Now little more than a stopping point for truck drivers and weary travelers, Santa Nella may be on the verge of becoming the next bedroom community for Bay Area commuters.

Over the last five years, Merced County has adopted an updated community plan for Santa Nella and approved subdivisions containing more than 5,000 new lots, and a handful of new houses have been built. However, major infrastructure needs and endangered species habitat concerns must be addressed before large-scale development gets rolling.

“We have a lot of tentative maps, but not a whole lot of building,” said Bill Nicholson, Merced County assistant planning and development services director. “The biggest problem has been the Endangered Species Act with the San Joaquin kit fox, and working out habitat areas and migration corridors.”

Ever since Interstate 5 started serving motorists between the Bay Area and Los Angeles about 35 years ago, the town with the mysterious name (there is no Saint Nella) has provided a stopping point. The unincorporated town of about 1,500 people located 45 miles due south of Modesto continues to function mostly as a rest stop full of fast food, gas stations, truck stops and inexpensive motels.

Just as location has spelled success for Santa Nella’s roadside business industry, location is now the attraction to builders. The town is about 10 miles closer to the Bay Area than Los Baños, which has emerged during the last decade as a bedroom community for Silicon Valley workers. That does not mean that the drive is short or easy. Santa Nella is about 65 miles from the southern tip of San Jose, and included in that distance are about 15 miles of two-lane highway outside of Gilroy that are notoriously congested.

Highway improvements are planned, though, and the growth of Los Baños — whose population has doubled to about 34,000 in less than 15 years — gives developers hope.

The community plan, which the county updated in 2001, calls for about 6,000 new houses. That is about 10 to 15 years worth of growth, planners say.

The Santa Nella County Water District provides water and wastewater services to most of the planned growth area. The design of a new wastewater treatment plant that could handle up to 2.5 million gallons per day of sewage is nearly done, and the district is preparing an environmental impact report for the project, said Dennis Moniz, the district’s general manager. The district also has plans to build a water treatment plant that would produce between 5 million and 9 million gallons of water per day.

The district currently gets its water from the San Luis Water District, a wholesaler that has a contract to receive water from the federal government’s Central Valley Project. (San Luis Reservoir, which stores water from the Central Valley Project and the State Water Project, is only a few miles west of Santa Nella.) Santa Nella County Water District officials are negotiating a contract with the Bureau of Reclamation that would eliminate the San Luis district as a middleman. The Merced County Local Agency Formation Commission also is reviewing the proposed water rights transfer to the Santa Nella district.

Moniz, who became general manager in May, could not say when the infrastructure projects would be complete, but he suggested it may be several years. The district must not only complete the wastewater treatment plant’s environmental review, but must also acquire the land for the plant and for the disposal of treated effluent.

Moniz conceded that developers are pressing the district to move quickly, but he noted that the regulatory process is strict. “We’ve got to respond to the Department of Health Services and the Regional Water Quality Control Board,” Moniz insisted.

Roads are also an issue — and an expensive one. The growth area is served by Interstate 5 and state highways 152 and 33. However, there are few other roads, and, because of water canals from San Luis Reservoir, the road system will require numerous bridges, Nicholson said. The county has set road impact fees at about $20,000 per housing unit in the Santa Nella community plan area, by far the highest in Merced County. Developers also are expected to pay for the new wastewater and water treatment plants.

Like much of the San Joaquin Valley’s west side, the Santa Nella area does not have the best farmland, although the county is insisting that developers ensure preservation of an acre of farmland elsewhere for each acre of farmland developed in Santa Nella. The more significant natural resource is a corridor for the endangered kit fox, a house-cat sized member of the dog family that lives in the Central Valley’s natural grasslands.

“It’s a pinch point in terms of habitat,” said Cynthia Wilkerson, of Defenders of Wildlife’s Sacramento office. “There’s habitat to the north, and there’s habitat to the south. There’s a very small space at Santa Nella.”

Large-scale urban development in Santa Nella could be problematic, Wilkerson said, because it could discourage migration. The result could be isolated kit fox populations, which is bad for genetic diversity.

Individual developers have been working on small-scale habitat conservation plans, and the U.S. Fish and Wildlife Service approved an interim habitat plan earlier this year that allows for about 120 acres of development, according to Nicholson. Environmentalists, however, are insisting on a regional plan rather than piecemeal habitat planning.

Nicholson said developers and county officials are frustrated because the Fish and Wildlife Service has identified land zoned for growth as kit fox habitat. How that conflict will play out is unclear.

At this point, the county is insisting on a letter from the Fish and Wildlife Service clearing a project for endangered species purposes. How a developer gets that clearance is up to the developer, Nicholson said.

Bill Nicholson, Merced County Planning and Community Development Department, (209) 385-7654.
Dennis Moniz, Santa Nella County Water District, (209) 826-0920.
Cynthia Wilkerson, Defenders of Wildlife, (916) 313-5800.