Residents Near Airport Criticize Plan to Buy or Soundproof Homes

When Orange County offered Sandra Shambaugh $177,000 for her five-bedroom, three-bath home with pool, she took it. She wasn’t happy about the price, but she needed the money.

David Magnuson felt the county gave him a fair price for his home, $176,500, which was $11,000 more than he paid three years earlier. But he accused the county of reneging on its promise to pay $2,480 to cover “points” on a new mortgage.

Shocked at Price

Marianne Towersey was flabbergasted when a county appraiser hung a $235,000 price tag on her home. She hired her own appraiser, who put the value at $310,000.

Shambaugh, Magnuson and Towersey are part of an ambitious, multimillion-dollar county program, which, to comply with state law on noise levels, will soundproof or buy homes in Santa Ana Heights near John Wayne Airport. The area has been plagued by jet noise for two decades.

A year after the program began, however, only one person--rather than the expected 30 or 40--has volunteered to have a home soundproofed at county expense. And people who have sold their homes to the county are complaining about sale prices or about promises they say were broken.

“My experience with the county has been that they say one thing and do something else,” said Shambaugh, who used the money from the sale of her five-bedroom home on Pegasus Street to buy a two-bedroom condominium in Costa Mesa.

Nearly two months after she moved, the county still had not reimbursed her for moving expenses, she said. And she, like Magnuson, said the county failed to follow through on a promise to pay “points”--cash charges imposed by banks on mortgage loans, which she said totaled $2,250. She is fighting for that money.

Littered With Lawsuits

The history of county-operated John Wayne Airport since the jets came in 1967 is littered with fights and lawsuits between the county and residents of Santa Ana Heights, a once-tranquil enclave of spacious two-story homes on sleepy cul-de-sacs, with backyard pools, landscaped lawns, horse trails and stables.

Homeowners who were living in the area before the jets arrived say they watched property values decline when the roar of the aircraft engines began, as fewer and fewer people were willing to move into a neighborhood where noise drowned out television, interrupted telephone conversations and made homes vibrate like tuning forks.

Residents battled against plans to expand the airport, contending that a bigger airport with more aircraft and more flights meant more noise.

More than a year ago, the county settled a court battle that resulted in expansion of the airport, though to a lesser degree than the county wanted.

Then the supervisors turned their attention to Santa Ana Heights and to meeting state laws barring residences in high-noise areas because of the harm that is done to people’s health.

The county said soundproofing 450 homes could cost $6 million. If one-fourth of the approximately 360 homes eligible for purchase because of their location in high-noise areas were offered for sale, it could cost the county $30 million, officials said.

The county put up $2 million for “seed money” to begin the house-buying program. The architects of the plan said they would buy houses, soundproof them and resell them, using the money from sales to buy more homes in the area. Some houses would be demolished to make way for commercial development. Later this year, there will be a bond issue to raise more money for the program.

The county took applications for the program for a year, giving preference to residents suffering financial or medical hardship. Eight purchases have been approved so far, and another three dozen homes are on the waiting list.

Ed and Arlene Hall are on that list and are getting increasingly nervous about what they have seen.

Although the soundproofing and purchase programs are voluntary, Hall said he worries that the county will not give him a good price for his house and will condemn it if he refuses to sell.

The county has not condemned any property so far and pays for the appraisal of the home of program participants. If homeowners disagree with the appraisal and want their own, they must pay for it. If there is still disagreement, the county and the homeowner split the cost of a third evaluation and both sides must accept it.

Hall, who retired as a captain with the Newport Beach Fire Department in 1971 on a disability pension after a three-story fall, said he is concerned about possibly having to pay $700 for his own appraisal and then $350 for the binding one.

He also is worried about finding another home comparable to his anywhere in the area.

“We don’t want any more than is coming to us,” Arlene Hall said. “We just want a fair shake.”

Now, wondering if or when their home on Indus Street will be sold, she said, “You can’t make any plans. . . . You don’t want to put a new roof on for $4,500 if you’re not going to get your money back. You don’t want to put new drapes and carpets in if you’re not going to get your money back.”

The Halls moved into their house in 1964, in the pre-jet age. Ed Hall, now 62, was formerly a commercial pilot and Arlene remembered that it was “kind of colorful watching the small planes” at the airport.

“I purposely went here because I like airports and I used to fly from the airport occasionally in my biplane,” Ed Hall recalled.

He planted 22 fruit trees and three sequoias in the backyard. He is resigned to walking away from his home of 23 years some time in the future but he would like to stay in the community.

But a comparable home he can afford is likely to be far inland, he said.

“This is home,” he said. “Our churches are here, our schools. I don’t have any interest in North Tustin or Westminster or Little Saigon or Garden Grove.”

Hall founded a residents’ group called Concerned Home Owners of Sherwood Estates (CHOSE) to lobby the county for changes in the program and issues periodic newsletters on the organization’s meetings with officials.

One of the changes suggested has been in the system of appraisals, a change Marianne Towersey would welcome.

Towersey contends that when the county-hired appraiser valued her house at $235,000--far less than the amount they owed on the house--she was told that if she hired her own appraiser and his evaluation was higher, the county would pay it. The second appraisal was $310,000. The county refused to pay unless both sides split the cost for a third, binding appraisal. As a result, Towersey is suing the county for what she says is its failure to live up to an oral agreement to accept the second appraisal.

Towersey also criticized the county’s appraiser for comparing her house to others that sold at “distress” prices because of foreclosures or divorces that led owners to look for a quick sale.

If the county had paid $310,000 for the West Birch Street house the Towerseys bought seven years ago, it would have barely covered the mortgage, she said. Yet, “We were willing to take the loss just to get rid of all the turmoil.”

Even Magnuson, who felt he got a good price for his house, believes he was one of the lucky ones.

“For some of the other people in the residential area there, it’s not a fair deal, what (the county is) offering them,” he said.

Comparable housing has been an issue since before the program began. It was a sticking point at the first meetings that county officials began holding in late 1985 and early 1986 to prepare the community for the program, solicit suggestions and explain plans.

Since then, there have been dozens more meetings with officials of at least three county offices and with Supervisor Thomas F. Riley--whose district takes in unincorporated Santa Ana Heights--and his staff.

Paul J. Douglas, a county property agent involved in the program, said that “people were a little suspicious” when the program began because of so many years of fighting the county over airport expansion and jet noise. There was a “prove to me that the county is going to do something” attitude, Douglas said.

A major problem, he said, is the “continuing issue of replacement value,” with residents wanting enough money to replace their houses with others about the same size in nearby neighborhoods. But the county is restricted to paying market value, he said, giving homeowners the same price as comparable homes in their immediate vicinity. Because of the noise issue, market value usually is significantly below the replacement value homeowners expect to receive.

Douglas and other county officials also said that county lawyers have restricted their actions in some cases, ruling that program modifications proposed by residents in some cases do not follow state law on redevelopment and resettlement programs.

Douglas said the county will pay up to $15,000 in “relocation assistance” in addition to the purchase price of the home. The money covers moving expenses, closing costs on a new home and other items.

Supervisor Riley, in a letter to CHOSE last week, reminded group members that the home-buying program was intended not only to comply with state law but to help residents who were unable to sell their houses to private buyers.

He called the appraisal process and the entire program “fair” to the county and homeowners and said there were “years of review and scrutiny prior to adoption” of the program.

County lawyers ruled that paying anything other than market value could be interpreted as a “gift of public funds,” which would be illegal, Riley said.

As for the soundproofing program, Richard Adler, a county official who got the home-purchase and soundproofing programs started, conceded that “we have not had a great deal of luck” in that area.

Homeowners could pick either the home-sale program or the soundproofing option, but not both.

When the programs started, Adler said he hoped to have 30 to 40 homes soundproofed at the end of a year, with homeowners giving the county in exchange an “avigation easement,” meaning giving up any chance to sue over noise and other problems caused by jets flying over their houses.

Adler said the county offered to soundproof 37 homes, but only three owners accepted free inspections of their homes and only one actually signed a contract for the acoustical insulation.

Said Adler, “There’s always the problem of being first and kind of the ‘guinea pig’ syndrome.”