Seventh District Councilmember Tonia Reyes Uranga cast the lone dissenting vote Tuesday night in the Long Beach City Council’s 7-1 decision (First District Councilmember Robert Garcia was inexplicably out of the room) to lop $3,000 a month off the rent it charges BANCAP Investment Group to lease a swath of Long Beach Marina-front property. Locals may better know the area as the location of the popular restaurant, Schooner Or Later.

BANCAP requested the reduction in the midst of a 25-year lease because one of its subtenants—the Seal Beach Yacht Club—has apparently hit on hard times due to declining membership and says it needs a $3,000 reduction in its monthly rent to stave off bankruptcy.

“I just want to be clear: the reason we’re helping them out is because of 40 percent loss of membership in a social club?” Reyes Uranga asked. “Why isn’t this just a negotiation between BANCAP and the [Seal Beach] Yacht Club? This is a sublease to BANCAP and not a lease with the city.”

In an April 19 letter to the City Council obtained by Redistricted!, former Long Beach Deputy City Attorney Jim McCabe—who used to supervise the city’s lease with BANCAP—said he was troubled by the same thing.

“In the good years, BANCAP got the benefit of rising subtenant rents. It obviously did not offer to share these increased rents with the taxpayers,” McCabe wrote. “Now times are tough. It wants the taxpayers to pay for the decreased rents it is getting from one of its sub-tenants.  BANCAP was willing to take the risk of fluctuating sub-lease rents when times were good. Now it wants the taxpayers to foot the bill when we have been in a recession.”

McCabe went on to suggest that the city’s willingness to grant a rent reduction was based on the fact that BANCAP’s founding principals are Stephen T. Conley and John W. Hancock, who are wealthy and well-connected social and political insiders.

McCabe also criticized the timing of the vote. It was originally scheduled for Feb. 16, when Councilmember Gary DeLong—in whose Third District the property is located—was campaigning for re-election. Conley was a co-chair of DeLong’s re-election committee and Hancock was on the campaign’s advisory council. McCabe noted that the vote reappeared on the council agenda one week after DeLong was re-elected.

“This is just plain cronyism,” McCabe charged in his letter.

Back at Tuesday night’s council meeting, City Manager Pat West responded to Reyes Uranga’s questions about the city’s intervention in the Seal Beach Yacht Club-BANCAP lease by turning to the Long Beach’s property service manager Victor Grgas—fun fact: a former mayor of Seal Beach.

Grgas recited background information that had been previously shared with council members but was not attached to the agenda item available to the public. He detailed a recent sharp decline in Seal Beach Yacht Club membership, suggested that the club might close if it didn’t receive a $3,000 reduction in its monthly rent—and said that the closure of the club would cost the city $110,000 more than the cost of reducing the rent to BANCAP.

However, Grgas did not explain why the city ought to take the $3,000 monthly hit rather than BANCAP. Nobody did. Reyes Uranga was alone in publicly considering other consequences.

“We are setting a precedent in terms of doing this,” Reyes Uranga warned. “Will this open the doors to other people requesting the same [treatment]?”

Grgas indicated that would not be a problem, although he based his prediction on the narrowest definition of what the council was considering.

“There is no other marina-related use that asking for this kind of relief,” he said. “This represents a special circumstance.”

  1. Dwight K Snider
    April 21, 2010 at 10:30 am

    Correct me if I am wrong! It is a safe bet to assume that BANCAP, Mr. Conley, Mr. Hancock, their employees and immediate family members will contribute substantial amounts of money to the future election campaigns and post-election campaign debt retirement fundraisers of Mr. Garcia and the seven city council members who voted yes Tuesday night in favor of the future financial interest of BANCAP.

    • April 21, 2010 at 4:43 pm

      Robert Garcia did not vote yes–he did not vote at all, leaving the council chamber without explanation just before the item was heard.

  2. Joe Weinstein
    April 21, 2010 at 2:56 pm

    Key statement: “However, Grgas did not explain why the city ought to take the $3,000 monthly hit rather than BANCAP. NOBODY DID [my emphasis]. Reyes Uranga was alone in publicly considering other consequences.”

    Yes, if the sky is falling on a City-Hall favored insider, it’s only OBVIOUS, no explanation/excuse/apology ever required, that all LB taxpayers must take the hit.

    Ironic that the only public objection came from someone who on another recent occasion notoriously referred to the city’s must-protect ‘family’ as again – OBVIOUSLY – comprising not all taxpayers but rather City Hall and its employees.

  3. wrongbeachjohn
    April 21, 2010 at 3:12 pm

    Fly specks in pepper compared to the amazing sweetheart deal at the wrong beach yacht club which the real guys infest.

    • April 21, 2010 at 5:30 pm

      I was totally going to say that myself WBJ!

      • wrongbeachjohn
        April 23, 2010 at 11:11 am

        Proves that highly intelligent informed contributors think alike. I’d offer to extend a Black and Tan your way but I don’t want to get between you and the greet.

  4. For a better Long Beach
    April 22, 2010 at 8:57 am

    Where do I go about getting my rent reduced $3000 per month due to hard times?

    Suja isn’t returning my call – curious…

  5. The Toad
    April 22, 2010 at 9:27 am

    Another typical “Long Beach goldmine partnership”: The well-connected get the gold and the tax-payers get the shaft!

    • April 22, 2010 at 11:02 am

      Hey Mr. Toad! Welcome back to the wild ride!

  6. question
    April 22, 2010 at 10:38 am

    question: Are those opposed to this action suggesting the Council should have just said no, and lost the much greater amount of revenue when SBYC left?

    • Commentor
      April 22, 2010 at 12:24 pm

      Yes, that is exactly what I support. The real estate market sets the price for issues such as this. The city should not be subsidizing real estate market prices with my tax dollars, especially for a bunch of rich guys who happen to be Councilman DeLong’s buddies, contributors and campaign advisors. Hasn’t the general public’s real estate values suffered enough at the hands of the banking community without City Council jumping in also to reward the rich?

      Let SBYC go under if it must. How many foreclosure families do you think really care about an elitist yacht social club in Seal Beach not being able to pay their bills. If Conley and Hancock make a few less million $ this year, I’m willing to bet those same foreclosure families wouldn’t miss a wink of sleep.

      What I would really like to know is how nearby Joe’s Crab Shack was able to secure a $1 per year lease from Bancap for 10 years, and then got it renewed for another ten years this past year for the same rate of $1 per year?

      • April 22, 2010 at 4:11 pm

        I’d like to point out that home owners who are truly facing foreclosure do have the opportunity to apply for TARP funds.

        • Commentor
          April 23, 2010 at 2:58 pm

          Have you actually looked into applying for TARP funds, or are you just another flag-waving idealist who believes the government is here to save everyone from badness.

          I recently went through a foreclosure proceeding and filed all of the necessary TARP application papers. In case you didn’t know, ALL foreclosure families who seek any kind of assistance from their bank are first made to apply for TARP funds. It isn’t a choice. The banks don’t want to consider helping the foreclosure families until after the foreclosure families have received maximum assistance from the government’s TARP.

          Needless to say, WHAT A WASTE OF TIME. There are no funds as you incorrectly state. All TARP offers to foreclosure families is to extend the loan term or adjust their interest rate, all of which doesn’t mean a hill of beans for family wage earners who are $200,000 underwater on a mortgage they can’t afford. Maybe next time you should consider looking into a subject before spouting off like you know what you are talking about.

  7. we_deserve_better
    April 22, 2010 at 1:49 pm

    I wonder if the yacht club might be “successful” if it was a bit less elitist? I bet there are lots of families who might join a club where they and their kids could take sailing lessons and sail together– for a nominal sum. If the City is “giving away” deals, there MUST be a public benefit– and I doubt that the “prestige” of having the yacht club is worth it. If there is no benefit, they should be charged market rate, adjusted appropriately per whatever measure the parties agree on. Period.

  8. Will Cullen
    April 22, 2010 at 2:37 pm

    Hey Dave, I’d be interested in knowing how Uranga’s opponent, James Johnson would have voted and if he has recieved any money from Conley, Hancock, or BANCAP? James.. if you read this let us know if you would have voted yes, no, or just opt for a potty break?

  9. D. Jones
    April 22, 2010 at 7:22 pm

    Can the City pay my mortgage too? So, we’re now subsidizing yacht clubs with our tax dollars??

  10. Ibencruzin
    April 23, 2010 at 7:46 am

    Wow, I want to sign up for that program hand me down. A couple of grand reduction on my mortgage well I bet I could build a dock from my house to the cement pond they call the LA River. Maybe the North Long Beach Yacht Club should be established for this type of slush over the next 25 years. Where do we sign up when we can’t get more police or our potholes filled? Since the market sets the rates why are we interceding? SBYC is not serving very many Long Beach citizens and even though a 3k stipend is not much it is too much when it looks like a gifting taxpayer dollars just to save a lease. I guess we all need to be in line for the rest of gimmes.

  11. oscarwildefan
    June 7, 2010 at 6:42 am

    Hmm, it passes 8 to 1. So, Tonia’s vote had absolutely no effect whatsoever!

    It doesn’t show independence, rather a lack of persuasion as per her colleagues.

    Perhaps it was done with a wink and a nod. Senora Uranga only has one more day to appeal to the common man.

    Maybe it’s jealousy she’s not been invited to join the Yacht club. The blue-bloods need some persons of color to fulfill diversity statutes.


  12. June 11, 2013 at 8:14 pm

    If the rental income exceeds the mortgage payment, then the landlord will
    have positive cash flow. This can really stress out employees and make it
    so they want to work for someone who has $25 application fees and not get screamed at everyday.
    But follow that up with “but careful it’s full of legalese, however we can help decipher it for you”.

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