City of Capitola
City Council
Thursday, September 24, 2026, 6:00 PM
How to take part
Show up: Thursday, September 24, 2026 at 6:00 PM, City Council Chambers, 420 Capitola Avenue, Capitola. California's open-meetings law (the Brown Act) gives you the right to speak on agenda items. Remote-participation links, when offered, are on the agenda.
Write in: citycouncil@cityofcapitola.gov (from the address this meeting's agenda gives for public comment)
Deadline: Correspondence received before 5:00 p.m. on the Wednesday before a Council meeting is distributed to Councilmembers ahead of the meeting. Later submissions may not be reviewed in time.
Emailed comments are included in the record for the meeting.
What's being decided
- Major· Planning & development, Housing, Jobs & local economy· Consent agendaFinal vote on zoning changes covering community benefit incentives, ADUs and body art studios
This is the final vote (second reading) on a package of zoning code changes the Council introduced earlier in September 2026. It rewrites Chapter 17.88, the rules that let developers on 41st Avenue and Capitola Road between Clares Street and 42nd Avenue build taller and bigger in exchange for "community benefits," and moves the separate Capitola Village hotel incentives (for the former Capitola Theater site) into a new Chapter 17.90 with no changes to those standards. It also updates the city's accessory dwelling unit rules to match two 2025 state laws, and repeals the city's 1962 ban on tattoo businesses, replacing it with zoning rules that would allow up to three "body art studios" citywide. A yes vote adopts the ordinance; it takes effect 30 days later outside the coastal zone, and inside the coastal zone only after the California Coastal Commission certifies it.
- Major· Housing, Taxes, fees & budget, Planning & developmentHearing and vote on bond financing for Capitola Manor affordable housing at 1098 38th Avenue
MidPen Housing Corporation, through MP Rail Trail Associates, L.P., wants to use tax-exempt bonds to help pay for a 52-unit rental housing project at 1098 38th Avenue in Capitola, known as Capitola Manor Apartments. The bonds would be issued by the California Municipal Finance Authority, not the City, in an amount not to exceed $40,000,000, and would cover buying, building, improving and equipping the project. Federal tax law requires the elected body where the project sits to hold a public hearing and then approve the financing plan. A yes vote gives that federal approval so the bonds can be tax-exempt; it does not commit Capitola to repay anything.
- Major· Transportation & traffic, Taxes, fees & budgetParking meter rate increases proposed for City Hall lots, Village and Cliff Drive areas
Capitola would raise its parking meter rates: from $2.00 to $2.50 per hour in Capitola Village and the Cliff Drive area, and from $1.00 to $1.25 per hour in the Upper and Lower City Hall Parking Lots at 426 Capitola Avenue. A yes vote would approve a Coastal Development Permit for the change and give first reading to an ordinance amending Municipal Code Section 10.38.010, with the new rates taking effect January 1, 2027. The three-hour Village limit and the 8:00 a.m. to 8:00 p.m. enforcement hours in the City lots would stay the same. The ordinance would also correct the name of the Zone B lots from 'Upper and Lower Pacific Cove Parking Lots' to 'Upper and Lower City Hall Parking Lots.'
- Major· Housing, Taxes, fees & budgetCity may create down payment help for buyers of affordable Capitola homes
City staff are asking the Council for permission to build a down payment assistance program for people buying affordable homes in Capitola. The city would lend up to $25,000 per qualifying household toward the down payment on a home that carries a city-approved affordability restriction; the loan would be secured by a deed of trust and repaid when the home is sold, refinanced or transferred, so the money can be lent again. A yes vote authorizes staff to write the program rules — income limits, loan terms, resale and repayment provisions — with the City Attorney approving the final format. Market-rate homes without affordability restrictions would not qualify.
- Notable· Planning & development, Parks, arts & recreation, Environment & climate· Consent agendaVacating part of Escalona Drive right-of-way to create a parcel with public easements
The City owns an unimproved strip of street right-of-way at the end of Escalona Drive on Depot Hill, between private properties including the Monarch Cove property. It is not used for cars, but an informal footpath crosses it to an ocean overlook. A yes vote would formally vacate (give up) that street right-of-way, turn the land into a single legal parcel, and keep two permanent easements on it — one guaranteeing public pedestrian access along the path to the overlook, and one keeping most of the parcel as open space with very limited development. The vote would also approve a Coastal Development Permit for creating the parcel and let the City Manager sign and record the necessary deeds and maps.
- Notable· Parks, arts & recreation, Government & transparencyChanges proposed to rules for reserving city parks for exclusive use
Capitola's City Council is asked to update Administrative Policy V-21, the rulebook that says which parts of city parks people can reserve for private use like birthday parties and graduations. The update removes two areas at Jade Street Park from the reservable list because the new Treasure Cove Playground was built next to them, and it lists The Park at Rispin Mansion as not reservable because of limited parking, access and space. A yes vote adopts the amended policy and lets the City Manager or a designee run the program, including temporarily changing which areas are available during construction, maintenance, environmental problems or safety concerns.
- Notable· Taxes, fees & budget, Government & transparencyCouncil decides whether to formally oppose state Proposition 43
The City Council is asked to decide whether to take a formal position against California Proposition 43, a statewide constitutional amendment on the November 3, 2026 ballot. Proposition 43 would require any local special tax — a tax dedicated to a specific purpose, such as fire service or parks — to get a two-thirds vote to pass, even when residents themselves put the measure on the ballot through a citizen initiative; today those citizen-initiated special taxes only need a simple majority. A yes vote on this agenda item would adopt a resolution opposing Proposition 43 and direct staff to email it to the League of California Cities. The Council's other listed option is to take no formal position.