The hospital, which is between those streets, owns most of the properties on the west side of Coldbrook Avenue and along Seventh Street, Massimilla said.
Permitted uses include outpatient care, professional offices, medical laboratories and other support services for a hospital, according to the proposed amendment to the borough zoning ordinance.
Earlier this year, the hospital announced plans for an $11 million expansion of its emergency room scheduled to begin this fall. It is looking at an addition to the cancer treatment center on the 21.5-acre campus and a patient treatment facility as part of a $40 million building program over three to five years.
In June, the borough's zoning hearing board approved a variance and special exceptions that allow the project to move forward.
"It is in a residentially zoned area and the hospital is a nonconforming use," Council President William McLaughlin said.
Massimilla said that is one reason the hospital wants the district.
"Every time we do something, we need to go to the zoning hearing board, so that's why this district makes sense," he said. "You've got to plan for the future and this is one way to do it."
That is one reason Carl Miller said he is against a district, if it includes Coldbrook and Seventh.
"The current zoning allows the hospital to have special exceptions for parking, medical buildings or such," the Sixth Street resident said. "They must go to the zoning hearing board to get that and that allows residents to go and express themselves."
Miller said a district would give residents less of a say about what goes next to their properties.
Massimilla said the hospital has held meetings with residents and in June informed them of the plan for the district.
"We altered the zone some because of input from the meeting," he said. Originally, the hospital planned for it to include Sixth Street.
"That's what really set us off with their original proposal," said Larry DiBarry, another Sixth Street resident. "Now it just comes to the end of my property instead of encompassing my property."
DiBarry said he has hospital parking lots on two sides of his property. "I'm concerned about the quality of the neighborhood and the quality of the community," he said.
"We're trying to address the concerns of the neighbors," Massimilla said.
"They're upset because they're losing their privacy. I feel for them," said Councilwoman Ruth Harbaugh, whose Second Ward includes the hospital. Harbaugh said she would rather see the hospital expand its Summit Health Center on Norland Avenue, where there is more undeveloped land.
"Chambersburg Hospital and the quality of care it offers its patients are one of the greatest assets of the Chambersburg area," McLaughlin said when asked his opinion of the plan.
The proposed amendment would be subject to public hearings before the commission and the council before the council votes to approve, reject or change the plan, according to McLaughlin.