Scotts Valley City Council
City Manager Mali LaGoe told Council April 3 Scotts Valley's Housing Element had been certified by HCD. (Drew Penner / Press Banner)

During a report at the April 3 Council meeting, Scotts Valley City Manager Mali LaGoe announced the California Department of Housing and Community Development had certified its Housing Element—on its first try.

LaGoe said the City had received the good news about its residential development plan a day earlier.

“It’s an important milestone that we have achieved,” she said, noting the community is the second in the county to get the thumbs-up from HCD. “Huge shout-out to staff and our consultants.”

It’s a major coup for the Silicon Valley and Santa Cruz bedroom town, as it beat both of its northern neighbors to the punch, despite the fact that those communities were supposed to have their homes plans ready nearly a year before Scotts Valley. Monte Sereno is on its fourth Housing Element draft; Los Gatos has had five submittals rejected by HCD.

On Dec. 19, Scotts Valley received a letter from the State with comments on its Draft Housing Element.

In the ensuing hours, staff worked to quickly address these concerns, and by the following evening, City Attorney Kirsten Powell said she believed the document had been brought into substantial compliance.

Council voted unanimously to adopt the Draft Housing Element on Dec. 20 “with the incorporation of supplemental information to address HCD’s December 19, 2023 Comment Letter.” The updated version was available for public review from Jan. 25 to Feb. 1.

Because Council authorized Community Development Director Taylor Bateman to make changes as necessary in consultation with HCD, staff sent the draft to the State, including additional analysis of the various proposed programs in the document.

“At that point, the City was required to post the approved document for public comment for seven days prior to submitting the final document to HCD for certification,” LaGoe told the Press Banner. “The document was submitted to HCD on March 28.”

The State housing agency certified the Housing Element on April 2.

Scotts Valley contracted with Kimley-Horn, for $287,000, for the Housing Element. Compare that to Los Gatos, which paid Monterey-based EMC Planning Group nearly $313,000 then secured Glendale-based Veronica Tam & Associates for a $51,100 contract—and still doesn’t have a certified Housing Element.

From 2015-2023, Scotts Valley was required to plan for 140 homes, including 58 “Above Moderate” units, 26 “Moderate” units, 22 “Low” units and 34 “Very Low” units. This time, Scotts Valley is expected to encourage the construction of 1,220 homes—417 “Above Moderate,” 154 “Moderate” units, 257 “Low” units and 392 “Very Low” units by 2031.

Scotts Valley has been adding homes much faster than other Santa Cruz County communities. While Capitola increased housing stock by 3.5% from 2015-2020, and Santa Cruz grew at a 3.2% rate, Scotts Valley went from 4,390 to 5,252 units—a 19.6% jump, according to the American Community Survey. And the new Housing Element has set it on a path to continue this trajectory.

The population is also much wealthier. At $103,783, its median household income is 15.3% higher than the county overall. In fact, about 23% here bring in at least $200,000 annually.

The housing plan sailed through on this City’s first swing largely because, unlike many affluent communities—Huntington Beach being the one of the worst offenders—Scotts Valley opted not to fight the State.

While the mayor of Los Gatos, for example, has opposed many of the efforts to increase density in her town, and Monte Sereno is attempting to rely on ADUs to avoid allowing more multi-family dwellings, Scotts Valley built-in a healthy buffer beyond the bare minimums.

Overall, it’s planning for 2,166 new homes—78% above the 1,220 “Regional Housing Needs Assessment” mandate. This includes 1,102 “Above Moderate,” 168 “Moderate” and 896 “Low and Very Low” Income units.

The lion’s share of units (657 total, of which 427 are for “Low and Very Low” Income residents), however, comes from the Town Center Specific Plan, which has stalled-out before.

Ryan Meckel, lead with Santa Cruz YIMBY (Yes In My Back Yard), called the certification a “significant” milestone.

“Santa Cruz YIMBY has provided feedback to the city and the state throughout this process and we will continue to do so,” he told the Press Banner. “There are still significant barriers to housing production that were not adequately addressed in the adopted element. Given that only 20 affordable units were built in the last eight years, we’ll be closely tracking the city’s commitments and pushing for more progress to make it possible for the 6th cycle goals to be met.”

Councilmember Jack Dilles, who was mayor during the planning last year, lauded staff for their success on the file.

“That’s a big deal,” he said at Council. “So, thank you.”

Mayor Randy Johnson said, with the nebulous housing rules coming out of Sacramento, it’s a relief to have a certified Housing Element in place.

“It gives us a little more—I think ‘protection’ is a fair word,” he said. “I know it was a lot of work.”

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Drew Penner is an award-winning Canadian journalist whose reporting has appeared in the Globe and Mail, Good Times Santa Cruz, Los Angeles Times, Scotts Valley Press Banner, San Diego Union-Tribune, KCRW and the Vancouver Sun. Please send your Los Gatos and Santa Cruz County news tips to [email protected].


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