Auditor: If you love the state, let some of it go

For Sale: Waterfront property, Marin County. Spectacular view of San Francisco Bay. Colorful history as state prison. Asking $2 billion. Desperate seller (State of California).

An ad like that could run in the classifieds if state Sen. Jeff Denham (R-Atwater) has his way.

The proposal to sell the 432-acre San Quentin State Prison site is one of several ideas being considered by the Legislature to streamline the state’s vast property holdings and help cash-strapped California raise money as an alternative to raising taxes.

Republicans like Denham who voted against recent tax increases, and some other legislators, are pushing 10 measures to raise billions of dollars by selling underutilized property, including the Los Angeles Memorial Coliseum and parcels once intended for the extension of the 710 Freeway in South Pasadena.

But some of the proposals are running into a buzz saw of opposition. Indeed, a key state Senate committee is expected today to put the San Quentin bill on a shelf.

A week after the state auditor faulted some agencies for not properly managing surplus property and eight years after she urged an overhaul of the process, it’s clearly still difficult for officials to let go of government holdings.

“There is a sense of proprietorship that grips bureaucrats and legislators,” said Lew Uhler, president of the California-based National Tax Limitation Committee.

The state owns about 6.7 million acres of real property, including more than 22,000 structures, according to State Auditor Elaine Howle.

In her review last week, Howle said there should be one office overseeing decisions on which properties are surplus, but legislation proposed to accomplish that has stalled in the past. There is also little incentive for state agencies to sell their property because the proceeds typically go toward paying off state bonds rather than into agency coffers, she said.

Howle holds up one agency as a model for change: Last year, 476 surplus Caltrans properties worth $162 million were sold, she said.

Denham revived the idea of selling the 85-year-old Coliseum, which has not been home to a professional NFL team since the mid-1990s. The Coliseum and adjacent Sports Arena could fetch the state $400 million, according to an analysis by the independent Legislative Analyst’s Office.

“Ineffective oversight and local infighting” have plagued the property, which has “fallen into disrepair and has lost several major tenants,” Denham writes in his proposal, SB 29.

Los Angeles-area lawmakers, including former state Sen. Mark Ridley-Thomas, scuttled a similar proposal last year, saying reforms at the local level would improve the situation.

The debate is expected to heat up April 28, when the Senate Committee on Governmental Organization holds a hearing on Denham’s bill.

Assemblyman Anthony Portantino (D-La Canada Flintridge) would like to sell hundreds of residential properties purchased for the extension of the 710 Freeway that never happened. Such a sale, outlined in Assembly Bill 113, could generate $500 million, Portantino says, which “could be used to fund vital state programs, especially during these difficult economic times.”

His bill has not yet garnered any opposition.

Other measures being considered with little or no opposition would lease the Compton Armory to a nonprofit group and sell the California Highway Patrol office in Chico and the Department of Forestry headquarters in Redding.

The San Quentin bid has drawn national attention at a time when the state is planning to spend $356 million to expand and improve death row.

“This prison is 156 years old and it’s the most inefficient prison in the nation,” Denham said. “It needs to be sold. We need the money right now.”

The San Quentin site would be a hot property if it were placed on the market, according to Katie Beacock, president of the Marin Assn. of Realtors.

“There would be enormous interest,” she said. “It’s a magnificent piece of property.”

State Sen. Loni Hancock (D-Berkeley) is concerned about the effects of moving inmates away from the Bay Area’s network of social services. A member of the Senate Public Safety Committee, which takes up the proposal today, she is also worried about a provision in the bill that would waive certain environmental review requirements -- something also contained in many of the other proposals to sell surplus property.

The measure is also opposed by a defense attorneys group, the ACLU and the powerful state prison guards union.

“You’ve got almost a thousand staff members who would potentially be displaced,” said Lance Corcoran, a spokesman for the California Correctional Peace Officers Assn.

The association is a major contributor to lawmakers and often gets its way.

Sen. Mark Leno (D-San Francisco), chairman of the public safety panel, said the Denham bill clashes with an unofficial agreement among committee members not to pass legislation that would worsen prison overcrowding.

“I think in a perfect world it might make sense, but that’s not where we find ourselves,” Leno said. “We have an enormous overcrowding problem. If we were to close San Quentin, this would exacerbate our problem tremendously.”

Denham plans to argue in the committee hearing that if the prison site were sold, $1 billion of the receipts could be used to build a state-of-the-art facility that includes a death row, in a more remote and less expensive location.

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patrick.mcgreevy@latimes.com