The Pismo Beach City Council is facing an important decision on one of the city’s beloved landmarks.
At its Tuesday meeting, the Pismo Beach City Council heard a report on its options for what to do with the Chapman Estate, a large bluffside property overlooking the Pacific Ocean that was gifted to the city by resident Clifford Chapman upon his death in 2012.
Since then, the property has been operated by the city and the Chapman Estate Foundation, which manages the private events held at the estate that make up most of the property’s revenue.
The estate consists of the Chapman House, green space, a swimming pool and Gull Cottage, which sustained heavy damage in a winter storm in early January and sparked discussions of how to approach maintaining the property.
The damage to the property has yet to be fully addressed for several reasons, including insurance claim disputes, high repair costs and the unique circ*mstances of how the cliffside property was damaged that make repairs more expensive — leaving the City Council with several options on how to proceed with the property.
Garing, Taylor & Associates consultant Ron Reilly presented the council with several options, including making repairs, improving the property, redeveloping it or selling it outright.
Several Pismo Beach residents asked the City Council to continue supporting the estate, which has been a fixture of the community since its construction in 1930.
Former Pismo Beach Mayor Shelly Higginbotham said while the costs to repair the property were substantial, she hoped the city would continue to invest in the property.
“In 2010 my telephone rang, and it was Clifford Chapman,” she said. “I really didn’t know him, and he said, ‘Shelly, I want to give the city my home.’ When later we spoke, I asked him, ‘Why the city?’ And he said he trusted the City Council, and he trusted the city.”
City Council evaluates potential outcomes for bluff property
Reilly and assistant city manager Mike James presented the council with a set of options that could be approved at a later meeting.
Reilly said under the no change scenario, the city would continue to pursue insurance claims on Gull Cottage to repair winter storm damage.
The property carries a $100,000 insurance deductible, but that may not be able to cover the unique damage the cottage suffered from the winter storm, which was a rare weather event that may not be included in the insurance policy.
As is, the property currently costs around $65,000 a year in maintenance and operations costs, Reilly said.
To bring the estate up to code and make it usable long-term for the city, minimum repairs to the cottage would need to include building inspection repairs, fire safety improvements, Americans with Disabilities Act-related accessibility features and substantial repairs to the property’s seawall repairs, including filling in the caves beneath the bluff, Reilly said.
These minimum repairs would cost the city around $6.8 million in total — at least $3.9 million of seawall and cave infill work, $525,000 in foundation repairs and $330,000 fire and electrical work, with the rest going to other refinishing and repair efforts.
“There should be additional consideration that’s taken into account to take another look at the foundation of the building in and of itself, and as well as just the general hardening of the exterior to hopefully prevent another type of storm from occurring,” James said. “Some of those costs, I will add, may not fall within the range of being covered by the insurance claim because it will not be restoring it back to pre-storm condition — it’ll be enhancing it.”
Reilly said the city could also look into investing more money into the property to make it safer and more profitable in the long run.
This option would cost up to $8.8 million, incorporating the minimum repairs and making improvements such as ADA-compliant parking, pathways and an exterior elevator. Improving the property could also include filling and repurposing the pool area and installing a commercial kitchen for larger event use, Reilly said.
The city could also choose to redevelop the property entirely for use as a recreational, commercial or mixed-use space, but this option is made far more expensive and time-intensive, Reilly said.
Redeveloping the lot would cost $12.9 million, and would take five to seven years to entitle, permit and build something new. Construction setbacks introduced since the property was initially developed have also shrunk the amount of usable land by around 100 to 150 feet from where it is now along the bluff edge.
Reilly said the city could also choose to sell the property outright, either as is or with minimum repairs, which could be valued between $13.5 million and $17 million depending on the extent of repairs.
Can the Chapman Estate sustain itself?
As it stands, the city has spent just under $2.3 million on the Chapman Estate’s operating expenses since acquiring the property more than a decade ago, subsidizing the property to the tune of an annual average of $65,000, according to the staff report.
Because the Estate’s revenue primarily comes from events, Reilly said the city would likely need to consider increasing event fees, increasing the number of events it can host each year and adding more staff for these events to make the project sustainable.
The estate’s unique status as a property gifted to the city also means the city will need to work around several of the terms established in the original property transfer, including the fact that the city is prohibited from profiting from the property’s use or sale.
Selling the property would only allow the city to recoup the money it has put into the property so far, and would need to review the agreement terms to make a determination on where the remaining funds would go.
“My basic understanding is that any leftover funds would go to a mutually agreed-upon non-profit, involving the Chapman Estate Foundation, any remaining descendants and the city,” Reilly told The Tribune in an email.
Additionally, if the city chooses to redevelop the land, it may have to contend with the Surplus Lands Act, which prioritizes using offloaded municipal property as space for affordable housing development or use as public park space.
That said, making repairs to the property’s seawall may prove to be the most difficult aspect of maintaining the estate, Pismo Beach Public Works director Ben Fine said.
Fine said the city’s most recent assessment of the seawall in June showed a section of the wall has failed, and will likely continue to worsen over time from erosion.
Both the seawall and pool area will likely require additional studies to understand the extent of necessary repairs, Fine said.
Of course, as most coastal Shell Beach homeowners would tell you, repairing a seawall is a difficult prospect no matter how deep your pockets are because of the California Coastal Commission’s veto power over any significant changes to the coastline.
Reilly said repairing the seawall would require a coastal development permit from the Coastal Commission, though the commission is usually more receptive to repairs to public lands than it is private properties.
The City Council has a six-month timeline to study the potential outcomes, with the next major decision likely coming in the spring of 2025, Reilly told The Tribune in an email.
Where is the Chapman Estate in Pismo Beach?
The city of Pismo Beach is currently debating whether to fix, sell or update the Chapman Estate property after it sustained damage from winter storms.
Map created with the assistance of ChatGPT.
