The long-running controversy over UCSC’s Student Housing West project resurfaces this week, with UCSC taking a partially revised proposal back to the Regents for the third time in four years—they meet on March 15 and 16.
The latest proposal does not change what is planned—17 acres of the iconic East Meadow will still be torn up, which has long been the focus of the controversy—but it changes the financing so construction can begin before pending litigation is concluded.
This is risky business and, therefore, not usually done. The project will still destroy 17 acres of the East Meadow, but the financing plan has changed radically. That radical change is a desperate attempt to get this project out of the box. The proposal, as written, is designed to obscure what they are proposing, but here are the key facts: Trying to launch this revenue-bond-financed project before pending litigation is dealt with is a departure from standard revenue bond practice. The bond buyers will not accept that litigation risk, so UCSC is proposing to load that risk onto all its on-campus students, potentially at a high cost. The students would be made to bear that risk to pull this project out of the mess campus administrators drove it into. If the financing proceeded as proposed, and the project was not completed because of litigation outcome or any other reason, the project itself did not produce rent revenue. All the other students on-campus would increase their rents substantially to repay those bonds. The core mistake that the administration made on what was previously a widely supported project was not corrected. Instead, the original project site was cut in half, which wasn’t necessary. They were trying to avoid a six-month delay, causing at least a six-year delay; they’ve been trying to correct that mistake ever since. That would take this project out of the East Meadow and be the best path forward. They are still not willing to admit that mistake and correct it.
The portion of the project in the East Meadow, they now estimate, has risen by roughly 60%. Still, we estimate approximately a 50% increase to around a billion dollars, and students would ultimately pay for it plus financing costs as rent. This project started as a winner and should have remained a winner. The five-and-a-half-year history of mistakes, misinformation and missing information continues. [Edited for clarity and length].
Paul Schoellhamer, on behalf of the East Meadow Action Committee
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