Fry’s golf in rough

Jonas Blixt won the 2012 Open on hole 18 at CordeValle.

The Moors of the sixth century who started the Spanish Alhambra castle didn’t have to contend with PG&E pipelines and utility company oversight, but construction still lasted more than 100 years.

Developers of a modern-day replica of parts of the castle in southeast Morgan Hill, which will serve as the American Institute of Mathematics’ headquarters and the future clubhouse for the Open, continue to see their construction timeline drift further toward that limit – most recently because of an ongoing PG&E review with no end in sight of the commingling of its facilities with the sprawling four-story structure.

The current “impasse,” which follows several others on the property since 1998, started about a year ago and has already derailed plans to move the PGA’s 2014 Open to the 7,360-yard Institute Golf Course, which sits on a 192-acre parcel owned by electronics retail magnate and AIM co-founder John Fry on Foothill Avenue, according to Fry’s Electronics and spokesman Manuel Valerio.

Tournament organizers now don’t know where the October 2014 golf event will be, nor when they will be able to move the tournament to The Institute, which is not open to the public.

Fry, with City permits in hand, thought he was ready to start construction until about a year ago, when PG&E stepped into the fray. As late as October 2012, crews were ready to start pouring concrete for the 170,000-square-foot castle’s sprawling foundation, according to AIM Executive Director Brian Conrey. There is even a hole in the ground where the foundation is proposed to be poured.

But PG&E didn’t allow the work to proceed because it was still reviewing the project.

At issue is a 34-inch gas transmission line owned by PG&E that runs roughly north-to-south through the entire rectangular property, but it is not underneath any building plans.

The City of Morgan Hill wanted to include the utility company in discussions about ensuring the safety of the pipeline during and after construction of the AIM headquarters. That was after Fry paid the City more than $300,000 in permit fees, and at least $50,000 on geotechnical consultants to determine that the property – the site of a former landslide – was seismically stable and could support the massive building.

The City approved the project in late 2010, but the developer still hasn’t heard anything of substance from PG&E, according to Valerio. The developer is “extremely frustrated” about the utility company’s unexplained delay, especially since a series of studies – conducted by the City, Fry and an independent party in 2009 and 2010 – has already determined the site is geologically safe.

“This has caused a great deal of frustration and consternation on the part of the developer and, I can only imagine, on the part of (AIM), the future tenants of that world-class facility,” Valerio said. “This has gone on for a number of years, from the very beginning of the project. PG&E has gotten all the information we have because of their easement with the pipeline, and we’ve kept them fully informed. But they don’t budge.”

Plus, Fry has gone “above and beyond” geologists’ recommendations by pouring a steel-and-concrete “retaining wall” along the northern side of the castle footprint, to provide additional support and protection to the nearby pipeline, Valerio said.

PG&E staff are loathe to give up a lot of details about their concerns with Fry’s plans out of respect for customers’ privacy, PG&E spokesman Jeff Smith said. He was also unable to give an estimate of when PG&E might sign off on the project, or a specific reason as to why it has already taken the better part of a year.

“We have been working with the City and the developer to ensure any structure will be built to the proper safety specifications,” Smith said.

The pipeline in question is buried three to six feet underground through the property, Smith said. It was built in the 1950s through “ancient landslides” in the area of the golf course and construction site. “There is currently no active landslide crossing the gas pipeline at this site,” Smith said.

PG&E owns two pipelines that cross through Fry’s property. The other is smaller and runs roughly parallel to the 34-inch transmission line, farther uphill (east) and away from the AIM construction site, according to Morgan Hill Assistant City Manager Leslie Little.

The larger pipeline closer to the castle site is on an easement owned by PG&E about 30 feet uphill from the edge of the proposed building, Smith said.

City staff always consider the impact of things like pipelines when reviewing any construction plans, and Fry’s proposal was no different, Little said. Still, the City wanted to keep PG&E in the loop after giving the project its blessing.

“We involve other utilities all the time when we’re close to their property,” Little said.

She added that PG&E has suggested it has some concerns about some of the previous geotechnical examinations of the property.

Smith and Little both said there has been ongoing dialogue back and forth between PG&E and the developer.

Smith noted that PG&E’s authority to review the project stems from its ownership of the pipeline and a narrow easement of property through which it passes. The company is thus permitted to ensure it has access to the facilities.

“If there was a building that prevents us from being able to maintain the line, that’s not in the interest of public safety,” Smith said.

The first time Fry’s property was under intense scrutiny of local regulations was in 1998, when he began redesigning the golf course without seeking permits from the City. The resulting dispute was eventually resolved. Then the question over the geologic stability came up, and was ostensibly resolved in 2010.

Valerio added he hopes the 2014 Open will remain “somewhere in our backyard,” but it remains undetermined where that might be.

“I’m sure discussions are ongoing with CordeValle,” Valerio said. “We’ve had a great partnership.”

Morgan Hill Mayor Steve Tate, who has volunteered with his wife at the Open at CordeValle, said even if the tournament moves outside South County for 2014, it would be fine if it came back the next year.

The City is “working hard in many ways,” including communicating with PG&E, to ensure the PGA event stays in the area after 2013.

Beyond the Open, the grandiosity of the massive castle and the presence of AIM – a nonprofit think tank currently based in Palo Alto – will bring an eternal prestige to South County by attracting world-renowned mathematicians, students and visitors.

“We’ve invested our time, money and our good name in trying to do something positive for the community. We want to do it right,” Valerio said. “We’re just frustrated this is literally where we sit, with a hole in the ground, because another private entity is not getting off the fence and saying, ‘we have no qualms with this.’”