ARTICLE
The Chamber of the 1990s Recession and Rebound After the 1989 Loma Prieta Earthquake, much of what occurred in the early 1990s was rebuilding our downtown and the surrounding communities that were severely damaged. Out of the destruction that effected our lives, Santa Cruzans huddled up and began the recovery process. The damages scarred our county from the flood plain in Watsonville to the peak of the Santa Cruz summit, from the rural communities of Boulder Creek and Ben Lomond to downtown Santa Cruz. But we survived. While we could spend pages and pages reflecting about 1989, we choose to move forward. One particular business that lost its ‘home’ on Pacific Avenue, moved their business to a small corner lot (Cedar & Center) and served food from a trailer to stay in business. In 1990, Zoccoli’s was recognized as the Chamber’s business of the year. During the mid-late1990s Santa Cruz experienced one of its greatest economic booms in decades, fueled by the rise in the technology and internet sectors. According to a 2002 Projections Report by the Association of Bay Area Governments, more than 230,000 jobs were created in the Silicon Valley during the late 1990s, mostly in the internet and high technology sector. Santa Cruz shared in this job growth. By the late 1990s, the number of jobs in Santa Cruz increased from an estimated 15,100 during 1995 to a height of 18,601 by year 2000. However, the ensuing “dot.com” meltdown (2000-2001) and loss of 92,000 jobs in the Silicon Valley eventually spilled over into Santa Cruz. Santa Cruz lost 520 jobs in layoffs from various software and internet sector jobs and 600 jobs from the closure of Texas Instruments, one of the largest employers in the Santa Cruz area at the time. Moreover, Santa Cruz was further impacted by the closure of the Liptons Plant and Salz Tannery, which together contributed 247 jobs to the local economy. Employment growth, new jobs in technology, and an increasing professional workforce had a significant impact upon household income, which also affected housing opportunity. During the 1990s, the City’s median household income increased 59%, from $31,850 in 1990 to $50,600 by 2000. Through programs such as the Technology Exhibition Symposium, the Santa Cruz County Chamber helped businesses and knowledge workers connect to continue innovating here in "Silicon Beach.” In the 1990s, the Chamber helped Santa Cruz weather the dot-com bust. High technology had become the third pillar of Santa Cruz's economy, along with tourism and agriculture. Yet, with every upswing of the tech economy in Silicon Valley there is a downswing, too. When a nationwide recession hit Santa Cruz in the early 1990s, Chamber member banks offered loans to help businesses keep their doors open. In 1992, the Chamber continued to help growing businesses with organizations such as the Chamber's Women In Business group, a networking, education, and support group for women who work for local member-businesses, and the "Success Factors" seminar, precursor of the Women's Leadership Forum event. Those cornerstone events of the 1990s into the early 2000s have fallen aside in recent years. As we note, Chamber members come and go as time changes just as our focal points change to keep our members engaged. The Chamber, always a community catalyst, supported the development of the McPherson Center for Art and History in 1993 and in 1994 helped celebrate the opening of the Henry Mello Center for the Performing Arts in Watsonville. To influence policies that affect business and community life in Santa Cruz County, the Chamber formed the Community Affairs Committee (CAC) developed position statements on education, water, transportation, and housing throughout Santa Cruz County. The CAC acts as the Chamber’s clearing house on policy and politics getting chamber member input and working with our public sector partners to carve out policies that are both economically and environmentally sustainable. The 1990s marked another decade of our struggle with Mother Nature and man-made disasters. 1990 Meder Canyon Fire (Wild land Fire) — several acres consumed in 20 minutes. February 1995 (Flooding) — Santa Cruz was one of 57 counties declared disaster areas due to flooding. February 1998 (Flooding) — Santa Cruz was one of a number of counties declared disaster areas due to El Niño. These disasters remind us how we must work with nature on the coastal area of Santa Cruz County. One particular sticking point in our county that began to magnify was the affordable housing and growth limitations set by late 1970s and 1980s ballot initiatives. Employment and population growth throughout Santa Cruz County had increased the demand for new housing. When there is a limitation on available housing in a market it pushes down one such measure — vacancy rate. A certain number of vacant units are important to moderate the cost of housing and encourage property owners to maintain and repair their housing. The crisis we see today (2019) has taken decades to create — it was a precipice in the late 1990s. As housing prices and rents increased dramatically during the 1990s, City staff reported a rise in unpermitted accessory units and garage conversions. City code enforcement reports since the early 1990s demonstrate that up to 30% of the caseload is due to housing code violations in illegal living quarters. Unpermitted housing represents a public health and safety hazard in that a larger number have faulty wiring and electrical systems, inadequate plumbing and kitchens, inadequate parking, and fire code access violations. Housing prices have been a blanket problem as reflected in this 2002 City report. The Santa Cruz-Watsonville metropolitan area continued to be one of the most expensive housing markets in the nation. According to an annual survey conducted by the National Association of Home Builders, only 7% of the homes sold can be afforded by a family earning the median County income. According to the Santa Cruz County Association of Realtors, the median sales price of a single-family home in Santa Cruz County increased 46% between 1996 and 1999 alone. Moreover, unlike many areas where housing price increases slowed in 2000, housing prices in the region escalated an additional 40% in the cities of Santa Cruz and Scotts Valley and faster (60%) in Watsonville. (City of Santa Cruz 2002-2007 Housing Element.) As we closed out the last decade of the 20th Century, Santa Cruz County was at a crossroad where tech growth in Silicon Valley increased the tech scene in Santa Cruz — with it came a change in our demographic make-up — and younger entrepreneurial spirited folks were finding their way into our coastal lifestyle scene. Stay tune as the Chamber moves into the 21st Century.
The Chamber of the 1990s Recession and Rebound
After the 1989 Loma Prieta Earthquake, much of what occurred in the early 1990s was rebuilding our downtown and the surrounding communities that were severely damaged. Out of the destruction that effected our lives, Santa Cruzans huddled up and began the recovery process. The damages scarred our county from the flood plain in Watsonville to the peak of the Santa Cruz summit, from the rural communities of Boulder Creek and Ben Lomond to downtown Santa Cruz. But we survived. While we could spend pages and pages reflecting about 1989, we choose to move forward. One particular business that lost its ‘home’ on Pacific Avenue, moved their business to a small corner lot (Cedar & Center) and served food from a trailer to stay in business. In 1990, Zoccoli’s was recognized as the Chamber’s business of the year.
During the mid-late1990s Santa Cruz experienced one of its greatest economic booms in decades, fueled by the rise in the technology and internet sectors. According to a 2002 Projections Report by the Association of Bay Area Governments, more than 230,000 jobs were created in the Silicon Valley during the late 1990s, mostly in the internet and high technology sector. Santa Cruz shared in this job growth. By the late 1990s, the number of jobs in Santa Cruz increased from an estimated 15,100 during 1995 to a height of 18,601 by year 2000.
However, the ensuing “dot.com” meltdown (2000-2001) and loss of 92,000 jobs in the Silicon Valley eventually spilled over into Santa Cruz. Santa Cruz lost 520 jobs in layoffs from various software and internet sector jobs and 600 jobs from the closure of Texas Instruments, one of the largest employers in the Santa Cruz area at the time. Moreover, Santa Cruz was further impacted by the closure of the Liptons Plant and Salz Tannery, which together contributed 247 jobs to the local economy.
Employment growth, new jobs in technology, and an increasing professional workforce had a significant impact upon household income, which also affected housing opportunity. During the 1990s, the City’s median household income increased 59%, from $31,850 in 1990 to $50,600 by 2000.
Through programs such as the Technology Exhibition Symposium, the Santa Cruz County Chamber helped businesses and knowledge workers connect to continue innovating here in "Silicon Beach.”
In the 1990s, the Chamber helped Santa Cruz weather the dot-com bust. High technology had become the third pillar of Santa Cruz's economy, along with tourism and agriculture. Yet, with every upswing of the tech economy in Silicon Valley there is a downswing, too.
When a nationwide recession hit Santa Cruz in the early 1990s, Chamber member banks offered loans to help businesses keep their doors open.
In 1992, the Chamber continued to help growing businesses with organizations such as the Chamber's Women In Business group, a networking, education, and support group for women who work for local member-businesses, and the "Success Factors" seminar, precursor of the Women's Leadership Forum event. Those cornerstone events of the 1990s into the early 2000s have fallen aside in recent years. As we note, Chamber members come and go as time changes just as our focal points change to keep our members engaged.
The Chamber, always a community catalyst, supported the development of the McPherson Center for Art and History in 1993 and in 1994 helped celebrate the opening of the Henry Mello Center for the Performing Arts in Watsonville.
To influence policies that affect business and community life in Santa Cruz County, the Chamber formed the Community Affairs Committee (CAC) developed position statements on education, water, transportation, and housing throughout Santa Cruz County. The CAC acts as the Chamber’s clearing house on policy and politics getting chamber member input and working with our public sector partners to carve out policies that are both economically and environmentally sustainable.
The 1990s marked another decade of our struggle with Mother Nature and man-made disasters. 1990 Meder Canyon Fire (Wild land Fire) — several acres consumed in 20 minutes. February 1995 (Flooding) — Santa Cruz was one of 57 counties declared disaster areas due to flooding. February 1998 (Flooding) — Santa Cruz was one of a number of counties declared disaster areas due to El Niño. These disasters remind us how we must work with nature on the coastal area of Santa Cruz County.
One particular sticking point in our county that began to magnify was the affordable housing and growth limitations set by late 1970s and 1980s ballot initiatives. Employment and population growth throughout Santa Cruz County had increased the demand for new housing. When there is a limitation on available housing in a market it pushes down one such measure — vacancy rate. A certain number of vacant units are important to moderate the cost of housing and encourage property owners to maintain and repair their housing. The crisis we see today (2019) has taken decades to create — it was a precipice in the late 1990s.
As housing prices and rents increased dramatically during the 1990s, City staff reported a rise in unpermitted accessory units and garage conversions. City code enforcement reports since the early 1990s demonstrate that up to 30% of the caseload is due to housing code violations in illegal living quarters. Unpermitted housing represents a public health and safety hazard in that a larger number have faulty wiring and electrical systems, inadequate plumbing and kitchens, inadequate parking, and fire code access violations.
Housing prices have been a blanket problem as reflected in this 2002 City report. The Santa Cruz-Watsonville metropolitan area continued to be one of the most expensive housing markets in the nation. According to an annual survey conducted by the National Association of Home Builders, only 7% of the homes sold can be afforded by a family earning the median County income.
According to the Santa Cruz County Association of Realtors, the median sales price of a single-family home in Santa Cruz County increased 46% between 1996 and 1999 alone. Moreover, unlike many areas where housing price increases slowed in 2000, housing prices in the region escalated an additional 40% in the cities of Santa Cruz and Scotts Valley and faster (60%) in Watsonville. (City of Santa Cruz 2002-2007 Housing Element.)
As we closed out the last decade of the 20th Century, Santa Cruz County was at a crossroad where tech growth in Silicon Valley increased the tech scene in Santa Cruz — with it came a change in our demographic make-up — and younger entrepreneurial spirited folks were finding their way into our coastal lifestyle scene.
Stay tune as the Chamber moves into the 21st Century.