For years, South Valley Community Church in Gilroy fought for
the right to develop 15 homes along Hecker Pass Highway to finance
the construction of a new church, private school and sports
field.
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For years, South Valley Community Church in Gilroy fought for the right to develop 15 homes along Hecker Pass Highway to finance the construction of a new church, private school and sports field.
Now a church representative says a deal is in place to sell at least part of the land to local developers, and whether the church, school and sports fields get built is up in the air pending a thorough financial review.
Bob Costamagna, church elder and spokesman, said developers James Suner and Bob Dyer had agreed to buy the six acres where the 15 homes were set to be built, and the church now would “work with them to determine what our options are for the rest of the property.”
Suner confirmed the agreement Thursday.
“We’re certainly doing that on the 15 lots, and that was the plan was from Day 1,” Suner, who has shepherded the plan project through the city process for the last year, said.
The church had tried for years to entice developers, Costamagna said, but opportunities disappeared quickly. The first intent is to develop the property, but the land may be prepped for sale, he said.
“We are in kind of a review process of the best way to grow,” Costamagna said. “We’ve got to look at our financial capability.”
The church had chugged along with plans to build the homes on a nearly 27-acre plot west of Third Street on Santa Teresa Boulevard. Plans were approved by a 5-2 Gilroy City Council vote in July 2009. In the 1.5 years prior to the approval, the church spent nearly $175,000 on paperwork and planning fees, Costamagna said, and the church has incurred a hefty debt because the land has gone undeveloped since the purchase roughly a decade ago.
“The debt reduction is the primary goal,” he said.
Costamagna declined to comment on how much debt the church was facing.
“It’s an example of the way the times have been,” said Mayor Al Pinheiro, who cast votes in favor of the project in 2007 and 2009.
The project’s tentative map was approved by the City of Gilroy Planning Commission April 7 and will go before the Council during a public hearing May 2.
Costamagna called the planning commission approval a “good first step” toward remedying the church’s debts.
“This is good news for us,” Costamagna said. “It helps reduce the burden. It doesn’t remove the burden, but it reduces it.”
Councilman Bob Dillon, who has also voted in favor of the project, said he wasn’t shocked to hear of the church’s financial issues.
“I think they’re all taking a big bath in this economy,” he said. “Now they are going to sell the houses for a lot less than they previously thought. It doesn’t surprise me.”
The project has been the subject of focused debate over the past several years.
In 2007, the Council voted unanimously to approve the project concept even though it would push the city past a self-imposed growth limit. Council members said there was precedent for going above the growth cap for certain projects, as the previous Council granted the Gilroy Unified School District 99 housing units in 2006, exceeding the limit so the district could finance two new schools.
Costamagna and church senior pastor Eric Smith said the Hecker Pass Specific Plan called for a new church and private school for 650 students, and the proposed 15-unit development was vital for funding it.
The Council decided to grant the church’s request through a separate small project exemption that involved amending the city’s General Plan and altering the Hecker Pass Specific Plan, which had been zoned for schools, religious, recreation and other social centers.
The General Plan specifically addresses Hecker Pass, and calls on the city to “protect and enhance the unique qualities and character” of the area as the city’s western entry point and as a valued scenic resource. The proposed homes would sit 115 feet back from the street.
Former Councilman Roland Velasco said during the Nov. 19, 2007 meeting that exceeding the growth limit might not have been in the best interest of the city, but decided the church would better the community overall.
“Too often we don’t recognize the value churches bring to our city,” Velasco said.
He said the church would solidify a sense of community, educate residents with its school and pay impact fees to the GUSD.
He added, “Just like a realtor might promote the schools in town, I think they also go out of their way to reference the churches in their town.”
But Pinheiro said Thursday the Council did not make an exception just because the proposal came from a church.
“I don’t think it was because it was a church asking for it. It was for the vision of the city,” Pinheiro said.
Dillon agreed. “I thought it was a good project then, I think it’s a good project now.”
He said it wasn’t the city’s responsibility to make sure projects go as predicted.
“It’s not the city’s job to make a development pencil out,” Dillon said. “It’s to make sure it meets approvals. This project has met approvals.”
The property is located roughly a quarter-mile from South Valley Community Church’s Kelton Drive location off First Street. The church has been in Gilroy for 26 years.
