Half Moon Bay City Council applauds new Beachwood deal

0 Comments | Oakland Tribune, Aug 20, 2008 | by Kyveli Diener

HALF MOON BAY -- The City Council has given its undivided support to a proposed compromise that would end a dispute over the Beachwood property, a 24-acre parcel just east of Highway 1.

The deal, which the council discussed Tuesday evening in closed session, would award ownership of the land to the city for use as a park along with a total of $15 million to help pay off the $18 million owed to the current owner, developer Charles "Chop" Keenan.

Under the settlement, which state Sen. Leland Yee, D-San Francisco, unveiled Friday, the city would be granted Beachwood for use as a public park. The city would then receive $10 million in Proposition 1C funds, all of which would be used to repay the debt to Keenan, according to Mayor Bonnie McClung.

The city would also receive $5 million from the Association of Bay Area Governments, the maximum award under the city's insurance to pay for legal fees and litigation incurred over the course of the Beachwood case.

"The council unanimously supports the legislation as long as we have a firm $10 million -- and that the intention of the legislation is to give us $10 million to have Beachwood be a park," McClung said. "I'm grateful to the senator and the leadership in the Senate for coming up with this solution."

Keenan had planned to develop the land for housing until protected wetlands were found there in 2000. In 2007, a federal judge blamed Half Moon Bay for the creation of the wetlands due in part to a faulty storm drain system and ordered the city to pay Keenan $41 million.

The city eventually settled on a bill authored by Assemblyman Gene Mullin, D-South San Francisco, that would have given Keenan the use of the land for development in spite of the wetlands. If the bill, AB 1991, failed, the city would have to buy the land from Keenan for $18 million, according to an agreement between Keenan and Half Moon Bay.

AB 1991 received strong opposition from environmentalists, who felt the wetlands should be protected and is currently stalled in the Senate. Keenan said Wednesday that he'd supported AB 1991 because "it was in my financial self-interest (to develop) as well as the city's."

"AB 1991 was a better deal for both the city and for me," Keenan said. "The deal we settled on when we settled this litigation was A or B. It was AB 1991 or $18 million. And it looks like we're going to get B instead of A."

Yee, who did not support AB 1991, said he is happy to have found a solution that is "workable for everyone."

Yee said he plans to introduce an amended bill outlining the new deal today in the Assembly.

"The difficulty with 1991 was that there was so much opposition that there was no way 1991 was going to pass at all. The compromise that I've been able to structure I think is a win-win for everyone," Yee said. "Hopefully we will now roll up our sleeves and work together as a unified force to get this particular bill passed."

Sara Ramirez, a spokeswoman for Mullin, said the assemblyman is "happy that the senator is on board" with Mullin's goal of aiding the city.

"We're just happy and hopeful that it looks like there might be some relief for Half Moon Bay," Ramirez said. "Mr. Mullin has worked very, very hard to help the city."