Santa Barbara Stalls on Housing Funds, Moves Ahead on Commercial Vacancy Program | Local News
The Santa Barbara City Council on Wednesday agreed to spend an extra $200,000 on vegetation management, reduce funding to Visit Santa Barbara by about $300,000, and move forward with a program to reduce commercial vacancies along State Street.
The actions were part of the council’s special Wednesday night hearing to vote on elements of the projected $471 million overall budget for fiscal year 2023.
The focus of the meeting was on the city’s $184 million general fund, which is expected to have a temporary $1.1 million surplus at the end of this fiscal year.
The city’s finance director, Keith DeMartini, said the surplus is largely because of a quicker recovery in transient occupancy taxes from the COVID-19 pandemic, combined with the city lowering its budget expectations in 2021 and 2022. By the end of 2023, however, the city is expecting a $2.3 million deficit.
The meeting — centered on council member requests to add to the budget — was a bit scattered, with council members relying heavily on DeMartini to explain the nuances of budget policy and shifting of dollars.
The council agreed to direct staff to work on a commercial vacancy ordinance to address the dozens of vacant storefronts on State Street and in the central business district. City leaders have been considering a commercial vacancy tax to encourage property owners to find companies to rent their spaces. The vacant spaces are unattractive to tourists and are sometimes magnets for members of the homeless population to loiter.
It’s unclear what form the program will take. Mayor Randy Rowse voted against the effort.
Councilwoman Kristen Sneddon experienced a mixed night with her priorities. She persuaded her colleagues to vote unanimously to spend $200,000 to help the fire department to fund vegetation management, to reduce the risk of wildfires.
“I want to make the case, and I have made the case before, that as a tourist town, if you look at these trends, when your revenues go down, it’s when you have massive fires, like the Thomas Fire,” Sneddon said. “You are not getting tourists, when the city is on fire.”
The expenditure was a one-time effort to clear the backlog of vegetation management needs within the department.
“We’re having an unexpected increase in TOT. It seems reasonable to me that that would come from tourists,” Sneddon said.
Sneddon, however, was unsuccessful in getting $200,000 transferred from American Rescue Plan Act funds that were originally set aside for a rent control study that was abandoned by the council last year. She did not get a second to her motion to apply that money to affordable housing.
Councilwoman Meagan Harmon challenged Sneddon on whether $200,000 would be enough money to be significant for the Housing Authority of the City of Santa Barbara.
Sneddon responded: “I don’t know if $200,000 would do anything, but I think something is better than nothing,” adding that she was certain that the Housing Authority could use the funds.
Harmon said $200,000 was not enough money and that the City Council instead should find a long-term solution to funding.
“That’s not to me anywhere near sufficient,” Harmon said. “I was hearing that $200,000 would be sufficient to really leverage anything. I thought the number was more like $2 million, $5 million, and that could be leveraged in a really important way.”
She said “it is imperative” to find a programmatic funding source for affordable housing.
Rob Fredericks, executive director of the Housing Authority, has been urging the council during budget hearings in May to use transient occupancy taxes to fund affordable housing programs. He said at the meeting that he was disappointed that affordable housing was not clearly identified as part of the city’s 2023 budget.
“I want to express mine and my team’s disappointment that housing was not identified as a priority issue in this budget,” Fredericks said. “Housing and homelessness is often referred to as Santa Barbara’s No. 1 priority to address, and I would be negligent in my position if I didn’t speak up tonight.”
Fredericks said the city is struggling to meet state demands to build new housing.
“Without additional funding, we know that once again we will underperform on this pressing housing shortage,” Fredericks said.
He said that he understood the serious budget situation the city was in, but noted that there are families on a six-year waiting list, or homeless, or commuting two hours a day to work in Santa Barbara because of a lack of a housing.
“I urge you to make your budget reflect your values,” Fredericks said.
Councilman Eric Friedman acknowledged the many needs of the city, but was conservative in his budget approach, noting that the city is struggling to retain workers and that labor negotiations are ongoing.
“The challenges we are facing are real, and the need to compensate our staff so we don’t lose them to other jurisdictions is real, and we have other bargaining units that are up that are going to increase that deficit,” Friedman said.