Prices Threaten Ballona Plans

Spiraling real estate prices could jeopardize the state of California’s plan to purchase and restore a large segment of Los Angeles County’s last significant wetlands, according to developers who would give up their bid to build on the land.

The state’s acquisition of about 500 acres of the Ballona Wetlands near Marina del Rey, already a year overdue, recently was delayed again when state officials sought yet another estimate of its worth. The bureaucrats said they were wary of overpaying for the property, a swath of coastal scrubland that has been severely degraded by decades of farming and urbanization.

Roughly 200 acres in and near the wetlands already have been protected by a previous legal agreement with the developer of the massive Playa Vista project. But the bulk of the wetlands area sought by the state still hangs in the balance.

If the state can’t buy the land, Playa Vista executives may pursue plans for thousands of additional apartments and condominiums near Lincoln Boulevard. Environmentalists counter that the developer is simply posturing and would rather sell the land than face a decade-long political battle to secure the right to pursue additional development.

Conservationists and the developer have thrown around wildly divergent estimates for the value of the land, from as little as $10 million to as much as $500 million. Environmentalists hope the latest appraisal will shrink the price tag, which recently has been rumored to hover around $135 million. But representatives of the developer say the appraisal will show just the opposite: that Southern California’s booming housing market has driven the price higher.

State officials and the land trust working to broker the deal remain optimistic that it will still happen.

“We believe we will complete the negotiations by the end of this calendar year,” said California Resources Secretary Mary Nichols. “The sellers always think the state is taking too long, and the state does take a long time compared to private parties. But these are taxpayer dollars, and although we think this is in the public interest, we have to make sure that it’s a fair deal.”

Reed Holderman, California director of the Trust for Public Land, struck the preliminary deal with Playa Vista.

“The way I see it, we have one more chance to make this work,” Holderman said. “If it doesn’t work after this, well, we’ll have to go our separate ways.”

Playa Vista representatives also say they remain committed to the sale.

“Twenty months ago, when I took this job, I told them I would honor the spirit of this agreement to make this happen, and that is what I am doing,” said former mayoral candidate Steve Soboroff, now Playa Vista’s president. “There is still unanimity among everyone involved to try to do this.”

But some environmentalists are worried that precious momentum is being squandered. They have begun wondering aloud whether Gov. Gray Davis’ administration truly supports the deal.

Though conservationists have sparred over numerous aspects of the development over the years, more than 20 groups recently signed a letter urging the state to close the deal as soon as possible.

Privately, meanwhile, some Playa Vista representatives say the development’s investors are increasingly losing patience, noting the money they could make by building on at least some of the land.

“My main fear is that people will look a gift horse in the mouth,” said Ruth Lansford of Friends of the Ballona Wetlands, a group that has been fighting to save the site for more than two decades. “Right now a lot of the pieces are in place. The political will is there.

“People say this land isn’t worth that much because it can’t be developed,” she added. “That may be true right now, but it may not be true in a few years. It certainly could be developed back when George Deukmejian was governor. Who knows if [rumored future gubernatorial candidate] Arnold Schwarzenegger wants to save wetlands?”

The Ballona Wetlands once stretched over a wide swath of what is now the Westside, and for the last quarter-century, environmentalists have made a passionate stand to save meager remnants of the marsh from being entombed under pavement.

In the process, generations of environmentalists have filed a string of lawsuits and staged innumerable protests to block development plans for the 1,087 acres between Los Angeles International Airport and Marina del Rey, where billionaire Howard Hughes built the Spruce Goose flying boat.

While builders have completed the first phase of Playa Vista and the first residents have moved in, conservationists have squabbled among themselves over some of the settlements and concessions made on the project.

Playa Vista has now pledged to turn over a total of 500 acres to the state. And city voters helped pass statewide bond issues that were supposed to cover the purchase price. They include last year’s Proposition 50, which contained $300 million for projects in L.A. and Ventura counties.

California officials initially predicted that they would buy the land within a year. The latest appraisal -- the seventh overall, according to the developer -- will probably delay the deal for three to six more months.

“Obviously, we don’t want to overpay,” said Al Wright, director of the state Wildlife Conservation Board, which is overseeing the purchase.

Some of those involved in the deal said the state has become more cautious about high-priced open-space acquisitions since it was bombarded by negative publicity for the $100-million purchase of the Cargill salt ponds along San Francisco Bay.

Newspapers criticized the state-federal Cargill deal after it was disclosed that the price was based on an outdated appraisal, which assumed that San Francisco International Airport would expand its runways, a project that has been put on hold. (The appraisal, as is customary, was not made public until after the purchase.)

In response, state lawmakers led by Sen. Byron Sher (D-Stanford) are considering legislation to require public disclosure of such estimates before the state enters into large land deals.

“When you are spending taxpayer dollars, I think there is a legitimate question about whether you should provide the public with as much information as possible prior to the close of the deal,” Sher said.

The latest Ballona Wetlands appraisal comes after environmental groups complained to state officials that the rumored $135-million price tag was far too steep.

One group, the Ballona Wetlands Lands Trust, released a “green paper” saying the land was worth just $22 million. The document noted that much of the property lies atop an underground gas storage reservoir and is not zoned for development.

“From our perspective, we don’t mind letting the developers sit on that land until they get real about the price, because there are a number of legal and political constraints to them developing it anyway,” said Sabrina Venskus, director of the land trust group.

In addition to the cost of buying the land, the government would need to bring the wetlands back to health. Some experts estimate that could cost as much as $100 million.

Some of the parcels are wetlands in name only.

Over the past century, they have been divided by roads and separated from the ocean and Ballona Creek, which is lined with concrete to prevent flooding.

At a minimum, experts have said the state would need to artificially reestablish the natural tidal flushing that supports biodiversity while also protecting nearby roads and apartments from flooding.