Fervor Walks, Money Talks, Laguna Learns : Preservation: The city prepares to ask for a tax raise of $20 million in a bid to prevent development of Laguna Canyon.

When 8,500 marchers descended on Laguna Canyon in November to oppose to a large housing development planned for its rolling hills and steep slopes, the surprising show of solidified protest was more than even organizers had hoped for.

Protesters came from throughout Southern California, forming a human chain a half-mile long, a stunning turnout that lent credence to the environmentalists’ view that Laguna Canyon is more than just a local concern.

In the face of such overwhelming public sentiment against its 3,200-home Laguna Laurel development, Irvine Co. officials--who had previously been quick to dismiss the opposition as an environmental fringe--suddenly changed course and agreed to give Laguna Beach a chance to look at ways to buy its treasured canyon.

But now that the euphoria has died down, and other options have been exhausted, Laguna Beach residents are facing the one alternative they had tried to avoid: digging deep into their own pockets to save the canyon.

Last week, after learning that county aid would not be forthcoming, the City Council voted to put a $20-million local bond measure on the November ballot--one that would increase property taxes for Laguna Beach residents to help pay for buying the canyon.

It was the latest twist in a decadelong battle by Laguna Beach residents and local officials to protect the village-like atmosphere of their city from the rapid development that has swept much of the county. Key to their efforts, they say, is the maintenance of a large buffer of undeveloped land surrounding the city, often referred to as the Laguna greenbelt, to fend off tract homes and shopping malls.

Over the years, environmentalists have used varied tactics to block the 2,150-acre Laguna Laurel development, from picketing Irvine Co. Chairman Donald L. Bren’s home to filing lawsuits alleging that the company’s environmental impact studies are flawed.

Shortly after November’s march, Laguna Beach officials tried to sell neighboring Irvine on the idea of accepting the project within its borders. But Irvine rejected the proposal, and in a final insult, former Mayor Larry Agran likened Laguna Laurel to a “garbage barge of a project in search of a port.”

Undaunted, Laguna Beach urged county supervisors a few months later to consider a countywide bond issue to pay for buying the canyon for a state park. But that proposal died when poll findings showed a clear lack of public support for the measure.

Now the canyon’s fate is back where it began: squarely in the hands of Laguna Beach residents. And several key questions remain unresolved as the city prepares to ask residents for permission to raise taxes by $20 million:

* How much is the Irvine Co. property really worth? In the past, company officials have tossed about a “ballpark” figure of $100 million, with environmentalists arguing that the value is much lower.

* The proposed bond measure, which would raise $20 million over 20 years, falls far short of the company’s stated selling price. Where does the city plan to get the rest of the money? City officials have talked about county and federal money that might be available, but efforts to tie up either have been futile.

* What happens if a bond measure passes but the city cannot raise the rest of the money?

Supporters of the measure acknowledge that they are a long way from answering all the questions before them.

“All I know is, it’s very important for this bond measure to be successful in Laguna Beach, so we can say we are putting our money where our mouth is,” said Gene Felder, vice president of the Laguna Canyon Conservancy. “Whether or not we’ll receive any help in saving Laguna Canyon from the rest of the county remains to be seen.”

Irvine Co. officials who have given Laguna Beach until November to raise the money would not comment on their plans once the deadline expires.

“Obviously,” company spokeswoman Dawn McCormick said, “the ballot measure does not raise enough money to buy the whole parcel, so there has to be a realistic plan to finance the rest of it.”

Laguna Beach officials point to San Juan Capistrano, where a bond issue was passed to save a greenbelt, as proof that voters will pay for land preservation. In April, San Juan Capistrano residents voted to set aside $21 million over 27 years to preserve parklands. But there, $21 million was the total cost for 140 acres, while the $20 million Laguna Beach hopes to raise is just one-fifth of the price of 2,150 acres in Laguna Canyon.

Even ardent preservationists are worried about where they will raise such a staggering sum. “It looks like it’s coming down to Laguna Beach,” said Laguna Canyon Homeowners Assn. President Sandy Lucas, “but we’re going to be depending on a lot of people outside Laguna Beach to donate money.

“The beaches are full of people from Anaheim, Yorba Linda and Brea who use Laguna Canyon, and if they are going to continue to use it, they’ll have to help pay for it.”

The city has opened a fund to receive private donations to buy the canyon. So far, Mayor Lida Lenney said, $570 has been raised. Despite unfavorable odds, canyon preservationists remain optimistic.

“Before,” Lenney said, “we were feeling that the whole thing was being steamrolled along, and we couldn’t stop it. Now, we are into the realm of reality in working out a deal with the Irvine Co.”