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161ccd73a48f7d274937e3f79228a2a6Regretfully, after nearly a year of negotiations between the city of Monterey and  Sam Balesteri, who has had a master lease for the Wharf Gift Shop, Coffee Shop, and Paluca’s Trattoria for 50 years, it has become clear that an agreement cannot be reached. This was heartbreaking to me.  I know and like Mr. Balesteri’s sons, and the last thing I wanted was this outcome for these wharf businesses.

But my responsibility is to do what is best for the city. The City Council has great respect for the history and heritage of the wharf, and much of that history and heritage is a direct contribution of the tenants. Because of this respect, the city chose to negotiate first with existing tenants rather than market the property competitively.

Second, we offered terms that gradually ramped up rents to move the lease terms toward market rate over a period of years, making it easier for the businesses to make adjustments.  The city also made other concessions to try to find a way to extend the Baluster lease. But the council has a responsibility to manage our resources wisely, to treat everyone fairly, and to ensure taxpayers are not subsidizing businesses.

People need to know that the decision to evict these businesses was not a careless one; it came after 11 months of fair negotiations and after several hours of discussion by council and staff. On several occasions the city made concessions during negotiations and on several occasions we thought Mr. Balesteri was ready to sign a lease renewal. Each time he came back seeking more concessions from the public. In the end it became apparent that he wanted a deal similar to the 50-year ground lease that expired two years ago.

I am not permitted to tell you what he has been paying the city for monthly rent—only he can—because it would let competitors know his revenue, which is considered “proprietary” information. Before people decide if the city is being unfair they should ask to see what monthly rent is being paid and then look into what other businesses pay. What I can say is that the proposed terms were still below market rent as compared to what other businesses in town pay. Moreover, the city offered terms of more than ten years so the rumors you may be hearing to the contrary are simply not true.

If you think the city was asking for something unreasonable, then why would Mr. Balesteri’s sub-tenant, who owns and runs the restaurant, Paluca Trattoria, sign a lease directly with the city on terms comparable to what was offered Mr. Balesteri?  He has been able to run a successful business for years paying Mr. Balesteri market rent; why is it a hardship for Mr. Balesteri, who has enjoyed favorable terms for 50 years, to pay rent comparable to other businesses?

The city took so much time and was willing to compromise so much because we truly wanted to keep Mr. Balesteri there on the wharf. We appreciate who he is and what he has done. The city’s approach is to negotiate first with current tenants and seek market rate terms as their leases expire.  If that fails, then we will market the properties and again give first priority to local and independently owned businesses. False claims from wharf business owners that the city has plans to replace local businesses with national chains like Hooters, McDonalds, and Red Lobster are false and misleading.  I personally inserted a motion into our leasing policy that expressly allows the council to give preference in leasing to local business and that is what we have been doing.

My core principles tell me that the public should not be subsidizing private business, however nice the owner of the private business may be. Due to the limitations of the leases negotiated decades ago, the city has used some General Fund money to pay for maintenance and improvements in our Tidelands area, which should be funded by Tideland’s commercial leases. Additional revenue from the commercial leases will enable the city to make the wharves more attractive, clean, safe and enjoyable.

EDITOR’S NOTE: Libby Downey contributed to this article. She and Haffa are members of the Monterey City Council and have been leaders of the effort to reform the city’s leasing practices.  Some of the Monterey wharf tenants, led by restaurant owner Chris Shake, have been conducting a vigorous disinformation campaign via petitions and social media in an attempt maintain deeply discounted rental rates by putting political pressure on the City Council. The group contends, with zero evidence, that the city wants to drive out local operators in favor of chains and, contrary to reality, that the city won’t allow new leases beyond 10 years.

Comments on this entry are closed.

  • Merry Nolte September 5, 2016, 9:32 am

    Why isn’t this in the Herald?
    Alan, did you try to submit it to them?

  • Jason Reed September 5, 2016, 9:56 am

    Very done.

    • Beverly G Bean September 5, 2016, 10:24 am

      I would suggest that Alan submit this to Sara Rubin, editor at Monterey County Weekly. I would edit it down to 600 words for a guest editorial and add what Royal said about the disinformation campaign.

  • Jean September 5, 2016, 11:59 am

    Good for the City.
    Best of everything to Paluca Trattoria.
    Without giving dollar amounts, the City could specify percentages due based on gross sales, triple net or whatever formula the City uses.
    Yes. After wearing a Rolex or a Vacheron, most everything else may look lousy. That’s life. Get used to it.

  • gin September 5, 2016, 12:18 pm

    Trader Joe’s and at least a half dozen other businesses were built on the site of the former Safeway. If I remember correctly, Safeway had a sweet 50-year lease from the city also. Again, if I remember correctly, the large supermarket’s monthly rent was less than a lot of locals pay for an apartment.

    Does anyone remember the dollar amount of Safeway’s lease?

    If so, please post. Thanks!

  • Jean September 5, 2016, 12:51 pm

    The “sweet” deal with a large grocery store like Safeway might have reflected the City’s concern with having a grocery store available in the community long before Sand City’s big boxes were built. Convenience to residents might have been an issue. There must be someone out there with background on this.

    • Bob Oliver September 5, 2016, 1:59 pm

      ME!

      • gin September 5, 2016, 2:26 pm

        So???

        • Bob Oliver September 5, 2016, 7:06 pm

          YOU ASKED FOR IT!

          If memory serves me correctly, it was $800 per month Safeway was paying. As the lease ran out, rent was to go up considerably. Then, in stepped Trader Joe’s and the developers. Everyone except Safeway profited from the experience ($$$$$$$$$$). Safeway said “Screw You,” and Montery residents started riding bicycles to Seaside/Del Rey Oaks, since the cost of living kept going up, and they couldn’t afford gas for their cars, because they were spending all their money on CalAM water. The year was 2020, or was it – 2525. https://www.youtube.com/watch?v=yesyhQkYrQM. P.S.–Yes, I know everyone likes Trader Joe’s. I shop there myself.

          The answer to your question is Safeway paid $800. Trader Joe’s representatives wined and dined a few City officials on their yacht. That’s the story I got while running for Mayor. The project turned out to be overly successful. It helps to balance out the decision to get rid of the OLD SKATING ARENA, which was worth more to the community than the empty lot that stands there now, 15 years later. GRRRRRRRRRRRR RRRRRR RRRrrrr!$$$$$$$$$$$$$$

          So Greed it is!!!

  • Bob Oliver September 5, 2016, 1:57 pm

    OH MY GOD! THEY ARE GOING TO BLOW UP THE WHARF!

    We do jump around from issues such as Cal Am Water, horse tracks and gambling at the Embassy Suites, to prison labor shoring up Carmel’s mission fields to prevent flooding.

    And what about Cedar Funding and the thousands of local investers being robbed of their life savings, or what happened to the Pebble Beach Art theft story of 2011? All is not lost. All is not forgotten.

    The City of Monterey does most of its lease negotiations behind closed doors. I don’t like that. WE never get the whole story.

    Wharf business owners are about to march on City Hall this week. Some are threatening to demolish the buildings they “own.” The political animal that is the City of Monterey has mobilized Italians, Irish, Indian and other ethnic groups, which have not always gotten along well on the wharf.

    In the late forties my family and I would go there looking for a great fish meal supplied by local fishermen. It was predominently Italian run and owned. We walked onto the wharf like horses with blinders on, looking staight ahead and not confronting our “Dago” friends cursing us out for not eating at their restraurant. “Walk faster,” my dad would tell us. We didn’t feel safe until we reached our destination for a meal at the end of the wharf. Coming back was another matter. Thank God for blinders!

    When Shake family members entered the scene, they did more for the wharf than you can imagine. More and more peole came there to eat, which created an overflow business for everyone. Times were good. Today, however, the cost to do any business is prohibitive. What the City proposes is not an answer to the needs of those whose businesses on the wharf have served us admirably all these years. DON’T BREAK THE TRUST!

    Bob Oliver 831 383-2676 think for yourself boboliver9@gmail.com https://www.youtube.com/watch?v=4utTbJ6b-Tg

  • Jessica Everingham September 5, 2016, 3:01 pm

    $200/month,Safeway paid as rent, since the 50’s,was what I heard when I bought my home on Monroe, 25 years ago.I cannot confirm how I heard that, but it was heard again when negotiations began. I’d love to be corrected.

    • gin September 5, 2016, 4:21 pm

      $200/month for 50 years with NO rent increases?

      Have the rents on the wharf also not increased in 50 years?

    • Bob Oliver September 6, 2016, 1:31 pm

      The rent started out low, $200, and went up to $800, as I recall. In todays market – its all about greed.
      Safeway was willing to negotiate, but Trader Joe’s in the wings was driving the baraining price up like a wedge. I suspect that the developers were there to make money too, and Safeway would have used their own developement to remake the store down the timeline. More money was spent up front and we lost Safeway in the end.

      Bob Oliver

  • Jean September 5, 2016, 4:27 pm

    Lessees do not “own”the improvements (structures) they are permitted to build on their leased property. They enjoy a possessory interest in them during the term of the lease. At lease termination, the buildings revert completely to the lessor (City).

  • James Toy September 5, 2016, 5:52 pm

    A big part of the confusion in the public mind (i.e. mine!) is who actually owns what. Starting at the seafloor below the wharf, I’m pretty sure the city owns that. But above that it gets very confusing.

    I think I read somewhere that the businesses own, or are at least responsible for, the pilings under their shops, but the city owns the pilings under the public areas. So who is responsible for holding up the wharf as a whole? Is the structural integrity of the wharf managed by one entity or dependent on each individual business doing its part?

    Then there’s ownership of the buildings. Does the city own them and lease floor space like a normal landlord, or do the businesses own them and just lease the wharf deck they’re built on? One owner has threatened to demolish the building he claims to own. Does he really own it or not?

    I’ve read the news stories on wharf leases and I was never able to decipher the overlapping layers of who owns what and who is responsible for what. One thing seems certain: The relationship between the city and wharf businesses is far more complex than typical landlord-tenant relationships on earth-bound real estate. So I suspect the vast majority of local citizens are just as confused as I am, and this makes it difficult for either side to make its case to the public because the public can’t grasp the intricacies. From where I sit I can’t tell if the city is screwing the tenants or if the tenants are just whining. If citizens are taking sides, it’s most likely based on who they know rather than what they know.

    • Bob Oliver September 5, 2016, 7:13 pm

      Amen.

    • Alan Haffa September 6, 2016, 12:59 pm

      The city owns the Tidelands where the Wharf is. The businesses who are still on the original ground lease, currently own the buildings above. The contracts all have a reversion clause, customary in ground leases, that ownership reverts to ground owner at end of contract. This is no slight of hand. No trick. And everyone with a lease there knew the terms when they signed. They got very favorable terms for 50 years to pay back the initial investment, but ownership is primarily with land owner.

      The businesses have been responsible to maintain the pilings beneath the business, but the city maintains all the rest–about 60%. The city has done a good job. Some businesses have done a good job of maintenance and others not so good. Once city assumes ownership of building it assumes ownership and responsibility for additional pilings. Increased revenue, however, will more than pay for these additional costs.

      Most multi-tenant business areas include a fee called common area maintenance. It is standard and normally businesses pay 100%. The city has proposed a 60/40 cost share for common areas–currently city pays 100%.

      The city is responsible for the wharf as a whole. And the revenue we make from our tidelands leases is supposed to pay for public expenses throughout the tidelands. Current revenue does not fully fund all maintenance and improvements needed in Tidelands/Waterfront area. More Tidelands revenue is not going in the pocket of anyone; it will go to improve the wharves and other aspects of Windows on the Bay for the public, the businesses, and residents.

      It is complicated and this is why the city has a city council–because we can spend the time to learn all the intricacies of commercial leasing in this case, and other issues. Ask yourself who has a self-interest here? I have no personal interest in the leases.

  • Karl Pallastrini September 5, 2016, 6:43 pm

    Well said James Toy. Few of us get the actuals of what is fair and right on the Wharf leases. I wouldn’t be too quick to dismiss the position of the city of Monterey. I would think they have vetted their situation with other cities in similar (if possible) situations in other port cities. Where I have a problem is with the sub-leases. Why should a tenant who has enjoyed a sweetheart deal for many years be able to sublet wharf property for profit? It is probable that some of the sublet’s pay for the cost of the primary lease. A lot of respect for those who have developed the wharf and given it the character of old Monterey. Having said that, we are in the 21st. Century, and everything is subject to review. Would like to know more about what is “fair” to both parties.

    • Dan Turner September 5, 2016, 10:46 pm

      As I understand it, the folks with the master leases (for which they pay next to nothing) charge their sub-leasers the going rate for commercial space of that sort. This means that a very small fraction of the sub-leaser’s rent pays the entire rent (to the city) for the master leaser, leaving a profit for the master leaser in the hundreds (maybe thousands) of percent. Nicer work if you can get it. No wonder they are fighting like hell to retain such a sweet deal. Beats working for a living.

  • Esther Malkin September 5, 2016, 7:04 pm

    Interesting that the Mayor & other 2 council members (none currently up for reelection) are not saying much to media about this when they all voted on it.
    Btw, I forward to Weekly & Herald not that they’ll do anything more than what they already covered.

  • Patty Cramer September 6, 2016, 12:44 am

    The Wharf is part of the history and tradition of Monterey. I do feel it is fair to charge more than $800.00 a month, if that is the rate. There should be no subletting allowed. I live in a mobile home park and we can’t do that. I would be interested to see a list of incomes from Wharf businesses, it would then be fairly easy to figure it out. Not sure how one could demolish their “leased” property, but stranger things have happened. Keeping the Wharf in the old style tradition is a good thing.

    • Dan Turner September 6, 2016, 9:12 am

      The “old style tradition” is fine. Giving these greedy jokers a free ride isn’t.

  • bill leone September 6, 2016, 9:52 am

    Thanks for the inside information Alan.
    This is an example of Good Old Boys ripping off the Public for the purpose of lining their pockets
    with obscene amounts of profits: Greed in this case is Not good, because it diverts revenue from
    Public Coffers; in the end the Public suffers (in this case for 50 years), while Fat Cats & their Families live in opulence & splendor, & nearly everyone else hunkers down in mobile home parks. This has been the strategy of the Rich & Famous since before the time of Robber Barons.

    I hope loyal readers of the Partisan realize Councilman Haffa is running for re-election this November & needs all the support he can get, since the last time he ran for office he was outspent seven to one. Guess who is funding the opposing candidates? I encourage Partisan Readers to reward Alan for looking after our interests rather than turning our backs on him at this crucial time.

  • L. Parrish September 6, 2016, 11:35 am

    How about some of the Good Ol’ Boys reopen their businesses on N. Fremont and revitalize that area? Let’s see if they can make it there, or will they again seek subsidies (corporate welfare by any other name) from the city (YOUR pocketbooks by any other name). I thought panhandling was frowned upon in Monterey.

    • Dan Turner September 6, 2016, 12:54 pm

      Larry, you just don’t get it! Its not panhandling when the rich do it. Its “tradition”, old style.

  • Bob Oliver September 6, 2016, 1:50 pm

    So you don’t think they will demolish their own buildings do you? THEN YOU DON’T REMEMBER ALL THE VERY MYSTERIOUS FIRES ON CANNERY ROW. “Oh, you do.”

    Some of you, (Larry, Mr. Toy….) who want to cozy up to the City and make “political friends” and play nice, forget how heavy handed the City has played in the past. Its entire past. Maybe the City is trying to play FAIR this time and maybe nnnNOT>.!

    As for the definitive of whether or not they can take their own buildings,burn their own buildings, or blow their own buildings – I don’t think Alan has really, REALLY, answered that question completely truthfully. I know I couldn’t answer it – tuthfully, or even answer it. But I could initiate some concern that goes beyond THE PARTISAN, and veyond City Hall and the Wharf. Shouldn’t we do that – for Martin Luther King, Bobby, John, and all the rest. https://www.youtube.com/watch?v=rDOmf5ER0-M
    https://www.youtube.com/watch?v=Ld6fAO4idaI

    • James Toy September 7, 2016, 1:12 am

      “Some of you, (Larry, Mr. Toy….) who want to cozy up to the City and make “political friends” and play nice, …”

      Huh? Did you actually read my post???

      I have no need for political friends.

  • Matthew Sundt September 6, 2016, 9:03 pm

    “…because it would let competitors know his revenue, which is considered “proprietary” information.” This is part of the problem. Citizens of Monterey are the landlords. They should have the information at their disposal. This ripping off the tax payer would not have occurred had their been transparency. All future contracts should be transparent. If you do not like it then open your business elsewhere. I lived in Monterey for a total of 20 years and had I known what was going down (how could I if the books are closed!) all these years I would have raised a stink! Thank you Bill McCrone for bringing this issue to a head!!

    • Bob Oliver September 7, 2016, 9:05 am

      Transparency! What a concept! But then what will happen to back room deals?

  • Ben Balester September 6, 2016, 9:34 pm

    I appreciate Alan’s words and all that has been done by the Council (and City) in support of homeless, improving streets, community, etc. and some necessary enhancements to certain business. There are however some imperative details that have been excluded pertaining to the wharf. The City manager said that the wharf merchants had been paying fair market rents. The City wrote a lease that stipulates that the certain business owners can get compensation for the buildings or demolish them. Demolishing them may actually provide a result that is better than when they were first purchased. Remember that these new structures were erected and maintained throughout the years by the current owners. Hundreds of thousands of $. The City didn’t want to know about it way back then. Owning and operating a business also comes with heavy overheads. For those of you that have actually experienced this will know. These maintenance costs are particularly high when you are working over water, for those of you that have experienced this will know. The City now wants to add CAM (common area maintenance) costs that the business owners will pay the majority % of. The City claims that the Main Street down the wharf is not a city street but belongs to the businesses.
    What do you feel you would be entitled to if you created something out of nothing and someone wanted to take it? Many locals feel that the City owns enough. There is no need to devalue what people have spent there dollars, blood & sweat on. I decided not to comment on lease terms right now but will say that with some of these business owners incomes they may not work and some don’t offer favorable incentives with regards to getting a return on investment. Look at what Santa Cruz wharf does to keep local business afloat. If history and local business wants to be preserved then sinking the wharf is not the answer. Some wharf business owners have been backed up against a wall and have no choice but to protect their investments to support their families. It is a seasonal spot and everyone down there has been working their butts off this Summer. You will still find the owners down there seven days a week once the Summer ends.
    The City really hasn’t been that active or present on the wharf in the past. Anyone been in the public bathrooms there recently? Ok, I know I need to look forward. Now there is a plan finally to remodel them. I will only comment briefly here. There are other more constructive things for the community I’d rather, like you, spend my time on.

  • bill leone September 11, 2016, 10:01 am

    In fact, some of us have owned & operated businesses, a few of them restaurants…perhaps Not
    on a wharf. And most of us know that rent in Monterey is one of the most significant overhead expenses. In addition, there are usually CAM (common area maintenance) costs, insurance, state
    & federal property taxes, & a percentage of the gross profits (that’s called “triple net,” in case
    you’re unfamiliar with the term), workers compensation insurance, utilities & a host of other expenses; that’s called Managing a Business….it’s difficult, & hopefully profitable.

    There are a Lot of details Not addressed in the previous comment, such as:
    1. What does the City charge business owners on the wharf?
    2. Who built the wharf & who owns it?
    3. What city manager said the wharf merchants were paying fair market rents, & when
    did he or she say this?
    4. Where exactly is this lease between the City & wharf merchants & what does it stipulate exactly?
    5. Who has been maintaining what on the wharf, & how much has been spent on this maintenance?
    6. What is the problem with wharf merchants paying a CAM fee, since most restaurants in Monterey
    pay some sort of CAM?
    7. Do the merchants pay for their share of Fire Safety, Police Security & Traffic Maintenance & other City services?
    8. Where does it say, in what document, that wharf merchants actually own a public street?
    9. What do the merchants on the Santa Cruz wharf pay for rent, & what does Their lease look like?
    10. What are the merchants on the wharf making in terms of gross & net profits, especially those
    “owners” who are subleasing to other merchants? Are subleasing “merchants” charging Their “tenants” triple net?
    11. What sort of tax revenue are the wharf businesses generating for the City & the County?
    12. Why are most of the above issues cloaked in secrecy….what are the hard-working, struggling
    wharf merchants &/or City officials afraid to reveal to the Public?

  • Willard McCrone September 12, 2016, 12:56 pm

    It is encouraging to see the number of interested parties responding to Alan and Libby’s accurate piece about the City Council’s action to finally re-exert control over the Wharf for the benefit of the public after 60+ years of heavy subsidy for the good ole boys on the Wharf. The responses above show the persistence of a great deal of misinformation foisted on the public by the Wharf Lords who are now seeing the end of the free lunch they have enjoyed at the public’s expense for 60 years. Keep in mind that many of the existing terrible ground leases on the Wharf will continue for another 25 years (until 2041) due to the incompetence of city staff and Council in 1991 to extend the leases for 50 years without any rent increase since 1977.

    I will not repeat the long essays that I have posted in the past two years, which set forth the facts, rents, and accurate history of the Wharf, but refer you to Royal’s archives where a search under my name will reveal the articles. Several items discussed above require further edification here:
    (1) SAFEWAY LEASE. My recollection is that Safeway was paying about $12,000 per year in ground lease rent when its ground lease expired. The City had leased bare ground to Safeway in the sixties and Safeway developed the land, building and lot at its sole expense. That is the way a ground lease is supposed to work – the developer/tenant pays all cost of improvement and operation, in return for which the tenant pays the landowner a reduced rent to reflect that all the capital comes from the tenant. Into the bargain is the reversion of the property, with all improvements, to the landowner at the end of the lease term, when each party gets the full benefit of her bargain. The Safeway deal was a “Righteous Ground Lease”, good for the public and good for Safeway.

    The City initiated negotiations to continue a “building lease” with Safeway at fair market rent (including gross percent) for another 25 years. Negotiations were successful except for one point. Safeway insisted that it have the unfettered right to assign the lease to anyone it chose in the event Safeway elected to leave the premises. This, of course, was unacceptable to the City which had every right to vet any proposed assignee tenant, and in particular a need to insure that whoever occupied the premises be a retail food store. Safeway was unwilling to budge from its most unreasonable condition, and the negotiations ended.

    Trader Joe’s (Foothill Partners) then stepped up to negotiate a 66 year ground lease reflecting a much higher rent, but still recognizing that the capital of Foothill would be razing the Safeway building and constructing a new retail center which would include retail food. Both the original Safeway lease and the Foothill lease were well within reasonable commercial parameters for landowners. Those leases literally have nothing to do with the Wharf leases, and nothing in common. They are apples and oranges to each other, and as fruit and widgets to compare with the Aquarium tidelands lease.

    (2) ACTUAL RENTS. This discussion would be much more illuminating if the City would release the actual rent figures (Master and Sub-lease) for the Wharf. The City Attorney has an opinion that such figures are confidential, but that is just her opinion. When a merchant leases public tidelands trust property from the public, it has no right or expectation that its sales figures will be kept confidential to hide the facts from the public. Yet that would apparently be the purpose of this city policy. It is unfortunate that it will take a lawsuit to obtain the transparency that is required for the public to evaluate the horrendous job the City’s property management has done since 1977 on these sweetheart leases on the Wharf. No doubt the thinking is that a lot of problems would be unnecessarily created by telling the public the truth.

    There are ways to get rent figures without the City’s cooperation. Based upon a City commissioned appraisal in 2008, and disclosure of the tax and rent rolls by the County Assessor’s office in 2012, we can closely estimate that the Balesteri lease (for 3 discrete retail spaces), which has just been terminated, earned between $905,386 and $1,000,000 in annual gross sales last year. Balesteri paid the City 3.0% of gross sales per year – $22,635 in 2008; and $18,511.49 in 2010. Fair market value for those premises is 8 – 10% of gross sales. Thus Mr Balesteri received a subsidy from the pubic (mostly in the form of sub-lease rent retained) at the high end of $77,000 per year. It is understandable that he wanted to continue that windfall, for which he never paid anything whatsoever.

    Balesteri is a small operator compared to the Shakes and Mary Alice Cerrito. According to a written sublease available at the City, Chris Shake received sublease rent from Fisherman’s Grotto in the amount of $27,563 PER MONTH in 2010, over and above the rent paid to the City. Cerrito proposed to sublease the old “Gilbert’s” for in excess of $20,000 per month sublease rent in 2015. I do not have figures from her current sublease to the Shakes, but it is fair to estimate that they pay her in excess of $20,000 per month from their new restaurant. Most tenants on the Wharf pay Fair Market Rent, but they pay it to sub-landlords, not the public. That is an outrageous ripoff. The new City Council policy will require a provision in new building leases that all sublease rent be paid to the City and the public.

    (3) OWNERSHIP/REMOVAL OF BUILDINGS. The ownership of the buildings on the Wharf is misunderstood concept number 1, and it seems to be intractable. The public owns the tidelands by Constitutional grant in perpetuity. Under the law, the landowner owns the land and everything on it, including buildings, nails, and roof tile. The Wharf lords repeatedly claim they own the buildings, a claim utterly devoid of the truth. If you own a real estate interest, you have a deed to prove your interest and you pay real property tax to the County. If you own personal property, you have a bill of sale and a title document to prove your interest, and you pay personal property tax to the County. The Wharf merchants have neither. It would seem that the old propaganda axiom pertains – if you tell a lie often enough, the people will believe the lie over the truth.

    It would appear that the claim that the merchants can remove the buildings when they leave is another intractable lie that won’t go away. The ridiculous lease provision saying that the tenant can remove the buildings they built within 90 days of termination of the lease is, and for over a decade has been, void. A California Court of Appeals decision (County of Santa Barbara vs. Channel Islands Marina) has established conclusively that such provisions in a tidelands lease are void because Coastal Commission approval of a demolition could never be obtained within 90 days, as a matter of law. Moreover, the Coastal Commission would never approve a demolition without receiving a conjoined permit request to replace the building with a new structure. Finally, no merchant is going to spend the million dollars required to demolish, which would be an utter waste of money.

    As Alan says, the buildings revert to the public upon expiration of the lease, which is the modest benefit of a poor bargain struck by the Council many years ago. Nothing whatsoever is due the tenant, who has received the generous benefit of its one-sided bargain in the form of many years subsidy in rent.

    The hard won gains for the public that were voted for by Alan and Libby are at risk in the this election. The Wharf Lords will spend heavily to get another tool like Ed Smith elected to change the balance on the Council and roll back the public gains so that the rip off on the Wharf can continue indefinitely. Vote to return Alan and Libby to their seats on the Council and preserve our waterfront to be operated for the benefit of the public, not the private business profiteers on the Wharf.