Major Obstacles Face Plan to Sell Prime VA Lands

The Reagan Administration has proposed selling more than 100 acres of government land in Los Angeles in a transaction that could change the face of one of the city’s fastest-growing neighborhoods by opening up extensive swatches of real estate that have been undeveloped since the days of the Spanish ranchos.

The proposal to sell Veterans Administration holdings in Westwood and the San Fernando Valley community of Sepulveda for $360 million was quietly revealed in a letter from the VA to both houses of Congress on Feb. 5.

It is part of President Reagan’s long-held goal of shrinking the national government, but the proposal is expected to face serious obstacles as it makes its way through the political process. They include:

- Questions raised by Rep. G. V. (Sonny) Montgomery (D-Miss.), chairman of the House Veterans Affairs Committee, who has suggested that the land be kept in reserve.

- Opposition from local officials, who have vowed to block any development that would aggravate traffic on congested Westside streets or threaten the Mission Hills Little League baseball diamonds in Sepulveda.

- A legal challenge from the heirs of pioneer families who donated much of the Westwood land almost 100 years ago for an old soldiers’ home. VA attorneys said the families’ claims that the land should revert to them could take years to settle.

At issue are parcels that make up just under 25% of the 442-acre Veterans Administration complex in Westwood, and 64 of the VA’s 146-acre hospital grounds in Sepulveda.

The proposal--which came over objections within the Veterans Administration--was initiated by the Office of Management and Budget as part of the 1987 federal budget.

Despite the problems, Mia Kelly, management and budget office spokeswoman, said the Administration’s top priority now, as it faces the deadlines of the Gramm-Rudman budget-balancing bill, is “cutting the pork . . . cutting any kind of excess in government.”

This “privatizing” strategy includes the proposed sale of federal assets nationwide, including the Bonneville Power Administration in Oregon, the Navy’s Teapot Dome petroleum reserves in Wyoming, Earth satellites, other federal lands and a chunk of the government’s $200 billion in outstanding loans and other obligations.

Kelly acknowledged the existence of “legal concerns as well as basic business concerns” about putting the VA property up for sale at a time when land prices may be depressed because of restrictions on development imposed by Los Angeles officials.

‘Willingness to Take Risks’

“The theme we’ve perceived here is a willingness to take those risks right now,” she said. “If we need it in 10 years, we’ll deal with it then.”

Everett Alvarez Jr., acting VA administrator, told a congressional hearing earlier this month that he is “100% in agreement” with Montgomery, who asked whether it would not be wiser to save the land for future VA expansion or simply to retain a green space in the heart of a fast-growing area.

Nevertheless, the acting director said in his letter to Congress that the VA hopes to raise $360 million through the sales, a sum that White House planners already have included as revenue in the VA’s 1987 budget.

“If the VA really doesn’t need it, that’s fine. Let them go ahead and get rid of it,” Montgomery said later through a spokesman. “But we object to forcing them to get rid of land where there is a potential VA use of the land.”

The land includes some of the most attractive real estate in Los Angeles, including a 10-acre triangle at the northeast corner of Wilshire Boulevard and San Vicente Boulevard.

Real estate brokers said this land would be ideal for an office building or entertainment complex were it not for the determination of city and county officials to freeze development along the Wilshire Corridor.

“I would love that land,” said Peter Chirchick, a sales officer at the Fred Sands real estate office in Beverly Hills. “I would have several clients who would be interested.” However, he said, because of zoning problems, “I sincerely doubt whether you could put in a high-rise (building),” like the office towers that have sprung up farther west on Wilshire Boulevard.

County Supervisor Ed Edelman, the elected official who would be responsible for the unincorporated area if it leaves federal hands, said, “I think I’d be concerned about any increase in density.”

“I think it’s foolish for the federal government to bail out its financial condition by selling public land,” he said. “Public land is public land, and unless there are overriding considerations, it should not be sold.”

Zoned for Residential Use

The entire VA tract in Westwood is currently zoned for multiple-residential use. It is also designated “P” in the county general plan, which sets it aside for public and semipublic purposes.

The Westwood parcels also include 49.6 hilly acres that separate the VA’s psychiatric hospital from the mostly residential neighborhood of Brentwood. Others include a strip next to the Westwood National Cemetery, a palm garden near the San Diego Freeway off-ramp at Wilshire Boulevard, open land behind the Air Force, Army and National Guard armories on Federal Avenue and parking lots and lawns near Ohio Avenue.

In the San Fernando Valley, the 46 acres designated for sale include open land around the 550-bed hospital, including three Little League fields and the nine-hole Mission Hills public golf course.

Local VA officials said the agency could possibly need the land at both sites some time in the future. This is because millions of World War II veterans are expected to increase the demand for services in coming years.

‘Not Happy About It’

“We’re not happy about it. I’d hate to see any of the property being ‘excessed,’ ” said William K. Anderson, director of the 1,645-bed VA Medical Center at Westwood.

He said the agency’s long-range plans call for using the land for research facilities and as a site for the agency’s Department of Veterans Benefits, which is currently housed in the Westwood Federal Building. Additionally, he said, the community and the hospital need the buffer provided by the ravines that cut off the psychiatric hospital from Brentwood.

The VA made its first step toward selling some of its Westwood property in 1983, when a 2.13-acre sliver isolated by the San Diego Freeway was declared surplus.

Once leased by the City of Los Angeles as the site for an airport bus terminal, the property now has been scheduled for auction March 27 over the objections of Edelman. The Board of Supervisors has instructed its attorneys to take legal action to block the sale, arguing that the government’s advertisement gave misleading information about restrictions on development.

The county had been negotiating to buy the terminal site for $2 million for possible use as senior citizens’ housing, but the talks fell through and the federal government now hopes to sell it for at least $7.5 million.

It was this development that kindled the hopes of two long-time California families, whose ancestors donated the land in 1888 to “establish, construct and permanently maintain” a home for disabled veterans.

Once the 2.13-acre tract was put up for sale, the heirs hired an attorney to investigate a possible claim on the grounds that it would no longer be used to benefit veterans. While the more than 150 heirs have not yet taken any action, their attorney, Ronald E. Gother, said the Administration’s decision to sell another 109 acres could spur an additional challenge.

In any case, attorneys for the VA foresee a complicated legal wrangle that might not be resolved for years. Although the VA attorneys concluded that the government is free to dispose of the land, “enough uncertainty remains over the proper construction of the deed as to make marketing this land extremely difficult,” said an internal memo dated Dec. 30, 1985.

“Final resolution will no doubt take several years, unless the heirs are willing to accept a settlement,” the memo said.

Claims Traced Backed

The heirs trace their claims to Sen. John Percival Jones, a U.S. senator from Nevada, and Arcadia Bandini Stearns de Baker, the wife of Jones’ business partner, Robert S. Baker.

Jones and Baker laid out the city of Santa Monica in 1875 and donated the Westwood land to what was then called the National Home for Disabled Volunteer Soldiers, hoping to attract business to their new city.

Congressional staff members said any action to block the sale would most likely be included in a wide-ranging bill covering veterans’ affairs. If Congress takes no action, the law provides for the General Services Administration to put it up for sale six months from the date of Alvarez’s letter.

In addition to Rep. Montgomery, a spokeswoman for Rep. Anthony C. Beilenson (D-Los Angeles) said the congressman is opposed to the sale because of its impact on the VA as well as on traffic problems.

Councilmen React

Los Angeles City Councilmen from adjoining districts also criticized the proposed sale.

“For that public space to be used to add to the congestion of the city is just contrary to the overall public interest,” said Councilman Marvin Braude.

Councilman Zev Yaroslavsky said, “It’s economically foolish for them to unload this property under the guise of dealing with the deficit problem.”

Councilman Hal Bernson, whose district includes the Sepulveda site, said his main concern is keeping the Little League fields. “Whoever they may sell that property to,” he said, “is obviously going to have to deal with the city.

“I sincerely doubt they will go through with the sale of the property. I think it’s Gramm-Rudman scare talk.”