Council Approves RDA Loan For Habitat Project

Scotts Valley is a step closer to a new Habitat for Humanity townhouse development after the City Council voted unanimously to loan the organization $300,000 in affordable housing Redevelopment Agency funds Wednesday night.

The development will consist of three, three-bedroom townhomes on Blake Lane. The entire project is estimated at $1 million, and construction could begin within two to three months, according to Michael Bethke, board president of the Santa Cruz County Habitat for Humanity.

“We’ve been really wanting to do a project here for a long time,” Bethke said. “This is going to be our signature flagship project as far as incredible design and upscale amenities.”

The project, which will go before the planning commission on March 10, was designed by Fuse Architects in Capitola and will consist of high-quality, high-end architecture with public art incorporated into it.

Under the terms of the loan agreement, Habitat will pay back the loan with interest either within five years of the sale of the last unit, or within 10 years of the loan.

Bethke said he is confident that Habitat will be able to pay the loan off in the time frame given.

“Once we close the last unit, we’ll have the money to roll back into paying this off and, hopefully, we will have a capital campaign program already in place and we can maybe even [pay it off] ahead of time as well,” he said.

In March 2010, the Redevelopment Agency, which sets aside 20 percent of its revenue for affordable housing in the community, agreed to give Habitat $300,000 to subsidize the project. However, that money, along with other money the organization had raised still left a nearly $260,000 budget shortfall, Bethke said. The organization no longer receives state or federal funding and relies on donations and the “goodness of the community” to complete its projects, which is why Bethke said the loan was so important.

“This loan was a key bridge to see this project all the way through completion,” he said. “This will more than cover the deficit to get everything completed.”

Though the townhouses will be the first Habitat project in Scotts Valley, the organization’s Santa Cruz chapter has been around for 22 years and in that time has built 34 homes.

“I think you do a beautiful job in this community,” Councilwoman Stephany Aguilar said. “It’s just very difficult to find housing in the community that isn’t over $500,000.”

Carol Netzley, a Scotts Valley resident and Habitat board member, spoke in favor of the loan and what the project would bring to the area.

“We are not only building homes with Habitat, but we are building a community,” she said. “There is pride that goes along with not only the homeowner but the neighbors and the community.”

Councilman Randy Johnson thanked Habitat for not asking for money outright.

“This is a loan, just like any other loan for people who need it,” Johnson said. “We have affordable housing money, so this doesn’t come out of the general fund. And if you look at the site, this is going to be a tremendous addition to that neighborhood. It’s going to clean it up and be beautiful.”

Mayor Dene Bustichi said it was important to reiterate that the RDA funds are for affordable housing in Scotts Valley and can only be used as such.

“When we have an opportunity to do something like this and be able to spend that money here or loan that money, in this case, here in Scotts Valley and help people here in Scotts Valley, it becomes even more special,” he said. “Let’s start building.”