Quick Take
In his State of the City address Thursday, Mayor Fred Keeley looked back on the city’s progress with building housing and cutting down homelessness, and discussed how city council districts have affected city government.
Santa Cruz Mayor Fred Keeley spoke about the city’s progress in the construction of housing and reducing homelessness in the past years, while acknowledging that the city still isn’t where it wants and needs to be. He also discussed the effect that shifting to a districted city council has had on city governance in his final State of the City address during the Santa Cruz Area Chamber of Commerce’s annual member breakfast at the Dream Inn on Thursday morning.
Keeley’s mayorship, which he jokingly referred to as the “Keeley reign of terror” has occurred during a period of major change for the city, as it breaks ground on numerous large housing developments and plans for thousands of new residents. The most pressing issues, though, have not changed. Housing affordability and homelessness remain residents’ chief concerns, but Keeley observed that people rarely agree on the two issues beyond that. He said some people want more housing, some don’t, and some want housing but not near them.
“On homelessness, it’s pretty similar. There is ‘We do too much and we draw people here.’ Or ‘We don’t do enough and we’re being cruel to people,’” he told the approximately 150 attendees.
Despite those widespread community disagreements, Keeley said Santa Cruz has “gone from being the poster child of growth management to the poster child for how you can grow responsibly,” in the face of forced growth at the state level. He pointed to the passage of Measure C, the Workforce Housing Affordability Act of 2025, an annual parcel tax and a graduated real estate transfer tax on home sales above $1.8 million that raises money for affordable housing, as Keeley promised during his 2022 campaign.
“What we have said as a community, is we finally found the right funding measure for housing affordability that the voters can support that will then lead to more and deeper affordability in the housing that is being built,” he said.
On homelessness, Keeley said the city has seen close to a 50% decrease in street homelessness in less than four years. However, this progress has been uneven, as the annual point-in-time counts showed the city’s rate falling in 2023 and 2024, but rising in 2022 and 2025. He brought up Measure C again, and said it’s an investment in preventing homelessness. He added that he believes the city is acting responsibly and compassionately, especially with the broader national context.
“The Supreme Court’s given us authority to be able to simply arrest people for being homeless. Well, there’s one hell of a solution,” he said. “You arrest somebody and what just got better? Nothing.”
Keeley counseled patience with the changes to the city and the downtown area, and said he believes downtown Santa Cruz will grow into its new identity in the next few years.
“You are going to see an enlivened, dynamic downtown that I believe will help us meet the challenges of the state,” he said. “Our future downtown is bright, and our future economically is bright. It is not without challenges, but it is, in fact, bright.”
Keeley reflected on the shift to a districted city council in 2023. With an at-large council, he said that “everybody’s responsible and nobody’s responsible for individual challenges throughout the community,” while district representatives are obliged to take responsibility for their own decisions. Keeley told Lookout after the event that cooperation between the city and county improved with the new format, too, especially when he was serving on other boards and committees, such as the Santa Cruz County Regional Transportation Commission.
“A one-year mayor dealing with a four-year supervisor is a mismatch. A four-year mayor with a four-year supervisor has continuity,” he said. “In effect, you hold each other accountable.”
Keeley said the city has built trust with the community on the issues of housing and homelessness. While he believes there’s clear momentum on the progress of these two issues, future mayors will have their own belief systems, which could lead to different priorities at the city level.
“I’ve tried to create momentum the same way my predecessors created momentum,” he said. “My successors will decide what to do with that.”
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