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Waterfront Watch: Part 2

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EUREKA- For Part 2 of Waterfront Watch, we take a closer look at the problems developers face while working on their projects on Eureka’s waterfront are.

Some Eureka residents who visit the waterfront often say they have some improvements in mind.

"Definitely more development.  Especially in between this area, between C and F, even just a little bit farther down.  Just seeing a little more development, like some of these dilapidated buildings, if they could fix those up, that would be a huge improvement," said Kristen Serratos, a Eureka resident.

The planned 111 room, four story hotel project behind the boardwalk between C Street and F Street has been in the works for more than 10 years. 

"Nothing is a slam dunk when you're developing property on the waterfront in California…Anything can happen.  Somebody can crawl out of the mud and sue us.  You know how much it costs to sue a developer?  It costs 700 dollars to file a lawsuit that can tie you up forever," said John Ash, one of the developers of the hotel project.

Ash says because the project isn’t already complete, it’s costing the City of Eureka about a half a million potential dollars in tax revenue per year.

"We could have walked away from this a long time ago.  But we'd like to see it happen.  And we'd like to see it happen for the people of Eureka," Ash said.

In response to what was seen as an over development of the coast and a restriction of coastal access, California voters passed the Coastal Act in the 1970’s.  Under this law, developments must have an Environmental Impact Report, or EIR, approved by the California Coastal Commission before construction can begin.

"If you have a project that's on a waterfront location or near a sensitive habitat, then you're going to need more specialized information and sometimes it can be very extensive," said Bob Merrill, the District Manager for the North Coast District Office of the California Coastal Commission.

Peoples’ access to the waterfront and sea level rise accommodations are among the many factors that must be considered to have the environmental impact report approved.

Ash says the battle is not over after getting approval from the California Coastal Commission.  He says the California Department of Finance putting an end to redevelopment funds in the state puts the entire process in jeopardy.

“The State Finance Committee, since they did away with redevelopment, has not approved one development program in any city in the state of California…If the city of Los Angeles or San Francisco can't get the State Finance Department to act, little old Eureka is not going to be able to do much," said Ash.

“The loss of redevelopment in California certainly has slowed the process, but it doesn't mean that the process necessarily stops, it just makes it more difficult,” said David Tyson, the former Eureka City Manager.

Michael Casey is the Executive Vice President of Real Estate for Security National Properties, which has been working on developing the 38-acre Balloon Track into a site with commercial, retail and office space.

"We had Home Depot as an anchor for our tenants when we were processing our entitlements for the development and with the economy nose diving in 2008 or 2009, we lost them as our anchor tenant and frankly have not been able to secure another anchor to basically stimulate development and basically continue forward with the entitlement process…It's going to be pretty tough to secure something like that in the near term," said Casey.

He says it will not be likely to get that anchor tenant soon because of a recurring issue in the area.

"The status of the economy right now, the unemployment rate is pretty high out here," Casey said.

He says the cost of the process is a roadblock as well.

“I mean just all kinds of things that you have to research, wetlands designations, all that stuff has to be analyzed.  We've spent over $800,000 just doing the EIR…Would I recommend today that we go buy a raw piece of ground up in this area for development purposes?  I'd have to say no," said Casey.

And as for the likelihood of current development projects coming to fruition, John Ash and Michael Casey don’t expect that to happen overnight.

"I wish I had an answer.  I don't.  And neither does David Tyson, neither does Mike Knight, the acting City Manager, either does the attorney for the city, nobody," said Ash.

"I've worked on entitlement processes that took ten years, literally, in California…There's just no way to navigate those time frames in a quick fashion," said Casey.

"It is a certainty in my mind that the areas that are appropriate to be developed will be.  I just can't say whether that's going to be in 20 years or 30 years or how long," Merrill said.

Officials with the City of Eureka say as a part of the General Plan Update process, staff will look at all vacant property along the waterfront that the city owns to determine the best uses for them moving forward.