Balboa Marina and Public Docks Get Final OK

A project for new public docks and improvements to an existing private marina that’s been in the works for about a decade received unanimous county approval this week.

The Orange County Board of Supervisors voted 5-0 Tuesday (Dec. 20) in favor of a lease agreement with The Irvine Company for construction of public docks in county tidelands property at 201 East Coast Highway. The county tidelands aren’t currently used and there is no direct access to the shore as the water between county tidelands and the shore is controlled by TIC.

The entire project (previously approved by the city and the California Coastal Commission) entails landside and waterside development, including improvements and expansion to the existing facilities at Balboa Marina, a new restaurant, and a redesigned parking lot.

On Tuesday, the OC supervisors only considered the county tidelands where some of the slips are located, not the entire project. Their action also included approval of a lease agreement with the city of Newport Beach and a resolution finding the county tidelands property as exempt surplus land.

The marina and public docks project in Lower Newport Bay, just south of where Pacific Coast Highway crosses the bay, will increase public access to recreational opportunities, supervisors agreed.

The project is a great deal for the county and the public at large, said Supervisor Lisa Bartlett, whose recently redrawn district now covers Newport Beach. The Irvine Company will bear the entire multi-million cost and obtain the necessary permits.

“The project will provide public benefit boat slips, side tie slips, that do not exist today,” she said. “Additionally, the county will receive consistent, incremental monthly revenue based on a market rate study.”

BOS Vice Chair Don Wagner, who previously represented Newport Beach during his time as a California State Assemblyman, was happy to see the project before them in its final steps after so many years.

“This is a long-standing project and it is great to be able to see it come to fruition,” Wagner said. “My hat’s off to everybody who’s gotten this done.”

“It is a testament, I think, to the way government ought to be done,” with the county, city and private entities working together and bringing something to the public that is very much wanted and needed, he added.

Plans include construction of a public dock consisting of 12 no-cost public use side ties (seven are located in approximately 7,436 square feet of county tidelands, which is the reason the project needed county approval). Once construction is complete, TIC will donate ownership of the public dock to the City of Newport Beach. The city will manage the maintenance and operations of the public dock.

The Irvine Company will also add 26 private boat slips, of which will be five full slips and two partial slips.

Under the option agreement, TIC must pay an option fee of $10,000 to the county upon the approval. The option term is for 12 months. Should TIC need more time to satisfy all of the conditions, an option to extend the term for an additional 12-month period is included in the agreement.

The agreement also requires that TIC pay the county a monthly rent of $3,500. The rent will be automatically adjusted by 3% every three years. Every 10 years, the rent will adjust by the greater of fair market rent or proportionate changes in the Consumer Price Index (10-year revision). Rent under the lease will not decrease and any rent increases under the 10-year revision will be capped at 5%.

The term for the TIC lease is 30 years and has an option to extend for one 15-year period. At no time shall the lease exceed the maximum lease term of 50 years as authorized in the tidelands grant.

The project has predated Newport Beach Mayor Noah Blom by many years, he said during public comment at the OC Board of Supervisors meeting on Tuesday.

Newport Beach City Council initially heard a conceptual review of the project in March 2012. The council unanimously approved the project in December 2014.

In February 2017, the California Coastal Commission unanimously approved the project with 17 special conditions that focused on protecting sensitive animal and plant species, and public access.

In 2016, The Irvine Company approached the county to negotiate use of county tidelands for the project. After conducting CEQA mitigation work, TIC contacted the county again in August.

The portion of the project on the supervisors’ agenda on Tuesday were the seven slips on county jurisdiction and the costs associated with that, Blom said.

“We’ve kind of hit a hang-up where we’re looking to really finalize this project and I think 10 years is a decent amount of time to build a few boat slips,” Blom said. “More so than that, I think this is a great element for the county. We are greatly underserved in that section of Newport.”

There is no public dock space available near that location, he added.

This is something The Irvine Company will take on at their own expense, but will be used by all county residents and visitors to the harbor, he noted.

It’s something the community has really been pushing for, Blom said.

“The city asks that you look forward to making this a reality after 10 years on the drawing board so that we can get more public access down there, get more people from the county enjoying our harbor,” Blom said. “I think that’s the goal for all of us. It’s a win-win public-private partnership.”

During the supervisors’ discussion of the item, County Counsel Leon Page announced an amendment to the lease with the city proposed by Supervisor Katrina Foley. The change would require the city, in addition to its obligations to the Americans with Disabilities Act, to also provide disabled members of the public with access to a wheelchair lift so they can board boats.

Foley, whose district covered Newport Beach before being redrawn and recently won re-election for the new district five, which now includes NB, recalled a meeting with city officials who agreed to the additional terms, she said. The city has a wheelchair lift at Marina Park, which is likely similar to what they’ll use at Balboa Marina. The problem with a permanent structure is that kids might use it as a recreational amenity and it would be hard to ensure that its maintained, Foley noted.

The drafted language in the amendment incorporates that agreement, she said.

Bartlett included the wheelchair lift amendment to her motion, which was ultimately approved.

Foley also commented that after the project was continued from the previously scheduled December 6 meeting, her team researched the details of the agreement.

“Since that time, we’ve worked pretty diligently to try to understand the project, try to understand how the county came up with rate, to understand where the rate formula was derived from,” Foley said. “What we’ve gathered is that there was a 2016 Newport Beach appraisal that was done for a different set of docks, not related to this set of docks, and so that formed the basis for a discussion about the valuation.”

There was no updated appraisal conducted, she added.

“The county doesn’t actually have a rate system,” for usage of the tidelands, Foley explained, pointing out the system that Newport Beach uses is posted online. “We don’t have anything like that, this was just individually negotiated with The Irvine Company.”

Although Foley’s concerns and comparisons were geared more toward application on future negotiations and potential lease agreements rather than the current deal. She isn’t sure what method would work best to calculate the tidelands rate system, but she looks forward to working on improving the method.

“I’m not sure what’s the best, a fixed rate or a gross receipts rate, but what I do know is that we don’t have a current system in place at the county so that it’s the same for everyone,” Foley said. “I hope that in the future we could come up with a rate system that’s fair.”

She noted the changes in the rental rate that occurred during negotiations.

The first amount that the county put forward was $5,500 per month. It was somehow whittled down to $2,500 a month and then that changed to $3,500 month

“It just seems like it was very arbitrary,” she said.

It’s “obvious” why we went from $5,500 to $2,500 to $3,500, Wagner replied.

“That’s called negotiations and that’s what happens when you are negotiating an agreement behind the scenes,” Wagner said. “The problem is we’re here; it sounds like now (we’re) trying to negotiate an additional change in public and, more importantly, without necessarily hearing from the other side as to whether this is acceptable or not.”

Shawna Schaffner, CEO of CAA Planning, Inc., representing TIC commented and confirmed they are aware of the amendments, both the addition of ADA access to a wheelchair lift at the public dock and the increased rent at the private slips.

“We find those amendments acceptable,” she said.

Foley also pointed out that the county entered into a similar agreement for 50 slips nearby the current project and the lease is more than $6,000 for those.

Although a different leaseholder owns those 50 slips, Bartlett pointed out, and, like real estate, location matters. Those 50 slips are in a prime location where the market rate would naturally be higher, while the slips under consideration by the supervisors aren’t in an ideal spot, she explained.

Considering everything in its entirety, including market rate for that particular location, the real estate department did fine job and it makes a lot of sense, Bartlett said.

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Sara Hall covers City Hall and is a regular contributor to Stu News Newport.

Source: Stu News Newport Balboa Marina and public docks get final OK