In April, the city of Anaheim and the state of California reached a settlement agreement that would resolve their dispute over the city’s 2019 land sale of Angel Stadium to SRB Management LLC, a land-holding company owned by Angels owner Arte Moreno. Now, Orange County Superior Court Judge Glenn Salter has granted the California Attorney General’s office’s request to halt the sale of the stadium in light of the ongoing federal corruption probe of now-former Anaheim Mayor Harry Sidhu.
The Ongoing Issues
In October 2019, California Governor Gavin Newsom signed into law certain amendments to the California Surplus Land Act, which requires the city to first offer public land to developers that can build homes for low-income families. The amendments include requiring cities to take a formal action in a regular public meeting to declare land “surplus land,” and the city must support the declaration through written findings.
Importantly, the amendments carve out an exception to the application of the amendments. Section 54234 of the Land Surplus Act states, “if a local agency, as of September 30, 2019, has entered into an exclusive negotiating agreement . . . the provisions of this article as it existed on December 31, 2019, shall apply . . . .”
In December 2019, SRB agreed to purchase Angel Stadium and an additional 153 acres of Anaheim-owned land for $320 million. As a part of the purchase, the Angels agreed to remain in Anaheim until at least 2050.
In April 2021, the California Department of Housing and Community Development (HCD) sent a warning letter to the city warning Anaheim that the city may have violated California’s Surplus Land Act. Specifically, the city failed to declare the land as either “surplus land” or “exempt surplus land” as required by the amendments. In December 2021, the HCD sent a Notice of Violation to the city. In turn, the city responded by denying that the Surplus Land Act applied to the sale of the property.
Specifically, the city has maintained the position that the exception applied to the city’s deal with the SRB. The city entered into an exclusive negotiating agreement with SRB prior to September 30, 2019. Thus, the city did not need to issue any declaration as to the property.
Settlement Agreement
As a part of the settlement between the city and state of California, the city would put 30% of the full purchase price (roughly $96 million) into a trust fund to fund affordable housing in the city within five years. In turn, the city would not admit to a violation of the Surplus Land Act, and the funds could be used to build up to 1,000 additional units.
Corruption Probe
Mayor Harry Sidhu resigned this past Monday, May 23, amidst the federal investigation. Although Mayor Sidhu is not currently charged with a crime, in the Attorney General’s office’s request to halt the settlement, the Attorney General’s office included FBI search warrant affidavits that detailed the investigation. The federal investigation includes accusations of bribery, fraud, obstruction of justice, and witness tampering.
Among the investigation is a December 2021 recorded conversation between Sidhu and Todd Ament, who is also under federal investigation as the former leader of the Anaheim Chamber of Commerce, where Sidhu revealed a plan to elicit a large donation from the Angels due to the land sale.
What is Next
On May 20, Representatives for SRB Management, LLC and Angels Baseball LP sent a letter to the city manager, James Vanderpool, reiterating that SRB Management, LLC and Angels Baseball LP “acted in good faith throughout their dealings with the City of Anaheim.” Additionally, they reminded the city of the benefits of the land sale deal, including keeping Angels Baseball in Anaheim.
Today, May 24, the Anaheim City Council is meeting to discuss the letter and the path ahead. Despite SRB Management, LLC’s assurances, serious questions remain about whether the city acted in good faith. Additionally, the federal investigation may reveal more inappropriate conduct.
Thus, for now, the city’s settlement with the state of California is halted, and the land sale is in jeopardy. SRB Management, LLC has asked the city of Anaheim to move forward by June 14. If the city fails to move forward, Angels Baseball may be finding a new home.
Landis Barber is an attorney at Safran Law Offices in Raleigh, North Carolina. You can connect with him via LinkedIn or via his blog offthecourtdocket.com. He can be reached on Twitter @Landisbarber.
