Santa Cruz Pallet Shelter

Santa Cruz Pallet Shelter


In April 2020, the first 15 of 30 interim shelter units opened for people experiencing homelessness in the City of Santa Cruz, CA.


  • Action was taken to address the imminent threat to unsheltered population’s health and safety:
  • Galvanized by the coronavirus emergency – “We recognized that we weren’t going to be able to achieve social distance in — a bunk bed is basically two feet away from the upper and lower bunk.” (quote)
  • City serves as a “regional shelter center” due to lack of shelters in neighboring cities
  • As in prior years, more than half of the county’s homeless population — 1,204 people — live in the city of Santa Cruz, followed by the unincorporated county and Watsonville (source)
  • The percentage of homeless who report living outdoors in parks, encampments or on the street is also steadily increasing — up from 24% in 2013 to 44% in 2019.
  • Martin vs. Boise case – Forces community to build adequate shelter before enforcing anti-camping laws. Case review.

Mission: Quickly provide non-congregate shelter to adjacent congregate shelter people experiencing homelessness in the City of Santa Cruz.


Owner: City-owned land leased to nonprofit on long-term basis

Previous Use: Paved parking lot

Use Arrangement: Ground lease

Site Selection Criteria Considerations: N/A


Upfront Development*$200kFrom Santa Cruz County – see notes
Cost Per Bed*$7k30 units in total
Operating Costs*$1.2 millionSanta Cruz County for one year of operations – see notes 

Possible FEMA reimbursement pending

Cost Per Bed*$40k/year


Funding Notes

Funding Notes:

  • For upfront development costs and one-year of operations, funding was provided from two primary funding sources: Santa Cruz County and Housing on Matter’s $250k COVID-19 Response Fund
  • Santa Cruz County’s combined investment in homeless services totaled $13.1 million during the current fiscal year, with the bulk of funds spent on health and human services.
  • Santa Cruz County’s Homeless Services Coordination Office budget had a $970,000 budget increase in 2019 for the county’s bringing the office’s budget up to nearly $2 million for the next fiscal year. About $590,000 of the new funds stem from Measure G, the half-cent sales tax increase approved by voters in November. An additional $333,000 comes from $10.6 million in one-time emergency state homelessness and housing funds allocated to the county earlier this year.
  • Given the lag in timing of funding, the County has fronted the cost, without guarantee of reimbursement from FEMA funding
  • Other – More than $2.6 million from the emergency state funds are set aside to purchase land for a year-round navigation center in North County, but it remains unclear when — or where — the center may be built. (source)
  • Funding from other state sources – notably HHAP and HEAP – we limited.


Lead Deal CoordinatorLogo1 Housing Innovation CollaborativeHousing Matters
Community EngagementUnnamed Housing Innovation CollaborativeCity of Santa Cruz
Construction ManagementPallet Logo Housing Innovation CollaborativePallet Shelter
Shelter Vendor / ManufacturerPallet Logo Housing Innovation CollaborativePallet Shelter
On-Site Assembly Pallet Logo Housing Innovation CollaborativePallet Shelter


Design Notes


  • Units are 64 sf, less than the minimum unit size of 70 sf, which requires a conditional approval from HUD.
  • Sole source vendor required waiver in procurement process
  • 85-day delivery made possible due to sole source vendor, low impact site work,  pre-approved shelter technology, ease of construction


Lead Operator:

Logo1 Housing Innovation Collaborative

OperatorHousing Matters, a 33-year-old, Santa Cruz-based homeless services nonprofit, runs a campus that has evolved into four emergency and transitional housing shelters for nearly 230 people, a medical clinic, and a 12-bed medical respite care facility. It is Santa Cruz’s largest homeless services provider.

Agreement1-year contract with City
  • 15 staff members for 30 beds
  • Shelter Manager
  • Program Supervisor
  • Logistic Coordinators
  • Case Managers
  • Security
  • Janitorial
  • Back-end Admin
Services ProvidedCase Management, Logistics, Operations
  • ~$75/night operating costs
Operating Expenses
  • On-Site Personnel
  • Maintenance
  • Client Services, meals
  • FFE, materials, supplies
  • 10% indirect general expenses


Operation Notes


  • Housing Matters is a nonprofit that has done work with the City of Santa Cruz in the past
  • Local preference policy at shelters

Relevant Materials