Part III: Looking back at how the Marina was createdhttp://www.argonautnewspaper.com/articles/2010/04/15/columns/helga_gendell/h.txtBY HELGA GENDELL
(Created: Wednesday, April 14, 2010 2:58 PM PDT)
Part III of the history of Marina del Rey covers actions taken after Los Angeles County supervisors requested that the Regional Planning Commission conduct a study to determine the economic feasibility of a recreational harbor.
All of the following historical information is cited from “The Urban Marina: Managing and Developing Marina del Rey,” by Marsha V. Rood and Robert Warren of the Center for Urban Affairs Sea Grant Program and published by USC.
A letter from Robert T. Stevens, secretary of the Department of the Army to the speaker of the House of Representatives, dated August 8th, 1952, included a report from the Department of the Army, chief of Engineers [Lt. Gen. Lewis A. Pick].
Stevens said the preliminary examination and survey of the harbor at Playa del Rey and a review of reports on the Playa del Rey Inlet and Basin near Venice was intended to determine whether any improvement of the location was warranted at the time as authorized by the River and Harbor Act approved on August 26th, 1937, and requested by a resolution of the Committee on Commerce, United States Senate, adopted on June 2nd, 1936.”
“The Bureau of the Budget advises that while there is no objection to submission of the report to Congress, authorization of the improvement recommended herein would not be in accord with the program of the President [Eisenhower] unless the federal participation is limited to 50 percent of the cost of the generational navigation facilities,” stated Stevens’ letter.
In response to Stevens’ letter, Donald Belcher, assistant director of the Bureau of the Budget, Executive Office of the President, wrote back saying, “The Chief of Engineers [Pick] considers the proposed federal participation in the project appropriate ‘if it is the intent of Congress to provide federal assistance in the development of recreational boating facilities of the type proposed in this report.’”
Pick’s report included several points such as “relocation of the oil wells, construction of public facilities, providing adequate berthing and other facilities for small craft, and establishing a public body to regulate the use and development of the harbor facilities which shall be open to all on equal terms.” According to the report, “the proposed improvements are designed to meet recreational boating needs and are not significant from the standpoint of commercial navigation.”
Belcher pointed out that in his 1955 budget message, President Eisenhower had stated, “To the greatest extent possible, the responsibility for resource development, and its cost, should be borne by those who receive the benefits.”
Belcher said that the benefits of the Playa del Rey Harbor would be largely local, but would make no contribution to the cost of the general navigation features of the project.
He said that the federal share of the costs of all recreational harbors should be limited to no more than 50 percent of the first cost of providing general navigation facilities, which in the case of Playa del Rey appeared to include the jetties, entrance channel, interior channel and central basin.
After congressional authorization of the project, development of Marina del Rey was a priority for the county in financial, planning and administrative terms, and on September 23rd, 1954, the county created the Department of Marinas and Harbors, subject to the authority of the Los Angeles County Board of Supervisors.
Although these powers were quite broad, the new department’s initial role was primarily one of assisting private consultants in developing the Marina.
As local sponsor of the project, the county would assume responsibility for three-fourths of the cost. Consequently, the Board of Supervisors authorized a study of the project’s economic feasibility and available financing methods.
Funding the Marina through general obligation bonds would have required that the bond issue be approved by a two-thirds vote of the electorate. Revenue bonds, on the other hand, needed the approval of only a majority and did not obligate the county’s general fund. A specified amount of revenue from the Marina’s operation would be designated for their redemption.
In March 1955, the Board of Supervisors hired George Nicholson and Company to “prepare a schematic plan for the facility and to conduct an economic feasibility study.”
Nicholson’s firm, along with the assistance of the Department of Marinas and Harbors, “was directed to reduce the Marina’s total cost and to increase the amount of land available for revenue-producing activities.”
In March 1956, Nicholson’s report stated that the project was economically feasible and provided the general rationale for undertaking it. The report included:
The 1955 population estimate of five million on the Southern California coast, and projections of future population growth;
The shortage of anchorages in the area, Los Angeles, Long Beach, and Newport harbors being the only existing facilities for small craft;
The inadequate arrangement for small craft at the predominantly commercial Los Angeles and Long Beach harbors;
The high cost of transportation to Newport Harbor;
An expanded demand for mooring space due to increases in population and boat ownership; and
The constraint of boat ownership in the area due to limited mooring space.
Nicholson’s report found “that the anticipated increases in annual tax returns from the Marina’s operation would justify the county’s spending $12.6 million for site acquisition and approximately $9.6 million for construction. Nicholson concluded that the possible future revenues justified a “rapid and bold program of acquisition and construction at the earliest possible date.”
Nicholson’s report also included a new physical design for the harbor, “Alternative Schematic Plan No. 2,” which had been adopted by the Board of Supervisors on February 21st, 1956. The revised plan altered the shape of the harbor, discarding the sailing lagoon (elliptical basin) for a straight main channel with seven moles.
The new design addressed the Marina’s cost problem in two ways; it decreased the total area from 1,170 acres to 918 and increased the amount of land from 453 acres to 508.
This had the effect of making more revenue-producing land available while actually lowering the site acquisition costs, the report stated.
As its first action, the county began acquiring rights-of-way for the project and designated $1,373,074 for initiation of the proposed project. The US Army Corps of Engineers, however, made further changes in the design
when it formally approved the agreement.
In its “Design Memorandum No. 1, General Design for Playa del Rey Inlet and Harbor, Venice, California,” dated November 1956, the Corps further reduced the total acreage for the proposed harbor from 918 acres to 824 acres.
The amount of water acreage, however, was increased from 410 to 451 and the amount of land acreage was reduced from 508 to 373. As can be seen from a comparison of maps, the major land reduction was in the area bounded by Lincoln Boulevard, Basin H and the Ballona Creek Flood Control Channel.
The Corps’ plan called for 6,200 mooring slips and provisions for 2,000 trailer-mounted craft. This was a greater number of slips per water acre than its previously approved plan for 8,000 slips utilizing 717 acres of water.
The design eliminated the sailing lagoon that precluded the use of the Marina by small boats seeking protected waters and/or recreational areas.
This authorized redesign officially changed the basic character of the Marina from a traditional recreational harbor to a berthing facility whose waters would be used primarily for entrance and exit by larger recreational craft.
The initial decision of the county to eliminate the sailing lagoon and the actions of the Corps in making official design changes took place without public hearings.
There was an increase in the proposed local share of almost $4 million and a reduction in federal involvement of almost $3 million between 1954 and 1958 because of final modifications in design involving dredging, realignment of roads and adjustment of beach lines.
The county proposed to meet its obligation by a resolution submitted to the electorate on November 6th, 1956, calling for the issuance of $13 million in revenue bonds to finance small boat harbor improvements and facilities for the public’s convenience.
The voters approved the measure by a two-to-one margin. In addition to the bonds, the Board of Supervisors allocated $15 million from the county general fund for land purchases and borrowed $2 million from the State of California to provide its share of Marina funding.
On November 18th, 1958, a deed for “Perpetual Right-of-Way and Easement” between the County of Los Angeles and the United States of America was signed by Burton W. Chace, chairman of the Los Angeles County Board of Supervisors.
Land for the Marina was acquired between 1957 and 1959, primarily from private parties through condemnation or negotiated sales.
All but a small portion of the area was located in unincorporated territory under the direct jurisdiction of the county.
Several uninhabited parcels of land included in the project were owned by the county, but were within the City of Los Angeles. By agreement, these sections were disincorporated from the city in December 1960.
Looking back at how the Marina was created: Part IVhttp://www.argonautnewspaper.com/articles/2010/04/22/columns/helga_gendell/hg.txtBY HELGA GENDELL
(Created: Wednesday, April 21, 2010 3:28 PM PDT)
Part IV of the Marina del Rey history covers actions taken after several uninhabited parcels owned by Los Angeles County but located in the City of Los Angeles were disincorporated from the city in December 1960.
Marina del Rey had become an authorized federal project under the Omnibus Bill, Public Law 780 (signed by President Eisenhower in 1954) — that stated, “Playa del Rey Inlet and Harbor, Venice, California: House document 389, 83rd Congress: Provided, that federal participation in the provision of entrance jetties, entrance channel, interior channel and central basin recommended in the project report and presently estimated to cost $7,738,000 shall not exceed 50 per centum of the cost thereof.”
In a preliminary examination and survey of the area years earlier, Lt. Gen. Lewis Pick, chief of engineers for the Department of the Army, said, “The proportion of federal and non-federal participation recommended by the Board of Engineers for Rivers and Harbors is considered appropriate if it is the intent of Congress to provide federal assistance in the development of recreational boating facilities of the type proposed in the report.”
The report also stated, “The proposed improvements are designed to meet recreational boating needs and are not significant from the standpoint of commercial navigation.”
According to Pick, local interests consider that the proposed harbor would be an integral unit of an adopted general plan for development of the Santa Monica shoreline.
“The plan includes widening and improving beaches, providing adequate bath houses, parking areas, picnic facilities, special recreation centers, bathing and wading beaches, fishing piers, youth organization camps, tourist parks with cabin and trailer accommodations, and a bird refuge; and
“Provide without cost to the U.S. all necessary slips and slip facilities and facilities for the repair, service, and supply of small craft on terms reasonable and equal to all; and secure and hold for public interest lands bordering on the proposed improvement to a depth sufficient for the proper functioning of the harbor.”
In subsequent discussions between Pick and the U.S. Army Corps of Engineers, it was stated that local interests had requested provision by the U.S. of a harbor for small craft as part of a comprehensive plan for park and beach development including recreational boating facilities, emphasizing the need for adequate facilities for small craft in the Santa Monica Bay area and nearby districts.
In these communications, it was stated that the district engineer found a need for additional harbor facilities for small craft in Southern California, particularly in the Santa Monica Bay area.
Pick estimated that, on the basis of the California average of 2.79 boats per 1,000 population, the immediate tributary area would sustain about 6,500 small craft, and on the basis of the Los Angeles average of 1.6 boats per 1,000 population, the remaining tributary area would sustain an additional 960 craft.
“The Board of Engineers for Rivers and Harbors concurs in the views of the reporting officers that a need exists for a harbor with an ultimate capacity of 8,000 small craft in the vicinity of Playa del Rey.”
“The plan recommended by the district engineer together with work to be performed by local interests will provide a suitable improvement. Total benefits are sufficient to justify the expenditure required,” said the Board of Engineers.
“The board believes that in addition to the evaluated benefits resulting directly from construction of the small boat harbor, benefits would accrue to local interests from the use of the area as a park facility.
“It can be expected that the area will be visited and enjoyed by many persons in no way connected with small boat commerce.”
The construction of Marina del Rey for the purpose of recreational small craft boating later ran headlong into financial expectations and difficulties when the Marina’s inability to attract investors created considerable fear about not meeting a $13 million revenue bond obligation.
According to “The Urban Marina: Managing and Developing Marina del Rey,” the county proposed to meet its obligations by a resolution submitted to the electorate on November 6th, 1956, calling for the issuance of the revenue bond obligation to finance small boat harbor improvements and facilities for the public’s convenience.
The voters approved the measure by a two-to-one margin. In addition to the bonds, the Board of Supervisors allocated $15 million from the county general fund for land purchases and borrowed $2 million from the State of California to provide its share of Marina funding.
The county lobbied the California Legislature’s 1958 session to change a law that placed a ten-year limit on granting concessions in projects financed in whole or in part by revenue bonds.
The county expected that the ability to enter into longer-term lease agreements would increase the marketability of the bonds as well as allow their sale at a lower rate of interest. The legislature was responsive and amended the law to permit leases of up to 60 years, after which leasehold facilities reverted to the county.
Since the bond obligations were to be met by rents from concessions in the Marina, the profitability and stability of potential uses became of major concern in the economic feasibility study conducted by county consultant Coverdale and Colpitts.
In the consultant’s study, the firm inspected 60 marinas and yacht clubs along the Pacific coast, the Great Lakes and the Florida coast. The most successful marinas were developed in proximity to heavily populated urban areas.
This finding was used as a basic factor in justifying the suitability of the Los Angeles area for supporting a marina.
The firm also gathered data on ship chandlers, ship brokers, small boat repair yards, clubs, marina fuel stations, launching areas for small boats, cabanas and trailer-cabanas.
Subsequently, Coverdale and Colpitts recommended that all these facilities be included in the Marina. The firm did not consider residential developments as a potential use in the project.
After the Corps of Engineers completed the engineering work on the Marina channel and the procedures for issuing revenue bonds were established, the main focus of county activities became site leasing.
Once underway, the pattern of events produced several changes in the formal organization for managing the Marina.
In December 1959, the Board of Supervisors appointed Victor Gruen Associates to develop a land use plan for the Marina that could be used as a guide for soliciting and evaluating lease bids.
Gruen submitted a “Development Plan for Marina del Rey Small Craft Harbor” the following May and revised it in September 1960 to respond to the reactions of the investment community.
Gruen developed the plan to allocate revenue-producing uses recommended by Coverdale and Colpitts. One major addition was the option of building apartments on some parcels.
The document detailed the parceling of the land and related the uses to one another with respect to circulation and density.
Gruen’s work was conducted independently of the Department of Small Craft Harbors although the department did provide support and assistance (in May 1959, the department name was changed from Department of Harbors and Marinas to Department of Small Craft Harbors).
As in the case of Coverdale and Colpitts, a primary goal in the Gruen design was to enhance and protect the revenue-producing capability of the Marina, and thus the county’s ability to meet its debt obligation.
The appointment of a Marina harbor controller and a property manager was the next step in the process. They assumed the responsibility for writing leases based on the Gruen land use plan and issuing lease bids in response to current market demand.
All three consultants for the Marina — George Nicholson, Coverdale and Colpitts and Gruen Associates — had recommended that aesthetic standards and landscape quality be maintained by a review and approval process for any structures to be built.
On February 23rd, 1960, the Board of Supervisors adopted an order appointing a Design Control Board (DCB) “to assure conformity on the part of successful bidders who may construct improvements within the Small Craft Harbor.”
The Design Control Board was formed as an autonomous body whose decisions could only be reviewed by the Board of Supervisors and whose membership consisted of two architects and one businessman.
To establish basic design and construction criteria for the lessees, the supervisors approved and adopted the Marina del Rey “Specifications and Minimum Standards of Architectural Treatment and Construction” on January 3rd, 1961.
The Marina del Rey lease form binds lessees to accept these architectural standards (and amendments) and to acknowledge the authority of the Design Control Board over their project designs.
This basic organizational structure might have continued (supervisors, DCB and Department of Small Craft Harbors) had problems not arisen over the leasing procedures.
The department put 13 parcels up for bid in January 1961, but there was much less competition than predicted by the consultants, and only three of 13 parcels finally leased had more than one bid.
Rex Thompson, director of the department, blamed the slow start on the current economic recession and the fact that potential lessees were unable to obtain Federal Housing Administration (FHA) guaranteed loans.
This poor showing in lease bidding created concern among bondholders, and in July 1961, bondholder representatives met with individual county supervisors several times.
Ernest Debs, chairman of the Board of Supervisors, expressed doubts that the board was adequately informed by the department and suggested that to remedy the problem, supervisors would be better informed if each member of the board were to name a leading businessman to a special advisory commission. But Supervisor Burton Chace, whose Fourth District contained the Marina and who was chairman of the Department of Small Craft Harbors, was strongly opposed to the idea.
The question of leasing policy became a matter of wide public debate during the summer of 1961. In a series of articles, Los Angeles Herald-Express reporter Jack Keating charged that the county was engaged in “give-away deals.”
He criticized the methods that the supervisors used in Marina del Rey and elsewhere for awarding private concessions and renegotiating recreational facility contracts.
In one article, Keating specifically questioned whether favored parties were receiving special treatment in the allocation of Marina del Rey concessions. He noted that only three of the 13 parcels leased at the Marina received more than one bid, while Long Beach and Redondo Beach yacht harbors had obtained multiple bids in virtually every concession category.
Keating charged that “Marina officials admitted they were able to make only a limited effort to publicize bidding, blaming it on legal rulings that neither county general funds nor harbor bond revenues could be spent for such purposes;
“That ground rules set up gave the Board of Supervisors great leeway in rearranging lease parcels and defining their usage, the reporter wrote;
“The Board of Supervisors and Marina officials had wide discretion in evaluating bidders’ qualifications;
“Important changes had been made in the original Marina master plan as well as the first bidders’ manual, containing bidding details, which some would-be bidders had not learned of. These changes made bidding more favorable and might have encouraged wider bidding if generally known; and
“Descriptions of permitted uses of certain Marina parcels advertised have been so broad and vague that prospective bidders could hardly proceed without inside information on what type of facility would finally be accepted.”
Finally, Keating asserted that the claim of favoritism was supported by Chace’s strong opposition to Debs’ proposal to place the leasing activities and management of the Marina under the “watchful eye” of a citizen’s commission.
According to “The Urban Marina: Managing and Developing the Marina,” a series of actions, often determined after consultation with financial advisors and bondholders, gave greater protection to creditors and created more attractive conditions for lessees.
These steps included amending the Marina del Rey Revenue Bond Resolution, narrowly defining the “Active Public Use” clause in the standard lease to facilitate construction of apartments and reorganizing the Design Control Board to more effectively expedite lessee development plans.
Two important effects grew out of the policies devised to meet the financial crisis. First, the priority upon high-revenue producing facilities led to a more intensive development of residential and commercial facilities than had been anticipated originally.
This policy, in turn, transformed the Marina from a small boat harbor into an intensely developed residential-commercial-recreational complex. It also created strong disincentives for low-cost or free public facilities.
A second effect grew out of the first. In the process of ensuring that debt requirements would be met, a tradition of consultation and day-to-day communications developed between Marina administrators and lessees.
This interaction of county officials, lessees and bondholders helped shape the initial policies, procedures, and communication channels for managing the Marina.