Laguna, Irvine Co. Agree on Canyon Deal

The city and the Irvine Co. have negotiated an historic agreement that will allow Laguna Beach to begin buying 2,150 acres of Laguna Canyon for $78 million.

The pact, scheduled to go before the City Council on Tuesday, would set in motion the preservation plan for one of the last undeveloped coastal canyons in Southern California. The plan is based on an agreement in principle reached last October by the city, the company, environmental groups and Orange County officials.

In a related plan still under development and subject to approval by the Orange County Board of Supervisors and other agencies, the county will contribute $10 million toward the price of the land known as Laguna Laurel.

The county also will receive part ownership of the parcel, and manage what would effectively become a 15,000-acre regional wilderness park that would include Laguna Laurel and surrounding open space.

The latest round of negotiations to transform last fall’s three-page “handshake” agreement into a legal document tested the will of all parties to finalize the pact.

While the final agreement includes concessions on all sides that were not part of the original plan, City Manager Kenneth Frank, who negotiated on behalf of the city, stated in a memo to the City Council that the pact “embodies the concepts agreed to in October.”

Among the changes:

* Initially, the city will receive 400 acres less than anticipated after making its first $33-million payment June 30. The additional land will be set aside in case the San Joaquin Transportation Corridor is built and the alignment changes to meet environmental concerns. Parcels not used in that project would return to open space.

* In exchange, the Irvine Co. has agreed to cut $4.6 million from what could have been about $8 million in additional fees owed by the city in the second-through-fifth years of the contract. Also, the company has added 10 acres of property next to Laurel Canyon that was not part of the original land package.

* The proposed “regional greenbelt park” surrounding the city of Laguna Beach would bring together open space owned by different government agencies but would be managed by the county. Riding and hiking trails would connect the Laguna Laurel site to the county’s Aliso/Wood Canyons Regional Park, the Sycamore Hills property owned by the city, Bommer and Shady canyons in the city of Irvine, Crystal Cove State Park and Irvine Coast open space owned by the company.

* In an attempt to collect as much money as possible for the purchase, the city would transfer ownership of 84 acres to the state Department of Fish and Game in exchange for $4 million, which would become available in October.

An advisory group made up of representatives from the state, county, the cities of Irvine and Laguna Beach, and citizens would oversee policy issues relating to management of the park.

Negotiating team member Paul Freeman, who was hired by the Irvine Co. during the recent round of talks to act as liaison with all parties, said partial ownership of the land by other entities helps Laguna Beach raise needed money without compromising the basic goal: to keep the area as open space.

“Probably what you will have five years out is a checkerboard ownership with an integrated management plan, so that if someone comes up with the money, they are going to end up with a piece of the rock,” Freeman said Friday.

Most of the first $33-million payment will come from a $20-million bond issue approved by voters last November and also scheduled for a council vote Tuesday if the purchase agreement with the Irvine Co. is approved.

The city also plans to sell another $5-million bond package that would be backed by parking meter revenues, and spend $4 million in state park funds already received.

The county’s $10 million is expected to be paid out in four annual installments, with the first $2.5 million due by the first June 30 payment deadline. A private fund-raising campaign is already under way to help raise part of the $1.5-million balance due the first year.

As with the original agreement, if the city defaults on its payments, the Irvine Co. retains the right to proceed with its proposed 3,200-unit Laguna Laurel development. However, a new feature of the plan allows Laguna Greenbelt Inc., an environmental group, to take over the purchase if the city cannot meet the last payment due in 1995, provided the group has $10 million “in immediately available funds.”

Environmental groups were scheduled to review the agreement this weekend. Greenbelt President Elisabeth Brown said that while her board has not reviewed the final draft and was concerned about a couple of issues still unresolved Friday, she did not believe “there are any deal-breakers left.”

The San Joaquin Transportation Corridor became a key issue as talks progressed, committee members said privately.

Environmentalists and Laguna Beach officials, who are opposed to the transportation project, wanted to make sure that the final document did not facilitate the corridor. But the Irvine Co. and the county also wanted to make sure that the project was not killed, negotiators said.