Grand Jury releases report on public land sales within county, prompted by near sale of Back Bay parcel

The county of Orange isn’t sufficiently notifying residents about the potential sale of public lands to private individuals, according to a recent report from the Orange County Grand Jury.

In its document, “County Land Transactions: Will the Public Notice?,” the investigative body also identified a number of other faults with the procedures for the sale of public lands in Orange County, including that the county has also failed to properly notify involved state agencies, like the California Coastal Commission, about potential land sales.

The grand jury said it chose to investigate the matter after receiving complaints from residents about the sales of public park land to private individuals. The county owns about 80,000 acres of park land. While it sometimes makes sense for the county to sell land to private people, these sales should be “carefully scrutinized” so that there isn’t any unnecessary loss of valuable public land and to protect against politically fueled deals, the grand jury wrote.

“Notice efforts should include mailings, property depictions, and other information that properly inform citizens impacted by the sale,” the grand jury said. “This information should also be displayed on appropriate websites and published in a manner that will reach the intended audience.”

County spokeswoman Molly Nichelson declined to comment on the report.

A controversial sale in Newport Beach

For its report, the grand jury specifically investigated a proposed sale in the Newport Beach Back Bay area that sparked controversy last year. Voice of OC reporter Brandon Pho covered the deal, where county officials nearly sold a piece of park land to a wealthy political donor, whose home is connected to the parcel, for $13,000.

Initially, the county did not move forward on the homeowner’s proposal. But then, former county Supervisor Michelle Steel stepped in and advocated for the deal, and it gained traction, the grand jury said. Steel is referred to as “then-County Supervisor for District 2” in the report. A spokesperson for Steel did not respond to a request for comment.

The grand jury wrote that the parcel is surrounded by a chain-link fence that was installed by the homeowner that borders a walkway and is near a paved pathway that is used by walkers, bicyclists and equestrians. The land was given to the county decades ago by the Irvine Co. under the condition that it remained park land, and the county eventually adopted a resolution that declared the land where the parcel sits, known as Newport Beach’s Back Bay Reserve, as public land. The California State Land Commission also recognized the area as public trust land. The county resolution noted that the commission leased the property to the state’s Department of Fish and Game for open space.

“With the support of the then-District 2 Supervisor, steps were taken to sell the land with no restrictions despite the predated covenants and restrictions and without regard to the Board of Supervisors and the California State Land Commission’s resolutions that the land shall be held in trust under the stewardship of the State’s Department of Fish and Game,” the grand jury said.

The grand jury wrote that the appraisal for the property, which was paid for by the homeowner, came in “at only” $13,000, even though the added land would “substantially increase” the value of the homeowner’s property. Despite the low price tag, the board voted to move forward with the sale in January 2021. The grand jury said that the staff report that was prepared ahead of the supervisors’ meeting did not mention the previous board resolution permanently designating the property as public trust land.

The grand jury also found fault with the county’s lack of notice to residents.

The county is required to publish a notice of a sale of public land in a newspaper. However in this instance, the county chose to print a notice in the OC Reporter. The grand jury found this to be inadequate, and contended that the notice should have been posted in the Orange County Register or Daily Pilot.

“Although the OC Reporter prints some articles of general interest, this publication exists primarily to provide a vehicle for legal notices,” the grand jury said. “It is not within the spirit of the law to claim that this is the newspaper with the greatest circulation in order to provide notice to local citizens ... In addition, the legal notices published do not provide average interested citizens true notice of what is being sold as the notices are purely legal in nature and the properties are often described by plot number and other technical identifiers.”

The Board of Supervisors was scheduled to vote on the approval of the sale in April 2021, but it didn’t go through due to newly elected Supervisor Katrina Foley tabling the item. Foley took Steel’s seat on the board after Steel was elected to Congress. The grand jury noted that if Steel had remained on the board, “the sale of this land would most likely have gone through.”

Concerned residents who had learned of the issue by word of mouth then started circulating a petition to prevent the sale. According to the grand jury, a petition with the signatures of at least 200 residents can force the board to either stop the sale or put it to a public vote. The petition gathered about 1,300 signatures and the sale has not moved forward. Yet, the chain-link fence is still in place, which the grand jury takes issue with.

“By allowing the owner-installed fence surrounding [the parcel] to remain in place, the County has permitted the homeowner to inappropriately privatize this parcel at no cost to the homeowner and in a manner inconsistent with the well-established public trust designation,” the grand jury wrote.

Recommendations

The grand jury provided a number of recommendations in its report, including that conservation easements and dedications of public trust land should be properly recorded with the county recorder so that they can be adequately referenced when potential sales are being considered. The investigative body also said that the Board of Supervisors needs to establish procedures to make sure that staff reports include information about conservation easements and public trust designations.

The grand jury also recommended that “mailers, social media, meaningful newspaper notices, and physical postings all be utilized to provide proper notice to the public at large.”

Lastly, the grand jury contends that the board should order the removal of the chain-link fence before the end of the year.

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