Tag Archive | "creek"

Airing it out

Four years after the initial court judgment, the various players reflect upon Hot Creek

As Thursday marked the 4th anniversary of that fateful day in Bridgeport when the Town of Mammoth Lakes lost the Hot Creek (airport litigation) case – and Jay Becker was seen later that night whooping it up at the Rhino in Bridgeport – perhaps it’s time to revisit the case and tell you what I know.

Or at least, tell you what some of the key players have told me.

As I contemplate where to start, I do think it’s important to make a few prefacing remarks.

1.) Context is critical. As former Mayor Kathy Cage recalled, “At that time [the Development Agreement with Hot Creek was negotiated] there was a story a week in the Fifty Center about the next, new fabulous thing. Big planes. Major airlines. Trader Joe’s.” In fact, she recalled a big reception at Terry Ballas’s hangar at the airport which was supposed to herald the arrival of Trader Joe’s.

So there was … some momentum, some pressure on Council to make things happen.

2.) We all recognize that memory is a trickster, and that folks tend to remember things in such a way as to place themselves in a favorable light. So I do believe it’s important to judge for yourself the credibility of each witness, and what they might have to lose or gain.

 

In 1997, Mammoth Lakes Town Council was comprised of Cage, John Eastman, Kirk Stapp, Byng Hunt and David Watson.

The Town had acquired the Mammoth Airport from the County a few years before. Then-Councilman Stapp said there was actually a ballot referendum on whether or not the Town should buy the Airport from the County. The referendum passed narrowly. The Town bought. At the time, Stapp recalls he and Eastman opposed the acquisition.

“It was a service the County should have provided the Town,” he said.

Stapp also vividly recalls one detail of the transaction – a photograph of the Mono County Board of Supervisors celebrating the transaction, Andrea Mead Lawrence grinning broadly while holding a bottle of champagne.

“They were happy to get rid of it,” sighed Stapp.

The airport was a money-loser, so when Terry Ballas, who’d had some experience as a Fixed-Based Operator in Santa Monica, came calling, Mammoth was all too eager to listen.

The issue, however, was that the Town flatly didn’t know what it was doing. As former Mayor and current Councilman Rick Wood said, “The first mistake was that we didn’t have a lawyer [at the time] who’d ever drafted a Development Agreement. We didn’t have a depth of experience in our legal counsel.”

As Stapp added, longtime Town Attorney Peter Tracy was famous for saying, “This isn’t my purview.”

“Then again, nothing’s his purview,” added Stapp.

Cage said the Town chose Councilmember Watson to negotiate the Development Agreement with Ballas because he was “a businessman.”

But every concern expressed by fellow Councilmembers about the D.A. would be dismissed by Watson as a “deal killer.”

And no one wanted to be the deal killer.

“Every time a new version of the D.A. came out, it wasn’t red-lined,” recalled Cage. “It was always just the new version. And then Kirk and I would go through it line by line to try and figure out what changes had been made.”

As Stapp recalled, Airport Manager Bill Manning was the only staff oversight on the contract. The only financial analysis done on the project was provided by Ballas himself, Stapp added.

Again, says Cage, one has to consider the times. “The big deal in the ‘90s was public/private partnerships. That you were supposed to run government like a business. Our role was to cooperate and work with Ballas. His success was our success. Unfortunately, the partnership mentality overwhelmed the regulatory mentality.”

 

Once the D.A. was signed, Ballas began assembling his plans. Former Town Manager Steve Julian, who served from 1999-2003, said he found Ballas to be “pretty straightforward.”

While Julian observed that some areas of the D.A. weren’t clear, “I didn’t think the D.A. was incompatible with commercial air service. We weren’t talking about building LAX for godsakes.”

“While I had a guy in planning (Bill Taylor) who had concerns about the hangar setbacks … we had tacit approval from the San Francisco office of the Federal Aviation Administration for commercial service. Then a new group came in [at the San Francisco office] with a different outlook.”

However, it wasn’t differences with the FAA which led to Julian’s ouster.

It was his differences with Mammoth Mountain Ski Area.

One difference, said Julian, was his insistence that the Town needed some sort of financial backing or guarantee from MMSA to support required investments and upgrades, particularly a terminal facility.

“They [MMSA] were pissed we wouldn’t pay for the whole thing,” said Julian.

“I enjoyed my time there,” Julian said of his stint in Mammoth. “I thought we were going along pretty good. That I got crossways with Mammoth Mountain had a lot to do with it [Julian’s ouster] … Everybody’s dependent on Mammoth Mountain [in that town]. Everyone wants to be on good terms [with MMSA]. It’s a company town.”

Julian added that he was just following orders. “If you ask me to take a hard position, don’t expect me to deliver soft. A lot of times, Council expected miracles. There’s only one miracle worker I know, and we just celebrated his resurrection.”

Sheet: Did Rusty Gregory pull strings to get you fired?

Julian: Yeah. It was clear the Mountain wanted to take over the deal.

When asked what he thought about the Town’s defeat in the airport litigation, Julian simply said, “I feel strongly that if you make an agreement, live up to it, and if you’re not gonna live up to it, renegotiate.”

 

“I’m the one who got Steve Julian fired,” said Tony Barrett (Mammoth Councilman from 2002-2006).

As Barrett explained, when he was first seated on Council, he thought Julian was a strong manager. But then, Julian bought a ranch out in Hammill Valley and Barrett felt he became disengaged, began telecommuting more. “The undercurrent from staff was that they were dissatisfied and Steve was weak,” said Barrett.

At the time, Julian was working with Ballas and Manning on the airport, and Barrett said the perception was that Julian wanted to throw over the FAA and work with Ballas.

“Rusty Gregory wanted Steve Julian fired … and tasked me with it [the job]. He knew my doubts about Julian and fed on that. Wood’s [Rick] thing was, ‘Well, if we get rid of Julian, who do we install in his place?’”

Barrett said Gregory gave him Charlie Long’s business card. Barrett then passed the card onto Wood, not telling Wood exactly how he had acquired the card, and leaving it to Wood to call Long so as to make it Wood’s idea if Long was ultimately hired.

Approximately ten days later, Barrett maintains that a closed session was convened at Dan Wright’s office at the Summit Condominiums and that was the end of Julian.

When asked about the Julian firing, Rick Wood claimed responsibility (working with Kirk Stapp).

“He [Julian] had become buried in the minutiae of FAA demands,” said Wood. “He wasn’t at the office. He wasn’t responsive.”

Stapp described Julian as playing community development negotiator working with Ballas to cut a deal. “What deal we didn’t know. He was leading us around by the nose.”

“I had no idea what deal Steve and Terry were working on,” concurred Wood. “That just died after Steve’s firing. We’ll never know.”

“Obviously, Bill Manning was in the loop and knew of these negotiations,” said Stapp, “but he never told Council afterwards what the status of those negotiations was.”

Sheet: Did Bill Manning work for Town Council or Terry Ballas?

Barrett: Terry.

 

“Bill Manning was extremely forthcoming with everything I asked. If he didn’t know, he’d tell me he didn’t know. He was one of the more consistent players.”

-Steve Julian

 

One more anecdote. Stapp says a contributing factor to Julian losing his job was a sense that he didn’t always tell the truth. “There was a basketball hoop at the airport and every Councilmember had seen Manning shooting hoops down there. When asked about it, Julian denied it. As Rick said to me afterwards, ‘Why would he lie about something so petty?’”

 

Kathy Cage traces back the origins of the D.A. deal to a tangential figure to the story, a man named Dana Severy. Severy was the one who initially pitched the condo/hotel concept, which is how Juniper Springs Lodge was sold.

Wood agreed. “Ballas saw a development opportunity and took it. The selling point was T.O.T. [room tax].”

Barrett claims he, Gordon Alper and Gary Thompson went before Council in ‘97 to urge Council not to sign the D.A.

Barrett said his opposition was fueled by his knowledge of a similar situation in Huntington Beach, where a private airport got shut down by neighbors who didn’t like the noise and traffic.

Barrett said that once the FAA began to have second thoughts about Ballas’s proposed residential project at the airport, Wood and Gregory’s goal was to convince the FAA that timeshare condos are the same as a hotel. “The FAA never bought it,” said Barrett.

When Charlie Long took the reins, he was famous for saying, “What do you want to get done?” Barrett described him as a “fix-it” guy, and by being that guy, Long knew he would also assume a lot of the blame.

Long was interviewed for this story but declined to make any statements for the record.

According to Stapp, “Rusty and Charlie wanted to use the FAA as a hammer to eviscerate the D.A.”

“Long was out to get him [Ballas],” said Stapp. “Rusty was out to get him. And I was out of the loop being fed b.s.”

The irony, maintains Stapp, is that Ballas didn’t perform on the D.A. and if the Town hadn’t granted him various extensions, the D.A. could have been voided.

Rick Wood disputes this. Ballas performed, he said. “There were no breachable issues.”

 

During a closed session of Council during 2004, Long unveiled his plan to get rid of Ballas. His exact words were “Get rid of Hot Creek.”

“I was stunned,” said Stapp. “The rest of Council was, too. Rusty was mentioned as being supportive of this plan.”

Gregory acknowledges that the story is true. Long did tell Council to get rid of Hot Creek. But the original mandate didn’t come from Gregory; it came from the FAA’s Kate Lang. According to Gregory, he passed on what she said to Long, and Long in turn passed it onto Council.

Stapp said he objected. “We have a D.A. What are you doing?”

“At that moment, I decided Long had to go,” Stapp said. “I went to Rick’s office a few days later and said as much.”

Sheet: What was Rick Wood’s culpability, if any, in this saga?

Stapp: I think Rick was being played. I think we were all being played.

Sheet: Characterize Rick’s relationship with Rusty.

Stapp: I think they have a love/hate relationship, but it’s more on the love side.

Councilman John Eastman said the issue wasn’t so much Long’s determination to get rid of Hot Creek as the belligerence he displayed in doing so. In essence, Long’s belligerence short-circuited due process and exposed the Town.

 

By the time Skip Harvey took his seat on Council, it was 2004. As Barrett said, by that time, “we just pressed forward with the FAA.” The Town’s outside law firm based in San Francisco, Morrison and Foerster, assured the Town it held a strong legal position. “We always deferred to the experts. We’re not attorneys. We relied on what they said,” said Barrett.

Meanwhile, the Town’s own legal counsel sounded no alarms. According to Harvey, Peter Tracy continually reinforced that Hot Creek had not lived up to the terms of the D.A.

Sheet: Was Peter Tracy a voice of caution?

Harvey: Not at all.

It was also Harvey’s impression that Rick Wood was not pulling the strings. “It was my impression that Rusty was the ‘unblocker’ when things hit a snag in San Francisco with the FAA.”

Rusty Gregory would agree. “Rick Wood was not the driver behind this,” he said. “I’m not sure what decisions, if any, he could have made.”

In Harvey’s mind, “The whole thing started with the 757s. If we’d just looked at what we were and accepted it, we wouldn’t be in this position.”

He recalled one episode which occurred back in the spring of 2005. He and Gregory were out on the hill together for a morning ski and they’d ski a little ways, and stop, and Rusty would extol the virtues of the big planes, and Skip would tell him to bring in smaller planes, and then they’d ski a little bit more, big planes, little planes, more turns, lift.

 

As one person with intimate knowledge of the case explained, “There was nothing wrong with the D.A. It’s just that eight years later they decided they didn’t like it.”

Again, think context. 1996 was not a boom period in pre-Intrawest Mammoth. Council had had to make some  budget cuts, there had been some staff layoffs and the airport just seemed like a giant, money-sucking albatross.

So Council was desperate to achieve a “net zero” solution. It didn’t care if it made any money on the deal; it was just sick of losing it. And remember, two Councilmen (Stapp and Eastman) were lukewarm at best about it. After all, they never wanted any part of the airport to begin with.

Meanwhile, Stapp characterized then-Town manager Tracy Fuller as in survival mode, Rusty as distracted at MMSA, and the Town gadflies as oblivious.

Ultimately, the Town and Mountain believed that the D.A. agreement was compatible with commercial air service. And as Rick Wood said, “Rusty gave his blessing to the deal. No doubt about it.”

And the infamous letter from the FAA sent nine days before the D.A. was signed? The letter, which pointed out various problems with the D.A., was sent to Manning. As Stapp said, “Council never saw it, and Manning’s explanation was that he gave it to Fuller.”

The Sheet tracked down former Town Manager Tracy Fuller this week and asked her whether or not Manning ever gave her the FAA letter.

“The first I found out about it was in reading The Sheet’s coverage of the trial back in 2008,” she said.

“I believe he [Manning] kept it from me because he knew I’d use it to stop the thing [D.A.].

That was an act of gross insubordination,” she concluded.

There were attempts to rectify the situation. Cage said that after she left Council, she urged every single Councilmember that the Town just needed to buy Ballas out. “They would not consider buying out something that we’d given away for free. It was an ego decision versus a business decision.” Cage mentioned Gordon Alper and Jeff Modoc as others who shared her view.

Barrett said he suggested moving Ballas’s development rights to the Bell Parcel in 2005 to resolve the situation.

Humorous aside: Barrett also said he was confronted by Ballas prior to one Council meeting about the airport situation. “Ballas looks an awful lot like Jim Vanko,” he recalled. “I couldn’t for the life of me figure out why Jim Vanko was talking to me about the airport.”

 

What some don’t realize is that Mammoth Mountain was also sued by Hot Creek at the same time the Town was being sued.

The charge? Tortious interference.

The definition Kirkner found from legal-dictionary.thefreedictionary.com:

Tortious interference. Encouraging a breach, infringing on another’s agreement, interfering with contract, interfering with contractual commitments, etc.

The charge was dismissed, or at least tabled, with the Mountain reaching a “tolling agreement” with Hot Creek pending the outcome of the case against the Town.

A tolling agreement essentially “freezes the clock” so a plaintiff has the option of bringing a case at a future date without running up against the statute of limitations.

 

Meanwhile, starting this week, the Town has commenced a mediation process with all of its creditors and vendors. 16 of 44 have expressed an interest in mediation, which is anticipated to begin next month. MLLA is still refusing to participate in the mediation process.

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Out with the old, in with the access and safety

Paradise residents’ concerns shift in regard to Hooper project

The public still has issues with John Hooper’s Rock Creek Canyon Project located in the community of Paradise, and the Mono County Board of Supervisors will need more information before it can resolve everything.

At a special Mono County Board of Supervisors meeting on Tuesday, April 17, the Board, minus Larry Johnston who had to recuse himself because he owns property close to the project, met at the Paradise Fire Station to review the project’s specific plan amendments and some issues the public had found within an encroachment permit the County had issued Hooper, as well as Hooper’s proposed trails plan.

Local resident Jeff Vaughn summed up the public’s concerns. “Anything iconic [in the project area] is gone. We’re concerned about public access and safety now.”

With the issuance of the encroachment permit, Hooper built some split rail fencing in front of his project, which lies at the on the hairpin turn where the Paradise Lodge once operated.

Described by the public as a “cattle shoot” and giving a “squeeze shoot” effect, the rails were touted as a public safety hazard, which pushes the public into a compromised position between the guardrail and the motoring public.

“The fence is fragile,” said Paradise resident Mike O’Sullivan. “It already impaired snow removal significantly during the one storm we had this year, and it was a very dry year.”

It was also pointed out that the fences remove the option to pull over and chain up in that segment.

“We need to put public safety and snow removal first,” added Liz O’Sullivan. “We don’t want to get sued. Let’s be proactive rather than reactive.”

Mono County Assistant Public Works Director Jeff Walters pointed out that the County had not approved the part of the fence closest to the building.

Hooper defended his split rail by explaining that he had good reason to put it there.

“It gives direction to the trailhead,” he explained. “I got the idea from national parks. Hearing that this is riskier is almost unbelievable. It’s a much safer situation.” Hooper cited the absence of cars backing out into traffic as one example.

 

Supervisor Hap Hazard felt that pedestrians should be kept off the road and some type of passage should be developed behind the guardrail.

“The split rail looks like channeling for rides at Disneyland, I want to see something different in the long run,” he added.

Supervisor Byng Hunt offered a different perspective when he explained that the split rail fence had actually come in quite handy when he and his wife had been biking in the area recently. He did agree, however, that the pedestrian walkway should be moved behind the guardrail.

“The split rail fence is kind of rinky dink,” voiced Supervisor Tim Hansen. “We can kid ourselves and talk about it, but it is what it is. The County should put in a bridge. It’s the safest option.”

Supervisor Vikki Bauer wasn’t ready to make a decision on the split rail fencing and ask that staff come back with more options. The supervisors agreed to leave the split rail where it is until they determine what will take its place.

Another big community concern was the alleged proposal to use Glen Court as a trail. This reference in Hooper’s Trail Plan alarmed residents who fear that eventually the homeowners of the Rock Creek Canyon project would seek to close off the Rock Creek trailhead from Lower Rock Creek Road and try to use Glen Court instead.

Mono County Principal Planner Gerry LeFrancois said that Glen Court was never meant to be a user trail.

Supervisor Hazard suggested that the road be designated as a utility easement in order to protect it from ever being called a trail. He explained that it would most likely need to be used to tie the area into Digital 395, anyway.

Also discussed Tuesday evening: removing excess signage in the area and the installation of a restroom rather than the re-installment of an old fishing cabin that had been removed from the property.

Supervisors, the public and even Hooper agreed that the amount of signage was overwhelming.

As one member of the audience shouted out, “it seems as though they’re breeding!”

As for the restroom, supervisors felt having it on the property was a good idea, but needed to further discuss if the County should be responsible for maintaining the facility.

So, the Board voted 4-0 to remove Glen Court from the Trails Plan, to remove unnecessary signage, and to adopt Option C, which includes having Hooper put in the restroom.

They asked staff to bring back more information on the split rails, a pedestrian bridge, parking, and maintenance of the restroom facility.

 

 

 

 

 

 

 

 

 

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No room (for mediocrity) at the Inn

No room (for mediocrity) at the Inn

New G.M. has Mammoth Creek Inn on the rise

The Master Bedroom in the Master Loft is flanked by two decks offering expansive views of The Sherwins. (Photos: Lunch)

Michael Edelshtain doesn’t like having his picture taken.

But he’s more than happy to have you take pictures of his hotel.

Now the Mammoth Creek Inn (located on Old Mammoth Road across from Schrager’s dental office and Mammoth Creek Park) isn’t his hotel. He’s the General Manager. But he cares for it like it’s his own. And works tirelessly as if it’s his own.

If I’d told Michael that the only time I had to write this story was at 3 a.m., he would have met me in the lobby at 3 a.m. to give me a tour of the facilities.

It’s this fanaticism on behalf of his hotel guests which has paid dividende for Edelshtain since he took the job last October.

He notes that when he started, Mammoth Creek Inn ranked #7 on www.tripadvisor.com among local area hotels (based upon customer reviews).

Mammoth Creek Inn now ranks #3.

Edelshtain attributes the improvement to both customer service and reinvestment in the property.

 

A native of Israel, Edelshtain’s family immigrated to the U.S. in 1988 when he was 10 years old.

He began his career in the hospitality industry 15 years ago at Caesar’s Palace in Las Vegas.

Most recently, he worked at the “Guest House” at UCLA.

 

Mammoth Creek Inn is a two-level, 25 room, 70 bed hotel.

It also features a downstairs conference room for private parties which can accommodate up to 50 persons.

Also located downstairs are a sauna,  steam room, jacuzzi and fitness center.

Above the second floor, in a cozy little alcove accessible via a spiral staircase, the Inn has a small room with a pool table and flat screen television popular with the apres ski crowd.

One area in which Mammoth Creek Inn is trying to drive business is with larger groups. Already, Edelshtain says the entire hotel has been booked by three different wedding parties for three different weekends over the months of June and July.

Edelshtain’s also been trying to create a partnership with reunions.com to drive group sales.

 

Mammoth Creek Inn

Michael Edelshtain, General Manager

 

Among the renovated rooms, the piece de resistance is the Master Loft on the 2nd floor, a two-level room with fireplace and full kitchen and access to two decks which rents for $350/night and sleeps six.

 

Edelshtain had never visited Mammoth before he took the job and, shockingly, does not ski, although he promises to learn – next year. This year, he’s just too busy. He’d like to find time for a girlfriend as well, but his colleagues joke that the hotel wilol run better if he stays singloe and miserable so he can work all hours.

Mammoth Creek Inn is hosting an open house this coming Wednesday from 5-7 p.m. All are welcome. The event will be catered by the Java Joint.


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Hooper’s Rock Creek Canyon Project back in hot seat

Hooper’s Rock Creek Canyon Project back in hot seat

The photo illustrates the narrow road shoulder the public must navigate to access the bike/pedestrian trailhead from the parking lot. (Photo: Lunch)

There was a packed house at the Mono County Planning Commission meeting Thursday morning, March 8 held at the Town/County Conference Room.

Many were present to discuss proposed Specific Plan Amendments to John Hooper’s Rock Creek Canyon Project.

Ironically, the part which most interested the public had nothing to do with the Plan Amendments, but rather, involved a staff-approved Encroachment Permit into the County right-of-way along Lower Rock Creek Road at the curve where the old Paradise Restaurant stands.

Opponents say the split-rail fence installed along both sides of the road about five months ago is an eyesore. They also feel it interferes with snow storage and compromises pedestrian safety between the designated parking area and the trailhead.

Under the current arrangement, pedestrians have to cross the stream in one location via a 4.5-foot wide road shoulder walking against traffic.

The public wants Hooper to build a pedestrian bridge instead which is set back further from the road.

This obviously costs money.

Hooper countered by saying, “The experts [County Staff] told me what to do,” in regards to traffic safety.

Planning Commissioner Steve Shipley suggested the responsibility for such an improvement might lie with the county, “Why would we be asking a private property owner to improve a county right-of-way [property Hooper does not own]?”

This issue heads to the Mono County Board of Supervisors for review next month.

As to public concern that there is a conspiracy to close off the trail at some future date to make Glen Court (in the Paradise neighborhood above Rock Creek Canyon next to the fire station) the primary trail access, Mono County Principal Planner Gerry LeFrancois said this is not the case. “Glen Court was never intended as a primary access point.”

For his part, Hooper added, “The Glen Court thing … wasn’t my idea.”

 

 

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Hart to say goodbye

Hart to say goodbye

The cabins and store at Fern Creek were shuttered as of last Sunday. (Photo: Lunch)

After a 12-year run, bankruptcy has forced out Robin Hart at Fern Creek Lodge in June Lake.

According to property owner Jim Coats, who also operates J and M Ranch in Round Valley, once Hart’s bankruptcy is finalized by the courts, he will foreclose and then sell the property at auction.

The property, which includes a General Store, Fly Shop and nine cabins, will be priced at around $700,000.

It is doubtful the situation will be resolved and the Lodge ready to go for fishing opener.

By that time, Hart will have returned with her two school-age daughters to her hometown of Madison, Miss.

“I really think God knew it was time for me to go home to Mississippi,” Hart said. “I’ll figure it out from there. Find a job, punch a clock. No more midnight phone calls from people saying they’re out of toilet paper or that the right rear burner on the stove doesn’t work.”

Despite her brave front, however, Hart gets teary when she thinks about her loyal guests, particularly the fishermen.

“I can’t be here and see the Lodge closed for opening day. It would be too emotional for me … most openers, I’d give away 15 pots of coffee before 9 a.m.”

Coats, who previously operated the Lodge for 22 years and raised his family there, said “I don’t just want to wash my hands of it. I’d like to find the right person to buy it … It’s unfortunate for both Robin and I,” he concluded.

Hart, however, believes the misfortune could have been avoided if Coats had renegotiated the terms of their purchase agreement, which included a 10.5% interest loan.

Coats said the property will be sold “as is.”

Hart says “as is” includes an existing underground storage tank which must be removed. She maintains the presence of this tank was not disclosed when she bought the property.

However, Hart didn’t buy the property from Coats, but from a previous owner. In other words, she bought into the previously arranged, owner-financed deal.

“As far as I know,” Coats replied, “that tank was removed in the first sale. If it hasn’t been removed, I wouldn’t be surprised,” he added, “but I don’t think it would be my responsibility.”

In any event, Coats said if there were a tank, that would be for a new buyer to take care of.

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Time’s up

MLLA files petition for writ of mandate demanding payment in full from Town 

With more than a $15 million gap still between them, the Town of Mammoth Lakes and Mammoth Lakes Land Acquisition might have reached the end of the negotiation line.

This week, Jay Becker of MLLA distributed a letter to local media that had been sent from MLLA’s legal counsel to the Town’s legal counsel on Jan. 27. The letter accused the Town of acting in bad faith, and explained that MLLA would no longer extend the standstill agreement that has been in place while the two entities have been negotiating. The agreement expired on Feb. 1, and according to the letter had already been extended seven times. The Town and MLLA have been negotiating since April 2011, according to a press release issued by the Town on Feb. 7, although offers did not start shuttling back and forth until fall 2011.

On Feb. 2, MLLA filed a petition for a writ of mandate, which requests that Mono County Superior Court enforce judgment and require the Town to pay the settlement in its entirety. Currently this number stands in excess of $42 million. The Town was served with this paperwork on Feb. 6.

In the letter distributed by Becker, MLLA lawyer, Eric Winston wrote, “MLLA’s prior proposals provided for a substantial discount on the amount the Town owes, outlined concrete steps for the Town to take advantage of that substantial discount and requested that the Town take the matter seriously by moving on a timely basis.”

Councilmember John Eastman, however, confirmed to The Sheet on Feb. 8 that there is still an ocean between what the Town was offering and what MLLA was requesting. The gap, he said, was still “very wide” and “really big.”

When asked if it was more than a $15 million difference Eastman responded, “Yes … more.”

According to the letter, MLLA’s change of heart stems from action the Town took on Jan. 19. On that day, rather than send another counter offer back to MLLA as the Town had indicated it would, it sent a letter withdrawing the offer it had put on the table on Dec. 1, 2011.

“The Town has completely failed to follow through on the representations,” the Jan. 27 MLLA letter said. “Its conduct smacks of bad faith.”

The Town, however, thinks it is MLLA that has acted in bad faith by filing the writ of mandate petition, which according to the press release ceases the settlement process even though, according to the press release, the Town had indicated it would send another counter offer to MLLA after Feb. 1.

“In light of current fiscal realities, the Town has determined that it needs to more closely analyze and assess pertinent issues with financial implications, including the ongoing efforts to reach a resolution with MLLA,” the Jan. 19 letter from the Town to MLLA had stated. “The Town has begun the development of a global restructuring plan, which will address the various fiscal issues impacting the Town.”

In an interview with Town Manager Dave Wilbrecht last month, he pointed out that it was a good thing the Town had not begun its negotiations with MLLA prior to realizing a $2.7 million shortfall going into the 2011/12-budget.

“Can you imagine if we had been working on the settlement based on bad budget numbers?” he had asked rhetorically.

The Town, however, did not fully escape that scenario, as it now realizes its Dec. 1, 2011, offer was based on numbers it cannot afford.

As a consequence of property taxes being down in addition to a winter season with a scant amount of snow and therefore less Transient Occupancy Tax to be collected, the Town is again expecting at least a $1 million shortfall in its 2011-2012 budget.

“We needed time to study the Town Budget,” Wilbrecht said this week of the decision to withdraw the Dec. 1, 2011 offer. “We are recalculating what can be offered.”

According to the press release, “On December 1, 2011, the Town made a multi-million settlement offer to MLLA — an amount that the Town currently feels it cannot afford to pay in light of the worsened fiscal conditions since early December.”

At this time, Wilbrecht stated that the Town is still working on a counter offer to MLLA’s Dec. 14 offer, which was in response to the original Dec. 1 offer from the Town. In the meantime, interest will continue to pile up as the process continues.

As of the filing of the writ of mandate petition on Feb. 2, more than $8.5 million had accrued in interest alone since the 2008 judgment. According to the petition, the post-judgment interest rate for judgments against municipalities is 7%, whic breaks down to $7,000 per day according to Wilbrecht. The Town has yet to pay a single penny on the judgment, according to the MLLA letter and the petition.

The Town and its legal counsel have a certain amount of time to respond to the writ of mandate, according to Wilbrecht.

Wilbrecht reiterated that while MLLA believes the Town is no longer negotiating, “we still want to negotiate.”

The Town Council met on Feb. 6 and 8 in closed session, and plans to meet again on Monday, Feb. 13, at 8 a.m. An all-employee meeting was held on Feb. 8, closing the Town offices from noon-2 p.m.

A public discussion of the situation has been scheduled for the regular Town Council meeting on Wednesday, Feb. 15, at 6 p.m. in Suite Z. Directly following the pledge of allegiance there will be a presentation and the public will be allowed to make comments and ask questions, said Mayor Jo Bacon.

Wilbrecht pointed out that while the Town is still putting together a counter offer to MLLA it also continues to study Chapter 9 (bankruptcy).

“But municipalities going to Chapter 9 [bankruptcy] must still by the law go through mediation first,” Wilbrecht continued.

A new process would kick off if the Town ends up filing for bankruptcy. The Town would have to first prove it is insolvent to even be eligible, according to Wilbrecht.

According to documentation included with the writ of mandate petition, by law the Town should have started paying off the judgment in the fiscal year that the judgment became final, which would have been 2011 after the appeals process. The standstill agreement held that off until now. Only Town funds restricted by law or contracted to other purposes are exempt from being used for payment.

“The unavailability of funds … is not an excuse for non-payment,” explained MLLA in the petition. “The sole exception is setting up a payment plan up to 10 years upon passing an ordinance or resolution, and making show of unreasonable hardship.”

In the petition, MLLA states that it wants the Town to 1.) Take immediate steps to pay and 2.) Include provisions to pay in current and future budgets.

If the Town has unreasonable hardship, “it can move the court to make annual payments with interest continuing to accrue, in installments over 10 years.”

In 2008, a final judgment was issued against the Town of Mammoth Lakes. A jury found the Town guilty of a breach of contract with MLLA. The damages the Town was ordered to pay were $30 million plus attorneys’ fees and court costs. By the end of the appeals process that the Town pursued in 2009 and 2010, additional attorneys’ fees and costs inflated the debt to more than $33 million. As of Feb. 2, with accrued interest, the Town owes $42,186,032.

 

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Settlement negotiations drag on

Resolution of Town’s $42 million debt still far from decided


I’m stuck in Folsom Prison, and time keeps draggin’ on.” -Johnny Cash

Mammoth town officials, as well as the local community, could very well feel that they are in a prison similar to the one the Man in Black so famously sang of years ago. At this time last year, Mammoth was still digesting the news that the Court of Appeals of the State of California, Third Appellate District had denied the Town of Mammoth Lakes’ appeal in the Hot Creek litigation case. The announcement was delivered on Dec. 30, 2010. By mid-March 2011, the California Supreme Court had also denied the Town’s petition for appeal.

At the time of the Supreme Court’s decision, the Town’s Interim Town Manager, (now its Financial Consultant), Marianna Marysheva Martinez stated, “Unfortunately this was the last and highest level of appeal available, which means we have to deal with the judgment.” Marysheva-Martinez was confident that the Town would formulate a plan on how to deal with the judgment and the costs that accompany it.

“It is frustrating for all those involved, but we are going to deal with it,” she said.

Today, it’s still frustrating, especially for the community that is left in the dark on negotiations but ultimately has to deal with the consequences of the outcome.

This week, the Town Council met in closed session to continue to discuss yet another counter back to Mammoth Lakes Land Acquisition, LLC. Negotiations began last fall after MLLA had reviewed all of the Town’s finances. MLLA sent in the first settlement offer, which the Town promptly countered. Since then, counters have gone back and forth between the two entities.

Town Manager Dave Wilbrecht confirmed on Thursday morning that Marysheva Martinez was drafting the latest counter offer back to MLLA following Council’s Wednesday closed session discussions.

Town Councilman John Eastman told The Sheet on Wednesday before heading into closed session that while he would still categorize negotiations as friendly, it did not seem like they were getting any closer to settling. “We still seem far apart in my opinion,” Eastman said.

“For the Town it comes down to what we need to preserve to be a resort community,” Wilbrecht said. “MLLA believes that we have the capacity to cut a lot of services to finance the settlement, and they have every legal right to say that. We lost the judgment, there’s no debating that. We are, however, a resort town with specific needs and Council is trying to preserve those needs.”

Wilbrecht said that the top three items on the preservation list are safety, recreation and tourism.

“Tourism is our primary generator,” he added. “If that comes and goes then the town goes, too.”

Mark Rosenthal, a representative of Raleigh Enterprises, one of MLLA’s partners had “no comment” on the current state of negotiations.

Wilbrecht was unable to spell out the process for each potential outcome [settlement, mediation or bankruptcy] of the negotiations, but he did firmly state that filing for bankruptcy was not “throwing in the towel.”

“Bankruptcy is expensive,” he said. “And we would have to prove that the Town is insolvent to even be eligible. Bankruptcy would affect

all of the Town’s contracts, not just MLLA.”

On the other side of the coin, some community members have wondered whether or not Town staff that was present at the time of the Hot Creek breach of contract that led to the lawsuit in the first place would ever be held accountable. According to Wilbrecht and Town Attorney Andrew Morris, it’s doubtful.

“It would have to be criminal, which it’s not,” Morris said. “It’s not worth looking at even with the community’s frustrations of how we ended up where we are.”

Both Wilbrecht and Morris said that if the employee was acting in good faith (which Morris admitted is a subjetive determination) and made a mistake, the Town would defend them.

“If an employee was responsible for installing new playground equipment and they followed all the protocol to the best of their ability, but someone got injured at the playground, we wouldn’t prosecute the employee,” Wilbrecht said. “No one would want to work in government if they were going to be prosecuted for every mistake they made.”

Both men pointed to the situation in the City of Bell, Calif., as the only instance they were aware of where city employees were prosecuted for a wrongdoing. According to reports, the wrongdoings of that city’s employees and Council were clearly criminal.

In the immediate future, the Town will soon begin budget talks for the 2012/13 fiscal year. According to Wilbrecht, property taxes are down and the lack of snow this season means lower TOT, at least from the first part of the winter season. Coupled with the fact that the Town’s reserve is low means Council may be looking at budget cuts again this year.

“It probably won’t be as bad as last year [when the Town realized a more than $2 million shortfall], but we are pretty thin,” Wilbrecht said.

He expected budget discussions to begin in February.

The only silver lining in all of this, according to Wilbrecht is that at least negotiations with MLLA hadn’t started in the fall of 2010 before Town staff and Council knew they had the large budget shortfall.

“Can you imagine if we had been working on the settlement based on bad budget numbers?” he said.

 

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Page 2: Could be pane-ful

I spoke to Steve Sheffield of Heritage Propane, a corporate spokesman based out of Massachusetts, a few weeks ago about the proposed acqusition of Heritage by AmeriGas.

Heritage is the parent company of Turner Propane. If the Federal Trade Commission approves the deal, AmeriGas would essentially have a propane monopoly in Mammoth Lakes.

Sheffield says he understands concerns from locals who wonder how a monopoly would affect their gas bills. But like a good corporate spokesman, he talked about “greater efficiencies” that would be realized by a potential deal.

The biggest component of price, he said, are external factors relating to the wholesale price which have nothing to do with local conditions.

Local businessman John Vereuck scoffed at Sheffield’s downplay. “My guess is we can expect a 30 to 40% price hike within a year if this deal goes through. What’s to stop them?”

According to Vereuck, he believes AmeriGas overpaid to purchase Rock Creek Energy in 2009. Rock Creek was the company which built the backbone delivery system in Mammoth and until its acquisition, had charged a fixed rate to the other two companies (Amerigas and Turner) to deliver via its system in order to recoup its lay-in and maintenance costs.

Problem is, said Vereuck, those costs were nebulous and never truly delineated.

“What goes up does not go down,” he explained. “Once a company makes back an investment, does the price ever go down? I’ve never seen it.”

Vereuck believes a monopoly may provide AmeriGas the means to obfuscate like never before.

If the deal goes through, is there any likely competitor on the horizon? I spoke to Eastern Sierra Propane’s Founder and Co-Owner Tom Sigler about that this week. He said he’d recently received a call from Mono County Supervisor Hap Hazard about this very topic, as Hazard is concerned about a potential propane monopoly.

“At this point, nothing seems concrete,” said Sigler. “The government could step in [and prevent the merger], so until we know for sure, we won’t make a decision … I never make plans [based] on speculation.”

Sigler did, however, express some reservations about doing business in Mammoth based upon personal experience. “At one point in time, about two years ago, I called the Town of Mammoth Lakes to get an application for a business license,” he said. “Within 15 seconds, I was told that we [the Town of Mammoth] get a percentage of your income.” That a fee is collected by the Town for every drop of propane sold in Mammoth Lakes.

“I just didn’t like the way that sounded,” said Sigler, who dropped the idea of getting a business license.

MLH foreclosure and government handouts

At the final regular Town Council meeting for 2011 (the Dec. 21 meeting has been canceled), Executive Director of Mammoth Lakes Housing, Pam Hennarty presented the recently updated Mammoth Lakes Housing Needs Assessment. According to Hennarty, the study conducted by RRC Associates, Inc. “reaffirmed what we already knew – there is still a housing need.”

Mayor Pro Tem Matthew Lehman was less than thrilled to hear this outcome and questioned the surveys that were used to gather data for the study.

“I took one of the surveys and the questions seemed to be geared toward what type of housing do we need, not whether or not we need housing,” Lehman said. “You can get any answer that you want if you ask the question in a certain way.

“You don’t have demand presented here,” he continued. “Government can’t afford to continue to pay for everything. We need to let the markets do what they are suppose to do and stop the government handouts.”

As if to prove his point, Hennarty confirmed with The Sheet that MLH is currently in default on one of its two office spaces in the Sherwin Plaza Shopping Center on Old Mammoth Road.

“We received our default letter on Monday,” Hennarty told The Sheet. MLH plans to downsize from the two office spaces into the single office space where they are still current.

“The town cuts hit us hard. We have been trying to negotiate the terms but it hasn’t worked out,” Hennarty continued. “We are hoping to deed it back in lieu of foreclosure, but that’s probably not going to happen.”

Town Council member and MLH Board member Rick Wood agreed with Hennarty. “Budget cuts have real consequences,” he said, referring to the cuts made to MLH when the Town tightened its belt last summer. MLH’s operational revenue comes from the Town. “We couldn’t negotiate a loan modification so we can’t afford to be in the space.”

The man holding the note on the loan, John Vereuck, was not terribly pleased with MLH’s decision. He told The Sheet that MLH stopped paying the note before negotiations for a modification had ever really started.

The updated study is available at www.mammothlakeshousing.com or by calling MLH at 760.934.4740.

Medical Marijuana lessens traffic fatalities

According to the Wall Street Journal, a recent study claims that medical marijuana laws reduce traffic fatalities. The study, “Medical Marijuana Laws, Traffic Fatalities and Alcohol Consumption,” D. Mark Anderson and Daniel I. Rees, Institute for the Study of Labor working paper (November 2011) examines federal data before and after 1996 when the passage of medical marijuana laws began. Today, 15 states plus the District of Columbia have legalized medical marijuana. According to the WSJ article, “researchers found a nearly 9% decrease in overall traffic fatalities. (That figure took into account trends in neighboring states.) Virtually the only reason for the decline was a drop in alcohol-related traffic deaths.”

Basically the study concluded that in states where marijuana was legal, people tended to smoke more weed and consume less alcohol. “The authors suggest that pot users may be more aware of their intoxication and correspondingly less reckless, and that using the drug at home, as opposed to bars, might be another factor,” the article concluded.

Spike Todd

Longtime local and owner of Mammoth Liquor Spike Todd was life-flighted out of Eastern Sierra Regional Airport in Bishop at 12:50 a.m. Friday, Dec. 2 to the intensive care unit at Renown Regional Medical Center in Reno, Nev.

According to posts by his brother, Bob, at http://www.caringbridge.org/visit/spiketodd, “Spike went to the doctor Monday and was diagnosed with a sinus infection. He had covered the Bishop football game Friday night and seemed fine. He met his son, David, in Kern Valley Saturday and returned to Mammoth. He told me he had a headache for several days, but it had subsided a bit by Monday.

Still, he was weak and sick and didn’t work last week. Deb [partner] insisted he go the hospital Thursday night, and it was quickly determined he needed critical care. The doctors later said if Deb had not brought Spike in he would not have made it overnight.

The winds were too high to fly out of Mammoth-Yosemite Airport, so he was ambulanced to Bishop, and then flown to Reno.

The cause of his condition is streptococcus pneumoniae (I looked on the fax results about the blood culture).

He was diagnosed with fluid in one lung, along with kidney and liver failure. He suffered a mild heart attack Saturday morning.

A cat scan would help pinpoint the location of the problem in his lung, but he’s not strong enough for that yet.”

Bob’s latest post, dated Dec. 7, stated, “Spike is having a good day, nurses and Dr. Terry say. Fever came down and is being managed; breathing issues are better. He’s still fighting a tough fight, but some optimism today making us all feel good. Great nurses Melissa today and Kelly last night are keeping Spike as comfortable as can be.”

Visit the caringbridge.org website above to keep up to date on Spike’s condition or to send him get-well wishes. If you don’t already have one, you’ll have to sign up for an account, but it only takes about two seconds.

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Page 2: Chasing the wind

Currently discussions between Mammoth Lakes Land Acquisition and the Town of Mammoth Lakes regarding the Hot Creek settlement are like a game of Ping-Pong, with each side taking its turn bouncing ideas back to the other. The ball is presently in the Town’s court as just this week MLLA responded to TOML’s counter offer with … a counter offer.

The underlying question, at least in my mind, is whether all of this talk and back and forth will be worth it in the end? Will the Town ultimately be forced to file for bankruptcy, anyway?

“They did make a counter and we’re looking at it,” said TOML Town Manager Dave Wilbrecht. He added that the Town does plan to make another counter offer back to MLLA.

“If we had liked it [the counter] we would have accepted it,” Wilbrecht continued. “We need to negotiate more.”

At the present time, the Town and MLLA are in settlement talks. The next step of the lawsuit settlement process, if negotiations go nowhere, would be mediation. If that fails, bankruptcy would be next in line.

When asked whether or not the settlement talks were working, Wilbrecht said it was too early to say. “We won’t know until neither party can counter anymore. Right now we are continuing to talk in good faith. Both parties want to work this out, but it is very complex and it’s a lot of money.” Currently the dollar figure sits at $42 million.

“You have to remember that this is a different kind of negotiation,” he added. “It’s not like negotiating for a car where if you don’t like dealing with one dealer you can go on to the next one.

“If it takes a long time, that’s OK, as long as we’re making progress,” Wilbrecht said.

The Town Council held a special closed session meeting on Wednesday to review the counter offer. According to Wilbrecht, there was no reportable action from that session.

 

 

 

 

 

 

 

 

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Letters to the editor

Basic arithmetic

Dear Editor:

I just read Rich Boccia’s letter regarding the successful passage of Measure S. In it he states, “… 73.76 percent of the registered voters supported the renewal of our local parcel tax, Measure.” This is NOT a true statement.

In fact 73.76 percent of the approximately 45 percent of registered voters Who Actually Voted supported the measure. This equates to approximately 33 percent of all registered voters within the Mammoth Unified School District area passing the measure at the ballot box.

I find it ironic that the superintendent of our schools can’t get it right. I hope this wildly exaggerated statement is just a math error by the head of our schools and not more Yes on S propaganda.

Kit Muhs
Crowley Lake 

Draconian forest ideas

Dear Editor:

In response to last week’s letter from Kenyon Kusch. Mr. Kusch, your sense of entitlement and self-importance are not excuses to justify your residence on National Forest public lands. Those campgrounds are meant for recreation, and the stay limits are meant to allow other people to have an opportunity to enjoy them.

The reason for the cut stay limits and the closure of the free campgrounds are the draconian budget cuts implemented against the Forest Service and other federal land agencies. If you expect things to change then write your elected officials. Let them know you want your tax dollars put towards the continuation of recreational opportunities on public lands, instead of bailing out failing private corporations.

Tim Wolfe
San Diego, CA

Police Academy recommended

Dear Editor:

Thank you to the efforts of Officer David Scobie for his time, and of course, all the other officers who contributed to the 2nd Community Police Academy of Mammoth Lakes. I am grateful to have a better understanding of how our local Police Dept. works and what they face on a daily basis, I have a lot of respect for our local Police Department. This class exposes you to experiences, situations and crimes I didn’t know existed in our beautiful little town, but not to worry! I truly think they do an awesome job at keeping our community safe. I would definitely recommend this class to anyone who is interested in a career in law enforcement or just want to learn/hands on how our local Police Dept operates, day to day. Also nice to meet everyone in the class, you guys are great and hope to see you all around town more often. Thanks again to MLPD for all you do for our Community.

Jessica Mormann
Community Police Academy – Class #2

All in the liberal family

Dear Editor:

Forty years ago, the TV series “All in the Family” ruled the airways. It topped the Nielsen ratings for five straight years. The show’s protagonist, Archie Bunker, is an aging conservative, reactionary and bigoted family man who, in his heart of hearts, believes that he is the Americano Supremo — the ultimate White, Anglo-Saxon Protestant. Seems like this ideology has resurfaced lately. Archie Bunker clones are popping up everywhere.

We laugh at Archie’s ignorant rants, but want to slap him at the same time. Example: Bunker, to guest star Sammy Davis Jr.: “Now, no prejudice intended, but I always check with the Bible on these here things. I think that, I mean, if God had meant for us to be together, he’d-a put us together. But look what he done. He put you over in Africa, and put the rest of us in all the white countries.” How about this gem: “If you liberals keep gettin’ your way, we’re all gonna hear a big, loud flush: the sound of the U.S. of A. goin’ straight down the toilet.” In a recent televised debate where a Texas governor bragged about his state leading the nation in putting people to death (creating thunderous applause), this Bunker wisdom comes to mind: “It’s a proven fact that capital punishment is a detergent for crime.”

The very same Death-to-Liberals/God-Bless-America mindset that makes us laugh at Bunker appears to have saturated today’s political climate. Lots of flag-waving and Uber-Nationalism going on. Is a House of Un-American Activites Part III far behind? We are witnessing bizarre behaviors from surly, uncivil types who, like Bunker, believe they are wrapped in a shroud of patriotism and can therefore say and do no wrong.

In the public domain, when the topic of contention suddenly shifts to a windy diatribe of how great the country and the “Right is right!” movement is and how evil liberals are—look out. Here comes the latest Archie Bunker impersonation.

I would like to believe that all but the most numbed-out of Americans are wise to the venom of Limbaughism, Coulterism and Fox Newsism, and are more than willing to band together in a spirit of harmonious interest and working in tandem to solve problems rather than roll over and succumb to the volatile antics of that odd, divisive group that thinks it’s making a monumental difference because it waves flags until they become a blur. We need much more than the folding of the arms, the fingers in the ears, and the foaming at the mouth, all the while stifling anything that resembles progress and looking out for the little guy.

Bunker: “Whatever happened to the good old days, when kids was scared to death of their parents?”

Dennis Kostecki
Mammoth Lakes

Committee’s take on Mill Creek

Dear Editor:

Thank you for your recent coverage of Mill Creek in the Mono Basin—the creek that visitors and residents alike know best from memorable experiences in Lundy Canyon. Lara Kirkner’s article “Not So Gently Down the Stream” (10/29/11) helped illuminate an important water issue with a long history.

Mill Creek is Mono Lake’s third largest tributary yet the valuable habitat it provides for birds, fish, and wildlife has been substantially impaired by the excessive diversion of its water. For many years the Mono Lake Committee has sought to understand why over 75% of Mill Creek’s flow is being diverted when water rights allow for far less. As a straightforward rule, water should remain in our Sierra streams except when lawfully diverted.

One reason for this excessive water diversion problem has been the simple physical limitations of old infrastructure. As the article describes, Southern California Edison is preparing to rehabilitate the system that distributes water after it goes through their Lundy hydropower plant (along with many other improvements required in their hydropower license). Fixing this old infrastructure is a win-win: water rights holders will get their full allocations into the Wilson system through a modern facility, and Mill Creek will prosper by retaining the rest of its flow.

Like any water issue in California, there are many details and complexities in the decades-long history of Mill Creek water management. The Mono Lake Committee’s website at www.monolake.org/millcreek can be a helpful information resource. Additionally, I would like to extend a standing invitation to anyone interested in this issue to stop by our office in Lee Vining, give us a call, or drop us an email anytime—we’re happy to talk with everyone who is interested in this important element of Mono Lake’s watershed.

Geoff McQuilkin
Mono Lake Committee 


 

 

 

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