By: LARRY PARSONS Herald Staff Writer
A Sand City beachfront hotel-resort, touted as the model of environmental sensitivity by a developer who has spent 17 years pursuing the project, once again is entangled in the courts with the state Coastal Commission.
The proposed Monterey Bay Shores Resort — a 341-unit “eco-resort” on 39 acres once used for sand-mining — received a key favorable action this month from the Monterey Peninsula Water Management District. On a 7-0 vote Aug. 16, the water board approved a long-sought water distribution permit for the Sand City resort first proposed by developer Ed Ghandour in 1993.
With little wiggle room, the water district board had to make a decision that was largely dictated by previous court rulings. “We think this is great news. This was the Coastal Commission’s primary objection to the project,” said Sand City Administrator Steve Matarazzo. Sand City has long supported the resort proposal.
But the project still will need a thumbs-up from the state Coastal Commission, and that has proven elusive, to say the least. The project twice has been rejected by the coastal panel — most recently in December. “The Coastal Commission basically has the last word,” said Henrietta Stern, project manager for the water district.
Ghandour’s Security National Guaranty and the coastal panel are engaged in another round of litigation that likely won’t be resolved until the middle of next year, she said. Ghandour filed suit in San Francisco Superior Court in February, contending that the commission’s 2009 decision would prevent the Sand City property from ever being developed. The suit alleges the commission has denied Ghandour the economical use of his property, and the state must compensate him for the “taking” — to the tune of $200 million.
Attorneys for the Coastal Commission have filed a response, denying the key allegations in the complaint.
Commission staff members in December called the “takings” argument unfounded because denial of the “massive” project would still allow “a smaller project… consistent with (Sand City’s coastal plan).”
Alternately, Ghandour is asking the court to overturn the commission’s latest denial by ordering a new hearing or the issuance of the projectcoastal permit. That issue likely will be settled before the end of the year, said Ghandour’s attorney Thomas Roth.
Water for the Sand City resort has been a major issue — as it is with virtually every development in the Peninsula area — and Ghandour also lockedhorns with the water district in court.
In July, the water district board split 4-3 against approving the permit for California American Water to supply the Sand City resort. But last week, the water district board was under a tight court order to make a decision without requiring any new environmental review.
The proposed resort site was allocated up to 149 acre-feet a year from the Seaside Basin in a 2006 court ruling, which bars further review of its water supply under the California Environmental Quality Act, Stern said. Along with the Carmel River aquifer, wells in the Seaside Basin are main sources of Cal Am water for Peninsula customers.
Opponents contended that more environmental analysis was needed to determine if the proposed resort’s water use would impact the badly depleted Carmel River system.
But courts previously ruled that the water district’s only role was to ensure that no net Carmel River water — despite it being stored together, at times, with Seaside Basin water — would go to the resort. “What the water board was really left to do was water accounting,” Stern said.
The water district permit will require California American Water to provide the district with weekly figures on its pumping from Seaside Basin wells and water delivered to the resort.
Those numbers will be required starting a month before construction starts, which could be several years away, if at all.
The district will ascertain if enough water has been pumped from the Seaside Basin to supply the resort. “The courts have said we have a right for strict accounting,” Stern said. Under orders from the state to sharply reduce pumping from the Carmel River, Cal Am is seeking to develop a new water supply project with a desalination plant near Marina.
“It was an expected step,” Roth said of the water district permit. “The claim (the project) didn’t have available water obviously has been put to rest.”
Ghandour’s plan first called for a 495-unit hotel-condominium-timeshare complex and a conference center. The smaller, 341-unit proposal calls for 161 hotel rooms, 180 condominiums, a restaurant, conference center, spa and three swimming pools — all terraced into the dunes in sweeping curves.
The Coastal Commission staff maintained the current design was still too big for the site and would threaten ocean views and natural dunes.
Ghandour’s attorney Roth said, “It’s a world-class project. I’m confident about this project, just as I was confident about the water permit.”