Balance High Bid, Best Use

Faced with $4 billion in debt, the Department of Water and Power plans to sell off hundreds of acres of surplus land across Los Angeles. How those sales play out for the San Fernando Valley depends on how carefully DWP officials evaluate the parcels and on how aggressively they market them to appropriate buyers. The potential for huge benefits to the Valley is great as unused industrial land gets recycled as sites for new offices and factories. Likewise, though, the risk of environmental tragedy runs high.

Of the more than 400 parcels owned by the DWP in Los Angeles, 139 sit in the Valley. About 60 of those have been identified as surplus, although more may be added as the agency struggles to reduce its costs. Among the Valley sites: Chatsworth Reservoir and the Northridge Metrolink station as well as scattered parcels of vacant land from Sylmar to Woodland Hills. Obviously some of the parcels hold the potential to generate steady streams of cash.

Already, the agency plans to hire a real estate firm to help sort out the merits and possibilities of various properties. Particularly with environmentally sensitive sites such as the Chatsworth Reservoir, the DWP must get the public involved in planning for future uses. The highest bid for a property may not lead to the best use.

For instance, environmentalists want the 1,318-acre Chatsworth reservoir preserved as open space. Its undisturbed grasslands and ponds attract geese, heron and other wildlife. Maintaining the land as a wild park would preserve one of the few natural spots left on the Valley floor, giving residents an idea of how the region looked before the intrusion of freeways and malls. But as such things usually go, the land could also be a beautiful setting for new homes or a developed park complete with playing fields and playgrounds. On certain levels, the different uses can coexist, but each additional home site or baseball diamond destroys a disproportionate piece of natural land.

Disposing of purely industrial land should be less problematic. Parcels in the northeast Valley, for instance, already are coveted by business owners planning to expand or move into the area. In Pacoima, industrial vacancy rates hover at 3%. Opening up more land--already piled with the heavy equipment associated with a utility--to private enterprise energizes the local economy. And as the DWP considers swapping some of its excess space, the opportunity exists for creative deals that both expand city services and reduce costs.

Whether the DWP’s sales help or hurt the Valley depends in large part on how involved the agency asks the public to be. The DWP’s motivation for the sales is to improve its financial position. But a community rarely bases its vision of the future purely on cash flow.