at the intersection of US 101 and 40th St. to improve safety and ease of access to the Wilder Development, Oregon Coast Community College, and the planned OSU student housing development (see Project Sheet H). Credit: ECONorthwest

Planning and development efforts in South Beach should consider the natural and geologic hazards for which the area is at risk. Various systems (electric, sanitary sewer, etc.) may be impacted by a tsunami or other seismic events. Upgrades to these systems or new projects should take resiliency into consideration.

The Yaquina Bay Bridge is of particular concern – in the event of bridge damage due to a natural disaster, the residents of South Beach would be cut off from all the essential services and resources north of the bridge. Development of essential services (access to food, fuel, and/or healthcare) in South Beach would provide some fundamental resiliency to the area if the bridge were impassible.

While there were other challenges and opportunities identified in South Beach, this plan focuses on those most relevant for urban renewal investment

The full Opportunities and Constraints Report is in Appendix A and includes opportunities and constraints maps with corresponding tables.

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Land Use Policies, Zoning and Regulations Audit

Land use policies and regulations impact development possibilities in South Beach. The land use code audit determined how existing land use plans, maps, and regulations impact development in South Beach. It also identified potential revisions that could be enacted to better align with area goals and investments. The detailed audit can be found in Appendix E. Exhibit 3 summarizes key findings and recommendations.

Exhibit 3. Land Use Audit Findings and Recommendations

Key Findings Recommendations Mapping - The mix of commercial and light industrial zones along US 101 generally aligns with Urban Renewal District goals.

There is potential for select re-designation from industrial to commercial for key areas.

§ Expand commercial district along US 101 to encompass the SE 35th St gateway site and surrounding properties.

§ Rezone the NE corner of SE 40th St and US 101 for commercial taking advantage of potential new signal.

§ Rezone parcel on south side of SE 40th St from heavy industrial to light industrial to reduce potential use conflicts. Identify sites for heavy industrial farther south.

Annexation - Nearly 25% of the district is outside of the City limits and cannot yet be developed to urban levels of intensity or served by urban infrastructure. More than half of these areas are designated for industrial uses.

§ Actively pursue annexation of industrial properties using island annexation provisions coupled with financial incentives to offset infrastructure costs, engaging with individual property owners to understand priorities and needs.

§ Engage with Lincoln County to complete the Urban Growth Management Agreement to ensure an orderly transition from County to City zoning and infrastructure.

Zoning - The City’s Zoning Code clearly delineates zones with use standards and site development standards. The prevalent Light industrial zone benefits from allowing a flexible mix for industrial and commercial uses however this can result in uncertainty about the compatibility of future development.

§ Limit uses inconsistent with district development goals by prohibiting uses associated with low employment for all or highway-abutting light industrial sites.

§ Introduce a 15-foot setback with required landscaping for both industrial and commercial properties along US 101.

§ Develop landscape screening, buffering and/or fencing standards to improve compatibility of light industrial uses.

§ Maintain existing land use and building permit procedures, which minimize discretionary reviews.

Other Considerations - The City should continue to monitor issues such as parking demand and trip allocation within South Beach and adjust as appropriate.

§ Review the employment and tax generation potential of uses permitted within the district to determine if future modification of permitted uses is justified within the light industrial zone

§ Consider using development agreements for greater certainty on proposed development for select sites

§ Monitor parking demand and implication of current parking ratios for site development feasibility. Explore options for shared parking on individual sites and district-wide parking reductions.

§ Review the impact of commercial rezoning on the SBTOZ trip budgets and reallocate trips within the district as necessary.

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South Beach Opportunity Sites

South Beach has several potential opportunity sites for new development. There is a cluster of vacant/underutilized sites on US 101 near the Agency-owned site at 35th St. Two sites near the NOAA facility that currently house dredge spoils or vacant warehouses could be redeveloped for complementary uses. There are also limited industrial development opportunities on vacant sites near the Airport.

All the sites in the tsunami evacuation zone could be developed with commercial uses, while sites in the upland areas out of the evacuation zone (including near Wilder) could be developed with housing.

Future demand drivers for the area include an increase in student housing, expansion plans for the Wilder residential area, and other sites that might draw new employers near the Airport. These new residents and employees are going to drive a changing retail demand landscape.

This Plan proposes to promote development of the Agency-owned 35th Street site with uses that meet community needs.

The Barley Pod in Portland is an example of a food cart pod anchored by a brewing company, a concept that could work well on the site. Credit: ECONorthwest

Community engagement and market analysis revealed key service gaps in South Beach including:

Grocery stores

Gas stations

General retail

Casual restaurants

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Agency-Owned 35th Street Site

The US 101 and 35th Street Agency site offers an opportunity for the Agency to help promote a development concept that meets community goals. Coupling these improvements with gateways and public art would help to transform the southern entrance to Newport making this site a “go-to” South Beach destination.

Exhibit 4. Opportunities and Challenges for the Agency-Owned 35th Street Site Opportunities Challenges

• Highly visible with lots of through traffic on a corner intersection

• Close to key destinations

• Can be a part of the South Beach brand

• Can be a key node for multimodal path

• Far from Downtown and other commercial activity

• Context is arterial/commercial

• No existing building as centerpiece for adaptive reuse

Determining potential uses and vetting potential concepts was a key part of refining this project. Four uses rose to the top as desirable and feasible for this site3:

§ General Merchandiser

§ Specialty Grocery

§ Microrestaurants/foodcarts

§ Retail

Taking these four uses, the planning team compiled three potential concepts for development on the site detailed below. Ultimately the City will use these concepts in a Request for Qualifications (RFQ) to be released in Spring 2022.

3 While a gas station was identified as a need both during community engagement and technical analysis, it was determined that it would not contribute to the “gateway” envisioned on this site. A gas station may be better situated near 40th St.

Project Sheet A includes additional details that will inform the 2022 RFQ including:

Development objectives for the site

Public private partnership potential

Zoning considerations

Community preferences on development concepts.

Community Preferences

Which uses were most popular for the 35th Street site? Survey respondents who were South Beach residents and employees favored a small or specialty grocer whereas those who lived in Newport or elsewhere identified food carts or microrestaurants as their top choice.

Which concept was most popular for the 35th Street site? Survey respondents indicated that they would like the site to become a “Food Destination” with specialty grocery and microrestaurants

“The realignment of the traffic signals [at US 101 and 35th] and the location just south of the bridge is an opportunity to give South Beach a ‘go-to’ destination for a new type of shopping experience” - South Beach Stakeholder

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Illustrative Site Plans

Alternative 1: “Go Big” Large Anchor and Retail. The 2.3-acre Agency-owned site north of 35th Street will host a major tenant like a Bi-Mart style general retailer/grocery on roughly 75% of site. The rest of the site will fill out with detached additional retail and/or open space with trail amenities.

The southern parcels, which currently contain Airrow Heating, Columbia Distributing, and Hoover’s Pub and Grill, will contain a small retail cluster and single large stand-alone restaurant (new or refresh). The southern parcels are privately owned, and concepts will be influenced by ongoing conversations with the current business and property owners. The site should leverage adjacency to the Ferry Slip gateway site.

Economic Considerations: Recruiting a large grocer may prove challenging on the site if the potential market is considered insufficient to sustain operations. Additionally, receiving supplies on the Coast could be costly for potential tenants especially if they do not have other stores nearby. However, a large anchor can draw other retail tenants to the area and the Agency may want to consider partnership opportunities on this site to make it feasible long term.

Exhibit 5. Alternative 1: “Go Big” Large Anchor and Retail

Credit: SERA Architects

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Alternative 2: “Food Destination” Specialty Grocery Plus Microrestaurants. The Agency-owned site will host a small/medium grocery with prepared food, a deli, and perhaps small counter-service dining.

Adjacent to the grocery will be a cluster of food carts with possible structured shelter and partial indoor space, and a microrestaurant pod with an indoor/outdoor blend.

Economic Considerations: The market area would likely be sufficient to sustain a small grocery although the tenant will need to be familiar with the challenges of delivering to the coast. This site could provide an ideal opportunity for a local grocer to expand.

Exhibit 6. Alternative 2: “Food Destination” Specialty Grocery Plus Microrestaurants

Food cart pod / microrestaurant considerations

Tenanting/rightsizing will be important with 8-10 unique concepts being the ideal. More would be too difficult to manage and less would not provide enough choices.

The City should gauge interest among local entrepreneurs or existing restaurants for satellite locations.

The City should consider recruiting a master lessee to operate/manage subleases and establish ground rules.

South Beach / US 101 Refinement Plan - Fall 2021 13

Alternative 3: Mixed Retail. The Agency-owned site will host a cluster of smaller retail/service/office uses, such as food carts, offices, coffee shop, retail, small medical (i.e., Zoom+Care), and other uses popular in the community survey. This site should aim to add urban appeal by concealing parking behind, providing access from Ferry Slip (which currently has just one curb cut on US 101), and including open space or park use, assuming the small commercial does not consume the entire 2.3 acres.

Economic Considerations: Without an anchor, some retailers may be hesitant to locate to this site. Retailers that do locate here should be local-serving and fill gaps in the South Beach market.

Exhibit 7. Alternative 3: Mixed Retail

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3. Investment Framework

The opportunities and constraints identified in Chapter 2 make it clear that South Beach is well-positioned for growth but needs targeted investment to reach its potential. This chapter establishes an evaluation framework to help frame the Agency’s decisions about which projects to evaluate further, and ultimately advance for urban renewal funding. It also provides a structure for implementation.

Who: The Agency and Partners

For all the projects evaluated, the Agency assumes it will be leading investment or providing matching investment, given the limited time remaining in the life of the district. Bringing new private investment into the community is a key goal of this Action Plan, provided such efforts can be coordinated before the plan closes to new projects. Successful implementation will require time and energy from many partners within the City.

Where: Two Investment Areas

Agency investments will span two investment areas within the Urban Renewal Area: The Peninsula/US 101 Investment Area and the Airport Investment Area

§ The Peninsula/US 101 Investment Area is home to the area’s major institutions, attracts visitors from around the United States and beyond, and is home to the area’s retail establishments and hotels. The projects focused on this area include Projects A, B, E, F, G, and H.

§ The Airport Investment area includes the Municipal Airport and publicly and privately owned land that is zoned for industrial development. The projects focused in this area include Projects C and D.

When: End of 2025

If the Agency is to execute on its priority investments by 2025, it will need to be strategic about the choices it makes and poised to act quickly. All projects must be awarded by December 31, 2025.

Established in 1983, the South Beach Urban Renewal Plan has an original maximum indebtedness of $38,750,000. Key recent milestones include:

2009: The URA was extended at a reduced size for the purpose of upgrading the infrastructure and acquiring land to support economic development. With public input, a new project list was developed with the 2009 extension, to be funded with revenue bonds over three six-year phases.

2018: The URA completed a substantial amendment of this plan to move the deadline for awarding projects from December 31, 2020, to December 31, 2025. This amendment extends the date after which no bonded indebtedness can be issued with respect to the Plan.

South Beach / US 101 Refinement Plan - Fall 2021 15

How Much: Up to $9 million

As a part of the planning process, the Agency weighed the priority of each project against its potential cost and discussed the merits of the different funding scenarios. The Agency ultimately decided that all the projects are important and is willing to take out an additional loan in 2025 in order to accomplish all projects. The Agency should aim to leverage funding from regional, state, and federal partners as grant dollars might be available which will impact how much funding is needed.

Why/How: Investment Criteria

Evaluation criteria included:

1. Can the Agency award the project by 2025?

2. Will the project necessitate a substantial amendment?

3. Does the project align with the objectives from the 1983

South Beach Urban Renewal Plan?

4. Does the project advance the 2021 investment priorities for the urban renewal area?

5. How much community support did the project receive?

Each project was evaluated against the first three specific criteria to ensure it met threshold requirements. Projects that did not meet these requirements were excluded from further consideration. Projects were further prioritized by their alignment with 2021 priorities, community feedback and cost to determine the importance of the different projects.

Investment opportunity: Left - Existing multi-use path along Ferry Slip Rd.

Right – Example of trail improvements: Indianapolis Cultural Trail is a 3-mile trail connecting Downtown Indianapolis with integrated art and landscaping. Photos compiled by SERA Architects.

Funding Scenarios

Pay as you go - $5.15 million The Agency collects TIF dollars through FYE 2025 and pays directly for projects without acquiring new debt. This scenario could complete most projects with limited incentives. Tax increment would return to the districts in FYE 2026.

Additional Loan - $8.97 million The Agency collects TIF through FYE 2027 by taking out a loan prior to 2025 to leverage last two years of TIF. This scenario could fully fund all projects. Tax increment would return to the districts in FYE 2028.

2021 Forecasts by Tiberius Solutions

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4. Action Plan Projects

Attracting new development to South Beach will take a coordinated effort by the City, businesses, and private investors. Because limited public funds are available for capital projects and programs, it is necessary to prioritize these investments. With targeted investments and partnerships, South Beach could achieve its vision for a more active commercial corridor and increased opportunities for jobs. The strategic use of urban renewal funds can help to improve visitor experience and increase private sector confidence in investing in the District. It will also provide a bridge for pioneering development projects to overcome the significant financial gap for new development in South Beach.

This chapter outlines eight projects that can help South Beach achieve this vision. Some projects benefit the tax base directly by removing market or infrastructural barriers for businesses, while others focus on investments to placemaking, public art, landscaping and other visualization improvements that help establish a sense of place. These projects also benefit the economy by promoting tourism and local spending. Likewise, multimodal improvements that cater to pedestrians and cyclists enhance the sense of place and encourage people to spend time and money in the local community.

Final Project Selection

All projects included in this plan met the threshold evaluation criteria. The following table shows:

§ Community support: These scores are based on how the projects ranked in the community surveys and other engagement.

§ Strength of alignment with priorities: Projects that clearly advanced one or more priorities were moved forward.

§ Cost: Projects were considered high cost if they were $1M+, medium cost if they were between $500K and $1M, and low cost if less than $500K.

Additional details on project evaluation can be found in Appendix B.

What’s included in the project sheets?

A description of the project

Rationale for including the project on the list

Alignment with South Beach’s 2040 vision

Implementation Steps

Outreach considerations

Potential partners for the City to engage on the project

Planning cost estimates and

Additional funding considerations

Two projects were removed from the list during prioritization and do not have project sheets.

Provide transportation access to east Airport properties – these properties are unlikely to develop soon and therefore do not have a pressing need for transportation access

Install a traffic signal at SE 50th and US 101 – demand for this signal is very low at this time

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Exhibit 8. Refinement Plan Projects to be Funded with Remaining Tax Increment

Key Project Rationale Meets Priorities

Public Support Estimated Cost

A Redevelop 35th Street site to meet community needs providing strategic investments in neighboring properties to promote redevelopment concepts

Promote development that meets public goals combined with a gateway that improves the arrival experience and business / destinations visibility. Potential for strategic investments in part

Yes High

$1.3 million ($300K for public restroom and path user amenities $1 million for investments in neighboring properties; land write down of up to $1.5 million not included; would be variable depending on the dev’t concept)

B Incentivize annexation of unincorporated properties with a focus on US 101 industrial sites, and target predevelopment assistance to vacant or underutilized sites

Assist in annexing unincorporated properties within the plan boundaries and condition issues with vacant or underutilized sites to help meet community needs and improve the area’s vibrancy.

Yes Medium

Up to $500,000 (assumes all eligible properties are annexed at the same time)

C Provide sewer infrastructure to industrial sites near Newport Municipal Airport

Expand the types of development possible and reduce developer uncertainty. Yes Low

$600,000 - $2 million

(depending on technology used)

D Improve fire suppression capability at Airport industrial sites

Expand the types of development that would be able to locate at the Airport

Yes Low $150,000 - $500,000

(preliminary estimate)

E Install redundant Yaquina Bay water pipeline

Improve South Beach’s resiliency to water line failure

Yes Medium

$750,000 (if grant unsuccessful, Agency could pay closer to $3 million; surplus from other projects could be directed here to fully fund)

F Enhance South Beach placemaking through improvements to landscaping, public art, and gateways

Bolster the area’s sense of identity through targeted improvements. Yes Medium

$1 million ($150-250K in consulting fees, up to $850,000 in improvements)

G Enhance mobility for cyclists and pedestrians through South Beach Loop path improvements

Improve mobility for cyclists and pedestrians while enhancing sense of place and navigability. It would also improve disaster preparedness

Yes High

$1.3 – 1.45 million (high priority projects only, excluding ROW acquisition)

H Install a traffic signal and enhanced pedestrian facilities at SE 40th Avenue and U.S.

Open the door for planned development and ease congestion Yes High

$1.5 million (not including bike/ped improvements, which are included in Project G)

Total Project Costs Up to $9 million

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Detailed Project Sheets

The following sheets provide details for each of the proposed projects.

A

Redevelop SE 35th Street site to meet community needs providing strategic investments in neighboring properties to promote redevelopment concepts.

Project Description Lead

The Agency-owned site at 35th Street could be South Beach’s neighborhood hub and the gateway to South Beach, given that the site sits at the District’s entrance to the key destinations of the Newport Aquarium, Hatfield Center, South Beach State Park, Rogue’s pubs, OMSI’s Camp Gray, and Aquarium Village. Community members have expressed a desire to see this area transformed to better reflect the many attractions and natural beauty of South Beach.

Development objectives:

§ Serve as a neighborhood hub and gateway to South Beach.

§ Provide stopping point for users of South Beach Loop path. The site will also serve as a key node along South Beach’s iconic bicycle and pedestrian loop, which connects all of the key destinations.

§ Provide gathering spaces for residents and visitors, with lots of retail and restaurant choices.

§ Support food entrepreneurs and surrounding businesses.

§ Build upon the gateway opportunity at the closed ROW at the former entrance to Ferry Slip.

Potential uses: The highly visible and central location could attract investments in buildings that house services or retail (e.g., specialty grocery, restaurants, shops) and offer a central gathering space for eating and convening groups to serve South Beach area residents and employees.

Partnership with adjacent property owners:

§ Expanded development concept: On the southern parcels, which currently contain Airrow

Heating, Columbia Distributing, and Hoover’s Pub and Grill, Alternative A shows a small retail cluster and single large stand-alone restaurant (new or refreshed Hoover’s). The southern parcels are privately-owned, and concepts will be influenced by ongoing conversations with the current business and property owners.

§ Partnership with adjacent businesses: Prior to RFQ release, the City should reach out to South Beach Market, Barrelhead, Columbia Distributing, Airrow Heating, and other restaurants to get feedback on the concepts, answer questions, discuss compatibility with potential commercial concepts, and gauge interest in partnerships.

§ Billboard removal: Two legacy billboards on the Hoover’s site constrain redevelopment opportunities on this site and detract from the desired village feel of the 35th Street site. The Agency will consider paying out the remaining contract that Hoover’s has with the billboard company to remove the billboards and allow for more flexible reuse of the site.

Urban Renewal Agency / Community Development / City Manager’s Office

South Beach / US 101 Refinement Plan - Fall 2021 19

Rationale

Because the Agency controls the 35th Street site, it can help promote a development concept that meets public goals. Coupling these improvements with gateways and public art would help transform the southern entrance to Newport. Currently there is no clear indication that a visitor has arrived in the community when driving north on Hwy 101 into South Beach.

Alignment with Vision 2040

A3. Transportation Corridors [Partner] A13. Strategic Investments and Partnerships [Lead] A14. Developable Land [Partner] Depending on businesses recruited:

E2. Medical Professionals and Specialists [Support] E12. Access to Health Food [Support]

Implementation Steps

§ Consider adjusting zoning to accommodate desired development type (from industrial [I-1] to commercial [C-1]). The commercial/retail uses proposed here are all permitted outright in the I-1 district. There is concern, however, that surrounding I-1 sites could be developed with actual light industrial uses, including things like vehicle repair or storage, self-storage, warehousing, and distribution, that could be incompatible with the atmosphere desired for this site. The I-1 zone also requires a 50-foot setback from Hwy 101 that would limit the development area on this site. This could be addressed through rezoning to commercial (C-1) that has no front setback requirement or revising the setback for the I-1 district as recommended in the code audit.

§ Continue to discuss potential partnership with property owners of Hoover’s and Airrow Heating sites, which could provide a cohesive gateway to South Beach. Acquire additional properties, if feasible, to develop the desired program.

§ Release RFQ to attract a developer in Spring 2022, using development objectives developed through the refinement plan process.

§ Analyze cost implications for the city of ongoing maintenance for the gateway.

Public or stakeholder outreach needed

The City conducted outreach with developers, existing restauranteurs, potential tenants, key stakeholders, and the public as part of the refinement plan to develop objectives and vet concepts. The City will reach out to property owners of parcels that may need to be acquired.

The City may also coordinate with the Urban Renewal Agency to seek their input on site programming goals.

Partners Potential developers, South Beach businesses, and organizations

Estimated Cost Funding Considerations

Up to $1.3 million

($300K for public restroom and path user amenities and $1 million for investments in neighboring properties)

(land write down of up to $1.5 million not included; would be variable depending on the dev’t concept)

Funding for public-private partnerships on the site will come from urban renewal funds, with technical assistance from the City.

§ Land write down: Depending on the value proposition offered by the selected development team, the Agency could offer up to the full value of the land cost as a write down. The city prefers the potential land write down not exceed $750,000 but the decision would be subject to the development proposals solicited as a part of the RFQ process. The Agency would need to evaluate the cost of public amenities and be receptive to developer feedback about the cost and time required to develop commercial buildings on the coast.

§ Direct subsidy: The Agency may consider providing direct support to help pay for public amenities like a public restroom and Loop path user amenities.

South Beach / US 101 Refinement Plan - Fall 2021 20

ILLUSTRATIVE SITE PLANS

Exhibit 9. Alternative 1: “Go Big” Large Anchor and Retail

Exhibit 10. Alternative 2: “Food Destination” Specialty Grocery Plus Microrestaurants

Exhibit 11. Alternative 3: Mixed Retail

South Beach / US 101 Refinement Plan - Fall 2021 21

Community Feedback

The community provided feedback on the types of uses they would most like to see at the 35th Street site in a survey that was distributed from September 20th to October 17th, 2021. The survey, which received 154 responses, indicated that the most popular uses for the site were:

1. A small or specialty grocery

2. Food carts or microrestaurants

3. An array of neighborhood serving retail services.

The survey also asked respondents to rank three concepts (see Illustrative Site Plans) that incorporated these uses in varying ways. Alternative 2: “Food Destination” was the most popular choice followed by Alternative 3: Mixed Retail.

ZONING CONSIDERATIONS

As a part of the Refinement Plan process JET Planning conducted a code audit to further understand potential barriers associated with land use regulation. Findings relevant to the 35th Street site are detailed below (see Appendix E for more details).

§ Recently updated provisions allow food carts individually and in pods of four or more throughout the South Beach area. (NMC 14.09, updated September 2021.) Food cart pods on private property are required to provide permanent utility connections and pay system development charges (SDCs), provide covered seating and trash receptacles, and provide access to a restroom.

§ The potential development scenarios will require between 87-114 parking spaces on the

South Beach will be primarily served by auto access so parking availability will be important.

§ Current zoning of Light Industrial permits retail and restaurant uses; however, the site is surrounded by properties that are zoned Light Industrial that the Agency does not control. This could detract from the site’s appeal if developed with incompatible uses.

§ Potential development can likely meet the landscaping requirements. The landscaping requirement is 10% of the overall site, concentrated along the frontages, similar to the proposed sketches.

§ There are no requirements for screening or buffering between uses on the site (NMC 14.18.) There are no limitations on outdoor storage or location of parking or loading areas, nor specific screening and buffering that would apply beyond a requirement for 5% of the parking area to be landscaped (NMC 14.19.050(D)(1)).

§ No other architectural or site design standards apply to commercial and industrial properties within South Beach (NMC 14.30.010).

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USE EVALUATION

Exhibit 12 provides an evaluation of the different uses that could take place on the site. The criteria are intended to provide the Agency with a better understanding of the support different uses might need as well as the benefits they can provide the community.

We considered each use according to:

§ Its level of community support as determined through stakeholder interviews, focus groups, and two surveys § Whether it would require local partners for development and/or financing § How much financial support would be needed from the Agency to make it feasible § The level of tenant management required § Its ability to foster entrepreneurship on the site

Exhibit 12. 35th Street Site Use Evaluation Matrix

General Merchandiser

Specialty Grocery Microrestaurants / Foodcarts

Retail

Community Support Medium High High Medium

Local Partner(s) Required for Dev’t/Financing

No No Yes Maybe

Potential Agency Contribution Likely High Likely High Medium Low

Tenant Management Required

Low Low High Medium

Entrepreneurship Potential Low Low High Medium

PRECEDENT IMAGERY

The images below illustrate the types of developments that could occur on the US 101/35th Street opportunity site.4

4 Photos compiled by SERA Architects

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RESTAURANTS, FOOD CARTS, GROCERY, RETAIL, COMMUNITY SPACE

Restaurant with outdoor plaza (Wilsonville, OR)

New/Renovated Commercial Strip (Portland, OR)

Latino Food Hall in renovated building (Portland, OR)

Pop-up event space and food cart pod (Oakland, CA)

Restaurant/Brewery Manufacturing and dining (Bend, OR)

Brewpub with outdoor dining on busy commercial street (Bozeman, MT)

South Beach / US 101 Refinement Plan - Fall 2021 24

The Ocean food hall (Portland, OR) Small restaurant conversion (Portland, OR)

Restaurant with outdoor seating on sharp angle corner site (Portland, OR)

Container pod restaurants and shops (Albuquerque, NM)

Food Cart Pod (both mobile and permanent-installed dining shed with bar and firepits) (Bend, OR)

Food cart pod (St. Johns, Portland, OR)

South Beach / US 101 Refinement Plan - Fall 2021 25

New-construction corner businesses: stores and offices above

Retail strip (St. Johns, Portland, OR)

Indoor/outdoor farmers market Electric Island charging hub (Swan Island, Portland, OR)

Full-service grocery (Portland, OR) Micro-grocery (Portland, OR)

South Beach / US 101 Refinement Plan - Fall 2021 26

B Incentivize annexation of unincorporated properties with a focus on US 101 industrial sites, and target predevelopment assistance to vacant or underutilized sites

Project Description Lead

Approximately 25% of land within the South Beach URA is outside of City of Newport limits, which makes it difficult for the City to provide key services to large parts of South Beach. Through a predevelopment fund, the City would provide an incentive to annex into the city for US 101 property owners that are outside of city limits but inside of the URA boundary. The City would prefer to discuss annexation potential with property owners to ensure it meets their goals.

However, properties that are surrounded by the city can be annexed without consent using the island annexation provisions under ORS 222.750 and would be best served by annexation assistance (see Exhibit 13 for unincorporated properties).

Key to this strategy would be working with those property owners to annex the unincorporated properties into the City all at once, which would reduce overall costs. The City could cover the annexation expenses, which includes survey costs and old bond debt that the Seal Rock Water District accrued when it provided service to these properties (the properties now receive City water service). The City could also provide incentives for these properties to connect to City sewer service by agreeing to (a) pay wastewater SDCs for existing uses that would otherwise be payable upon connection and (b) provide a rebate of up to $10,000 to reimburse owners for the construction of new residential service laterals and $15,000 for commercial/industrial service laterals.

Beyond the annexation and SDC costs, the Agency could offer additional assistance to help those property owners overcome market or infrastructure development barriers related to site preparation/grading, removal of invasive species (Scotch Broom), and adding or improving utility and transportation infrastructure.

Community Development, Planning Commission

Rationale

Annexing properties outside of city boundaries would:

§ Make it easier for the City to provide infrastructure and services to those properties.

§ Help to increase the desirability of those properties for industrial development.

§ Help the City to achieve its economic development goals by enabling development at urban intensities and limiting development under…