A seemingly unheard-of man has offered to buy Gilroy Gardens and
all or part of the 536 acres it sits on, according to City
Administrator Tom Haglund. A cost-conscious city council will
consider the vague pitch Monday.
As city officials begin assembling a community group to help the council plan the future of Gilroy Gardens, a seemingly unheard-of man has offered to buy the park and all or part of the 536 acres it sits on, according to City Administrator Tom Haglund.
The council will hold a closed session Monday evening to consider Michael Russell’s offer, but exactly who the man is, what he wants and who he represents remains unclear to council members, Haglund said Wednesday a few hours after the city clerk released the council’s Oct. 6 agenda.
“I haven’t had a chance to talk with the council about this proposal for the potential sale of the Gardens,” Haglund said in a voicemail Wednesday. “They don’t know the particulars of the situation.”
Haglund did not return subsequent messages later that afternoon, so the particulars remain fuzzy. Several developers and council members said, though, that they did not recognize Russell’s name, and nobody by that name works at Shappel Industries, the Milpitas-based developer that built Eagle Ridge.
That subdivision is a key player because part of the gated community borders an expansive – and vastly under-used – Gilroy Gardens parking lot that serves the park’s administrative staff. Councilman Perry Woodward suggested Sept. 15 that the city could sell the roughly 10 acre patch of asphalt to Eagle Ridge to raise revenue for sidewalk repair and also to help narrow the city’s $3.9 million deficit. In 2005, Shappel Industries actually bought 33 acres of residentially zoned land from the park, helping the Gardens reduce its financial obligations from about $70 million to about $13 million. A debt restructuring plan the city developed with the park also improved its balance sheet.
While Russell’s proposal may dwarf the 33-acre deal or Woodward’s parking lot thought, Woodward said he suspected Russell pitched his plan after hearing Woodward’s idea last month. Russell’s vague offer is the second one the city has received since buying the 536 acres of land earlier this year from the park’s former bondholders at a heavily discounted price of $13.2 million.
Parc Management, a Florida-based theme park company, will soon meet with a sub-committee of the city council – which includes Woodward and Councilmen Dion Bracco and Bob Dillon – and the Gilroy Gardens Board of Directors to discuss the possibility of adding a water park for children to Michael Bonfante’s struggling horticultural dream. The company, or any other park operator, would not enter into a contract with the city, but with the nonprofit board, which governs the park that sits on city property. The board’s contract with its current operator, Cedar Fair, expires in February 2009.
Council members hope to have a community-based task force assembled by then to help the body plan the lush area’s future. In the meantime – aside from the possibility of selling 10 or 20 acres to developers – Dillon has suggested refurbishing the swimming pool and picnic area, and Councilman Craig Gartman has mentioned improving the ballfield or gymnasium, maybe putting an amphitheater out there or leasing some of the land for agricultural uses.
No matters what happens, visitors and city officials have remarked that the park needs a facelift, and tax returns filed by the board of directors add to the bleak picture. Bracco – who serves on the ad hoc subcommittee along with Dillon and Woodward and who also sits on the board as a council representative – said attendance also continues to drag along with the larger economy.
Gilroy Gardens gives the city 10 percent of its annual profit, but between 2006 and 2007, the nonprofit lost more than $1 million after earning about $11 million in total revenue, according to the most recent IRS tax returns. Over the past six years, though, Assistant City Administrator Anna Jatczak said the park has earned about $258,000 after incorporating other revenue such as interest on investments.
