Martins Beach access negotiations stall: State Lands Commission may discuss eminent domain, lawsuit

Nestled in a secluded cove just south of Half Moon Bay, the contended crescent-shaped property’s gates have been under the control of venture capitalist Vinod Khosla since he bought the 89-acre site for $32.5 million in 2008.

A few years later, the public was shuttered from the beach that was once accessible for a parking fee for nearly a century. The closure prompted two ongoing lawsuits filed by advocates, followed by 2014 legislation requiring the SLC to negotiate for access. In September, Khosla filed a suit alleging the state and county were infringing upon his private property rights.

The SLC will meet Tuesday and the public is encouraged to offer input before officials decide in closed session whether to proceed with attempts to reopen Martins Beach to the public.

For many involved on either side of the debate, the issue has risen above this particular property as many predict the results could set a precedent on whether private property rights should trump the public’s rights to access California’s beloved coast.

“I’ll be there on Tuesday to testify and advocate for public access at Martins Beach,” said state Sen. Jerry Hill, D-San Mateo, who crafted legislation requiring the SLC to negotiate with Khosla. “I think it’s important that the commission hears from the public about how important beach access is not just at Martins Beach, but throughout California.”

The SLC spent two years attempting to negotiate with Martins Beach LLCs to buy an easement overlaying the existing Martins Beach Road — a paved access route winding through fields and a bevy of hillside homes down to the publicly-owned tidelands.

But efforts have stalled as the property owner is ardently opposed to willingly sell the 6.4-acre easement and has opined an access route alone is worth $30 million, according to a report prepared by SLC Executive Officer Jennifer Lucchesi.

Instead, after SLC officials met with Khosla and his attorneys at his Menlo Park Khosla Ventures headquarters, he offered two options. Either the state should purchase the entire property at fair market value, or he would be willing to reopen the beach for a certain number of days based on a self-reported logbook from 2008, according to Lucchesi.

However, staff does not believe reopening the property contingent on the incomplete logbook would satisfy the intent of Hill’s legislation that prompted negotiations, according to Lucchesi.

State options

To break the stalemate, the SLC — comprised of Lt. Gov. Gavin Newsom, State Controller Betty Yee and state Finance Director Michael Cohen — will meet Tuesday to consider how, or perhaps even whether, to proceed.

Their options could range from doing nothing, requesting more information while deferring action, or beginning the process of eminent domain — which requires litigation and would be discussed during a closed session later in the meeting.

The public will have an opportunity to share input before the commission deliberates and it’s not yet clear whether officials will publicly announce what route they decided to take.

Outside of being extremely controversial, there is one prime holdup to eminent domain — the SLC doesn’t have the money. An existing fund set aside for land acquisitions has about $6 million and could have been tapped for a negotiated settlement. However, that money cannot be used for condemnation and is meant to cover needs throughout the entire state.

Financing eminent domain could include the governor allocating money in the budget or the Legislature approving funds. Hill said he plans to discuss crafting new legislation on Monday in anticipation of whether the SLC decides to move the ball forward.

“I think Mr. Khosla has indicated a total disregard for the system and the rights of Californians to enjoy their public beaches and I think that will not resonate well with my colleagues in Sacramento; and the continuous legal challenges, especially with the most recent lawsuit [he filed] against everyone in government,” Hill said.

Private property rights

In late September, the tech investor filed a lawsuit in federal court against the SLC, the California Coastal Commission and San Mateo County alleging his constitutional rights — specifically related to private property rights — were violated.

The suit asks a federal judge to declare the SLC’s legislatively-established authority to use condemnation be found unconstitutional, according to the lawsuit.

Dori Yob, an attorney representing Martins Beach LLCs, noted Khosla was willing to restore access under specific terms. The prior owners operated it as a business by charging for parking, and Yob indicated they have been willing to reopen it on days when historical demand exceeded 10 cars. She described the demand for access as limited, but that Khosla has offered to increase education and programs related to restoration and preservation of species, Yob wrote in an email. Khosla has also offered to sell the entire property at fair market value, she wrote.

Yob sent a link to a blog post regarding the matter, in which she said the case is misunderstood and fundamentally about the right to close a business or charge for parking on private property.

“The controversy around Martins Beach involves important property rights that only the courts can decide. It’s unfortunate that government agencies have refused to acknowledge the owner’s fundamental property rights resulting in controversy and litigation and precluding any meaningful dialogue between the owners and the larger community. The United States is about rule of law, not populism, or press or ‘what we wish was the law,’” Yob wrote.

Legal proceedings

With Khosla’s well-known assets and financial abilities, many have predicted his attorneys are ready to potentially take the cases all the way to the U.S. Supreme Court.

The advocacy group the Friends of Martins Beach and the nonprofit Surfrider Foundation filed separate suits against Khosla which have made their way to state appellate court.

The SLC maintains it has the power to use eminent domain in the interests of protecting the public’s rights but ultimately, it could be up to a judge as the matter requires litigation with the attorney general representing the state.

The SLC has never actually flexed its authority to take private property and it’s unlikely to go down that route lightly. After hearing from the public in Sacramento Tuesday, the commission will meet in closed session to discuss either taking a landmark step toward eminent domain, or only focus on defending against Khosla’s suit.

“Ideally for me and I believe for the people of California, the State Lands Commission should move forward with eminent domain proceedings. At least start the ball rolling [and] continue to try and reach some type of settlement if possible,” Hill said, noting Martins Beach could be detriment in other cases. “It could set a bad precedent that others can violate the California constitution.”

Visit www.slc.ca.gov for more information or to submit comments.

samantha@smdailyjournal.com

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