PASSED, YET FAILED
Mammoth Lakes Planning and Economic Commission held a public hearing on Wednesday morning to discuss allowing Outbound Mammoth’s (formerly Sierra Nevada Resort) parent company, Waterton, to convert twenty recently-built villas (five fourplexes located in the middle of the property) into for-sale ownership units.
The amendment to the project’s specific plan passed by a 2-1 vote at the meeting, but the result was later invalidated when Sheet Publisher Jack Lunch raised the issue of the vote’s incompliance with California government code to Town Attorney Andrew Morris, who confirmed the mistake.
The amendment will have to be re-agendized for a future meeting – likely in February, 2025.
Calfornia Government Code 65354 states, ” The planning commission shall make a written recommendation on the adoption or amendment of a general plan. A recommendation for approval shall be made by the affirmative vote of not less than a majority of the total membership of the commission.”
Code section 65453 clarifies, “A specific plan shall be prepared, adopted, and amended in the same manner as a general plan.”
Translation: If you’vce got a five-person commission, you need to count to three.
And on Wednesday, the motion “passed” with Commissioners Michael Vanderhurst and Dawn Vereuck in support and Commissioner Greg Eckert opposing.
Commissioners Lana Grand and Cynthia Fleming were absent – but Ms. Fleming is conflicted out on the vote because it is expected she would be the listing real estate agent of the property.
So Ms. Grand will represent the deciding vote.
Eckert was the sole opposing commissioner to the amendment, calling it a “stake in the heart” of the project’s original concept. He went on to say the sale of these units would create a sort of legally bound “island” on the project, potentially causing roadblocks for future development.
“The use will be the same, I agree with that,” he said. “But, to me, if we’re going to take this as just 20 units, I think we’re really diluting ourselves as to what we’re actually doing.”
The land these villas sit on has a long history of planning for future development, and a short history of development itself. The site is a six-acre rectangular parcel bordered by Old Mammoth Rd. to the east, Sierra Nevada Rd. to the south, Laurel Mountain Rd. to the west, and the Mammoth Mall to the north.
The original plan, Clearwater Specific Plan, was conceptualized by Jim Demetriades, who took ownership of the site in 2008 with the idea to turn the site into a mixed-use resort aligned with the town’s general plan. Demetriades’ ambitious 2009 project proposal included 340 hotel units, retail, restaurant space, workforce housing, and recreational amenities.
The town adopted his proposal, but the development’s execution was ultimately hindered by the 2008 financial crisis. Over the years, Demetriades sought amendments to the plan to make the project more viable, including increasing building height and residential square footage, but financing remained difficult.
Demetriadis eventually sold the property to Waterton in 2021 and the company got permission from the town to construct the villas, along with other improvements, around the same time as its acquisition of the property. The Clearwater Specific Plan has remained effective since its inception, and the legal changes to the villas would simply amend it.
“My recollection was that we were at a stage in this project where it was going to turn into something along the lines of a more ambitious project, and that these units were meant to be actually temporary,” Eckert said. “To me, if there’s 20 units that are converted in the middle of this, that’s game over.”
The Sheet reported on Waterton’s initial request to build the villas in the October 30, 2021 issue. One of the stated goals of the villa construction was to allow for future development of the Old Mammoth Project in accordance with the specific plan “if and when market conditions allow,” but the developers did not have any plans for a second development phase in the near future, according to Sheet archives.
“The whole project would work just fine the way it is – all the rentals, all the parking, all the snow storage – it doesn’t change because there’s 20 deeds,” Eckert said. “What changes is these folks may be able to pull out a significant amount of their initial investment, cash it out, but then it’s going to have this forever problem to try to develop it going forward”
The purpose of the amendment is “purely” to help offset costs incurred from project and unexpected costs due to the “macroeconomic capital environment,” responded Daniel O’Berry, AVP of Hospitality at Waterton.
Mark Carney, Waterton’s Land Use Attorney, added that Waterton specifically decided not to vacate the Clearwater Specific Plan because “it does not want to drive a stake into the heart of that big idea.”
There was no town requirement which prompted Waterton to amend the original approval in the Clearwater Specific Plan, but Waterton says it voluntarily requested to do so on the basis that it had received requests about converting these units into townhomes or condos for ownership, but they maintain the main, long-term goal of building out a large number of units.
Even with the villas converted to owned properties, Waterton would still have the opportunity to build 320 condo hotel units on the site pursuant to the “Clearwater Specific Plan,” Carney said. They have not built those units because the financials do not pencil at present.
“We don’t want to put a ‘stake in the heart of it,’ quite frankly, because having that optionality in the land increases the value of our real estate,” said Matthew Maring.
Waterton still has control over how the villas are managed. The company can require owners to follow certain procedures for rentals, such as checking reservations through the hotel’s front desk, said Waterton Attorney Chris Payne.
The primary use of the units will remain as transient occupancy, Payne said. Owners will be subject to occupancy restrictions, ensuring that the units are not used as permanent residences.
Vanderhurst asked if a villa owner could sue for not being allowed to live in or rent the villas permanently, and Morris said the legal documents created by Waterton would make it very difficult for a homeowner to do so.
Parking was a long-winded concern for the commissioners – namely whether the villa guests would be subject to valet service on busy weekends – but Morris said this was ultimately a management issue rather than a legal one.
There were no public comments made about the amendment in person or online on the day of the meeting, which Vanderhurst described as a surprise.
While this may be technically true, Tom Cage did submit comment Tuesday evening.
He is opposed to the specific plan amendment.
From his submission:
“A summary of my thoughts … is that this is a typical money grab by a developer that is asking for forgiveness instead of preparing up front for permission in the development of these 20 units and the amendments, tract map and use permit described above.
… Don’t let the town be hoodwinked by this proposal. This is a DA that was to stay whole and not get divided into small pieces that will create a big problem while a developer leaves with pile of profit from asking for forgiveness instead of permission.”
