Obstacles Stymie Seaside Dream

Building projects often take longer than they should, any developer will tell you.

But Neil Werb never imagined that after 12 years he’d be standing on the same patch of dirt where he planned to build his dream house, with nothing to show for it.

Werb, a Malibu real estate lawyer, and his friend John DeFalco, a Fullerton-based manufactured-housing developer, figured they couldn’t go wrong when they put $2 million toward the purchase of 73 acres overlooking the beach at the southeastern edge of Ventura County. That was in 1988.

Then in his 60s, Werb said he and DeFalco dreamed of retiring on that hillside perch across Pacific Coast Highway, with its panoramic view of the ocean. Under the name Skylark Investment, they’d bring in a couple of investors, develop nine luxury home lots on the property and make enough money to cover the cost of their own houses. The whole thing would take about three years, Werb believed.

“We thought it was a good deal. We didn’t realize what problems would ensue,” he said.

Twelve years and $5 million later, Skylark and its investors have yet to gain permission to pave a road or run water lines, much less sell off parcels of land.

The obstacles have been endless. There were the NIMBYs (not in my backyard). The water and septic issues. The crippled-children’s camp. The Native American preservationists. And, finally, a slew of code violations that nearly strangled the project.

Skylark’s project has become a textbook case on the problems developers can encounter when they want to build along California’s scenic coastline, say Ventura County planners.

“It goes back to the old caveat emptor: Let the buyer beware,” said Paul Merrett, the planner who has overseen the Skylark project for the last decade. “If someone’s going to develop property on the coastal zone, they might want to talk to the developers on this one first.”

County zoning divides Skylark’s land into three sections: a 57-acre parcel of coastal open space, a nine-acre residential tract and a seven-acre mixed-use plot that includes

Neptune’s Net--a popular shrimp shack along the highway where bikers, surfers, movie stars and day laborers regularly converge over beer and seafood platters.

Originally, DeFalco wanted to build more than nine houses. He envisioned developing a 194-unit RV park on the large open-space parcel. Homeowners in the neighboring beach community known as County Line were outraged at the prospect. They saw it as a threat to their water supply, their property values and the quiet, laid-back lifestyle they enjoy.

The developers faced other concerns: The area is prone to brush fires, the Skylark property sits in the county’s coastal zone, and the property is considered archeologically sensitive, because it was part of a Chumash Indian settlement.

Development is also made difficult because the area relies on septic tanks. Water for drinking, irrigation and firefighting comes from a well.

When DeFalco and Werb bought the land, they also took over the small Yerba Buena Water Co., sole provider to the 200-plus homes in the area. The theory was that the best way to ensure water for their project was to control the water company.

But in acquiring Yerba Buena, they also inherited the existing customers and their beefs with the company--including its aging equipment, slow service and pattern of delinquency in testing.

Early on, county officials said traditional on-site sewage disposal wouldn’t work because of bedrock and other soil factors. An alternative would be to build a small treatment plant, according to the county’s Environmental Health Department.

When Skylark floated that idea, neighbors balked. Camp Joan Mier, which flanks Skylark’s property and was run by the Crippled Children’s Society, served as a lightning rod. Opponents painted a disaster scenario in which nearby disabled children would be exposed to waste water.

“It’s drip irrigation,” said Yerba Buena President Bob Berry, who is frustrated at how opponents characterized the issue. “You don’t spray effluent.”

The RV park plan was soon abandoned.

Skylark then found extending water to nine home lots wouldn’t be easy.

The developers needed the blessing of the California Public Utilities Commission. They wrangled with the commission over whether waste could properly be disposed of with septic tanks on the land and whether Yerba Buena had sufficient water power to fight fires. The case ended up before an administrative law judge who retired before making a ruling.

In 1993, the judge who inherited the case sided with the water company. But some neighbors still believe there is insufficient water to fight a major fire.

Supervisors Gave Tentative Approval

In November 1996, the county Board of Supervisors gave tentative approval to Skylark’s project, with a slew of conditions that have continued to bog it down.

The county required the developer to fix all building code violations at Neptune’s Net, even though they preceded Skylark. The county became aware of the violations in 1991, when the business was sold by its longtime owners to Michelle and Chong Lee of Agoura Hills.

According to the county, Neptune’s large covered deck was built without a permit, as were a walk-in cold storage area, four portable toilets and their enclosure. Also, the septic system, built in the 1950s, was backing up frequently during the busy summer months.

Werb and DeFalco didn’t see these as their problems, but rather those of the Lees.

The county saw things differently. Though the Lees had a 99-year lease on the property, Skylark owned the land and so was deemed responsible for the code violations. County officials believed their only chance to clean up the restaurant was to hold Skylark’s plan hostage.

“The way we get leverage to correct violations is we don’t give permits,” said Merrett, the county planner for the Skylark project. “It’s the only window of opportunity we have to address things like that.”

These problems weren’t easy to fix. The deck amounted to an illegal expansion, the county said. The only way to fix the problem was to remove the deck. But that would be disastrous, the Lees said.

“The patio is 80% of the business,” Michelle Lee said. “People are coming here for the ocean view.”

The Lees sued the previous owners. A settlement took more than five years. The county is letting the Lees keep the deck, provided they reduce the flow and concentration of restaurant effluent to levels found in residential septic systems. The portable toilets and their enclosure were approved, after fortification.

As this battle dragged on, Skylark was making plans to remove three large subsurface concrete tanks on the lot, formerly used to house live lobsters.

The developers called in a crew to remove the tanks and smooth out the land. But they did it without an archeological assessment required to ensure no Native American artifacts would be disturbed. To make matters worse, Skylark’s work crews ignored the president of the Californian Indian Council Federation, who went to the site and asked them to stop. That earned Skylark a citation from the county and the ire of Native American activists and neighbors already opposed to the project.

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As tensions escalated, one opponent found what appeared to be a remain on site. It turned out to be a chicken bone.

By 1997, tired of stumbling blocks, Skylark entered negotiations to drop its plans and sell the land to Camp Joan Mier. Talks fell apart when the two sides couldn’t close the gap between the $5 million the developers wanted and the $3.7 million the camp was willing to pay, said Richard Greenig, vice president for AbilityFirst, formerly the Crippled Children’s Society.

Pamela Campbell, a neighboring homeowner and longtime Skylark opponent, said she’s dissatisfied with the water company’s service and fears it lacks adequate water to fight fires.

She and neighbors called in the county after a broken water line caused leaks and cracks on Tongareva Street and the water company dragged its feet on repairs, she said.

“It wasn’t our line; it was a customer’s line,” Berry said. “It should be the customer’s responsibility, not ours.”

Neighbors also have complained of reddish-brown water, most likely a harmless amount of excess iron, state inspectors said.

Two years ago, Yerba Buena’s water tested positive for coliform, an indicator of fecal contamination. Follow-up testing turned up negative, but the company didn’t do as many repeat tests as necessary, the state said. This spring, the state learned the company was overdue for most chemical sampling--lead and copper, radioactivity, inorganic chemicals and nitrates.

Mir Ali, an engineer with the state Department of Health Services, said the company’s problems seem to be with management, not water quality. By early July, most of the delinquent tests were completed and the water pronounced “absolutely safe,” Ali said.

In June, Yerba Buena was permitted to its raise rates. At the same time, the state Public Utilities Commission ordered the company to drill an additional well, which should ease neighbors’ concern about adequate water supply.

But Campbell fears Skylark won’t stop at nine homes. Since the plans for the RV park and sewage plant, “Skylark Investment [and] Yerba Buena Water Co. have a pattern of behavior that has not engendered trust within our County Line community,” Campbell said.

DeFalco and Werb said they believe a portion of Skylark’s land might one day make for a nice bed-and-breakfast or a nine-hole golf course. But they have no plans at this time, and Werb acknowledged such a proposal probably would also face resistance.

Madelyn Glickfeld, a former member of the California Coastal Commission, who teaches land use and coastal zone management at UCLA, said she’s not surprised Skylark’s project has been stalled for so long.

“It’s hard to develop in a place where there’s no services and an active constituency who doesn’t want to change a place that’s pretty rural,” she said.

If not for a sympathetic county Board of Supervisors, which voted June 20 to change county law to grant the developers a time extension, Skylark would have been forced to start the approval process again.

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The developers had missed the three-year deadline for recording a project map with the county. After hearing the testimony of Skylark’s engineer, supervisors decided the developers were making a good-faith effort to meet their obligations. The board agreed to rewrite the law in a way that probably will conform to the state’s looser standard.

“I would not envy anybody in the development business nowadays,” said Supervisor Frank Schillo, whose district includes Skylark’s property. “They’re faced with a formidable task of getting the thing accomplished.”

Even with the reprieve and county support, Skylark has months of work, along with lingering complications, before it can subdivide the land and sell it off.

“We should come out OK, but not as well as we’d expected,” Werb said. “Hopefully, we won’t lose money.”

On a recent afternoon, after lunch at Neptune’s Net, Werb stood planted in the dirt on Skylark’s property, looking wistfully out to sea. At 77, he no longer has visions of building his dream house at the site.

“I’m too old now,” he said.