Going against an independent arbitrator’s opinion, Santa Barbara County recently rejected a property tax exchange offer from the city of Santa Maria after a year of negotiations.
Mediation between the county and the city over the agreement—necessary for the Richards Ranch development project in Orcutt to move forward with a 44-acre annexation application—began during the summer of 2025. The two parties’ earliest negotiations date back to last April.
According to county staff, the Santa Maria exchange offer that arbitrator Elizabeth R. Feffer—a retired judge based in Los Angeles—ultimately sided with would result in an annual $212,000 net loss in tax revenue for the county.
During public comment at the county Board of Supervisors’ April 7 hearing, Santa Maria Assistant City Manager Chuen Wu asked officials to respect Feffer’s verdict.
“We think that the county had an unusually high number of requests for the city to imburse the county for past and future infrastructure improvements that will serve Orcutt,” Wu said. “All in all, I think the city has engaged with the county in a long process with mediation and arbitration, and we ask that the county respect the information and the outcome of that process. If more time is needed, the city asks that we have a continuance.”
According to Feffer’s final recommendation, drafted on March 3, she reviewed both the county’s and the city’s “respective last and best offers with respect to the exchange of property tax revenues, … as it pertains to the Richards Ranch mixed use project.”
After considering evidence submitted and counsel arguments, Feffer selected Santa Maria’s proposal over Santa Barbara County’s. The two-page document does not go into detail about the pros and cons of either proposal, which 3rd District Supervisor Joan Hartmann asked staff about.
“Did the arbitrator offer additional rationale for that choice?” Hartmann asked.
Assistant County Executive Officer Wade Horton replied: “No.”
According to Horton, the county’s offer allowed the county to basically break even, while Santa Maria’s would have left the county with $212,000 less in tax revenue each year.
Hartmann was the sole supervisor to vote no when 4th District Supervisor Bob Nelson motioned to accept staff’s recommendation and reject Santa Maria’s exchange offer. It passed 3-1 (5th District Supervisor Steve Lavagnino was absent).
“This has been so problematic from the get-go,” Hartmann said. “I think the developer has been trying every which way from Sunday to figure out what might work and running into roadblocks everywhere, and I don’t feel proud about this.”
“I do feel proud,” Nelson said, “about the work that our county’s done on this. … This is unfortunate, but it was unfortunately predictable.”
Along with Santa Maria Assistant City Manager Wu, representatives of the Home Builders Association of the Central Coast and Richards Ranch developer Michael Stoltey requested a continuance from the county. Hartmann also voiced support for a continuance before the vote.
“This site has been in the county zoned as it is today since the 1990s,” Stoltey said. “It does not have a viable water source, and for decades through prior ownership—including Walmart for nearly 20 years, now us for five—there has been no feasible path to development. During that entire time, the county has not solved water, has not initiated a project, has not rezoned the site.
“To now assume that the site might generate more,” Stoltey continued, “if developed in the county and use it as a reason to deny annexation is not grounded in reality.”
This article appears in April 9 – April 16, 2026.