Hopes are Malibu Pier will be open again by September 1999. If, however, the city assumes responsibility for improvement, operation and maintenance of the pier, it may lose more than $72,000 per year, according to a report by the city’s recently hired consultant.
The pier has been closed to public use since being declared unsafe last year. The state has already allocated $900,000 “to perform remedial repairs for the purpose of stabilizing the pier structure and three of its four historic structures,” namely the land-end restaurant building, formerly Alice’s, and the outer deck twin buildings, formerly the snack and bait shops, according to the consultant’s report. The “food preparation” building across from Alice’s will not be restored due to its advanced state of deterioration.
To reduce the city’s “financial risk,” the consultant, Williams-Kuebelbeck & Associates, Inc. (W-K), suggested the city limit its involvement to helping pay for part of the pier restoration. Although that would mean giving up the right to collect rent from businesses that will eventually operate on the pier, the city would still meet its “primary objectives,” according to the report.
The city’s objectives are to get the pier open to the public as soon as possible, to assure that the pier does not close again in the future and to have the pier generate financial benefits, albeit not from rent, as initially contemplated, but only from sales taxes, property taxes, business license fees “and other sources,” according to W-K.
Opening could be done without city funding, according to W-K.
City funding, ranging from $850,000 to $1,020,000, could help pay for improving the pier beyond the state’s planned restoration of the basic structure. According to W-K, $700,000 is available from the city’s share of the 1996 Los Angeles County Bond proceeds, $150,000 could come from a grant by the State Coastal Conservancy and $170,000 was promised to the city from the Los Angeles County Department of Harbors and Beaches, although the report states, “This funding is not certain and its continuing availability will have to be verified.” None of this money would have to be repaid by the city, noted W-K.
But money would have to be borrowed, and repaid, if the city chooses to take over reconstruction and operation of the pier, as initially planned. W-K cited a study performed in 1995 by Moffatt & Nichol Engineers, which examined four construction options ranging in cost from $2.8 million to $3.6 million. Based on the study, the city had planned to borrow $2.9 million in proceeds from the 1992 Los Angeles County Proposition A General Obligation Bond, explained W-K.
The city hoped to repay the 1992 bond money, in large part, by collecting rent from businesses operating on the newly restored pier, according to W-K. The city planned to expand development on the pier by 30 percent compared to what was there before the closure, estimated W-K, with space rented out for an upscale and a family restaurant as well as retail stores. But W-K cautioned that the state would possibly object to increased business activity. In addition, the city’s revenue projections “may be too aggressive.” Actual revenue may be so low, “this could cause financial risks to the City which may endanger the City’s General Fund,” stated W-K.
Besides, noted W-K, “the State will accomplish the same purpose of opening the Pier to the public for $900,000 compared with the City estimate of $2,900,000.”
The city estimate is so much greater than the state figure because when Moffatt & Nichol performed its study, “they were told to assume the pier would have to be torn down,” explained City Manager Harry Peacock. But a recent state inspection showed the pier to be in better condition than previously assumed. “Things weren’t as bad as indicated in 1995,” said Peacock.
A final report by W-K is due by early next year, according to Peacock. Until then, no decision will be made about what role the city will play in the pier renovation, he added. But Peacock points out that the state has so far shirked its responsibility to care for the pier. “Why is it closed now? Because the state couldn’t keep it open. They have no ability in the state budget process to set aside funds to maintain the pier,” said Peacock.