Pricey Resort Planned at State Park

State parks officials, with little public scrutiny, are negotiating plans for a $23-million resort in Crystal Cove State Park in Orange County, with rates of up to $400 a night, a restaurant and as many as three swimming pools.

The resort would be developed and run by a private firm on public parkland between Corona del Mar and Laguna Beach under a 55-year contract--making it the longest-running parks concession contract in the state.

The state Department of Parks and Recreation is refusing to make public the resort proposal it selected 16 months ago from among three bids. But in a 1994 document, park officials described the potential for a “boutique resort hotel” at Crystal Cove similar to the Inn at Ventana and Post Ranch Inn in the Big Sur area, two of the most exclusive lodgings on the California coast. Both hotels operate on private land.

Parks officials last week confirmed that the Crystal Cove proposal calls for 60 to 90 units--in refurbished bungalows and new cottages--renting for $100 to $400 a night. That would be a major departure for a parks system better known for rustic campgrounds and picnic tables. The resort could yield $1 million a year for the financially strapped parks department, which is intent on seeking private partnerships and new sources of funds.

With its steep bluffs, tide pools and isolated beach, Crystal Cove is one of the most scenic coastal parks in Southern California. The new resort would be centered in the Crystal Cove Historic District, known for its weather-beaten cottages dating to the 1920s and 1930s. The picturesque beach colony is listed on the National Register of Historic Places as the region’s “last intact example of vernacular beach architecture.”

Campers now pay $10 to $11 a night to stay in Crystal Cove’s three primitive campgrounds, equipped with picnic tables and pit toilets.

Although the state has made no secret of its plans to renovate and rent the cottages, the scope of the project has remained under wraps. Parks officials appear to be “obsessed with secrecy” about the Crystal Cove plan, said one state source who spoke on the condition of anonymity.

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Murray Rosenthal, chairman of the Sierra Club’s state parks committee, called the plan “totally inappropriate,” saying state law rules out park improvements “which are attractions unto themselves, or which are otherwise available to the public within a reasonable distance outside the park.”

He added: “I would say that a resort with swimming pools and other built-in features are attractions unto themselves.”

State parks spokesman Ken Colombini responded: “I don’t think the pool is going to be the destination. The destination is going to be the park, on the beach, with the bungalows.”

The state chose the proposal from Santa Barbara-based Investec over two other bidders in April 1996. When the department asked for plans to develop the resort, it said they would be part of the public record, except for portions marked as trade secrets, confidential or proprietary.

Nonetheless, the department refused last week to make the Investec proposal public. “Unlike most concession proposals, Investec’s proposal is a working document that does not accurately reflect the final contract the department is now developing with the company,” Colombini wrote to The Times. Releasing the proposal now, he wrote, “would, we believe, give the public an inaccurate presentation of the department’s plans for the site.”

The proposal and the contract, now in final negotiations, will be made public after the contract is signed, Colombini said. The public can inspect the plans and comment during the approval process, which will include votes by the state’s Parks and Recreation and Coastal commissions, he said.

Investec did not return repeated telephone calls last week and Monday.

The parks department did agree to respond to written questions from The Times about the planned development. What emerges is a picture of not simply refurbishing old cottages but creating a pricey resort on public parkland:

* The average overnight rate is forecast at $225, with 10% of the units available at a 50% discount.

* Guests would stay in 60 to 90 units in existing bungalows and new cottages, with the exact number of new structures being negotiated. Some units may have kitchens.

* A restaurant would seat 120, and up to three swimming pools would be allowed.

* The project’s cost, initially $14.8 million, has risen to $23 million under the Investec proposal, but could decrease.

* Investec would pay the state 5% of its annual gross receipts for rent. The state anticipates a return of more than $60 million over the 55-year term of the contract, taking into account rent and value of capital improvements.

While most state park concession contracts run for 10 years or less, parks officials last summer received special permission from the Legislature to allow a lease as long as 60 years at Crystal Cove. The longer lease makes the project more attractive to developers, because it allows them time to earn back their investment, Colombini said.

Currently, the two longest park concession contracts run for 40 years--one for a tobacco shop in the San Diego Historic Park, the other for marine services at Lake Oroville.

The state purchased the 2,791-acre Crystal Cove State Park from the Irvine Co. in 1979 for $32.6 million. Under the grant deed, the company has the right of first refusal on any concession proposal within the park lasting more than 10 years. The Irvine Co. will have 60 days to review the proposal once the contract is signed, Colombini said.

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Beach Park Proposal

California may grant a 55-year contract to develop 16.8 acres of Crystal Cove State Park. The project would include refurbishing bungalows that have dotted Crystal Cove’s beachfront hillside since the 1920s. Sixty to 90 units could rent for $100 to $400 per night. Here’s how the area is currently divided:

(Please see newspaper for map)

Other possible additions:

* 5,000-square-foot restaurant with seating for about 120

* As many as three swimming pools

* Visitor and interpretive center in 4.5-acre Los Trancos area

Source: California Department of Parks and Recreation;

Researched by DEBORAH SCHOCH / Los Angeles Times