Lookout Santa Cruz: Editorial | Yes on Santa Cruz’s Measure C – with a caveat

The ballot facing Santa Cruz residents on Nov. 4 feels unusually mean-spirited. 

City residents are being asked to choose between two competing bills on affordable housing, one of which (Measure B) came to life intentionally to kill the other. 

Statewide, we, too, face a bill that is an angry response to another. Proposition 50 asks us to vote on a temporary statewide redistricting – to counteract attempts by Texas to “rig” elections via gerrymandering. We are told we must “fight fire with fire.” 

It’s ugly and exhausting, and easy for voters to dismiss the entire ballot because of the rancor. 

That would be a mistake. 

Locally, we live in the least affordable rental market in the nation. It’s a painful title for those of us who try to live our values and incongruous with the quiet beach town vibe we enjoy. Washington is ablaze with disruption, and we can, for the next few years, no longer rely on federal and state funding to help us. That makes looking for answers locally urgent.

Measures C and B both ask city of Santa Cruz taxpayers to provide more money (a parcel tax and a real estate transfer tax) to help solve problems that feel unsolvable – homelessness and affordability. That’s not an easy sell. Taxes never are. And they feel especially grim when the city keeps assuring us it’s making progress we don’t readily see. 

The biggest question on this ballot: Can we make our local money more impactful so we keep making progress on affordable housing and homelessness prevention? The secondary question: Do we approve of how the city is currently spending money on affordable housing and homelessness? 

If so, we have to support Measure C. 

The proponents – who include Santa Cruz Mayor Fred Keeley, who ran his 2022 campaign on a promise of bold housing solutions, and the nonprofit Housing Santa Cruz County – say the measure, a combined $96 parcel tax and real estate transfer tax on homes sold for more than $1.8 million (with exceptions), will generate about $5 million yearly, which the city would apply to affordable housing initiatives, shelters and prevention. That would  include rent vouchers, funds for people to avoid evictions, seed funding for developments and impetus to build more affordable family housing, rather than studios – all programs now in place that could expand.

Measure C (the Workforce Housing Affordability Act) would offer, they say, a breakthrough moment, not a “home run swing” in the affordability and homelessness fight. It’s the art of the possible in a time of too many impossible demands.

During our endorsement meeting, proponents told Lookout that the city has spent about $500,000 per year for the past 2½ years for housing and homelessness aid and has used it to help 800 people yearly. 

Measure C’s $5 million, they say, would give the city 10 times that power.    

That seems promising, exhilarating even – if we believe the city is headed in the right direction. 

What Lookout doesn’t know – and what we challenge the city to produce – is an accounting of how it has spent that $500,000 on affordable housing. When we asked, we got a partial accounting – including that in 2022-23, the city paid $108,000 to landlords to prevent eviction. 

This is one good datapoint, but we think we and the voters need to know more. 

We’d like the city and proponents of Measure C to help us and the public understand how 800 people have benefited and how that model will work when scaled up. We understand the money might have been intermixed with other programs’ funding to maximize impact; still, the city should offer as much transparency as possible. With that kind of accounting, voters could feel good about multiplying that work.

We’d like to see this before the Nov. 4 election, and believe it’s essential in winning the minds and hearts of the voters.

If passed, 87% of the Measure C money will be earmarked for affordable housing initiatives and 10%, or $100,000, supporters say, will be funneled into homelessness prevention efforts. That is five times more than the city currently spends and could be what finally allows Santa Cruz to make more progress on getting our unhoused housed.

The measures are not fun to read. Measure C includes exemptions for low-income households (below 60% of area median income), most older adults and 100% of below-market housing developments, schools and religious institutions. Its transfer tax offers progressive tiers — 0.5% for sales over $1.8 million up to $2.5 million. It applies higher rates up to 2% on larger sale amounts, subject to a cap.

So, for instance, a sale of a home for $2.4 million would incur tax of $3,000; that’s .5% of $600,000, the increment above the $1.8 million floor. Opponents of C say this might add significant burdens to a buyer, slow a sluggish market or keep folks from selling homes. 

We’re not convinced. We don’t think these fees – significant as they are – will prevent sales of such expensive homes, even as they edge toward the median cost in Santa Cruz. 

Measure B (the Workforce Housing and Climate Protection Act) offers a watered-down, warped version of Measure C. Even its backers, the Santa Cruz County Association of Realtors, know it has flaws and wouldn’t be miffed if it didn’t pass. It aims to generate $1.3-$2.3 million via a lower parcel tax of $50 and real estate transfer taxes that start when houses sell for $4 million and more. 

It was written in protest – and is intended to sow voter confusion. Keeley and others had early talks with the realtors group, which foundered and produced this confusing-to-voters result.

Its sole purpose is to kill Measure C.

While we hear and appreciate the good questions about process and consensus the realtors groups raise, we wish all this vitriol could have been avoided. We wish our leaders had spared us this circus. 

In the end, though, as we vote, we have to sort through the debris of lost consensus and recognize Measure B as a classic spike campaign – something we haven’t seen in local politics in decades, and hope is a one-off.  

The unnecessary messiness threatens to torpedo the real good Measure C  could do. But it shouldn’t.

The argument comes back to that big, ugly statistic: Santa Cruz is the highest rental market in the country. 

If we can make it marginally better by building more affordable housing, we have to try. 

We say yes on C. No on B. But with the caveat that we want the city to show effectiveness on how it’s been spending that $500,000 before Nov. 4. 

Let’s give the city tools, but also keep it accountable.