Council narrowly approves 35-unit downtown project at 339 S. Escondido Blvd; four units deed-restricted very low income

The Escondido City Council on June 25 voted 3-2 to approve a planned development and design review permit to build a five-story, 35-unit residential building at 339 South Escondido Boulevard. The project includes four very-low-income deed-restricted units, 16 off-street parking spaces and a building footprint of about 34,463 square feet.

Ivan Flores, principal planner, described the proposal and the state laws that affect it. The project will demolish an existing property that currently includes four small residential units and an auto dealership. Staff said three of the four existing units qualified as "protected units" under the state replacement law (identified in the staff report as a Senate Bill requirement), requiring replacement units as part of redevelopment. The developer is also invoking state density bonus law to increase allowable density; planning staff and the applicant said the density-bonus calculations and replacement requirements overlap so the project will provide four affordable units on-site, three of which replace protected units.

Flores and city planner Veronica Moronis said the project is categorically exempt from further review under CEQA Section 15332 (infill development). The Planning Commission recommended approval on a 4-1 vote; the commission record and discussion raised eligibility questions about a reduction in on-site open space and use of state density-bonus incentives.

Applicant Kyle Carruthers told the council the design includes a range of materials, patios and balconies along Escondido Boulevard and West Fourth Avenue, and that the project cannot accommodate additional parking or open-space area without making the project infeasible on the roughly 10,000-square-foot lot. The proposal provides primarily studio and one-bedroom units; the applicant and staff said that unit mix and proximity to transit were factors in justifying reduced parking requirements under state law.

Council discussion tracked planning staff's explanation and ranged from support for adding housing to concerns about parking, open space and impacts to neighboring businesses. Council members seeking additional time to analyze potential litigation or further legal findings discussed continuing the matter, but a majority voted to adopt the staff recommendation.

The motion to approve the project was moved by Deputy Mayor Martinez and seconded by Council Member Fitzgerald. The council's roll-call announcement of the final tally stated the motion passed 3-2; the record shows two no votes against the motion (Mayor White and one council member with the surname Garcia). The approved actions include introducing Ordinance No. 2025-04 and adopting Resolution No. 2025-68 to approve the project with the conditions listed in the staff report.

The project's approval includes the environmental determination under CEQA Section 15332 and authorization for staff to finalize permit documents and conditions.