Overflowing Land
The “For Sale” signs haven’t gone up yet, but at the Department of Water and Power, the calls come almost daily. Hotels, golf courses, studios, parking lots--the list of proposals for surplus DWP land keeps getting longer.
In coming weeks, the DWP will hire a major real estate company to handle its planned sell-off of surplus landholdings in the Los Angeles area. Some of the bounty may be used to pay off the agency’s $4-billion debt for construction of plants that don’t produce power at what are now market rates.
The land sale coincides nicely with a superheated market for commercial and industrial land in Los Angeles, particularly in urban areas where vacant lots are scarce, DWP officials say.
Developers “are even saying they will buy our [non-surplus] land and buy another place to move us to,” said the DWP’s Eric Tharp.
To balance budgets, the DWP hopes to raise $6 million per year in the next four years from land sales. But a single lucrative sale could well exceed that figure, said Frank Salas, executive assistant to the DWP’s general manager.
Although the agency has held land sales in the past, “the typical way we used to sell property was to put up a ‘For Sale’ sign . . . and the highest bidder would get it,” Salas said. “But now we need to be a lot more sophisticated about it.”
In the next few weeks, the DWP will select a real estate company to conduct a two-year analysis of real estate holdings and help peddle the agency’s land. The DWP may consider shutting down some yards now in use, or even swapping properties, to squeeze the last drops of cash from its holdings, Salas said.
The DWP owns more than 400 properties in the Los Angeles area. About 60 have already been identified as surplus, and others may be freed up as the agency lays off workers to cut costs, Salas said.
The DWP’s large holdings in the deserts and mountains of the Owens Valley probably will not be sold because they protect the watershed for the city’s water supply, he said. But other far-flung holdings, such as a railroad in Nevada, might be put on the block.
Because many of the DWP’s local properties are large and zoned for industry, they represent a rare opportunity in built-over areas of the city, said Rocky Delgadillo, Los Angeles deputy mayor for economic development.
Old maintenance yards could become homes for new or expanding companies, bringing jobs and income to the region, he said.
“DWP can increase its revenues, and at the same time the city can increase the impact on its local economy,” he said.
But the DWP also owns properties prized for other public uses. They range from a Metrolink station in Northridge to soccer fields in the East San Fernando Valley. Others are treasured by conservationists, and are largely protected by legal restrictions.
Still, the sale leaves open the possibility for conflict over private and public needs. Despite the agency’s hunger for dollars, “part of our mission is being sensitive to community concerns,” Salas said. “There will be a concerted effort to do that here.”
Perhaps the most politically charged DWP property is the mothballed Chatsworth Reservoir, a de facto nature preserve, coveted by sports leagues and eyed by developers who in the past have proposed housing and golf courses for the site.
Though no longer filled with water, the vast, concrete-edged reservoir in the northwest San Fernando Valley is covered with grass, shrubs and seasonal ponds. It was drained in 1969 for enlargement but was declared unsafe after the 1971 Sylmar earthquake.
Over the years it has become the focus of a long-frustrated preservation campaign, spearheaded by Los Angeles City Councilman Hal Bernson.
Bernson, a former businessman who said he is usually “not the greatest environmentalist,” has nonetheless worked to make preservation of the reservoir his legacy after two decades on the council.
The reservoir is a stopping place for migrating flocks of Canada geese. Yellow-eyed burrowing owls stalk through the grass. Visitors to the reservoir have been surprised by the sight of sleeping bobcats draped across the branches of massive oaks.
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But if nature is evicted, the DWP has estimated, the land value of the reservoir could be as much $50 million. “I think before we give away $50 million bucks, we better really understand what we are doing,” said Rick Caruso, president of the DWP board of directors.
Caruso said he recently called off the DWP’s negotiations with the Santa Monica Mountains Conservancy, which seeks to lease the reservoir and preserve it in its current state.
Before negotiations continue, Caruso said, he wants to know more about possible uses of the property from the real estate study, and about public attitudes regarding it.
Bernson thinks Caruso is stalling. The City Council voted earlier this year to direct the DWP to draw up a 10-year lease agreement with the conservancy. But while the council can override the DWP board votes once they happen, it can’t force Caruso or the board to act on a matter before the fact.
“I’ve fought for this [preservation of the reservoir] since I came to the council,” said Bernson, who is 67 and plans to seek just one more term. “I’d like to see it taken care of before I’m gone.”
Environmentalists, too, are aggravated that years of effort to save the reservoir have been blocked just inches from the goal.
“I am so angry that this is happening,” said Rosemarie White, who belongs to a preservationist group called the Canada Goose Project, “so angry that so many people have tried and given of themselves for this and it has stalled.”
Development of the reservoir may be difficult. The land is zoned for open space, and is designated a wildlife refuge in community plans. Santa Monica Mountains Conservancy division chief Rorie Skei said it’s also in the conservancy district, meaning the agency may be able to call upon its right of first refusal for land sales.
But land use designations, Caruso said, can change. Sports groups who have petitioned to use the land for ball fields represent a community interest with some political weight.
The 1,300-acre reservoir is so big that “there’s something in it for everyone,” Caruso said. “A substantial amount could be for open space. A nice amount could be for a more formal park . . . and probably there is some property that could be developed and provide income to the department.”
Other large DWP parcels on the current list of possible surplus properties include a 9-acre swatch of prime waterfront in Seal Beach, a Malibu plateau, a reservoir off Mulholland Drive in Woodland Hills and a broad stretch of the upper reaches of Big Tujunga Wash.
Seventy percent of the Seal Beach property is zoned for a park, and the rest could be used for a hotel development with stores, said Seal Beach City Manager Keith Till.
Already, the DWP has received a glossy packet full of plans for a hotel on the site, sent by a Florida developer, Salas said.
The Malibu property above Corral Canyon Road was once planned for a nuclear power plant. It is in the conservancy district, and will almost certainly remain open space, Salas said. And much of Big Tujunga Wash may be unsuitable for development because of steep slopes, a City Council deputy said.
Little stands in the way of sales of the majority of the DWP’s smaller surplus properties--urban lots and yards, full of pipes or trucks, parcels that duplicate operations nearby or stand empty behind chain-link fences, officials said.
“One of our big challenges is finding large properties for industrial users,” said Delgadillo, the deputy mayor. “DWP properties in industrial areas are significant. For example, those in Pacoima. There is a 3% industrial vacancy rate in Pacoima.”
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DWP’s Major Surplus Properties
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Site Acres Current Status 1. Chatsworth Reservoir 1318.0 Empty reservoir 2. Tujunga Galleries 129.7 Partly leased 3. Malibu Nuclear Power Plant Site 97.9 Undeveloped 4. Lakeside Debris Basin 68.8 Power line right-of-way 5. Pendleton Landfill 14.8 Vacant 6. Rose Hills Dump Site 11.4 Filled debris landfill 7. Seal Beach Generating Station 8.0 Demolished facility 8. Gerard Reservoir 5.9 Out-of-service reservoir 9. Lomita Pumping Station 5.6 Site wells to be abandoned 10. Northridge Metrolink Station 5.5 Metrolink regional station 11. North Hollywood Wells 5.2 Partly leased 12. Harbor Generating Station Site .8 Former storage area 13. Van Nuys Telecommunicating Shop .7 Unoccupied buildings 14. Records Center .3 Unoccupied building
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Source: Department of Water and Power
