May 7, 2006 - ENCINITAS ---- Construction of a luxury condominium-hotel on an Encinitas bluff will begin in 2007 despite a $220,000 fee, an order never to build sea walls, and other restrictions proposed by the state Coastal Commission, a resort spokesman said last week.

Doug Yavanian of KSL Encinitas Resort Co. said that company officials are scrutinizing the demands contained in a report headed to the commission for a vote Wednesday.

"There's nothing overly surprising," Yavanian said. "A lot of these new wrinkles, we're looking at them. We're excited about moving this project forward."

Progress on the planned, 130-room resort has been sluggish at best.

In 1992, the Coastal Commission first approved plans for a hotel on 4.1-acres west of North Coast Highway 101 and La Costa Avenue. Included in the approval were plans for a restaurant, retail shop, meeting rooms, banquet facilities and a pool with cabanas.

Since then, one resort operator, Sports Shinko Co., came and went for lack of capital. KSL ---- which acquired the site as well as La Costa Resort and Spa in 2001 from Sports Shinko ---- also has failed to secure financing to build the resort atop the bluff.

That's why the company has proposed selling 100 of the 130 hotel units as so-called "limited occupancy condominiums," where buyers would agree to stay in their rooms for no more than 90 days a year.

The commission in March approved the condo-hotel proposal, as well as an offer from KSL to place sand from the resort site on the beach. The proposed restrictions pending before the panel stem from action at the March meeting.

"(KSL) actually has a permit today to build a hotel, but in order to convert it to condominiums and acquire the financing for construction, there are a lot of other conditions to comply with," said Gary Cannon, a planner in the commission's San Diego office.

The 12-member Coastal Commission oversees development and ensures public access along the state's 1,100-mile coastline; members will vote on the new conditions when it meets Wednesday in Costa Mesa.

Most address the private ownership of the 100 hotel units.

First and foremost, all privately owned rooms would be rented to the public whenever the owners aren't occupying them. KSL officials have said earlier that they expected rates would range from $400 to $600 a night.

The commission will consider setting a 90-day annual occupancy limit for the condos, with maximum stays of 25 days every 50 days. The cap would be firm, regardless of how many individuals own the unit.

Whenever it is not occupied by its owner, it must be made available to the public at the same rate as any comparable room at the complex.

No portion of the hotel would be eligible for conversion to a full-time condominium or apartment.

Because the public's access to the privately owned rooms would be limited, the commission will consider ordering KSL to pay a $220,490 fee to a public or nonprofit agency to build low-cost lodgings or buy land for such facilities in Encinitas or Carlsbad.

The so-called mitigation fee is intended to offer compensation for the privatization of property zoned to serve visitors.

"That is not a project-buster," Yavanian said of the fee.

An opponent of the condo plan, however, scoffed at the fee amount.

"I'm sure it just about covers the cost of a single Porta Potty and a year's worth of the cost of emptying it," said Mark Massara, a coastal advocate for the Sierra Club.

Massara, who testified against the project before the Coastal Commission in March, said converting hotel rooms into condominiums deprives visitors of coastal lodgings. The hotel operators dispute that claim.

Still other requirements would regulate KSL's proposal to place 50,000 cubic yards of sand dug from the hotel site onto the beach below the property.

The excavation would be allowed only between Sept. 15 and Feb. 15, with no digging permitted on weekends or holidays.

The beach would be off-limits for storing equipment and materials, and washing equipment on the beach or state parking lot would be prohibited.

Hauling sand from the hotel site is expected to last two months, with 35-ton dump trucks making 5,000 trips across the state parking lot. Bulldozers and paddle-wheel scrapers would dig and spread the material.

These conditions would add to others the commission set years ago with its approval of the hotel plans.

To ensure that the resort would not obstruct people from reaching the beach, the public would be allowed to cross the grounds and use a stairway connecting the beach to the bluff top.

KSL already has built that stairway, and beachgoers today can climb it to the vacant site that affords sweeping views of the ocean, coastline and Batiquitos Lagoon.

A bluff viewpoint ---- and the planned store, restaurant and banquet rooms ---- would be accessible to the public.

So would the hotel's three-level, 320-space underground parking garage, at prices not to exceed those of the neighboring lot at South Carlsbad State Beach.

The commission has ordered that all structures remain at least 55 feet away from the edge of the bluff.

Yavanian seemed unconcerned that the commission has ordered the developer never to build a sea wall or any other device to armor the fragile bluff, even if waves, erosion or landslides were to threaten the resort.

The order includes a requirement that the hotel owner remove any building deemed uninhabitable because of such threats. And if any portion of the resort were to tumble onto the beach, the hotel owner would be required to remove it.

To worry about that kind of requirement would be to live in "a paranoid world," Yavanian said.

Until KSL secures all of its approvals, the company cannot begin to sell the planned condominiums, Yavanian said. Newspaper stories have led to inquiries about the project, he said, and 50 prospective buyers have their names on a waiting list.

He would not say what the units, or the resort itself, are expected to cost.

Construction would last about 14 months, he said.

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