Black Hole Gets Green Light

Mountain Funding Given Until 2014 to Develop Bottom of State Street

Santa Barbara City Administrator Jim Armstrong gave a new lease on life to long-deferred development plans for the bottom of State Street. The developer aims to transform three blocks located near State and Mason Streets into a sprawling complex of 123 hotel rooms and nine time-share condos. In exchange for a finding that these plans are in substantial conformance with those already approved, the developer will be required to rectify what one planning commissioner termed “demolition by neglect.”

Approval for earlier plans to redevelop the area into a time-share condo community — dubbed La Entrada — went nowhere despite winning approval from City Hall nine years ago. Since then, in fairly short order, many shopkeepers were evicted, a large hole-in-the-ground was dug — the intended foundation for a new parking garage — and the original developer, Bill Levy, declared bankruptcy. Mountain Funding took over the project in 2007, but precious little construction has occurred. Financing for the project has always been problematic, but in the current recession, high-risk construction projects like La Entrada have been all but un-fundable.

Late last year, Mountain Funding submitted new plans—more hotel rooms, fewer time-share condos—and has sought from City Hall a finding of “substantial conformance.” Without such a finding, the project, which has already exhausted all permit extensions, would be dead on arrival.

Administrator Armstrong concluded that the new proposal, which would be a half-story lower than the one already approved, is in substantial conformance. But in exchange, he demanded some assurances, among them that that Mountain Funding finish construction no later than 2014. The developer must also make any seismic repairs to the Californian Hotel within 180 days that are deemed necessary by the city building inspector. Within 30 days, Mountain Funding has to apply a new coat of paint to the side of the hotel facing the beach, and hire a maintenance crew to make sure the area is landscaped, irrigated, and swept at least as well as the 400 block of State Street. To that end, Armstrong required that Mountain Funding post a $20,000 bond. He also required the developer to post a $500,000 bond City Hall would use to fill in the excavation site should Mountain Funding fail to proceed.

Longtime critic Tony Romasanta, who owns a hotel near the site, was not impressed. The project, he insisted, will never get built because it makes “no economic sense.” He wondered why only one side of the building needed to be painted. As for the other conditions, he said they were too vague. “It’s the kind of stuff you could argue about forever.”

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