City Council

This is the city's end-of-year cleanup of its budget for fiscal year 2026, which has already ended. Finance staff reviewed where departments and projects spent more or less than the council had approved, and this resolution formally moves money between funds and projects to match what actually happened. The largest pieces include a $1,218,000 General Fund transfer to the Municipal Wharf fund and $1,431,989 to the Parking fund to cover spending that exceeded those funds' revenues, $1,584,070 more for outside legal services in one General Fund department, and the shifting of big street projects (such as Downtown Intersection Improvements and Bay Drive Protected Bike Lanes) out of the Gasoline Tax fund into the General Capital Improvement fund. A yes vote adopts all of these adjustments; staff say the changes are one-time and do not create ongoing spending commitments.

The city switched its financial software from Tyler EDEN to Workday, and Workday uses a different account numbering system. This item would re-state the already-adopted Fiscal Year 2027 budget in the new Workday coding structure, with the same total dollar amounts the Council approved in June. It would also update five Council financial policies and cancel two others that have been folded into the updated ones. Notable policy changes include sending 5% of any General Fund surplus to the Economic Development Trust Fund and lowering the surplus transfer to capital projects from 20% to 15%, and changing the Economic Development Trust Fund's funding to a flat 7% of hotel tax revenue.

City rules currently require that any residential project with 20 or more units built within a half mile of public transit sign a contract with Santa Cruz METRO to give all residents unlimited local transit passes. This ordinance would let a public school district that is the applicant for such a project choose a different path instead: propose its own Transportation Demand Management Plan (a package of measures meant to cut car trips and miles driven), which the Public Works Director may approve at their discretion. A yes vote gives the ordinance its second and final adoption, after the Council passed it for publication on October 13, 2026 by a 7-0 vote.

This is the final vote on Ordinance No. 2026-18, which changes the city's sewer rules in Municipal Code Chapter 16.12. It lets a property owner or developer pay for and build sewer improvements — such as sewer mains, lines, laterals, interceptor sewers and pump stations — and then sign a "reimbursement agreement" with the city so later property owners who benefit from that same sewer work pay back a share of the cost. A yes vote adopts the ordinance, which takes effect 30 days after final adoption; the council already approved it for publication on October 13, 2026, by a 6-0 vote with Vice Mayor Kalantari-Johnson absent.

The city wants to re-adopt a rule it already passed in 2025: any commercial use permit that was active on January 1, 2019 or approved any time up through December 31, 2026 would automatically stay valid until January 1, 2030, unless the Council extends it further. Normally a permit dies 36 months after approval if it is not used, or six months after the permitted business stops operating, which forces the next business in that space to repeat the full discretionary permit process. The Council first approved this as Ordinance 2025-18 in August and September 2025, but staff later found the public notice did not meet the stricter requirements for changes to the city's Local Coastal Program, so that ordinance could not be sent to the California Coastal Commission. A yes vote is the first reading of a new ordinance that repeals Ordinance 2025-18 and re-enacts the same change with proper notice, plus a finding that the change is exempt from environmental review.

The council would take the first vote on changes to the city's "Vibrancy Ordinance" (Municipal Code Chapter 5.84), the rules for empty ground-floor storefronts that began as a Pacific Avenue pilot in June 2025. The changes would expand the rules in stages — full enforcement across the Downtown Plan Area starting January 1, 2027, with maintenance standards and optional window coverings citywide, and full citywide enforcement on January 1, 2028 only after a council review in Fall 2027. The council would also raise the annual registration fee for storefronts vacant two years or more from $1,621.89 to $4,000 (adjusted each January 1 by inflation starting in 2028), waive up to $14,000 each in planning and building permit fees for the next 20 new businesses citywide, and move $76,000 from the Economic Development Trust Fund into a grant program that reimburses up to $2,000 per storefront for window coverings. A yes vote introduces the ordinance for publication, with final adoption at a later meeting.

City planning staff are giving the Council a progress update on a project to write voluntary design guidelines for larger apartment and mixed-use buildings in Santa Cruz. Since March 2026 staff have held a roundtable with architects and builders, a July 23 community meeting hosted by a Planning Commission special meeting, and an August online survey that drew 753 responses; a draft guidelines document is now being written. A yes vote simply accepts the informational report and gives staff feedback — it does not adopt any guidelines or change any rules. Staff plan to take a draft to the Architectural Review Committee in late 2026 or early 2027, hold focus groups with groups that were underrepresented in the survey, and then return to the Planning Commission and Council.