Marina, FORA quarrel over future of Preston Park, past Army agreements.
Thursday, September 29, 2011
Paula Pelot considers herself an unofficial historian of Preston Park. Given that she’s lived in one of its 352 residential units on the former Fort Ord since the affordable housing community’s inception in 1997, she’s got some authority. And she’s using it to question the Fort Ord Reuse Authority’s plans to sell Preston Park to the city of Marina before FORA goes out of existence in 2014 – that is, if FORA doesn’t get legislative approval to stay alive until 2020.
Pelot cites a 2000 agreement between the U.S. Army and FORA, laying out parameters for the transfer of former Fort Ord land including Preston Park. Pelot, along with city officials, claims the memorandum of understanding specifically states the property is to be given to Marina at no cost. “There is sound legal basis for the city to pay nothing to FORA,” Pelot says.
Marina Mayor Bruce Delgado and city attorneys agree. But FORA’s attorneys see it differently.
“That difference of opinion is the subject of mediation,” says FORA Executive Officer Michael Houlemard.
On July 7, FORA board members considered terminating FORA’s existing agreement with the city, which serves as Preston Park’s agent and has split the property’s rental revenues with FORA since 1997.
The city and FORA first entered into mediation Aug. 2. Their next meeting, facilitated by retired county Superior Court Judge Richard Silver, is Oct. 6.
FORA’s 1994 charter mandates that land sales generate the revenue needed to fund infrastructure projects. Selling Preston Park, appraised last year at $57.3 million, would help the agency do just that, according to FORA board member Bill Kampe.
The FORA board officially unveiled a plan Sept. 16 for extending its lifespan and finishing more projects. (Houlemard says FORA has completed less than 20 percent of its work so far.) But there’s no guarantee the state Legislature will green-light that plan. If it doesn’t, FORA will need to unload Preston Park before its June 30, 2014 sunset date.
The Preston Park sale isn’t the only bone of contention between FORA and the city. There’s also some disagreement about FORA’s $19 million loan from Rabobank in 2010, intended to provide matching funds for a federal stimulus grant and pay for the refinancing of prior loans. Preston Park was used as collateral for the loan.
That might make it tricky for FORA to simply hand over the property to the city. “Now, there’s a debt on that property that didn’t used to be there,” Delgado says. “This is not in our best interests.”
Delgado also claims FORA excluded the city from some conversations with Rabobank about the loan.
That’s a point Houlemard disputes. “The city was involved in every step of the process,” he says.
Some officials think it would be a good idea for the city to sell Preston Park to a private entity once the transfer from FORA is complete.
“A sale could generate tens of millions of dollars of general-purpose revenue,” says Marina Development Services Director Doug Yount.
City Councilman Jim Ford advocated for a city sale of Preston Park at the council’s Sept. 7 meeting. The city projects a $5 million shortfall next fiscal year.
But Pelot strongly opposes a sale. “Preston Park has been a bedrock of sustainable revenue for Marina,” she says. “If they sell it now, the proceeds might run out within 10 years.”
Delgado hopes mediation will keep the city and FORA out of court over Preston Park: “We’re hoping for a better partnership with the next steps.”