North Coast Journal Weekly link to homepageIn the News

Feb. 5, 2004

The Weekly Wrap

Eureka Inn -- sold and shut
Local icon not likely to reopen soon

AIRcata bags out of Arcata Theater
Gymnastics outfit has falling out with owner Robert White



NEW DEVELOPMENT IN PALCO SUIT: District Attorney Paul Gallegos' lawsuit against Pacific Lumber received a shot in the arm late Tuesday when Richard Wilson, the head of the California Department of Forestry during the Headwaters negotiations, revealed that he would not have approved the deal if he had been given correct information on land sliding rates by the company. Wilson's 10-page legal declaration, the subject of a press conference held at the District Attorney's office Wednesday, lends weight to Gallegos' claim that the company used deception to gain access to as many as 100,000 redwoods located on landslide prone slopes.

CHANGING COURSE? Sources close to District Attorney Paul Gallegos say that the DA will soon drop his controversial medical marijuana limits down to the minimums specified by recent state legislation. If so, the change will represent a reversal in Gallegos's policy. The Board of Supervisors recently considered officially approving the Gallegos limits, which at 3 pounds of dried marijuana and a maximum of 99 plants in a 100 square foot space are far more generous then the minimums specified by the recent state Senate Bill 420. At the board's meeting, Deputy DA Wes Keat told supervisors that barring any action by the board the Gallegos limits could remain de facto county policy. Reassured by this, the board decided to form a task force to study the issue further. Gallegos could not be reached for comment.

MORE HEAT IN DA RACE: It's been another interesting week in the District Attorney recall campaign. The Arcata Police Association announced that it had endorsed Deputy DA Worth Dikeman, although the vote was not unanimous. The police did not take a position on the recall itself . Pacific Lumber Co. President Robert Manne sent a letter to all three candidates, Dikeman, Steve Schectman and Gloria Albin Sheets, regarding the lawsuit against PL, saying that the company "has no desire to have the next District Attorney drop this case without a ruling from the Humboldt County Superior Court." Manne noted that the court is three months late on a ruling on PL's request of July 2003 that the case be thrown out, and urged the candidates' "commitment to seek prompt handling of the case before the court." He also said DA Paul Gallegos and his supporters "have been misleading the public by claiming that the March 2 recall is all about PALCO, rather than Gallegos' miserable record." Gallegos supporters, meanwhile, called Manne's statement "doublespeak." Why not just withdraw the request for dismissal, called a demurrer, they wondered, thereby guaranteeing that PL will have its day in court? PL spokesperson Erin Dunn said a ruling on the demurrer would be "part of the process. Why would we want to go to court when we feel it should be thrown out before it gets there?" She also reiterated PL's statement that "we have not endorsed anyone at this time." Will they? Dunn's not saying.... Dikeman, meanwhile, told the Fortuna Chamber of Commerce in Monday's candidate forum there that the recall demonstrates that a large number of people have lost faith in the district attorney. He pointed out that the number of people who voted for Gallegos in the 2002 election, 16,685, is about the same as the number whose signatures appear on recall petitions.

FREE SPEECH? WHO NEEDS IT? A man in a large blue pickup truck with silver stripes was seen plucking a pile of Paul Gallegos signs from yards around Arcata last weekend and dumping them behind Best Lumber. "We got the signs back," said Friends of Gallegos chief Richard Salzman. "It's not uncommon that one side is a campaign of bullies, and they will do these kinds of things to win an election, rather than presenting intelligent arguments."

DIRTY TRICKS? Elections chief Lindsey McWilliams confirmed this week that Mark Loren, an investigator with the Secretary of State's election fraud unit in Sacramento, was in Eureka sniffing around the county elections office late last month. Loren spent a day looking at recall petitions, making photocopies, and looking up names on the county's voter database, McWilliams said. Opponents of the recall have alleged that some signature-gatherers misrepresented the nature of the petitions -- reportedly telling voters, for example, that the recall petition was a "petition against rapists." "I suspect those are the types of behavior they will be investigating more thoroughly," said Richard Salzman of the Friends of Paul Gallegos.

DUCKS SHOT: The Eureka Police Department discovered Saturday that someone had slaughtered 10 ducks at the city's normally tranquil Duck Pond in Sequoia Park. Suzie Owsley, spokesperson for the police department, said that the ducks had been shot in the head with a pellet gun Friday night or Saturday morning. The birds' corpses were left at the site. Owsley said an investigation is pending, and that five of the department's detectives were working the case. "We'd sure like to have anyone who had seen someone or heard something come forward," Owsley said. Anyone who may have information is urged to call the Eureka Police at 441-4060.

CORRECTION TO ABOVE NEWS ITEM, AS OF FEB. 12: The Eureka Police Department has not assigned five of its detectives to investigate the slaughter of 10 ducks in Sequoia Park last month. Nonetheless, spokesperson Suzie Owsley says the department is aggressively pursuing the case. Anyone with information should call 441-4060.

NO PETS FOR CURTRIGHT: Paul James Curtright, owner of the eight puppies slaughtered by his brother Adam last year, was sentenced to three years probation by Judge Christopher Wilson on Monday. Paul Curtright previously pleaded guilty to animal neglect, a misdemeanor charge. As part of the terms of his probation, Curtright was barred from owning any pets -- including his dog Stout, mother of the murdered puppies. The ruling was a victory for animal rights advocates, who in recent weeks urged a letter-writing campaign targeted at Wilson, asking him to turn Stout over to other owners. Wilson is scheduled to sentence Adam Curtright on Feb. 23, and will also determine Stout's future at that time.

REBORN: There will be a 15th annual Humboldt State University Pow Wow, after all. A few months ago it appeared that the annual spring event that attracts Native Americans from across the country and Canada had fallen victim to the state budget crisis. But last week Melissa Tafoya, acting coordinator of the Indian Natural Resource, Science and Engineering program, said, in effect, that the show, which features Indian dancers in traditional regalia, would go on. Several campus departments had reached into their own budget and found enough money to cover a third of the cost of the event, which typically runs about $20,000, Tafoya said.

THE EEL WINS ONE: Help could be on the way for the Eel River, plagued for years by declining salmon runs and, more recently, toxic algae blooms in late summer. Last week, the Federal Energy Regulatory commission threw its weight behind a proposal by federal fisheries biologists to reduce the amount of Eel River water that is diverted to Sonoma County by15 percent. A plan to put the order into effect will be drawn up this summer and changes in operations at the Pacific Gas and Electric Co.'s Potter Valley Project could begin as soon as 2005.

DA DEBATES: Reporters from the Journal, as well as the Times-Standard and the Independent, will question the three recall candidates and Gallegos in a KEET-TV debate, moderated by the League of Women Voters, beginning at 7 p.m. Thursday, Feb. 5, on Channel 13. Viewers will be able to call in questions for the candidates. Another debate is scheduled for Monday, Feb. 9, at 7 p.m. in Goodwin Forum at HSU. Doors open at 6, and the program will be aired live on KHSU 90.5 FM and on Channel 12.

HOLD IT IN YOUR HANDS: The Eureka Reporter has been providing online local news since August. Last week, for the first time, a free hard-copy version hit the streets. "We've gotten a lot of feedback -- most of it's positive, a few negative comments," said editor and publisher Glenn Franco Simmons. Eureka developer and philanthropist Rob Arkley has funded the operation so far, but Simmons said that advertisements were coming in and the paper would seek to be self-supporting as soon as possible. He added that there are long-term plans to turn the paper into a daily, but no date had been set. The Reporter, with a print run of 2,000, can be found at locations throughout downtown Eureka every Thursday. And yes, that is the hand of Journal garden columnist Amy Stewart on the front page of the first issue.

Eureka Inn -- sold and shut
Local icon not likely to reopen soon


The Eureka Inn stood shuttered Tuesday morning, staffed with a skeleton crew under orders not to speak to the press. "Temporarily closed for refurbishments," said a sign posted on the door -- a euphemistic notice, given that the inn stands to be closed for a good long while and that Ray Park, its new owner, has made clear that he doesn't intend to invest anything in the hotel.

The closure of the inn was the final act in the slow collapse of former owner John Biord's financial empire, which in recent months saw criminal charges against the entrepreneur, tax battles and buyout talks and, in the end, the foreclosure of the property by an old creditor. Park, chairman of the Cleveland-based Park Corp., bought the inn at public auction Monday and said he planned to resell it as soon as possible.

Park financed John and Deborah Biord's takeover of the inn in 1995, and was a family friend of Deborah Biord's father, Joe Carter. Park came to Monday's auction with Deborah Biord's brother, Mark Carter of the Carter House Inn.

About 40 people attended the sale, which took place at Fidelity Title on H Street in downtown Eureka. John Porter, who managed the inn for Helen Barnum for 15 years and is now a co-owner of the Benbow Inn, was there, as was Barnum's grandson, Bill Barnum, a Eureka attorney. Bill Carson, general manager of the Santa Rosa-based Fountaingrove Inn LLP, came with one of his company's owners.

Four parties came to bid, including Fountaingrove and Trueman Vroman of Vroman Engineering & Construction of Eureka, but the sale was over almost as soon as it began. Fidelity Title's Pam Poore announced the opening bid -- $690,833.69 -- shortly after 10 a.m. Vroman offered $700,000. Park quickly said "Two million," silencing the entire room. "Going once, going twice," Poore said, and the inn was Park's.

Vroman later said that once Park entered a bid, he knew his plan for the inn -- he wanted to keep it open while at the same time conducting repairs -- had no chance.

As holder of a second mortgage on the inn, the Park Corp. is believed to have a $4 million stake in the property. The foreclosure action brought on the first mortgage was a threat to that investment; if another interested party bought the inn at auction, Park would receive only whatever was left over after the first was paid off.

The second mortgage gave the Park Corp. leverage that other competitors could not match. After paying off the first mortgage of $700,000, the remainder of Park's $2 million bid would be returned to the second mortgage-holder: himself.

Park told a media scrum that formed around him after the auction ended that the inn would be closed until a buyer for it could be found.

"We're just in the finance business," he said.

Employing a dry sense of humor, Park told reporters that he drove all night from Cleveland just to get here in time for the sale, and that now he'd perhaps consider turning the inn into a homeless shelter. Finally, a reporter from another news organization said, "So, it's all about the money for you?"

"Isn't that what life's all about?" Park wondered.

The reporter retorted that it was not what life was all about for her and her colleagues who made only $8 per hour, and Park soon declared an end to the impromptu press conference.

Such gaiety was not in evidence among the inn employees who had attended the auction and who now found themselves out of work. Mark Campbell, chef of the Rib Room, said he was thankful that he had been working two jobs before the inn's closure.

"I'm not like most of the employees, who don't know what they're going to do," Campbell said. Other employees discussed the possibility of openings at the Blue Lake Casino.

Fountaingrove's Carson was philosophic. He said that he and others in his company had determined long ago how much they could invest to purchase the inn, as they had been in talks with Park and Biord late last year. Park's $2 million bid priced them out of competition.

"That's more than we were willing to go," he said. "It only makes sense that [Park] would seek to protect his interest."

After the chit-chatting crowds cleared out of Fidelity Title's parking lot, Park and his attorney, along with Carter and Humboldt County Tax Collector Steve Strawn, walked off together in the direction of the county courthouse.

Strawn said that the attorney came with him to his office and immediately paid off the back property taxes owed on the inn -- a total of $163,157.49.

However, the large federal tax liens placed on all of the Biords' properties in 2002 -- they total nearly $750,000 -- will still be their responsibility. Biord recently told the Journal that he and the IRS were negotiating a settlement to the liens.

The closure of the inn threw local service groups and other upcoming events into chaos. Nancy Kay, president of the local chapter of the League of Women Voters, said that her organization would have to scramble to find a new venue for its "State of the Community Luncheon," normally held in one of the hotel's convention rooms each spring.

"It's an annual community event, and we wanted to maintain it at the inn," she said. "We're still uncertain what to do now."

Last week, John Biord pleaded guilty to failing to pay bed taxes collected from guests to the city of Eureka. He will spend 10 days in jail, most likely to be served with the Sheriff's Work Alternative Program, and must perform 200 hours of community service.

AIRcata bags out of Arcata Theater
Gymnastics outfit has falling out with owner Robert White


When Paul and Jessica Spencer signed a lease last November to rent the Arcata Theater, they were ready to live out a dream.

The couple, who share a passion for teaching gymnastics, had big plans. The old theater was to become AIRcata Physical Arts -- an acrobatics training facility with trampolines and a climbing wall. They figured with the Olympics coming up this summer, gymnastics would be even more popular than ever.

But they did not foresee the stumbling blocks that lay ahead: resistance from the city of Arcata, a seemingly intractable landlord, and, most distressing, paying $3,000 a month in rent for a building they couldn't use. Now, after just three months, they have given up on the Arcata and are searching for a new facility.

Originally the Spencers had thought about buying the theater, but realized they "weren't in a financial position" to do so, as Jessica Spencer put it. Months later, Realtor Debbie Bindel, representing owner Robert White, offered the Spencers a two-year lease with a right to match any offer that came up. They accepted and began laying their plans in earnest.

"We met with the city and everything looked good," said Spencer. The planning department let them know they would need building permits and a historical analysis report, nothing more. No problem, at least so they thought.

After signing a two-year lease on Nov. 4, they started work, first dismantling the theater seats. Less than two weeks later they got their first major shock. Local engineer Terry Clark, who was catching a snack at the pizza place next door to the Arcata, saw Jessica out front and asked her, "What are you going to do about the asbestos problem?" Clark, who works for Winzler and Kelly, had examined the building for someone else who was interested in buying the theater.

The Spencers were aware that there was asbestos in the soundproofing material sprayed on the ceiling; Bindel, who was with Clark when the inspection was made in July, had told them about it. What they didn't know was what Clark told Jessica that day: That the asbestos was "friable" (easily crumbled) and uncontained, and thus a potential hazard to customers.

Not long afterward came more bad news: a letter from Arcata planning department head Tom Conlon ordering a halt to work on the building. Conlon said the city was concerned about the historic significance of the theater seats and about the theater's damaged marquee. He said work could not resume until permits had been issued, and he prohibited occupancy until the marquee was repaired.

The problem with the marquee was deeper than the surface damage caused to the overhang by a wayward truck driver last May. According the Conlon, the city had asked for an engineering analysis two months before the accident. "There was visual evidence of a [structural] problem. It appeared to be sagging and water was leaking through the marquee," Conlon said.

Bindle informed the Spencers that repair plans had been delayed due to negotiations with an insurance company regarding damages to the overhang.

As for the asbestos, it was soon determined that it should be removed, along with lead paint on the walls. The cost? Around $30,000. White asked the Spencers to pay for it, saying that the amount would be deducted from the purchase price if they bought the building. The Spencers refused.

In December they laid down an ultimatum to White: Either fix the various problems -- "the asbestos, the lead paint, the leaking roof, the plumbing problems, the facade" -- by Feb. 1 and skip the rent for December and January, or release them from their lease and return all of their money. If neither were acceptable, they would seek mediation.

"We were responding to all their requests but they wanted everything done yesterday," said White, who offered to skip one month's rent, but not two. After the Spencers retained a lawyer, White agreed to end the lease and to refund an $11,800 deposit the Spencers had put down as part of the lease arrangement.

Nonetheless, the Spencers lost a fair amount of money -- about $6,000, according to Paul Spencer. He said the money was spent on a variety of things, including advertising, the purchase of a computer and legal fees. Jessica Spencer talked about another cost: "Good faith with the community is lost," she said.

Nonetheless, the Spencers are looking for another facility in Arcata and may temporarily rent space in the city's D Street Neighborhood Center to teach gymnastics classes. At the same time, Paul Spencer said he's begun looking for work outside the area. "This really threw our lives into a tailspin," he said.



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