Collateral Put Up for Olympic Training Site : Sports: The nonprofit foundation building the complex in Chula Vista offers the property in exchange for $15-million loan from state.

Capping months of negotiations, a nonprofit foundation building an Olympic training center in Chula Vista has signed a formal agreement putting its property up as collateral for a controversial $15-million state loan to help build the sports complex.

Documents signed earlier this month and released Wednesday by the California Department of Commerce would allow the state to take title to the training center site along the western shore of the Lower Otay Reservoir if the San Diego National Sports Training Foundation fails to repay the loan with interest.

Both sides were forced to come up with the security agreement after newspaper reports last June that their original deal for the $15-million loan, approved in concept by the Legislature, contained no provisions for collateral. Jack Stewart, chief deputy director of the Department of Commerce, acknowledged that the “very unusual” unsecured loan could mean that the state would lose its money if the foundation went out of business or simply decided not to repay its obligation.

The disclosure angered several lawmakers, who were in the midst of a bitter budget battle that inflicted deep cuts in social programs. The furor prompted state administrators and foundation officials to begin renegotiation of the terms of the loan in September.

“If everybody feels more confident with the collateral agreement, we’re happy we did it,” Stewart said Wednesday. “I’m very happy we were able to comply with the wishes of the Legislature.”

The new agreement grants the state a deed of trust for the 154-acre training center site. The land, valued at about $20 million, is being donated by EastLake Development Co., a partnership that includes the politically powerful J. G. Boswell Co. agribusiness firm based in Los Angeles.

David Nielsen, the foundation’s executive vice president, said Wednesday that construction should start later in the week on the complex, which is expected to include 1.5 million square feet of outdoor playing fields, as well as 250,000 square feet of dormitories, eating facilities, storage rooms and gymnasiums.

To help with the construction, which is scheduled to be completed in late 1992, the state has agreed to loan the foundation $5 million a year for the next three years. Foundation officials say they will pay that back with interest out of the sale of special Olympic training center license plates, which cost $132 a set.

If the foundation fails to make good on its obligation, the new agreement now gives it legal recourse by assuming title to a rightful share of the land and the buildings at the center, Nielsen said.

The state gets an amount equal to whatever is owed them, Nielsen said. “Our position from the point in time of the issues were raised is we want to be responsive to the issues of the Legislature, and we’ve done that to the best of our ability.”

Stewart said the foundation will receive about $1.4 million in state money within the next few weeks. The balance of the $5-million installment will become available to the foundation as it submits claims to pay for construction, he said.