Park construction on former DWP land to begin in November

Photo of former DWP property taken from the DWP Street Specific Plan as amended Nov. 9, 2015. (Text added.)

Shea Homes, the new owners of the former DWP property, plan to begin grading a park on part of the site this month. Bob Yoder, division president for Shea Homes, said work on the park would begin “in earnest” in November. The California Coastal Commission has already issued a development permit for 10.9 acres of land. Of that, more than 6.4 acres will be developed as a park. Yoder confirmed that 30 residential homes will be built on the land.

Shea Homes recently bought the property from Bay City Partners. Escrow closed on June 11. Sellers and buyers alike have declcined to say how much the land sold for. But according to CoreLogic, the property sold for more than $36.6 million. The Bay City Partners bought the land for $4.5 million in May 2003.

“We’re hoping to start a model home somewhere in January,” Yoder said. He said construction of houses for customers would start in early 2019.

As for the “visitor serving” area of land that has been mandated by the California Coastal Commission, Yoder said that part of the development would be implemented by a non-profit or another group.

Yoder said housing construction would take two to three years. He said the houses would be 3,000 to 4,000 square feet in size. He said the selling prices of the houses hasn’t been established.

“Hopefully the market will be as strong as it is today,” Yoder said.

A DWP/Bay City Partners Project Chronology

Compiled By Charles M. Kelly and Seal Beach Journal/Sun Editorial Staff


• Seal Beach adopts first DWP Specific Plan. Plan calls for 70 percent open space and 30 percent “visitor serving” uses such as a 300-room hotel, restaurants or shops. Plan also limits development of “visitor serving” to northerly part of the parcel. At the time, the property is described as about 9 acres. By the time the property is sold in 2018, the development area will be 10.9 acres. The history of the boundaries is complex.


• A letter from the Orange County Health Care Agency (the county’s health department) reportedly clears the property. In 2012 the county agency will report it has no records concerning the decontamination of the site. Yet a copy of the letters is in possession of Bay City Partners.


• Bay City Partners buy former DWP site for $4.5 million.


• September: Seal Beach files eminent domain suit against Bay City Partners, arguing that Bay City Partners could block access to the beach and to a sewer line.
The city offers $2.30 per square foot for part of the property.


• Jan. 25: Seal Beach Director of Development Services Mark Persico issues a letter deeming the DWP Specific Plan Amendment application as complete.

At the time, Bay City Partners wants to build 55 single-family homes or 75-room hotel.

Feb. 17: The DWP Specific Plan Advisory Committee holds an organizational kick-off meeting.

April 19: Bay City Partners file suit against Seal Beach, claiming two city projects encroach on its private property and that the city is illegally trying to take portions of the land by eminent domain. One of those projects is the San Gabriel River Bike Trail redevelopment.

The bike area project would alegedly include 2.7 acres of the Bay City Partners’ property. That issue will be resolved in a courtroom.

April 26: the Seal Beach City Council unanimously approves the San Gabriel River Bike Trail project. The council also votes unanimously to reject Bay City Partner’s appeal of the mitigated negative declaration for the project.

Friday, Aug. 13: Bay City Partners announce they have served the city of Seal Beach with a 30-day notice to quit the use of the beach access roadway to the River’s End Café, the windsurfing staging area and the sewer easement at Ocean Avenue and First Street.

Dec. 14: Orange County Superior Court Judge Thierry Patrick Colaw rules in favor of the Bay City Partners and halts the city of Seal Beach’s River’s End (San Gabriel River Bike Trail redevelopment) project.


Jan. 7: Sun Newspaper reports that Seal Beach and Bay City Partners differ on “fair market value of land” at heart of eminent domain lawsuit. “The city of Seal Beach, which at first tried to condemn the land for $48,000, has submitted a new appraisal of $120,545.

“The property owners’ appraisal for the same land came in at $5 million,” the Sun said.

March 28: Seal Beach and Bay City Partners reach out-of-court settlements of two lawsuits.

Under the agreement :

• The city receives a sewer access and maintenance easement,

• Seal Beach leases the beach parking lot access road and bike trail on the DWP property.

• Preparing a comprehensive environmental impact report on Bay City’s proposal and the city’s payment of $900,000 for the easement and

• If the Coastal Commission approves Bay City’s proposal, the city would purchase the 70 percent open space for $1.1 million.

The Sun reports that Bay City has submitted a proposal for a 48-lot residential project.

April 25: Opponents of the Bay City Partners project denounce the settlement at the City Council meeting. Those critics include members of the Parks and Recreation Committee, a member of the Tree Advisory Committee, a member of the Environmental Quality Control Board and a former City Council member.

Mario Voce, a member of the Environmental Quality Control Board, suggests removing the DWP property from the jurisdiction of the Redevelopment Agency. (Before it was disbanded by changes in state law, the Seal Beach Redevelopment Agency was made up of the five members of the City Council.)

Former Councilman Charles Antos says he is not to blame for the settlement.

Councilwoman Ellery Deaton, who had campaigned for her District 1 seat by supporting a “70 percent open space” plan for the property, defends the settlement.

Deaton points out that development plans would have to go before the DWP committee, the Environmental Quality Control Board, the Parks and Recreation Commission, the Planning Commission and the City Council.

Mark Loopesko, at the time a member of the Parks and Recreation Commission, asks that the settlement be placed on the next City Council agenda.

June 13: The council reviews the settlement.

Mario Voce, of the Environmental Quality Control Board, says he will look very hard at the environmental questions concerning the proposed development. According to other news media, Voce has a background in graphic design.

Voce opposes the legal settlement.

“The agreement itself is disgusting,” Voce said.

Resident Beth Gabler supports the settlement and says it is time to stop calling the land the DWP property. “It’s Bay City’s property and should be addressed as such,” Gabler says.

Deaton says there was absolutely no agreement between Seal Beach and Bay City to approve the project. (In the months ahead, opponents of the project will accuse the city of being illegally predisposed to approving the project before the development process begins.)

Then City Attorney Quinn Barrow says the public would have many opportunities to speak about the proposed development project itself.

Barrow says state law requires the staff to consider the project in good faith, referring to language in the settlement that critics have cited as an agreement to approve the project without public input.

Jim Caviola, an attorney and a critic of the settlement, citing the 1982 specific plan for the property, says workshops at that time determined there should be 70 percent open space. Caviola says the settlement agreement gave Bay City 7,000 square feet of a public road.

Mike Buhbe, who was active in the fight to lower residential height limits in Old Town to 25 feet (or two stories), says the part of the property that the city purchased is where the old Los Angeles Department of Water and Power plant once stood.

Buhbe sys he would like to see what remediation was done on that property.

According to a contemporary account in the Sun, the Bay City Partners have refuted soil contamination claims in the past.

Paul Yost, a former Seal Beach councilman, expresses concerned about the lack of beach access.

Sept. 12: The Seal Beach City Council approves an amendment to expand the scope of the environmental impact report for the Bay City Partners’ property to include an analysis of possible soil contamination.

The city has already hired RFB Consulting to prepare an environmental impact report on the proposed site of the Bay City Partners’ development.

RFB asks to have Dudek, the firm that worked for the city on the ARCO gas station decontamination project, look at Bay City’s property on the former site of a Los Angteles Department of Water and power plant near First Street and Marina Drive.

However, Councilman Gary Miller wants a better study of possible contamination, citing his concern about possible asbestos contamination on the property. Miller does not believe previous tests of soil on the property had gone deep enough.

City Attorney Quin Barrow says the year 2000 study found three out of 375 samples contained asbestos and none of those samples contained more than one percent of asbestos.

Former Councilman Charles Antos says a 400-page document said the property was contaminated with arsenic and asbestos.

Other council members are taken by surprise by Antos’ comments.

Sept. 29: In an opinion written for the Sun Newspaper, Ed Selich, project manager for the Bay City Partners project, said Antos was misinformed and that his documents were taken out of context.

He says Bay City Partners had accumulated more than 50,000 pages of documentation on the property.

December: Draft Environmental Impact Report for project is made available to the public. Under the California Environmental Quality Act, any alternative to a proposed development project must be subject to an economic feasibility study.

Dec. 14: The Archaeological Advisory Committee is scheduled to study the Archaeology Section of the Draft EIR. It is not known if any members of this committee took a public position on the project.

Dec. 15: The DWP Advisory Committee is scheduled to look at the Draft EIR and request for Land Use Change.


Jan. 9: Deadline for comments on draft EIR.

The law firm Chatten-Brown & Carstens sends a letter on behalf of “Seal Beach for Open Space” to then-Seal Beach Director of Development Services Mark Persico. The letter accuses Seal Beach of being illegally pre-committed to approving the Bay City Partners project.

The members of Seal Beach for Open Space have never publicly identified themselves as such. Its members remain unknown.

Chatten-Brown & Carstens is a public interest firm that handles land and environmental matters.

The letter to Persico is apparently hand-delivered to the Sun by an unknown person in an envelope without a return address on it.

April 2: Final EIR for project is released.

Robert Goldberg, a planning commissioner who says he is commenting not as a commissioner but as a citizen, said “The final EIR should include views and vistas as they would exist without the opaque fence.”

Jim Caviola of the Tree Advisory Board says there there is no current record of a 1987 letter from the Orange County Health Care Agency to the Bay City Partners that cleared the land for public use.

A copy of Caviola’s Public Record Act request to the Orange County Health is included in a Chatten-Brown & Carstens letter commenting on the draft EIR.

Feb. 22: Parks and Recreation Commission holds a meeting but takes no action on project.

April 17: The DWP Advisory Committee votes 4-1 to recommend against the Bay City Partners project. The committee has seven members, but two were absent. One of those absent members sent a letter to the committee opposing the project. The letter was dated prior to the public hearing held by the committee, whose members are appointed by the City Council.

Committee member Nancy Kredell, apparently reading from a prepared statement, advocates setting aside the out-of-court settlement. She says the city was illegally pre-committed to approving the project.

DWP Advisory Committee member Rita Strickroth said she has not changed her mind about her preference for the original 70 percent open space part of the site plan for the property.

(The definition of what is “70 percent open space” has been debated throughout the controversy over the project, with supporters and opponents using different definitions.)

The sole dissenting voice on the committee in favor of the project is Seth Eaker, who said Seal Beach had multiple opportunities to buy the land and did not.

Eaker parts company with the owners on one point: Eaker prefers a 41-home project over Bay City’s 48-home proposal.

Tree Avisory Committee member James Caviola, an attorney, says there had been no public discussion of out of court settlement between Seal Beach and the Bay City Partners.

Planning Commissioner Robert Goldberg first raises the issue that part of the open space in the proposed project includes land under the San Gabriel River.

Bay City Partners’ representative Ed Selich later tells the Sun that the owners pay property taxes on the land under the river.

Brian Kyle, one of the Bay City Partners, says it was evident from the previous DWP Advisory Committee meeting that a majority of the committee members did not have open minds.

April 25: The Seal Beach Environmental Quality Control Board votes 4-1 to recommend that the Final EIR was inadequate.

The meeting was originally scheduled for April 16, but was rescheduled to comply with public notice requirements set by state law.

Board members Barbara (sp) Barton, Marla Smalewitz and Mario Voce all express concern for preserving open space on the property.

Voce said the EIR read like a legal brief in favor of the project and said that he stopped reading the document.

Several current and former city officials who spoke out against the project Wednesday night: Nancey Kredall, a member of the DWP Advisory Committee; Bruce Monroe, of the Ad Hoc General Plan/Local Coastal Plan Committee; former Councilman Charles Antos and Jim Caviola of the Tree Advisory Board.

Caviola quoted from documents he said dated back to 2000 that said the property was contaminated.

Ed Selich, project manager for the Bay City Partners, said environmental remediation was a process that happens in stages. He said the fact the documents Caviola cited were from 2000 was key.

The Final EIR included an Aug. 17, 1987 memo from then-Seal Beach Director of Developmental Services Ed Knight to then-City Manager Bob Nelson that referred to the Health Care Agency letter.

“As the letter from the county indicates, no further action is needed on the DWP site, and the cleanup has been completed,” Knight wrote.

April 25: A post online at “What’s Up in Seal Beach” argues that “They are out to destroy ‘Mayberry by the Sea,’” and says the developers have threatened to sue the city if the council does not approve the requested zoning change.

May 2: The Planning Commission holds a public hearing on the project, but takes no action at that time.

District 3 Planning Commissioner Robert Goldberg says he believed that a hotel would be viable on the area zoned for development. The site plan at the time called for a 150-room hotel on the development area.

However, Goldberg acknowledged concerns of residents who live near the property site who opposed having a hotel nearby. Goldberg says he is willing to compromise on a hotel. He is not, however, willing to negotiate on the 70 percent open space.

A key dispute between the property owners and opponents of the project is how that 70 percent open space is defined. Goldberg cited a 1982 map based on a specific plan amendment and argued that the City Council’s intent was for 7.9 acres to be open space. Goldberg himself described the 1982 map as messy.

The Bay City Partners offered the city 6.4 acres of open space to be sold to the city at $1.1 million as based on the out-of-court settlement of two lawsuits.

Seal Beach staff based their assesment of the open space versus development on the legal description of the property. The consultants who drafted the Final EIR used acreage rather than percentages of the property—which has been described variously as 10.7 and 10.9 acres of land.

Commission Chair Sandra Massa-Lavit said she wasn’t pleased with any of the site plans presented at the meeting. She objected to the property owners’ proposal to count green spaces in the housing project as part of the open space for the public.

The planners voted to continue the hearing.

May 17: Planners voted 4-1 to recommend that the City Council approve the project. Commissioner Robert Goldberg cast the dissenting vote. Goldberg said he did not know why the Environmental Quality Control Board had called the Final EIR inadequate. Goldberg’s objection was based on the question of open space.

District 1 Commissioner David Everson said he thought Seal Beach should move forward. He said he didn’t feel the 70 percent/30 percent formula was the best way to look at the property.

District 2 Commissioner Esther Cummings agreed with Everson. She said she didn’t want to see a fence around the lot for another 30 years.

Commission Chair Sandra Massa-Lavitt, who represents District 5, said for the public to get the open space they want the northern part of the property has to be developed.

The feasibility of building a hotel on the development part of the site, as called for in the site plan, was also discussed.

Consultant Larry Kosmont, whose firm evaluated the economic sense of building a hotel on the Bay City Partners’ property a year ago, said the market for ground-up hotels had “tanked” at that time.

Goldberg questioned Kosmont’s use of a $4 million figure as part his analysis to determine the feasibility of the project.

Goldberg believed that figure was arbitrary.

“I’d feel the same way if I didn’t have to put a down payment on a house,” Kosmont said.

(Bay City Partners bought the land for $4.5 million. The Kosmont study did not include the estimated $500,000 cost of the EIR—which had not been conducted at the time.)

The Kosmont study did say a 60-room hotel might have a better chance of success than a larger hotel.

However, he said financing for a ground-up hotel project was now harder to come by.

Barbara Wright, who said she served on the original DWP Advisory Committee, said they worked for many months on the plan that now governs how the property can be developed.

“We should have liked the whole area to be park,” she said. However, that wasn’t financially possible so the group opted for 70 percent open space and 30 percent hotel.

Opponents of the proposed housing development said the feasibility of building a hotel was not relevant. However, the California Environmental Quality Act requires a feasibility study of any alternative to a proposed development project.

June: Bay City Partners begin referring to the property as “Ocean Place.” Residents, particularly opponents of the development project, continue to refer to the land as the DWP property. The specific plan is called the DWP specific plan.

June 26: Bay City Partners now propose a 32-lot residential housing project with lots of varying sizes.

The City Council approved on first reading requested changes to the site plan for the Bay City Partners property.

The catch: the property owners would have to give the city the 6.4 acres that Seal Beach had agreed in a legal settlement to buy for $1.1 million. (The state denied the former Redevelopment Agency’s authority to earmark $1.1 million for the project.)

Council members Ellery Deaton and Gordon Shanks both said they would not vote for the project unless Bay City Partners gave the city the land.

Councilman Gary Miller cast the sole dissenting vote against the project. Miller remained concerned about possible asbestos contamination on the property.

Councilwoman Deaton said the 1979 plan described the 30 percent area of the project with two sentences that contradicted each other.

Councilman Shanks said he was present during the 1979 discussions about the former power plant site. Shanks said that at that time, the consensus was 6 acres of park and 3 acres of development to fund the park.

Shanks said he didn’t feel that accepting the Bay City Project, with 6.4 acres for park and 4.5 acres for housing, was a sellout.

Councilman Michael Levitt said the land had always been privately owned. It was never public land even when owned by the Los Angeles Department of Water and Power. Levitt said it had to be developed or it would remain as it was.

Residents and council appointees were also divided on the project. Interim Community Development Director Greg Hastings said that as of 5 p.m., Monday, June 25, the city had received 54 e-mails or letters in favor of the project, 33 against and five that did not take a position. He said staff had received a petition with more than 400 signatures supporting the 70 percent/30 percent formula for the land use on the property.

The law firm Chatten-Brown & Carstens sent another letter to Seal Beach, calling for redistribution of the EIR in the face of changes to the Bay City Partners project.

City Attorney Quinn Barrow said that the letter raised no new issues except that one, which he said was incorrect.

July 9: Seal Beach City Council approves project. Buyers of individual lots will have two years to build. One resident asks council to send project back to Planning Commission. Councilwoman Deaton says she wants to make sure specific plan, legal description and tract map do not contradict one another.

The project next goes to the California Coastal Commission.

The Bay City Partners’ donation of what is now being called 6.4 acres of open space was contingent on the state agency issuing a Coastal Development permit.

December: California Supreme Court upholds the constitutionality of the assembly bill that dissolves redevelopment agencies and redirects their property tax revenues.


January: Seal Beach resident Robert Goldberg speculates that the ruling upholding the abolition of redevelopment agencies could affect the city’s dealings with Bay City Partners, owners of the former Los Angeles Department of Water and Power property.

A tentative DWP settlement agreement provides for a $1.1 million payment from the city to Bay City Partners upon project approval by the Coastal Commission. The money is supposed to purchase 6.4 acres of land that will be developed as a park to be built by the city of Seal Beach.

While the source of that money was not specified in the settlement agreement, it was likely that the money would have come from the RDA, since the DWP property is within the boundaries of the RDA’s Riverfront Project.

Goldberg’s speculation will eventually prove correct: the state will not allow the city to spend the $1.1 milllion to buy the 6.4 acres. The Coastal Commission will ultimately require the Bay City Partners to build the park and give it to the city before residential development will be allowed.

February: The California Coastal Commission says the Bay City Partners’ application for the Ocean Place project is incomplete and has asked for more information.

The Sun obtained a photocopy of the Coastal Commission’s five-page letter when an unknown individual hand-delivered a sealed envelope (without a return address) to the newspaper’s Main Street Seal Beach office. The “notice of incomplete application” was sent to Selich’s Newport Beach office on Feb. 6, 2013.

Ed Selich, the project manager for Bay City Partners, dismisses the importance of the notice.

“Typical Coastal Commission,” Selich said in an e-mail to the Sun. “They find all applications incomplete to avoid the consequences of the permit streamlining act. We are still on schedule.”

The letter requests a copy of a final agreement between the Bay City Partners and the State Lands Commission concerning a public trust easement on the property.

“The State Lands Commission staff is drafting the exchange agreement,” Selich said. “We will be reviewing it shortly.”

April: The Seal Beach City Council holds a study session on the housing element of the general plan following the regular council meeting on Monday, April 22. According to Jim Basham, director of Community Development, the sole purpose of the session is to create a draft of the Housing Element to meet state requirements.

Basham said the council discussed whether the Accurate Storage area, the Boeing site or another part of Seal Beach might be considered for rezoning to allow residential development.

As the Sun will later report, cities that don’t comply with state housing element requirements could lose the authority to issue building permits.

This would have the potential to impact business and residential development in Seal Beach. Although not discussed in public, that could have effected the proposed residential development of the former DWP property.

May: The Seal Beach City Council introduces an ordinance changing the zoning for 4 acres of industrial property across the street from the Seal Beach Police Department’s headquarters last week.

The change will allow residential housing to be built on the industrial property now occupied by Accurate Storage. It does not mean residential housing will actually be built. No such project was proposed at the time and no known proposal for such a project has been submitted to the city as of July 2018.

The new ordinance creates a potential location for 90 housing units. However, the council had recently passed an ordinance that would allow the property owner to continue using the land for light industry.

September: A report by California Coastal Commission staff opposes the Bay City Partners’ “Ocean Place” development plan.

District One Councilwoman Ellery Deaton says, “This council voted to allow 32 homes in exchange for almost 6.5 acres of public park land. Now it is up to the Coastal Commission to hold public hearings and make the final decision. If you feel strongly about this project, I urge you to attend the public hearings and testify,” she said.

Seal Beach City Manager Jill Ingram is apparently disappointed with the staff report.

“Although the city is disappointed with the Coastal Commission staff recommendation for denial of the DWP/Ocean Place Project, we look forward to the Coastal Commission public hearing and the Coastal Commission’s consideration of the significant merits of this project,” Ingram said.

October: An Oct. 9 Coastal Commission hearing on the project is postponed.

November: Representatives of Bay City Partners and the city of Seal Beach withdraw the application for the so-called Ocean Place project at the request of members of the California Coastal Commission.

Apparently, the commission could not legally extend the time to review the application so commissioners asked the applicants to withdraw and resubmit at a later date.

Ed Selich, the project manager for the development of the former DWP propoperty, agreed to withdraw the application for a coastal development permit Friday afternoon, Nov. 15.

“We did withdraw as a technical way to obtain a continuance past January to allow staff time to evaluate a peer review of the hotel studies we did,” Selich said.

Commission staff criticized the findings of economic studies that said a hotel would not be feasible on the grounds that the studies were based on the 70 percent open space restriction that was imposed by the site’s specific plan.

“The commission agreed to allow us to resubmit with no fees and indicated to the staff that they wanted this back on the agenda as soon as possible. We will be resubmitting the application as soon as possible,” Selich said.

Councilwoman Ellery Deaton said the Coastal Commission wanted more information on the land swap with the State Lands Commission, clarification on how the park would be paid for and possibly design changes to the proposed park.

Bay City Partners propose building 32 homes in Seal Beach with 6.4 acres of land to be given to the city for potential park space if the residential project is approved by the state. The land used to be owned by the Los Angeles Department of Water and Power.

According to Coastal Commission staff, the most recent economic study, which concluded a hotel would not be feasible, was two years old. Staff also pointed out that the studies were conducted during the recession and that the economy has improved since then. Later, Selich said he was frustrated by criticisms of the hotel feasibility study. He said they were submitted to the commission more than a year ago. Staff also opposed the project because residential housing is the lowest priority use for coastal land.

Selich said the project area is in the middle of a residential zone. He said the property was near such visitor serving areas as the River’s End, the San Gabriel River Bike Trail and Main Street.

However, commission staff said Main Street areas are currently zoned for commercial use.

Deaton said Main Street would die if businesses there were not visitor serving. She said the Main Street Specific Plan requires visitor serving uses of the ground floor of the commercial properties there. She said the proposed park was folded into the city’s Parks Master Plan.

Commissioner Robert Garcia of Long Beach said there was some value in discussing what the proposed park might look like, but he would prefer something more active. But Garcia also said he was glad the commission was not denying the project outright.

Commissioner Janna Zimmer of San Francisco said she wanted to look at expanding the open space area to 70 percent of the total. Zimmer also said she wanted a review of the hotel feasibility study and how it was constructed.

Mark Vargas of San Francisco said he wanted to find a way to move the project forward. He said that everyone was stuck on building a hotel without considering other visitor serving uses.

According to Commission Chair Mary Shallenberger, 50 people filled out speaker slips. However, each side was given a limited time to testify so only a few representatives of each side actually addressed the agency.

Mel Netter, a former commission member, said the hotel feasibility study should have been a forward-looking document rather than a backward-looking one. “In other words, you ought to ignore the so-called costs,” Netter said.

Seal Beach resident Jim Caviola said the property has always been public land.

He said the owners bought the land subject to public restrictions. Caviola also said he had been in touch with State Lands Commission about a land swap with Bay City Partners to address a public easement issue.

“There is no deal in place,” Caviola said.

Selich said the partners were negotiating a land swap with the Lands Commission, but that the Lands Commission would not act until the Coastal Commission had acted.

Coastal Commissioners, however, were reluctant to act without a completed land swap.


Tuesday, Oct. 15: Three alternate members of the State Lands Commissioners vote 2-0 on Tuesday, Oct. 15, to approve a swap land with Bay City Partners that eliminates a public easement issue and clears the way for a proposed residential development project to go before the California Coastal Commission. (The public easement had been discovered by attorney and Seal Beach resident Jim Caviola, a long-time opponent of the Bay City Partners plans to develop the so-called DWP.)

Ed Selich, project manager for Bay City Partners, said the property owners disputed the existence of the public easement but decided to negotiate a land swap with the state rather than fight the issue.

State Lands staff believed there was a public trust easement on 1.168-acre land-locked portion of the property that Bay City Partners intend to develop for residential housing. Bay City Partners, who own the former DWP site, offered the commission 1.177 acres of land along the San Gabriel River and the bike trail. The owners also agreed to pay the state $2.71 million. The Coastal Commission members had previously advised the Bay City Partners they would not consideer the proposed development until the public easment issue was resolved with the State Lands Commission.

Theresa Henry, representing the staff of the Coastal Commission (but, she says, not the Coastal Commissioners), also asks the State Lands Commission to deny the land swap. Henry says Coastal Commission staff does not believe the land swap was necessary. She says CCC staff does not agree that a hotel development is not feasible. She said that even if a hotel isn’t feasible, CCC staff believes some other visitor-serving commercial use would be feasible.

State Lands staff attorney Catherine Colson presented a staff report to the commission. She says staff valued the public easement portion of the property at $2.71 million. She said staff reached that figure by subtracting the potential difference between the values of the residential development of the project area from the potential hotel development.

However, Nancey Kredell, a Seal Beach resident and long time opponent of the project, says she didn’t know where SLC staff got that figure. She said the developers would make $11 million from the 1.168-acre portion of the land that was subject to the public easement. Kredell urges the State Lands Commission to deny the land swap.“The reason we’re opposed to this is that we aren’t given the same property we were promised before,” Kredell said, apparently referring to the original zoning the city imposed on the property.

Mel Nutter, who said he represented Seal Beach for Open Space, testified against the project, did not agree that the public easement parcel was relatively useless and also questioned the study that said a hotel was not feasible. Nutter, incidentally, was a founding member of the California Coastal Commission.

“What we’ve got is a difference between feasibility and profitability,” Nutter said. According to Nutter, the study improperly emphasized profitability.

State Lands Commission Executive Officer Jennifer Lucchesi says the commission’s appraiser reviewed the feasibility study and two other studies, one by supporters and the other by opponents of the project, and concluded that the Bay City Partners’ feasibility study was based on reasonable assumptions.

Carla Watson, then a member of the city’s Recreation and Parks Commission, asks if the developers really tried to find a hotel use for the land or waited for the opportunity to threaten the city with a lawsuit. She says the developer threatened to cut off access to the beach and the city filed a lawsuit. She said the city attorney at that time was inept and didn’t like to go to court.

Watson says the property owners are allowed to purchase the property as it was zoned for, a hotel development.

Acting State Lands Chair Alan Gordon (California chief deputy controller) says it is up to the Coastal Commission to decide what is appropriate development in the coastal zone.

Gordon says the issue of the development was aired out before the City Council and the council voted 5-0 to approve the project, apparently referring to the unanimous City Council vote on July 9, 2012 to change the zoning for the former DWP site.

November: District One Councilwoman Ellery Deaton is re-elected. Council members Gordon Shanks, of District Three and Michael Levitt of District Five retire. Shanks has been succeeded by Mike Varipapa, a civil engineer. Levitt has been succeeded by Sandra Massa-Lavitt of the Planning Commission.


March 13: The California Coastal Commission unanimously approves the Bay City Partners residential development project. However, the entire matter would return to a future Coastal Commission meeting because the conditions for the project are not yet clear.

Mayor Ellery Deaton said the commission took a 10-minute recess during the hours-long hearing, giving the applicants scant time to negotiate the conditions for approval of the real estate project. Among the unanswered questions was whether 27 or 28 houses could be built on the land.

Coastal Commission staff had recommended the application be denied.

Sept. 9: The California Coastal Commission approves the conditions that will allow the Ocean Place Development Project to go forward. The project will include overnight accomodations on four lots that were originally slated for residential housing.

Accorcing to Seal Beach Mayor Ellery Deaton, the accommodations will be small cottages similar to a cross between the Seal Beach Inn and Gardens and the historic Anaheim Landing.

The Coastal Commission approved the project in March, but the details for the conditions had yet to be worked out, so the matter returned to the state agency on Sept. 9.

Among those conditions: of the 32 lots originally to be built with single family homes, four would be merged into a single lot to provide overnight lodging. In March, it was not clear precisely how the four lots would be developed. (Later, the potential 28-residential lots expanded to 30.)

Basham said the city would work with the developer designing the overnight accommodations required by the Coastal Commission. Basham believes four cottages would be appropriate and would blend in with the houses.

“The commission loved the proposed overnight accommodation plan with small cottages reminiscent of a blending between the Seal Beach Inn and Gardens and Historic Anaheim Landing,” said Mayor Ellery Deaton.

Another issue is the development of a new city park. Bay City Partners had already agreed to deed the 6.4 acres land for park space before March Coastal Commission meeting. However, paying for the development of the park had not been part of that agreement.

According to Basham, the developers will now pay to build the park.

Basham says that the specific plan for the land would have to be amended to accommodate the conditions imposed by the Coastal Commission.

Oct. 26: The council votes unanimously to “vacate” (give up ownership) a triangular section of First Street at the Marina Drive intersection. The street realignment will apparently result in the loss of 14 parking spaces.

In a related decision, the council also unanimously approves the first reading of an amendment to the DWP specific plan, to allow visitor-serving development of four lots north of Central Way. Another 30 lots, not 28 as previously believed, would become houses after the property owners build a park on the property.

November: As part of the Seal Beach Centennial celebration, a 50-year-old time capsule is opened. Its contents incude a plan for the development of the former DWP property.


July: The city of Seal Beach pays $6,470.50 to AndersonPenna Partners to check the plans for the “Ocean Place” project as it is called by the property’s owners, the Bay City Partners.

Assistant City Manager Gallegos later tells the Sun that the money came from an account that contains Bay City Partners funds, not city of Seal Beach funds.

Early October: Ed Selich, project manager for the Bay City Partners’ DWP development, tells the Sun that he has provided the Coastal Commission with everything it requires to issue a Coastal Development Permit. Now he’s waiting for the state agency to issue the permit.


Friday, Feb. 23: California Coastal Commission issues a Coastal Development Permit for the former DWP property, which will allow the property owners to develop 10.9 acres of land. Of that land, slightly more than 6.4 acres are to be made into a park at the property owners’ expense and turned over to the city before 30 homes can be built on the remaining land.

The Coastal Commission has directed that a small portion of the land has been set aside for overnight lodging in addition to the park and residential lots.

The permit is issued shortly before the Coastal Commission’s origial approval for the project would have expired.

June 11: Escrow closes Monday, June 11, on the former DWP property, according to District One Councilwoman Ellery Deaton, who makes the announcement at the June 11 City Council meeting.

The new owners are Shea Homes.

June 12: Two members of the Bay City Partners decline to say how much Shea Homes paid for the purchase of the land. They confirm the partnership originally purchased the property for $4.5 million.

According to CoreLogic, Shea Homes bought the land for $36.6 million.