Thursday, January 3, 2013

Who Will Pay the Piper?

Posted By on Thu, Jan 3, 2013 at 6:00 PM

The stewards of Arcata's now-defunct redevelopment agency were scolded by a former member Thursday morning, as two contractors worried aloud about when or whether they'll get paid.

The fretting came as the panel debated what to do about roughly $2 million that the state says was improperly spent and now needs to be returned.

The group -- Arcata's Successor Agency Oversight Board -- was getting its first earful of public comments after the scope of the problem became widely known.

Right before Gov. Brown disbanded all of the state's redevelopment agencies, Arcata spent $1.85 million on the Sandpiper Park mobile home project and another $200,000 to help finance Danco's Plaza Point senior housing project. The state claims it was too late to spend that money because redevelopment was on the way out.

The successor agency should have known better, said Arcata architect Kash Boodjeh.

Boodjeh, who resigned from the oversight board after serving briefly, has criticized it for turning a blind eye to impending money problems. Why did the agency hold such brief, unproductive meetings, sometimes of 20 minutes or less, he asked agency members Thursday. "Why didn't you have much to talk about?" he asked pointedly, when so many issues were in play.

In time, the successor agency ought to get about $1 million from mobile home sales, according to Maurice Priest, president of the Sacramento-based nonprofit Resident Owned Parks Inc., which developed Sandpiper Park.

The developer has already sold one mobile home at $59,000 and four more are close to escrow, Priest told successor agency members. The remaining units only lack steps and a bit of paint and they'll be ready to sell. The trouble is, he said, the project is at a standstill since he has not yet paid his local contractors doing the work.

One of those contractors, Greg Pierson of the Pierson Co. construction company, apologized but said he has filed a mechanic's lien against the project to reclaim what he is owed. "I hate to have to do that," he said, "but I had no choice. We're caught in the middle."

The other contractor, Randy Sundberg of GR Sundberg Inc., asked the panel plaintively, "What can you do to help so I can pay my bills?" He said he's still owed $203,218, some of which was promised to vendors and a subcontractor.

Thursday's session wasn't a decision-making meeting, and the five successor agency members who attended seemed almost baffled by what steps to take next.

They face three basic options, according to David Loya, Arcata's deputy community development director: Find the money somewhere (exactly where was unclear, the general fund and "schools" were suggested); go to court and seek an injunction; or "look for a magic solution falling from the sky."

The oversight board will hold another session on its alternatives on Jan. 11.

 

 

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Bob Doran

Bob Doran

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