Del Mar's City Council met behind closed doors Tuesday, Aug. 25, to weigh the city's legal exposure after the 22nd District Agricultural Association terminated a two-year-old agreement to build affordable housing on the Fairgrounds.
The closed session came as the city, the governor-appointed fair board and a local landowner traded letters over the collapsed deal, according to The Coast News.
No action has been publicly reported.
The three-way exchange sharpens a question Del Mar has not answered: where will the city put the low-income housing units the state requires by 2029?
How the deal fell apart
On Aug. 19, the 22nd DAA board voted 5-3 to kill an exclusive negotiating agreement both sides approved unanimously in 2024. That deal envisioned up to 61 affordable units on Fairgrounds land.
Board member Ted Miyahara, who made the motion to terminate, cited uncertainty over whether San Diego would annex the only site the board considered viable, the Surf and Turf RV Park, which sits inside San Diego's city limits.
"The fundamental issue is not simply whether San Diego likes this concept, the question is whether San Diego will take the necessary government action to annex property and allow the city of Del Mar to receive RHNA credit," Miyahara said at the Aug. 19 meeting.
Board members Phil Blair, Frederick Schenk and Lisa Barkett voted against termination. Mark Arabo recused himself voluntarily after Del Mar's council requested a formal investigation into alleged connections between Arabo, Seaside Ridge developers and state Attorney General Rob Bonta. Arabo and Seaside Ridge representatives denied the allegations.
The landowner's challenge
Carol Lazier, owner of the Stensrud Lazier Holding Trust, holds 929 Border Avenue, a parcel the city's housing element designates for low- and very-low-income development under Program 1E. Her attorney, Brooke Miller of Sheppard Mullin, wrote to the council in February disputing the city's claim that "no action is required at this time" on that program.
The letter asserted Del Mar missed its deadline to rezone the property and failed to secure a binding Fairgrounds agreement by April 2024, as required under Housing Element Program 3A. It also objected to the city characterizing Lazier's public comments at 22nd DAA meetings as "bad faith," arguing such participation is protected by law.
Lazier is also associated with the proposed Seaside Ridge project on the North Bluff, where the council on May 19 directed staff to create a new "RM-North" zone at 20 units per acre across 6.2 privately owned acres on Border Avenue at Camino Del Mar.
A narrowing timeline
As we reported Tuesday, the state Department of Housing and Community Development gave Del Mar until November 2026 to secure a lease for the Fairgrounds project. With that deal dead and no replacement in sight, the city has achieved 77% of its 175-unit housing target but remains far short on low-income units: at least 113 of the 175 must serve low-income households.
The 22nd DAA opposed Assembly Bill 2264 without discussing it at any public meeting. The bill, authored by Assemblymember Tom Lackey, would have extended the maximum Fairgrounds lease term from 55 to 99 years. A lobbyist hired by the board hand-delivered an opposition letter to Lackey on May 4, and the bill died in the Appropriations Committee. Del Mar special projects and program manager Kaitlyn Elliott-Norgrove told The Coast News in its Aug. 20 report the city did not anticipate the opposition "since the bill sought to accomplish what was identified in the ENRA."
Mayor Tracy Martinez's Friday, Aug. 21, letter to the fair board accused officials of circulating misinformation and asked for a rehearing when the 22nd DAA next meets Tuesday, Sept. 15.
