Since the 1970s, Santa Cruz has repeatedly tried to stimulate private redevelopment of the downtown between Laurel Street and the beach. The main tool available to the city for that purpose is zoning regulations.
The city website describes the next phase:
"The City of Santa Cruz is embarking on a planning study to consider future redevelopment of the area south of Laurel Street. City objectives include:
1. Providing additional affordable and market-rate housing in the downtown,
2. Creating public amenities like parks, public plazas, or better pedestrian infrastructure,
3. Improving the connection to the San Lorenzo River and beach areas,
4. Creating new economic opportunities for local businesses and workers,
5. Coordinate with the Santa Cruz Warriors to construct a new permanent arena."
The most controversial aspect of city proposals to emerge so far is a much taller height limit than anywhere else in the city. Descriptions include "15 and 17-story towers". For comparison, none of the buildings now under construction are more than 7 stories.
A couple of public meetings on this plan were held in late 2022, and an online community survey was announced on August 7 (link to the English-language version here). Response is requested by Sep. 1.
Update Mar. 1, 2024: The city has revised its height limit change down to 12 stories. Meanwhile, residents opposed to the height limit change qualified Measure M for the March 5, 2024 ballot.
On March 1, a story by Max Chun of Lookout Santa Cruz reports that the Golden State Warriors organization has looked at development feasibility and concluded that buildings taller than the existing Palomar (85 feet; 7-8 stories) do not pencil out for the south-of-Laurel area.