Quick Take
As Santa Cruz weighs a major downtown expansion and a new housing measure, Mayor Fred Keeley faces a defining week. Years of planning come to a head as the city debates growth, change and what kind of future it wants to build.
A Lookout series on the business and politics of development in downtown Santa Cruz
On the morning before what he views as the most pivotal local government vote of his nearly four-decade political career, Mayor Fred Keeley took up his regular booth inside the Santa Cruz Diner and ordered his usual breakfast of sides: side of ham, side of hash browns and a side of toast.
“I do not have what you’d call a curious palate,” Keeley told me, leaning over his first of three successive cups of coffee.
Between bites of ham, Keeley, sporting a crisp, lavender button-down shirt beneath his well-worn, black Golden State Warriors suit jacket with a fraying left lapel, considered the week ahead: On Tuesday, the city council will decide whether to reshape downtown Santa Cruz, expanding it south to create a taller, denser neighborhood and adding a new Santa Cruz Warriors basketball arena, in addition to a new development incentive, known as the downtown density bonus, that offers the best chance at keeping skyscrapers out of the city’s center. Then, on Thursday, the mayor and local housing advocates plan to hand in their petition to place an affordable housing measure on the November ballot.
Together, the efforts, both years in the making, led Keeley’s mayoral platform when he ran for the seat in 2022. He told Lookout then that he vowed to negotiate the downtown expansion into a vision of more human scale than the earlier — and, for many, anxiety-inducing — visions of 15- and 17-story towers, and to place an affordable housing measure on the ballot.
This week could be the crucible where Keeley secures a mayoral legacy after a long political career. However, the breadth of that legacy will depend on what happens after. Even with Tuesday’s expected city council approval of the downtown expansion plan, and Thursday’s submission of petition signatures supporting Keeley’s housing measure, both proposals will continue to face long-simmering animosity that will pose challenges beyond this week’s milestones.
“This is certainly one of the two or three biggest political weeks of my life,” said Keeley, who turned 75 on Friday.
The downtown expansion continues to face an impassioned opposition from longtime Santa Cruzans, who despair over their city’s lost small-town charm in proportion to the height of proposed new buildings and number of new housing units. That faction of the community might have lost influence on the growth-friendly city council of today, and failed to pass a height restriction ballot measure last spring, but they have remained organized and appear ready to continue the fight.
Keeley’s housing measure also faces a steep battle against the real estate industry, which will submit signatures supporting its own affordable housing ballot measure this week. The leaders of the Santa Cruz County Association of Realtors have been upfront that the intent of their measure — which proposes to raise less money for affordable housing but at a lower cost to property owners and sellers — is to defeat Keeley’s. Simply qualifying a measure for the ballot hardly carries the same legacy-shaping force as passing it.
Through the downtown plan expansion, the city wants to connect downtown to the beach through a walkable and bike-friendly entertainment district, with a new Santa Cruz Warriors arena, a public plaza and buildings up to 12 stories tall, with a total of 1,600 new housing units. The proposal marks the most significant, and perhaps most fraught, land-use change in the city of Santa Cruz since the city picked a direction for downtown following the 1989 Loma Prieta earthquake.
Keeley and I spoke for nearly 90 minutes, about the future of Santa Cruz, his legacy and what the next 18 months of his first and last mayorship will look like. For the sake of brevity, we are including just the pieces about the downtown expansion plan, which the Santa Cruz City Council is slated take up at 7 p.m. Tuesday.
This interview has been edited for brevity and clarity.
Lookout: You had a long political career before becoming mayor, starting at the Santa Cruz County Board of Supervisors in 1988, up to Sacramento in the state Legislature, and as the county treasurer. Do you remember another similar stretch where the notion of your legacy was so encapsulated into the events of a single week?
Fred Keeley: No. The closest for me was when the Speaker of the Assembly had me lead the effort to investigate the insurance commissioner, and it ended up with him and his attorney talking to me at 3 o’clock in the morning in Capitol Park to negotiate his resignation. This is an important week for the city, and I think the downtown expansion is the most important vote taken in the city since the final plan for recovery from the earthquake.
Lookout: How do you equate the city choosing its direction for earthquake and disaster recovery to what is ultimately a land-use change in downtown?
Keeley: It is change imposed on our city by others, and us deciding how we deal with it. God decided to have an earthquake. We didn’t ask for an earthquake. We didn’t ask for this. From 1978 to 2017, the City of Santa Cruz was in growth-management mode, with the compliance and encouragement and support of the electorate and the state then changed that. So yes, the velocity of change, the impact of change, years in the making and decades of implications afterwards, I can’t think of another single vote that will have a 60-, 70-year impact on our city. I can’t think of a more important vote I’ve taken in local government.
Lookout: So this is about how Santa Cruz deals with growth?
Keeley: This is about how the city is dealing with a massively different public policy environment, and our instant case happens to be this plan. If the Warriors weren’t in town, we’d be having a similar but different conversation.
Lookout: How so?
Keeley: We’d still be talking about, well, where else is there going to be concentrated density? Nobody wants it in their damn neighborhood.
Lookout: So you think the Warriors have made this an easier conversation about where to grow, then? How?
Keeley: Mhm, to me. First of all, the city likes the Warriors, I mean, they’re the great story of the G League. All cities don’t fall in love with their G League team. This downtown plan expansion is not being designed as a primarily retail district. This is being designed as an entertainment district, because that’s what lights up cities now, especially medium-sized cities like ours. I’ve told people, I’m not interested in making Santa Cruz great again — Santa Cruz is already great. But I am interested in making Santa Cruz relevant again, in the world, and to itself.
Lookout: You think Santa Cruz has become irrelevant?
Keeley: Well, what’s irrelevant to the community in terms of downtown? Santa Cruz is not going to be the retail hub of the Central Coast of California. It’s going to be an arts, entertainment, some retail, and restaurants, it’s going to be a place that’s good all day and all night. It’s going to be a place that’s very, very different.
Lookout: That’s what you see for downtown?
Keeley: Absolutely, especially with 1,600 new homes downtown — I’m getting better about not saying “units.” People live in homes, not units.
Lookout: So do you think the Warriors have just made this conversation easier or are they driving the conversation?
Keeley: I don’t think they’re driving the conversation, but they’re a very important part of it. For many people, even if they’re not Warriors fans, they get that we’re going from, you know, the Civic Center operating X number of days and nights a year, and the Kaiser Permanente Arena active X number of days and nights a year, to a new arena that probably going to be used 200-plus days a year, because it’s a different, newer, better, exciting.
I think that part of being a progressive community is that there is almost a humility that we shouldn’t have nice things, because it’s a little show-offy, it’s a little materialistic, it’s a little whatever to have nice things in the community. I think this is a nice thing that we really want.
Lookout: Throughout this process, you’ve been very upfront that you wanted guarantees that the downtown plan expansion would cap the number of new housing units at 1,600 and the height of new buildings at 12 stories. Now, you can encourage it, emphasize it, incentivize it, but with state density bonus laws, that will be impossible to guarantee. How are you thinking about that?
Keeley: The state law is the state law and there is not a choice about compliance. But the Warriors, and the developers and the property owners, all had an interesting response to that. This, to them, is all one deal — the housing and the arena. They said not only do they not want [to build higher than eight stories], but that they cannot afford more than eight stories because then they have to shift from wood framing to concrete and steel. The debate over height and the number of homes and affordability is over. Now it’s about how we get there.
Lookout: But there will be no way to stop a developer who wants to use the state’s doubling density bonus and go to 16 stories from doing that, right?
Keeley: If they want to, no. But we’ve given them a reason to not want to do that (through the city’s Downtown Density Bonus program). And, on top of that, it is the developers who say they don’t want to do that, and those developers we’re talking about are not from out of town. We’re talking about the Santa Cruz Warriors, and, basically, the Seaside Company (owner of the Santa Cruz Beach Boardwalk). It doesn’t get more local than that.
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