The five-member group will also put issue on November 2022 ballot

Trammell Crow’s building in a concept illustration.

By Robert Airoldi

After months of discussion and working with residents, the Morgan Hill City Council unanimously passed an emergency ordinance and resolution that effectively prevents all forms of distribution as a primary business.

The joint effort came about after the Morgan Hill Responsible Growth Coalition successfully filed an initiative petition that would have gone to voters and restricted the size of building to prevent distribution and fulfillment centers from operating in the city. Concerned about the impact on the city’s ability to attract and retain business, the council directed staff, residents and the business community to work together to clarify language and develop a solution to meet the intent of the initiative while reducing possible negative economic development impacts.

The results from the April 7 workshop and regular council meeting include:

Staff will update the “Industrial Use Preservation Policy” to explicitly note that all forms of distribution businesses are prohibited in Morgan Hill.

Further bolster the existing city ordinance prohibiting distribution as a primary use by clarifying definitions for ceiling height, dock-high-doors, and light manufacturing uses.

The MHRGC initiative will be replaced with a new city ordinance that prevents future developments from being built with all the physical characteristics of a distribution center

A new measure that mirrors the new city ordinance will be placed on the November 2022 ballot, thus prohibiting a future city council from changing or rescinding the restrictions if approved by voters.

Some people are concerned the new ordinance and resolution may send the message that Morgan Hill is not friendly to businesses.

“We have heard concerns from the business community,” said Assistant City Manager Edith Ramirez. “But if we take a step back, any time there are regulations we hear from developers and brokers and we have been in talks with prospects who are concerned about where we are heading as a business climate.”

Chamber of Commerce President and CEO Brittney Sherman said she has spoken with leaders of at least two businesses concerned about the new ordinance and one told her they won’t consider moving here.

“We’re concerned and want to clearly articulate what we are hearing in an effort to get in front of the idea Morgan Hill is business unfriendly,” she told the council. “We need to change the narrative that we are not just open, but we want business and will advocate for business.”

Mayor Rich Constantine agreed that the perception that Morgan Hill is not business friendly is out there, but that “this process shows what’s best about Morgan Hill.”

Councilmember Yvonne Martinez Beltran said she was thrilled and elated.

“This is really a triumphant moment for our community,” she said.