Santa Cruz Local

A proposal for a six-story apartment building at Mission and Otis streets is headed to a community meeting on April 21. (Workbench)

Community meeting on 930 Mission St. proposal

• 6 p.m. Tuesday, April 21.
• Join on Zoom or call 669-444-9171 and enter 817 3446 4595.

SANTA CRUZ >> Two separate proposals for 60-unit apartment buildings on Mission Street in Santa Cruz were submitted to city planners in recent weeks. 

An eight-story building with 60 homes and ground floor shops is proposed at 1501, 1507 and 1511 Mission St. The project would demolish Donnelly Chocolates, Falafel Santa Cruz, and a single-family home and construct the apartment building across the three parcels. Project plans include 12 studios, 30 one-bedroom homes, six two-bedroom homes and 12 three-bedroom homes. 

A six-story building with 60 homes is proposed at 930 Mission St., currently a single-story building with medical offices. Project plans include 38 studios, 19 two-bedroom apartments and three three-bedroom apartments. A community meeting for the 930 Mission St. proposal is set for 6 p.m. Tuesday, April 21 on Zoom. 

Santa Cruz-based developer Workbench proposed the building at 930 Mission St. Workbench has numerous projects in the works across Santa Cruz County, including three projects embroiled in lawsuits.

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Renderings show a proposed eight-story apartment building at Mission and Trescony streets in Santa Cruz. (Anderson Architects Inc)

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A seven-story building with below-market-rate studio apartments for older adults is proposed in Downtown Santa Cruz. (McSorley Architecture)

SANTA CRUZ >> A proposal for a seven-story building in Downtown Santa Cruz has been submitted with the help of Ryan Coonerty, candidate for Santa Cruz Mayor. The project would replace the single-story Dell Williams jewelry store building at 1032 Pacific Ave. owned by Coonerty’s wife and mother-in-law.  

The proposed building next to the Palomar Inn would have 38 below-market-rate homes for older adults. It would also include shops on the bottom floor and common space for residents on the second floor, including a community kitchen, meeting room and fitness room. The project does not include any parking, as permitted by state laws.

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A proposed building next to the Palomar Inn would use modular construction, where parts of the building are built elsewhere and assembled onsite. (McSorley Architecture)

Streamlined approval process

The proposal uses AB 2011, a state law that allows approval by city staff, without public hearings, for commercial buildings redeveloped to include housing. However, it’s also seeking for the city to cede about 10 feet of a stretch of the alleyway behind the building — which does require a Santa Cruz City Council vote. 

An appraiser is now determining the monetary value of the strip of land, said Santa Cruz Housing Development Manager Jessie Bristow. After that process, the city council and developers would negotiate on an agreement to transfer the property in a closed session of a city council meeting, Bristow said. If an agreement is reached, it would be discussed and voted on in public, during an open session of a council meeting, he said.

If city council approves the expanded footprint, the project would be approved as soon as the developer, Arcata-based Danco Group, submits a complete application that complies with city rules. An application submitted earlier this year was deemed incomplete and has been returned for additional information, said Senior Planner Ryan Bane.

Coonerty family connection

Dell Williams — and the land to be redeveloped — is owned by Emily Coonerty, the wife of mayoral candidate Ryan Coonerty, and Emily Coonerty’s mother, Cindy Bernard. Ryan Coonerty helped facilitate the deal with Danco after being hired as a consultant to find a suitable location for the project. That contract ended May 2025, he said. 

Ryan Coonerty also consulted for developers on other projects in the city in 2024 and 2025, including the Cruz Hotel, 201 Front St. and an apartment complex on Delaware Avenue  leased to UC Santa Cruz for students and staff.

“I was trying to help projects that I agreed with get the community and city support necessary to get across the finish line,” he said.

As part of his contract with landowners and developers for the 201 Front St. project, he has also had conversations with leaders of the Santa Cruz Warriors about their future plans for a stadium, he said. The contract ended July 2024, and Coonerty said he remains  “involved in ongoing talks with the Warriors” without pay.

He said his most recent contract with a developer ended in August 2025, for an unannounced project from Owen Lawlor Land Use outside of city limits. Coonerty said his experience working with developers would not conflict with his potential decisions as mayor and that he would recuse himself from any decisions related to the Dell Williams building, or any other matters advised by the city attorney.

“I’m going to abide by the letter and spirit of the law,” he said.

The building would include 38 below-market-rate homes for older adults and one market-rate unit for a building manager. (McSorley Architecture)

Questions or comments? Email info@santacruzlocal.org. Santa Cruz Local is supported by members, major donors, sponsors and grants for the general support of our newsroom. Our news judgments are made independently and not on the basis of donor support. Learn more about Santa Cruz Local and how we are funded.

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The post Seven-story affordable housing proposed next to Palomar Inn appeared first on Santa Cruz Local.

Three apartment proposals from developer Workbench are embroiled in legal challenges. (Workbench)

SANTA CRUZ >> Among local developers, Santa Cruz-based Workbench has been arguably the most prolific at advancing multi-story apartment buildings — and among the most likely to have its projects end up in court. Three separate Workbench housing proposals in Santa Cruz County are currently ensnared in litigation, tying up more than 200 proposed apartments, including 19 below-market-rate homes. 

Workbench’s founders have said the projects are necessary to address the county’s severe housing crunch. Some residents have fiercely opposed the potential developments, arguing the proposed homes are mostly unaffordable and the scale of the projects would strain local resources and infrastructure like water, traffic and parking. One of the projects, near Dominican Hospital, has generated public health and safety concerns. 

While California laws meant to address the state’s housing crisis have largely stripped power from local authorities to deny or change proposals for housing, some local leaders have pushed back amid their constituents’ ire.

Here are the Workbench projects currently in court and how the outcomes of these lawsuits could affect future development in Santa Cruz County.

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In May 2024, the Santa Cruz City Council approved a five-story, 48-unit project at the site of the Food Bin and Herb Room at 1130 Mission St. But the city council rejected the inclusion of storage spaces that Workbench intended to convert into 11 accessory dwelling units, or ADUs, which would make the total units 59. State law allows developers to convert unused space into ADUs to squeeze more units into an existing building.

Workbench and the Food Bin’s co-owner, Douglas Wallace, sued the city over the denial of the ADUs, alleging the city violated state housing laws that promote density and prevent local jurisdictions from imposing changes that would require a redesign.

An apartment complex on the Food Bin site approved by the Santa Cruz City Council in May has been stalled by a lawsuit over 11 in-law units. (Workbench)

After Judge Rebecca Connolly ruled against Workbench and Wallace in August, they appealed the case. In an opening brief filed in February, Workbench’s lawyers alleged the city council “buckled to public pressure” from angry neighbors and that this case “demonstrates why housing in California remains the most expensive in the nation.”     

“The city is arguing that it simultaneously did not remove housing units from the project while also arguing from the other side of its mouth that it did not remove non-housing amenity spaces,” Ryan Patterson, a San Francisco-based attorney representing Workbench, said last week. “Either way it broke the law. We look forward to the court of appeal seeing through the city’s charade.”

City of Santa Cruz spokesperson Ashley Hussey said, “The city has no comment on this matter as it is pending litigation.” 

Workbench has said it will not start construction on the apartments, geared toward college students without cars, unless the ADUs are approved.

Litigation around the Food Bin project likely influenced another Workbench project: the Clocktower Center at 2020 N. Pacific Ave. In August, the Santa Cruz City Council approved the 178-unit project, including amenity spaces that can be converted to 46 additional ADUs, which would bring the total to 224 units.

Santa Cruz City Council approved the 178-unit Clocktower Center project, with some spaces labeled with uses such as a steam room, a chef’s kitchen and a music room. (Workbench)

In the Food Bin project, Workbench labeled the storage spaces as future ADUs. In the Clocktower Center project, the spaces were labeled with uses such as a steam room, a chef’s kitchen and a music room. Because cities cannot apply local building rules that effectively block the building as designed, city attorney Tony Condotti said they could not force a redesign. 

Condotti said at the time that Workbench “obviously learned its lesson from the Food Bin case.”

The use of conversion ADUs to maximize units in a new development is increasingly common, said William Fulton, editor of California Planning & Development Report and former mayor of Ventura and planning director of San Diego. “But I have not seen that litigated significantly,” Fulton said.

He said the state has adopted dozens, if not hundreds, of housing laws in the past decade or so in an attempt to boost development. In places like Santa Cruz, he said, “basically everyone under 40 is boxed out of the ownership market” because home prices are so high in part due to the paucity of new construction. Many of these state laws have yet to be fully tested in the courts, and case law will set precedents that influence how far cities and developers can push the boundaries of the law.

Builder’s Remedy brawl

Two more lawsuits involving Workbench projects were filed last month and center around the Builder’s Remedy, part of a state law which allows developers to largely bypass local zoning requirements if a county or city lacks a state-approved housing plan, called a Housing Element.

Confused about housing jargon?

Read Santa Cruz Local’s housing glossary to learn common words, phrases and laws.

For decades, Fulton said, hardly anyone used the Builder’s Remedy, which was adopted in 1990 and amended in 2024. But in recent years Builder’s Remedy projects have proliferated. 

Across California, “it is not uncommon for cities [and counties] to resist application of Builder’s Remedy, or be either confused or unprepared about how to respond to a Builder’s Remedy application,” Fulton said. 

The County of Santa Cruz, responsible for planning for new housing in areas outside the four cities, failed to finish and get certified its latest Housing Element by a December 2023 deadline. Until the state issued a letter certifying the county’s plan in April 2024, Builder’s Remedy rules were apparently in effect. 

That same month, Workbench filed a Builder’s Remedy pre-application for a six-story, 105-unit apartment complex at 3500 Paul Sweet Road and another Builder’s Remedy pre-application for a three-story, 28-unit apartment complex at 841 Capitola Road, which later grew to be a five-story, 57-unit proposal.

A house at 841 Capitola Road in Live Oak could be redeveloped into 57 apartments. (Jesse Kathan — Santa Cruz Local)

Now, some neighbors who oppose the 841 Capitola Road project have sued, alleging that Workbench invoked Builder’s Remedy too late and that regardless the county’s approval of the proposed development should be invalidated on constitutional grounds.

The suit cited documents showing that no “substantive review” of the county’s Housing Element was conducted after March 15, 2024. 

The Board of Supervisors appears to agree with the neighbors’ interpretation. In a recent letter, supervisors asked the state to “correct the certification record” and determine the county to be in compliance as of that date. 

“If we prevail, the project will be subject to the same development standards that apply to everyone; it will not be able to bypass them by exploiting a loophole,” Mark Wolfe, a San Francisco-based attorney for the group of neighbors, said in a statement. The lack of a formal certification letter by March 15, 2024, was a “result solely of internal bureaucratic delay,” he added.

Workbench proposed a five-story, 57-unit apartment complex at 841 Capitola Road. (Workbench)

Workbench has argued that informal communications don’t constitute formal approval, and that a determination otherwise would leave the Builder’s Remedy process muddled in uncertainty. Patterson, Workbench’s attorney, said the county “did the right thing in approving this project.” 

“Unfortunately, NIMBY opposition never stops,” he said. “We look forward to successfully defeating their lawsuit in short order.”

The Santa Cruz County Planning Commission approved the proposal at 841 Capitola Road on Oct. 22, 2025. Neighbors of the project appealed it to the Santa Cruz County Board of Supervisors. (Amaya Edwards — Santa Cruz Local/CatchLight Local)

Similar Builder’s Remedy lawsuits disputing Housing Element dates have also been filed elsewhere in the state. 

“The biggest unanswered legal question is whether or not the state housing department has to actually approve a Housing Element for it to be valid,” said Fulton, the housing expert. He added that he expected the state legislature or state Supreme Court to eventually weigh in.    

The outcome of the lawsuit could determine the fate of another Builder’s Remedy project in Santa Cruz County: The Haven, which was also proposed in April 2024.

The Haven is a proposal for 123 single-family homes and 34 townhouses across more than 25 acres of undeveloped land across Graham Hill Road from Henry Cowell Redwoods State Park Campground. The proposal has drawn skepticism and concern from residents and county leaders alike but has yet to come before the county planning commission for a formal hearing.

Workbench sues county over delayed approval

Unlike the Capitola Road project, county officials have thus far balked at approving Workbench’s Paul Sweet Road project, which has been vigorously opposed by neighboring Dominican Hospital and Dominican Oaks senior housing residents. 

Last month, amid unresolved fire safety and sewer issues, Workbench sued prior to going before the county planning commission for a second time. The suit alleged that the commission and the county unlawfully failed to make a timely decision and that the project was therefore automatically approved “by operation of law.”

At 3500 Paul Sweet Road near Dominican Hospital, 105 apartments are proposed. (Workbench)

“This is a straightforward case of the county failing to make a decision by its deadline,” Patterson said. “The consequence is clear.”

The county thus finds itself in the position of being sued for one Builder’s Remedy project it approved on Capitola Road and another it hasn’t on Paul Sweet Road.

“It’s disappointing that taxpayer resources will now be utilized in litigation over projects the county did not bring forward, involving a law the county did not write,” Santa Cruz County spokesperson Jason Hoppin wrote in an email. “We look forward to a speedy resolution.”

In the Paul Sweet Road case, Workbench and the county will present their arguments at a hearing set for June 12.

Clarification: This story has been updated to reflect that the project at 841 Capitola Road was first proposed as a 28-unit, three-story apartment complex.

Questions or comments? Email info@santacruzlocal.org. Santa Cruz Local is supported by members, major donors, sponsors and grants for the general support of our newsroom. Our news judgments are made independently and not on the basis of donor support. Learn more about Santa Cruz Local and how we are funded.

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The post As lawsuits ensnare three housing proposals, what could it mean for the future of development in Santa Cruz County? appeared first on Santa Cruz Local.

Monterey County received $20 million in state aid to help Pajaro recover from flooding in 2023. County supervisors split the funds between infrastructure projects and direct aid to businesses and residents. (Fidel M. Soto — Noticias Watsonville)

PAJARO >> More than four months after Monterey County hit the deadline to distribute $20 million in state aid for Pajaro after devastating flooding in March 2023, county officials have again delayed disclosing details on how the last of the money for residents and businesses was spent. 

Nicholas Pasculli, a spokesperson for the county, said in a January email that the final report would be available in February. In a Feb. 24 email he wrote that the report was “pending scheduling.” In an email on April 13, he said the “report is not finalized yet.”

Also on April 13, county spokesperson Maia Carroll wrote in an email, “The $10 million [for direct aid] was fully allocated.” Noticias Watsonville has asked for more information on how it was distributed but has not been provided further details. 

The most recent update provided by the county showed that as of September, $600,000 for residents had not yet been distributed. County officials had previously said that if they are unable to distribute all the funds for direct aid, any left over money would go to projects benefiting Pajaro.

“Not everything was perfect, but we fulfilled what was entrusted to us,” Supervisor Glenn Church, whose district includes Pajaro, told us last month.

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The $20 million was allocated to the county in July 2023 as part of the California legislature’s budget bill. It was up to Monterey County supervisors how to distribute the money, and Pajaro residents pushed back against a proposal to use $14 million for infrastructure improvements and $6 million for direct aid to residents and businesses. 

After residents’ advocacy, supervisors voted to instead split the money in half: $10 million for projects and $10 million in direct aid. The county had until Dec. 31, 2025 to allocate every dollar or else return the balance to state coffers.

The process to distribute the direct aid was, for many residents, painfully slow and arduous. It took the county and its nonprofit partners tasked with distributing the money, Community Bridges and Catholic Charities, more than a year to hand out roughly $1.4 million and by August 2025 more than $1.7 million still remained unallocated. 

For residents, one of the barriers to qualifying for money was a lack of photos of the damaged property. For business owners, it was often a lack of receipts. 

Daycare business owner Liz Ramírez said in August that despite an estimated $50,000 in damage to her business property, she received $8,000.

“I thought they were going to give a little more,” Ramírez said in Spanish. “I feel they gave me the money to say, ‘Here is what you get, be happy with it.’”

The Pajaro library is being renovated with money from the state. (Fidel M. Soto — Noticias Watsonville)

The most recent report from the county detailed distribution as of September 2025, including approximately:

• $4.7 million distributed to residents.
• $490,000 in administrative costs to distribute funds to residents.
• $3.8 million distributed to businesses. 
• $290,000 in administrative costs to distribute funds to businesses.

Additionally, millions for local projects had been allocated but not yet spent, according to the September report. Money that had been expended for local projects included: 

• $2 million in small local grants.
• $1.5 million for street improvements.
• $2 million to renovate the library.
• $336,000 for the North Monterey County Fire Protection District. 
• $122,000 for the Department of Emergency Management.

Héctor Llamas, owner of Pájaro Food Center, said his business suffered a lot of damages and losses from the floods. 

“The county probably did everything it could. We wanted to have more to make up for everything that was lost,” Llamas said in Spanish. “It could have been done better, but perfection doesn’t exist.”

This week, a staffer for supervisor Church said the final report would be published next month.

Questions or comments? Email info@santacruzlocal.org. Santa Cruz Local is supported by members, major donors, sponsors and grants for the general support of our newsroom. Our news judgments are made independently and not on the basis of donor support. Learn more about Santa Cruz Local and how we are funded.

Learn about membership Santa Cruz Local’s news is free. We believe that high-quality local news is crucial to democracy. We depend on locals like you to make a meaningful contribution so everyone can access our news. Learn about membership

The post Monterey County officials delay report on Pajaro flood money, again appeared first on Santa Cruz Local.

The Watsonville City Council meets in June 2024. (Marcello Hutchinson-Trujillo — Santa Cruz Local file)

Editor’s note: This story first appeared as an episode of Noticias Watsonville. Listen to the Spanish podcast here. 

WATSONVILLE >> The Watsonville City Council proposed rate increases for water, trash and sewer services at its March 24 meeting. The average household in Watsonville would see their bill go up about $14 starting July 1. The rates would increase each year through 2031. 

The proposed rate hikes include:

• 5% annually for water.
• 2% annually for trash.
• 16% in 2027, 12% in 2028 and 6% each year from 2029 to 2031 for sewer.

The proposed increase to sewer fees are needed to pay for replacements to aging facilities at the wastewater treatment plant, which could cost $57 million. The facility was built in 1961 and the last major upgrade was in 1986, said Danielle Green, assistant director of public works. 

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The equipment that needs to be replaced is “the area where all of the sewage in the city comes to the plant, so it’s a very important component of the plant,” Green said. “The structure’s in really bad shape. We’ve had to close off some areas of it because it’s not safe for our staff to access.”

Increases to water rates are needed in part to pay for water filtration upgrades to remove chromium six from groundwater wells that feed the city’s water supply. The chemical can cause health harms but is not at a dangerous level, Green said. New state regulations require the city to bring chromium six levels lower.

Increases to trash fees are due in part to new state regulations that require biodegradable materials to be separated from trash, to reduce greenhouse gas emissions. 

The proposal is set to be considered by the Watsonville City Council on May 26. Ratepayers can submit a protest in writing, stating evidence why the proposal is not in line with Proposition 218. That law, among other requirements, dictates that utilities fees must only cover the costs of delivering services. In other words, the additional revenue from the fee increases can only be used to continue providing utilities services. 

A webinar to answer questions about the proposal is planned for 5:30 p.m. Wednesday, April 29.

Questions or comments? Email info@santacruzlocal.org. Santa Cruz Local is supported by members, major donors, sponsors and grants for the general support of our newsroom. Our news judgments are made independently and not on the basis of donor support. Learn more about Santa Cruz Local and how we are funded.

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