Quick Take
At 831 Water Street, a revamped proposal for 140 income-restricted units has reignited a debate over local control that has become all too familiar in the city of Santa Cruz.
On Wednesday, the city’s planning department will host the developer and public for a virtual community meeting, the first in more than three years for a project that acted as the foray of new state housing policies into Santa Cruz.
The beginnings of the spin cycle Santa Cruz has endured over recent years of new housing policies and the deteriorating strength of local control can be traced back to the fall of 2020 and the northwest corner of Water Street and Branciforte Avenue.
On the lot at 831 Water St., where DJ’s Mini Mart sat with Metro PCS, a massage parlor, and a laundromat and self car wash service each named “Hilltop,” Walnut Creek-based Novin Development envisioned 145 housing units spread across two buildings rising to four and five stories, with some ground-floor commercial space to boot.
The vision was at a scale unfamiliar to the neighborhood, and the process unfamiliar to residents and the city council. Iman Novin, principal with Novin Development, submitted the application on Oct. 12, 2020, under Senate Bill 35, a still-new state law that allowed certain projects like 831 Water to skip a city’s approval process. At the time, the city of Santa Cruz was behind on its state mandate to build 180 very low-income housing units. Because of this, the city council and planning commission were allowed to do little with Novin’s proposal but confirm that it met local design standards and rubber-stamp it.
The city council initially turned down the plan in October 2021. However, the threat of a lawsuit leveraging new state laws led the city council to approve the project two months later in a tense 4-3 vote that councilmembers still describe as “challenging.” After such a loud civics battle, the project went dormant.
Now after a few years, that project is coming back.
Earlier this year, around the time that DJ’s Mini Mart, Metro PCS and the massage parlor shuttered and boarded up their windows, Novin Development submitted a revamped project proposal. Two buildings are now one, 145 units mixed between market rate and low-income are now 140 units, all of which will be income-restricted, and 136 parking spaces will now be 43.
Novin, the developer’s principal, told Lookout he and his team took criticisms about the two-building layout to heart, and also found they could do a 100% income-restricted building. However, he emphasized that Wednesday’s community meeting is simply a formality and that city politics and sentiment can do little to change or slow the project at this point. Novin said the project’s financing is already squared away and he expects to begin construction in the second quarter of 2025.
However, a local neighborhood group, 831 Responsible Development, is hoping to alter the project members say is too tall and dense, with too few parking spots. The group has claimed that the alterations to the project are so significant that they require a new application.
“While we absolutely recognize that new state laws can tie the city’s hands with respect to reviewing some aspects of housing proposals, that recognition doesn’t mean the city shouldn’t do everything possible to prevent projects from creating health and safety issues for its citizens,” the group’s website reads.
A new application could result in a costlier path for Novin Development, and change the smooth texture of the approval process, since the city of Santa Cruz in 2024 is no longer considered to be slacking on its mandate to build very low-income housing units. However, a 100% affordable housing project remains difficult to stop in California’s new pro-housing legal landscape.
The city will host the virtual meeting on Wednesday at 6 p.m. You can log in via the Zoom link here.
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