Farmland preservation, urban sprawl, economic development and long-range planning have collided in the City of Gilroy. Officials are working toward designating 664 acres of tomato fields for high-tech, campus-style development, but opponents of the idea say the city should concentrate on 1,200 acres already designated for industrial growth. What is known as Gilroy's "660 plan" has become a divisive issue in this town of 42,000 people about 25 miles south of San Jose. During the November City Council voters elected two supporters and one opponent of the industrial proposal. The election gives the 660 plan 5-2 backing on the City Council. Despite the apparent political support for the industrial designation, the controversy remains hot, as the Santa Clara County Local Agency Formation Commission is raising questions about what some people see as needless conversion of farmland. "We believe this is fundamentally an argument over where jobs should be located," Mayor Tom Springer said. The argument also encompasses what types of jobs Gilroy should have. For decades, farming has dominated this community along Highway 101 at the upper end of the Coyote Valley. The town has become known as the garlic capital, and its garlic festival attracts tens of thousands of people every year. During the last 20 years, however, Gilroy has evolved into more of a bedroom community, and an estimated 8,000 people now commute from the Gilroy area to Silicon Valley. About 10 years ago, a county task force produced a report recommending ways to keep agriculture alive in the Gilroy area. The plan emphasized "vertical integration" projects that involve food processing and packaging, in addition to the growing of crops. In 1996, the city, the county and LAFCO approved an agreement designating 20-year agricultural boundaries. In exchange for the city's keeping urban development within those boundaries, LAFCO agreed to look favorably on Gilroy annexation requests within the boundaries, according to Neelima Palacherla, LAFCO executive officer. This is where the 660 plan gets sticky because the land involved lies outside the boundary. In fact, Gilroy officials did not get serious about changing the designation of the site until they were nearly three years into a General Plan update and had already released a new draft plan. One of the primary reasons for updating the 20-year-old general plan is to increase the amount of property designated for industrial growth, Planning Division Manager William Faus said. After reviewing the draft general plan in late 1999, the City Council sent planners back to work on a revision that reconsidered 664 acres just east of Highway 101, next to a thriving factory outlet center along the freeway The city's 42-member General Plan Update Committee divided over whether the site was appropriate for industrial development. Eventually, 24 members signed a letter opposing the proposed industrial land use designation — what became known as the 660 plan. When a majority of councilmembers indicated support for the 660 plan during public hearings for the general plan during spring of 2001, committee members said they felt betrayed. By the time of the fall City Council campaign, the 660 plan dominated most political discussion, and the election became a referendum on the idea, said Mayor Springer, who contended that most opponents were out-of-town environmentalists. Voters choose industrial development when they elected 660 plan supporters Craig Gartman and Robert Dillon, and tossed out incumbent Lupe Arellano, who opposed the plan. Nine-year incumbent Charles Morales was the only plan opponent to win in November. Springer said the site is perfect for campus-style development because it is right next to the outlet center, and open land to the south is already zoned for development. The site is within 300 feet of a sewer trunk line and a city well sits on the edge of the property. "It isn't like this is land off to one far side of the city. It is within not only the sphere of influence, but within a stone's throw of the City of Gilroy," Springer said. Moreover, the site is a large block of undeveloped land with only about a dozen owners, so the city would not have to assemble multiple small pieces to attract a big developer, Faus said. But Morales said the 660 plan amounts to "urban sprawl" and is premature. "To me, it doesn't make sense. Let's develop what we have right now," he said. The city already has about 1,200 acres designated for industrial development, and Silicon Valley tech companies have shown little interest in reaching that far south. No one is sure what the demise of Cisco System's proposed Coyote Valley campus means for Gilroy, but it is another indication that the tech building boom is on hold, at least for now. (Cisco had proposed a 6 million-square-foot campus in southern San Jose, less than 20 miles from Gilroy, but the company bailed out of the project late last year because business was so bad.) "The vacancy rate is very high right now, especially with the economy we are in," Morales said. In mid-December, the LAFCO board authorized Palacherla to send a letter to Gilroy outlining concerns about the 660 plan. The LAFCO board did not take a formal position, but, according to the letter, the plan does appear to conflict with the 1996 farmland agreement among the city, LAFCO and the county. The site is prime farmland within the agricultural preserve and much of it lies within the 100-year floodplain, she explained. "The city has well over 40 years worth of vacant industrial land within its city limits," Palacherla said. Springer said there is no reason for LAFCO to get involved now. The city has not filed an annexation request — and probably will not for at least 10 years, he said. He did concede that the site has both flooding and traffic constraints. About one-third of the property would have to remain undeveloped because of potential flooding, and resolving traffic impacts from the build out of a 5,000-employee campus would cost about $140 million, the mayor said. City officials are simply trying to get in position to attract Silicon Valley-type jobs in the future, because Gilroy cannot make it as only a farm town or a commuter village, Springer said. But Morales said if there were strong market interest in building a large tech campus in Gilroy, developers would manage to assemble the needed properties from the existing inventory, he said. The Gilroy City Council is likely to make a final decision on the revised general plan — including the 660 plan — and an associated environmental impact report later this year. Contacts: Tom Springer, Gilroy mayor, (408) 846-0202. Charles Morales, Gilroy councilman, (408) 846-0400. William Faus, Gilroy planning division, (408) 846-0440. Neelima Palacherla, Santa Clara County LAFCO, (408) 299-5127.