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Home My WebLink About14 - City Support for a 50-Year Lease from the County of Orange for the Newport Beach Golf Course14-1 NEWPORT BEACH City Council Staff Report COUNCIL STAFF REPORT CITY OF February 23, 2016 Agenda Item No. 14 ABSTRACT: A 32-acre portion of the Newport Beach Golf Course is leased from the County of Orange. The current operator and lessee of the golf course wants to invest in significant course improvements, and are requesting a lease extension from the County to extend the term to 50 years. An extended lease might help preclude the same land’s use for an expansion of John Wayne Airport (JWA). RECOMMENDATIONS: Authorize the Mayor to sign the letter and send it to the Orange County Board of Supervisors. FUNDING REQUIREMENTS: There is no expenditure of funds related to this item. DISCUSSION: The Newport Beach Golf Course is a privately-run 18-hole executive golf course located at 3100 Irvine Avenue in Newport Beach (see attached map). The course offers affordable golfing and driving range practice for both residents and visitors to the community. The northern 32-acre portion of the course sits on leased County land for the next five years. Newport Beach resident Buck Johns leads a new ownership group for the golf course, one that plans to invest to improve the fairways, greens, driving range and restaurant facilities. To the investment group, the improvement plan (see attached) TO:HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL FROM:Dave Kiff – City Manager 949-644-3001; dkiff@newportbeachca.gov PREPARED BY:Rob Houston – Assistant to the City Manager TITLE:City Support for a 50-Year Lease from the County of Orange for the Newport Beach Golf Course City Support for a 50-Year Lease from the County of Orange for the Newport Beach Golf Course February 23, 2016 Page 2 14-2 requires a long term lease, preferably 50 years, to make these improvements financially feasible. The golf course is an important amenity for the region, as well as providing an important buffer against efforts that would expand existing runways at John Wayne Airport. It has always been important to our community that the airport remain within the same footprint that it exists today. Extending the golf course lease provides additional assurance that this land is not used for Airport expansion for the term of the extended lease. Similarly, the Airport Working Group of Orange County, Inc. (AWG) also supports the request to extend this lease. AWG believes the County owned portion of the Golf Course property should remain as a long-term recreational outlet for local residents (see attached letter of support). As the City’s proposed letter states, an extended golf course lease preserves both continued access to affordable golf facilities and additional assurance that the airport will not use that property to expand its footprint for the foreseeable future. ENVIRONMENTAL REVIEW: This action is not subject to the California Environmental Quality Act (“CEQA”) pursuant to Sections 15060(c)(2) (the activity will not result in a direct or reasonably foreseeable indirect physical change in the environment) and 15060(c)(3) (the activity is not a project as defined in Section 15378) of the CEQA Guidelines, California Code of Regulations, Title 14, Chapter 3, because it has no potential for resulting in physical change to the environment, directly or indirectly. Alternatively, the City Council finds the adoption of this action is not a project under CEQA Regulation Section 15061(b)(3) because it has no potential for causing a significant effect on the environment. NOTICING: The agenda item has been noticed according to the Brown Act (72 hours in advance of the meeting at which the City Council considers the item). ATTACHMENTS: Attachment A - Draft Letter from Mayor Dixon to Chairwoman Bartlett Attachment B - AWG Letter of Support Attachment C - Overview of New Operator Improvement Plan for Newport Beach Golf Course Attachment D - Map of Golf Course Property Office of the Mayor CITY OF NEWPORT BEACH 100 Civic Center Drive Newport Beach, California 92660 949 644-3004 | 949 644-3039 FAX newportbeachca.gov Mayor Diane Brooks Dixon Mayor Pro Tem Kevin Muldoon Council Members Keith D. Curry Marshall “Duffy” Duffield Scott Peotter Tony Petros Edward D. Selich February 24, 2016 The Honorable Lisa A. Bartlett, Chair Orange County Board of Supervisors 333 W. Santa Ana Blvd, 5th Floor Santa Ana, CA 92701 Dear Chairwoman Bartlett: The Newport Beach City Council supports the continued operation of the Newport Beach Golf Course as an affordable recreation asset for Newport Beach and surrounding Orange County communities. The City Council also supports the Board’s consideration of a 50-lease for the County-owned portion of the course, as this should enable significant new investment to improve the course and associated facilities. The golf course is an important amenity for the region, as well as providing an important buffer against efforts that would expand existing runways at John Wayne Airport. It has always been important to our community that the airport remain within the same footprint that it exists today. Similarly, the Airport Working Group of Orange County, Inc. (AWG) also supports the request to extend this lease. AWG believes the County owned portion of the Golf Course property should remain as a long-term recreational outlet for local residents. If you have any questions or concerns about our position, please do not hesitate to ask. Thank you and your colleagues on the Board of Supervisors for the work you do for our region and for your consideration of this request. Sincerely, Diane Brooks Dixon Mayor of Newport Beach cc: Members of the Orange County Board of Supervisors Mr. Barry Rondinella, Director of John Wayne Airport Members of the Newport Beach City Council ATTACHMENT A 14-3 ATTACHMENT B AWG Airport Working Group of Orange County, Inc. February 8, 2016 Honorable Mayor Diane Dixon City of Newport Beach 100 Civic Center Drive Newport Beach, CA 92660 Dear Mayor Dixon , !( ·~·~ .... ~~~ ., i""• 1 ; "j ~-~ ; ~ i ( ~) ... I' I I I I ·-· ··r ) .. , __ , • I ·) l I ' . ~ ~ ...... ~ --. . . !;..:_.' • -...' : i -, At the start I would like to thank you for your commitment to limiting the gr ~1Wth and ~~ise \ ) impacts of John Wayne Airport (JWA) on Newport Beach re sidents. ..t:: .... In 2010 the Airport Working Group (AWG) worked exten sively against turning the Newport Beach Golf Course adjacent to JWA into an airport parking lot. We lobbied City and County officials and, through t heir help the project was ultimately dropped and the County Board of Supervisors signed a 10 year lea se with the Newport Beach Golf Course. Wit h five years r emain i ng on the lea se, AWG feel s it is not too early to work for a long ex ten sion th at sa tisfies both AWG's goal of prohibiting ai r port enlargement and the Newport Beach main Corridor Cities' Principle of opposing any expan sion of JWA beyond its current f ootprint. The Golf Course i s the only lighted course in the county and at the same time, continue to provide a recreational outlet enjoyed by many Newport's citiz ens . Your help in the matter will be greatly appreciated. Sincerely, ~l~ Tony Khoury AWG Board Pr esident Date_~'---'-/t_(...;..~,...l/ Y.'--- Co~S e n t To : ~_W,Cou n cil ~~Manage r ~Ci ty Attorn ey ~i !e 1048 Irvi ne Ave nu e • PM B 467 • Newport Beach, CA 92660 • www.awgoc.com 14-4 Overview of New Owner’s Plans For Newport Beach Golf Course February 2016 The Newport Beach Golf Course (“NBGC”) is an 18 hole, par 59 Executive Course located at 3100 Irvine Avenue, in Newport Beach, CA. It was built in 1975 and consisted of 64.3 acres, in two ground leases: one from the County of Orange (the “County Lease” - 32 acres – has 5 years left) and one from a private partnership (the “Fluter Lease” – 32.375 acres – has 11 years left); in addition to the golf course itself, the facilities at NBGC include a driving range, golf shop, bar and restaurant. In its 40 years of continuous operation the facility has become an institution in the Newport Beach area; its relatively low par (predominantly par 3’s) make it an ideal place for beginners to learn how to play, and the central location of the driving range draws many “serious” golfers to this practice area. Unique to the area, the course’s 18 holes are lighted at night, extending the hours of play well into the evening and providing a venue for after-hours social gatherings. NBGC has been supported over the years by both the City of Newport Beach (the “City”) and the County of Orange. It is also a favorite locale for charity fund raising tournaments of all kinds. In recent years, NBGC has fallen into decline for a variety of reasons, most of them linked to the previous owners’ legal squabbles and lack of funding. On December 31, 2015, NBGC was acquired by a group led by well-known, long-time City resident and businessman, Mr. Buck Johns. At that time, both ground leases were also transferred to the new ownership group. The new owner’s plan to make major improvements in a number of key areas: ▪ Improve the Greens and Fairways ▪ Completely restore the Driving Range, adding another level and replacing the existing sparse grass with artificial turf which requires no watering ▪ Refurbish the Bar and Restaurant Facilities ▪ Replace and the lighting system with energy efficient LEDs ▪ Trim all trees The above improvements will be expensive: the new owners will need to finance these improvements over a lengthy period of time in order to achieve economic viability. This means that the County lease and the Fluter lease will need to be extended for 50 years. The City’s continued strong support of NBGC will be vital to obtaining these extensions. ATTACHMENT C 14-5 Newport BeachGolf Course Newport BeachGolf Course Newport BeachGolf Course County ofOrangeCounty ofOrange KLIN E D R S I L V E R L N INDUSST REDL A N D S D R E S T U A R Y L N RIVE R S I D E D R PEG A S U S S T OR C H A R D D R OR C H A R D D R A N N I V E R S A R Y L N CYPR E S S S T ACAC I A S T GOLD E N C I R BIRC H S T BRI S T O L S T MESA D R I R V I N E AVE MesaBirchPark NB_GolfCourse_8.5x11_Portrait.mxd Newport Beach Golf Course City Boundary County of Orange Newport Golf Course LLC0400200 FeetI City of Newport BeachGIS DivisionFebruary 17, 2016 ATTACHMENT D 14-6