Ground Battle : Tree Farmers Vow to Fight Edison’s Planned Rent Increase

Most mornings, red foxes can be seen darting through the Monterey pines at Lyon’s Christmas Tree Farm in Torrance, an eight-acre swath of green sandwiched between oil storage tanks and an office and warehouse complex.

Such sylvan scenes, however, might soon come to an end.

Southern California Edison, which owns the property, wants to phase in a rent increase that eventually would raise the tree business’s annual payments from $8,000 to $190,000--the amount Edison figures it could charge if the land were used to store motor homes. And Lyon’s, rather than face the more than 20-fold increase, says it may have to close its Torrance tree farm.

“We have a nice business, but it has to be a profitable business,” said Dudley Gray, co-owner of the tree farm and 11 others in Los Angeles and Orange counties. “We can’t afford to run it as a hobby.”

Scores of other tree farms and wholesale nurseries using Edison rights of way in the Los Angeles area also face substantial rent hikes, though none is expected to be as high as the one affecting Lyon’s. Edison says the new charges, part of an effort to generate more income from its rights of way, are needed because the rent money helps keep utility bills down.

But the move alarms many of the roughly 450 nurseries and tree farms that use cheap Edison rights of way, particularly those in high-rent Los Angeles and Orange counties. If a large number of these businesses are forced to close or move elsewhere, they say, prices for Christmas trees and wholesale greenery could climb.

“It’s an increase in the cost of doing business at a time when we’ve gone through a terrible freeze, a fifth year of drought and a national recession,” said Ralph Klages, a nurseryman in Monterey Park who is president of the California Assn. of Nurseries. “I mean how many more hits can you take?”

Edison began renting out right of way property more than 20 years ago. Since the goal was to find tenants who would keep the property clean and secure--thus cutting down on the company’s trash-hauling and security costs--rent was minimal, in some cases less than $100 per acre per year.

And since Edison needed tenants who would not hem in transmission towers and other utility facilities with development, nurseries and Christmas tree farms often fit the bill. Though most of the rights of way--about 6,400 acres--are land used as pasture and for livestock grazing, about 2,500 acres are used by the nurseries and Christmas tree farms.

But rising real estate values have changed the equation. With demand for right of way property intense, Edison officials say they have begun trying to take advantage of that trend by raising rents, mainly in the urban areas where the nurseries and tree farms are.

In Long Beach, for instance, a tree farm has been forced to relocate because Edison wants to rent the land out for shipping container storage. A Lyon’s tree farm in Commerce, meanwhile, is being closed to make space for a card club parking lot--a change that will boost the annual rent to $20,000 an acre from the current $1,500, Edison says.

“We’re trying to get a fair market return,” said David Armes, manager of Edison’s land services division.

Most of the Edison rent increases are far less than the 20-fold boost affecting Lyon’s Torrance tree farm, company officials point out. Since the Torrance parcel does not have utility towers on it, they say, its value--about $7.5 million--is well above that of other right of way land.

And the utility has sought to soften the effect of the increases by imposing them gradually over a period of years--a process, company officials say, that will be applied to the Lyon’s tree farm in Torrance.

“Ultimately, the value of this land is still a lot less than what you could lease adjacent private land for,” said Stephen Shermoen, also of Edison’s land services division. While complaints about rent increases have been numerous, he says, so far only one right of way tenant--Lyon’s Commerce tree farm--has closed outright.

Still, many nursery and Christmas tree farms using Edison land consider the rent increases steep. Edison says the prevailing annual rent in urban areas, now about $900 to $1,500 an acre, will rise to an average $2,500 an acre as each renter’s licenses are renewed.

“We don’t make that kind of money,” said Takashi Yasutake, owner of nurseries beneath Edison power lines in Torrance, El Segundo and Hawthorne. “I started 24 years ago at $100 an acre per year. Now, maybe I’ll have to find another location.”

Citing such concerns, some nursery and tree farm owners not yet subject to Edison rent increases are hoping to avoid the hikes. In the South Bay, Peter Serrato, owner of Peter’s Garden Center in Redondo Beach, says he plans to hire a lawyer to appeal to Edison for a break.

“All of a sudden Edison comes and knocks you for a loop,” said Serrato. “They’re choking us. Hopefully, I can beat them to it and write to them first.”

And Gray, hoping to spare his Torrance tree farm, is attempting to draw attention to the red foxes. The animals have dens on the nearby oil tank complex and hunt on the tree farm for food. Should the tree farm be closed, he contends, the foxes will have a hard time surviving.

He says he will raise this and other issues with Torrance officials to prevent Edison from turning the land into a motor home storage site.

“We’re not going to walk away without a fight,” Gray said. “I can’t conceive of the city letting another use in there.”