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Orange County

Irvine, O.C. Near Accord on El Toro

A revenue-sharing agreement would allow the city's annexation effort to proceed.

March 01, 2003|Jean O. Pasco | Times Staff Writer

Orange County and Irvine officials appear close to an agreement that would break the final logjam threatening development of the closed El Toro Marine base.

The two have been at odds over how to divide the property tax revenue expected from homes and commercial buildings planned for a portion of the base that Irvine is trying to annex.

In a proposal released Friday, the county would keep 82% of the taxes generated from base development. The county, however, could use the money only to improve its portion of the base property, on which it plans offices and an equipment yard.

County officials feared they would lose tax revenue if Irvine annexed the base land and then formed a redevelopment agency to help provide services to the new neighborhoods. Under state law, cities that form these agencies are allowed to capture all new property tax revenue from that district, as long as it is spent to improve the area.

Supervisor Chris Norby, a longtime critic of redevelopment agencies who questioned the deal with Irvine, said Friday he is satisfied that the county would benefit from the agreement. Using the tax money to pay for county facilities at El Toro would free up other, unrestricted county funds for use elsewhere, he said.

The ramifications are significant.

The Navy, which owns the property, won't allow its sale to private developers until after the land is annexed by Irvine. In a letter sent to county officials last year, the Navy urged county officials to approve the annexation so the property could be sold without delay. The 4,700-acre base closed in July 1999.

Disagreement over the taxes surfaced in April and threatened to hold up the city's plan to take over the property, which Irvine has slated for parkland, sports fields, a university, and homes and commercial buildings.

Tempers flared again this week as several officials for cities in south Orange County urged the Board of Supervisors to approve Irvine's tax-sharing proposal. During debate at the supervisors' meeting, Lake Forest Councilman Peter Herzog accused a supervisor of sneering at him, and Supervisor Chuck Smith criticized Irvine's proposal as a money grab.

The concerns about property tax revenue are not new.

Last year, then-board Chairwoman Cynthia P. Coad cast the deciding vote to approve a tax agreement with Irvine, saying she hoped the county would get $800,000 a year in revenue to use for parks in north Orange County.

But she rescinded her vote two months later after accusing Irvine of reneging on its promise to guarantee the county's share of the money.

Coad said Friday that the county should hire a professional negotiator to make sure Irvine delivers what it promises.

"A simple Irvine statement has much more unsaid than said," she said.

Irvine consultant Stu Mollrich said the give-and-take over El Toro is an "extremely complicated real estate transaction" that has been frustrating for both sides. But that doesn't mean the buyer and seller don't want to close the deal.

The only remaining issue is how much traffic Irvine will allow the county to generate on its property without paying for road improvements.

Supervisors are scheduled to vote on the agreement Tuesday. Norby said he hopes a final wrinkle over traffic levels can be resolved before then.

"Irvine has to have a full appreciation of our needs, and they will by Tuesday," he said. "One side can push, but there has to be mutual consent."

Irvine's takeover of the land must still be approved by the state's Local Agency Formation Commission.

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