A controversial housing development proposed on a site with a historic building is now cleared to obtain building permits after the SLO City Council voted 3-1 on April 4, with Mayor Heidi Harmon dissenting, to deny an appeal of the project brought by two neighbors.

City Councilwoman Andy Pease recused herself from the discussion due to a conflict of interest.

Proposed at 71 Palomar, at the corner of Luneta Drive and Palomar Avenue, the development includes six new apartment buildings with 33 units, including four units set aside for very low-income renters and the relocating of the Sandford House—an old fraternity home on the city’s historic buildings list—to a new spot on the property. The project also calls for removing 55 of 59 trees on site.

The appeal—submitted by residents Lydia Mourenza and Teresa Matthews—aimed to overturn the Architectural Review Commission’s decision to approve the project. The appeal cited flaws in the development’s environmental review, which determined a full environmental impact report wasn’t needed, as well as its adherence to city regulations on neighborhood compatibility like aesthetics, traffic, parking, and other issues.

“[The city] threw so many regulations out the window,” Mourenza told New Times on April 5. “That seems to be the way the city is going. If housing is involved, [the project] gets approved.”

Harmon told New Times she felt the project as it was proposed sacrificed too much of the property’s unique character. She thought that more constraints on the developer could have “inspired a potentially better and more interesting design” that could “maintain the essence of that property.” She also expressed broader concerns about development in the city.

“There are definitely questions percolating, that there’s concern we’re shifting direction and losing some of that authentic, essential nature of what it is to be SLO,” Harmon said.