Legal battle over Nipomo project is over. But was it a settlement or a shakedown? | Opinion

The lawsuit filed by opponents of the large Dana Reserve project in Nipomo has been settled, clearing the way for construction to finally begin when —and if — the revised plan is approved by San Luis Obispo County.

Unfortunately, this feels more like a shakedown than a settlement.

As a term of the agreement, the number of deed-restricted, affordable apartments has been cut in half — from 156 to 78 — and other types of multifamily units have been reduced by 10%.

Also, 100 accessory dwelling units — added at the urging of the county Planning Commission — are gone, though homebuyers will have the option of adding them later.

And it isn’t just low-income families who are losing out. The delay related to the lawsuit will cause market-rate housing prices to escalate for middle-income families hoping for a shot at home ownership.

A dilemma for county supervisors

The outcome is ironic, given that opponents of the project — including some who went on to sue developer Nick Tompkins — argued that there were not enough affordable units to justify removing roughly 3,000 oak trees.

Tompkins ultimately agreed to remove an entire section of affordable units, which will save 195 oak trees out of the 3,000.

That hardly seems like a fair trade-off — sacrificing 78 units to save 195 oak trees — and it’s one that should trouble county officials, especially supervisors who have routinely promised voters that they will make affordable housing a top priority.

While other concerns about the project were raised as well — including traffic, water and habitat loss — the ratio of affordable housing loomed large. It was one of the major reasons that Supervisors Jimmy Paulding and Bruce Gibson voted against the project, which still squeaked by on a 3-2 vote.

Paulding, who represents Nipomo, wrote in a Tribune viewpoint that “a mere 30%” of the units would be the type of low- and moderate-income housing that meets state affordability standards.

Now that further revisions have substantially reduced the project’s low-income housing, Paulding and Gibson can’t very well turn around and approve it — not if they want to retain their credibility.

With the project in his district, Paulding is in a particularly tough spot. He has tried to appease both sides by insisting that he’s not opposed to developing the site — rather, he’s looking for a smaller project that would be a “win-win” — but there is no way to spin this into anything but a major loss of low-income housing in a county that consistently ranks as one of the least affordable in the nation.

Without the support of Paulding and Gibson, the three remaining supervisors will have to hold their noses and vote for it anyway.

Either way, this points to the failure of the county’s elected leaders to make good on their promises to deal with the county’s housing affordability crisis. (According to data presented to the Board of Supervisors in April, only seven very-low-income units have been issued permits in the county’s unincorporated areas since 1994, leaving the county far short of meeting its goal of 801 very-low-income units.)

It also highlights the lopsided power the legal system bestows on neighbors who are determined to scuttle projects they find objectionable, no matter the consequences.

Down payment assistance, day care centers survive

The lawsuit placed Tompkins in a no-win position. He could go to trial, but even if he won, an appeal could have dragged it out indefinitely. All the while, building costs would rise.

The project will retain several of the amenities that make this a family-friendly project, including three day care centers in the multi-family housing areas. Land will be set aside for a South County campus of Cuesta College, a fire station and a health care facility. There also will be shopping on-site; the California Fresh grocery chain has already committed to opening a location there.

To help with affordability, the developer will contribute $3.2 million to a down-payment loan program for first-time homebuyers. Also, employees of the Lucia Mar school district will be given priority for the deed-restricted housing.

During the lawsuit negotiations, Tompkins also agreed to provide funding to the California Native Plant Society for preservation of manzanita, and an undisclosed sum will go to the Nipomo Action Committee for local community projects.

Also, there will be a larger buffer zone between existing residences and the new housing, and if the county agrees, a portion of Hetrick Avenue will be closed to traffic — something current residents have been pushing for but the county has resisted.

Fewer rungs on the housing ladder

The project will require as much as $40 million in new infrastructure. To make it pencil out, the development originally included 418 luxury units — a major sticking point with opponents.

“We simply reject the proposition that ripping out an old oak forest in order to build more luxury homes will meaningfully address our affordable housing shortage,” Nipomo Action Committee leader Alison Martinez said in a statement issued when the lawsuit was filed.

Yet compared to other large residential developments in the unincorporated South County — notably the Trilogy, Cypress Ridge and Black Lake golf course communities — Dana Reserve was designed to include a far greater mix of housing types at a range of price points.

When the project was approved in the spring of 2024, it was anticipated that — with the exception of the high-end units — houses would range between $475,000 and $725,000, in 2024 dollars.

Given the delay caused by the lawsuit and the need to go back through the approval process, prices are expected to be substantially higher.

Still, the project will provide some much-needed housing — “a full ladder of housing types to help address the region’s housing shortage,” to quote the statement that announced the settlement.

Unfortunately, the low end of that ladder will be missing some rungs.

This story was originally published June 1, 2025 at 5:00 AM.