Week in Review : Santa Paula : City Agrees to Repay Loan to Developer

Stung by public criticism, the Santa Paula City Council voted unanimously last week to pay back a $96,000 loan from an Orange County developer. The loan had partly financed a study of development possibilities for 500 acres of farmland, including a 30-acre parcel on which the developer holds an option.

Slow-growth advocates argued that the loan gave developer Harry Tancredi too much leverage over the council and its planning decisions. Said Jim Procter, a leader of Concerned Citizens for Responsible Development: “I was very concerned about Mr. Tancredi playing banker for the city.”

Council members explained that their decision to repay the loan will deflect criticism that they have been swayed by the money. “I felt it was the right thing to do,” said council member John Melton, the only opponent of the council’s decision to accept up to $187,000 in loans from Tancredi.

The $96,000-loan that the city will repay had financed the first half of the study of the 500-acre agricultural area. Along with agreeing to repay the money, the council delayed the second half of the study until a general plan review is completed.

Despite Tancredi’s role in financing it, some citizens were pleased with the results of the study’s first phase. The study, by a Newport Beach-based consulting firm, recommends replacing citrus groves and homes with stores, offices and large housing tracts containing up to 1,350 homes.

Proponents said the plan would give the city more affordable housing and more customers for local businesses. “We need a mixed housing stock,” said Jesse Ornelas, who suggested that at least one quarter of the homes be set aside for poor families.

Others, however, were critical of the proposal, saying it would destroy most of the working citrus groves west of the city.

Tancredi said the council’s decision has not killed his hopes of building 126 homes on the site. He pointed out that officials are still awaiting the results of a general plan review and a study that will outline what kind of housing is needed in the city. That study is expected to be completed in the next two months.