1 MINUTES
CITY COUNCIL – SPECIAL MEETING
CITY OF BANNING, CALIFORNIA
January 28, 2026 Council Chambers
5:00 p.m. 99 E. Ramsey Street
In Chambers Banning, CA 92220
The following information comprises the agenda for the special meeting of the Banning City Council, a joint meeting of the City Council and Banning Utility Authority, and the Banning City Council sitting in its capacity as the Banning Successor Agency Board.
1. CALL TO ORDER – 5:04 p.m.
1.1 PLEADGE OF ALLEGIANCE
1.2 ROLL CALL
COUNCIL MEMBERS PRESENT: Mayor Pro Tem Cynthia Barrington Council Member Sheri Flynn
Council Member Leroy Miller
Mayor Richard Royce
Council Member Colleen Wallace
COUNCIL MEMBERS ABSENT: None
OTHERS PRESENT: John O. Pinkney, City Attorney
Art Vela, Interim City Manager
Mark Staples, Planning Manager
Nate Smith, Deputy Director of Public Works/City Engineer Todd Hopkins, Assistant Chief – Riverside Unit
Vickie Sellers, City Clerk
Sandra Calderon, Deputy City Clerk
2. PUBLIC COMMENTS - Closed Session Items Only
None
3. CLOSED SESSION
2.1 CONFERENCE WITH REAL PROPERTY NEGOTIATORS
Pursuant to Government Code Section 54956.8. Property: Banning Municipal Airport consisting of approximately 232.41 acres comprised of APNs 541-240-009; 541-250-009; 541-140-003; 532-150- 002; 532-150-003; 532-150- 004; 532-130-012; 532-130-018; 532-130-011; 532-180-034. Agency Negotiator: Interim City Manager Art Vela or his designee. Negotiating Parties: City of Banning and Industrial Enterprises, LLC. Under Negotiations: Price and Terms of payment. 2 City Attorney John Pinkney said Council did not meet on Closed Session
4. PUBLIC COMMENTS
Public comments on items not on the agenda were not taken due to the Special Meeting.
5. CITY ATTORNEY'S REPORT
City Attorney John Pinkney reviewed procedural guidelines from the manual, emphasizing courtesy, respect, and order during the meeting.
Mayor Royce announced the public hearing for items 6.1 and 6.2, the proposed Sunset Crossroads Specific Plan project, reminding the public of the previously stated guidelines. The process would involve a staff presentation, council questions, and then public testimony limited to two minutes per person, with a suggestion for groups to appoint a spokesperson. Mr. Staples, Planning Manager was then introduced to present the staff report.
6. PUBLIC HEARINGS
6.1 Consideration of Applications By NP Banning Industrial, LLC for the Sunset Crossroads Project, including (1) a Specific Plan (Case No. SP 20-2002) to Allow for the Development of Industrial and Commercial Uses on 533.8-acres of Land Located South of I-10 and the Union Pacific Railroad, and West of Sunset Avenue (Specific Plan Area); (2) a General Plan Amendment (Case No. GPA 20-2501) and Zone Change (Case No. ZC 20-3502) to Amend the General Plan Land Use and Zoning of the Specific Plan Area to General Commercial (GC), Industrial (I), Opens Space-Parks (OS-P), and Open Space-Resources (OS-R), including Pre-zoning for Annexation of Portions of the Specific Plan Area into the City of Banning’s Jurisdictional Boundary; (3) a Development Agreement to Establish Vested Development Rights in Exchange for Public Benefits as Specified in the Agreement; (4) a Tentative Parcel Map (Case No. TPM 38118) for a Subdivision of the Specific Plan Area into Thirty-four Parcels and Five Lettered Lots Ranging in Size from One Acre to Seventy-eight Acres Consistent with the Nineteen Planning Areas in the Specific Plan; and (5) a Final Environmental Impact Report (Sch No. 2021020011) Including Findings of Fact, a Statement of Overriding Considerations, and a Mitigation Monitoring and Reporting Program.
Recommendation: Deny the Project Applications as Recommended by the Planning Commission by Adopting:
(1) Resolution 2026-26 Rejecting the Certification of an Environmental Impact Report (EIR), SCH No. 2021020011, Including Related Findings, Statement of Overriding Considerations, and Mitigation Monitoring and Reporting Program; and
(2) Resolution 2026-27 Denying Applications by NP Banning Industrial LLC for the Sunset Crossroads Project, Including General Plan Amendment (No. 20-2501), Zone Change (No. 20-3502), Specific Plan (No. 20-2002), Tentative Parcel Map (TPM 38118) and a Development Agreement, for the Development of Industrial and Commercial Uses on a 533.8-acre Project Site Located South of I-10/the Union Pacific Railroad and West of Sunset Avenue.
Alternatively, Approve the Project Applications as recommended by Staff by Adopting:
(1) Resolution 2026-28 Certifying the Environmental Impact Report, SCH No. 2021020011, Including Related Findings, Statement of Overriding Considerations, and Mitigation Monitoring and Reporting Program; and
(2) Resolution 2026-29 Approving the General Plan Amendment (No. 20-2501); and (3) Resolution 2026-30 Approving Annexation of 253.7 Acres into the City of Banning; and (4) Resolution 2026-31 Approving the Tentative Parcel Map (TPM 38118); and (5) Introducing by Title Only the Following Ordinances:
Ordinance 1618, Approving Zone Change (No. 20-3502);
Ordinance 1619, Approving Specific Plan (No. 20-2002); and Ordinance 1620, Approving a Development Agreement Between NP Banning Industrial 3 LLC and the City of Banning.
Mark Staples outlined the proposed applications for the Sunset Crossroads project, including General Plan Amendment 20-2501, Zone Change 20-3502, Specific Plan 20-2002, Tenant Parcel Map 38118, pre-annexation zoning and development agreement, and Environmental Assessment 20-1506 (State Clearinghouse number 2021-10232. 2021-020011), along with General Plan Amendment 22-2502 and Zone Change 22-3502 for the Mt. San Jacinto Community College District. The project site includes a northern half within the city boundary and a southern half in unincorporated Riverside County, requiring annexation. The northern half is to be re-designated as a specific plan, and the southern half pre-zoned as such, pending LAFCO approval. Existing general plan and zoning show commercial areas to the north and residential zoning throughout, with open space. Proposed changes maintain commercial to the north, convert much of the residential area to industrial, and preserve open space for natural drainage.
Planning Area 2, a shaded red area, would require a site-specific change to general commercial at a later date. The Sunset Crossroads project proposes commercial and industrial uses on 533.8 acres, including 268,400 square feet of commercial space (medical office, professional office, education, recreation), a 125-room hotel, and up to 5 million square feet of industrial uses (including up to 330 square feet of cold storage). The specific plan text serves as the project zoning document, containing land uses, development standards, design guidelines, and implementation provisions. Planning Area 1 is the general commercial area, while Planning Area 2 (33.8 acres) will need a future amendment for general commercial designation.
Examples of development standards from the specific plan (Chapter 3) were presented, including general commercial and industrial standards for lot size and setbacks. Mark Staples then introduced Nate Smith, Deputy Director of Public Works/City Engineer, to discuss circulation and traffic improvements.
Nate Smith discussed public works improvements related to the city's master plan. The project would require constructing Sunset Avenue to its full width from the Union Pacific Railroad to Westward Avenue, with a partial width improvement south of that point and a bridge crossing over Smith Creek. Dedications are required on Highland Home Road and Sun Lakes Boulevard. Ramp improvements on Sunset Avenue and intersection improvements at Sunset Lincoln, Sunset and Westward, Sun Lakes and Highland Home, and Ramsey Street are planned. These improvements align with circulation element roadways, intersections, and the traffic development impact fee program.
Roadway cross-sections are generally consistent with adopted city sections, with variations in parkway widths. Bike lanes and facilities are proposed. The current adopted truck route Resolution 2005-91) was presented, noting that roadways are not automatically truck routes and local serving businesses are exempt. The city is working towards AB 98 compliance with the general plan update by January 1, 2030.
A truck management plan is required to address community concerns about excessive trucks near Sun Lakes. The plan aims to divert traffic to Sunset Avenue towards the I-10 trade corridor, including signage, lease provisions with penalties for non-compliance, and physical improvements to discourage turns towards Sun Lakes. A traffic coordinator contact with the city and increased enforcement by Banning PD are also planned.
The project would provide additional water system redundancy and looping, benefiting the Sun Lakes community. An alternate water source would be provided via an 18-inch main within Westward Avenue. Non-potable water will be used for landscaping, with extensions to Sun Lakes and Sunset Avenue, and potentially to Sunset and Bobcat. A new gravity sewer backbone line from the Westward Avenue lift station to Sunset is required, eventually leading to the decommissioning of the lift station, which would reduce energy and maintenance demands.
All drainage on the project is set to be self-contained, with no major city-owned drainage system proposed. Stormwater must comply with the Banning-Venie Code, Regional Water Quality Board 4 control measures, and permits from CDFW, U.S. Fish and Wildlife, and Army Corps. The grading plan must comply with Title 18 of the Banning Municipal Code and environmental agency permits, with grading proposed to balance on site.
The Public Works Department developed conditions to ensure necessary infrastructure is built before each building's operation, allowing for flexibility in development sequencing based on market demands. The Planning Commission suggested adding conditions for ramp improvements at I-10 and Sunset (westbound and eastbound right turn lanes) and a traffic signal at Ramsey Street and Highland Home Avenue. These locations are within the city's traffic diff, making the project eligible for diff credit and reimbursement. Nate Smith concluded his presentation and handed it back to Mark Staples.
Mark Staples resumed, discussing design guidelines in Chapter 4 of the specific plan, which aim to ensure quality and character throughout the project. These guidelines assist developers, tenants, builders, engineers, architects, and landscape architects in achieving the desired design. They provide an aesthetic benchmark for future applications, encourage energy-efficient design, and ensure compliance with the City of Banning General Plan and ordinances. Chapter 5 includes implementation measures for land use and development guidelines, assisting city staff in project review.
A tentative parcel map subdivides the industrial and commercial areas into 34 lots (ranging from one to 78 acres) and five lettered lots for common areas or public purposes. The map has been updated to remove financing conveyance purposes and include correct APM numbers. The northern half and southern half (currently in Riverside County) of the map were shown. Mark Staples then introduced Interim City Manager Art Vela to discuss the development agreement.
Interim City Mager Art Vela highlighted notable terms in the development agreement, including an $8 million public benefit fee ($1.44 per square foot) paid in installments, with the first million due before grading permit issuance. The developer can receive up to $2 million in credits towards the $8 million for bringing in a sales tax-generating tenant, such as a fulfillment center. The agreement also includes an accelerated transportation development impact fee payment of $5.1 million for improvements to the Sun Lakes Boulevard extension, intended to help the city cash flow the project.
The developer is offering land for a fire station site, water tank site, electric substation site, and reverse osmosis site, estimated to be worth $5 to $7 million, at no cost to the city. They will also contribute $500,000 for the design and environmental review of a new substation, with total contributions not to exceed $12.5 million, which is estimated to cover the entire construction. This is crucial because the existing Midway substation (20 MVA) is outdated, and the electric utility lacks the funds for replacement. The developer's contribution would fund both the replacement and the capacity needed for their project.
The developer will be reimbursed for the city's share of the substation, partly through the city's transformer equipment and labor (estimated at $2.5 million), and the balance through rate revenues. The current electric rate structure supports this payback. The developer is also dedicating a five-acre park, which they will design, construct, and maintain.
The development agreement mandates a minimum 100-foot buffer between buildings and Bobcat Road, including a 20-foot landscape area. Facility funding includes a $15 million fire station contribution (covering design and construction) and $1 million for fire station equipment (a new fire truck), plus the electric substation contribution. A $750,000 grant contribution can be used to beautify downtown or fund a small business assistance program, such as a revolving loan.
The development agreement includes the formation of a CFD for a special tax on industrial buildings at 20 cents per square foot annually, with an annual escalator and no sunset date. The developer benefits from a seven-year freeze on new impact fees (excluding increases in existing categories). The developer is required to construct or begin construction of 100,000 square feet of commercial retail within 24 months of the first industrial building occupancy, with a $500,000 5 payment to the city every six months if they fail to meet this commitment. The agreement calls for at least two 100,000 square foot retailers, and the developer must submit an amendment to the specific plan and conduct an environmental review to allow retail and commercial in planning area two.
The development agreement was made public on September 10th and November 5th, 2025, with changes made based on Planning Commission discussions. Further revisions have been made in collaboration with the city attorney's office and the developer's team, including a tolling period (to be explained by City Attorney John Pinkney).
A 17 cents per square foot cap on permit fees has been removed due to refined calculations. A provision related to a tax-sharing and reimbursement agreement for the electric substation has also been removed, as the electric rate structure now supports the city's share of the substation cost.
Various other changes clarify the intent of specific provisions.
Interim City Manager Vela presented a table summarizing the fiscal impact of the project, highlighting its timeliness given the recent audit discussion. The 2024 audit identified a serious fiscal challenge and a structural deficit of at least $3 million for the next few years. The annual revenue from the project includes the special tax (20 cents per square foot) and other recurring revenues, totaling over $2.9 million per year. The "other recurring revenues" represent the net surplus after subtracting the city's estimated expenditures for providing services to the development.
One-time revenues total over $37 million, including the public benefit fee (potentially reduced by $2 million), and contributions towards the electric substation. Half of the property is within the county jurisdiction, and upon annexation, the county will retain 75% of the property tax, with the city receiving only 25%. The project is expected to generate over $70 million in impact fee revenue, which is not included in the one-time revenue table as it is a standard requirement for all developments. Interim City Manager Vela concluded his presentation and handed it back to Mark Staples.
Mark Staples outlines the required findings for various project applications as per the municipal code. For general plan amendments, section 17.64.070 lists four items addressed in resolutions 26- 27 (denial) and 28-31 (approval), carrying over findings from the Planning Commission's November 17th meeting. The specific plan adheres to section 17.96.040, emphasizing consistency with the general plan, environmental impact, site suitability, and neighborhood character. Zone change findings are under section 17.116.050, focusing on consistency with the general plan, zoning ordinance, and environmental concerns. The development agreement, unique to each project, is subject to section 17.0.030, ensuring consistency with the general plan, specific plans, and zoning ordinance, while promoting public welfare. The parcel map complies with the Subdivision Map Act, Section 66474, mirroring the seven findings discussed previously for the track map.
Mark Staples resumed, stating that he would go through the last of the project slides, mostly dealing with the required findings that are required with every project application. With all the application types, there are a couple slides to get through. He stated that he would not read through them all, but this is the list of required findings per the municipal code for general plan amendments. He pointed out the four items there per section 17.64.070. He stated that these items are all addressed both in the different resolutions that are before the council. He stated that the first two, resolutions 26 and 27, are what could be called the denial resolutions, and that resolutions 28 through 31 are the approval resolutions.
The project's environmental compliance timeline dates back to February 2021, with the circulation of the EIR notice of preparation. A scoping session followed two weeks later. The draft EIR was published in December 2023, with a comment period yielding 54 letters. The final EIR was published in July 2024. Due to unavoidable impacts on air quality, greenhouse gas emissions, noise, and transportation, Council must make findings and adopt statements of overriding considerations for approval. The draft EIR covers the summary, introduction, project description, environmental analysis, density change to Mt. San Jacinto College, cumulative impacts, CEQA topics, alternatives, and preparers, along with technical appendices. The final EIR focuses on responses to comments, draft EIR text revisions, the mitigation monitoring and reporting program, findings of fact, and 6 statement of overriding considerations, supplemented by a memorandum from September 10th, 2025.
The Mt. San Jacinto project involves general plan application 22-2502 and zone change 22-3502, transferring 1146 potential residential units from Sunset Crossroads to the Mt. San Jacinto College property. This includes rezoning 41 acres of the 49.2-acre area from public facilities/school to very high-density residential. The Sunset Crossroads project must also adhere to general plan amendment findings (section 17.64.070) and zone change findings (section 17.116.050). The Council has two groups of decisions: denying the EIR and project per the Planning Commission's recommendation or approving the project. The Planning Commission initially voted 3-2 to recommend denial on September 10th, then adopted denial resolutions on November 17th, 2025.
Resolution 2026-26 rejects the EIR certification, while resolution 2026-27 denies the applications for the 533-acre site. Approval resolutions include 2026-28 (EIR certification), 2026-29 (general plan amendment), 30 (annexation resolution for LAFCO), and 31 (tentative parcel map 38118). Three ordinances are needed to approve Zone Change 20-3502, Specific Plan 20-2002, and the development agreement 1620.
Council Member Flynn inquiries about the removal of cold storage, the Sunset Avenue ramp improvements, and AB 98 compliance. Mark Staples clarifies that the cold storage was removed from the 33-acre planning area. Nate Smith explains that the Sunset ramp improvements are part of the DIF program, with the developer potentially making right-hand turn improvements and receiving DIF credit. The Caltrans process could take about 18 months, but there are no current plans.
Caltrans was notified about the EIR but did not respond. Regarding AB 98 compliance, Nate Smith states that Banning is not listed as a warehouse-impacted area and, as a jurisdiction under 50,000 residents, has a compliance date of 2030. The city will evaluate truck routes in coordination with Beaumont as part of the general plan update.
Council Member Flynn questions the designation of Sun Lakes Boulevard west of Highland Home as a truck route. Nate Smith clarifies that it is not currently a truck route and would require a separate council action. He notes the section to Highland Springs is designated for 10,000 pounds or less.
Regarding prohibiting trucks from turning right from the extension past Highland Home to Highland Springs, Nate Smith mentions the applicant's proposed intersection control with narrower lanes. He also addresses the proposed signal at Ramsey and Highland Home, stating it was not included as a condition of approval due to its location on the opposite side of the freeway, but the traffic study shows a potential impact. A signal at Highland Home and Sun Lakes Boulevard extension is not planned at this point, pending a more detailed traffic analysis. Council Member Flynn asks about the transformer for the electric substation.
Interim City Manager Art Vela estimates the transformer has been at the yard for about two years, purchased for the Midway substation replacement. He confirms the CFD is a service special tax, found in section 6.2.2 C of the development agreement, and requires property owner approval.
Council Member Flynn notes the development agreement was published recently and is labeled as a draft. Mark Staples clarifies it's the most final version. Council Member Flynn questions if the project is null and void if LAFCO denies annexation. Mark Staples believes only the southern portion's development rights would be affected, but Council Member Flynn cites section 4.2 on page 29, stating the owner reserves the right to terminate the agreement if LAFCO denies annexation. Mark Staples acknowledges this is the owner's decision.
Council Member Flynn raises concerns about the retail development obligation, noting the 100,000 square feet of commercial use is required within 24 months after the first final certificate of occupancy for a project warehouse, potentially delaying the retail development. She also questions the market feasibility study requirement for Planning Area 2, fearing another warehouse if the study deems commercial retail unviable. Mark Staples acknowledges the change to commercial was a late addition based on feedback. City Manager Vela agrees with Council Member Flynn's concerns, suggesting the 24-month clock should start sooner and emphasizing the city's intent for commercial and retail use regardless of the market study.
7 Council Member Flynn prefers the retail development clock to start with permitting, not occupancy.
Mark Staples clarifies that occupancy refers to the final inspection, not necessarily a physical presence. Council Member Flynn then questions the special account for public benefit fees until the Sun Lakes Boulevard extension is completed. Interim City Manager Vela explains this provision was added early on when the city lacked full funding for the extension, but the project is now fully funded, so the fees won't be used for the road. Council Member Flynn asks if the city will miss out on the money. Interim City Manager Vela confirms the city will still receive the money per the installment schedule. Council Member Flynn expresses concern about the first installment of the public benefit fee being paid prior to the first grading permit, potentially delaying payment for years. She wants to see fees paid sooner.
Council Member Wallace seeks clarification from Nate Smith regarding truck routes, specifically ensuring Sun Lakes Boulevard is not designated as one. Nate Smith confirms it is not and would require separate council action. Mayor Royce raises the issue of defining "construction" within the contract agreement, questioning whether it refers to permit issuance, groundbreaking, building completion, or occupancy. Interim City Manager Vela suggests the definition depends on the context and should be clarified in each provision where the term is used. Mark Staples suggests tying it to building department standards, where work is expected to begin within six months of permit issuance.
Brent Miles, one of the owners and founders of North Point, introduces the firm, highlighting its position as the largest privately held landlord in the United States with over $20 billion in assets under management. He emphasizes North Point's experience with California regulations and its commitment to investing in communities through thoughtful planning and public input. Miles states the project will create generational economic impact for Banning. He acknowledges the Council's difficult decision and aims to demonstrate transparency, openness, collaboration, and partnership.
Miles expresses eagerness to begin the project, noting North Point purchased the property from a residential developer in June 2020. He highlights the team of professionals involved in creating a robust plan. Miles claims this project has the largest amount of public benefit North Point has ever given, representing almost a $1 billion investment in Banning.
Brent Miles emphasizes the significant public benefit of the project, estimating it as a near $1 billion investment in Banning. He addresses concerns about distrust in developers, assuring commitment to working with the city attorney to ensure transparency in payments. The project aims to transform the community by introducing retail, grocery stores, restaurants, hotels, entertainment, and services, with a signed contract with an anchor tenant. Miles highlights the creation of approximately 4,000 permanent jobs, infrastructure improvements, funding for a fire station and equipment, and a partnership to address Banning Electric's issues. Land donation for parks, along with their construction and maintenance, is also part of the plan. The development agreement is structured to protect the city without incurring costs, featuring a high CFD fee. Miles points out the elimination of cold storage plans and the addition of a 100-foot buffer in response to community feedback, ensuring AB 98 compliance. He also mentions the reduction of industrial square footage and the relocation of the fire station, emphasizing the importance of the anchor tenant and the donation of land to the retail user.
Brent Miles reiterates the public benefits, including the retail timing penalty, special facilities tax, and fire station funding, clarifying that the city retains the fire station funds if an agreement with Riverside County isn't reached. He highlights a grant for small businesses and the donation of land and easements for the Banning Electric substation and Sun Lakes Boulevard extension. A two-week job look-ahead for Banning residents and a partnership with MSJC are proposed to ensure local job creation. Financial impacts are tied to the certificate of occupancy, with flexibility in payment timing.
Infrastructure improvements, including the Sun Lakes Boulevard extension and upgrades to Sunset, Lincoln, Bobcat, and Highland Home roadways, are valued at $42 million. Other benefits include the donation of right-of-way, a substation, a fire station, a water storage tank, an osmosis center, and parkland. Miles expresses excitement about bringing new shopping opportunities and a first-class fire station and parks to the community. He acknowledges the project's impacts, including sound, traffic, and noise, and explains the mitigation efforts. The sound impact is addressed, noting that the 8 project only exceeds sound variance during the construction of Sunset, with a temporary sound wall proposed as a solution.
Brent Miles discusses the traffic management plan, emphasizing no truck traffic west on SLB and proposing a headache bar solution. He highlights the use of sound walls, buffering, and landscaping to mitigate noise, stating that the project does not exceed sound limits except during Sunset construction. Miles argues that residential development is not viable on the site due to infrastructure costs and the presence of arroyos. He emphasizes the project's billion-dollar investment, commitment to paying fees, and desire to bring amenities and jobs to the community. Miles seeks a partnership to create a project that benefits the community, acknowledging the courage required to approve such a project and the potential for opposition. He believes the project's benefits outweigh the drawbacks.
Council Member Flynn inquires about the anchor tenant, which Miles confirms is a grocery-anchored retailer but cannot be publicly named. She questions the usability of the 65 acres of public park land, noting that much of it consists of culverts and ravines, and expresses concern about the existing homeless population in the area. Miles suggests that increased activity will deter homelessness and offers to consider providing more land for pure park space. Flynn emphasizes the ongoing issue of homelessness on the property and asks about plans for addressing it.
Council Member Flynn raises concerns about the lack of plans and funding for staffing the proposed fire station. Brent Miles suggests staff can better address the funding issue. Council Member Flynn requests a permanent sound wall north of Sun Lakes Boulevard on Highland Home Road to buffer the view and noise for the Sun Lakes community. Miles agrees to explore the sound wall. City Manger Vela explains that the project is projected to bring a net annual fiscal surplus to the city, part of which could be used for fire services, and mentions the possibility of a citywide CFD service to fund fire and police. He also suggests cost-sharing with the City of Beaumont. Brent Miles adds that the park land could potentially be expanded from five to twelve acres.
Councilman Miller expresses concern that the $16 million allocated for the fire station and equipment may not be sufficient due to rising costs. Brent Miles offers to increase the funding and tie it to a CPI inflator. Council Member Wallace asks the Fire Chief Hopkins about staffing the fire station once it's built. Fire Chief Hopkins explains that the city can request staffing through a letter, and the costs would depend on the type of resource placed there. He emphasizes the need for a fire station on the south side of the freeway and its potential to improve coverage in the city. Council Member Flynn clarifies the desired extent of the sound wall along Highland Home Road, requesting it extend to the substation for continuity.
Fire Chief Hopkins discussed the potential costs and benefits of establishing a fire station on the south side of Beaumont, emphasizing the current lack of coverage in that area and the reliance on stations in Cabazon (often blocked by trains) or Poppet Flats. He mentioned that staffing costs would depend on the type of resource deployed. Moving Engine 20 to the new station and adding equipment to the Wilson station could improve coverage for Atwell and other north-side communities. The Fire Chief offered to provide cost estimates for fire equipment, noting that a fully outfitted fire engine currently costs around $1.7 million, while a truck like the one purchased by Beaumont cost $2.4 million plus outfitting expenses. The estimated cost for a new fire station is around $8 million, potentially excluding land costs, but the city has architecture drawings available to help reduce costs. Projections have been made regarding response times from potential fire station locations off Sunset and at the Wilson site, aiming for a four-to-five-minute response time. Other fire stations being built in the county are estimated to cost around $12 million or more.
Charlene So from Urban Crossroads stated that the modified project now anticipates 1,850 trucks per day on Sunset Avenue daily, a reduction from the original estimate of 3,200 due to project modifications. The traffic study primarily focuses on morning and evening peak hours, revealing slightly more truck traffic in the morning (about 100 trucks more). While truck activity generally occurs outside peak commute hours, there could be truck traffic between 7-9 PM. The industrial traffic pattern is inverse to residential traffic, with higher inbound traffic in the morning and higher outbound traffic in the afternoon, potentially mitigating congestion during peak commute times. 9 Council Member Flynn questioned the significant reduction in truck traffic (from 3,200 to 1,800) despite the removal of only 500,000 square feet of warehouse space. Brent Miles clarified that the removal of 330,000 square feet of cold storage, along with the elimination of the truck stop as a permitted use, significantly contributed to the reduction in truck traffic. Cold storage and truck stops have a disproportionately high impact on truck volume compared to standard warehouse space.
Council Member Flynn requested that the updated traffic study memo be provided to the entire council for review.
Mayor Royce questioned Brent Miles about comparable mixed-use projects in California. Brent Miles mentioned a large project near the Sacramento airport and retail developments in Kansas City and Detroit, but not a similar mixed-use project in California. He stated that his company has developed 30,000 residential units across the U.S. Mayor Royce expressed concern about the high number of vacant warehouses in Riverside County and asked if tenants were secured for the proposed warehouses. Brent Miles stated that he doesn't have tenants yet because he doesn't know when construction will begin. He cited a 5.2% vacancy rate for IE East, indicating a tight market. Council Member Flynn expressed concern that the warehouses might remain empty, referencing the Skechers building and other vacant properties in Cherry Valley. Brent Miles stated that the Skechers issue is related to foreign trade zone status, not a lack of demand. He disagreed with the notion of a downturn in warehousing, asserting that the region is the most robust industrial market globally.
Council Member Flynn suggested a condition requiring a tenant to be secured before building each subsequent warehouse. Brent Miles expressed openness to discussing language around this but highlighted the financial risk of building additional vacant warehouses. Council Member Flynn emphasized the community's concern about potential empty warehouses, given the history of vacant properties and the rezoning of land previously designated for single-family homes. She worried about the negative impact on surrounding communities if the warehouses remain unoccupied and do not benefit the city. Brent Miles pointed out that he would still be paying fees and taxes even if the buildings were vacant. City Manager Vela added that vacant warehouses would generate revenue through CFD and property taxes without placing demands on city services like traffic management.
Mayor Royce expressed concern that empty warehouses could attract crime and blight, potentially exceeding the revenue generated. Brent Miles stated that less than 2%, possibly less than 1%, of his California properties are currently vacant. Mayor Royce inquired about the intended use of the warehouses, specifically whether they would be used for "point of sale" activities. Brent Miles explained that point of sale taxation in California is complex and depends on the tenant's other facilities. He mentioned Chewy.com as an example of a point-of-sale tenant in Missouri. Brent Miles estimated that 20% of their California portfolio involves point of sale. He believes that the Banning location is a "home-run site" and that he has the capital ready for the project. He noted that last year, his company leased 15.6 million square feet, with 9.8 million square feet coming from existing Fortune 500 tenants.
Brent Miles clarified that the plans include dedicated truck parking spaces, separate from loading and unloading docks. These spaces are intended for trucks staging between loads. Mayor Royce expressed concern about trucks spilling over onto city roads, a common problem in other cities with large distribution centers. Brent Miles assured that the site has ample land coverage (22-25%) compared to typical industrial developments (35-38%), allowing for sufficient on-site storage and queuing. City Manager Vela emphasized the longer throats leading into the buildings, providing more on-site storage capacity for trucks. Brent Miles stated that the internal road networks are designed to prevent trucks from queuing on public streets. He expressed confidence in leasing the buildings due to their state-of-the-art design and ample parking.
Mayor Royce Opened Public Hearing at 7:50 p.m.
• A resident highlights key issues previously raised: electricity bills, warehouses, and animal care. urges the council to consider whether the current project is truly in the city's best interest, noting resident opposition to empty warehouses and uncertainty about future buyers and the economy. • Richard McCard expresses concerns about the incompatibility of warehouses with neighboring residential areas and focuses on traffic impacts. He cites a figure of 1,850 trucks per day, 10 exceeding one truck per minute. He raises concerns about ambulance and police access, added load on the 10 freeway, noise, and pollution. He questions truck routing via Sun Lakes Boulevard to Sunset Blvd. and suggests the airport as a more suitable location. • Chuck Huff emphasizes that the council's loyalty should be to residents, not freight traffic. He criticizes the council's credibility, citing the San Gorgonio Inn and a drag racetrack. He recalls previous claims about the impossibility of extending Sun Lakes Boulevard due to dangerous pipelines. He highlights traffic problems on Sunset and Lincoln, the impact on fire engine access despite the $35 million underpass, and the increase in decibel levels from sirens. He also mentions the shift from rural land to high-density housing and commercial development. • A resident asks if homeowners in Serrano Del Vista will be reimbursed if truck traffic on Sunset lowers property values.
• John, representing union plumbers, pipe fitters, and refrigeration workers, finds it ironic that people complain about warehouses while ordering online. He challenges the vacancy rate argument, citing statistics of approximately 5% vacancy in the general area and 8% county-wide, suggesting a 92% chance of occupancy. He proposes organizing warehouses with tiered wage systems, higher salaries based on seniority, supervisors with higher pay, and union representation. He urges the council not to turn down this opportunity. • Jack Marty, a Banning resident with logistics and trucking experience, notes the presentation sounded better than previous ones. He recalls citizen opposition to warehouses and marijuana facilities, preferring grocery stores and retail. He expresses concern about 80 trucks per hour accessing the freeway, predicting a "nightmare." He also mentions fumes, drugs, overnight truck parking, and the potential for lawsuits forcing the opening of Sun Lakes Boulevard to truckers. • Ashley Adams, a lifelong Banning resident and mother, acknowledges setbacks but emphasizes the need to consider the future for her child and other children. She highlights the jobs, entertainment, and food the plan could bring, urging the council to work out the details and consider the expectations of the younger generation.
• Tara Hagee, a Banning resident and caregiver in Sun Lakes, admires the area's environment and nature. She notes the existing 11 industrial, two commercial, and four residential projects already in the works. She argues for legacy over quick fixes, emphasizing community, small business, sustainable jobs, and environmental alignment. She urges consideration of the proposal's economic, health, and longevity impacts.
• Edward Espinosa clarifies factual points about the Sunset Crossroads project, including the 30- year development agreement and the $8 million public benefit fee being contingent on building construction and occupancy. He notes that the fire station, water reservoir, and other public facilities are based on phased needs, not automatic construction. He states that the warehouse and commercial components are market-driven and phased, with no mandatory build-out date.
He also mentions the illustrative nature of the presented map and the lack of fixed warehouse sizes or layouts. He suggests ways for the city to protect itself, such as performance bonds and permit-based phasing. He raises concerns about decibel levels affecting seniors with hearing aids.
• Kathy Aranda formally opposes the Sunset Crossroads project, calling it the wrong project in the wrong location. She emphasizes the Planning Commission's recommendation for denial. She notes the permanent rezoning and annexation of over 500 acres, allowing over 5.5 million square feet of industrial warehouse development. She highlights the Environment Impact Report's acknowledgement of significant unavoidable impacts, including air quality, noise, traffic, and quality of life effects. She argues that environmental review identifies impacts but does not justify them, and rezoning makes those impacts permanent. She urges the council to deny the project, consistent with the Planning Commission's recommendation. • Amy Pippinger expresses agreement with the previous speaker. If the project passes, she insists on a stoplight or stop sign at Highland Home and Sun Lakes. She raises concerns about student 11 and resident traffic on Sunset, especially near Westward, and the potential for problems with teenage drivers and semi-trucks. She believes the developer should have proposed a project consistent with the existing zoning. She also requests a buffer on Bobcat for horse trailers. • Nick Weyrich, Senior Vice President at SRS Real Estate Partners, explains his firm was hired to secure retail tenants for the project's commercial component. He argues this is a transformational opportunity for Banning, potentially bringing a major nationally recognized retail anchor tenant. He emphasizes the competitive landscape with other sites in Beaumont and Calimesa. He states that the logistics component subsidizes the deal, making it attractive to retailers. He believes the anchor tenant will attract other retailers, creating a diverse mix of uses and a first-class amenity for the city.
• Lee Park, a partner at Axiom Retail Advisors, represents a nationally recognized big box retail client in advanced negotiations with North Point. He expresses strong support for the project, citing the potential for good local jobs, substantial tax revenue, and secured future growth. He emphasizes the client's real interest but ties their ability to move forward to the industrial component and its infrastructure. He warns that delays could lead the client to deploy resources elsewhere, making Banning no longer viable. He believes North Point is the right steward for the property and that the time for approval has come.
• Juanita Diaz expresses concern that the community is not adequately involved and convinced of the project's benefits. She feels information is often left out and that last-minute document releases are designed to confuse residents. She requests the council to deny the project with prejudice due to inadequate information.
• Louie Lopez, business agent for Ironworkers Local 433, highlights the "endless opportunity" promised by the city's motto. He seeks to recruit more Banning residents into the ironworkers, especially veterans through a direct entry program. He emphasizes the community benefits offered by North Point, stating he has never seen a developer willing to give so much to the community. He notes that union ironworkers start at $30 an hour as first-period apprentices, emphasizing the value of on-the-job skill training.
• Chuck Huff, a 52-year member of Local 250 Steam Fitter, acknowledges the improvements made to the project over the years. He admits that change is hard, especially for long-time residents. He notes his community's proximity to the project and its potential impact. He acknowledges the reduction in warehouses and the removal of the refrigeration component. He connects the project to the college and high-density housing, questioning the affordability of housing for retail workers earning $20 an hour. He commends the developers but remains hesitant about the change, understanding the need for jobs. • Fran Hanrati asks the city council to be careful in their decision, suggesting the amount of warehouse square footage is excessive. She emphasizes the city's beautiful surroundings and its status as a blue zone city, highlighting the importance of clean air. She requests a revision to reduce the warehouse square footage.
• A resident addresses the potential uses of warehouses, citing examples of sports arenas, eateries, and chef classes. Emphasize the potential for community benefit and job creation, particularly in carpentry, ironworking, and electrical trades. • A resident suggests relocating the project to the airport, creating a win-win situation for everyone and avoiding truck traffic near homes.
• Ron Roy supports the Planning Commission's recommendation to deny the project, reflecting the community's wishes for the 534 acres. He suggests the city staff's support for the developer stems from private meetings and communications without comparable public input. He asks the council to require the developer to reduce the industrial warehouse footprint and expand on existing general plan land uses, suggesting less than 160 acres or 30% of total acreage away from homes. He also mentions available industrial land east of Hathaway. He argues that the future of the 534 acres should reflect the Planning Commission and community's vision, not the 12 developer's, criticizing the developer's unchanging monolithic vision since 2021, where warehouses dominate 74% of the land use. He requests the Council to require the developer to reduce the industrial warehouse footprint and expand on existing general plan land uses, suggesting less than 160 acres or 30% of total acreage away from homes for industrial use. He believes more diverse land uses would create better dynamics and value. • Carlos Esparza expresses his support for the project, mentioning his desire for a new park and nearby work opportunities. As a member of Iron Workers Local 433, he emphasizes the need for opportunities for young people, highlighting the union's apprenticeship programs for veterans and others
Mayor Royce Closed Public Hearing at 8:36 p.m.
Brent Miles with North Point addresses concerns, stating that fire services were prioritized based on staff input and that they have never seen property value decline near their industrial projects, citing examples in Kansas City and Edgerton, Kansas. They clarify that weed is a prohibited use due to their financial partners' restrictions inside warehouses. They emphasize the benefits of the 30-year development agreement, including guaranteed fees and an upfront payment of $7 million. They also highlight the explicit details of the development agreement regarding upfront payments.
Brent Miles addresses concerns about sound, stating that the human ear cannot detect decibel changes of less than three decibels, while the project's noise impact is much lower. He is willing to discuss the stoplight at Highland with public works and engineering. He also mentioned Hillwood as a competitor in the airport commentary.
Brent Miles clarifies that the industrial buildings will not be built all at once, and the traffic model accounts for full build-out over several years. expresses a shared desire to avoid vacant buildings and offer to provide a more detailed illustration of the traffic model, including signal locations, turn lanes, and time frames.
Brent Miles is unsure about the electrical substation and offers to consider how the project can help with other city needs like animal control. Council Member Flynn expresses concern about the amount of warehouses and square footage, suggesting the inclusion of more retail, commercial, and medical facilities.
Brent Miles agrees to consider alternative land uses but cautions that changes to the industrial square footage could impact on the financial viability of the project and the public benefit package.
Emphasizes that the development agreement was heavily negotiated and that industrial use is the primary financial driver.
Mayor Royce points out the conflict between the developer's financial interest in warehouses and the city's need for retail. The applicant representative acknowledges the community's desire for retail but argues that industrial development generates more fees and is a more reliable financial producer. They estimate that the retail development could generate $2.5 million in sales tax.
Council Member Miller raises concerns about truck traffic and asks if some warehouses could be used for other purposes. The applicant representative explains that traffic is modeled based on warehouse square footage and that they actively monitor traffic to minimize problems, as excessive truck traffic is undesirable for both the developer and potential tenants. He highlight the $46 million investment in infrastructure to manage traffic.
Mayor Royce suggests a traffic study model predicting traffic in two to three years. The applicant representative and Charlene So from Urban Crossroads clarify that the traffic study looks at various time horizons, including existing conditions, project phases, cumulative projects, and a horizon year of 2045.
Council Member Flynn emphasizes that various commercial uses beyond retail are possible and 13 that warehouses generate 24/7 truck traffic, unlike medical or retail buildings. She expresses concern about the potential impact of 80 trucks per hour on the on and off ramps and suggests reducing the warehouse area south of Sun Lakes Blvd.
Brent Miles reiterates their efforts to minimize truck traffic and balance community needs with the development agreement. Councilmember Flynn questions the guarantee of LAFCO approval for the county land south of Sun Lakes Boulevard and the potential for the developer to withdraw if it's not approved.
J.J. Jenkins with Northpoint confirms that a survey was conducted in a disadvantaged unincorporated community, and residents chose not to join the city.
Council Member Wallace emphasizes the need for economic development in Banning, highlighting the city's fiscal challenges and the importance of adapting to change. She argues that the Planning Commission's denial of projects is hurting the city and that Banning needs to attract businesses to avoid being bypassed by other booming cities. She stresses the need for a change in mindset to support economic growth for the benefit of future generations.
Charlene So, with Urban Crossroads confirms the original traffic study was completed on August 9th, 2023, with subsequent technical memos, including one dated September 3rd, 2025.
Deputy City Clerk, Sandra Calderon reports receiving seven letters in support and 416 letters in opposition to the project, distributed to the council. Councilman Wallace reiterates that the project impacts the entire city of Banning.
Council Member Flynn moves to continue the discussion to a future date, citing the late release of the development agreement and a 10-page letter received from Sunset Crossroads. She argues that the council needs more time to digest these documents and the traffic study. The motion is seconded by Council Member Barrington. Motion carried 4-1 with Council Member Wallace voting no.
City Attorney Pinkney clarifies that continuing the public hearing to a date certain avoids the need for re-noticing. The discussion clarifies that agenda items 6-1 and 6-2 are related to the same project and can be continued together.
Councilmember Flynn suggests hearing agenda item 6-2, which involves the general plan amendment and zone change, as it is a separate issue involving the city and Mt. San Jacinto College, not North Point.
Mark Staples, Senior Planner proceeds to present the next item 6.2.
6.2 Consideration of an Application by the City of Banning, CA for General Plan Amendment (Case No. GPA 22-2502) and Zone Change (Case No. ZC 22-3502) to Amend the Land Use Designation and Zoning of Approximately 41 acres of Land Owned by Mount San Jacinto Community College District Located Near the Southeast Corner of Westward and Sunset Avenues from PF–S (Public Facilities-Schools) to Very High Density Residential (VHDR) to Transfer Density of Not Less Than 1,146 Residential Units from the Sunset Crossroads Specific Plan.
Recommendation: 1. Adopt Resolution 2026-33, DENYING the project proposals of General Plan Amendment (Case No. GPA 22-2502) and Zone Change (Case No. ZC 22-3502)
2. Adopt Resolution 2026-34, APPROVING the project proposals of a General Plan Amendment (Case No. GPA 22-2502) and Zone Change (Case No. ZC 22-3502) Mark Staples, Senior Planner proceeds to present on the residential land use transfer, explaining that it complies with state law regarding no net loss of residential land uses and is tied to the housing element. Another site was needed to accommodate the 1,146 units. Explaining the prior residential land uses in the area, referencing the "no net loss law" passed around 2021 or 2022 and its connection to the housing element. To compensate for the loss of 1,146 units, previous 14 directors contacted Mt. San Jacinto College, who were willing to take on the residential unit total, but wouldn't provide a formal letter of commitment. The presentation includes approval and denial resolutions tied to the North Point project and resolutions approving general plan 22-2502 and zone change 22-3502, specific to the college district's properties.
Council Member Flynn questioned the college's willingness without a formal commitment and the implications of transferring 1,146 low-density homes to a property not owned by the city, suggesting it's merely a "paper trade" to satisfy state housing policy. She expressed concern about losing these homes and the potential repercussions from HCD. She emphasized the Planning Commission's opposition to the project and the need for rooftops to support local businesses.
Mark Staples stated that the MSJC district generally accepted the responsibility for the 1,146 units.
They mentioned the possibility of further transfer development rights. Council Member Flynn questioned the density required to accommodate that many units, and Mark clarified it would be roughly 27 units per acre, similar to recently built three-story apartments.
Mayor Royce opened public comments.
• Amy Pippinger speculated that MSJC might be amenable to the proposal because Diversified Pacific could purchase the land for apartments. She expressed her opposition to the plan. • Tara Hagee questioned the logic of voting on the proposal without guarantees and its contingency on the other proposal, suggesting it be revisited with a committed site. The developer representative stated the MSJC site was considered in the EIR for the North Point project due to SB 330 requirements. He clarified that the MSJC site is intended for job development, not housing, and wouldn't preclude future school facilities. He also mentioned the 1,146 units were analyzed programmatically in the EIR and traffic analysis, with a housing range of 24-30 DU per acre, potentially in a clustered, three-story format. • Shirley Hagey noted the reduced audience and expressed concern that the community wasn't adequately informed about the rezoning. She suggested delaying the decision for more public input. John Kond, counsel for the developer, emphasized the legal requirement under SB 330 to handle the North Point project and the zone change simultaneously. He clarified that state law only requires capacity, and the 1,146 units were merely shifted, not built or planned, similar to the previous situation with Lennar and the Sunset Crossroads property. • Juanita Diaz expressed concern about the number of warehouses and questioned whether the city was prioritizing the community's needs. She emphasized the need for affordable housing and raised concerns about MSJC's potential departure. The meeting host then opened the floor for council discussion, deferring to legal counsel regarding separating or combining the items.
The City Attorney advised handling the two items together as they are applications for one project.
Mayor Royce closed public comments
City Attorney, Pinkney suggested continuing the public hearing to February 26th to allow for the inclusion of missing ordinances. A motion was made to continue the meeting to February 26th.
Councilmember Flynn inquired about the impact of the Rancho San Gregorio project (3,500 homes) on traffic. Staff confirmed the EIR accounted for Rancho San Gregorio as an existing approved project from 2016.
Council Member Flynn sought clarification on the car traffic numbers in addition to the 1,800-truck count.
Mark Staples indicated they would need to defer to traffic experts for specific car traffic numbers but estimated Island Springs had 30,000+ cars per day. Mayor Pro Tem Barrington pointed out that Rancho San Gregorio traffic would use multiple streets, not just Sunset. Council Member Flynn requested clear data on truck and car traffic. Mark Staples committed to translating the technical traffic data into an understandable narrative.
15 7. ADJOURNMENT
A motion was made by Mayor Royce and seconded by Council Member Miller to continue items 6-1 and 6-2 to February 26th at 5 p.m., motioned carried 5-0. Meeting was adjourned 9:32 p.m.
Minutes prepared by:
Sandra B. Calderon
Deputy City Clerk
These minutes have been prepared as Summary Minutes in accordance with City Council Resolution 2025-22 and Government Code Sections 36814, 40801, and 54953(c)(2).
The entire discussion of this meeting may be viewed here:
https://banningca.granicus.com/player/clip/282?view_id=1&redirect=true