The Coastal Commission will vote on a Cease-and-Desist Order at its April 13 meeting regarding the Temescal Trailhead bathrooms and parking lot located at the top of the Palisades Highlands Summit.
If approved, Wooster Street LLC (owner Henri Levy) would completely clean the restrooms to return to a sanitary state and re-key the restrooms so that moving forward, the two bathrooms will be available to the public.
Once clean, Wooster has agreed to immediately transfer the title of the Trailhead Property to an Executive Director-approved not-for-profit entity. Wooster is concurrently agreeing to not seek compensation from the Commission for the more than $300,000 spent to purchase the property.
Finally, Wooster will dismiss the ongoing litigation against the Commission, and ensure that the Trailhead Property is brought into compliance with the public access provisions of the Coastal Act and the CDP.
Commission researchers wrote “By agreeing to take immediate action to clean the facilities and transfer the property to an appropriate entity (in addition to dismissing the litigation), Wooster is ensuring that public access will be restored in weeks rather than the potential years it could take if one were to wait for the issue to be decided in a court, and provides this area will be restored to the public for public uses as intended in the original permit.”
This tale of noncompliance by the Headlands Property Association, which was the original owner, was uncovered by a Palisades reporter Sarah Stockman in 2016.
In a 2022 April story, Circling the News reported the California Coastal Commission cited the Headlands Property associates for failing to properly turn over the Highlands Trailhead property to the City or other nonprofit, failing to maintain the bathrooms and failure to pay taxes on the property.
Before ordering this current Cease and Desist order, the CC reached out to the Headlands Association and offered to reduce its civil liability from $6 million to $5 million if they worked with Wooster, with a September 22 deadline. It did not, so Headland Orders are separate from the Wooster Order and Wooster will act alone in ensuring that the property is cleaned and transferred to an appropriate entity.
Stockman wrote in her 2016 story, “Headland built the parking lot and restrooms on the property in the 1990s as part of a 1983 agreement with the Coastal Commission that allowed them to build The Summit in the Highlands. It was classified as a piece of privately owned land, despite the Coastal Commission limitations.
“Due to its private ownership, property taxes were required to be paid. However, Headland never paid them.
“[Property taxes] should never be paid on those properties because they’re public,’ said Ed Miller, CEO of Cal-Coast Homes, which is the current incarnation of Headland Properties.
“The original deal between the Coastal Commission and Headland said that Headland could deed the property to the City of Los Angeles or to a nonprofit, although no agency was required to take it.
“Headland deeded the property to the Department of Recreation and Parks in 2003. The department did not accept the deed due to budget cuts, but Miller says the city never informed Headland of its decision.”
CITY REC AND PARKS:
According the CC summary, 1) the City had independently required the creation and dedication of the Trailhead Property, 2) the City passed an ordinance to accept property granted by the developer in conjunction with the development of the Palisades Highlands, 3) the City Parks board passed a resolution to accept the Trailhead Property, and 4) City Parks subsequently maintained the Trailhead Property and facilities, the recordation of the grant deed was never effectuated, and Headlands remained the record owner.
The County Assessor never received notice that the property was in public ownership and continued to assess taxes to Headlands.
Headlands did not pay the tax bills, which was its responsibility, and the property entered into default on June 30, 2000.
A Notice of Power to Sell Tax-Defaulted Property was recorded against Trailhead Property on July 2005. It was sold at a public auction in February 2006.
The purchaser became aware of the restroom and parking lot development, and notified the tax assessor, and an independent review of the property was undertaken.
The tax assessor determined that the Trailhead Property was “dedicated and accepted by the City of Los Angeles” and based on this analysis rescinded the auction sale and recommended that the parcel be changed to a tax-exempt, publicly-owned property.
The City indicated a plan to record documents and the tax assessor excluded the Trailhead Property from its 2007, 2009 and 2010 public actions.
But the City again failed to record the requisite documentation, which prevented the tax assessor from changing the parcel to tax exempt.
Pursuant to California Revenue and Taxation Code Section 3692, the tax collector must attempt to sell property within four years of the time that the property becomes subject to sale for nonpayment of taxes. If it is not sold, then the tax assessor must attempt to sell the property.
To comply with state law, the property was offered at public auction in 2012 and 2013; and the property was sold to Levy in October 2013 for $350,000.
The CC noted that Headlands did not notify the board that the Trailhead Property was in tax default proceedings nor make any attempt to stop the sale, nor was the Commission staff given notice of the pending sale.
“There is no evidence that Headlands attempted at any point in this process to comply with the permit requirements regarding the property,” the staff reported said. “To the contrary, after the property was sold in 2013 for more than the minimum bid amount, Headlands made an ‘excess proceeds claim’ to the tax assessor, in order to profit from the sale by recovering some of the sale proceeds. This claim was approved, and the tax assessor transferred $329,521 to Headlands in June 2016.”
Levy deeded the Trailhead Property to Wooster Street and in 2016 put it on the market and advertised it was available for residential development.
A reporter Stockman reached out to the Commission to ask if the CDP conditions still applied. Permit staff researched the matter, provided a response to the reporter, and forwarded the case to the Enforcement division.
In 2020, Levy filed suit against the City of Los Angeles, the County of Los Angeles, the State of California and Headlands. The suit initially sought to stop the Commission’s enforcement of its permit requirements, require the return of $333,114 and require that the defendants pay Wooster $2 million in damages.
With this order, Wooster (Levy) will dismiss its suit against the Coastal Commission and restore the bathrooms.