The kinds of projects that the Santa Clarita City Council and city officials have worried about for years — proposals for relatively large-scale developments over which they have no real oversight — could be coming home to a neighborhood near you.
A slew of applications meant to take advantage of state mandates that remove local control over the decision-making process on everything from aesthetics to density and parking have brought projects to City Hall’s doorstep that, under normal conditions, wouldn’t be allowed due to city guidelines for such projects.
In August, for example, just as the city was debating final approval for Shadowbox Studios — a 1.2 million-square-foot film-production facility on the border of North Newhall and Placerita Canyon — City Hall was trying to figure out what to do with a series of proposals from the same developer: one for a little over 1,000 apartment units north of Newhall Avenue, by Sierra Highway, less than 2 miles due east from the studio’s entrance; and a pair of projects about a half-mile east of The Old Road, near the intersection of Fambrough Street and Ebelden Avenue.
A statewide legislative push to make housing more affordable everywhere, including the Santa Clarita Valley, overrides many of the local considerations that might have slowed certain large-scale affordable housing projects from going forward locally.
Now Santa Clarita City Council members don’t seem to have a say, and Santa Clarita Mayor Jason Gibbs is none too happy about the city’s lack of having a say-so.
“Since our inception, Santa Clarita has advocated and fought to retain local control and decision-making on projects and proposals that affect our community,” he wrote in a text Friday. “Bills like (Senate Bill) 330, SB 4 and SB 423 are all designed to intensify the development of housing products by ignoring local zoning and planning efforts and minimizing our opportunity to require necessary infrastructure to accommodate these developments.“
The latest projects that have been brought to the city’s Planning Division manifest some of these concerns in the form of pre-applications: a 17.6-acre development south of Newhall Avenue at Sierra Highway for 1,020 units; one just north of Newhall Avenue, also along Highway 14, that calls for a six-story residential tower and 106 units per floor, about 630 units; a project just northwest of Fambrough Street and Ebelden Avenue — about a half-mile west of The Old Road, which would put 1,120 apartment units on about 17 acres.
Debbie Flood, who lives in a home across from where the project is being proposed, said she moved to the neighborhood from Valencia Fairways a couple of years ago, and wasn’t happy to hear about the proposal.
“You move into a home because you want a residential neighborhood,” Flood said last week while she was tending to her yard off Fambrough Street. “That would be horrible, there would be more traffic, there’d be more congestion … this is residential.”
A city vision
Prior to the dissolving of redevelopment agencies in 2012, Santa Clarita had spent millions of dollars and years of planning to renovate Newhall, upgrading the downtown area surrounding Main Street to make it the walkable and growing attraction it is today.
There were high hopes for the land just down the road where drivers entered Newhall from Highway 14 as well.
“The city has envisioned a gateway-to-Newhall-type, high-quality, mixed-use project (for that area),” said Jason Crawford, director of development for the city of Santa Clarita, mentioning Newhall Crossings just down the street as an example of what the city would like to see.
A Beverly Hills-based company, Sotto Capital Group, is using Senate Bill 330, the Housing Crisis Act of 2019, to propose 1,656 market-rate and low-income housing units in Elsmere Canyon, north and south of Newhall Avenue on vacant land between Highway 14 and Sierra Highway.
HSH Management CEO Henry Shahery, who is listed as the property’s owner, has not responded to a call seeking comment on the projects.
The city is working on reviewing the legality of what’s been proposed, Crawford said. The online information planners have is a bare-bones proposal, which is what the state law requires to place the project in the queue for “consideration.”
When the past is prologue
As part of the state’s effort to “streamline” the approval process and get more houses built, if a developer promises a portion of affordable-housing units, it largely can bypass local oversight that a project might otherwise have.
The topic of the state taking away local control on housing decisions came up again during the approval of Shadowbox Studios, when Mayor Pro Tem Cameron Smyth said one of the biggest reasons he’s supporting the project, outside the economic benefits to the area, was a possible alternative.
“There have been a number of projects that have come, in the last maybe 60 days, that are looking to capitalize on state regulations,” Smyth said in a phone interview Wednesday, “state directives that would in essence allow the builder to circumvent the established density allowances for those properties and would put it well beyond what the city has already established.”
One famous project the city fought against, starting in 2002, Las Lomas, sought to put just over 5,500 units on 555 acres of the Newhall Pass in unincorporated territory that developer Dan Palmer was looking to develop. (Fraud allegations and lawsuits ultimately stopped the project’s progress in 2009 after the L.A. City Council denied it.)
Santa Clarita was able to work with the 5th District office in L.A. County and the city of L.A. with unified opposition, Smyth said.
However, the situation now with respect to a development proposed for Newhall, just north of the pass, is decidedly different.
“Certainly, the difference now, is these proposals within the city are relying on a right,” Smyth said, “which would supersede anything that we have in the city or in the unincorporated county.”
As city planner Dave Peterson explained it to the members of the Santa Clarita City Council’s Development Committee, their June 15 discussion about the plans for an affordable-housing project on Flying Tiger Drive really was just a courtesy.
Like all cities, Santa Clarita has requirements developers must meet under its municipal code, which include minimum spaces for parking, common areas and even storage space.
The city’s housing element, a state-approved plan, determines how many homes the city has a capacity to build in a 10-year housing cycle. It also guides this report by identifying the number of very low-income to market-rate housing units a city finds feasible.
In recent years, state legislation has slowly chipped away at what city leaders call local control, leaving little for the city to do but stand by as a developer decides what a project should or shouldn’t have or how many homes should be built in a particular area.
“What they do is they basically propose these things to us, and the city is not really in a position where we get to say no,” Peterson said to Gibbs and Councilwoman Laurene Weste back in June.
“If this was not an affordable housing project, or if these laws did not apply, it would be subject to review by the Planning Commission as a conditional use permit. But in this case, the state law prohibits the review and approval by the Planning Commission.”
Regarding the situation with state law, Gibbs said there’s also a reason the city tries to be careful in its planning for developments.
“As a city, we have a history of smart and balanced growth,” he said, “but these bills seek to damage that reputation and move toward a ‘product before planning’ model that will adversely affect our local communities.”
In response to a request to the city’s Planning Division, Santa Clarita officials this week released nine separate pre-applications that were received by the city in August. The applications contained plans for separate projects on two separate plots owned by HSH, which appears to share its Beverly Hills offices with Sotto Capital Group, a large public real estate investment trust based in Mexico, according to its website.
The application seeks a number of exemptions from the city’s code and ordinances that restrict how many housing units can be built per acre, as well as parking provisions, and what’s a bit frustrating to city leaders is that they have no say in whether to approve them due to state law.
“The city has established zoning for what we believe is appropriate for the city and for that specific area, which the state has signed off on,” Smyth said, referring to the housing element.
However, neither planned element matters if a project has a portion of its homes set aside for affordable housing, as all of these plans do.
The first of two pre-applications for where Fambrough Street ends, about a half-mile east of The Old Road, calls for 160 units, including 32 low-income units and 128 market-rate ones on 3.8 acres; and that’s proposed to be next to a collection of five-story residential buildings with 16 units per floor, totaling 960 units, with 192 of them considered low-income housing and 768 considered market-rate. Under state law, one way a project can qualify for a “density bonus,” which would allow a project to exceed the number of residential units a city has zoned for a property, is to have 20% of the units be set aside for affordable housing.
The projects set for vacant land on the other side of Newhall, north and south of Newhall Avenue between Sierra Highway and Highway 14, also would bring low-income housing as well as hundreds of market-rate units. There are several different pre-applications, one for each of the parcels Sotto Capital hopes to develop, but in total the projects would bring a little over 2,700 units — including about 550 low-income units, according to the available documents.
The pre-applications are part of a legal requirement for the project to get considered under the current state housing laws, which expire by statute in 2025.
In 2019, Sen. Nancy Skinner, D-Berkeley, introduced Senate Bill 330 — which received no votes from both SCV legislators, Sen. Scott Wilk, R-Santa Clarita, and then-Assemblywoman Christy Smith, D-Santa Clarita — citing reports from the state’s Legislative Analyst’s Office that pointed to local governments as a big part of a complex set of problems.
California also was the 49th-ranked state in terms of housing per capita, and Gov. Gavin Newsom called for the construction of 180,000 homes each year just to keep up with population growth, and 3.5 million new homes between 2020 and 2026.
While developers have for years complained about the state’s stringent environmental laws and regulatory costs as the biggest impediment for more housing — SB 330’s analysis notes the costs for even affordable housing construction almost doubled from 2000 to 2016, from $265,000 to $425,000 — state lawmakers have looked to local governments to approve the building of more affordable, multifamily homes as their solution.
“A variety of causes have contributed to the lack of housing production,” according to a Senate Committee on Governance and Finance analysis of SB 330. “(Reports) argue that local governments control most of the decisions about where, when, and how to build new housing, and those governments are quick to respond to vocal community members who may not want new neighbors,” the report states.
But it also notes concerns developers and housing advocates have cited for years.
“The building industry also points to (California Environmental Quality Act) review, and housing advocates note a lack of a dedicated source of funds for affordable housing. Many local governments have adopted policies that limit or outright prohibit new residential development within their jurisdictions, or implement restrictive zoning ordinances, or otherwise impose costly procedural and design requirements on building. (Skinner) wants to remove some of these barriers in areas where housing is most acutely needed.”
Building the future
The results have been slow to date, with legislation like SB 330, and SB 8, which is also meant to speed up the housing-approval process, leaving California 37th in new residential construction permits per 1,000 residents in 2021.
Both the state and L.A. County have been adding homes, but not nearly close to enough, according to data from the Federal Reserve’s Housing Inventory Estimate. Since SB 330 was signed into law in October 2019, the county has added about 50,000 new homes and the state has only added about 235,327.
The new projects being proposed — the low-income housing development being constructed near the site of the old Canyon Country community center, the Elsmere Canyon projects and the ones closer to The Old Road — demonstrate the divide between what the city is trying to plan for and the state’s solutions for a crisis.
Crawford said the next step for the city is to review the pre-applications and determine if there are any legal questions for staff, a process that’s still underway.
“We have a pre-application,” Crawford said, referring to the plans. “Basically, the idea for that is that it would hold a place in line for an application. The city’s first step would be to verify the legality of the proposed project.”