By Jonathan Friedman
Associate Editor

February 16, 2016 -- With the family owner of the Shore Hotel believing the Santa Monica facility is operating with proper permits and the California Coastal Commission saying otherwise, this dispute could soon escalate in and out of the courtroom.

Steve Hudson, commission deputy director, said at the State panel’s meeting on Friday in Morro Bay that the Coastal enforcement division has contacted the hotel.

“We will be evaluating further action to address this matter,” Hudson said.

The Shore was on the commission’s agenda mostly as a paperwork item to finalize a decision from September that rejected the request of the ownership, the Farzam family, for an after-the fact permit for the hotel’s construction.

There are lawsuits pending over this dispute--one against the commission’s September decision and another alleging the Farzam family did not have to apply for the after-the-fact permit in the first place because the commission approved a hotel for the property in 2009.

Hudson said the argument the hotel was already permitted was inaccurate because the approval was for a facility at the Ocean Avenue location that did not resemble the one that was built.

“The hotel project approved in 2009 was supposed to be a more bare-bones Travelodge that did not have a restaurant or other facilities typically associated with a high-cost hotel,” Hudson said.

In the view of the Coastal Commission, the 2009 permit expired two years later and the Shore was built without the required coastal development permits.

Attorney Sherman Stacey, representing the Farzam family, told the commission the cost to stay at the hotel went up from what was proposed because market conditions forced this to happen.

He said the commission was making “an effort to compel a fixed price for the accommodations,” something he said it did not have the authority to do.

“The inference that I draw is if you fix your price at a level that the commission finds acceptable, you can be approved,” Stacey said. “ If you do not, you will be denied.”

Stacey further alleged the permit request was denied because during the September hearing he objected to conditions Coastal staff had recommended the commission set if it were to approve the after-the fact permit.

He said this was not appropriate reasoning.

Hudson said Stacey’s allegation was not accurate.

Among the conditions recommended was that the family pay nearly $3 million “to mitigate” for the loss of low-cost visitor accommodations due to the demolition of the two hotels previously located on the property.

There also remains the issue of whether the City should have issued a municipal permit for the hotel’s construction because of the dispute over the coastal development permit.

The City Council voted in October for Santa Monica staff to review the municipal permit issue. Findings from a review have not been released as of February 14.

Also during the meeting, a representative of the local union and a former Shore employee claimed workers who testified at the September hearing about bad practices of hotel management had been fired or warned.

The Lookout contacted the hotel about the allegations, but did not receive an immediate response.

Two of the commissioners said they were upset to hear about the alleged retaliation. Commissioner Roberto Uranga said it was “horrible” and “unacceptable.”

“This is really a sad situation,” Commissioner Carole Groom said. “ We have laws in California that are supposed to protect people.”