The Pool is a simple outdoor pool with basic concrete dressing rooms – not a water park – or one with upscale amenities. The reason it is so cherished by the Community is because it gives to the Community the most important things in life – the things that money can’t buy – health, vitality, love, joy, and genuine connection with others. The Pool was not only part of the Community – it created community. It was a place that nourished the hearts, minds, bodies and souls of the people who went there. Generations of children learned to swim there; school swim teams practiced and competed there; people of all backgrounds found camaraderie there; lifetime friendships were formed there; health, fitness and character building habits were taught there; and senior citizens and the disabled found healing, strength, and support to deal with debilitating injuries and chronic pain. Moreover, for the disabled, it was the only facility that made it possible for them to enjoy the Park.
No other pool in the area provides that – none has replaced it – and none scheduled for the future is designed for that either. Those who relied on the pool for pain relief and health continue to suffer because of this.
The Santa Monica Mountains Conservancy (SMMC) bought the Pool from the Presbyterians in 1994. At the time it bought the pool, the SMMC needed the support of the Palisades Community to secure release of Proposition A funds for the acquisition. Many in the Community were concerned about the future of the pool if the SMMC were to buy the land from the Synod. The SMMC assured the Community that they should not worry about the pool, that it would remain open, and touted the recreational opportunities that their stewardship of the Park would bring for children.
As a condition of acquiring the land, the SMMC agreed to honor the terms of the YMCA’s long-standing lease of the Pool. The YMCA had a lease for the useful life of the pool, and when the useful life was over, the SMMC was required to enter into good faith negotiations “for the possible replacement of said pool on such reasonable conditions as can be agreed to at such time for the continued use and/or management of the facility by the YMCA.” Thus, the lease reflected the obligation of the SMMC not only to honor the lease for the full useful life of the pool, but to enter good faith negotiations with the YMCA for the continued use of that small part of the park as a pool. In addition, Proposition A requires that property acquired with Prop A funds, such as the Pool, must be “maintained and operated in perpetuity” for the benefit of the citizens. (Prop. A, § 16(a)(1)).
The lease required the YMCA to pay $ 1 rent per year, plus all expenses of operating the pool, including assuming all liability arising out of operating the pool. Those expenses amounted to several hundred thousand dollars a year. The YMCA has indicated that it never made a profit on the pool. It was run for the Community and subsidized by other YMCA activities.
In October 2007, the YMCA exercised a c. 35 year old option it had had to acquire 4 acres of property near the entrance to the Park, adjacent to where the pool is located.
A month later, in late November 2007, a lawyer for the Conservancy contacted the Director of the Palisades-Malibu YMCA, to tell her that the YMCA pool lease had expired when the YMCA’s exercised its option to buy the 4 acres, and that a new lease was required. Not sure if the SMMC was correct, the YMCA nonetheless invited the SMMC to submit a new proposed lease. The SMMC indicated that it would submit a new lease to the YMCA sometime after the holidays.
In the meantime, in Feb. 2008, the pool was closed for repairs. It was believed that the repairs would cost $ 25,000, but later, it became clear that the repairs needed were more extensive, and would cost c. $ 350,000 - $ 400,000. (Major plumbing repairs on a multi-million dollar asset after 50 years are not unusual.)
The YMCA believed that the SMMC, as landowner and landlord, had the legal responsibility to cover the cost of such capital repairs. The SMMC wanted the YMCA to cover the cost of the repairs.
On March 12, 2008, the SMMC sent the YMCA a proposed new lease. The new terms offered by the SMMC were:
- 5-year lease, renewable only with the agreement of both parties.
- The SMMC wanted the YMCA to take on not just liability for injuries arising from operation of the pool, but total “venue liability”. In other words, if land would shift or other things beyond the control of the YMCA, the YMCA would have total liability for the property.
- The YMCA would also have to lay out the $ 400,000 needed for capital repairs and improvements.
The YMCA was willing to consider taking on the cost of the repairs and total venue liability for a long-term ground lease, but not a short term lease.
The YMCA commissioned a study by the engineering firm Grover-Hollingsworth & Associates, to investigate the condition of the pool and surrounding soil before taking on such expense and liability. On June 3, 2008, Grover-Hollingsworth issued its report, which found that the ground under and around the pool was very stable, and that the pool, while it needed repair, had another 10-20 years of useful life.
Two weeks later, on June 18, 2008, the YMCA submitted to the SMMC proposed terms for negotiation of a long-term ground lease (55 years plus 2 options to renew for 20 years each). Under this proposal, the YMCA would continue, as before, to have a lease for $ 1 per year, plus operating expenses for the pool and pool site (c. $ 400,000 per year). The YMCA also agreed to take on full cost and responsibility to rebuild and renovate the pool ($ 400,000), and to take on responsibility for both general commercial liabilitiy and property insurance.
Less than a week later, on June 23, 2008, the Executive Director of the SMMC rejected negotiations based on the proposal, taking the position that the useful life of the pool, and thus the YMCA’s original lease was over, and that negotiation of a long term lease would require a long, complicated process of studies and approvals, all at the cost of the YMCA. (Notably, months later, the Executive Director of the SMMC stated that the YMCA was foolish not to have realized that its lease was not over.)
As a result, on July 29, 2008, the YMCA sent the SMMC a letter saying that as “all prior agreements between the parties in connection with the Pool site have expired” [the position taken by the SMMC] . . . the YMCA has terminated its operations therefrom. (The pool had been closed and the YMCA had not been able to operate the pool for 4 months by this time.) The YMCA indicated that it was interested in pursuing a future relationship with the SMMC, but unless a lease arrangement were agreed upon, it was unable to occupy the site.
Due to this impasse, the Friends of Temescal Pool (a non-profit 501(c)(3) organization) was formed at the end of August 2008, to represent the interests of citizens. Friends has now grown to over 2000 people – and that support continues to grow.
Since its inception, the Friends have been working with the SMMC, the YMCA and other interested parties to find a way to repair the Pool in Temescal Gateway Park and return it to the service of the Community. Although the law imposes an obligation on the SMMC to operate and maintain the pool, the Friends preferred a negotiated, positive solution to the problem. The Friends have sought and will continue to seek a solution that will benefit the people, the Park and the Conservancy.
The YMCA indicated that it needed a minimum 10 year lease, given the cost of needed repairs, whereas the SMMC was insisted on a 5-year non-extendable lease. In addition, the SMMC wanted any pool lessee to take on full liability for the venue, provide or pay for the $ 400,000 in capital repairs, and contribute $ 75,000 a year to at risk youth camping programs in the park.
The YMCA spends millions of dollars a year on at-risk youth programs, and offered to partner with the SMMC, but because the pool operated at a loss, an additional $ 75,000 cost related to the pool was not feasible.
Such unrealistic financial terms would have been unrealistic for any lessee.
On December, 2, 2008, the SMMC, contrary to the recommendation of its staff, refused to allow its Executive Director to even solicit bids for a 5 year lease on the pool. In addition, it authorized its Executive Director to get a permit from the California Coastal Commission (CCC) to fill in the pool. This SMMC vote to fill the pool in with the understanding that the pool could be filled in in such a way that it would not damage the pool, and could be reversed when the pool was leased. The reason given for filling in the pool were alleged concerns about safety and liability. The facts presented to the SMMC Board in making its decision were incomplete and inaccurate, but no testimony rebutting the testimony of the SMMC-retained engineer was allowed at the hearing. In fact, other independent experts indicated that 2 small holes at the deep end of the pool were sufficient for drainage; that filling in the pool was not necessary; and that doing so would render it “effectively worthless.” In addition, the present high fence around the pool was sufficient for safety.
During the ensuing month (Dec/Jan), the Friends continued to work to find win-win solutions to save the pool. Among other things, the Friends were developing business plans with options for the SMMC to use other operators for the pool, and generate revenue for the SMMC. The Executive Director of the SMMC told the Friends that he was willing to consider such a business plan, and had given public indications of willingness to continue to find a solution to repair and reopen the pool. Moreover, the CCC did not list an application by the SMMC to fill in the pool on the agenda for its January meeting, and told the Friends that the pool waiver application would not be before the CCC at its January meeting.
However, on the night of Tuesday, Jan. 6, 2009, the Friends learned that the CCC was in fact going to rule the next day on an application to fill in (i.e., destroy) the pool, that had been filed quietly on behalf of the SMMC a month earlier, on Dec. 8, 2008.
On Wed., Jan. 7, 2009, in response to an objection filed by the Friends, the CCC decided that it would not rule on the SMMC’s application to fill in the pool at Temescal Gateway Park, because the CCC had failed to notify interested parties, in violation of their own regulations. Despite this, the CCC turned around the same day and secretly gave the SMMC the go-ahead to fill in the pool anyway, by giving them an oral “Emergency” permit.
The next day, Thursday, Jan. 8, 2009, demolition equipment and trucks surreptitiously rolled into Temescal Gateway Park at 7 am, to cut an 8ft x 8 ft hole in the pool’s concrete shell and “temporarily” fill in the pool. Community citizens and leaders found out from people hiking in the park later that morning, and were outraged. The written Emergency Permit by the CCC had not even been issued yet.
The next morning, Friday, Jan. 9, 2009 the Friends of Temescal Pool filed suit against the SMMC in LA Superior Court to nullify illegal actions that the SMMC had taken, and require the SMMC to fulfill their statutory obligation to “maintain and operate” the pool. Specifically, the Friends ask the Court to (1) nullify acts previously taken by the SMMC which exceeded their legal authority, (2) require the SMMC to repair and re-open the pool, in accordance with their legal obligation to “operate and maintain property in perpetuity” that they obtained with Proposition A funds, and (3) make the park fully and equally accessible to persons with disabilities as required by the California Disabilities Act and the Americans with Disabilities. The complaint further asks for damages, attorneys’ fees and the costs of the law suit.
At the initial hearing on the lawsuit, counsel for the Friends, Mark Holscher of Kirkland & Ellis LLP, informed the SMMC that, in light of the SMMC’s actions to fill in the pool, the Friends would hold the SMMC responsible for any damages to the pool, and would seek to have the SMMC put in a new pool in the park, if the SMMC’s actions made repair and reopening of this $ 4 million Community asset unworkable.