Headlands Project Limits to Be Defined

The City Council has told its staff to draw up a plan outlining what development would be allowed on the environmentally sensitive Dana Point Headlands after receiving a warning letter from the landowners’ attorney this week.

The 120-acre property on the bluffs near Dana Point Harbor is among the last large undeveloped coastal parcels in Southern California and is home to the Pacific pocket mouse, which is on the federal endangered species list, and the threatened California gnatcatcher.

Courts have upheld two 1994 voter referendums blocking a plan for a 400-room hotel, a commercial center and up to 370 homes at the site. Last month, the state Supreme Court refused to hear an appeal by the landowners. However, the courts also affirmed the owners’ rights to use the land, holding that the city had to either allow some development or compensate the landowners.

The property is owned by M.H. Sherman Co. and Chandis Securities Co., a firm that oversees the financial holdings of the Chandler family, a major stockholder in Times Mirror Co., which publishes the Los Angeles Times.

A letter received Tuesday from the Irvine law firm of Hewitt & McGuire charged that the city’s delay in drawing up a specific zoning plan for the Headlands constituted an illegal taking of the property without compensation for the landowner.

At this week’s council meeting, City Atty. Michele Vadon insisted, “We are moving forward in a reasonable manner as quickly as we can.”

The council voted 4 to 0 to have its staff amend the city’s General Plan--the comprehensive blueprint for development in Dana Point--and draw up a specific zoning plan for the property. It also approved hiring a contract planner to work solely on the Headlands zoning plan. No price was set.

Councilwoman Toni Gallagher abstained because she lives next to the Headlands.