Dana Point Studies Plan to Buy Headlands : Property: City officials may ask residents to vote on a bond measure to purchase some or all of 125 acres of prime coastal real estate. The land could cost $1 million an acre.

This could become the third city in South County to test whether a two-thirds majority of voters would be willing to tax themselves to buy land for open space.

In this case, it’s one of the prime pieces of coastal real estate left in Southern California.

With a massive development proposed for the Headlands, a 125-acre promontory overlooking Dana Point Harbor, city officials are considering a local bond measure to buy a portion--perhaps all--of the property. It could cost more than $1 million an acre.

Bill Walter, a local real estate agent who has fervently criticized the proposed hotel-commercial-residential complex at the Headlands, is among those encouraging officials to embrace the bond idea.

“This is the last significant piece of property left in Dana Point . . . and our last chance to get some real park space,” Walter said. “I think the people of Dana Point need an opportunity to have a shot at this.”

It’s up to the citizens, said City Councilwoman Eileen Krause.

“If there is an interest among the citizens for something like this, why not pursue it?” Krause said.

For historical and environmental reasons, the picturesque, privately owned Headlands has become a cause celebre in this otherwise laid-back beach community.

The rallying cry “Save the Headlands” now adorns bumper stickers, T-shirts and shop windows in all corners of town and has even penetrated Dana Hills High School, prompting teen-agers to join the protests against development plans at recent City Council meetings.

The beloved image of an undeveloped “Headlands” dates back to 19th-Century author Richard Henry Dana, who toured the California coastline in the 1830s and remarked on the beauty of the local bluffs in his records of those travels called “Two Years Before the Mast.”

Since the mid-1940s, the Headlands have been owned by the Newport Beach-based M.H. Sherman Co. and Chandis Securities Co.

A few months ago, the company proposed a development project that includes a 400-room hotel, 12.8 acres of commercial property and 521 homes that would encompass most of the Headlands.

The proposal has sparked heated opposition, particularly from members of a grass-roots group, Save the Headlands.

Citing the environmental significance of the property and potential traffic and grading problems, the group has demanded that the development be scaled back to a maximum of 295 residences and the commercial acreage cut to five acres.

Although the group is promoting a bond measure to buy the property, it wants the City Council to first push hard to negotiate as much open space as possible from the developer, said Toni Gallagher, one of the group’s leaders and a director of the Capistrano Bay Park and Recreation District.

The city should get what free land it can from the developer before local residents seek to buy it, Gallagher said.

“My only fear with a bond issue is that it could take the council off the hook,” Gallagher said. “If there is going to be a bond issue, (the council) might not work as hard” to obtain property.

For the first time in a decade, bond advocates are optimistic about winning enough voter support.

Since the passage of the tax-slashing Proposition 13 in 1978, which required a two-thirds majority vote to pass general obligation bonds such as the one proposed for the Headlands, bond measures typically have been defeated.

Three two-thirds bond measures proposed by Orange County school districts failed in the past decade, and a countywide transportation measure, which only needed a 50% vote to win, failed in its first try.

But recent successes in Laguna Beach and San Juan Capistrano have raised the hopes of bond supporters in Dana Point. During the past three years, voters in both communities have overwhelmingly supported by more than two-thirds majorities the concept of buying raw land for its preservation as open space.

“I think people came to south Orange County to get away from congestion,” said Kenneth C. Frank, city manager of Laguna Beach, where 81% of the city’s voters approved a $20-million bond measure in 1991 to buy land in Laguna Canyon. “I think it shows people are willing to pay for the services they want from government, especially if they want to preserve the lifestyle they came here for.”

In San Juan Capistrano in 1990, city officials had a similar success when 71% of the voters approved a $21-million bond measure to buy 140 acres of agricultural land throughout the city.

San Juan Capistrano City Councilman Gary L. Hausdorfer said the general public has been educated recently on how these bonds are “wise investments.”

“People have become more aware today of their collective need to invest in things they think will better the quality of life in their community,” said Hausdorfer, who is credited with leading the way for his city’s bond measure. “People now know there is no Santa Claus who comes along and delivers these kinds of projects free.”

But would such a measure fly for the Headlands, where the value of the property could be well over $1 million an acre?

Ed Knight, Dana Point’s director of community development, said it would not be an easy task, but it definitely should be studied.

“My personal opinion is the city has to look seriously at this,” Knight said. “The first thing we need to do is gauge the interest for this kind of thing. That’s what Laguna did.”

City Manager David Elbaum will report to the City Council in the coming weeks on the idea of a bond measure for the Headlands. On Wednesday, a public workshop on the Headlands project will be held at City Hall.