Vote in discord with finely tuned arts grant

KATRINA FOLEY

In his Feb. 22 rebuttal to Gay Geiser-Sandoval’s criticism of the

council’s decision regarding the Theatre and Arts District Plan,

titled “City of Arts must also know its place,” Councilman Allan

Mansoor has both the law and his facts wrong. Geiser-Sandoval, who is

a lawyer like myself, understands that a development agreement is not

an “exaction” but rather a mutually negotiated contract between the

city and the developers, with each side receiving a benefit. By the

council’s recent decision, the city lost more than $1.6 million of

its part of the bargain.

I agree with Mansoor that our resources should be used efficiently

and wisely, not “fumbled” away. That’s why I proposed the less

complex Theatre and Arts District Plan Alternative. This alternative

eliminated unnecessary bureaucracy and redirected the money committed

to the city away from unnecessary expenditures and requirements and

toward an Arts and Music Scholars Grant for Costa Mesa students -- a

much needed community benefit.

The developers, Planning Commission and Cultural Arts Committee

all liked the concept; most importantly, the residents in our

community liked it. Four members of the council did not. Instead, the

council preferred an alternative that reduced the city’s benefit of

its bargain by returning more than $1.6 million to the developers. I

strongly object to the council majority’s mishandling and fumbling

away of more than $1.6 million of public funds that were committed to

the city as a community benefit.

Councilman Mansoor justified his decision by stating his fear of

future taxes and fees and saying he did “not believe it was proper

for us to just use it for anything else we desire, so it went back to

its original owners to use for their designated upgrades.” Not even

the developers could believe that they would receive such a windfall.

If they did not like the idea of an Arts and Music Scholars Grant,

not only was it proper to find another use for the money, it was the

council’s duty. The money is not a tax or fee but rather a bargaining

term agreed to by the developers and committed to the city. Due to an

absurd oversimplification of the issues, and lack of legal

understanding of development agreements, the residents of the city of

Costa Mesa once again lost out.

Mansoor is also wrong when he states, “that most development

agreements have to do with infrastructure upgrades and trip fees

normally go toward street improvements.” In fact, infrastructure

upgrades and trip fees are actually city requirements of every new

development separate and apart from those limited situations where a

development agreement is negotiated. The purpose of the development

agreements here was to provide a benefit to the developers, by

allowing both additional building rights and a freeze of existing

development laws and fees for the next 20 years -- including the

then-existing planning, zoning, and development codes (i.e., parking

requirements, allowed density, building height, etc.), traffic and

other fees in existence on March 5, 2001. All in exchange for what

the city deems “community benefits.” The significance of the bargain

for benefits cannot be understated. If South Coast Plaza waits 19

years to build its 200-room luxury hotel and 21-story office

building, the city is obligated under the development agreement to

allow the development to proceed based on laws and fees in place on

March 5, 2001, without consideration for increased traffic impacts,

public safety costs and other unknowns.

Community benefits can vary depending on the development, needs of

the city, and, or, community requests. For example, in the proposed

development agreements at issue, the monetary contribution of $2.2

million (plus 7% interest since March 5, 2001) to the creation of a

Theatre and Arts District Plan was only one of the terms negotiated.

The city and developers also negotiated the following additional

community benefits: South Coast Plaza granted six acres of land for

the performing arts; Henry Segerstrom contributed $40 million to the

design and construction of the new symphony hall; a permanent open

space easement was offered; Town Center Drive was given by South

Coast Plaza to go from a private to a public street, which the

developers agreed to maintain; a payment of $.285 per square foot of

new development toward fire protection facilities was offered;

discounted parking for patrons of the arts and residents in the

developers’ current and future parking lots was offered; and the

developers also agreed that the Noguchi gardens remain and be

maintained for 50 years. Under Mansoor’s logic, all of these

negotiated items could be considered “exactions.”

As a resident and a homeowner, with a family living in Costa Mesa,

I have serious concerns about the pattern developing with recent

decisions by the council regarding public funds. First, they settled

a lawsuit for an unheard of $750,000 -- in which most of the money to

come from the city’s workers’ compensation account. As an attorney, I

can tell you that news of the early settlement sent shock waves

through the legal community and raised the question, “What were they

trying to hide?”

Next, they gave $1.5 million in redevelopment funds to help the

developers of 1901 Newport Boulevard. That’s $1.5 million dollars

less for the city to improve the Westside and existing substandard

housing.

Now, the council majority returns more than $1.6 million in

negotiated public funds back to the developers to help them develop

their properties. The most distressing aspect of this last decision

was that the developers did not ask for the money back and had

generously, voluntarily and freely agreed to redirect at least

$300,000 toward a Arts and Music scholars program for Costa Mesa

students. Oh well.

Despite this setback, I am optimistic and confident that we can

still make the Arts and Music Scholars Grant program happen for the

children of Costa Mesa -- stay tuned.

* KATRINA FOLEY is a Costa Mesa Planning Commissioner and the lead

official on the Arts and Music Scholars Grant program proposal.