The Council voted 4-1 on August 18, 2026, to approve a funding reconciliation with the Orange County Transportation Authority that requires Fullerton to return $126,000 in previously expended grant funds — a step staff described as the only route to reapplying for the long-stalled Bastanchury Road widening project.

Council Member Zahra pulled the item from the consent calendar specifically so the public would understand what “reconciliation” meant. What it really means, he said, is that the city is returning $126,000.

Director Baez explained the project’s history. Located just east of Harbor Boulevard, fronting St. Jude’s and the golf course, the widening initiative began in 2004 and stalled in 2006. Grant funding for both design and construction was awarded through OCTA’s M2 program — Project O — in 2007. The design was never completed. Army Corps of Engineers review comments triggered substantial revisions to environmental clearance and redesign, which made it impossible to allocate construction funding before the M2 deadline. The project stalled again.

The city reapplied in 2025, but M2 guidelines prohibit applying for the same project twice. Staff said OCTA itself proposed the reconciliation as a way out: returning the expended design funds voids the earlier application, allowing Fullerton to reapply in the next cycle.

The planned 2027 application seeks $2.7 million, covering design and environmental clearance only — not construction. Staff said the narrower scope removes the risk of another allocation deadline failure, and that the city would return to OCTA and pursue other avenues for construction funding later.

Zahra pressed on accountability, asking who was at fault. Staff characterized it as a combination of factors, saying the 2011 award for both design and construction started a shot clock and that there was likely not enough foresight about how long Army Corps review takes.

Asked whether the city can now anticipate Army Corps requirements, staff said the agency is “notoriously difficult to work with,” but that Fullerton holds records from the earlier submittal that provide a head start. Staff added that without returning the funds, OCTA would not consider a future application for the project eligible.

No members of the public spoke. Zahra cast the lone no vote.

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