Bond Would Buy Out Developers

The campaign for a massive statewide water bond measure is being bankrolled by developers who could reap hundreds of millions of dollars selling environmentally sensitive land to the state should it pass in November.

Donors, who have spent more than a million dollars to qualify and promote Proposition 50 since January, include owners of parcels linked to the Bolsa Chica and Ballona Creek wetlands who have been battling environmentalists over their plans for development for years, even decades.

Another is a Las Vegas land speculator who recently bought 2,000 acres of hillsides and rugged mountains above Malibu--land long coveted by the National Park Service and the Santa Monica Mountains Conservancy.

If approved by a majority of voters, Proposition 50 would let the state issue $3.4 billion in bonds to restore coastal wetlands and watersheds and expand drinking water supplies.

About $750 million of that could be used to buy coastal parcels, with the Bolsa Chica mesa in Huntington Beach specifically cited in the proposition.

Other regions mentioned as priorities are the San Francisco Bay Area, the Santa Monica Mountains and Baldwin Hills near Culver City.

Officials with four development companies either did not return telephone calls or declined to comment on their donations to the pro-Proposition 50 campaign.

However, a Southern California developer who asked not to be named said, “It makes perfect sense: All those projects are being tormented; if you don’t want us to build, buy the property.”

No serious opposition has emerged to the measure, apart from the routine objections of anti-tax groups.

Preservationists, environmental activists and residents concerned about development in their midst are ecstatic at the prospect of preserving so much coveted land.

Some, however, are wary of developers’ involvement.

“The foxes are clearly in the henhouse on this initiative,” said Mark Massara, coastal programs director for the Sierra Club.

“These guys are obviously working to enhance their own bottom line and profit on this real estate speculation,” Massara said.

“[But] as someone who fights all these battles, it’s cheaper to buy [the lands] now than spend the next 25 years fighting.”

The bond measure--backed by the Nature Conservancy, the National Audubon Society, the Planning and Conservation League and others--is aimed primarily at raising billions of dollars to increase and safeguard drinking water supplies.

That is also a vital issue for developers, who under state law now must identify a water supply for their projects.

Soliciting Support

Ballot measure organizer and lobbyist Joe Caves said that he has talked to developers about supporting the measure and has told them, “If they want to have the option of [their land] being purchased by the state, these bonds have to pass.”

As of July 31, Playa Capital has given $830,000 to the measure’s primary backer, the Conservation Action Fund.

The company is building a 1,087-acre development near the Ballona wetlands on Los Angeles’ Westside. Attempts to reach officials familiar with the contribution were unsuccessful.

Brian Sweeney, who recently bought the scenic land above Malibu, has contributed nearly $25,000 to the California Conservation Campaign, another key Proposition 50 backer. Through his attorney, he declined comment.

Rep. Sam Farr (D-Carmel) has accused Sweeney of “environmental terrorism” because he has a history of buying land, securing development rights and then selling the land to the state and nonprofit groups for many times what he paid for it.

The Irvine Co. donated $30,000 directly to the “Yes on 50” campaign, and gave an additional $55,000 to the Conservation Action Fund.

The San Juan Co., an affiliate of Rancho Mission Viejo, also gave $50,000 to “Yes on 50.”

Developers Benefit

Neither of the two major Orange County landholders appears to have property that would be acquired using bond funds. But they, like all developers, would benefit from new sources of drinking water. Also, both companies historically have been active in state and local politics.

“We report our contributions, [but] as a matter of policy, we don’t publicly discuss them,” Irvine Co. spokesman John Christensen said.

Bixby Ranch Co. of Seal Beach has contributed $20,000 to the California Conservation Campaign.

The state has targeted 181 acres of wetlands it wants to buy from the company, and anticipates chipping in $14 million for part of the cost.

No funding source has been identified. The company did not respond to requests for an interview.

Signal Landmark, which owns the Bolsa Chica mesa, has donated $350,000 to both the Conservation Action Fund and the California Conservation Campaign.

“As a company, we’ve got a long track record of supporting good public policy,” said Lucy Dunn, executive vice president of Hearthside Homes, Signal’s sister company. Dunn declined comment on the acquisition issue.

Although it appears that landowners who could sell their environmentally sensitive property are backing the measure, developers are not of a single mind about Proposition 50.

“In the building and development industry as a whole, folks are coming down on all sides,” said David Smith, legal counsel for the Building Industry Assn. of Southern California. “While Prop. 50 does make some provision for [drinking water] supply, it avoids the long-term storage [reservoir] issue.”

Bill Fulton, a regional planning consultant who publishes the California Planning and Development Report newsletter, said the support of certain developers is to be expected.

“It’s the simplest way out in lot of cases,” he said. “The emerging solution in the last couple of years is to buy your way out of [the] problem. The question is where the money comes from. ... You don’t have to be a genius to figure this out.”

Repeated Challenges

He cited the Bolsa Chica example. Developers originally proposed a marina, hotel and as many as 5,700 homes in the late 1970s. That plan and several others have been approved by county and state agencies, only to be scaled back after repeated environmental legal challenges.

Today, the struggle is over the remaining 230-acre mesa overlooking the wetlands. The company’s latest proposal to build as many as 1,235 homes is tied up--both in a court fight and before the Coastal Commission.

The mesa is the sole parcel Proposition 50 mentions by name as a priority for acquisition.

“If you’re Bolsa Chica, you’ve got to be tired of [fighting],” Fulton said. “No matter how much rhetoric they give about wanting to build, most landowners just want their money. That’s why they’re willing to give.”

In the last two years, California voters have passed three environmental bond measures totaling $6.7 billion. A June poll by the nonpartisan Public Policy Institute of California indicates that Proposition 50 is headed for approval in November, with 59% of registered voters favoring it and 29% opposed. The remaining 12% are undecided.

Taxpayers’ groups question the wisdom of creating additional debt when the state has a nearly $24-billion budget deficit.

“While the goal may sound worthwhile, the [bond] ends up benefiting certain special interests disproportionately,” said Kris Vosburgh, executive director of the Howard Jarvis Taxpayers Assn. “Follow the money.”

That’s also a concern of some in the environmental community.

“Of course they all see it as a payday for them for their speculative developments,” said Marcia Hanscom, executive director of the Wetlands Action Network, which has yet to take a position on the measure.

Some local activists endorse the measure, developer financing and all. Paul Arms, a board member with the Bolsa Chica Land Trust, said he was thrilled that the owner of the mesa is backing a measure to help the public buy and preserve the land.

“Their help is very much appreciated,” Arms said. “I look forward to popping a bottle of champagne with them once it gets purchased.”