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Open the Last Space

[whitespace] Stephany Aguilar
Photo by George Sakkestad

Green Acres: Scotts Valley City Councilmember and former Mayor Stephany Aguilar opposes building 145 homes on the pristine Glenwood Drive property.

For 33 years, Scotts Valley growth has proceeded virtually unchecked. Now some citizens are saying enough is enough.

By John Yewell

THE CURRENT MAYOR is for it. The last mayor is against it. One study says the housing development will make a positive economic contribution to the city. Another says it will be a negative. Supporters say the city has enough water. Opponents say the city is running out of water. The developer says his project is the only viable option. Preservationists say money is available to purchase the property.

And finally, both sides say they are the ones trying to preserve open space.

On June 8, Scotts Valley voters will go to the polls and decide whom they believe. In the end, the choice may be entirely visceral: Do they want 145 homes built on the city's last major open space?

The battle over Palo Alto developer Charles (who goes by "Chop") Keenan's proposed 200-acre development on pastureland along Glenwood Drive is shaping up to be Scotts Valley's version of the battle over Lighthouse Field in Santa Cruz 25 years ago. That property was preserved as open space only after hard-fought political, legal and financial hurdles were overcome--and helped shape a generation of commitment to open-space preservation in the city.

But Scotts Valley has always been different. This is a city that was born in 1966 out of a desire to go its own pro-development way. As evidence that that ethos is alive and well, homegrown preservation forces in the battle over Glenwood admit they haven't encouraged Santa Cruz activists to get involved, fearing a backlash from voters who might resent outside meddling.

That's just one thing making this election so interesting. With the city near buildout, has the development boom finally hit the wall? Will Glenwood mark a watershed in Scotts Valley politics?

Hedging a Bet

DRIVE NORTH on Scotts Valley Drive just past Granite Creek Road, then angle left onto Glenwood Drive and continue north for about a half mile. There you'll come upon the broad meadowlands and rolling hills that make up the Glenwood project area, a landscape as exceptionally beautiful as the fight over its future is fierce.

The homes would be built on about 45 acres, which have been zoned residential some 30 years, with the rest left to parks or open space. Passage of measures O and P on June 8 would ratify Scotts Valley City Council-approved amendments to the city's specific and general plans, without which Glenwood cannot proceed. A "No" vote on either measure defeats the current plan.

Because there is no money available to buy the land to preserve it without increasing taxes, "there is no viable preservation option"--or so says Kerry Williams, Keenan's Glenwood project manager. If Keenan is offering to preserve most of it as open space anyway, she argues, "why should voters pay for something they can get for free?"

In one sense, that is what this election is about: fixing the value of the land, both monetarily and psychologically to the community. But value is a moving target, and whether there really is a "viable preservation option" for Glenwood hinges in part on whether voters approve the project.

Williams gauges the property's worth in terms of an approved project, basing it on the market value of its combined developable lots. In other words, the value of the property depends on the value of the project. Under that formula, she arrives at a figure of between $15 million and $20 million for the 145-lot, 200-acre property--although she hedges by saying it would be worth a "minimum of $10 million."

Her valuation only becomes a reality if the "Yes" votes prevail. A "No" vote would cast doubt on the viability of the development and thereby suppress the value of the property, making preservation a stronger option by holding down the cost of doing so.

Williams responds by insisting there is no money to buy the land for what Keenan says it would be worth, although the purpose of a purchase by preservation interests would be to prevent those houses from being built.

Knowing what the land is worth to Keenan would be simple enough: his purchase price is spelled out in his development option with the bank. But Keenan has not made that amount public, and Williams declines to disclose terms of the agreement, including its duration. Plan opponents have estimated Keenan's cost to acquire the land at $7.2 million if the development plan is approved, but Williams denies this.

Santa Cruz voters were faced with a similar argument last November, when they voted to approve a bond measure to preserve all, rather than simply a majority, of the Bombay property. That 250-acre property--which had the lower-valued zoning designation of "commercial agricultural" but had spectacular ocean views and potential for large-parcel, high-end homes--was sold to preservationists for $3.9 million.

Honey Pots

IS THERE A VIABLE preservation option? Many people, Assemblymember Fred Keeley among them, believe the money could be raised to purchase the property, but only if Scotts Valley voters demonstrate support for doing so. Keeley recently sent a letter to Scotts Valley City Councilmember Stephany Aguilar, a Glenwood development foe, saying that the Glenwood site would be an "excellent candidate" for funding.

"Statements that preservation of the Glenwood land as a public park would be unfeasible or would necessarily require new taxes are unfounded and reflect basic misunderstandings of the process through which preservation is pursued," Keeley wrote.

Much of his optimism turns on statewide voter approval of Assembly Bill 18, a $1.5-billion environmental bond initiative awaiting legislative passage for inclusion on the November 2000 ballot.

Keeley aide Scott Bunn says that as watershed property Glenwood could qualify for part of the $200 million slated for the Coastal Conservancy. There would also be a $147-million pot available through the Wildlife Conservation Board.

In addition, Laura Perry, executive director of the Santa Cruz County Land Trust, wrote to Scotts Valley councilmembers last October that her organization "would enthusiastically lend whatever assistance [it] could" toward acquiring the property. Perry told Metro Santa Cruz that the land trust could raise up to half the property's appraised value--whatever that is.

"If the community says no dice to the development, that creates the potential for protecting the land," Perry says. "But [citizens] have to be ready to contribute." If not, she says, then voting for the project is "rational, if you buy the argument that you get a lot of [free] open space."

Part of the land's value to preservationists stems from the area's unique biological assets. The Glenwood plan sets aside 14 acres of wetlands and about an acre for species protection. But critics, fearing the size of the development and the introduction of non-native plants and domestic pets, say only preserving the entire property will protect it. Keeley's letter points out that Glenwood "is home to several 'special status' plant and animal species, several of which are listed or under consideration for listing under the state and federal Endangered Species Acts," such as the Ohlone tiger beetle.

He cites the Jan. 24, 1997, issue of Science magazine, which calls Santa Cruz County one of two counties in the country known as biological "hot spots" for endangered species. Within the sensitive "Felton quadrangle," the Glenwood site, according to Keeley's letter, is a "hot spot within a hot spot."

Dueling Calculators

WITH DEVELOPMENTS of this kind, it's not unusual for developers to make a lot of promises, and Glenwood is no exception--the result being a dispute over the economic impact of the development. Will the $8.6 million in fees touted by the promoters cover the added costs resulting from the new homes in the long run?

Both sides have done studies. Not surprisingly, proponents found a small net benefit, while project opponents found a slightly larger net deficit.

Robert Clucas is the economic analyst for Hausrath Economics Group in Oakland who critiqued the economic analysis performed for Keenan by the firm Economic and Planning Systems. Given the margins of error, Clucas says, the two analyses are more consistent than they are different.

"One shows a small plus, the other a small deficit. That's why it's a nonissue," Clucas, a former UC-Santa Cruz student, says.

If the difference is negligible, what is the economic rationale for going ahead with the project? Current Mayor Randy Johnson believes the answer is in the balance of interests that are satisfied by the current Glenwood plan.

"I appreciate the instincts of people in trying to protect the property," Johnson says. "We did our best to keep down the number of homes. My intention was to preserve 70 percent of the land and at the same time respect the private property issue."

Previous Mayor Stephany Aguilar shares the goal, but goes one step further. "Free land?" she asks rhetorically. "I don't want to compromise the land itself."

Kerry Williams, following a tried-and-true strategy, argues that there really isn't a choice: if voters reject this plan, the next one might be worse.

"If voters overturn this project," Williams says, "we will come back with a proposal for 85 to 100 homes that is consistent with the underlying zoning." But she says the smaller development will not include any of the amenities included in this plan.

"We won't be able to afford to offer them," she contends.

The current package includes $1.8 million for the water district to help build a recycled water system and possibly drill more wells; $342,000 for extra police services; $1.4 million in public park and trail improvements; money to attempt to mitigate problems cause by the additional traffic; and developers fees for schools, libraries and the city's general fund. Williams says the total package of incentives is worth $8.6 million.

At least one part of that figure appears inflated. Williams values a donation of 10 acres for four new ball fields at $2 million, even though the entire 200 acres are currently assessed by the county at just over $4 million. Meanwhile, the organization Save Scotts Valley, which opposes the development, contends the $1.1 million worth of traffic improvements will be insufficient to deal with the additional traffic generated by the development and the new high school scheduled to open this fall across the street.

Randy Johnson
Photo by George Sakkestad

Better Than No Loaf: Mayor Randy Johnson supports the Glenwood project as a way to save 70 percent of the property as open space.

Aquifer World

PERHAPS THE MOST HOTLY contested issue in this election is water. The Scotts Valley Water District's own hydrology consultants, Todd Engineers of Emeryville, issued a report last February saying that the 25-square-mile Santa Margarita aquifer, on which Scotts Valley depends, is out of balance, losing an average of 328 acre-feet--more than 106 million gallons--per year over the last 10 years.

Given current operating conditions, Todd engineer Iris Priestaf wrote, "the aquifers will not be in balance soon or, for example, within the next 10 years."

The Todd report sent Glenwood proponents into damage-control mode. They point out that the district water recycling program will provide up to 300 acre-feet of nonpotable water a year suitable for landscaping. Money from Keenan would pay for hooking up major water users for about half that volume (one subsidy would go to Seagate Technologies), with the Glenwood development itself being a customer.

But water district president Paul Watkins, whose day job is as an administrator at Stanford Hospital, acknowledges that the water district has budgeted for the water recycling and will go ahead with it whether or not Glenwood is built.

And critics point out that in any event the recycling plan will not make up for all the future water connections on city drawing boards, such as the 180-room Inn at Scotts Valley scheduled to open in a few months and the 100 homes proposed for near the site of Borland International. Glenwood will use a little over 70 acre-feet of water a year, according to Watkins, with 24 of that coming from the aquifer and the rest from the recycling system. Project opponents call those figures optimistic, pointing out that the 24 acre-feet of fresh water used at Glenwood still would add to the net drain from the aquifer.

To combat the bad press, Watkins has tried to put the best face on the situation. In a recent letter to voters, Watkins points out that the water level in city wells "has increased over the past two years."

That's really got Betty Petersen steamed.

Petersen is a resident of the Manana Woods housing development in Scotts Valley and a 20-year observer of the falling water table.

"It's weasel wording," Petersen says of Watkins. "They're trying to persuade people there's no problem."

She says that the last two years have seen higher than average rainfall and lower than average temperatures. What matters, she says, is how some wells have fallen over time as much as 170 feet. She displays the monthly meter readings going back in some cases over 17 years to prove it, and says that many area wells are so low that the water is contaminated. Her own development has been advised by the County Health Services Agency to start looking for other water sources.

A recent study of the Santa Margarita aquifer confirmed these findings, leading Fifth District Supervisor Jeff Almquist, who chairs the Santa Margarita Groundwater Basin Advisory Committee, to come out against the Glenwood project. The group has begun a study to determine the most promising areas of aquifer recharge, which is vital to restocking groundwater supplies.

The real water mystery is that no one seems to know how big a population the aquifer will support, even with optimum pumping and water recycling programs in place.

"The district should work with the City of Scotts Valley to define a reasonable buildout population," reads the Todd report, "because groundwater levels cannot be stabilized until groundwater pumping rates level off."

The district is likely to extend its current water hookup slowdown past a September 1999 deadline, although Glenwood would not be subject to it. By virtue of its hookup to the recycled water system, Glenwood homeowners would not be subject to rationing during drought years--although other potential users of the recycled water system have not been made that promise.

What Matters

SINCE ITS BEGINNINGS, Scotts Valley has fed on its own growth, depending on fees from new developments to fund city services. But the city is running out of room to build and will eventually have to learn to live within its means. Even water district president Watkins acknowledges that the city doesn't know if it has enough water to supply its 10,000 residents, let alone the city's original target population of 15,000.

In his letter opposing the project, Supervisor Almquist brings up the buildout issue, which has loomed on Scotts Valley's horizon for years.

"The fact is," Almquist writes, "that each additional house built at this time represents a net tax burden to the city when all revenues, including developers fees, and all services are aggregated."

"New residents are service demanders," agrees Clucas. "The rule of thumb is that on the whole new residential subdivisions lose money for cities."

This emphasis on net financial analysis over deciding what is right for the community is called the "fiscalization of planning," says Clucas, and the planning community "rails against it."

"What matters here [in Scotts Valley]," Clucas says, "is what do we want to do with this pretty meadow?"

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From the June 2-9, 1999 issue of Metro Santa Cruz.

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