Scotts Valley Council questions economic impact of county’s vacation housing ordinance

By Kimberly White — Santa Cruz Sentinel
Posted: 10/20/2010 09:54:23 PM PDT

SCOTTS VALLEY – The Scotts Valley City Council voted to draft a letter to the Board of Supervisors Wednesday, asking the county to study the economic impact a proposed vacation housing ordinance would have on Scotts Valley.

That decision followed a more than hour-long discussion – including about 40 minutes of public comments from residents in Aptos, Soquel, Live Oak and surrounding communities who touched on everything from the erosion of private property rights to falling property values to the perception that the county is rushing to pass the ordinance.

Last month, the Housing Advisory Committee rejected sending the ordinance to the Planning Commission, saying it was too broad and poorly written. It would have capped the number of vacation rentals allowed in the county, limited the number of people who could stay in them, mandated operating permits and required inspections.

Live Oak resident Robert Morillo, who said his neighborhood is adversely affected by vacation rentals, denied the ordinance would have a significant impact on Scotts Valley and questioned why the council was spending its time discussing an issue outside of its jurisdiction.

But he was drowned out by others who said the ordinance would put in place so many regulations that they would no longer be able to draw income from them.

They also spoke about its potential impact on Scotts Valley, particularly the loss of revenue from people who stock up on supplies in stores
and dine in restaurants on their way to the beaches. Soquel resident Robert Vallerga, speaking on behalf of the Senior Coalition, said members are adamantly opposed to the entire ordinance and questioned why the county appears to rushing the ordinance toward a vote in November.

“We are not at all interested in modifications or smoothing it out to make it more palatable,” he said.

Gene Scothorn, vice chair of the Santa Cruz Republican Party, said any loss in county revenues as a result of the ordinance would result in losses in Scotts Valley, and warned of falling property values under an ordinance that tells property owners what they can and cannot do with their properties.

He also called the ordinance discriminatory, because it would exclude more than 800 residential properties in District 2 – which includes Aptos, La Selva Beach, Corralitos, Freedom and parts of Capitola and Watsonville – all of whose values would unfairly rise because of elimination of competition.

But Vice Mayor Dene Bustichi voted against the motion to draft the letter, saying that while he disagreed with the ordinance and predicted it would only hurt the county, Scotts Valley shouldn’t weigh in and tell the county what it should and shouldn’t be doing.

“I have concerns about jurisdictions passing resolutions because they can, but other than poking a stick in the eye of somebody, it really has no effect,” he said.

In other action, the council voted to approve using Redevelopment Agency funds to help Zero Motorcycles, which is based in Scotts Valley, expand manufacturing operations.

Under the agreement, Zero will receive $25,000 every year for the next three years provided it can show increased growth.

CEO Gene Banman told the council the company, which wants to close its overseas manufacturing operations, the company now employs 49, but expects that number to increase to 70 by 2012.