SAN RAFAEL, Calif.—The California Coastal Commission on July 10 gave a major approval that will allow the conversion of 29 empty acres in Huntington Beach, called the Magnolia Tank Farm, into a mixed-use residential, commercial and open space project.
It will be built under a Project Labor Agreement with the Los Angeles/Orange Counties Building and Construction Trades Council.
Although Magnolia is an Orange County project, the vote was taken in San Rafael, since the monthly commission meetings are held in locations throughout the state.
Andrew Gonzales, Council Representative for Orange County, made the trek up to the Bay Area city to support Magnolia developer Shopoff Realty’s request for a zoning change.
He was successful, with a 9-0 vote, and one member abstaining.
“We have a unique opportunity here today,” Gonzales told the commissioners. “We have a Project Labor Agreement that will ensure high quality wages, that workers are treated fairly and that the local community is going to benefit from these jobs.”
Doug Mangione, political coordinator for IBEW Local 441 in Orange County, said the project will enhance the abandoned property and give residents and vacationers “California’s renowned coastal experience” while providing “local construction jobs with family-sustaining wages and benefits and good, permanent jobs for hotel workers.”
“The construction phase alone is expected to generate 2,000 union construction jobs,” noted Brian Kruep, business agent for UA Local 582 Plumbers and Steamfitters. “The Project Labor Agreement will also prioritize local hire, which will benefit the local economy while reducing vehicle emissions from workers traveling long distances.”
Representatives many unions and labor organizations gave full-throated support.
“From the State Building Trades point of view, this is an excellent project, said Mark Mulliner, Northern California Regional Director for the State Building and Construction Trades Council. “It’s going to bring lots of youth into the Trades from the local community.”
Union Built
Speakers also emphasized the project’s unique take on union-built housing: At least 20 percent of the new homes will be affordable apartments. The first leases to live at half of those apartments will go to income-qualified workers employed at the proposed on-site hotel. The other half will be slated for workers at several nearby hotels.
It is a potential model for providing affordable workforce housing on the California coast, where tourist-magnet cities like Huntington Beach are often short on such homes.
The development will feature a 215-room, lodge-style hotel with some lower cost rooms designed for families; 250 for-sale and for-rent homes; retail and restaurants; public parks and trails, and a conservation area to buffer adjacent wetlands.
The site was previously used to store fuel for a nearby power plant.
Angie Flores, organizer for SMART Local 105, said transforming the site will help to address California’s housing crisis. “The effort is a crucial step toward meeting Orange County’s mandate to build 180,000 new housing units, with the city of Huntington Beach specifically required to provide 13,000 units, by 2029,” Flores said.
“Huntington Beach is behind in its housing numbers by a lot and if the Coastal Commission denies this project, it will contribute further to California’s housing shortage,” said Luis Aleman, regional director of the Orange County Labor Federation.
The 51 below-market-rate apartments will be priced to accommodate low to extremely low-income workers, with their earnings categorized as a percentage of the Orange County median income, which is $44,190 for an individual and $109,361 for a household.
Besides hotel employees, these could include postal workers, police officers and teachers, said Alexa Washburn, chief development officer for National Community Renaissance, a nonprofit organization that has partnered with Shopoff to develop, own and manage the affordable apartment complex.
At the request of the commission, Shopoff and Washburn agreed to place deed restrictions on the apartments so they will remain affordable “in perpetuity.”
William Shopoff, president and chief executive of Shopoff Realty Investments, said the affordable housing component “is a strong precedent and hopefully others will follow it.”
While praising the project’s benefits, the commissioners said they took to heart the concerns of the project’s opponents, who criticized as foolhardy the plan to place housing so close to the Ascon toxic landfill, which borders the project to the north and is not part of Magnolia Tank Farm.
“To most of us it is illogical that anyone wants to live next to a superfund (landfill) who doesn’t have to,” said Commissioner Dayna Bochco.
Remediation
Several commissioners told Shopoff they would like to prohibit construction of any housing until the Ascon landfill is completely remediated. Nick Ta, speaking for the state Department of Toxic Substances Control that is overseeing remediation at the landfill, said work was halted in 2019 until a method could be found to suppress odors.
He said the state-approved remediation process, which consists of contouring and capping the toxic materials at the landfill, is expected to restart in September and conclude in 2026.
The commissioners added a requirement for testing to assure the development site is free of contamination that exceeds residential standards before construction begins on the houses and apartments, and again before they are occupied.
The commission staff a year ago recommended denial of the Magnolia Tank Farm project because of concerns about flooding hazards in the low-lying area posed by climate change that might be worsened by runoff from the new development; a possible health threat from Ascon; and arguments that the land should instead be used for flood control infrastructure to protect the surrounding community.
But at the July 10 hearing, the staff reported that all their reservations had been resolved and they believed the project can meet Coastal Act mandates.
“We don’t take the change of our recommendation lightly,” said Dr. Kate Huckelbridge, the commission’s Executive Director. “The bottom line is that after a lot of technical study, we believe the project as envisioned by the local coastal plan amendment will not substantially make things worse or better in terms of hazards for the city.”
Mauricio Escobar, a consultant on the Magnolia Tank Farm project and a geologist, said fuel tanks, piping and contaminated topsoil were removed from the site. After that, based on extensive soil and groundwater sampling and testing, the California Department of Toxic Substances Control concluded that the site could be developed for housing.
“The site itself is clean,” Escobar assured the commissioners.
Escobar said perimeter groundwater wells and air monitors currently do not show any migration of contaminated water beyond the boundaries of the landfill.
The commission staff added that the rising sea level is not expected to spur future migration of contaminated groundwater from the landfill to the Magnolia Tank Farm development, although air and water will continue to be tested.
Before voting, Commissioner Meagan Harmon said, “I really do think what we are doing up here today is a balancing act.” She said that while the commissioners have responsibility to ensure public safety, they also have responsibility to heed the voices of those needing affordable housing.