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County rejects Naples land deal!

Developer vows to amend, resubmit agreement for stretch of Gaviota coast.

February 23, 2000

An agreement between an Orange County developer and the Malibu Nature Trust for the future purchase of land at Naples has been rejected by the Santa Barbara County Counsel's office on the grounds that it does not protect the public's interests.

In a recent letter to Matt Osgood, president of Vintage Communities Inc. of Costa Mesa, county lawyers objected to what they said were unacceptable provisions governing the proposed sale of 222 acres south of Highway 101 on the Gaviota Coast as a nature preserve. The letter was presented to the county Board of Supervisors on Tuesday.

Last month, the board entered into a deal with Osgood to allow him to apply to build 88 homes on 263 acres on the north side of 101 at Naples -- if he found a potential buyer for the south side by Feb. 15. The rejection of the purchase agreement this week means that the deal is off -- unless Osgood makes some changes and the board decides to extend the deadline.

"We recognize this was a first attempt to satisfy the requirements," Chief Deputy County Counsel Alan Seltzer said. "Hopefully, on resubmittal, we expect that a lot of these deficiencies will be eliminated. The ball is in Mr. Osgood's court."

On Tuesday night, Osgood said he planned to amend the agreement in short order to meet some or all of the county's concerns.

"It's hard to match goals with five supervisors on the first time through," he said. "We did our very best to meet obligations and act in good faith. I'm not completely surprised that there are a number of issues I need to respond to. My hope is that we can match goals on all of them."

One problem is that the agreement between Osgood and the Nature Trust requires the approval of a minimum of 88 homes on the north side of 101 at Naples before the purchase of the south side can be completed. This conflicts with the provisions of the county's deal with Osgood, which allows the board to approve fewer homes, depending on the impacts to the environment.

On this point, Osgood is not prepared to give way because, he says, he is offering to sell the southern parcel for less than the market value. The ability to build 88 homes, he said, is "something that's important to us, based on what we offered up."

Another problem, according to the County Counsel, is that the purchase agreement does not take into account the estimated 21 months it will take for the county to review and make a final decision on Osgood's development proposal. The letter from the County Counsel states that the sale of the southern parcel must be phased so that the purchase agreement is still effective when the homes are finally approved.

The letter also expresses concern that Osgood is not giving up his water rights on the south side of 101. The absence of water rights, it states, could lead to a lower appraisal of the land, causing the Nature Trust to withdraw from the agreement.

Osgood also retains the right to approve any improvements at Naples south of the highway, and the right to buy back the property if there is a breach of contract -- two more provisions the County Counsel's office does not like.

"Public agencies are not going to acquire a property where a private developer has a veto," Seltzer said. "And we just can't take the risk that it would be repurchased for development."

Osgood responds that he, too, hopes to prevent development on the southern parcel at Naples -- by retaining the water rights and the right to buy the land back. He would, of course, give up enough water for public use of the preserve, he said.

"I think, conceptually, we agree with the county," Osgood said. "We have plenty of water to support development on the south, but we don't want it developed."

Finally, the County Counsel told Osgood that he must provide more information about the directors of the Nature Trust and their track record in raising money to preserve large properties such as the one at Naples.

"It will provide a comfort level that the Optionee is skilled and experienced in negotiating and accomplishing these kinds of transactions ... " the letter stated. Associated Press News Wire