The California Coastal Commission document, which the city received Friday, marked the final hurdle before the city could move forward with the construction of the Balboa Peninsula development.
"We've got our permit; we're moving ahead," said Councilman Mike Henn. "We're going to start our construction and get it done."
As planned, the Marina Park development — estimated to cost $21 million to $24 million — will replace a mobile home park and provide increased public access to the coast.
City officials hope to distribute notices this week to mobile home residents to indicate they have 90 days to vacate, said city spokeswoman Mary Locey.
The city lowered the rent and bought the residents' mobile homes for $35,000 each in a 2007 settlement agreement. Residents now have the option to repurchase their mobile homes and move or to leave them in the city's possession.
Construction could then begin by the end of 2013, though the project must still be put out for bid, Locey said.
The proposed park, located on 10 acres of city-owned property between 15th and 18th streets, is slated to include a multipurpose community center and a building for the Girl Scouts, according to a city news release.
Also planned for construction are a 23-slip marina, basketball half-courts, a children's play area and public parking spaces.
City Hall is still awaiting approval of its application for a permit amendment that would allow for the construction of a 73-foot-tall faux lighthouse at the park, said Karl Schwing, an Orange County permit supervisor with the Coastal Commission.
The contentious lighthouse exceeds the 35-foot limit for waterside buildings. The commission originally recommended that it be 55 feet but approved the taller, requested height after further discussion and a vote in March.
Some Peninsula residents have strongly opposed the lighthouse, arguing that it would be incompatible with low-rise structures in the area.
Schwing said the attention focused on the lighthouse element of the project affected the time available to finalize the permit conditionally approved in June 2012.
Certain "special conditions" outlined last year as necessary to be met before the project could be permitted also took time for the city and commission to adequately address, he said.
Still, that 14 months elapsed before the project permit arrived seems "extraordinarily long," Henn said.
Under mounting frustration as the months ticked by, Henn scheduled a July visit with the Coastal Commission's executive director in San Francisco.
Three weeks ago, on July 31, Henn said he traveled with Councilman Ed Selich and Public Works Director David Webb to discuss how the city and commission could work together more effectively and efficiently.
"Partially, as a result of that meeting, our permit was issued," Henn said.
The concept for the park has been under consideration for about 10 years.