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NOVEMBER UPDATE
Everyone,
Things continue at a good pace and in this update
we'll brief you on a visit from the State Coastal Conservancy, status of
the South Bay Parkland Conservancy; good news from the Sierra Club;
the City's recent planning for the Vision vote in March, 2005; and another
profile of Open Space success.
General News
On October 6th, we had a great meeting with
Peter Brand (no relation) of the State Coastal Conservancy, where
he discussed some of the projects they have funded and completed that are
similar to our Heart Park vision. Peter also laid out the process by
which communities organize around their desire to secure coastal open space and
secure State funding. Peter is a State
official who has spent the last 20 years
restoring and preserving many coastal areas for open space and has
been working regularly with us since March of this year. As with most
communities that Peter has worked with, he reinforced that the most important
thing is for the community (both City leadership and citizens) to first decide
this is what they want and then begin the proper land-use designations.
Peter told us that Heart Park is definitely a viable option for this site
and has worked with AES, in particular, in acquiring other power plant property
in the State.
Sierra Club passes Resolution to support
Heart Park
The Palos Verdes South Bay (PVSB) group of the LA
Chapter of the Sierra Club passed a resolution in October, to formally recognize
and endorse the Heart Park vision. We are very proud of
achievement for several reasons. One, this endorsement proves that,
along with the State Coastal Conservancy, a major institution with a strong
reputation believes our vision is a viable alternative to
over-development. Second, this will garner additional publicity for us
throughout the South Bay, publicity that will also call out the real danger we
have in over-development. Third, we can
anticipate political, organizational AND financial support from the PVSB
group as we get closer to our advisory vote in March, 2005. Many thanks to
Barry Holchin, Johanna Zetterberg, Al & Barbara Satler, and others at the
PVSB/Sierra Club for all their help and encouragement. Several people
in our Heart Park group are also members of the Sierra Club and we thank you,
too. If any of the rest of you are interested in learning more about the
PVSB group or joining the Sierra Club, go here:
The SBPC continues to gain
ground
The South Bay Parkland Conservancy (SBPC) is
gaining members and beginning its fundraising activities. After
the first meeting in September, they have raised $3,300 and
continue to build their membership. They have a goal of 500
members by year-end and are putting together a Communications budget,
fundraising plans and a push for new members. The SBPC is a non-profit,
public benefit corporation that seeks to educate the public on
the need and viability of open space in the South Bay, to preserve our
quality of life.
If you are interested in joining the SBPC, annual
dues are $25 for adults and $40 for families; dues are tax-deductible. Or
please make a tax-deductible donation of $50 or $100 to help
them get the word out on what the South Bay stands to gain with more
open space, and what we are at risk to lose with more over-development.
Make your check out to: South Bay Parkland Conservancy and send to P.O Box
7000-408 , Redondo Beach, CA 90277
Open Space Success
Profile
Most everyone has heard of Hearst Castle. If not, its a mansion on
the Central Coast of California built by William Randolph Hearst, the publishing
magnate and land baron. I highly recommend a visit if ever you find
yourself up there, just north of San Luis Obispo.
Well, for many years the heirs to the Hearst family fortune wanted to
develop their land - 82,000 acres with 18 miles of coast
line. Originally they were going to build 400 homes, 2 hotels
with a total of 640 rooms, and golf course. Sound
familiar? Spread-out over 82,000 acres that doesn't seem so bad. Down
here in Redondo, if you ditch the golf course, all we need is 50
acres. In fact, we already have a name for it, The Village Plan.
Anyway, The citizens in this community realized the value of what was about
to be developed and mounted a long campaign to find a way to save this area for
all the generations to come. We are often struck by the enormity of
what we are trying to do, but can you imagine the courage it took to think you
could somehow save 82,000 acres, and 18 miles of coast line in California,
AND YOU HAVE NO MONEY. Now that sounds familiar. We can only
imagine what a fiscal analysis of their vision would have looked like after
zoning all that land for 55 units per acre.
Forge ahead they did, and with the help of the State Coastal Conservancy,
the Federal Government, and the citizens of the rest of California, success is
finally theirs! You can read all about it in the above link, but let me
explain the financing of the deal to give everyone a taste of how complicated,
but doable these projects are.
The land was valued at $230 million by an independent appraiser and is
being bought for $95 million by the California State Coastal Conservancy.
The Hearst Corp. is seeking a federal tax write-off for the difference, which
gets them another $70 million, approximately. They also will receive
another $15 million in state tax credits. Of the $95 million being
packaged by the Conservancy, $23 million will come from the federal
transportation dollars to preserve scenic highway views, $57 million from
Proposition 40, and the balance from the Wildlife Conservation Board.
Obviously we have our work cut out for us, but again, can you imagine
the odds these people were given of success just 5 years ago, never mind
the 20 they've been working on this project? And lest we forget,
the citizens of this area are not paying a dime for this deal! Not
even a penny.
City's Fiscal Analysis of HOC
Visions:
Overview and summary:
At the Oct. 12th Council Meeting, the results of
the Fiscal analysis were presented, by the City's paid consultant, David Taussig
& Associates. As you might expect, the study painted a grim picture of
the potential of the Heart Park vision, but also cited major risks with the
Village Plan. Bottom-line, the consultants said both
plans have minimal financial chances for success. For Heart Park, the key
point is acquiring the State funding (ie. Coastal Conservancy) to buy/build our
Park and wetlands, which in the consultant's opinion has a low chance of
happening. For the Village Plan, financial success depends
heavily on the 400-500 room, 5-Star resort hotel and the 50 room boutique hotel,
because the proposed residential development (350 units now) is a big net
money-loser for the city. The consultants went to
great lengths to state their analysis was basically number-crunching only, NOT a
feasibility analysis. In particular, they strongly recommended that if the
City chose to move forward with the Village Plan they should do a hotel
marketing study first to truly evaluate the hotel's potential.
For our vision, other than having to combat the
outrageous cost numbers being thrown around, nothing has changed. We've
always known that our vision depends on State bond funding and NOT pushing City
coffers over the brink. Given that the State has raised $billion (yes,
billion) over the last 6 years for acquiring/restoring Open Space along the
coast.. we feel pretty good about Redondo's chances, IF the city and residents
give it a chance. For the other guys... well, how badly do you want
another hotel in the area? And a resort/convention destination hotel at
that. Doesn't that Development plan sound more and more like the original
HOC plan??
More details:
In terms of summarized dollars and cents, the
study calculated the one-time costs of the Village Plan to
be ~ $50Million and for Heart Park at ~ $350Million. Why the outrageous
variance you say? Well, the consultants ignored the cost to acquire,
clean-up and build ALL property associated with the Village Plan's
residential and commercial (Hotel, retail) components because it is assumed that
private development would pay it all (including the 65foot-wide
canals!) and that calculating all this cost was out-of-scope. In
contrast, all the costs were included for Heart Park because no private
development is anticipated. It's important to note of the study's $350M
number for Heart Park, nearly $320M is for acquisition and remediation of the
land (mostly to AES even though they are required to clean-up the land), based
tax-assessed value and AES's own estimated costs for clean-up. In
follow-up last week, the consultants indicated privately, that obviously
this $320M would also be part of what Private Developers would be expected to
pay BEFORE they begin their additional infrastructure development of canals,
roads, utilities, etc. Funny how that didn't make the final
printing.
As for recurring annual costs
(mainly the forgone annual revenue from AES plant's tax pmts [~$900K] +
annual operating expenses of each vision, net of revenues generated), the
study shows Heart Park "costing" the city about $2.9Million/year. This is
way inaccurate, because the Study assumes that Heart Park is 76
acres and replaces all of Village Core South with green grass and
trees, which was NEVER our intention. PRO zoning allows for
visitor-serving commercial which... guess what... is what is already there at
Village Core South!!! As we've publicly stated earlier, we are happy
with VCore South the way it is. Plus, Heart Park is only ~
60acres of Areas A, B and C. So if you correct for this error, our
vision's "lost" revenue for the City goes from $1.8M, down to $1M/year.
Plus, the Study mostly ignores the potential for significant revenue from our
parking structure, fees from playing fields, aquatic center and
fees/sales tax of our proposed community center/restaurant near the corner of
PCH and Herondo Streets and concession revenue along Harbor Dr,
which could further reduce the annual net "loss" to around
$1.5M/year.. not $2.9M. And this doesn't include any money that City
of Hermosa Beach may be willing to contribute to help operate and maintain a
55+acre park directly across the street from their
Southern boundary. Given that Hermosa was suing Redondo over the
original HOC plan for the negative impact it would cause, it's fair to say that
HB may be a willing neighbor to help with operating a park that will
help increase their property values too. We just have to have the vision
to ask.
Meanwhile, the Village Plan is estimated
to "earn" the City about net $775,000 a year in fees, revenue,
etc. Think about that for a minute. After incurring the risk of
private development building 350 homes, 2 hotels with fractional-ownership
condos, 5 acres of freshwater lake and 65foot-wide canals (built 12ft above
Harbor Dr), a pedestrian bridge to the pier and 100,000 sq ft of additional
commercial space... generating over 12,000 additional DAILY car-trips... over X
number of years of construction and financing... our City earns $700K or
about 1.2% of the City's current general fund of $50M. You evaluate that
risk/return balance and make your own decision.
What's next?
At the November 9th City Council meeting, Council
will review and debate proposed language for the description of each vision on
the advisory ballot. This ballot language will need to be finalized by
early December to meet the March 8, 2005 election deadlines.
See you next Tuesday at 6:00 p.m., at the Beach Cities
Health District, 514 N. Prospect Ave., Beach Cities Room, Floor
B, to for our meeting with Katherine Spitz and Eric Gibson, of Katherine
Spitz Associates, a land scape architectural firm in Marina Del Rey.
The Coastal Conservancy cajoled them to do a pro-bono design for our
vision. The same Coastal Conservancy that cajoled $95 million for Hearst
Ranch.
Bill Brand
310-374-4001