A Mission Viejo property owner recently stood up to city officials’ secrecy and might bring legal action against the city.

At an April 13 meeting, the Mission Viejo City Council extended negotiations with the Stein Mart property owners to potentially purchase the building on Marguerite Parkway. 

City officials also specified plans to renovate the space, but legal action looms over potential Brown Act violations.

Editors’ Note: This dispatch is part of the Voice of OC Youth Media program, working with student journalists to cover public policy issues across Orange County. If you would like to submit your own student media project related to Orange County civics or if you have any response to this work, contact the reporter Angelina Hicks at anhicks@chapman.edu.

Both the agenda for the meeting and the staff report did not include any notice about discussing the plans for the area. The documents only reported information about extending negotiation rights.

Despite this, staff presented a slideshow depicting specific plans for the area, a discussion that lasted more than 30 minutes and included new information not previously discussed.

The new plans included tearing down part of the building to create an alleyway connection to Oso Creek, building two bridges to extend over the creek, and building a facility to house a new water treatment plant at the other end of the bridges.

Representatives from Ervin Cohen & Jessup — a law firm based in Beverly Hills that represents a property owner in the same shopping center as Stein Mart — agreed that the city officials’ actions violated California’s open meeting’s law, called the Brown Act. 

Jeffery Harlan, an attorney in the firm, sent a letter to Mission Viejo City Attorney Bill Curley and other city officials outlining the violation and demanding corrective action. 

“Ultimately, the item as proposed was just a pretext for the council and staff to discuss the status of the Vision Plan without properly notifying the public,” Harlan wrote in the letter. “This is a clear violation of the Brown Act, and undermines the ability of Mission Viejo residents and businesses to genuinely participate in its government’s decision-making process.”

The firm also represents owners of property at 25310 Marguerite Parkway in the shopping center.

Because this discussion section of the meeting was not listed anywhere on the agenda, Harlan argued that residents were not made aware of the topic and had no opportunity to prepare comments or thoughts on the issue.

Cathy Schlicht, a former mayor of Mission Viejo, also believes the discussion violated the Brown Act.

“It was a misleading title, as it failed to communicate what the discussion would be about,” Schlicht said. “The city attorney will justify it as informational [with] no vote taken, but informational means controlling the narrative [and] not allowing speakers to add their comments in support or opposition.”  

In response, Curley defended the city and the slideshow as an attempt to refresh residents’ minds regarding the renovation efforts that haven’t been publicly discussed in a few years.

“The extension, in an effort for transparency, clarity and context called for a refreshing of the recollection of that previously adopted and in place plan,” Curley told Voice of OC. “There was no action on the core area vision plan. It was revisited to give context only, and so there was nothing about the plan to discuss, debate, plan for or otherwise react to. The Brown Act doesn’t require listing of all backup or context data that supports an action.”

In a letter response to Harlan, Curley denied any need for corrective action.

“You will not find any action of any type seeking the adoption of amendment to or any other action on the Core Area Vision Plan,” Curley wrote. “As noted, that information was background and context information only. Again, putting an action in context is not a violation of the Brown Act, or any law, regulation or policy. Accordingly, we find nothing requiring cure or correction and will not take any actions to satisfy your demand.” 

Kelly Aviles, who serves as Voice of OC’s chief litigator, agreed that the accusations, if correct, would constitute a Brown Act violation.

Regardless, the council voted unanimously to extend the negotiations with the Kinstler Family Trust at the April 13 meeting. 

The negotiation extension also comes at the same time as a projected revenue loss for the city. 

At the same meeting, Cheryl Dyas — the director of administrative services for finance and human resources — said that the city expects to lose $2 million in sales tax during the revenue projections report for 2021 to 2023.

According to Mission Viejo’s city budget, sales tax is the second biggest revenue source for the city, generating 20% of income for the 2019 to 2020 fiscal year.

Stein Mart building in Mission Viejo. Credit: BROOKE LUTZ

Gail Reavis, a former mayor from Mission Viejo, sat on the council when city officials originally began discussing revitalizing the shopping center. Reavis disapproves of the council’s financial expenditures.

“I hated the original plan, which did not include Stein Mart,” Reavis said. “It was a complete sham, big dreams from politicians. I don’t know how they plan to pay for this … I don’t know where the money will come from especially since sales tax revenue has taken a tumble with COVID. These current council members just spend, spend, spend.”

Although purchasing the Stein Mart property and creating bridges will cost Mission Viejo millions of dollars more than it’s already exempted to lose in the next two years, Mayor pro tem Wendy Bucknum said that it’s worth it to continue negotiations and invest in the downtown area across the street from city hall.

“Our economy has been really truly decimated,” Bucknum said during the April 13 meeting. “We have to face this reality, and we have to take some bold moves …  I wholeheartedly support extending this so that we can do proper due diligence and negotiate something that is going to be very good for all of our citizens.”

Schlicht further questions the current council’s vision and choice to spend money on this endeavor.

“We are told this is an important investment in our city, good for our citizens, and it opens more doors,” Schlicht said. “They tell us that without explaining what door and at what cost. What I see is the loss of revenue with a government takeover of private property: loss of property taxes, loss of sales tax revenue, and for the citizens looking for a local job, loss of employment opportunity.”  

Oso Creek in Mission Viejo. Credit: CATHY SCHLICHT

In addition to the price for the project, another concern from Mission Viejo residents regarding the downtown area is Oso Creek. Connecting the area to Oso Creek, which runs behind the buildings in the shopping center, is a big emphasis in the long-term plan for the space. Purchasing the Stein Mart building will provide the opportunity for city officials to accomplish the goal and connect people to the creek.

However, residents complain about the creek, especially the smell and lack of running water during the majority of the year.

To combat these issues, assistant city manager Keith Rattay described that the Santa Margarita Water District has done research in the past two years to reduce the smell through their water treatment technology.

“Out in Rancho Mission Viejo, [the water district] developed a new water treatment facility, and it’s almost impossible to get any smell really from it at all,” Rattay said during the April 13 meeting. “It really in our mind is a nonissue at this point.”

According to Mission Viejo’s vision plan website, the Santa Margarita Water District is currently under design to demolish the original treatment plant and rebuild it using an updated treatment process to reduce nearly all sound and smell problems. The project construction is set to start within the next nine months and is anticipated to take three years to complete.

Rattay also discussed the possibility of including small restaurants on the bridges across Oso Creek for people to eat and enjoy the views without any odor from the creek.

The difficulty in moving forward with shopping center revitalization — which has been in the works since at least 2007 — stems from the 14 different property owners in the area. City officials say that the Stein Mart owners approached the city with means to sell, and the opportunity for the first step toward the renovation became clear.

“The city is having to start the field of dreams, and if you put the vision plan out there, they will come,” Bucknum said. “That is exactly what happened for the owner of Stein Mart to come forward to us because this vision plan was out there … This is where we can help with economic development.”

Robert Breton, a former mayor of Mission Viejo, gave a public comment at the April 13 meeting. He wrote that in the early days of the city’s history, officials chose to subdivide the center into 14 small parcels to sell to individual owners instead of a singular investor. Additionally, Breton wrote that the closing of the Stein Mart is an unusual circumstance that allows city officials the opportunity to advance on the revitalization efforts. 

“The city is now unable to turn this old, run-down, underused, unattractive retail center into an exciting new village center without trying to deal separately with 12 different owners or their estates and trusts, all of whom are more than content to continue collecting the rents on their leases and have no real incentive to invest in badly needed renovations to the old village center,” Breton wrote. “This could very well be our only chance to break the logjam.”

Mission Viejo staff presented a slideshow with plans to implement if the city purchases the Stein Mart building. This illustration depicts ideas to create an alleyway connection to Oso Creek where the Stein Mart building currently stands. Credit: Photo Courtesy of City of Mission Viejo

On the other hand, Reavis emphasized that Mission Viejo city officials have been less than forthcoming regarding plans for the renovation. 

“I want to see how they are going to do this,” Reavis said. “I want practical work, not pretty pictures drawn by a very expensive consultant. I want to know how.”

Many plans for the renovations have occurred privately in closed sessions or in small committees, which are exempt from the Brown Act.

Current council members Ed Sachs and Brian Goodell — who were appointed to serve on an ad hoc committee for the Stein Mart negotiations March 31 — also serve on the economic development committee for the city, according to both their information pages on the city website. Both these committees, under state law, meet privately.

In addition to non-transparency regarding private talks, Reavis also emphasized that the council fails to answer the public’s questions and inform Mission Viejo residents about the Stein Mart purchase and renovation plans as a whole.

“They never talk about things,” Reavis said. “They’re getting away with something when they say it’s a closed door session and its negotiations and they can’t talk about it to us. They would’ve let us know a lot of stuff by now. I was on the city council for eight years. I was mayor twice. I know what they can talk about and what they can’t talk about.” 

Although Schlicht and Reavis both criticize the council, the current members emphasize a different story. 

“The direction this council is going, especially in the last couple of years, should be a pride for all of us to shoulder,” Sachs said. “Anyone who besmirches what we’re doing here should be absolutely ashamed of themselves … When I was in business, standing still was always going backwards. Mission Viejo is not standing still.”

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