Palm Avenue Trolley Station Transit Oriented Development – Palm City Transit Village


SCH Number
Public Agency
San Diego Metropolitan Transit
Document Title
Palm Avenue Trolley Station Transit Oriented Development – Palm City Transit Village
Document Type
NOE - Notice of Exemption
Document Description
On December 14, 2023, the Board of Directors of the San Diego Metropolitan Transit System authorized the Chief Executive Officer to modify the approved project scope and material terms of the ground lease for the Disposition and Development Agreement with National Community Renaissance of California for the affordable housing portions of the Palm City Village Transit Oriented Development Project (“Project”). The Board further authorized the CEO to amend the approved project scope and material terms of the ground lease for the Disposition and Development Agreement with Malick Infill Corp for the moderate-income housing portions of the Project. On October 14, 2021, the Board had approved a design for the Project that included four buildings with a total of 390 homes/units, 80 exclusive MTS transit patron parking stalls, and 111 exclusive resident parking stalls. Although not required by the DDA, the developer also proposed that their ultimate design would include a childcare facility, outdoor marketplace/plaza, micro mobility stations (i.e. bicycle parking and lockers, scooter area), running loop, picnic area, and others amenities. These developer-proposed amenities were not binding commitments and can be changed as the design process unfolds. The October 2021 Board approval required the developer to prepare a plan to encourage residents to use public transit and reduce the demand for residential parking. In response to increased industry wide building construction costs, in or around May 2023, the developers approached MTS staff with a proposed redesign. To reduce construction costs, the developers proposed six smaller buildings (instead of the approved 4 buildings) and removed the podium construction design where a podium is constructed to allow parking below and housing on top. This allows for a 18% increase in estimated occupancy, buildings to be financed more easily, and a more competitive application for tax credit allocation awards. The amended Project approved by the Board on December 14 includes 160 parking spaces, with 80 of those spaces reserved for MTS’s exclusive use. All of the proposed housing units would be rent restricted, with 304 being restricted to below 80% Area Median Income (AMI), and 102 units being restricted to below 110% AMI. Developer-proposed amenities in the new design include micro-grid battery storage, childcare facility, community rooms, bodega, running loop, linkage to the Otay Valley Regional Park, promenade, bicycle garage and micro mobility stations.

Contact Information

Kena Teon
Agency Name
San Diego Metropolitan Transit System (MTS)
Job Title
Grants Administrator
Contact Types
Lead/Public Agency


San Diego
San Diego
Citywide, Southern California
Cross Streets
Hollister Street

Notice of Exemption

Exempt Status
Type, Section or Code
Sec. 21080(b)(1); 15268
Reasons for Exemption
The modified Project is not subject to environmental review under the California Environmental Quality (“CEQA”), Public Resources Code section 21000 et seq. and its implementing regulations, Title 14 of the California Code of Regulations, section 15000 et seq. (“State CEQA Guidelines”). City of San Diego staff has determined that the modified Project site is zoned RM-1-1, which allows for multi-family residential development of no greater than 29 units per acre. The Project is eligible to apply for a density bonus that would allow a maximum density of unlimited units per acre. The land use and density are allowed by right with the utilization of the affordable housing density bonus regulations and are not subject to discretionary review. Actions that are not a “project” under CEQA or are deemed ministerial approvals do not trigger CEQA review. (State CEQA Guidelines, §§ 15268, 15378.) Likewise, because MTS’s execution of the DDA and implementation of actions necessary to fulfill its obligations under the DDA, including but not limited to execution of a Ground Lease and related regulatory agreements for the development, does not provide MTS with the discretion or authority to address any environmental effects of the development, these actions do not trigger CEQA review. Even if the development were not deemed ministerial, however, it is categorially exempt from CEQA review under State CEQA Guidelines section 15332 (Class 32) because it is in-fill development that (a) is consistent with the applicable general plan designation and applicable general plan policies as well as with applicable zoning designation and regulations; (b) occurs within city limits on a project site of no more than five acres substantially surrounded by urban uses; (c) is located on a project site that has no value as habitat for endangered, rare or threatened species; (d) would not result in any significant effects related to traffic, noise, air quality, or water quality; and (e) is located on a site that can be adequately served by all required utilities and public services. None of exceptions to the categorical exemptions in State CEQA Guidelines section 15300.2 apply. The development is not located in a sensitive environment as the development impact area is within disturbed areas of the site. The cumulative impact of successive projects of the same types in the same place over time would not be significant because the development is limited in size, scope, and distance from any adjacent development and there are no reasonably foreseeable projects that would result in cumulative impacts with the development. Additionally, the development does not involve any unusual circumstances. The development’s circumstances would not differ significantly from the circumstances typical of the class of projects covered by the Class 32 exemption. Accordingly, there is no reasonable possibility the development would have a significant effect on the environment due to unusual circumstances. Further, the development would not result in damage to any scenic resources within a highway officially designated as a state scenic highway; is not located on a site designated pursuant to Government Code 65962.5 (hazardous waste site); and the development does not involve any improvements, modifications, or other changes to an historical resource.
County Clerk
San Diego


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