A missed opportunity on 831 Water St.
As supporters of affordable housing and a vibrant business community, we believe the Santa Cruz City Council and the Sentinel Editorial Board (Editorial, Oct. 19) missed an opportunity to promote both in their opposition to the mixed-use housing development at 831 Water Street.
A severe housing shortage and affordability crisis, and local governments not accommodating their fair share of housing are only a few reasons why the state implemented Senate Bill 35 in addition to a suite of other bills focused on cutting red tape and holding cities accountable. The state also just established a Housing Accountability Enforcement Unit and passed AB 215 to strengthen enforcement of housing violations.
As Gov. Newsom said, “It’s supply-demand and balance; we’re not building up housing at all income levels in the state of California.” This shortcoming is even more severe in Santa Cruz County where the median price of a home is more than $1 million and the median income of a working family is less than $70,000 per year. Beyond our state, Santa Cruz has topped several lists of least affordable cities in the country and worldwide. What does this mean for us locally? From a business perspective, Santa Cruz businesses suffer from high employee turnover due to lack of nearby housing and struggle to attract and retain our most essential workers: teachers, police, firefighters, medical professionals, service workers and countless others who are ever more valuable during our COVID-19 recovery.
From an equity perspective, housing shortages further ostracize our most vulnerable neighbors, veterans, people with disabilities, at-risk youth and hundreds of low and verylow-income residents who need homes the most. Denying 831 Water Street not only misses an enormous opportunity to provide homes for 145 of these households in Santa Cruz, but sets a dangerous precedent for future affordable housing development.
Much of 831 Water Street’s opposition focused on how an SB 35 project should be processed. This project was mishandled, but not in the way that opponents contend. With the exception of Vice Mayor Sonja Brunner, the Santa Cruz City Council on a 6-1 vote to deny the project against staff’s recommendation, introducing subjectivity into a ministerial process in violation of state law. Furthermore, there was no invitation for the developer to address the Council’s concerns outlined in the motion. In spite of this the developer did address these items within the permitted 60 days of the project submission, which should have been considered by staff as part of the ministerial decision.
The contention that the project is “segregated” is not only logically flawed, but disregards the complexities of mixed-income housing financing and spreads a dangerous narrative. If this logic were universally applied, then every affordable housing project would be considered segregated. Project financing requires the separation of the affordable units from the market rate units in order to secure a deed restriction for the building with affordable units. HCD SB 35 Guidelines also allow for clustering affordable units when required by state funding which is part of existing law. Despite the complications it imposes on its financing plan, the developer followed up with city staff on Oct. 14 agreeing to disperse the affordable and workforce units throughout the project.
The City Council and Sentinel Editorial Board’s subjective commentary and ultimate decision overshadows what’s most important about the project: 831 Water Street provides an unprecedented opportunity to build deed restricted affordable and workforce housing - exactly what the state and many of our local elected officials repeatedly call for. It’s time to put politics aside and do not only what is lawful, but what is right. We strongly encourage the Council and project opponents to invest in better understanding the complexities of affordable housing policies and financing structures, thus ensuring approval processes are efficient, lawful and fair for all stakeholders, particularly low income and vulnerable renters voices who aren’t often heard.