Questions over fate of hotel workers delay supes’ vote on Dana Point development
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Amid lingering concerns over job losses, the Orange County Board of Supervisors this week delayed approval of ground lease agreements that would have inched Dana Point Harbor’s revitalization closer to completion.
Supervisors stopped short Tuesday of locking in new long-term leases for hotel and commercial developments along the county-owned harbor, part of an effort to attract more than $700 million in private investment.
It was the second time this summer panelists failed to find common ground on the matter, despite a staff report warning further delays would impact hotel financing and construction.
A push to save the jobs of 19 hotel workers at the Dana Point Marina Inn, slated to be demolished and replaced by a 130-room boutique hotel and surf lodge, proved a sticking point.
Developers sent a letter to supervisors Monday with assurances they would either transfer workers to other hotels or give them a 60-day advance notice of layoffs as room reservations wind down toward the end of the year.
“To the extent that I don’t see a more-binding provision … that will assure that these employees are going to be retained, I’m going to have a tough time,” said Supervisor Vicente Sarmiento. “I want to support this. I would hate for this to be the deal breaker for me.”
Wind & Sea restaurant in Dana Point will close Sept. 15.
A previous board majority approved the harbor’s revitalization in July 2018. After soliciting competitive bids, supervisors moved forward with lease agreements with two limited liability corporations, Dana Point Harbor Partners and Dana Point Harbor Partners Drystack.
But the project faced significant delays due to the pandemic.
Revitalization of the harbor’s commercial corridor has been phased in since with final construction approaching. The Wind & Sea steakhouse is set to close Sept. 15 and closure of other wharf businesses follows on Nov. 1.
Supervisors Tuesday considered separating a hotel lease agreement from the original 2018 lease to help it secure financing. They also discussed another new lease for commercial and marina development while updating a third lease to ensure consistency across projects.
Executing the new leases would allow the hotels, which have already gained approval from the city of Dana Point and the California Coastal Commission, to open before the Los Angeles Summer Olympics in 2028, according to a county staff report.
Dana Point Mayor John Gabbard told the board it had the power to make the harbor’s economic engine “roar” by approving the leases.
“The new hotels to be built will represent $80 million of economic impact [for] Dana Point and hundreds of million dollars to the County of Orange,” Gabbard said. “Let’s finish what you started.”
Members of Unite Here Local 11, a union representing hotel workers, echoed a call to protect jobs during public comments and favored renovation of the existing hotel.
“Finding work at a new hotel isn’t easy,” member Teresa Garcia told the supervisors. “Unfortunately, the proposed lease agreement doesn’t have a provision to protect these workers.”
Supervisor Don Wagner brought up nearly 200 employees at Wind & Sea who will lose their jobs when the beloved restaurant closes next month in noting his opposition.
He also opposed the leases as the county is given free meeting room access up to six times a year.
As the lease agreements required a super-majority vote from the five-member board, finding a way to secure that threshold proved elusive.
Supervisor Katrina Foley said her office was already working with Wind & Sea to transition employees.
Regarding the 19 hotel workers, Foley asked the developer if he would be willing to agree to add a 60-day layoff notice.
Bob Olson, a partner with Dana Point Harbor Partners, indicated a willingness to do so. He also reiterated an intention by the hotel’s contracted manager to transfer employees to other Southern California hotels in its portfolio.
“These are valued people,” he said. “They’ve been working with us since we’ve taken over the hotel, and so there’s definitely [a] commitment there. The language, I understand, may not be as solid as Supervisor Sarmiento would prefer, but I think the result is essentially the same.”
Foley checked in with Sarmiento to see if Olson’s pledge at the lectern would move the needle on his vote.
“Without seeing something in writing, I just don’t feel comfortable,” Sarmiento said. “I just want to do it right with no regrets.”
Board Chair Doug Chaffee moved to continue the discussion to Aug. 25 after it became apparent the votes would fall short.
Supervisors voted 4-1 to punt the discussion, with Foley dissenting.
“I don’t want this project to die,” Chaffee said. “I think we can work things out. We will get there.”
