24.2.19 in that the City cannot be sure how many developers will pursue a State Density Bonus and to what level, and, therefore, the only units that can be counted toward meeting the RHNA requirement are the units in the base plan and zoning with the lower height limits. This option would likely leave the community looking for more sites to identify for increased residential capacity as part of the Housing Element process in order to demonstrate full compliance with the state laws requiring planning for adequate housing.
The full details for Scenario 3.1 are included in the attachments, along with a three-dimensional rendering showing the overall building massing that are recommended. The project team has also modeled the Planning Commission recommendation, and these materials can also be found in an attachment to this report. Planning staff is recommending Scenario 3.1 as the superior option, because it would result in approximately 350 more units of housing compared to the development expected with the Planning Commission recommendation, it is economically more feasible, and it reshapes the Santa Cruz skyline, identifying the entire downtown as a vibrant urban center serving as an attractor and wayfinding tool for both locals and visitors alike.
Next Steps. Following direction by the City Council, staff and consultants will finalize the project description for the EIR and begin work on the required analyses. The EIR process will take approximately ten months. More specific details and policies of the plan, such as objective design standards, will be drafted during this time and will include further input from the community. Following completion of the required studies, staff will bring the proposed amendments to the Downtown Plan, General Plan, Beach/South of Laurel Plan, Local Coastal Program, Municipal Code and Zoning Maps, together with the Draft EIR, back to the Planning Commission, Downtown Commission, and City Council for recommendation and adoption in the spring and summer of 2023.
HEALTH IN ALL POLICIES. The components of the current proposal are consistent with the Health in All Policies pillars of equity, public health, and sustainabilty in that they would encourage creation of both needed housing and economic opportunities and foster greater accessibility between the Downtown, San Lorenzo River, and beach areas. Development in the Downtown area is in close proximity to transit, jobs, amenities, and a wide range of entertainment and recreational activities, making it one of the most sustainable places to grow in the region. From an equity perspective, the project area will include space for new inclusionary low-income housing, including replacement housing for any existing low- and very-low income residents. This project encourages active transportation modes that support both personal health and environmetnal sustainability.
CEQA: The Downtown Plan Expansion will require environmental review prior to Council’s final consideration. It has been determined that an EIR will be prepared for the project. As the California Coastal Commission recommended, the EIR will include analysis of height and massing alternatives as well as visual simulations of these alternatives. The final proposed amendments to the Downtown Plan, General Plan, Local Coastal Program, Beach/South of Laurel Plan, and Municipal Code, together with the Draft EIR, are anticipated to be considered by the Planning Commission for a recommendation to the City Council by the summer of 2023.
FISCAL IMPACT: This report is part of the grant-funded project to expand the Downtown Plan boundary. The total project cost is currently scoped to be $555,000. Planning was awarded two grants for this project, totaling $450,000, and general fund sources will be used to cover the full cost of the project beyond the grant amount. The City is considering creative solutions to
24.2.20 allow the beneficiaries of the plan to reimburse City general fund costs towards the funding of the plan, including staffing costs associated with the development of the plan, and policies will be considered for incorporation into the final plan to address these reimbursements. Further grant funding may also be pursued, should opportunities arise.
As the project area is built out, staff anticipates that the additional property, admissions, and sales taxes, together with any special assessments elected for the project area, will have positive impacts on the City’s long-term fiscal conditions. Provision of services to the area will result in additional costs to the City, but given the location and efficiency of land uses under consideration, revenues should be expected to exceed expenses. Creating a new urban destination with distinct urban character and a major events venue of regional importance could make this project the center of a highly successful economic development endeavor, bringing residents and visitors from throughout the region into the downtown and helping them navigate between key points of interest at the beach, river levee, and Downtown. Detailed and precise information on the longer-term fiscal implications will not be fully known until new uses and buildings are constructed and operating.
Prepared by:
Sarah Neuse
Senior Planner
Matt VanHua
Principal Planner
Submitted by:
Lee Butler
Director of Planning and
Community Development
Approved by:
Matt Huffaker
City Manager
ATTACHMENTS:
1. Planning Commission Staff Report of May 5, 2022 and attachments
2. Recommended Preferred Development Scenario Materials
3. Planning Commission Preferred Development Scenario Materials
4. Minutes of the Planning Commission from May 5, 2022
5. Staff Responses to Planning Commission’s May 5, 2022 Motion
6. Action Agenda of the Downtown Commission from May 12, 2022
7. Coastal Commission Comments from June 8, 2022
24.2.21 M E M O R A N D U M
DATE: September 2, 2020
TO: Planning Commission
FROM: Lee Butler, Planning Director
SUBJECT: Inclusionary Units in a Density Bonus Project
This memo is intended to provide information to the Planning Commission regarding the process for calculating the required number of inclusionary units and affordable units in a density bonus housing development project. This question has been raised in the past and is provided primarily as information to new commissioners.
Question: Are required inclusionary units also counted as affordable units for the purpose of making a housing development eligible for a density bonus? For example, if a housing development proposes the construction of 10 residential units, it is required to restrict two of the units (20%) as inclusionary units, or units to be made available to low income households. In order for the housing project to be eligible for a 20% density bonus (two additional market rate units), the development would need to restrict 5% of the units for very low income households or 10% for low income households. Could the applicant meet this requirement by providing one of the two required inclusionary units at the affordability level established in the density bonus ordinance? If so, the project would result in ten market rate units (eight of the ten in the base project plus the two market-rate density bonus units), one affordable unit (at the affordability level provided in the density bonus ordinance), and one inclusionary unit.
Answer:
Based on staff analysis and the review of two separate attorneys reviewing the info at the request of staff, inclusionary units can be counted as affordable units for the purpose of density bonus eligibility.
Justification:
Case Law
In 2013, Barbara Kautz of Goldfarb Lipman Attorneys, represented the County of Napa in the case Latinos Unidos del Valle de Napa y Solano v. County of Napa (2013) 217 Cal.
App. 4th 1160 (Partial Publication Attached). At the request of the City, Ms. Kautz
24.2.22 prepared a response to the question posed above, and the following text is an excerpt from her response as it relates to the above-referenced case.
The Court of Appeal held that a developer's provision of affordable units required by a local inclusionary ordinance entitled the developer to a density bonus. (Id. at 1169.) Napa County's density bonus ordinance required developers to provide "target units" (affordable units providing eligibility for a density bonus) in addition to the affordable units required by the County's inclusionary ordinance. Latinos Unidos asserted that this was inconsistent with state density bonus law.
Although the County argued that its provision would result in more affordable housing, the Court disagreed, finding that "section 65915 imposes a clear and unambiguous duty on municipalities to award a density bonus when a developer agrees to dedicate a certain percentage of the overall units in a development to affordable housing." (Id. at 1167.) Regardless of whether the affordable units were provided voluntarily or were required by the County's inclusionary ordinance, if the affordable units qualified the project for a density bonus, the developer was entitled to the bonus and could not be required to provide more affordable units.
Opinion of the City Attorney
The City Attorney’s office analyses of the above case further concludes that the court held that the above referenced Napa ordinance requiring both inclusionary and affordable units was inconsistent with the state density bonus law and therefore invalid, reasoning that, “…allowing the County to increase the number of affordable units required for a density bonus would conflict with subdivision (f) of section 65915, which bases the amount of density bonus on the percentage of affordable housing units in the project.” In summary, according to the Latinos Unidos decision, a developer is allowed to include affordable inclusionary units in the number of affordable target units necessary to qualify for a density bonus. This decision has not been modified or overruled by any subsequent decision and the California legislature has not amended Section 65915 to negate the decision’s holding.
Staff is available for any questions regarding the above topic should you have any.
Enclosures:
• Latinos Unidos del Valle de Napa y Solano v. County of Napa (2013) 217 Cal.
App. 4th 1160 Partial Publication
• Goldfarb Lipman Attorneys Law Alert 7/19/13
24.2.23 24.2.24
24.2.25 24.2.26
24.2.27 24.2.28
24.2.29 24.2.30
24.2.31 1
Rosemary Balsley
From: Ron Pomerantz <[email protected]>
Sent: Monday, January 09, 2023 2:51 PM
To: City Council; [email protected]
Cc: Fred Keeley; Sandy Brown; Sonja Brunner; Shebreh Kalantari-Johnson; Martine Watkins; Renee Golder; Scott Newsome
Subject: Council Agenda for January 10, 2023 Item # 24.1 & 2:Downtown Expansion Area Plan Amendment Revision
Re. Agenda for January 10, 2023 Item # 24.1 & 2: Downtown Expansion Area Plan Amendment Revision Good day Mayor and Council members.
When the Downtown Plan Extension process began the public was led to believe the South of Laurel redevelopment and gentrification process would be comparable to the Downtown Plan. How misleading the City has been. On June 14, 2022 the Council approved 170’ and 150’ buildings to be analyzed in the EIR process. Now the City, led by Mayor Keeley, is attempting to tone down the pending outrage to this overdevelopment proposal. A similar outrage and backlash occurred in the late 1960’s when the Council approved for Lighthouse Field the Hilton Hotel/ Conference Center. The current Staff report pushes back on Mayor Keeley's attempt to ameliorate the fallout from the publicly unpalatable height and density plan proposed in the EIR process.
This issue is not only important for the look and feel and character of Santa Cruz, but how our city is governed.
Our elected officials must be the ones who make policy decisions, not Staff. As flawed as Mayor Keeley’s proposal is, it is more in-line with Santa Cruz’s history and values. The staff report puts forward 12-story buildings throughout the area. The 6+ story Taco Bell project under construction at Laurel and Pacific feels way out of scale. 12 stories nearly doubles the height of the Taco Bell project. The sites originally identified for the 170' and 150’ buildings should be the only sites that the 120’ buildings can be located and not everywhere in the Plan area as proposed in the current staff report. Unlimited 12-story developments instead of 150'-170’ buildings is outrageous and a giveaway to real estate and development interests. This is almost worse than a few 150' to 170’ buildings. 12-story and taller buildings should remain in San Jose not mushroom in Santa Cruz. Try to imagine the process underway and ask yourself if this is the Santa Cruz you have come to know and love? Staff has said the City has no choice but to continue to build massive developments in order to comply with the 3736 units that RHNA requires. To which I say hogwash. There is major Statewide pushback to RHNA and the City of Santa Cruz must join-in, and lead, to not only question the validity of these numbers but to undo these excessive State mandates.
The Downtown Plan Extension appears primarily motivated by the Warriors with everything else rationalizations to support what the Warriors want. When they leave town, and they surely will, we, the community, will be left with their profit-driven vision of land use, and not what a thriving, inclusive, open, and spirited community needs. The planning process must be more inclusive than the wants of the Warriors business organization.
The EIR should be analyzing the project area with 1600 maximum units, not 1800 units. An accurate project description is required under CEQA.
24.2.32 2
The Downtown Plan Extension should plan for no more than 1600 units as Mayor Keeley sets forth. Keep the height and density and set-backs the same as the Downtown Plan. Keep our Local Coastal Plan intact. Simply the Downtown Plan Extension should be in-line with the Downtown Plan, nothing more. The Palomar at 85’ sets the maximum height. At a minimum Mayor Keeley should be supported in his attempt to wrest control over the planning process from Staff. Your decision today could have lasting implications.
Thank you for your time and thoughtful attention.
Ron Pomerantz
24.2.33 1
Rosemary Balsley
From: Jane Mio <[email protected]>
Sent: Monday, January 09, 2023 4:52 PM
To: City Council
Subject: 1/10/23 Agenda Item # 24-24.2 Downtown Expansion Area Plan Amendment Revision Dear Mayor Keeley and City Council Members,
I appreciate the chance to voice my 1/10/23 Agenda Item # 24.-24.2 comments.
Reviewing the ‘ Downtown Expansion Area Plan Amendment Revision - Report from Planning and Community Development (PL)' I have these QUESTIONS:
1. How many total new units are planned for the Downtown Plan, including the S. of Laurel Expansion?
2. What is the population increase for the Plans area & what percentage is that of the current City population?
3. Why did the Downtown area get designated to absorb a drastic population increase, which will dramatically change the character of Santa Cruz?
4. What criteria was applied to justify such planning?
5. Would a Downtown 8 stories height limit address the potential of over 12 stories due to the Density Bonus additional height increase?
6. Were equal efforts applied to the public & developers concerns to explore win-win planning options/alternatives?
Reviewing Downtown Expansion Area Plan Amendment Revision - Report from Mayor Keeley and Councilmember Newsome (CN) I have these comments:
I welcome Mayor Keeley and City Council Member for offering their Plan Amendment Plan, which is response to City Council Members recommendation to lower dwelling units to 1,600. The Amendment Revision doesn't specify how many 12 stories would be permitted thus still allowing for the dramatic character change of Santa Cruz.
It's worth noting that many public members opposed the building density of the Downtown Expansion Area Plan, because of undesired Santa Cruz change.
Their Report statement '...residents also cost the City money through provision of police, fire, library, road maintenance, and various other services.' raises the concern that such a heavy population increase overburdens the Downtown various infrastructures & resources. It would be regretful if the heavy populated Downtown would require more of the City's resources at the expense of other neighborhoods.
The Report mentions 'Reduction of units in this plan area will likely mean that those units will need to be planned for through residential capacity increases elsewhere in the community.'. This implies that the City has the promising options to spread out the dwelling unit increase in a neighborhood friendly way.
In consideration that nobody seems to like the visible proof of the Downtown Expansion on the corner of Pacific Ave./Front St. it is important that the EIR evaluates a Superior Environmental Project alternative with the least impacts.
Thank you for your time considering my input/ feedback,
24.2.34 2
Sincerely,
Jane Mio
24.2.35 1
Rosemary Balsley
From: Jane Real <[email protected]>
Sent: Monday, January 09, 2023 4:55 PM
To: City Council
Subject: Community Feedback
Dear City Council Member,
I am writing to you tonight to urge you to oppose item #24 on your agenda. It is unconscionable to consider unlimited massive building in the downtown south of Laurel area. Prior to the behemoth being built on the corner of Laurel and Front streets most of Santa Cruz buildings were less than 5 stories tall. From various points one has vistas of the Santa Cruz skyline: Holy Cross steeple, the town clock, and and Sunshine villas copulas. The new monstrosity being built is a gigantic box masking many of these vistas. I cannot imagine more buildings going up in that area that are even more massive.
Aesthetics aside, this proposal displaces low income people already living in the area. It will create more congestion in an already extremely congested area where 1000 of tourist cars already fill the streets on a sunny weekend.
Surely we can come up with a less concentrated, less dense and more human scale housing solutions through out our area.
Please do not disregard the General Plan and do not vote for item #24.
Sincerely,
Jane Real
24.2.36 1
Rosemary Balsley
From: Ann Simonton <[email protected]>
Sent: Monday, January 09, 2023 4:56 PM
To: City Council
Subject: Expansion of Downtown
Dear Council members, It appears the City Council is in a very BIG hurry to push as much development in our downtown as possible. Why not take a breath and consider the implications of building in a flood zone, that is also very dangerous in an earthquake given the liquefied sand that holds the buildings? The earth is changing rapidly and maybe building in another part of town would make a lot more sense.
Maybe one with bedrock that has a bit of elevation to it? This expansion project is being pushed and paid for by the Seaside company’s greed.
Why not stand up to Seaside Company rather than capitulate? The expansion destroys neighborhoods in that area that will have to be relocated. Please give their voice as much credence as Seaside’s. Thank you, Ann Simonton
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