Residents of Laguna Terrace Park applauded Tuesday night when the City Council gave conditional approval to subdivide the property so tenants would eventually be allowed to own the land under their mobile homes.
The council voted 4 to 1 to adopt a resolution that conditionally approves a modified tentative tract map of the property and the coastal development permit, which is expected to be challenged by the California Coastal Commission. City Manager Ken Frank explained the tract map would creative individual parcels.
"The city won't approve a final map until the issue of the permit is settled," park manager Jim Lawson said. "The city has seven calendar days to issue a notice of final action to the Coastal Commission, which sets off an appeal period of 10 working days."
In the meantime, Lawson will apply for a preliminary public report from the state Department of Real Estate, which will allow him to quote tentative prices for the individual parcels, take reservations and accept deposits as long they are not co-mingled with park operating funds.
The commission takes the position that it has jurisdiction because development will occur within 100 feet of a stream and there wasn't a coastal development permit for the reconfiguration of the property in 1995, which was not contested then.
"Basically, [the] Coastal [Commission] is trying to get control of the subdivision," said Community Development Director John Montgomery.
Lawson said the revised map has entirely omitted any of the sub-divided property within the commission's area of certification.
"The resulting sub-division is entirely within the city's certified Local Coastal Program," Lawson said. "That was the whole idea and the permit does not authorize any development within 100 feet of a stream."
Lawson contended, and city staff agreed, that the project does not constitute development.
"This is a paper subdivision," Lawson said. "There is no change on the ground. The use doesn't change."
The city Planning Commission found in its June review of the amended proposal for the project that no change in the density or intensity of the use is involved. Commissioners recommended approval of the tentative map and the permit "under protest," as suggested by Commissioner Rob Zur Schmeide.
"I am not comfortable that the city and the Coastal Commission seem to be at odds with what the city can and cannot do," Commissioner Norm Grossman said. "The city attorney advised us that we had no option but approval."
The local agency authorized to approve, conditionally approve or disapprove that the map is not allowed by state law to consider issues of consistency with the city's general plan and/or municipal code. The Planning Commission wants to hold a de novo hearing, essentially starting from scratch.
City staff opined that the applicant's proposal is consistent with the state Subdivision Map Act, categorically exempt from the California Environmental Quality Act, and legal findings for the approval of a coastal development permit can be satisfied.
A required report on the conversion's impact on the tenants has been provided by the applicant, Laguna Terrace Park LLC, as well as a survey of residents' support and protection from displacement by non-purchasing residents.
No one in the audience that packed the City Council Chamber for the hearing spoke against the subdivision.
All but one of the speakers urged the council to take the action in spite of the inevitable challenge by the Coastal Commission, which could itself be challenged in the courts.
South Laguna Civic Assn. President Bill Rihn said it seemed the project was appealable to the coastal commission so pressure should be applied to speed up the process.
"Litigation would slow up the process," Rihn said.
Montgomery said the city's permit, if upheld, would potentially reduce delays in the entitlement process, and time is an issue, tenants said.
"Property values have come down to reasonable levels and interest rates are at an all-time low so we need to get this accomplished in a timely fashion" tenant Casey Skeen said.
In an e-mail to council members, the South Laguna Civic Assn. and Laguna's Sierra Club representative Penny Elia, park resident Peggy Ford wrote that she loses nearly 1% of the money she has set aside to buy her land every month that the residents' purchase process is delayed.
"At the end of 36 months, I will have lost $100,000 and 33% of my purchase savings with nothing to show for it," Ford wrote. "We are responsible, trustworthy individuals that have excellent legal counsel, will perform due diligence and will be subject to the Department of Real Estate. This is a very extensive process that will analyze the infrastructure, pricing of lots, CC&Rs, park rules and regulations, and a number of other matters. … So we don't need any additional big brothers."
Montgomery said the Coastal Commission would require a full environmental report on the project, which could mean a considerable delay.
"We feel we have been patient during this arduous process, and we'd like to be able to use the window of opportunity that is being offered to us by the present owner to purchase the land our homes sit on and to be pro-active about it and do it while interest rates on home loans are advantageous," said Lenore McManigal Garman, a resident of the park for eight years.
Garman said her family has cut its association with the Sierra Club, members of which support the Coastal Commission position.
"My mother, a native of San Francisco, began her long membership in the Sierra Club in 1916 when she was a student at the University of California," Garman said. "She hiked the Sierra Nevada with other conservationists and preserved trails. When the Sierra Club left its roots and became a political activist organization with a political agenda, our family demurred and dropped its membership.
"I state this simply to show that the residents of Laguna Terrace Park are contributing, interested members of Laguna Beach. We have all sorts of backgrounds. We are friendly and inclusive and are volunteers in the community."
Councilwoman Verna Rollinger, who voted against the subdivision, said she understood why the residents love the property, but she could not approve the proposed resolution without an acknowledgement of its appealabilty to the Coastal Commission.
Rollinger also was concerned about low- and moderate-income residents being forced out of the park by rent increases if they could not or did not wish to buy the land under their homes.
Former resident Dan Freeman, who was forced to sell his home due to economic necessity, said state law provides for rent control for tenants who qualify as low-income residents.
"As it is now, those residents whose leases have expired are on a month-to-month basis and their space rent can be increased at any time by any amount the park owner may wish to impose," Freeman said.
The property has been owned by a member of the Esslinger family or the Esslinger Family Trust for decades and control was the subject of a drawn-out bitter legal battle, settled in July 2007.
Since then the residents have been unwavering in their attempts to buy the property.
"Aside from the council's vote, I was most happy to see us behaving like a community," Lawson said. "We showed up, we stood up and we spoke up — like a neighborhood should."