A Silicon Valley venture capitalist whose net worth is greater than $1bn is asking the state of California to pay him $30m to restore public access to a beloved beach – sparking fresh outrage in a lengthy legal battle over coastal lands.

Vinod Khosla, the billionaire who runs his own venture capital firm Khosla Ventures and co-founded tech company Sun Microsystems, purchased in 2008 a 53-acre parcel of Martins Beach, which is near Half Moon Bay, about 30 miles south of San Francisco.

This month, Khosla’s attorney wrote to the state saying his client would allow the public access to the beach once again – but only if the government paid him $30m, an amount that public officials say is unreasonably high and not supported by any documentation.

For nearly a century, the beach was a “popular destination for fishing, picnicking, and surfing and other recreational uses”, according to the California state lands commission. The previous owners provided a general store and public restroom and allowed the public to visit the beach, charging a fee for parking.

After purchasing the property, Khosla, who does not live on the property, initially continued to allow public access. But in 2010, he closed the gate and put up signs warning against trespass, prompting multiple lawsuits as well as legislation that required the commission to negotiate with Khosla about restoring public access.

The $30m demand, which Khosla’s legal team suggested as part of negotiations with the state, would give the tech mogul nearly the same amount he spent when he purchased the land for $37.5m.

The dispute comes as California residents have grown increasingly frustrated with wealthy landowners cutting off access to the state’s beaches. The California coastal commission last year reported that beachgoers were repeatedly complaining about private security guards attempting to kick them off public beaches by asserting that they were trespassing on private property.

In Khosla’s case, California officials have aggressively tried to reopen the beach, pursuing recent legislation and joining a lawsuit originally filed by Friends of Martins Beach, a local advocacy group.

Dori Yob, Khosla’s lawyer, wrote in a 3 February letter to the lands commission that the owner closed the property because demand on the beach was low. Yob also claimed that $30m was the current real estate market value of the land.

“The cost to acquire the property is significant and should be weighed against the benefits,” she wrote. “There is not a significant demand for access to the property … In light of the low demand, high costs, lack of threats to resources and no vital link to navigable waters, the key question is this the best and highest use of state funds among the many issues facing the State?”

Yob’s letter continued: “All this expense can be avoided if the Coastal Commission, County, and State cooperate with Martins Beach instead of trying to use coercion to obtain its property.”

Yob did not respond to requests for comment.

California has also considered, as a last resort, re-establishing public access through eminent domain, the act of the government acquiring private lands for public use.

“I don’t think anybody is taking this guy seriously,” said Gary Redenbacher, an attorney for Friends of Martin Beach. “He’s just a guy with a lot of money … Thirty million dollars … is absurd.”

Redenbacher added: “We’re of the position that he’s under a constitutional mandate to allow people to get to the beach.”

The state commission’s executive officer, Jennifer Lucchesi, said on Tuesday that the state did not agree that the “value of the public access” was $30m. She wrote in an email: “We believe the fair market value is significantly less than that. As of today, we have not seen any documentation or analysis supporting the $30 million value.”

