Friday, April 27, 2007 | Gaylord Entertainment threatened to cancel its development of a $1 billion resort on the Chula Vista bay front if a nearby power plant was allowed to remain standing, according to a letter sent to city and port officials.

The Dec. 11 letter came weeks before the two agencies began ramping up their opposition to the power plant’s operation in the area.

“We are certain that this facility would negatively impact the guest experience at our hotel, if it were to remain in existence by the time of our opening,” Gaylord Vice President Bennett Westbrook wrote to Chula Vista Mayor Cheryl Cox and commissioners at the Unified Port of San Diego.

The influence of the letter, obtained by through a Public Records Act request, is unclear. But its receipt preceded the decisions by both agencies to support the removal of the hulking South Bay Power Plant and to abandon plans for its replacement facility on the Chula Vista waterfront. City and port officials are working to transform the rugged, undeveloped land into a tourist hotspot, and the Gaylord project is the catalyst.

But Westbrook’s two-page message clearly demonstrates Gaylord’s distaste for constructing and operating the planned 2 million-square-foot convention center and hotel near a power plant, despite the agencies’ preliminary agreement to subsidize the company’s development with $308 million.

Allowing the plant to stand would force guests at the 300-foot hotel to view an “eyesore,” he stated.

“I cannot conceive of a situation in which Gaylord would commit to continue the pursuit of our Chula Vista project, if future decisions regarding the plant were to lead to” its continued existence, Westbrook wrote about the 706-megawatt plant that currently operates on 160 acres of port-owned shoreline.

The letter came at a time both agencies were mulling the future production of electricity on the Chula Vista bay front. In the month preceding the message, port staff had been recommending that LS Power, which at the time was operating the existing plant, be allowed to lease nearby land to build a smaller power plant. (Dynegy Inc. took over operations from LS Power last month.)

A month later, plans for a replacement facility appeared to nosedive after a San Diego Gas & Electric official testified at a joint city-port workshop that the utility didn’t want to buy power from the replacement plant. SDG&E later backed off its assertion, but the workshop had already set in motion the port’s March 13 decision to scrap the replacement plant.

A Power Play

  • The Issue: Gaylord Entertainment said in December the company wouldn’t build its convention center and resort if a power plant remained on the nearby shoreline.
  • What It Means: The ultimatum shows that Gaylord was willing to scrap its development and a $308 million subsidy that came with it because of the existence of the hulking power plant. City and port officials eventually supported the removal of the power plant, opening the way for the waterfront’s development.
  • The Bigger Picture: By holding the centerpiece of the bay-front redevelopment effort, Gaylord has the leverage — and, likely, the influence — to make such a demand on Chula Vista and port officials.

Westbrook softened his tone when referencing the replacement facility, which would have been located at the adjacent site. Nonetheless, he expressed resistance, saying “a higher and better use for the proposed relocation parcel could be found” for the site if a state commission found the new plant was not needed.

“My assumption would be that you would share this view, since we share a common interest is [sic] developing the bayfront into a destination attraction that is unrivaled on the West Coast,” Westbrook wrote. “The site that the replacement power plant would occupy presents opportunities for many other uses that would contribute towards this goal.”

Westbrook declined to comment when contacted for this story.

Some officials, notably Chula Vista Councilman Jerry Rindone, questioned whether the plant was being rejected in haste because of “other interests.” Also lurking in the backdrop of the debate over the power plant site is the Chargers football team, which is searching for a new home field. Consultants for the city are currently studying four potential sites within Chula Vista, and the power plant site is considered to be a top contender.

Rindone said he was “mystified” that the city was so eager to renege on the future plant, even though the facility was generating $2 million in fees for the city’s coffers. “We are looking at the potential loss of revenue and boxing ourselves in,” he said at a February meeting.

But Gaylord’s letter demonstrates that public officials were feeling pressure from another influential force.

Port and city officials, as well as local business leaders, have gushed over Gaylord, hoping that the company’s development will kick-start a new economic engine for the South Bay.

The convention center is slated to serve as a centerpiece for the planned redevelopment of Chula Vista bay front. City officials are hoping that revamping the bay front with hotels, condos, parkland and a state-of-the-art marina will ignite the revitalization of its older, neglected western neighborhoods and complement the shimmering new homes on Chula Vista’s east side. The port is interested in the habitat restoration and increased activity that will take place on the now-barren shores.

Since August, Chula Vista and the port have been negotiating with the Nashville-based company over the planned complex. The parties are scheduled to wrap up bargaining next month.

City and port officials who responded to requests for comment Wednesday and Thursday said they either don’t recall viewing Gaylord’s letter, or that it had little bearing on their decision to ditch the power plant.

Port Commissioner Stephen Cushman said he has opposed a power plant on the bay front since he was installed on the panel eight years ago. “It’s finest remaining piece of land in the state of California, and it’s not an appropriate for a power plant when there are any number of places that one can go,” he said. Cushman said he doesn’t recall viewing the letter.

Mike Najera, the port commissioner that represents Chula Vista on the five-city board, said he remembers the letter, but that he didn’t consider it. “I can’t take what they’re going to say and make my decisions based up on that alone,” he said.

Cox, the city’s mayor, said she didn’t see the letter, which was sent six days after she assumed office. Cox said she based her decision to oppose the replacement plant because LS Power didn’t convince her that it needed to be on the waterfront. The current facility is cooled by water, making its proximity to the bay vital, but the proposed successor was not designed to be.

“As soon as LS power wasn’t able to give me a response that they needed to build a replacement plant that wasn’t water cooled on that existing site, that led me to want to look at other options,” Cox said.

While top-level officers said the letter didn’t have any bearing, one Chula Vista administrator who was copied on the letter said she recognized the push Gaylord was making.

Laurie Madigan, the city’s former development chief who resigned in March, left this response for Westbrook’s assistant:

“Thanks Amy — Please let Bennet [sic] know that I got it, and I get it. Laurie.”

Staff writer Rob Davis contributed to this report.

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