As previously reported by LBREPORT.com, the Council held two Dec. 2020 sessions (closed to the public and the press) "regarding a conference with the City's real property negotiator [City Mgr. Tom Modica] regarding "1126 Queen's Highway, commonly known as the Queen Mary." The December 15 closed session (under CA Govt Code 54956) regarding a "lease amendment terms" was part of a regularly scheduled Council meeting, but on Dec. 28, 2019, the Council held a specially scheduled meeing to conduct a closed session meeting to deal with the same agendized "lease amendment" topic. The agenda identified the negotiating parties as the City of LB and Urban Commons Queensway, LLC. On both occasions, the City Attorney's office said no reportable action took place in the closed session..

On Feb,. 16, 2021, the Council held a closed session agendied as: "Existing Litigation - closed session conference with legal counsel relating to existing litigation pursuant to Paragraph (1) of subdivision (d) of Section 54956.9 of the California Government Code. EHT US1, Inc., Urban Commons Queensway, LLC, et al, United States Bankruptcy Court for the District of Delaware,Case No. 21-10036 (CSS) (Queen Mary)." The subsection cited by the City cites: "Litigation, to which the local agency is a party, has been initiated formally..." (The Council similarly held a closed session on March 16, which was after the date of the City Attorney memo)

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The City Attorney office memo, dated March 10 and prepared by Deputy City Attorney Dawn A. Mclntosh, states in pertinent part:

...I have examined this question based on controlling laws and regulations such as the tidelands trust and the California Coastal Act, but this analysis does not address any obligations, duties or restrictions that may be set forth in any leases, licenses, contracts, subcontracts or other legal instruments that govern operations, improvements or activities that are currently or may in the future be located on Pier H. Based solely on my preliminary and cursory review of controlling laws, the answer appears to be no.

After noting that the Port transferred control of Pier H to the Council in 1992, the City Attorney office memo states: >[p?

If control over Pier H is subsequently transferred back to the Harbor Department, the Harbor Department would once again bear the full responsibility for managing the property in compliance with tidelands trust limitations and restrictions, just as it manages the rest of the lands and submerged areas within the Harbor District.2 It will now be the Board of Harbor Commissioners rather than the City Council who is exercising its fiduciary responsibilities in overseeing the trust lands and submerged areas in Pier H and who will be held accountable to the state for any violations of that [Tidelands] trust.

The City Attorney office memo offers this reasoning to uphold the possible Council action: ,p>

One issue that will need to be addressed is the fact that when Pier H was transferred to the City’s control in 1992, the Harbor Department determined that the lands were no longer necessary for port purposes or port development. (See Ordinance No. HD-1605, Exhibit B.) In order for the Harbor Department to make the findings necessary to take control of those lands back from the City, it will need to explain what has changed since 1992 that would allow the Harbor Department to now make the finding that taking over control of Pier H is now necessary and convenient for the development and operation of the Harbor District. Since the determination in 1992, two things have changed that would support the transfer. First, a primary port use has been developed at Pier H with the Carnival Cruise Ship facilities. Second, the Port Master Plan Update 2020 has increased the focus on visitor-serving and recreational uses provided within the Harbor District at the direction of the California Coastal Commission and these are generally located in Pier H. In addition, basic efficiency in operations would support the transfer because right now the City and Port both exercise control over aspects of actions and activities at Pier H. It would be more efficient for one department to manage this property. Since the property is within the Harbor District and the Harbor Commission has jurisdiction over certain aspects of the use of the property pursuant t to the City Charter and other state laws that cannot be transferred or delegated, it would more efficient if the Harbor Department was the sole department managing and controlling Pier H...

Conclusion: Conclusion: From a review of the granting statutes transferring the lands and submerged areas that govern Pier H and the legal constraints and requirements of the Coastal Act that are applicable to Pier H, it does not appear that there are any legal impediments at a state level that would prohibit the City from transferring control of Pier H back to the Harbor Department. Such a transfer would not implicate tidelands trust issues or violate the California Coastal Act. When the property was originally transferred to the City, the Harbor Department made the determination that the land and submerged areas were not available or needed for port purposes or harbor development. However, since that time, a cruise ship facility was developed at Pier H which is a primary port purpose, and the Coastal Commission began requiring more opportunities, when possible, for visitor-serving recreational uses to be incorporated into Port design and operations. Therefore, the provisions of the City Charter that govern the acquisition and disposition of property by the Harbor Department would not preclude the Harbor Department from taking back control over that same property in this instance.

In order to effectuate this transfer, the City Council would delegate and confer all authorities it obtained in the 1992 transfers for Pier H back to the Harbor Commission and the Harbor Commission would accept the delegation and transfer of control and make the necessary findings required under the City Charter.

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