Near Winchester Avenue and Stevens Creek Boulevard in Santa Clara sits a lonely 6-acre parcel of land, originally part of of a University of California agricultural research center that shut down in 2003. The land was set aside for housing development, and in 2015, Santa Claraâs city council selected a developer and approved a $15 million subsidy. The project was supposed to break ground in January 2017. But more than a year later, the lot sits empty, used for overflow parking from the nearby Westfield Valley Fair mall.
Shortly after the research center went dark, the city of Santa Clara bought the parcel at 90 N. Winchester Blvd. from the state for $11.5 million with the intent of developing it into low-income housing. In 2005, SummerHill Homes bought 11 of the acres and developed it into market-rate units, but the affordable housing element sputtered.
When Kirk Vartan, a San Jose resident and Santa Clara business owner, moved into the area, he immediately wondered what the deal was with the fence around the remaining 6-acre parcel. Since then he has been working with the city and developers to bring high-density neighborhood with an agricultural element to it, known as an âagrihood.â
By the end of 2014, community members had organized behind Vartan and began lobbying the city. The City Council began talks about revamping the site, complete with a community garden, a farmers market and a community center. As part of the sale, the site carried with it a contingency: a percentage of the housing must be âaffordable.â That is, below market prices.
Even though San Jose-based developer The Core Companies was supposed to break ground at the outset of 2017, the company still lacks a development agreement more than two years after it received the green light. Its exclusive negotiating rights are up for renewal in April for the second time since state Sen. Bob Wieckowski (D-Fremont) obtained passage of Senate Bill 680, a piece of single-purpose legislation to permit the cityâs land sale for the development.
One week after the governor signed the bill, Core gave $4,200 to Wieckowskiâs re-election campaign. Legislators are exempt fromÂ the Fair Political Practices Commissionâs Pay-to-Play Contribution Restrictions, which prohibit officials from accepting campaign donations of more than $250 for three months following a decision affecting an interested party.
Santa Clara council members have regularly decried the lack of housing in the area, specifically so-called affordable housing. So, when the project went out to bid in 2015, all the contenders proposed high-density developments that would put more than 100 apartments on the site. Though Santa Clara-based ROEM Corp. offered the most money for the landâwhich would have resulted in nearly $6 million going into the cityâs general fundâthe council went with Coreâs proposal, which required a $3.8 million subsidy.
Assistant City Manager Ruth Shikada said it was likely that her office would recommend a renewal of Coreâs exclusive negotiating rights when it came before the council.
Councilwoman Teresa OâNeill said that choosing Core had a lot to do with the companyâs reputation for community outreach. However, that community outreach, OâNeill said, is largely the reason the project is behind schedule. She said she has been kept mostly in the dark about how the project is progressing.
âI would like things to move faster,â she said. âI am a little frustrated â¦ I almost get the sense that there are some folks â¦ [and] neighbors who would rather not see [the site used for] affordable housing.â
OâNeill pointed to the high turnover at City Hall since Mayor Jamie Matthews abruptly resigned in early 2016âa new city manager, city attorney, finance director, new council members and the city clerkâs resignation just last monthâas a possible explanation.
âUnfortunately, our staff got totally overwhelmed on a number of fronts,â she said. âThis is just one of many things that we are having to catch up on.â
Despite Coreâs touted community skills, the councilâat Vartanâs urgingâopted to bring in New York-based nonprofit Project for Public Spaces to help with community outreach.
Vince Cantore, senior development manager at Core, said his company has a zoning application and confirmed the idea that public input and the involvement of Project for Public Spaces delayed the timeline.
âThe placemaking effort set the project back in terms of schedule,â he said. âWe get and respect the vision and passion and dedication they have brought to the project â¦ Anybody that is aware of this project is going to know the intricacies. We have done a pretty good job of listening to key stakeholders.â
Cantore said one of the main changes to the development is the location of the farm, which will now face Winchester Boulevard. Although he said Core wonât be ready to break ground until spring of 2019, he believes the project is âin a stronger place than it was a year ago.â Once construction begins, Cantore said, the construction will likely take between two and three years.
As of its last design, Coreâs project boasts 1.5 acres of farm land, 165 âaffordableâ senior apartments and 194 market-rate homes, including 34 for-sale townhomes.
Still, amid the delay, Vartan remains optimistic about the projectâs potential. He said part of the delay has been because the concept was not âfully fleshed outâ before the wheels were in motion, leaving a need for changes.
âHas it taken too long? Hell yeah â¦ but it has taken too long because we havenât done the work,â he said. âIt is better to aim high and miss than aim low and hit.â
While the opinion that public input has caused delays seems to be the prevailing one in Santa Clara, other projects that Core is involved with have run into similar issues.
The Park Avenue Senior Apartments, which is owned by the Santa Clara County Housing Authority and getting built by The Core Companies, has also faced significant slowdowns. Although, a Nov. 30 memo from housing authority assistant director Flaherty Ward, paints Pacific Gas & Electric issues as the culprit.
The installation of a new gas main took nine months and, according to the memo, was a result of âseveral issues including incorrect PG&E drawings, PG&E material shortages, identification of PG&E approved subcontractor.â The gas pipe was completed in September 2017. Further, Core discovered in October that a supposedly abandoned transformer was still live. Since, PG&E crews were dispatched to the North Bay to mitigate wildfire damage, they were unavailable until January.
All this amounted to a 12- to 15-month delay and $1.5 to $3 million in added costs that Core will have to bear for the public housing project. In addition to that price hike, two change orders amounting to an additional $130,857 have driven up the price of the project to $34.4 million.
For what itâs worth, Ward noted that Core played a different role in the Park Avenue apartments than with the agrihoodâthe company is the building contractor for the former and the lead developer for the latter.
The slowdowns on the Santa Clara project have significantly driven up the cost, too, But Cantore said the agrihood being so âhigh-profileâ makes those expenses bearable.
Ultimately, Vartan thinks the postponement is a small price to pay for the benefit a farm at one of the valleyâs busiest commercial intersections would bring to Santa Clara.
âA two- to three-year delay seems like forever in current perspective and dollars, but in the context of a generational time horizon (that cities have), itâs really not that long,â he wrote in an email.
As for now, the city has received the revised plans from Core and intends to hold another community meeting sometime later this spring.
This article has been updated. Due to an editorâs mistake, the printed version of this article raised the possibility of aÂ California Government Code Section 84308 violation by Sen. Wieckowski. Legislators, however, are exempt from the pay-to-play restriction, and this digital version has been corrected. âEditor