One of California’s iconic and picturesque resort hotels is at the center of a controversy that involves a prominent commercial real estate developer, a beloved church and dozens of upset neighbors.

Those worlds collided Wednesday when Rick Caruso, owner of the Rosewood Miramar Beach hotel, took his housing and luxury retail shop project to the Santa Barbara County Planning Commission. The plan has sparked widespread community interest.

“This project, as proposed, is a great loss for All Saints (by-the-Sea) Church,” said Channing Smith, the church’s rector. “Its impact will be great and one for which our community grieves.”

Caruso wants to build 26 affordable-housing units and eight market-rate units at the five-star luxury hotel at 1555 S. Jameson Lane in Montecito. He also wants to add about 17,500 square feet of high-end boutique retail shops, where a pair of jeans might sell for $1,000 and a handbag for $2,500.

The market rate units would block the mountain view from the church. Smith also said the developer should build the housing units north of the sanctuary so that the people who live there can be closer to the church property and the children could play at the All Saints preschool.

More than 115 people packed the Planning Commission room Wednesday, creating a standing-room-only crowd. Caruso appeared with his team, which includes his son Justin and a throng of public relations handlers.

Caruso, wearing a black suit, spoke proudly of his project and efforts to work with the community.

“At the heart of every Caruso project is an unwavering commitment to the greater community,” he said. “The result, a timeless collection of elegant, joyful places that reflect the spirit of the places where they live. They are intended to be comfortable, aspirational and captivating.”

The Miramar project, he said, takes the resort in a “new and exciting direction.”

“For us, our plan for the Miramar is a logical extension of taking good care of our workers,” Caruso said. “It is something I hope other companies take up. It could all start today.”

However, neighborhood critics say the housing units are a public relations effort to mask the benefits of the 17,500 square feet of new luxury retail shops. They worry the shops will bring new traffic from outside of the area.

They share concerns about the church losing its view, parking overall as well as the loud construction noise, at the same time Highway 101 is being widened.

“I totally oppose this project,” Eucalyptus Lane resident Anthony Donovan said.

He noted a couple of other construction projects in the neighborhood that are underway.

“It’s just going to be a total nightmare with traffic, with all this construction and moving dirt,” Donovan said.

Caruso pulled out all the stops at the meeting. He catered a coffee, breakfast and lunch bar on the sidewalk outside the county building. Containers of fresh fruit, boxes of BLT and veggie sandwiches, and bowls of kale salad covered the table. Lemonade and boxed water also were offered.

In the hearing room, he showed a polished promotional video that lasted more than six minutes, featuring a variety of testimonies from hotel supporters.

“We truly are a family-run company,” Justin Caruso said. “We have never sold a property, and we never intend to. We plan to be lifelong neighbors to this community. We really do see our employees as an extension of our family. They enrich our lives every time we step on the property.”

The neighbors also have expressed concerns that the project is being rushed so that it can gain approval before First District Supervisor Das Williams leaves office in January. He is a supporter of the project. The neighbors have more faith in Roy Lee, the supervisor-elect, and that he will listen to their concerns, preferring that he cast the vote on the project.

Santa Barbara County last month tried to skip a hearing at the Montecito Planning Commission, but after public outcry added a hearing on Oct. 18. The project is scheduled to go back to the county Planning commission on Nov. 1 for a final vote.

If it is appealed, which it likely will be, the Board of Supervisors would decide the fate of the project likely in December.

Marc Chytilo, an attorney representing All Saints, said the church supports the housing and wants it relocated near the All Saints preschool, instead of where it is now, “sequestered,” in the eastern parking lot. He called the fast-paced effort to approve the project “unprecedented.”

“The Coastal Act requires that there be a public understanding as well as involvement in this process,” Chytilo said. “There’s missing information.”

Ric Caruso said he doesn’t believe that the church is acting in good faith and that it just wants to stop the project. He said affordable units for employees are separate from the hotel to allow them “privacy,” so they can leave work behind when they go home.

The property currently has retail, and the new stores also would face inward. The Miramar is home to high-end brands such as Gwyneth Paltrow’s Goop Sundries, Italian brands Brunello Cucinelli and Loro Piana, and others. The new shops would be about the same size or smaller, Caruso said.

“In my experience, it’s not a mall that could survive financially anywhere else, other than being continuous to a resort,” Caruso said.

He also told a story of how his grandfather was a coal miner. He lived in a coal mining town outside of Union, Pennsylvania. Caruso’s father was born in a coal mining town.

“I have a deep respect, and being raised by my grandfather and my father, it gives me the roots on why we want to take care of people who work hard and give back to their company and give back to the community,” Caruso said. “And that’s the basis for the project.”

Wednesday’s meeting lasted for about four hours, and there were speakers in support and in opposition to the project.

Austin Herlihy, a commercial real estate broker and residential property owner, said he supports the affordable housing for employees at the Miramar. He said there is a housing crisis. Communities have not built enough housing, so the State of California has pushed cities and counties to approve more housing.

“I believe these plans are both practical and thoughtful,” Herlihy said. “This housing has three times the affordable-housing units required by the state.”

He defended the need for the commercial shops.

“Building affordable housing isn’t affordable,” Herlihy said. “It costs the same amount of money as market-rate housing. There has to be some economic component to make the project work.”

He said employers building housing is the wave of the future to help solve the housing crisis.

Resident Paige Robinson isn’t buying it. She testified that there needs to be an independent traffic and parking analysis. She also said Caruso should swap the housing and move it to the other side near the All Saints church, which would free up the mountain views. Then, families who work and live there would be more integrated into the resort lifestyle.

“We live directly across from the new project on Eucalyptus Lane,” Robinson said. “Those children would be welcome to recreate in our swimming pool.”

Speaking to the planning commissioners, for a moment she turned away and looked at Caruso, who was sitting in the front row, and said, “I hope they will be able to recreate in the Miramar swimming pool.”