In the city of Escondido, one of the most hotly debated issues of the last few years has been the city's purchase of the historic Daley Ranch. The controversy centers on what various individuals believe to be the best use of the 3,030 acre parcel of land. Some individuals and groups believe that the land should be purchased by the City of Escondido and be preserved as a publicpark. There are also many individuals who feel that since there is a great need for new homes in Escondido the land should be developed, thus providing an economic boost to the struggling city. This difficult decision was put before the planned-growth city council in 1996 after eighteen months of secret negotiations. During These negotiations, Shea homes offered to sell the city high interest sewer futures, provided that it also purchase the historic Daley Ranch. For a total of $21 million, Escondido purchased 1,700 sewer and water rights that the city desperately wanted.
    The land had originally been utilized for its oak groves by the Kumayaay and other Indians of the San Diego area. In 1869, a British immigrant named Robert Daley settled the land and established a cattle ranch. The ranch stayed in the Daley family for more than 120 years until it was sold to Rancho Escondido Incorporated. The purchase took place in 1992 by the housing company that was a subsidiary of the Mobile Oil Corporation [1]. Rancho Escondido Incorporated was the original purchaser of the 1,700 sewer and water bonds that would twelve years later be the primary reason for the city's acquisition of the Daley Ranch. Rancho Escondido's intention was to develop the land into a large housing project. The corporation was not successful as the city of Escondido took them to court in hopes of lowering the number of homes to be built. The city was successful, and it was decided that the number of homes to be built would be limited to 1,700. The corporation did not develop the land, but rather sold it to Shea Homes, who then intended to develop the land. The new development would have encompassed a shopping center, an eighteen-hole golf course, and schools to support the new population [2].
    In 1994, the Escondido city council sought to diffuse a financial time bomb that was ticking away toward the year 2007 [3]. The controversy involved the sewer and water futures that were sold between 1992 and 1993 [4]. The futures were sold to individuals or corporations that owned unimproved land either in the city of Escondido or within its "sphere of influence" [5]. By purchasing the futures, the owner was guaranteed a hookup to the city sewer system, as well as given priority over other individuals that wished to establish service [6]. Shea homes possessed the majority of these futures as well as the entire Daley Ranch. The sewer futures were purchased originally for $1,500 each, while the water futures were bought for $900 apiece [7]. The bonds were to mature in the year 2007, accumulating ten percent interest every year. At maturity, the sewer futures were to be worth $21,872 [8], while the water futures were to reach a value of $2,482 per future.
    If the Shea corporation were to hold onto the bonds it possessed, the city of Escondido would have owed the construction company more than $37 million for the sewer futures alone. The city council of Escondido decided in 1994 that they would attempt to purchase back the futures, and simply refinance the debt at a lower interest rate [9]. The 2,132 futures that were sold back to the city were refinanced by resolution number 96-293, as well as EJPFA 96-91. These resolutions issued debt to refinance outstanding sewer connection rights and provided nine million dollars to improve the current sewer system [10]. The money to purchase the water futures was to come from reserved funds that the city already possessed [11].
    By refinancing the sewer futures alone the city saved $2.5 million; the cost of the 3,030 acre Daley Ranch. The $2,500,000 price tag of the pristine Escondido ranch was approximately $800 per acre. The city of Escondido will be able to sell this land at various prices that range from $4,000 to $16,000 per acre. The land can then be sold to individuals or corporations that seek credit from a "mitigation bank". The purpose of a mitigation bank is to maintain a quality environment that will last long into the future. Mitigation banks protect air, water, minerals, plants, animals, and objects of historical value. These lands are sold to developers and individuals who wish to build on environmentally sensitive locations. If, by developing such lands, it is found that there would be detrimental effects, mitigation may be required. As regulated by the California Environmental Quality Act of 1970, the effects of construction have to be determined by either filing a negative declaration, or a complete Environmental Impact Report. The reports must show the significant environmental effects of the proposed construction, as well as potential measure that can be used to mitigate these effects [12].
    The mitigation bank was a key element in the acquisition of Daley Ranch by the city of Escondido. The agreement stipulates that Shea Homes will keep two hundred acres of the ranch for the sole purpose of mitigation [13]. Since the value of the mitigation land ranges in value between $4,000 and $18,000, this places the value of Shea's land in the wide range between $800,000 and $3,600,000 [14].
    Daley ranch has multiple types of environments that can be purchased for differing amounts. These areas include Oak woodlands, Sage Scrub, Chaparral, wetlands, grasslands, and riparian areas [15]. The establishment of a mitigation bank in Escondido is invaluable in that the land is home to aminimum of four different animal species that are listed as either endangered, sensitive, or threatened. There are also thirty-five other animal species being considered for such classifications [16]. In addition, there are 22 different plant species on the ranch that are being considered for listing by the federal government as endangered, sensitive, or threatened [17].
    The different types on environments that exist on the ranch are worth different values. The city of Escondido originally held a minimum of 2,800 acres with the least possible value of more than $11 million. The money raised by the city of Escondido will be placed into two separate accounts: one account will provide for maintenance of the property, while the second will support damaged habitats [18].
    To many residents of Escondido the Daley Ranch acquisition was purely a win-win situation. Susan Cranddall, a high school biology teacher, points out in a letter to the city council that by establishing the ranch as a mitigation bank her science classes would have an opportunity to use the land as an outdoor laboratory [19]. Yolanda Fleet, another resident of Escondido, believes that the preservation of the ranch is important to create a better environment [20]. The citizens of Escondido, as well as others, will be able to enjoy the natural habitat by being able to hike, bike, and ride horses on more than 15 miles of roads and trails on the ranch [21].
    This optimistic opinion was not shared by everyone in the city. Major economic changes had taken place in the city since the 1980 election of the planned growth city council [22]. As times and economic climates changed in Escondido, so did the apparent attitudes of the voters. The population in Escondido was increasing, as would be expected of a North County community, but the job base in the city was steadily declining. Most new jobs to the region paid only minimum wage. The median income for Escondido's citizens since the 1988 election had decreased nearly twenty percent [23]. Housing had also become a major problem with a surplus of low and high income housing, yet very little for those individuals who fell in between. The 1996 election brought about a drastic change to the Escondido City Council. Two new probusiness candidates, Keith Beier (an insurance agency owner) and June Rady (the assistant director of Palomar College's Escondido campus) joined with incumbent Lori Holt-Pfeiler, as well as planned growth incumbents Mayor Sid Hollins and Councilman Jerry Harmon [24].
    The deal was approved initially in August of 1996, after eighteen months of negotiations conducted by a nonprofit organization called the "Trust for Public Lands" [25]. In December of 1996, the new probusiness faction reopened the deal to public input [26]. Councilwoman June Rady was the only individual on the council to vote against the purchase of the Daley Ranch when the second vote was taken on December 11, 1996. Rady was not sure if the city should, in fact, purchase the large expanse of land. She had further concerns about the ranch being placed into a mitigation bank. Councilman Beier ststaed that he was not sure if the public understood that once the deal went through, the land would no longer be available for future development. Beier also had the concern that the ranch would have to be closed down eventually due to budget problems [27]. Since there are more than 30,000 acres of mitigation acres available, as Beier states, "there is no guarantee that the city could sell its mitigation credits" [28]. It was decided that a public meeting should be held on January 2, 1997 to seek public opinion on the matter [29]. All members agreed to hold such a meeting [30]. The response from the public indicated that there was tremendous support for the acquisition of the ranch.
    Escrow closed on the Daley Ranch on January 31, 1997. In less than three months, the historic cattle ranch was open to the public, allowing individuals to roam the beautiful trails. Had it not been for the city of Escondido issuing sewer and water bonds in the early eighties, the Daley ranch could today be the site of seventeen hundred nearly identical houses. Although there is a middle class housing shortage within Escondido, as councilman Beier points out, it may be argued that the near quarter million dollar homes that were to be built would not be in the affordable range of many middle class families. What is important is that a parcel of land will remain in its natural state for an indefinite period of time, allowing multitudinous animal and plant species to have a permanent home. While it is clear that Escondido is in need of growth to inject financial resources into a depressed local economy, one must look beyond money and instead see an area that was once roamed by local Kumeyaay Indians and a British cattle rancher.
End Notes:
[1] Redlitz, Barbara (Escondido city planner), telephone interview, 22 Jun. 1998.
[2] Petrillo, Lisat, ”All They Need Now is the Theme Song >From ” Bonanza,” San Diego Union Tribune 06 Sep.1996:B-3:1; B- 4:2,3,4,5.
[3] Escondido City Council, Daley Ranch Information Packet.1.
[4] Ibid.
[5] Ibid.
[6] Ibid.
[7] Ibid.
[8] Escondido City Council, Daley Ranch Information Packet.1.
[9] Escondido City Council Press Release, Aug.21 96: 2.
[10] Escondido City Council Minutes of 23 Oct.1996.
[11] Escondido City Council, Daley Ranch Information Packet.2
[12] County of Ventura Resource Management Agency, The California Environmental Quality Act (CEQA), January, 1994.
[13] L. Erik Bratt,.”Officials Want 2nd Look at Daley Ranch deal,” San Diego Union Tribune 11 Dec. 1996:B-1.
[14] Escondido City Council, Daley Ranch Mitigation Packet.3.
[15] Ibid.
[16] Escondido City Council, Daley Ranch Mitigation Packet.2.
[17] Ibid.
[18] Escondido City Council, Daley Ranch Mitigation Packet.3.
[19] Escondido City Council Minutes of 23 Oct.1996.
[20] Ibid.
[21] Escondido City Council, Daley Ranch Mitigation Packet.3.
[22] “Election 1996: North County Views,” San Diego Union Tribune 25 Oct 96: B-13:2; B-15:3,5; B-11:4.
[23] Ibid.
[24] L. Erik Bratt,.”Amid Sparring, a New Majority, a Fired Manager,” San Diego Union Tribune 30 Dec. 1997:B-1.
[25] Petrillo, Lisat, ”All They Need Now is the Theme Song >From Bonanza,” San Diego Union Tribune 06 Sep.1996:B-3:1; B-4:2,3,4,5.
[26] L. Erik Bratt,.”Officials Want 2nd Look at Daley Ranch deal,” San Diego Union Tribune 11 Dec. 1996:B-1.
[27] Portillo, Ernest. and Logan Jenkins, “Purchase of Daley Ranch Approved,” San Diego Union Tribune 04 Jan. 1997: B-2:5,7; B- 1:2; B-6:4; B-10:6.
[28] Bratt, Erik, ”Land Deal Back on Escondido Agenda:reconsiderations Asked For Daley Ranch Plan,” San Diego Union Tribune 18 Dec. 1996: B-10.
[29] Escondido City Council Minutes of 23 Oct.1996.
[30] Ibid.
      Written by: Dan McGrath