In an effort to fix the slow and often painful process of developing housing, the City of Santa Barbara is working on a new program designed to incentivize and streamline housing projects while meeting climate and energy goals.

On Monday, the City Council and Planning Commission held a joint meeting to review the city’s proposed five-year “better buildings” pilot program.

“We know that the land development process in Santa Barbara is slowed by complexity, uncertainty and risk,” said Alelia Parenteau, acting deputy city administrator, “and this makes development projects very challenging to execute.”

In the past five years, 248 units were built in Santa Barbara across 10 projects, which is far below what the city is supposed to have under its regional-housing-needs allocation goal, Parenteau said.

Almost all of those were developed under the state’s density-bonus law.

Allison DeBusk, community development director, said the program is meant to complement the state density-bonus law, which outlines the amount of affordability that developers need to provide in exchange for high-density projects, leaving the city with little control.

Projects such as the proposed eight-story development behind the Mission are using state density-bonus law to supersede local restrictions.

Parenteau said city officials know that developers are frustrated with the review process and need clear pathways to execute projects. The proposed program is meant to streamline affordable developments while meeting climate goals without increasing construction costs. 

The proposed pilot program would use a point-based system in which developers would earn points if their project has energy-related enhancements, such as an all-electric building, using sustainable materials, or if the project includes affordable housing or mobility improvements such as bike parking.

Developers could then use the points to buy incentives such as unlimited density, reduced open-yard requirements, reduced vehicle parking and modified height limits.

Councilwoman Wendy Santamaria expressed concern that the streamlined housing projects wouldn’t actually be affordable for workers who are commuting from out of town and can’t afford to live in the city.

“If we have that as a north star, how do we get the employees that are always commuting to be able to live here, the people that keep the city running?” Santamaria asked.

“I think that could be a good way to center us on what it is that we need so that we don’t accidentally end up creating really green and beautiful buildings that ultimately are too expensive for our workforce to afford.”

She also suggested revisions to the point system to better incentivize affordable developments, not just energy-efficient buildings.

Councilwoman Meagan Harmon said she shares the concerns about affordability, but that adding more restrictions would risk developers not wanting to use the program.

“I just want to make sure that we don’t totally miss the forest for the trees when we put together this program,” Harmon said. “Affordability is key, but so, too, is ensuring that we don’t get a hotel downtown when we could get housing.

“What’s worse than no affordability? To me, it’s a hotel.”

The program is starting in the downtown business area because the regulations there are less restrictive than other parts of the city, according to city staff. It also allows the city to test out the program in a focused area.

“The goal, if this is successful, we would love to expand it citywide or to key areas,” DeBusk said. 

The council and Planning Commission were supportive of the program but had concerns about how it would interact with state density-bonus law, and questioned whether the program should go beyond the downtown area.

“State-density bonus law applies citywide, and if we’re trying to provide an alternative pathway to it, I think we could have avoided some headaches in certain places in the city, not just downtown, if developers had chosen our local program,” Commissioner Benjamin Peterson said.

Commissioner John Baucke said the program needs to be effective, or the city risks losing control over development.

“We need this to be something that actually works and is feasible — a better path for a developer to take than the state density bonus,” Baucke said. “Because the state density-bonus does not have a height limit, and you can waive a lot of things, even things that are important to our community can be waived through state density bonus.”

The project is in the early stages, and many details still need to be ironed out.

After taking in Planning Commission and City Council feedback, city staff will conduct more stakeholder outreach before returning to the commission with a draft ordinance.

It then would go to the council’s Ordinance Committee before going to the full City Council.