August 3, 2017

Los Gatos Town Council approves North 40 Phase I project, but fight to define the Town’s character continues


On Tuesday, August 1st, the Los Gatos City Council approved the North 40 Phase I project proposed by Summerhill Homes, Grovesnor Americas, and Eden Housing, bringing a close to a highly contentious application process that started a decade ago.  After rescinding their September 2016 resolution to deny the project (as ordered by the Court), Mayor Sayoc, Vice Mayor Rennie, and Councilmember Jensen voted to approve the application, while Councilmember Spector opposed and Councilmember Leonardis abstained.

As far as size goes, Los Gatos is one of the smaller jurisdictions in Santa Clara County.  It is one of two that calls itself a town rather than a city (as those opposed to the project loudly called out), and it has a RHNA allocation of 619 housing units, which falls far below the countywide average allocation of 3,677 units.  So why was this decision so critical?

Think Regional, Act Local

For SV@Home and many other housing advocates, this project is about more than just the North 40 or even Los Gatos.  It is about every jurisdiction – big and small – doing its part to provide housing for our growing population, including the thousands of workers who have to commute every day from outside the County because they can’t find an affordable home closer to where they work.  It is about equity and making room for positive and necessary change.  It is about responsible governance and upholding critical State laws, including Housing Element Law and the Housing Accountability Act, which was established with the intention of to preventing exclusionary communities that result from “problems in some cases where local governments adopt housing policies and then fail to comply with their own policies when specific projects are at stake.”  As SV@Home stated in our August 1 letter to the Council,

To deny the project or subject it to any further delays is a disservice to the Town’s public engagement process, flaunts State Housing Law, and only serves to exacerbate the housing affordability crisis faced by the Town of Los Gatos and all its neighbors.”

These are the facts that we laid out:

  • A net 100,000 workers travel into Santa Clara County each day. Many workers in the Town, such as those employed at Netflix and Roku, make good wages but have few housing choices.
  • In fact, 93 percent of the Town’s workforce commutes in from other places in the Bay Area and beyond.
  • With a median home sales price of $1.7 million, a prospective Los Gatos household would need to earn more than $300,000 annually.
  • And with the median rent for all properties at $4,900 monthly, a Los Gatos renter needs an income of $196,000.
  • Between 2007 and 2014, Los Gatos addressed only 41% of its total housing need and only 13% of its affordable housing responsibilities. From 2014 to today, the Town has permitted only 26 housing units, 4% of its regional need goals.
  • According to the Town’s Housing Element, “given Los Gatos’ aging population, senior housing is a significant issue for the Town.” And yet, the Town only has 150 affordable homes for seniors.

At the same time, this is also about all of the benefits that the North 40 project will bring to the Los Gatos community.  Vice Mayor Rob Rennie reminded us of this during the deliberations:

Senior housing is a strong need with our aging population, and affordable senior housing even more so. In 15 years, Los Gatos has produced 15 very low-income senior units, which shows how hard it is to produce them.  This project produces 49, and at the current rate it will take Los Gatos 360 years to produce as many units… It is a herculean accomplishment.

Affordable market rate workforce housing is a crisis in our Valley. We only build somewhere around one third to one quarter of the housing units as jobs that are generated in the valley. Since we can’t afford to subsidize housing for moderate income households – there’s not enough money to subsidize even low-income households, it has to be built at market rate. The only way to make it affordable for moderate-income households is to build it smaller in the form of condos and townhomes.  This project has …over 140 units that are pretty small sized, so that’s really helping the problem. If you’re a moderate income person living in Los Gatos, this is a much more affordable choice than our median home price that was listed at $2 million in June… If an LG worker can live in the North 40, it significantly improves their quality of life by cutting their commute short, and it improves ours by reducing the traffic they’d create by commuting to Los Gatos.

Vice Mayor Rennie also noted several other important benefits such as traffic improvements at Lark and Los Gatos Blvd that are slated to reduce delays by 26%, $6 million for the Los Gatos Unified School District, in addition to $1.9 million annually for schools through property taxes, plus $800,000 in property taxes to the Town of Los Gatos annually.  In the North 40 itself, Town residents will enjoy new neighborhood-serving restaurants, new public open space.

Redefining Town “Character”

Vice Mayor Rennie also raised an interesting point in response to a sentiment that we often hear at Council meetings in many cities – that new development will destroy the “character” of a city.  The Vice Mayor cited a Los Gatos Magazine article, “A Town Not a City: Structures Can’t Change the True Character of Los Gatos” that states “We have the look and feel of Los Gatos not by structures alone, but by our relationships, our sense of commonality, our respect for one another, our civility in our political discourse, our common bond and identity as Los Gatans.”  This is something to remember, as what makes Silicon Valley great are the people, and we need to make sure that our communities are not lost because residents get priced out and displaced.

Moving Forward

So where do we go from here?  The fight over the North 40 is actually not over.  There is still “The Northern 20” that will potentially be developed under Phase II of the North 40 Specific Plan.  But it appears that some Councilmembers may be interested in reopening the Specific Plan to change its policies and possibly add in new ones to address the community concerns raised in Phase I.  Mayor Sayoc stated, “Tonight, I am in a very difficult position of making a decision based on what I want to do versus what is dictated by the court’s decision. We can choose to engage in further legal fees, but frankly, I would like to use all of that money and that effort to look at what’s possible under Phase II.  Is it better to utilize our time and our resources in looking at the changes we can do in the future phases…”

We are not sure what this means, but SV@Home will continue to stay engaged.  The Council may move toward changing the specific plan as soon as its next meeting on August 15th, when it will vote on an emergency moratorium on development under Phase II of the North 40 Specific Plan.  We are concerned that future changes made could make it even harder to build housing in the North 40 plan area, so please continue to stay involved and check back on our website in the next two weeks for more information about the August 15th meeting.

Image from North 40 Phase 1 Application