VENTURA : Port Commissioners to Discuss Settling Harbor Village Suit

Ventura Port District officials will meet privately tonight to pursue an end to multimillion-dollar litigation involving a long-standing dispute with the Bank of America over Ventura Harbor Village.

At stake is about $9 million in damages, as well as management of the village, said Lawrence L. Matheney, Ventura Port District Commissioner.

The Port District, which owns the land around the harbor, is acting as both landlord and lessee of the disputed property, administering it through a management company.

Richard Parsons, Port District general manager, along with Port District attorney H. Jess Senecal, met with Bank of America attorneys and managers Monday.

Two-thirds of Ventura Harbor Village is involved, including about 200 boat slips--most of the harbor’s commercial slips--which generate $800,000 annually. Also in question are an ice plant, boatyards, a fish-receivingfacility and half of the 100,000-square-foot retail village of restaurants and shops.

The village was built in 1981-1983 by Ocean Services Properties and financed by certificates of participation sold in the Port District’s name. They were secured against the wharf facilities built by Ocean Services.

The certificates were originally purchased by individuals, pension funds, mutual funds and investment groups. The bankruptcy by Ocean Services left investors with claims against the property, and the Bank of America is serving as trustee for many of the investors.

At issue is how much investors deserve.

“We agree with the bank that $6.5 million in principal was outstanding when the certificates went into default in 1987,” Parsons said. “But how do you calculate subsequent interest accrued?”

Bank of America started out demanding $12 million, with the Port District offering $7 million. Now both are somewhere in between, having been encouraged by Ventura Superior Court in a recent settlement hearing to work toward a $9.2-million compromise.

Complicating the negotiations is the presence of another creditor. Great Western Bank foreclosed and took over three clusters of retail buildings that it held as collateral.

Security Pacific Bank foreclosed on the rest of the project. Security Pacific, after managing the property for about a year, walked away from it in the fall of 1988, writing it off as a bad debt and losing, according to estimates by Port District officials, about $4 million.