Plans for the McKay Ranch Subdivision include up to 320 residential units, including up to 172 multi-family units, along with 22,000 square feet of commercial development on a total of about 81 acres in Cutten. | File image via County of Humboldt.



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PREVIOUSLY

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Humboldt County’s most significant unbuilt private housing development project could take a major step forward at tonight’s meeting of the Humboldt Community Services District’s (HCSD) Board of Directors, as that body considers a request to annex the project site into its service boundaries.

One of those directors, Heidi Benzonelli, is encouraging residents of the district to attend the meeting and have their voices heard.

“At times like this, when such an important decision is going to be made about the future of our community, that’s when I’d love to hear your personal voices,” Benzonelli said. “I can carry the message so far but there are times that we just need people to show up to meetings to tell us how you feel, and tonight is the night.”

Last time we checked in on the North McKay Ranch Subdivision, the major mixed-use development in Cutten proposed by local developer Kurt Kramer, the project appeared to have reached an impasse. 

The plans, which call for up to 320 residential units and 22,000 square feet of commercial space to be built in phases over many years, hinge on getting the underlying parcels annexed into the HCSD. Without annexation, the project won’t have water, wastewater or street lighting services.

But as of a few months ago, that prospect had been stymied by a three-way disagreement over who should bear the infrastructure development costs.

The HCSD, which has already invested tens of millions of dollars of ratepayer money on infrastructure to accommodate population growth that never materialized, doesn’t want to carry the financial burden on its own.

“Given the District’s limited resources, we can only focus on pursuing grants that help reduce the cost of providing services to our existing ratepayers,” General Manager Terrence “TK” Williams said at the time.

So staff and board members tried negotiating with Humboldt County in hopes of reaching a deal to share incremental property tax revenues. But the county wasn’t particularly interested in sharing. A spokesperson told the Outpost in January that counties don’t typically divert tax revenues to community services districts unless the CSD assumes responsibility for some county-supplied services. That’s not the case here.

As shown in the map below, the North McKay Ranch Subdivision site is located just outside of the district’s service boundaries (shown in red) but within its sphere of influence (in yellow). (Zoom in to see the the project site itself, shown in black.) 

In total, all phases of construction call for 50 small-lot single family units, 96 standard-lot single family units and 174 multi-family units. Another 34 accessory dwelling units (ADUs) are estimated to be developed at full build-out, according to the HCSD plan for services.

Reached by phone on Monday, Williams said the HCSD is not trying to be obstructionist on this project. Rather, staff and the board just don’t want to saddle current ratepayers with the cost of new development.

“I guarantee nobody’s gonna build over there until somebody builds a [water] tank,” he said. “If a tank is built, that opens capacity for building. It’s a matter of who’s gonna pay for the tank.”

Up in McKinleyville, the community services district is building a new 4.5-million-gallon water storage tank thanks largely to a $5 million FEMA/CalOES Hazard Mitigation Grant. But unlike MCSD, HCSD has sufficient fire-flow capacity to serve its existing ratepayers, so the district wouldn’t qualify for such hazard mitigation grants, Williams said.

With that option out, an ad hoc committee comprising board members Benzonelli and Michael Hansen has been meeting with Kramer in search of a solution.

“We ironed out some clauses to include [regarding] plans for service,” Williams said. “With that, the ad hoc committee feels pretty confident that the district is protected from continuing to pay for growth in the community.”

Those clauses, included in a staff report for tonight’s meeting,  say that funding for a new 250,000-gallon water storage tank — and for upsizing the district’s water main on Walnut Drive, between Holly Street and Cypress Avenue — will be supplied by the developer (Kramer) “or other sources” but definitely not by the district. That will be a condition of approval. 

A new sewer lift station will also be needed at the northeastern portion of the project site which. Kramer is planning to do that, as well. The project applicant is technically Fairhaven Cottages, LLC, a subsidiary of Kramer Properties, Inc. Kramer has already paid for an Environmental Impact Report and received project approval from the Humboldt County Planning Commission and Board of Supervisors.

If the HCSD board elects to approve annexation, the move will also require approval from the Humboldt Local Agency Formation Commission (LAFCo). 

A call to Kramer for this story was not immediately returned. In previous interviews he has argued that the seemingly unending succession of impediments to this project show that the state and local governments can’t be serious about the supposed need for new housing construction.

Benzonelli said that she takes her responsibility as a representative of the public seriously, and when she’s gone campaigning door-to-door in the district’s various neighborhoods — including Cutten, Ridgewood, Myrtletown, Freshwater and more — she has heard a variety of strongly held opinions about the North McKay Ranch project. But people hardly ever attend the HCSD board meetings.

“At some point we need you to speak in the public forum,” Benzonelli said. She wanted to issue a call to all residents with an opinion on the project, not just its critics and not just its opponents — “just real, true, genuine community ideas and concerns.” 

She wants residents to weigh in on the question of what they want their community to be like in a perfect world.

“And this is our opportunity to hear that: tonight, 5 o’clock. “

HCSD meetings can be attended in person at the district offices, 5055 Walnut Drive in Eureka. You can also join via Zoom by clicking here, entering Meeting ID 388 963 6754 and Passcode 202520.

And if you don’t Zoom, you can join via telephone only by calling 1-669-900-9128.

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DOCUMENT: HCSD meeting agenda and board packet for April 8, 2025