Dear Friends and Neighbors,
There is no shortage of controversial topics these days. Hopefully a vote on Mayor Keeley and my "Rail Trail Peace Plan" this Thursday will resolve at least one issue that has vexed our County for more than a decade.
Meanwhile, a contested housing project will be working its way to the Board of Supervisors meeting next Tuesday, the 9th. 841 Capitola Rd is a Builder's Remedy project that would place a five-story apartment building in a single family neighborhood. At the risk of providing too many details, I've shared what the County is dealing with in projects like this.
There are other housing projects coming to Live Oak too: including 245 units at 41st Ave. and Soquel Dr. (near Home Depot) and 100 town homes at 5940 Soquel Ave (on the frontage road near the Sheriff's Center). Hearing details are below.
I'm passing along an update on the Murray Street Bridge from the City of Santa Cruz. This is a City project that I have little to no control over. However, I'm glad to hear the City is considering a two-way light when one lane reopens in February 2026.
Also included is info on how to push back on the proposal to open California's coast to oil drilling.
More locally, your feedback is requested on a proposal for a half-basketball court or dog exercise area at Floral Park. Take the survey.
For something we can all agree on, we'll be celebrating the retirement and many accomplishments of County Executive Officer, Carlos Palacios on December 9th. Ironically, it will be at the Capitola Council Chambers because Board Chambers are under construction!
Finally, you can catch me for Office Hours tomorrow/Wednesday from 1:00 to 3:00 PM or for a Capitola Community Meeting with Councilmember Gerry Jensen on Saturday at 10:00 AM at the Capitola Library.
Best, |
Manu Koenig 1st District Supervisor, Santa Cruz County
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Vote on Rail Trail Peace Planat Thursday's RTC Meeting
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Image: Though it is not cleared for public use, children run across the Santa Cruz Branch Rail Line tracks in mid-county. Photo Credit: Santa Cruz Sentinel
It's time that we stopped fighting about the rail corridor and started enjoying it. That's why Santa Cruz Mayor Fred Keeley and I have proposed a "Rail Trail Peace Plan" for a vote this Thursday at the Regional Transportation Commission (RTC). You can read the details in our public letter to the rest of the RTC here. Since its initial release, four other commissioners have added their names as signatories to the letter: Scotts Valley Councilmember Steve Clark, Watsonville City Councilmember Eduardo Montesino, Capitola City Councilmember Gerry Jensen, and Second District Supervisor Kim DeSerpa.
The basic proposal is to build the Rail Trail over the tracks (the configuration known as the "Interim Trail") from the San Lorenzo River to Aptos without rail banking. Instead of rail banking, the RTC would work with the rail operator to declare this segment of the line out of service through an embargo, an Order of Perpetual Service Limitations (OPSL), or other means.
Using one of these methods to declare the line out of service will be significantly faster than rail banking. It will also avoid complications for Roaring Camp, the existing railroad company that operates an excursion service on a portion of the line in front of the Boardwalk.
It's now clear that the Interim Trail design is necessary to stay within our community's budget. The City and County Public Works teams have run into problems trying to design and build the trail next to the tracks (the configuration known as the "Ultimate Trail"). Namely, the Ultimate Trail is now facing a $72 million funding shortfall due to escalating construction costs and the huge number of retaining walls and new bridges it would require. These segments of the trail project have already received approximately $120 million in state and federal grants - we can't go back to ask for more.
The Interim Trail costs just half as much to build as the Ultimate Trail because it stays in the center of the corridor and can re-purpose many of the existing rail bridges. It provides all of the same active transportation benefits, or more, because it can be as wide or wider than the Ultimate Trail in all places.
Meanwhile, the Zero Emission Passenger Rail Concept Report, which the RTC will review on Thursday, shows that rail cannot be delivered before 2047 at the earliest. It would cost $4.28 billion to build and $34 million a year to operate (on the low end). That adds up to a 1.5% - 2.25% sales tax that our County would have to pass in order to bankroll it - and you would still have to pay a fare to ride!
Ridership is estimated at just 2,100 – 2,700 people per day. If we round that estimate to 2,500 people, that translates to construction costs of $1.7 million per rider and an additional $13,600 per rider per year to operate. This is crazy talk.
Personally, I'm ready to see this absurd train proposal permanently put to rest in the annals of "Santa Cruz's Dumbest Ideas." However, I'm willing to agree to the pro-rail elements of the Peace Plan in order to: Build the trail we all want as fast as possible Minimize disruptions for Roaring Camp - a beloved local business Preserve all of the grant funding we have received for the rail and trail corridor
If for some reason this plan fails to garner enough votes on Thursday, I will return to advocating that we simply rail bank and move on.
On the other hand, if this plan passes at the RTC, it is real cause for celebration. It will demonstrate that our community is capable of doing the opposite of Washington: radical collaboration instead of radical partisanship. The passage of this plan would also mark a critical turning point when donations for the Rail Trail go from paying for hateful political ads to buying undiscriminating benches and public art that will improve the trail. We will go from an era of 501(c)(4) political action committees to an era of 501(c)(3) public benefit non-profits. That is the Santa Cruz County that I want to live in and celebrate come the New Year.
The Rail Trail "Peace Plan" will be voted on during Item 26 at Thursday's RTC Meeting. You can attend in person at the Watsonville City Council Chambers (275 Main St, Watsonville, CA 95076) or via Zoom.
If you'd like to read more about this topic, the Sentinel and Lookout both have excellent writeups.
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A Preview of Next Week's Board of Supervisors Meeting
Note that the agenda will not be released until Thursday so item numbers are not yet available.
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Jurisdictional Hearing on 841 Capitola Rd |
Image: a rendering of the proposed apartment building at 841 Capitola Rd, as seen from Grey Seal Rd.
How Can a Five-Story Apartment Building Be Built in a Single-Family Live Oak Neighborhood?
Two words: Builder’s Remedy — a state law that allows developers to bypass most local zoning when a city or county does not have a state-certified Housing Element (housing plan). If a developer submits an application during such a lapse, local governments have little ability to deny it, or condition the project.
At the beginning of 2024, Santa Cruz County briefly fell into this category. During that window, local development firm Workbench submitted two Builder’s Remedy projects: 841 Capitola Rd: 5 stories, 57 units 3500 Paul Sweet Rd: 6 stories, 105 units
The Capitola Road project is further along in the permitting process, with Paul Sweet following a few months behind.
What Has Happened So Far?
On October 8, the County Planning Commission approved the Capitola Rd project on a 5-0 vote. Many commissioners expressed frustration but felt state law left them with no authority to do otherwise.
Why Are Neighbors Appealing?
Neighbors of Capitola Road have appealed the Planning Commission’s decision to the Board of Supervisors based on four main claims: The County’s Housing Element was already in “substantial compliance.” It was submitted to the State in February 2024 and—according to the appellants—should have been considered compliant by mid-March, nearly a month before the developer’s preliminary application was submitted. Health and safety impacts were not adequately reviewed. Access through Grey Seal Road lacks proper analysis. The project has no direct access from Capitola Road. Parking concessions were not properly scrutinized. The project provides roughly one parking space for every two units.
What Happens on December 9?
The Board of Supervisors will decide whether to take jurisdiction and review the project de novo—a full re-examination of the application. To do so, the Board must find either: If the Board votes to take jurisdiction, a new hearing will be scheduled in early 2026.
Was the County Really Out of Compliance?
I sympathize with the argument that our Housing Element should have been considered compliant before the developer filed its application. The Board approved the updated Housing Element in November 2023, six weeks before the deadline. But the State’s Housing and Community Development Department (HCD) delayed and then requested minor revisions—delays that pushed the County into non-compliance and opened the Builder’s Remedy window.
The Legislature could have amended the law to recognize local adoption as sufficient for compliance. Instead, they passed AB 1886, which states:
"A jurisdiction is 'in compliance' only when HCD issues a letter finding the element substantially compliant."
This gives the state control over the timeline—without bearing any of the consequences.
HCD did not issue Santa Cruz County’s compliance letter until April 12, 2024. Workbench claims it submitted its preliminary application on March 6, 2024.
How the State Is Enforcing Builder’s Remedy
The State Attorney General has aggressively defended Builder’s Remedy projects and gone so far as to issue legal alerts, warning counties and cities to comply. For example, in late 2023, the state intervened in a case involving La Cañada Flintridge, seeking a court order forcing the city to process a Builder’s Remedy application. The Court agreed, stating:
“The Housing Accountability Act must be interpreted to afford the fullest possible weight to the interest of housing production.” (Gov. Code § 65589.5(a)(2)(L))
After the Court declared a bond requirement of $14 million, the City dismissed its appeal in March 2025.
The Bigger Picture
Builder’s Remedy projects are result of dozens of state laws passed to force more housing construction by limiting local control. Santa Cruz County’s authority over such projects has been intentionally curtailed.
What I’m Doing
Even with the County’s limited authority, I’m working with County Counsel to explore every legal option to reduce impacts on the surrounding neighborhood. I agree with residents that the project conflicts with the County’s General Plan and undermines our local zoning standards.
I will continue to do anything within my power to improve this project. Ultimately, the best path to building more housing is to ensure it is built in a way that our community can embrace and be proud of.
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TEFRA Hearing on the Soquel Drive/41st Avenue Proposed Affordable Housing Development |
Image: The lot at the intersection of 41st Avenue and Soquel Drive near Soquel Village has an active proposal for 245 units of 100% affordable housing. Photo Credit: Kevin Painchaud / Lookout Santa Cruz
Also on the December 9 agenda will be a public Tax Equity and Fiscal Responsibility Act (TEFRA) hearing for the proposed affordable housing project at 41st Avenue and Soquel Drive. This hearing is required under federal TEFRA rules and gives the public a chance to comment on the use of tax-exempt financing that the developer is seeking for the project. The goal of the hearing is simply to gather community input before any final approval is considered.
The 100% affordable housing project would create new rental homes. Current plans call for 245 units, including many three-bedroom units, that would be offered at below market rates for individuals and families with lower incomes. This project is one of several efforts aimed at easing the growing housing challenges faced by residents throughout Santa Cruz County.
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Issuance of a Proclamation Celebrating the Career of Exiting County Executive Officer Carlos Palacios |
Image: Carlos Palacios is shown before he was sworn in as the County Executive Officer in 2017. Photo Credit: Tarmo Hannula/The Pajaronian
During the December 9 Board of Supervisors meeting, the Board will present a proclamation to recognize the tenure and significant accomplishments of Santa Cruz County Executive Officer Carlos Palacios, who will mark the end of more than three decades in public service. CEO Palacios, who became the county’s first Latino administrative leader when he assumed the role in 2017, previously spent 20 years as Watsonville’s city manager. His career has been defined by a steady presence during major challenges and a commitment to building stronger systems of service for county residents. During his time with Santa Cruz County, CEO Palacios guided the County through wildfires, a global pandemic, and historic flooding, consistently emphasizing collaboration, compassion, and long-term resilience. His leadership helped modernize county operations, expand access to services, and strengthen the county’s ability to respond to crises.
Among his most significant achievements was the development of the county’s first Strategic Plan, created with extensive community input to guide policy and operational priorities. The plan, supported by an accompanying Operational Plan and public performance dashboard, earned statewide recognition in 2021 for innovation in government operations. CEO Palacios also played a central role in the acquisition and transformation of 500 Westridge Drive in Watsonville, now the South County Government Center, greatly expanding access to services for Pajaro Valley residents.
His time with the County included additional milestones that will influence county systems for years to come. He helped establish the Office of Response, Recovery and Resilience, strengthening disaster preparedness and advancing efforts to address climate impacts. He supported the creation of the County’s Public Defender’s Office while partnering with the Sheriff’s Office to reopen the Sobering Center, providing care-focused alternatives to incarceration. He guided the unification of the Planning and Public Works departments into the Community Development and Infrastructure Department, improving customer service and permitting processes. He oversaw the launch of the Housing for Health Division, which integrates homelessness response with behavioral health and supportive housing, as well as the Children’s Crisis Stabilization Center, Focused Intervention Teams, and mobile crisis response units. He also spearheaded the transition of Watsonville Community Hospital into a publicly owned healthcare institution.
As he prepares to step down, Palacios leaves behind an irreplaceable imprint on county government and a legacy defined by resilience, innovation, and a consistent focus on building a healthier, more equitable future for all residents.
The agenda will be posted by end of day Thursday December 4th here: https://santacruzcountyca.primegov.com/public/portal |
Update on the Murray Street Bridge
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Image: Aerial view of the Murray Street Bridge. Photo Credit: City of Santa Cruz
While the Murray Street Bridge project is a City of Santa Cruz project, it directly impacts unincorporated County residents every day. For this reason we're sharing updates on the City's efforts.
Harbor Rail Bridge Update
Over the past several months, the City of Santa Cruz partnered with the Regional Transportation Commission and Progressive Rail to explore a temporary walking and biking path on the Harbor Rail Bridge. After reviewing design options, funding, early access approvals, and on-site conditions, staff identified several concerns, including seismic deficiencies on the rail bridge, challenges meeting ADA requirements, insufficient lighting for safe public use, and difficulties securing insurance. Because of these combined issues, the City Council chose not to proceed with a temporary path.
Partial Reopening
In February 2026, one lane of the Murray Street Bridge will reopen for cars and bikes, and two-way pedestrian access will return. The City of Santa Cruz is also evaluating the potential use of temporary traffic signals to help manage alternating one-way traffic once the single lane is reopened. The east harbor access path under the bridge is expected to reopen in January 2026.
Upcoming Full Closures
A second full bridge closure is scheduled for June through August 2026 to relocate the regional sanitary sewer main on the south side of the bridge. This critical pipeline serves about 35,000 residents and must be moved during the summer low-flow period. In-water construction work can occur only during the June to October 2026 work window to protect marine life and maintain worker safety. Two additional short closures are planned later in the project: one week in February 2027 and two weeks in December 2027. Harbor access paths under the bridge will also have temporary closures during 2027 as needed.
Project Sequencing and Timeline
Certain phases of work can only be completed during summer months or within specific in-water work windows, so project sequencing must follow a set order. The project remains on schedule and is expected to be completed in January 2028. Construction typically occurs Monday through Friday from 7 AM to 6 PM, with occasional Saturday work.
For more information on detours, timelines, and construction details, visit the project webpage here. |
Image: An oil rig in front of Santa Cruz Island, near Santa Barbara. Photo Credit: UCG/Universal Images Group via Getty Images
The Trump administration’s draft five-year offshore oil and natural gas lease plan would reopen California’s coastal waters to oil and gas drilling for the first time in four decades – proposing up to six lease sales between 2027 and 2030.
Our coastline, our local economy, and the rich ecosystems that define this region cannot be placed at risk by offshore oil drilling in areas that we expected to be permanently protected.
In response to these developments, the Board of Supervisors is taking proactive and coordinated action to defend our coast. We are reactivating the historic Outer Continental Shelf Local Government Coalition, the same alliance that successfully halted offshore oil drilling along the California coast in the 1980s.
You can learn more and sign up for updates at SaveMyCoast.org, where additional tools will be available as soon as the federal proposal is open for public input. The site will also provide a direct avenue for you to submit comments to the U.S. Department of the Interior.
We are joined in this effort by the City of Santa Cruz, Sonoma County, and many others throughout California who are united in opposing new federal drilling proposals. This broad coalition reflects a shared commitment to protecting our coast.
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Feedback for Future Projects at Floral Park
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Image: Floral County Park lawn area. Photo Credit: County Parks Department
The Santa Cruz County Parks Department wants your feedback on future projects at Floral Park on 38th Ave!
Generous local donors have offered to fund construction of a half basketball court at the park. Other residents have asked for a more formalized dog exercise area. Any change begins with an update to Floral Park's Master Plan, which the Parks Commission will review next Monday, December 8. An official vote by the Parks Commission, to approve Master Plan updates, will take place during a Parks Commission meeting in early 2026.
Please provide input on which version of the Floral Park Master Plan you prefer, here:
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If you'd like to attend the Santa Cruz County Parks Commission Meeting where these changes will be reviewed, it will be at:
Monday, December 8th, 5:00 PM Simpkins Family Swim Center Community Room 979 17th Avenue Santa Cruz, CA 95062
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5940 Soquel Avenue at the County Planning Commission Next Week
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Image: Rendering of KB Homes proposed development. Photo Credit: Santa Cruz Local.
The parcel next to the Sheriff's Center in Live Oak, which was once considered by Kaiser for a large medical building, now has a proposal that matches its current zoning for housing. On Wednesday, December 10, 2025, the County Planning Commission will hold a hearing about the proposed residential development at 5940 Soquel Avenue. The proposal, submitted by KB Homes, is to build 100 residential units on the parcel on the south side of Soquel Avenue. The site is zoned RM-2-R and proposes development of 100 townhome-style units across multiple buildings; the application requires several discretionary approvals including amendments to the Planned Unit Development ordinance, a land division, and a site development permit with design review. Part of the environmental review process also includes biotic and soils reviews. These are some of the specific items the Commission will evaluate when considering whether the proposal meets county standards and mitigation requirements. The staff report and supporting materials will be published here no later than the Friday prior to the December 10 hearing. I encourage you to review the documents; you may also submit written comments to county planning staff so your perspectives are part of the public record, and even attend the Planning Commission meeting to address the Commission directly.
If you go:
Wednesday, December 10th, 9:30 AM County Government Building – Basement 701 Ocean Street in Santa Cruz
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Image: Capitola Library with meeting details. Photo Credit: Lookout Santa Cruz
Wednesday, December 3 - Office Hours from 1:00 PM to 3:00 PM. Come visit me at the Sheriff's Center, 5200 Soquel Ave, Santa Cruz CA 95062. Bring your questions and meet with me one-on-one. As always, first come, first served.
Thursday, December 4 - Regional Transportation Commission at 9:00 AM. The meeting will be held at Watsonville City Council Chambers, located on the top floor of 275 Main Street, Watsonville, CA 95076. and via Zoom.
Saturday, December 6 - Community Meeting with Capitola Councilmember Gerry Jensen starting at 10:00 AM. A casual, drop-in event to hear updates on Capitola housing, Rail Trail and other local issues. The meeting will be held in person at the Capitola Branch Library, located at 2005 Wharf Road, Capitola, CA 95010.
Monday, December 8 - Parks Commission at 5:30 PM. The meeting will be held at the Simpkins Family Swim Center/Live Oak Library Annex Community Room, located at 979 17th Avenue.
Tuesday, December 9 - Board of Supervisors Meeting starting at 9:00 AM. The meeting will be held via Zoom and in person at the Capitola City Council Chambers, located at 420 Capitola Avenue, Capitola, CA 95010.
Wednesday, December 10 - Planning Commission at 9:30 AM. The meeting will be held at the County Government Center Community Room, located in the basement at 701 Ocean Street, Santa Cruz, CA 95060 and via Zoom.
Tuesday, December 16 - Board of Supervisors Meeting starting at 9:00 AM. The meeting will be held via Zoom and in person at the County Government Center Community Room, located in the basement at 701 Ocean Street, Santa Cruz, CA 95060.
The County Board Chambers is currently under renovation through January 2026. Board meetings will be held at various locations throughout the County of Santa Cruz during this time. The Fall 2025/Winter 2026 meeting schedule with updated locations can be found here.
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