California Code, Harbors and Navigation Code - HNC § 6304.1

Notwithstanding any other provision of law, any port district which has received, or is receiving, money pursuant to the provisions of Division 1 (commencing with Section 30) for the construction or improvement of a small craft harbor or facilities in connection therewith, may enter into a lease of any portion of its land and water area which has been freed from the public trust for commerce, navigation, or fisheries for the development of marine-oriented apartments and townhouses.  Such lease may authorize the lessee to sublet individual dwelling units, but such lease shall not exceed a term of 50 years, after which time any improvements constructed pursuant to the lease shall revert to the district.  Land rental units constructed pursuant to such lease shall be available to all persons on equal and reasonable terms.  Any such lease shall contain express provisions requiring the lessee to provide for reasonable public access across the leased lands to adjacent port water areas.

Nothing in this section shall be construed to allow the use of tide or submerged lands in any manner inconsistent with the California Constitution or with the public trust for commerce, navigation, or fisheries.

Any lease of real property so freed from the public trust which is proposed to be let under the provisions of this section shall first be submitted to the State Lands Commission and to the Attorney General for review and approval, and no such lease shall be let unless the State Lands Commission and the Attorney General find that the proposed lease would be in the public interest and would not be in violation of any provision of the California Constitution or of any term of a grant of tidelands or submerged lands and would not be inconsistent with the public trust for commerce, navigation, or fisheries.