GILROY
– To pay back millions of dollars in personal loans, Michael
Bonfante could ask the city to issue 85 housing permits for his
Hecker Pass nursery site.
But Mayor Al Pinheiro says if he does, Bonfante would be
violating the spirit of an agreement the Bonfante Gardens founder
brokered with City Council in December 2001.
GILROY – To pay back millions of dollars in personal loans, Michael Bonfante could ask the city to issue 85 housing permits for his Hecker Pass nursery site.
But Mayor Al Pinheiro says if he does, Bonfante would be violating the spirit of an agreement the Bonfante Gardens founder brokered with City Council in December 2001.
“In my heart of hearts, there’s no way (the housing permits) were ever supposed to benefit Michael Bonfante as an individual,” Pinheiro said.
Bonfante declined to comment Monday regarding his plans for the roughly 32-acre nursery site that he still owns. However, the semiretired Bonfante told The Dispatch last week from his Branson, Mo., home that he would keep his options open.
It has been known that an alternative for the commercially zoned nursery property could involve uses such as a hotel and convention center or a bed and breakfast. But city staff has also confirmed there is another option – Michael Bonfante may have the right to request up to 85 housing permits, even though he never donated the nursery to Bonfante Gardens theme park.
The donation of the nursery was supposed to happen if the park ever needed to sell off land to cover costs. But today, the nursery is still in the possession of Michael Bonfante, and the park wants to sell a nearby but separate parcel it already owns.
“I have a responsibility to the people who gave me those personal loans, and I intend to pay them back,” Bonfante said last week. “What we plan to do with the nursery is still undetermined, but it will be used for the best and highest use in order to satisfy the (private) creditors.”
Getting housing permits and developing it within the Hecker Pass Specific Plan may be that best and highest use, at least for Bonfante. The Hecker Pass Specific Plan already has been granted roughly 430 housing permits from the city, and plans for the mostly residential development are close to landing City Council approval.
If, for instance, Bonfante could receive housing permits and then sell or develop the land in conjunction with the Hecker Pass Specific Plan, the nearly million-dollar nursery site could be vastly increased in value. According to county records, the assessed value – which is often significantly shy of the market value – is $995,000.
The future of the roughly 32-acre nursery that borders Bonfante Gardens came into question after word spread last week of a pending land deal between the park and Eagle Ridge Housing developer Shapell Industries.
To partially lighten the burden of $70 million of bond debt and private loans – as well as unpaid property taxes – Bonfante Gardens wants to sell Shapell Industries a 33-acre parcel east of the park bordering Eagle Ridge. Representatives for Shapell said they want to build up to 99 luxury homes.
That deal awaits the approval of the Eagle Ridge homeowners association in March.
Where did the 85 permits come from?
In December 2001, Bonfante reached an agreement with City Council aimed at making it easier for the former Nob Hill supermarket owner to raise money to aid his struggling theme park.
With certain caveats, Council promised to issue up to a maximum of 85 housing permits for the nursery property, which made the land more valuable as collateral for Bonfante’s personal loans.
In the December agreement, Council promised to amend its growth control ordinance to allow nonprofit companies to apply for “fewer than 100” housing permits if a community benefit can be shown.
Council did as it said it would, meaning Bonfante Gardens theme park can ask the city for up to 99 housing permits. However, the ordinance did not address the 85 units mentioned in the agreement between the city and the park and Michael Bonfante.
So those 85 housing permits are in a sort of limbo, unless Council – with perhaps the backing of the city attorney – makes a firm case against granting them.
“Housing permits are not attached to people or companies, they are attached to properties,” Gilroy Planning Division Manager Bill Faus said.
In other words, Bonfante could make the case that the nursery property should still get 85 housing permits.
Pinheiro, who sits on the park’s board of directors, steadfastly disputed this Monday.
“That agreement was not with Michael Bonfante; it was with Bonfante Gardens park,” Pinheiro said. “(The 85 housing permits) are not in play anymore.”
Councilman Bob Dillon also rejected the idea that the city may owe it to Bonfante to grant the 85 permits. Dillon and Pinheiro both said Bonfante would have to enter the housing permit competition when permits become available roughly 10 years from now.
“This (housing permit) tweaking is getting under my skin. I’m getting a little tired of Bonfante Gardens being a thorn in our side,” Dillon said. “Everyone wants them to succeed. I want them to succeed, but I don’t want them to run back to Council each year with a scheme to save the park. We’ve got to get some closure here.”
Granting 85 housing permits to Bonfante does apparently violate the spirit of the December 2001 agreement. However, the letter of that agreement may stand up to a housing permit request.
The agreement states that any profit from selling the nursery site would have to go back into Bonfante Gardens. Indirectly, the profit would be going back to the park, since Bonfante’s personal loans are tied to the park’s debt (Bonfante used personal loans to loan money to the park).
The agreement also states “if Michael Bonfante wishes to build the residential units, following a time after the loan is paid off, he would ask the City Council for (housing permits) under the normal competition process.” The loan is not paid off, meaning he does not have to enter the competition process for housing permits.
