On Tuesday, Oct. 11, the Great Park Board of Directors, by way of the Irvine City Council, voted to approve hundreds of millions of dollars in future Great Park development funds. The park’s recently approved framework, adopted in July, will bring many new features, including a $130 million amphitheater and a 75-acre botanical garden.

In a 4-1 vote, Irvine leaders opted to break away from the current agreement with FivePoint Holdings, the area’s most prominent developer, which has limited the city’s control over the park’s development for years.

Now, in an effort to gain the necessary funding and developmental control over the Great Park,  the city will reconfigure an existing agreement with Heritage Fields, a 4,700-acre master-planned community built on reused portions of the MASC El Toro, inside the Great Park.

In terms of an amount, a staff report associated with the framework indicated that Irvine’s Great Park Community Facilities District (Great Park CFD) and Heritage Fields are set to receive $1.2 billion through 2030. The amount will be split between the Heritage Fields and the Great Park CFD. 

In a phone call with Irvine Weekly, Irvine City Manager Oliver Chi explained that Heritage Fields still has approximately 3,500 of 10,500 units left to build within its master plan, but there is no estimated time of completion.

The CFD amount is “based on current bond market conditions, the city’s planned development patterns, and the fiscal environment contemplated,” within the next seven years, according to the staff report.  

“The city will have access to – in that same [seven-year] period – $625 million, and when you package that with the money that we have on hand, we’ll have close to $1 billion for use of building out the Great Park Framework,” Chi explained.   

Dozens of residents, however, along with Irvine Council member Larry Agran, opposed the proposed plan, arguing that the city was moving too quickly to earmark development funding for a project of this magnitude. 

Former Irvine Mayor Christina Shea spoke during public comment, adding that she felt more time was needed for the community to review the information associated with the implementation plan. 

Shea also emphasized that the current status of FivePoint’s finances are worrisome, considering the company’s plummeting stock price.  

“This is a $1.3 billion rework of a plan that took months, and months and months to negotiate. Our partner FivePoint, LLC is facing serious financial downturn as the stock market indicates their holdings are dropping daily – they’re on the verge of bankruptcy,” Shea said. “Staff indicated to me that all of you knew this.” 

As of Thursday, Oct. 18, FivePoint’s stock was trading at $2.32 per-share, up slightly from its 52-week low of $2.14 per share.

Irvine City Manager Oliver Chi said in the current agreement, all of the CFD funding is directed to FivePoint, and any additional funding can be used by the city for operations and maintenance. Chi also added that the city cannot currently use CFD funds for capital improvements.  

“Ultimately the primary question is: Does the city want to be in control of the development of the Great Park moving ahead or do we want to continue to allow FivePoint to develop the park and allow FivePoint to control the CFD dollars that are being paid?” he said. “The framework implementation agreement doesn’t create any new money, it doesn’t provide FivePoint $600 million, it doesn’t create any new revenues. What it attempts to do is reconfigure the existing agreement we have in place.”

Chi also reiterated that in this restructuring of the Great Park Implementation Plan, Heritage Fields would not automatically receive funds, but rather have resources to apply for reimbursements for the infrastructure projects – roads, sewers – it completes.

“If this agreement is approved, we don’t write Heritage Fields a check for $600 million tomorrow. What it creates is a new process through which Heritage Fields – when they complete infrastructure can apply for reimbursement,” Chi explained. “Simultaneously, with the additional monies that are available, [it will] hopefully make the Great Park a reality, after 20 years of struggle.”  

Leaders in Irvine have voiced their intention of bringing the “park into the Great Park” for months. In terms of the previous discussion on the Framework implementation agreement, Chi added that the Irvine City Council has been working on these agreements for months in closed session. 

The Great Park CFD is a state-authorized public infrastructure financing mechanism. Specifically, the CFD generates funds through property taxes within the scope of the Great Park and is known as the Mello Roos tax. 

“The tax rate is a fixed dollar amount when you first purchase the home – it’s a dollar amount based on the type of property you own,” Chi explained. “All of that amount is collected as part of your property tax bill – it’s remitted to the city, and the city holds that money. The money can be used in one of two ways. Reimburse against approved projects that fit with the state definition of what CFD dollars can be used for. Or you can keep that money to secure and issue bonds.” 

Despite partaking in those meetings, Agran spoke in opposition to the new agreement. From his perspective, the city is not being transparent enough in its efforts to present these new developments to the public. 

“For the record – outside of the closed sessions – I’ve received no briefing, zero,” he said. “This meeting I regard as a pretty good study session – what’s gone on, where are we now, and the direction we might be proceeding in. For me, making any definitive vote just seems to be kind of outrageous.” 

Contradictory to Agran’s remarks, Director Tammy Kim said she was given regular updates regarding the new implementation agreement.   

“We have had thorough and robust conversations on this in closed session. We provided very specific instructions to staff on this very topic. I can only speak for myself, I’ve received weekly briefings on this,” she said. “So, to come here to question the process I feel is not fair and not accurate.”

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