Reservoir Is First, Resort Plans Second at Sweetwater

When Bob Gosnell, a millionaire developer with three thriving Arizona resorts, banked his helicopter over South Bay’s Sweetwater Reservoir in late 1981 and gazed down at the green fields and waterfront acreage of the Hansen Ranch property, he knew he’d found a perfect place for another Pointe Resort.

For many South Bay residents, the prospect of a first-class, five-star resort which would outshine North County’s La Costa was a dream come true. South Bay’s image as a dumping ground for unwanted facilities--prisons and sewage ponds, trash dumps and low-income housing projects--would be erased by the advent of the upscale EastLake planned community and the world-class Pointe Resort.

When Gosnell returned in the summer of 1982, he found his “lake-front land” was a mile from water and learned that the 750 acres he had under option at the eastern end of Sweetwater Reservoir fronted most of the time on a weedy mud flat--a better breeding place for mosquitoes than a vista for his proposed $750-million resort and planned community. In fact, that brimful lake that Gosnell first saw was a phenomenon that had occurred only 15 times in the past 100 years.

“It was a wet year,” Garry Butterfield, Sweetwater Authority general manager said of that winter of 1981-82. “The lake was as high as it has been since 1944. Then the summer months came along and we began to draw down on the reservoir. He (Gosnell) came back and, lo and behold, that property was no longer lake-shore property.”

Ready With a New Plan

Undaunted, the millionaire developer approached the Sweetwater Authority, keeper of the reservoir and purveyor of water to much of South Bay, with a plan to remedy his project’s problem.

Gosnell offered to dredge the reservoir, at no cost to the district, and put the spoils on the sloping eastern reaches of mud flats where the Pointe property lies, bringing it up to a level even with the dam. A good deal for the water company because it increased the depth and capacity of its reservoir, and a good deal for Gosnell because it increased his property by 250 to 400 acres and assured his project a permanent deep-water lake front.

But the Sweetwater Authority board politely but firmly said “no” to the Gosnell proposal, pointing out that the dam and the reservoir had been serving its purpose of supplying water to South Bay communities for nearly 100 years without dredging or shoreline development, so why should the board tamper with a winning formula? If it ain’t broke, don’t fix it.

During the five years since that first tentative feeler, Gosnell’s lieutenants have continued to woo the seven-member authority, offering to construct a diversion drainage system which would prevent urban runoff from existing development from contaminating the Sweetwater Reservoir (price tag, $8 million); to replace the reservoir’s aging water pumping system ($1 million or more); to deepen and reconstruct the reservoir with little or no interruption of the reservoir usage ($30 million); to contribute about $3.5 million to the Sweetwater Authority for buildings placed on the newly filled property, and a half-dozen other tempting added incentives in an attempt to move board members off their negative stance.

Voted to Break Off

In May, 1985, however, the authority board voted 7-0 to break off negotiations with Pointe representatives and to cancel plans for Pointe-paid, authority-supervised engineering studies. Recently, the board voted 6-0 (with new member George Waters, mayor of National City, abstaining) to reaffirm that stand.

Butterfield, who wants to be anywhere except in the middle of a standoff between a powerful and determined developer and a reluctant and determined authority board, admits that Gosnell’s plans were at times overwhelming.

“It was almost like being in a dream,” he recalled of the give-and-take between the authority board and Pointe men. “Every time we would express any concern or point out a problem (with Pointe plans), they would come back and say, ‘Oh, we’ve changed our plans on that,’ or ‘We’ve taken care of that.’ One reason it has been so hard to evaluate their plan is that it was like trying to hit a moving target. The project kept changing,” Butterfield said.

He concedes that the Gosnell organization performed somersaults in efforts to win at least a definite maybe from the authority. The water board was deluged with letters of support for the Pointe project from politicians at every level of government. Pointe supporters ran for board seats, but lost. Pointe officials offered free off-season stays at the Phoenix Pointe resorts to demonstrate to South Bay residents what they were missing. A permanent Pointe beachhead was established in the heart of opposition to the development--Bonita--with offices built in lavish Pointe style.

Feared for Water Service

Former National City Mayor Kile Morgan, now retired from his city and authority posts, says he would have liked to see the Pointe resort approved “if we could have done it without hurting our water service. But we were running a water service. That was our job.” Morgan never took Gosnell up on his offer of a free trip to a Pointe resort in Phoenix “but everybody who did go came back raving about it. We sure could use something like that around here.”

But one factor remained unchanged: the water board members’ firm contention that they did not want a resort, or any other urbanization, on the shores of their reservoir nor, as Pointe developers proposed, did they want their reservoir “improved.”

Authority director Cary Wright recently attempted to challenge the increasing clamor for reconsideration of the Pointe proposal in a letter to the editor of the Chula Vista Star-News. The job of the authority is to protect the water supply of 150,000 customers in Chula Vista, National City and the Sweetwater Valley, not to subject the reservoir to projects that might put additional pressure on the 99-year-old dam or expose faults by dredging the reservoir’s naturally sealed bottom, Wright contended.

Butterfield pointed out that the Pointe proposal to take 16 million cubic yards of silt and soil from the reservoir bottom to fill in the eastern edges and create a permanent shoreline for the resort is almost as overwhelming as the plans for the world-class Pointe community.

“Sixteen million cubic yards rolls easily off the tongue, but . . . it equates with a line of loaded dump trucks stretching from here to San Francisco,” he said.

‘One of the Best’

“We’ve said more than once that if we had wanted a resort, they certainly would be the developers we would choose,” Butterfield explained. “They are decidedly one of the best.”

Gosnell, 43, has long since handed over his Pointe San Diego pursuit to other development corporation executives, but during those early days he tooled around South Bay in his El Camino pickup, usually wearing a wrinkled jump suit, meeting the people who mattered and preaching his dream.

His meteoric rise was a mix of hard work and luck, according to resort industry colleagues. Gosnell, a Phoenix native, parlayed a local contracting company into a multimillion-dollar corporation by betting against the odds and creating a resort surrounded by corporate office buildings and homes.

This work-and-play combination turned out to be a winner that has spawned two other Pointes in the Phoenix area--a combined $750-million investment in 2,000 resort suites, 15 restaurants, 11,000-square-feet in meeting space, 20,000 employees and nearly $7.5 million in tax revenues. He had proposed to make an equal investment in San Diego’s South Bay in a community patterned after his Phoenix-area Pointes.

The most recent effort to resurrect the Pointe proposal came in February when a local group called Friends of Sweetwater Lake asked the authority to reconsider taking an in-depth look at the Pointe offer to improve the reservoir and enhance the water supply--at no cost to the water district. The group’s spokesman, Dennis Sumwalt, said the offer--with no strings attached--would allow the authority to select an impartial geotechnical engineering firm to determine once and for all whether the reservoir would be damaged or enhanced by the proposed Gosnell project. The cost of the study would be paid, in full, by Gosnell.

Independent Study Offered

“It’s our contention that a good proposal was made and that it probably wasn’t looked at thoroughly enough by the board,” Sumwalt said. “Let’s at least have an independent engineering study made to determine whether this project is worthwhile or whether it is risky.”

The authority reaffirmed its disinterest in looking into the Pointe proposal but offered a concession to Friends of Sweetwater Lake by instructing Butterfield to assemble a summary of the Pointe-authority talks and the basis for the water board’s position against further study of the project.

Sumwalt said he hopes that when the staff report is completed, Sweetwater Authority board members will realize the error of their ways and agree to take a hard look at the Pointe proposal.

Butterfield doubts that Sumwalt’s hopes will be realized.

“The board feels as though it would be used against them later if they went ahead with the engineering survey (at Pointe expense) when they have no intention of approving the project (to reshape the reservoir),” Butterfield said. “If, in the end, after an exhaustive engineering survey, the board still says ‘no,’ then they (Pointe officials) can come back at us and say, ‘You led us down the primrose path. You allowed us to spend hundreds of thousands of dollars and then turned us down.’ ” Butterfield explained. “This is the hardball league, and we just don’t want to play.”

Ric Williams, Pointe spokesman in San Diego, does not want to start another public debate with the water board. He just wants them to change their collective mind and allow the Pointe project to proceed with its massive development--a clone of the most successful of Gosnell’s three Phoenix communities with a mix of recreational, industrial, commercial office and residential construction surrounding the imposing resort centerpiece.

One water board wag suggested that Pointe officials should just give the $30 million-plus offered the authority in incentives as cash, allowing the water board to “go out and build another reservoir,” leaving the present receding waterline of Sweetwater Reservoir to the Pointe.

But on that point, both sides agree. There is no other South Bay site for another reservoir and there is no other South Bay site for a Pointe Resort.