rampant_jwalker: The current population of downtown/midtown is about 35,000 people on 4 square miles, and almost a quarter of that is the vacant Railyards and the Capitol Mall/State Capitol complex, which currently don't have any residents. That still averages to 8750 people per square mile, including that vacant chunk. Ten times that, 87,500 people per square mile, is a population density unheard of in the United States: Manhattan is about 70,000 per square mile, San Francisco average about 16,000 per square mile (which, funny enough, is about twice our central city's current density.)
You don't think the entire central city is limited to three stories, do you? Obviously it isn't--and there is plenty of room for vertical growth, especially in spots like the Railyards, Docks and River District. Part of the idea of city planning is providing definable, predictable areas for high-rise urban growth in the urban core, and part of that process means shifting development focus from farther-out point where land is cheap back to the city center.
Another component is maintaining existing urban fabric--lest, as we ended up doing in the 1950s and 60s with redevelopment, destroying so much of the central city that new development is actively harmed (that currently-vacant Capitol Mall area used to be the most densely populated part of the city.) Midtown is currently the brightest spot in our region--declaring open season for development would both deter builders from focusing their attention downtown and snuff out the flourishing urban culture that is happening in the central city.
Doubling the central city's population is a start--through effective use of strategies like alley activation, converting surplus commercial/industrial space to residential use, and high-rise residential in places like the Railyards, the Docks, the River District, Northwest Land Park and West Sacramento, it could be more like a tripling of density--which is more like the overall density of New York City, in the range of 25-30,000 per square mile. All while keeping our parks, and our existing neighborhoods, and adding high-rises and mixed use. But all of that depends largely not on what happens at the center, but what happens at the edges: as long as the Sacramento region continues to expand outward with greenfield suburbs, it's going to steal development energy from growth inward and upward, not just in Sacramento's central city but throughout the region.
Seriously, take a look at the Sacramento 2030 general plan at
http://sacgp.org , check out the land use element and the land use map. It's interesting stuff.