Jan. 27, 2005 - In a middle-of-the-night vote, the Santa Cruz City Council on Wednesday approved a $100 million hotel development, one critics claim could transform the town's funky beachfront into an upscale row of white linen eateries and trendy boutiques.

The 4-3 vote paves the way for Surf City's biggest building project since the University of California-Santa Cruz was constructed in the 1960s. It also marks a defining moment in Santa Cruz politics, crystalizing a new philosophy on the left-leaning council that must balance its traditional anti-growth bias with the grim reality that the city is hemorrhaging money.

Despite enormous pressure to delay a decision, the four-member majority decided to make the necessary zoning and general plan amendments needed to turn plans for the hotel, 23,000-square-foot conference center and six-level parking garage, into a reality.

The design -- which last week sparked more than eight hours of often emotional public testimony -- now moves to the state Coastal Commission, where the regional staff has criticized the project as "too bulky."

The latest plan calls for building a modern 270-room hotel on the site of the 163-room Coast Santa Cruz Hotel, an architectural atrocity still known around town by its old name, the Dream Inn. The city and its partner, Northwest Hospitality Group of Idaho, want to demolish the 10-story structure and two smaller buildings and replace them with four buildings -- the tallest of which will be eight stories. The city would float a $30 million bond to build the parking garage and conference center and lease them back to the hotel owners.

In 1974, environmentalists stopped a plan to erect such a hotel and convention center on Lighthouse Field in Santa Cruz -- a seminal moment in California's environmental movement. So the idea that the city will soon be fighting with the Coastal Commission's staff for a massive development is more than a little ironic.

Critics of the project argue that the project is too massive, will generate too much traffic and runs counter to the Santa Cruz Lifestyle -- laid-back and weird.

But the city council feels that the beach area is too seedy for a major tourist town -- and that the city is forfeiting big bucks to more upscale towns along the California coast. They say they have no desire to turn Santa Cruz into Carmel or even Monterey -- but that the city needs to get real about capturing tourist dollars year-round.

Give us a break, responded Mayor Mike Rotkin.

He noted that the project was projected to generate 1,400 car trips a day in a city that attracts 50,000 visitors on an average summer weekend and 100,000 visitors on the Fourth of July.

The powerful 12-member Coastal Commission has final say over the project's design and size. And the Sierra Club and other environmental groups will undoubtedly join forces to lobby the commission to squash the project.

"This process is a long way from over," said Santa Cruz County Supervisor Mardi Wormhoudt, who represents most of Santa Cruz. "It's one step in a long and complicated dance."

But some project supporters were ecstatic. They praised two council newcomers, Ryan Coonerty and Tony Madrigal, for voting with the majority and spurning the suggestion of Councilwoman Emily Reilly to delay a vote for six weeks for more public comment.

"That's just a way to kill it," said former Councilman Mark Primack, who lost his seat in November's election.

The council agreed to a lengthy list of conditions aimed at making the complex easier to bear for neighbors -- many of them the brainchildren of Councilman Ed Porter. They included designating more than $1.5 million in affordable-housing redevelopment funds for the Clear View Court mobile home park, whose 150 residents are worried that they'll be forced to live in the shadow of a huge parking garage. The funds also include compensation for "voluntary relocation."

Porter also persuaded the rest of the council to add conditions that will keep traffic away from Westside neighborhoods. And, at Coonerty's suggestion, the council agreed to reduce the size of the project by 7{ percent, or 20 rooms.

But Porter, Reilly and Tim Fitzmaurice ultimately voted against approving the project, saying the community deserved more time to feel they weren't being shut out of the process.

During last week's public hearings, representatives of the tourist industry and service and trade unions urged the council to send a resounding message to the Coastal Commission with a unanimous vote. Some supporters were disheartened the vote was so close.

"I was very proud of a council I saw working together, but then I was completely surprised when they decided not to work together," said Ted Burke, a partner in the Shadowbrook and Crow's Nest restaurants. "It's almost as if someone has a political strategy that mere mortals can't understand."

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