Porter Ranch Pact Called Developer’s Way of Skirting Fees

Critics charged Monday that a special agreement for the huge Porter Ranch project would let developer Nathan Shapell bill future homeowners for the multimillion-dollar cost of public improvements that the developer agreed to install when he was given permission to build.

“It’s a deception that Shapell’s giving the city a big gift,” said Walter Prince, the leader of a homeowner group critical of the 1,300-acre project in the northwest San Fernando Valley.

“He’s just going to pass on the costs to the homeowners,” Prince said. “If Shapell’s not giving anything, then why should the city be giving him anything” by approving the special development agreement?

The Planning Department recommended a week ago that the city enter an agreement with Shapell, promising that the city would not interfere with development plans in Porter Ranch for 20 years. In exchange, he agreed to install additional public improvements beyond those to which he committed a year ago.

At that time, the Los Angeles City Council approved a Porter Ranch Specific Plan that permits up to 3,395 residences and 6 million square feet of commercial-retail space. During the heated council debate on the project, the developer and his chief legislative sponsor, Councilman Hal Bernson, repeatedly stressed that approval would result in a bonanza of $100 million in public improvements to be built by Shapell.

The original improvements range from street construction and installation of computerized traffic signals throughout the northwest Valley to construction of a fully equipped fire station.

Under the new agreement, which Shapell wants as a hedge against the possibility that a future City Council might decide to renege on agreements made by the present council, the developer agrees to pay $2 million toward the cost of building a bridge over Aliso Canyon.

The bridge would connect Porter Ranch to points east, such as Granada Hills and the Santa Clarita Valley.

The Los Angeles Planning Commission is scheduled to review the new agreement at a public hearing Thursday.

The proposed agreement could allow the developer to establish a benefit assessment district under the auspices of the state Mello-Roos law.

That law allows landowners--with the permission of local jurisdictions--to vote to finance local public improvements with bonds paid off by taxing their own properties. Currently, the only landowner is the Porter Ranch company.

If homeowners were not taxed later through a Mello-Roos assessment district, the alternative is for them to pay for the improvements upfront in the cost of the houses they buy, said Paul Clarke, spokesman for Porter Ranch.

One way or another, the cost of the improvements will be passed on in the “cost to homeowners, tenants--that’s simple economics,” Clarke said. “I wonder what school these people went to that they would believe the costs would not be passed on.”

Donald Worsham, the secretary of PRIDE, the homeowner group headed by Prince, said his organization has “serious concerns” about the agreement because it seems to allow the Porter Ranch Development Co. to “recover every penny it spends on infrastructure improvements.”