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In Hearst Land Fight, Old Papers Are New Weapon

Law: Obscure deeds give firm an edge in deciding scenic coastline's fate.


SAN SIMEON, Calif. — Rolling across a golden pastureland in a shiny new Suburban, Stephen T. Hearst talks about preserving the memory of an enchanted youth: riding horseback with his father, camping deep in the canyons behind Hearst Castle, hunting for deer, wild pigs and quail.

"We want to make sure our kids can enjoy this place as much as we did," said the great-grandson of William Randolph Hearst.

But lawyers for Hearst Corp. appear to be heading toward something very different from the goal of preservation that Hearst's words suggest.

The lawyers have amassed a trove of obscure 19th century land records that could allow the corporation to chop the 83,000-acre ranch into 279 parcels and create oceanfront subdivisions.

A relatively new wrinkle in California land use law, the records known as certificates of compliance show evidence of long-forgotten property splits. Under state law, the certificates can give modern landowners carte blanche to circumvent local zoning rules and other restrictions on development.

The certificates have provided real estate speculators with powerful leverage over coastal open space. Conservationists consider their use a form of blackmail, forcing them and taxpayers to pay hugely inflated prices to protect the land from development.

Yet Stephen Hearst swears that's not his intent.

"We have no specific development plan," he said recently.

Instead, he said, the corporation simply wants to gauge the land's "potential" for development to help determine its maximum value. The key here is that property that can be turned into building lots is worth much more than grazing land.

Once he knows the value of the development rights, Hearst said, he hopes to sell them to taxpayers or private foundations, which would retire the rights and preserve the land much as it is.

As Hearst envisions the arrangement, the corporation would retain ownership of the ranch but give up rights to build on 99.5% of it. Such a plan could still leave enough room for a version of the resort hotel complex that the Hearsts have proposed in the past.

Many ranch owners have used certificates of compliance very successfully, Hearst said. "Every one of these deals was absolutely tailored to the landowners' needs."


In recent years, developers brandishing the certificates have unlocked thousands of acres along the coast that were thought to be exempt from subdivision. Conservation groups desperate to protect some of that land have paid huge premiums.

Tactic Gains Popularity

In 1998, two conservation groups forked over $43 million--twice the price negotiated a few years earlier--for a 7,000-acre dairy farm north of Santa Cruz. The motivating factor: Brian Sweeney, a Las Vegas land speculator armed with certificates of compliance who was threatening to carve up the farm into 139 parcels.

In another deal involving certificates and Sweeney, the Trust for Public Land recently paid about $26 million for a smaller ranch on the Big Sur coast. This time Sweeney made a $24-million profit on the sale after moving to subdivide the ranch into nine large home sites.

The run-up in prices in these cases and others was based on the discovery of old deeds and other records that indicate, sometimes in the vaguest ways, that the land was not always one parcel but a collection of many historical lots.

These underlying parcels might have been crude homesteads or mere well sites. Yet, even if nothing was built on it, evidence that the property existed has often been enough to allow modern owners to subdivide again.

Moreover, the modern owners have been able to adjust the boundaries of the old parcels so they can be moved around like pieces of a puzzle.

A 1992 California appellate court ruling gave landowners broad ability to move lot lines so long as the alterations make the lots more suitable for building and do not create any more parcels than already existed. The new location of a lot need not encompass or even touch the original one.

Conceivably, that means a landowner can take an isolated, largely worthless lot on a mountainside and move it to the beach, where it will be worth a fortune.

Conservationists Forced to Pay More

Such strategies have emerged over the last three decades to thwart ever-tightening zoning rules in California communities that have become resistant to growth. Developers in Napa, Sonoma and Mendocino counties have used certificates of compliance to create nearly as many new building sites as they have through the normal planning process.

More recently, the strategy has become a way for landowners to force conservationists to pay ever higher prices for land they want to protect as open space.

"This is a new kind of environmental terrorism," said Rep. Sam Farr (D-Carmel). Landowners and speculators, he said, have managed to hold the land hostage. "Pay the asking price or it will be developed."

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