ARTICLE
Two very different discussions took place Tuesday at different locations about similar issues of environmental protection and economic sustainability. Here’s what happened on Tuesday afternoon: The Santa Cruz County Chamber held its relaunch of the Chamber’s lunchtime speaker series on the Chaminade patio overlooking Monterey Bay. Our guest speaker was California Controller Betty Yee. It was a beautiful late summer day with a light ocean breeze. The attendance at the luncheon was well below the Chamber’s average but those in attendance listened, learned and enjoyed Controller Yee’s strong grasp of all issues at every level of government — citing the Federal Reserve's recent rate increases and alerting that the Feds will again upperly adjust the rates to curb inflation. The rate presently is 5.5% in most markets, subject to change based on inflation. Yee commented that the Feds will continue to weigh in on inflation that was reported at 8.26% in August 2022. The stock market reacted significantly on Tuesday with the largest drop (over 1000-point drop in two years). There was a slight uptick recovery Wednesday, yet there is deep concern about inflationary increases. This week's inflation updates all but assure another aggressive rate hike from the Federal Reserve at next week's policy meeting. According to one report, the probability that the central bank will lift its benchmark rate by 75 basis points has jumped to 74% from 45% one month ago, while the odds of a 100 basis-point rate hike are now at 26% from zero over that same timeframe. A basis point is one-one hundredth of a percentage point. We will see what happens next week. Yee turned her attention to California. Despite the nation’s economic woes and the problems in Europe, including the ongoing war in Ukraine, she expressed high praise about California’s current economic picture. While citing gas prices which are seeing a drop from the early summer highs, increases in prices at the grocery stores, and the supply chain backlogs which have put a damper on consumer confidence, Yee remained upbeat about our present and future. California’s budget surplus is leading the way in addressing many of the issues facing the state by creating funding sources for homeless services, wildfires and natural resource protection, transportation improvements, education funding increases and a host of programs to address climate change. The Controller also reminded attendees that one of her primary duties is to be the state auditor on state agencies. She takes a very serious approach to that duty, mentioning that at the beginning of the pandemic in March 2020, a few months away from the state’s annual budget decisions in June 2020, she worried about how the state would fund itself in the last three months of that fiscal year. She called the Governor’s Finance Department and asked a simple question: “What is the state’s cash burn rate?” The reply was $1 billion a month. Yee calmly put into place financial tools to ensure the state was not out in funding markets during the pandemic. Tracking the state’s cash flow was important and critical during that period, as it is today. Yee noted with all the deep concerns about what’s happened in the pandemic years 2020-2021, and the current turbulent economic climate, California continues to be a world economic leader. Today, she said the state is the 5th largest economy in the world and closing in to overtake Germany as the #4 global economic leader by the end of 2022. Finally, Controller Yee brought it back home that our economic prosperity in California and specifically in Santa Cruz County is on fragile ground because of our decades-long struggle to keep up with housing supply and demand. She emphasized her strong environmental credentials, also expressing a need for CEQA reform, land use policy and a lack of political will to build more housing, which has forced the California Legislature and the Governor to clamp down with more oversight for housing at the local government level. Housing is the fundamental issue that can ensure a young student who goes to college at UCSC has a chance to stay in Santa Cruz if we build housing to meet our demand. Controller Yee said it is her passion to see that the place where she began her public service career can be the future place for the next generation. Meanwhile, in downtown Santa Cruz, the City Council convened their bi-monthly council meeting. Front and center on the council agenda was the Climate Action Plan that has been in the works for 18 months leading up to Tuesday’s public hearing. The City’s Sustainability and Climate Action Manager, Tiffany Wise-West, presented to the City Council the 147-page Climate Action Plan 2030. It is a very detailed and robust accounting of the recommended steps that the City can take to follow the state mandate to reduce carbon emissions by 40% by 2030 compared to 1990 levels. The City Council approved the plan on a 6-0 vote with Council member Justin Cummings absent. Santa Cruz Local did a very good write-up about the plan here: https://santacruzlocal.org/2022/09/13/climate-plan-approved-by-santa-cruz-city-council/. The key elements as reported by Santa Cruz Local are listed below: > Development of a city law on all-electric conversion of existing residential buildings by 2023 and existing commercial buildings by 2024. The law likely would target equipment for home heating, water heating, cooking and laundry dryers. > Removal of “obsolete” natural gas infrastructure in neighborhoods. City staff would work with Pacific Gas & Electric Co. to redirect money from natural gas pipeline maintenance to instead go toward electrification projects. > A push for Santa Cruz Metro to provide free bus passes for students. > A possible limit to parking for single-passenger vehicles Downtown. > Installation of at least 1,200 electric vehicle chargers for public use by 2030. > A policy for city leaders to prioritize electric municipal vehicles by December 2023. > Requirements for “secure” bike parking near public transit, busy areas and new commercial buildings. > Reestablishment of a city-wide bike share program. > A pilot program for time-based closures to vehicles in some business districts. The program aims to slow traffic and improve biking and walking. > “Efficient and equitable” land use policy. The plan calls for policies to “accelerate housing development and support commercial and industrial development in city limits, concentrating the most intensive growth in transit corridors and central areas of the city.” These policies would be incorporated into the next General Plan Housing Element update that the Council would approve next year. This plan would be an extensive overall of city zoning regulations as well as major land use decisions and policy changes that would be incorporated into the City’s next General Housing Element that would need to be approved next year. Two of the most challenging issues deal with an all-electric conversion of existing residential building units next year and existing commercial buildings by 2024. Like all significant changes to local government — a community buy-in is necessary to implement a sweeping policy change. The Climate Action Plan is big on potential shifts in personal lifestyle changes, all with well-intended environmental benefits. However, it seems to be shy on the economic analysis to implement this plan on a short time window by 2023, 2024 and 2030 to reach the state GHG emissions goal. A glaring omission is the cost of each element in the plan although, according to the staff report, “The City has $4.35 million in grants and other money to kick off the plan.” The Mayor and two Council members asked the critical questions: Mayor Sonja Brunner asked, “How could the city pay for some of the proposed actions?” Councilmember Renee Golder questioned whether it is possible that natural gas could be eliminated from homes, expressing concerns from residents who wrote comments about the plan. And Councilmember Donna Meyers asked if the plan aligned with downtown development projects — many of which are in the pipeline while others await the city to update the Downtown expansion plan before those potential projects move forward. The Climate Action Plan would certainly have an economic impact on those projects. The future of Santa Cruz is working at a trajectory that may not be realized in the timeframe outlined by this plan. All we need to do is look at the latest strategies to address our homeless population that has been a city-county proposal years in process without a clear path forward. I recall the Chamber leading our 2017 Community Leadership Visit on the subject of housing. The City leaders were deeply engaged on that CLV, and then Mayor Cynthia Chase pulled together a community process to address housing. A wonderful report was produced in June 2018 — called the Housing Blueprint Subcommittee Recommendations. 82 recommendations were put forward: https://www.cityofsantacruz.com/home/showpublisheddocument/71900/636691496807470000. How are we doing on initiating or implementing those recommendations? The short answer: It is a work in progress and far from reaching many of those recommendations. Again, according to the report, City staff will come back with a dashboard to pull together the timeline and estimate costs. Not to be critical — however, in the project development sector, understanding the economics of your proposal is step # 1 in the process. If the price to initiate, implement, entitle and build the project on a clear timeline is not established, the project will linger on a desk shelf. Let’s hope the city staff and the next City Council understand the economic and environmental balance that need to take place to meet these lofty goals.
Two very different discussions took place Tuesday at different locations about similar issues of environmental protection and economic sustainability. Here’s what happened on Tuesday afternoon: The Santa Cruz County Chamber held its relaunch of the Chamber’s lunchtime speaker series on the Chaminade patio overlooking Monterey Bay.
Our guest speaker was California Controller Betty Yee. It was a beautiful late summer day with a light ocean breeze. The attendance at the luncheon was well below the Chamber’s average but those in attendance listened, learned and enjoyed Controller Yee’s strong grasp of all issues at every level of government — citing the Federal Reserve's recent rate increases and alerting that the Feds will again upperly adjust the rates to curb inflation. The rate presently is 5.5% in most markets, subject to change based on inflation. Yee commented that the Feds will continue to weigh in on inflation that was reported at 8.26% in August 2022. The stock market reacted significantly on Tuesday with the largest drop (over 1000-point drop in two years). There was a slight uptick recovery Wednesday, yet there is deep concern about inflationary increases. This week's inflation updates all but assure another aggressive rate hike from the Federal Reserve at next week's policy meeting. According to one report, the probability that the central bank will lift its benchmark rate by 75 basis points has jumped to 74% from 45% one month ago, while the odds of a 100 basis-point rate hike are now at 26% from zero over that same timeframe. A basis point is one-one hundredth of a percentage point. We will see what happens next week.
Yee turned her attention to California. Despite the nation’s economic woes and the problems in Europe, including the ongoing war in Ukraine, she expressed high praise about California’s current economic picture. While citing gas prices which are seeing a drop from the early summer highs, increases in prices at the grocery stores, and the supply chain backlogs which have put a damper on consumer confidence, Yee remained upbeat about our present and future. California’s budget surplus is leading the way in addressing many of the issues facing the state by creating funding sources for homeless services, wildfires and natural resource protection, transportation improvements, education funding increases and a host of programs to address climate change. The Controller also reminded attendees that one of her primary duties is to be the state auditor on state agencies. She takes a very serious approach to that duty, mentioning that at the beginning of the pandemic in March 2020, a few months away from the state’s annual budget decisions in June 2020, she worried about how the state would fund itself in the last three months of that fiscal year. She called the Governor’s Finance Department and asked a simple question: “What is the state’s cash burn rate?” The reply was $1 billion a month. Yee calmly put into place financial tools to ensure the state was not out in funding markets during the pandemic. Tracking the state’s cash flow was important and critical during that period, as it is today.
Yee noted with all the deep concerns about what’s happened in the pandemic years 2020-2021, and the current turbulent economic climate, California continues to be a world economic leader. Today, she said the state is the 5th largest economy in the world and closing in to overtake Germany as the #4 global economic leader by the end of 2022.
Finally, Controller Yee brought it back home that our economic prosperity in California and specifically in Santa Cruz County is on fragile ground because of our decades-long struggle to keep up with housing supply and demand. She emphasized her strong environmental credentials, also expressing a need for CEQA reform, land use policy and a lack of political will to build more housing, which has forced the California Legislature and the Governor to clamp down with more oversight for housing at the local government level. Housing is the fundamental issue that can ensure a young student who goes to college at UCSC has a chance to stay in Santa Cruz if we build housing to meet our demand. Controller Yee said it is her passion to see that the place where she began her public service career can be the future place for the next generation.
Meanwhile, in downtown Santa Cruz, the City Council convened their bi-monthly council meeting. Front and center on the council agenda was the Climate Action Plan that has been in the works for 18 months leading up to Tuesday’s public hearing. The City’s Sustainability and Climate Action Manager, Tiffany Wise-West, presented to the City Council the 147-page Climate Action Plan 2030. It is a very detailed and robust accounting of the recommended steps that the City can take to follow the state mandate to reduce carbon emissions by 40% by 2030 compared to 1990 levels. The City Council approved the plan on a 6-0 vote with Council member Justin Cummings absent. Santa Cruz Local did a very good write-up about the plan here: https://santacruzlocal.org/2022/09/13/climate-plan-approved-by-santa-cruz-city-council/. The key elements as reported by Santa Cruz Local are listed below:
These policies would be incorporated into the next General Plan Housing Element update that the Council would approve next year.
This plan would be an extensive overall of city zoning regulations as well as major land use decisions and policy changes that would be incorporated into the City’s next General Housing Element that would need to be approved next year. Two of the most challenging issues deal with an all-electric conversion of existing residential building units next year and existing commercial buildings by 2024. Like all significant changes to local government — a community buy-in is necessary to implement a sweeping policy change. The Climate Action Plan is big on potential shifts in personal lifestyle changes, all with well-intended environmental benefits. However, it seems to be shy on the economic analysis to implement this plan on a short time window by 2023, 2024 and 2030 to reach the state GHG emissions goal. A glaring omission is the cost of each element in the plan although, according to the staff report, “The City has $4.35 million in grants and other money to kick off the plan.” The Mayor and two Council members asked the critical questions: Mayor Sonja Brunner asked, “How could the city pay for some of the proposed actions?” Councilmember Renee Golder questioned whether it is possible that natural gas could be eliminated from homes, expressing concerns from residents who wrote comments about the plan. And Councilmember Donna Meyers asked if the plan aligned with downtown development projects — many of which are in the pipeline while others await the city to update the Downtown expansion plan before those potential projects move forward. The Climate Action Plan would certainly have an economic impact on those projects.
The future of Santa Cruz is working at a trajectory that may not be realized in the timeframe outlined by this plan. All we need to do is look at the latest strategies to address our homeless population that has been a city-county proposal years in process without a clear path forward.
I recall the Chamber leading our 2017 Community Leadership Visit on the subject of housing. The City leaders were deeply engaged on that CLV, and then Mayor Cynthia Chase pulled together a community process to address housing. A wonderful report was produced in June 2018 — called the Housing Blueprint Subcommittee Recommendations. 82 recommendations were put forward: https://www.cityofsantacruz.com/home/showpublisheddocument/71900/636691496807470000. How are we doing on initiating or implementing those recommendations? The short answer: It is a work in progress and far from reaching many of those recommendations. Again, according to the report, City staff will come back with a dashboard to pull together the timeline and estimate costs. Not to be critical — however, in the project development sector, understanding the economics of your proposal is step # 1 in the process. If the price to initiate, implement, entitle and build the project on a clear timeline is not established, the project will linger on a desk shelf. Let’s hope the city staff and the next City Council understand the economic and environmental balance that need to take place to meet these lofty goals.