In a quiet and sparsely attended afternoon session on Sept. 25, Santa Cruz City Council made a motion to dramatically amend the text of Measure O — the affordable housing mandate for newly constructed housing units within the city of Santa Cruz.
“It was a rather undemocratic thing for the council to do,” said Students United with Renters member and campaign organizer for Measure M Julian Parayno-Stoll. “To begin with, it was an afternoon vote. That’s not a time that a lot of working people can make. […] The decision-making process the council chose, intended or not, was undemocratic in practice, and I would rather it go to the voters.”
Measure O, as written when it was first approved by voters in 1979, required all new multifamily housing developments to designate at least 15 percent of their units as affordable housing units, with rent capped at 30 percent of household income.
Among the effects of the amendments is a reduction in the affordable housing requirement for newly constructed multifamily units from 15 percent to 10 percent in areas outside of downtown. Also included is an increase to the maximum rent for affordable units from 30 percent of household income to 35 percent.
The amendment motion was made by councilmember Cynthia Chase following a lengthy proposal presentation by Santa Cruz director of planning and community development Lee Butler, Santa Cruz housing and community development manager Carol Berg and managing principal of the real estate consulting firm Keyser Marston & Associates Kathe Head. All three were involved in the planning commission that prepared the report upon which the proposal was based.
The council voted to approve the motion 5-2, with councilmembers Chris Krohn and Sandy Brown opposing. City staff proposed the now-adopted amendments to the City Council to encourage the development of rental housing in Santa Cruz.
“We have a problem with the amount of rental housing that has been developed. If we look at the 1994 to 2016 figures, […] we developed during that 22 year time period 106 non-subsidized multifamily housing units. Five units per year,” said Santa Cruz director of Planning and Community Development Lee Butler during the public hearing.
This scant level of construction, Butler said, is the primary reason for Santa Cruz’s lack of affordable housing.
The gist of the proposals by city staff and Keyser Marston is that Measure O in its original form is stifling development, and its requirements need to be relaxed in order for development of any units to take place. The 35 percent of household income threshold for maximum allowed rent was a compromise between the staff recommendation to maintain a cap of 30 percent and the consultant recommendation to increase the cap to 40 percent.
This line of reasoning was echoed by the council members who ultimately voted in favor of adopting the recommendations.
“I don’t like the idea of lowering our [affordable housing requirement],” said councilmember Richelle Noroyan, “but when the reality of the economics are put in front of us, it’s a fact I can’t ignore either. […] I would love to be able to put more on the shoulders of the developers to provide this, but the realities just don’t bear that out.”
Only three members of the public offered comments on the amendments, and all of them opposed the proposed changes. Councilmember Chris Krohn expressed concern before the vote about the delegating of policymaking to an unelected planning commission.
“You have unelected people here making these decisions for the community,” Krohn said. “It makes total sense to me why we’re getting this reaction we’re getting right now and why we have this partisan divide in our community.”
Earlier in the meeting, Krohn had inquired whether any renters were on the planning commission. Santa Cruz housing and community development manager Carol Berg said in response, “I think there are two.”
Advocates for affordable housing were disappointed but unsurprised by the outcome of the meeting.
“I think it’s another example of the ways in which the City Council really is in the pocket of big developers,” said Students United with Renters member and campaign for Measure M organizer Julian Parayno-Stoll. “[Developer’s] interests are profit rather than the interests of tenants and rents in Santa Cruz.”