November 24, 2005
8 Questions for Glenn Goldan
by BOB DORAN
The announcement by Eureka businessman Glenn Goldan at last week's City Council meeting came as a surprise to most. Goldan was in the midst of a bitter battle with the Humboldt Taxpayers League, which alleges a conflict of interest in the fact that Goldan and waterfront developer Dolores Vellutini made deals with the Eureka's Redevelopment Agency while they were members of the city's Redevelopment Advisory Board.
Facing a protracted lawsuit instigated by the HTL and ultimately filed by Eureka resident Sue Brandenberg over the issue, Goldan resigned from the RAB and withdrew his plans for Seaport Village Square, a project incorporating a piazza and retail shops along the waterfront at the foot of C Street.
Right: Glenn Goldan
1. You are typically referred to as a developer, but your business, ReProp Financial seems to be more of a mortgage company. What is it you do?
I had been a real estate developer, and I was winding up my career [in that field] with the Seaport Village Project. What I do [with ReProp] is make loans to other development projects as well as agri-business and commercial development. We're in the lending business in the western states, expanding nationwide. We run it out of Humboldt County, but little of our business is done locally.
It wasn't [originally] my intention to do the Seaport Project myself. Going back, if I may, a hotel project [planned for the foot of C Street.] had failed to come together for one reason or another. We needed something to take its place. The Vellutini project was already going through the [permit] process. The boardwalk was being developed. There was a lot of interest in the waterfront. All of a sudden with the hotel project gone, a group came forward saying they wanted the whole [foot of C] property to become a park. I was on the Redevelopment Advisory Board; we said, "We can't afford that." We came up with a compromise, and in the process came up with a heck of an idea. That's the genesis of why I bid that project. At that point I recused myself from any discussion, starting from the crafting of the request for proposals for the project.
2. That was in 2001. By that time you'd been on the RAB for seven years. Why did you join the RAB?
I was encouraged by members of the Blue Ribbon Committee.
The genesis of the RAB was that a grand jury back around 1990 slammed the city of Eureka for not having an advisory board. They felt that the [redevelopment] real estate deals were too back door and were to the betterment of a few individuals. So the new mayor, Mayor [Nancy] Flemming, put together a Blue Ribbon Committee. They came up with a number of recommendations including that a citizen advisory committee be formed, a professional peer review committee with people who are in the [development] game. I joined at that time.
The RAB always had bankers, architects and developers. There are two ways to do [an advisory committee], one was this peer review where it's professional and non-political and everything is based on the economics. The other way to do it is to hire outside consultants like the state does for the CDBG [Community Development Block Grant program]. I don't know what it costs them; with the RAB, we have $2,000 or $3,000 an hour worth of people volunteering their time.
3. Does the HTL lawsuit have legs? Do they have a case?
You're asking the defendant. If you ask any lawyer who's looked over the case the answer is no. What they were attempting to do is create new law. What they are saying is that someone on an advisory committee is the same as someone who is [on] the actual redevelopment agency, which in this case is the City Council, with their redevelopment hats on. If I was on the City Council I could not buy or develop any property within the redevelopment area.
4. So the HTL is challenging the notion of a peer advisory RAB?
That's correct. They're saying that a peer who might gain financially from actions of the RAB, even though he properly recuses himself, cannot act. It's a Catch-22 that will kill off peer review committees all over the state.
5. Weren't you once a member of the Humboldt Taxpayers League?
Yes, I was on the board of directors. There came a point in time when the sort of moderate position, and the mission of the league, started changing. I was asked to re-run for the board and I did not. A couple of years later I quietly stopped paying my dues.
6. When was that?
In the late '90s. Around the time that Leo Sears started showing up at meetings, the track of the meetings started to change. It started to be a constant barrage of complaining that all government was bad, that all that anyone did in government was bad, which was ironic, because both Leo Sears and Jerry Partain come from a background in government. They're retired from the government. They are receiving pensions from government. Leo receives a pension from the county. Jerry Partain receives a pension from the state of California.
7. Why did you resign from the RAB and withdraw your project?
My attorneys asked me what my goal was. I said, "Fight like hell for a year or less, win this thing, and get moving again. And pay whatever it takes to do it." My attorneys took that information, and when we met again, they said, "Glenn, no matter how hard you fight, and how much money you spend, there's no guarantee that you'll be out of this in a year. Even if you win on a summary judgment, we feel they will appeal it, and you'll be in this for three or four years." That was not acceptable.
After talking it over with my wife, weighing the pros and cons, we felt that the best strategy was for me to retire from the RAB, which I hated to do, rip up the exclusive right to negotiate and ask the city to rebid the project letting all comers come. And see if I still have the best project. The risk I take is that somebody else comes up with something better, or politics go awry, and I don't get to do the project.
8. You said you were done with development and real estate, why did you want to do this project?
It was the right project for that end of town; again it's not that I need to do it. And I believe the project will go forward. I put my ego aside and my will to fight these people to show them that this is not civilized behavior. I put aside the fact that some people will say "he was afraid of losing" so that we can get this thing moving -- whether I do it or someone else does it, I'm going to will it to happen. It sounds corny, but it's the truth.
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