The Santa Maria City Council was unwilling to give up roughly 2 acres of industrial land to houses Tuesday night when it voted 4-1 to deny a pair of resolutions that would have paved the way for an affordable-housing project.

The council heard roughly two hours of testimony, including 13 speakers against the project proposed for a vacant lot on Oakley Court. The project opponents were mostly business owners or industrial property owners near the site.

The majority of the council said they were concerned about further residential encroachment on established businesses, and they did not want to encourage residential development on the city's industrial land.

“I am not willing to give away industrial property,” said Councilwoman Alice Patino, who said that she thought it was the right project for the city, just in the wrong location.

Councilwoman Hilda Zacarias was the only dissenter, and noted that she was siding with families that would be afforded the opportunity of a safe place to live.

However, all five council members expressed concern about the developer's request to adjust the appeals process in order to meet a financing deadline.

Developers proposed 36 affordable units on a 2.3-acre, triangular site off Oakley Court. The Planning Commission gave the project, dubbed Villa del Sol, a positive recommendation despite receiving opposition from neighboring business owners.

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The proposal included two- and three-bedroom units in six two-story buildings, in addition to a one-story recreation and office building.

Seven letters in opposition to the project were part of the council report, and point to the incompatibility of residences next door to 24-hour industrial operations. That concern was repeated in testimony before the council.

The timing on the project is critical, project architect Gil Palacios told the commission and the council, which is why a change in the appeals process was sought.

The developer was planning to use tax credits from the California Tax Credit Allocation Committee (TCAC) to cover about 70 percent of the project financing, according to the council's written staff report. In order to accommodate the tax credit deadlines for this funding cycle, the developer was also seeking a reduction in the appeal period from 14 days to seven days.

Tax credits are competitive, and one of the criteria for a higher ranking application is whether the project is ready to proceed with development. Reducing the appeal period would allow the project to receive necessary city approvals before the tax-credit deadline.

However, with at least two lawyers in the audience representing property owners in the area, an appeal was likely, which also would have hurt the project's tax-credit ranking.

Mayor Larry Lavagnino and other council members said they were concerned that if the zone change were approved, but the tax credits were not granted, the city would still be stuck with high-density zoning on the site.

Malia Spencer can be reached at 739-2219 or mspencer@santamariatimes.com.

July 2, 2008