CARAVALHO URGES COUNTY TO TIGHTEN DEVELOPMENT RULES : STUDY: SPRAWL DRAINS CITY FINANCES.

Byline: Sherry Joe Crosby Daily News Staff Writer

Pointing to a study of California counties that shows ``sprawl development'' financially drains cities, City Manager George Caravalho urged Los Angeles County planning officials to adopt stricter development policies.

The study by consultants Crawford Multari & Starr shows that developments built in urban areas bring tax revenues to counties while those outside cities tend to overburden urban streets and public services with new residents.

``The study indicates that these developments really are a negative drain and that really calls for joint planning between agencies to look at the cost of providing services,'' Caravalho said.

Presented at the October meeting of the League of California Cities, the study focused on the city of Redding and the counties of Shasta, San Luis Obispo and Stanislaus.

The report found that cities can reverse the negative impact of suburban communities by luring new residents to urban shopping centers.

``We found that residential development around city edges in unincorporated territory may be fiscal drains on the cities in some cases - it depends in large measure if the new residents in the county will do their shopping in city stores,'' the study said.

The report recommends a balanced approach, building residential and commercial projects in developed areas where both cities and counties can benefit from sales and property tax revenues.

``New development should be focused in urban areas rather than sprawling into unincorporated hinterland,'' the study said.

Los Angeles County planners said they have tried to limit such sprawling developments by offering incentives to developers to build in urban areas and requiring them to pay for extension of city services to their projects.

``With the cost of infrastructure going up, certainly it's important to be located near infrastructure of all types, including freeway access and access to your electrical and gas mains,'' said county planner Lee Stark, who is overseeing the 25,000-home Newhall Ranch project planned for 12,000 acres in county territory outside Santa Clarita.

City officials said the proposed project, which needs approval by the county Board of Supervisors, would snarl traffic on local streets and increase demands on public transportation.

``We provide services, someone has to pay for it,'' said Caravalho, who added it would cost millions of dollars to widen city streets and improve public services to meet the extra demand.

Developer Newhall Land and Farming Co. said its project, which features a mix of houses, retail and commercial enterprises, would financially benefit the county and city.

In a financial impact study, the Valencia developer said the project would provide $301 million in surplus tax revenues to the county and $27.9 million to the city during the project's 30-year construction period.

While praising Newhall Land Co.'s past developments, city officials said they want work with the developer from the start of the project to ensure the new residents' needs are met.

``The bottom line is, we prefer to work with the developer and county so we have adequate infrastructure up front,'' city spokeswoman Gail Ortiz said. ``Folks are going to be using roads, parks and other city services before we get any money at all.''

City officials also worry about Tesoro del Valle, a 2,500-home development planned for 1,800 acres in San Francisquito Canyon about a half-mile south of the Angeles National Forest.

``We're very concerned that (residents of the development) will come down to the (Valencia Town Center) mall, to the industrial area that's already congested,'' Caravalho said.

The city manager called for common development standards between the city and county that would make it easier for the city to annex neighborhoods on its border. In past annexations, the city has had to spend millions of dollars to widen roads, build parks and improve other public services for its new residents.

``We spent $5 million to widen a road that should have been widened while development was occurring,'' Caravalho said of the city's annexation of the Pinetree community several years ago. ``Immediately upon annexation, we spent a lot of money. The city is not capable of doing that upon every annexation.''

Stark said that while the county and its cities have made significant progress in coordinating plans on highways and other infrastructure projects, more planning is needed on roads.

``Circulation is the major coordinating issue,'' Stark said. ``It continues to be the major issue, because it's probably the most expensive public infrastructure and the factor that most affects people.''