Nipomo housing project moving ahead, lawsuit settled

May 29, 2025

By KAREN VELIE

After months of negotiations, the developer for and opponents of a large housing development in Nipomo, known as the Dana Reserve, reached a settlement agreement that whittles down the number of housing units while providing a “significant” financial payment.

In April 2024, the San Luis Obispo County Board of Supervisors voted 3-2 to approve the then more than 1,400-unit housing development located on the west side of Nipomo directly adjacent to Highway 101. The controversial development also includes commercial, recreation and public services such as a dog park.

During the meeting, members of the Nipomo Action Committee asked the board to delay the project while promoting their own plan, which whittled the project in half through the removal of higher priced homes. More expensive homes generally cover the infrastructure costs for lower priced homes.

The Nipomo Action Committee and the California Native Plant Society filed a suit on May 28, 2024 against San Luis Obispo County in an attempt to stop the development.

As part of the recently agreed to settlement, the number of housing units will be reduced by 229, or approximately 16%. The reductions cut the number of affordable housing units to be built in half.

“Despite this reduction, the project still includes deed-restricted, affordable housing units, with first priority given to Lucia Mar Unified School District employees, and a full ladder of housing types to help address the region’s housing shortage,” according to a press release form all parties in the lawsuit. “Some of the benefits that remain are the down payment assistance program, local priority, and on-site childcare, as originally approved.”

In addition, the parties agreed to design modifications to protect sensitive plant species and 195 coast live oak trees.  Also, NKT Development will pay a “significant” amount of money to be earmarked for public benefits specific to Nipomo. The Nipomo Action Committee which will oversee the funding.

The proposed changes require review and approval by the San Luis Obispo County Board of Supervisors.