The Housing for People Citizen Initiative, ir Measure M, aims to put building height and floor area ratio changes in the city to a citizen vote. The initiative is a response to the city’s proposed downtown expansion plan, which would allow the construction of buildings about twice as high as the new development on Pacific Avenue and Laurel Street. . (Aric Sleeper/Santa Cruz Sentinel)
SANTA CRUZ — From the city’s latest economic development strategy to the final decision on the Walnut Avenue tree appeal and the impact report concerning Measure M, or the Housing for People initiative, the Santa Cruz City Council has another packed agenda in store Tuesday.
The meeting begins with a closed session featuring real estate negotiations that include items concerning the Santa Cruz Civic Auditorium and Atlantis Fantasy World. The open session begins with oral communications at 12:30 p.m. and ends with the consideration of the Measure M fiscal impact report, which was completed by consultant Keyser Marston Associates.
Although the agenda report from October associated with the motion calling for the creation of an impact report stated that the cost to compile the document was expected to be under $20,000, Tuesday’s agenda report stated that the actual cost was more than double. According to the staff report, “The cost of reviewing the measure and preparing this impact report was $42,000 in consultant fees, plus many hours of staff time that are not included in the $42,000 in direct costs.”
Measure M, or The Housing for People initiative, analyzed in the impact report, was placed on the March ballot in late November after a group of citizen organizers gathered nearly 7,000 signatures within a tight timeframe.
If the citizen-led initiative were to pass in the upcoming March election, Measure M would do two things: raise the city’s affordable housing inclusionary rate from 20% to 25% for developments with 30 or more housing units — a recommendation made by the city’s planning commission that was ultimately voted down by the council — and also prevent the Santa Cruz City Council from amending the city’s general plan or zoning ordinances in a way that increase allowable height limits or floor area ratios for new developments greater than the limits that were already in place for the city, as of last June, without a citizen vote approving the changes to the general plan.
As the measure is composed of two parts, so too is the impact report.
In its introduction, the 169-page Keyser Marston impact report about the initiative states that the report evaluated five primary issues in regard to the general plan and zoning ordinance amendments.
The impacts of raising the inclusionary rate an additional 5% were analyzed using “financial testing to evaluate the feasibility of increasing the percentage of affordable housing units that are required to be developed in new residential developments in Santa Cruz.”
Those issues evaluated regarding the general plan and zoning include: actions made by the city that would trigger the Measure M requirements; issues related to applying density bonus laws, the potential for increased risk borne by developers considering projects that would be subject to a vote of the people; the impact on achieving compliance with existing and future Regional Housing Needs Allocation targets and the potential fiscal impact to the city of Santa Cruz.
The subsequent executive summary points out that increases in height and floor area ratio associated with state density bonus laws would not actually trigger a citizen vote through Measure M as those bonuses do not change the city’s existing zoning or general plan in any way.
The latest housing element is also referenced and the report states that the passage of Measure M could potentially de-certify the document, which was recently certified by the state without any zoning changes proposed, and with the city’s current zoning and general plan parameters in mind.
The proposed downtown expansion plan, which served as an inspiration for the citizen-led measure is mentioned in the report’s executive summary. Although the expansion plan is not included in the latest, certified housing element update as the city is able to hit its state-mandated housing targets without changing the existing zoning in the “South of Laurel” neighborhood.
Also pointed out in the summary is the potential cost to the city if the measure were to pass. “Based on estimates provided by the Santa Cruz County Elections department, the current cost of an election falls within the range of $115,000 to $185,000,” the report shows.
The report includes numerous appendices with financial analysis of various building scenarios and associated affordable housing inclusionary rates to ascertain the impact of increasing it to 25%.
The report’s conclusion is that increasing the number of affordable units required in a building development by 5% could result in housing developments that would be less viable to investors, but would not affect projects with 100% affordable housing.
According to the report, “By definition, 100% affordable housing projects are not impacted by changes in the Inclusionary Housing requirements. These developments achieve financial feasibility through using a range of local, state and federal grants and assistance sources.”
To read the report, visit cityofsantacruz.com.
If you go
What: Santa Cruz City Council meeting.
When: 12:30 p.m., Tuesday.
Where: Santa Cruz City Hall, 809 Center St., Santa Cruz.
