ON THE COVER North Coast Journal Weekly
Dec. 23, 2004


Top 10 Stories of 2004

On the cover, clockwise from top left:
District Attorney Paul Gallegos, the Grand Jury transcripts in the Debi August case,
Wiyot Indians preparing to mark Indian Island transfer, budget woes,
Chris Kerrigan (left) and Rex Bohn, local soldiers, Green Party presidential candidate David Cobb,
demonstration in Klamath Falls, Humboldt Bank bought by Umpqua, an LNG freighter.

Once again, the Journal offers its top 10 stories of the year, and as usual,
those of us on the editorial staff didn't always agree on the topics or their order.
Here's what we came up with -- and here's wishing you a good 2005.
Emily Gurnon, Editor

1. Gallegos beats recall attempt

It's no surprise that the biggest local story in 2003 also became the biggest story of 2004: the attempt to recall District Attorney Paul Gallegos. The recall failed big-time, of course, as voters came down 61 percent versus 39 percent against Measure F in the March 2 election.

Opponents of the liberal DA -- who made enemies early on with his revision of the county's medical marijuana guidelines -- didn't waste any time in organizing against him; rumors of a recall had surfaced as early as March 2003, two months into Gallegos' term of office.

Much of the campaign rhetoric, of course, centered around the issue of "safety" and whether Gallegos was soft on crime. Scores of police and sheriff's deputies, and even a good many of Gallegos' own staff, had genuine concerns about how well this former defense attorney with no prosecutorial experience was going to go after the bad guys. Indeed, the strongest "replacement" candidate was Deputy DA Worth Dikeman, a longtime prosecutor solidly backed by law enforcement.

[Gallegos cheering]Though the "Safety Yes!" committee repeatedly banged the soft-on-crime drum, it was the involvement of the Pacific Lumber Co. -- the target of a fraud suit filed by Gallegos early last year -- that surely tipped the scales on this election. The company, along with its parent Maxxam, contributed more than $313,000 to the recall effort in cash and nonmonetary donations, according to the California Secretary of State's office. As close as we can figure, that was about 80 percent of the total spent to try to dump Gallegos, though the total contributions figure is not available -- the recall committee failed to submit a final report on Aug. 2 of this year to the county's elections office.

The pro-Gallegos forces also raised a hefty war chest, pulling in about $300,000 -- making the race the most expensive in Humboldt County's history. But the Gallegos funds, mostly small donations, came from hundreds of individuals contributors.

Even for some who had questions about whether Gallegos was up to the job, the appearance of a large, powerful corporation trying to buy its way out of a lawsuit was too much to take. Humboldt County progressives rallied around Gallegos as their corporate-crime-fighter hero.

Gallegos' troubles didn't end with the recall election. The 42-year-old DA continues to be plagued with internal strife; a DA investigator, Christine Cook, filed a suit against the county earlier this year alleging that she was subjected to racial and gender discrimination. Two prosecutors, veteran employee Rob Wade and newcomer Ed Borg, resigned to take jobs outside the county. And Gloria Albin Sheets, who ran as a replacement candidate in the recall election, filed suit against the DA's office for alleged discrimination involving the fact that she was laid off from her job shortly after filing a workers' compensation claim.

The lawsuits, as well as the fraud case against Pacific Lumber, are pending.

--Emily Gurnon

> > >  See the COVER STORY:
"Just another day... Shadowing Paul Gallegos" - Feb. 19, 2004

> > >  See the NEWS STORY: "Jubilation at the brewery: hundreds celebrate the DA's easy victory " - March 4, 2004

2. No LNG for Humboldt Bay

The San Jose-based energy company Calpine Corp. first expressed interest in building a large liquefied natural gas (LNG) plant on the Samoa Peninsula over a year and a half ago. But it was this spring that the company was unceremoniously run out of town.

Like the Gallegos recall -- with which it was roughly contemporaneous -- the LNG proposal evoked strong feelings on both sides of the aisle. Supporters thought that the facility would make a substantial contribution to the county's moribund economy. The company promised the county between 60 and 100 new full-time jobs, and many hoped that such a large industrial development on the bay would attract more investment to the port of Humboldt.

[LNG tanker at sea]LNG detractors, on the other hand, thought that the Calpine plant would be a disaster. They had concerns about the safety and security -- concerns that were only intensified when an LNG plant exploded in Algeria in January, killing 22 -- but they also thought that Calpine would hurt, not help, the local economy. They feared that the 900-foot ships that would enter Humboldt Bay to unload the fuel would tie up traffic on the bay, leaving fishermen unable to get to sea.

Debate over Calpine proposal fell to the city of Eureka. The company decided that the best spot for the facility would be the old Eureka City Airport, located near the town of Fairhaven. The airport was owned by the city, and the company wanted to get an "exclusive right to negotiate" (ERTN) on a sale of the property. Activists warned that if this step were taken, the federal government would step in and the city might lose the power to say no to LNG. The company mounted a pro-ERTN ad campaign, listing the names of prominent local supporters.

The issue came to a head on March 16, two weeks to the day after the recall election. The City Council had convened a town hall meeting at Eureka's Municipal Auditorium to hear what residents had to say on the proposal. Nearly a thousand people showed up that evening, a large majority of them anti-Calpine. The next day, company officials abruptly announced that they were pulling out of the deal.

Calpine's withdrawal gave the county's progressives their second big win of the month, and left them with the feeling that the tide had turned in county politics -- the so-called "good old boys network" was no longer in charge. Meanwhile, those who supported a longer look at LNG ---among them future City Council candidate Rex Bohn -- decried the "mob rule" that they said killed the deal and worried about the chilling effect that episode might have on future businesses interested in setting up shop in the area.

The local opposition to Calpine may have had some part in a federal backlash against anti-LNG activists. A clause in the fine print of a budget bill signed by President Bush earlier this month gave the federal government sole jurisdiction over where future LNG facilities are placed.

--Hank Sims

> > >  See the NEWS STORY:
"900 show up for Eureka Council meeting on LNG project" - March 18, 2004

3. More penny-pinching for local government

The bell has been tolling for so many years now that residents may have grown accustomed to its doleful song. Local government is going broke -- costs are rising, while the similarly strapped state government continues to take more and more away from cities and counties.

This year, the rubber met the road. Fourteen county employees -- eight of them with the sheriff's office -- were laid off when the Board of Supervisors passed its 2004-05 budget in June. The library moved to a reduced schedule, closing its doors completely for a week every three months. The county had reached rock-bottom. For a few weeks -- until Gov. Schwarzenegger came through with some money -- the county was, on paper, nearly completely broke, with cash reserves of only $100,000.

[coins]Perhaps because of the cutbacks, the budget crunch busted out of spreadsheets and staff reports into local politics. Just after the budget was approved, the Humboldt Taxpayers League launched a campaign against the "benefit allowance" package that the county pays some elected officials and management level employees. The league argued for the suspension of these so-called "perks," saying that it would save the county upwards of $800,000 annually.

County officials fought back. The benefit allowance was a device designed to save money for the county, they said. Unlike regular salary, money paid to employees under the benefit allowance did not require additional contributions from the county to employees' retirement plans. And members of the Board of Supervisors pointed out that the county's top managers had taken voluntary pay cuts that together added up to many times the amount paid in "perks."

Some of the bitterness left over from this fight may have spilled over into the fall, when the county began campaigning for its solution to the budget crisis -- Measure L, a 1 percent local sales tax increase designed to undo some of the cuts made in budget years previous and to rebuild the county's cash reserves. Revenues from the tax hike were to be split between county government and local cities.

The Taxpayer's League came out strongly against the measure, running an expensive media campaign, including billboards and ads in newspapers and on television. There was some backlash against the league after it refused to reveal who had contributed to the No on L campaign -- an apparent violation of the law, which is being investigated -- but in the end, the measure was crushed at the polls, with 70 percent of the county voting against a tax hike.

--Hank Sims

> > >  See the NEWS STORY: "Feeling the pinch" - June 3, 2004

> > >  See the NEWS STORY: "Measure L" - Oct. 28, 2004

4. Wiyots reclaim Indian Island

It was a monumental occasion, one loaded with symbolism -- for the Native American people whose ancestors have lived around Humboldt Bay for thousands of years, and for the descendants of immigrants who now outnumber them. On June 25, a brilliantly sunny day, Cheryl Seidner, tribal chair of the Table Bluff Wiyot Reservation, and Eureka Mayor Peter La Vallee signed papers transferring ownership of 40 acres of city land on an island in Humboldt Bay back to the Wiyot people.

Seidner and a contingent including representatives from a number of local tribes had paddled in dugout canoes from Indian Island to the Adorni Center for the signing.

[Wiyot tribal members on canoes in bay]The 40-acre gift, described by Eureka City Councilmember Mary Beth Wolford as "long overdue," consolidates the tribe's ownership of the eastern portion of the 275-acre island. The Table Bluff Wiyots purchased 1.5 acres in 2000, taking over an abandoned ship repair facility constructed around 1870.

Before the white settlers came, the Wiyot people held dances on the island, considered a sacred site -- the center of their world. There was no more dancing after Feb. 27, 1860 when a group of settlers paddled out to the island in the dark of night and massacred dozens of men, women and children who were there for a ceremonial dance.

Today, with help from a $200,000 "brownfield" grant from the federal Environmental Protection Agency, the tribe is partway through the long process of restoration: cleaning up remnants of old ships, paints and other toxic material on the land, while drawing up plans for rebuilding an area they call Tuluwat Village, including a revived dance circle.

And in another major event celebrated by local Native Americans, on Sept. 21, representatives of the Hupa, Yurok, Wiyot, Karuk and Tolowa tribes of the North Coast traveled to Washington, D.C., for the opening of the newest and last major museum on the National Mall -- the National Museum of the American Indian. Inside the museum, part of the Smithsonian, is a major exhibit curated by Merv George Sr. and others of the Hupa tribe that will remain at least through 2006.

--Bob Doran

> > >  See the COVER STORY: "The Return of Indian Island" - July 1, 2004

> > >  See the COVER STORY: "Pride of Nations" - Sept. 30, 2004

5. Humboldt Bank, Watermark exodus

Humboldt County's white-collar job market took a hit this year as two companies, Umpqua Bank and WaterMark, shifted jobs out of the area. And, as the year comes to a close, the fate of the county's remaining pulp mill is highly uncertain -- putting another 165 jobs in possible jeopardy.

In May officials from Humboldt Bank and its parent company, Umpqua Holdings Corp. confirmed that 150 workers -- most of them employed at the Humboldt Bank Plaza in Eureka -- would be laid off or shifted to new jobs. The cuts took place after Humboldt Bancorp and its principal operating subsidiary Humboldt Bank were acquired by Umpqua Holding Co., based in Portland, Ore. The $340 million merger was completed in July.

[Umpqua bank facade]The local job base took another hit in September when Arcata-based outdoor sports equipment manufacturer WaterMark, Inc. announced that it is shifting corporate headquarters to Portland, Ore. With the move, about half of the company's 147 employees, those in sales, marketing, product development and demand planning, will be offered positions in Portland, company officials said. Sixty-five workers will remain in Arcata. Around a dozen positions will be eliminated.

WaterMark had initially moved its headquarters to Arcata in 2001 after acquiring Yakima Products, the manufacturing company started in 1979 by local entrepreneurs Don Banducci and Steven Cole.

The job shift is not the first for what was once an important Arcata employer. Company founder Banducci and his partners sold their successful roof rack company to the Kransco Group in 1994. That company moved primary assembly operations to Mexico.

Though the loss of local jobs hit many individuals and families hard, the county is holding fairly steady on employment, according to Dennis Mullins, a Eureka-based analyst with the state Employment Development Department.

Over the last several years, "Our population has stayed relatively flat, our labor force has stayed relatively flat," and though jobs have been lost in areas such as manufacturing, they've picked up in other sectors, such as construction and transportation, he said. "So overall, the county's holding its own."

--Bob Doran

> > >  See the NEWS STORY: "Taking over" - March 18, 2004

> > >  See the NEWS STORY: "Humboldt Bank slashes 150 jobs" - May 13, 2004

> > >  See the NEWS STORY: "Humboldt Bank no more" - July 15, 2004

> > >  See the NEWS STORY: "Watermark moving to Portland" - Oct. 28, 2004

6. Humboldt youth go to war

The war in Iraq has dominated the national headlines since the U.S.-led invasion took place in March 2003. Its impact certainly touches us all. But it is those who are serving in Iraq, and their families, who live the war as a moment-to-moment reality.

With the exception of the National Guard, the military services told the Journal they do not give out information on how many people from a certain county or city are serving in Iraq. The National Guard estimated it had a dozen or so from Humboldt County serving currently in the 579th Engineer Battalion in Iraq, and not just as back-up for the Army. "They're doing patrols, raids, interacting with locals" -- basically working on the front lines as much as any other soldiers, said Capt. Zac Delwiche, operations officer with the battalion headquarters in Santa Rosa. The current group left in April or May of this year and will not return until the same time in 2005.

[photos of military personnel]Marine Lance Cpl. Kelly Miller, 21, of Eureka was deployed to Iraq right after Valentine's Day this year, said his mother, Linda Miller. Two months later, he was being flown back home with severe shrapnel wounds in his upper left arm and extensive nerve damage. "It wasn't easy," she said. "It's still not easy. Basically, you take a deep breath and you just pray."

Though he's still recovering, Miller is now back at Twentynine Palms in Southern California and plans to return to Iraq, either in May or December of 2005, his mother said. When he told his mother of the latest milestone in his recovery, she jokingly asked, "Can I break your arm now? Either that or your leg. Or I'll just duct-tape myself to you and I'll watch your back and you can go forward. I still don't want him to go back, but I have to support what he wants to do."

Others serving since the war began include Army Specialist Nicholas Humphry, the son of Dr. Ted and Cindy Humphry of Arcata, who is also expected to return in 2005 -- he, too, sustained injuries. And Eureka High graduate Sgt. Justin Rick, 24, has settled in Santa Rosa following his Army service in Iraq, said his mother, Cathi Shaw, of Eureka.

Humboldt County's only casualty of the war to date has been Capt. Andrew David LaMont, 31, of Eureka. LaMont was killed May 19, 2003 when his helicopter crashed while on a resupply mission in Iraq.

--Emily Gurnon

> > >  See the COVER STORY: "Divisions over Iraq" - April 10, 2004

7. Eureka man runs for prez

Nationally, the story of the year was the presidential election. Locally, no one played a larger role in the drama than Eureka's David Cobb -- the energetic attorney, activist and politician who became the Green Party's candidate for the nation's highest office.

If Cobb's campaign were to be measured only by the number of votes he received on election day, it would be have to be called a failure. He ended with around 120,000 votes nationwide -- almost exactly one one-thousandth of the popular vote. In 2000, the Greens ran Ralph Nader and got 2.74 percent.

[David Cobb]But getting people to vote Green at the top of the ticket was never a key Cobb goal. (He did encourage left-ish voters in non-swing states not to "throw their vote away" by voting Kerry.) Instead, he campaigned for the party's nomination by vowing to assist Greens around the country who were seeking seats on their city councils, school boards, water districts -- races that the party might actually win.

In the months before the election, he was everywhere -- jetting around the country, appearing with local candidates and getting interviewed on the national media. On the stump and over the airwaves, Cobb displayed his natural political talent, overflowing with excitement about the party's message and optimism about its future. At the end, the Greens won 68 local races nationwide, bringing their total number of officeholders to a record high of 221. Among the winners: Cobb's partner Kaitlin Sopoci-Belknap, who upset an incumbent Republican for a nonpartisan seat on the Humboldt Bay Municipal Water District.

After the election was over, John Kerry promised his supporters in Ohio that he would see to it that every vote was counted. He did very little. Thanks to Cobb's efforts, reluctant Ohio elections officials were forced to begin a recount of their votes for president last week. The recount will likely be symbolic. But if people come to think of it as symbolic of the Green Party, Cobb will have achieved yet another of his aims.

--Hank Sims

> > >  See the COVER STORY: "The Candidate" - July 15, 2004

8. Council race reveals cultural divide

It started out as a simple, run-of-the-mill City Council race. It didn't stay that way for long. The passion of their supporters quickly turned the Eureka City Council race between incumbent Chris Kerrigan and challenger Rex Bohn into the fall's version of the DA recall -- a bitter political fight between the county's cultural factions.

The race was curiously light on the issues. Bohn offered very little in the way of specific policy proposals; Kerrigan mainly pointed to what he had done in the past and said he wished to do more of it. The candidates, when they met in debate, mostly stuck to the script. They complimented each other on their achievements and congratulated each other on their commitment to the city.

[Chris Kerrigan, Rex Bohn]The real race was behind the scenes, and it occasionally leaked out into the public. Kerrigan consultant Richard Salzman, who led the group that defended Gallegos earlier in the year, made headlines in September when a fund-raising e-mail made its way into the press. The e-mail called Bohn, a Renner Petroleum employee, "a reactionary oilman out for revenge" and linking him to the high gas prices of the region.

Then, in the weekend before the election, a secretive group calling itself the Eureka Coalition for Jobs blanketed the airwaves with anti-Kerrigan ads and sent glossy mailers to the homes of registered voters. Bohn himself disclaimed all knowledge of the coalition. Because the ads didn't directly advocate a vote for Bohn, their backers apparently do not have to identify themselves.

The well-funded negative campaign seemed to have little impact. Just like the recall, the left-of-center candidate, Kerrigan, won a resounding victory in the end, carrying 60 percent of the electorate -- leaving everyone to wonder why the race had seemed so close on election day.

--Hank Sims

> > >  See the COVER STORY: "Bohn vs. Kerrigan" - Oct. 21, 2004

> > >  See the NEWS STORY: "Kerrigan exuberant:
Bohn supporters 'shocked' at landslide loss" - Nov. 4, 2004


9. Water wars continue

Upstream farmers, midstream dam operators and downstream Native American tribes continued to fight over Klamath River water rights this year.

Debates heated up this summer when tribes and conservationists met with federal energy regulators in Eureka, pressing them to consider shutting down mid-Klamath dams operated by a Portland-based hydropower company, PacifiCorps. Close to 200 tribal members, scientists and politicians waxed passionate about the declining health of the Klamath, citing blocked fish passages and warm-water reservoirs that are breeding grounds for algae and parasites.

[people in jeep, holding sign "reform ESA"]PacifiCorps, whose current license expires in March 2006, has a pending application for a new 50-year license.

The tribes later went to Scotland to rehash their plight with ScottishPower, the multinational conglomerate that owns PacifiCorps.

In July, folks in Klamath Falls, Ore., staged a rally to support Republican-backed reform of the Endangered Species Act, which protects the lower basin's coho salmon, and in effect is a threat to upper basin crops. In 2001, crops withered after water was diverted downstream to help the coho.

A week later the state Department of Fish and Game released its report on the 2002 fish kill, indicating that, as suspected, disease, high fish densities and low flows were to blame for the massive fish die-off. Bad news continued in mid-November. The Salmon Restoration Council indicated that the fall Chinook run in the Klamath is at an all-time low.

The continued problems on the Klamath were at least partially offset in July, when the Hoopa Valley and Yurok tribes won a major legal victory that increased flows on the river's largest tributary, the Trinity River. The Ninth Circuit Court of Appeals ruled in favor of the tribes -- and against Central Valley farming interests -- when it determined that a Clinton-era plan to restore Trinity fish habitat could go forward.

--Helen Sanderson

> > >  See the COVER STORY: "Upstream, Downstream" - July 29, 2004

10. Debi August's conflict of interest charges

In May, the Humboldt County Grand Jury -- usually a sedate body that contents itself with helpful suggestions to local government -- surprised everyone when it accused a sitting member of the Fortuna City Council of corruption.

With the assistance of the District Attorney's Office, the grand jury had formally accused Councilmember Debi August of improperly using her position on the City Council to smooth the way for a proposed subdivision project -- a project that August, a real estate broker, allegedly stood to profit from.

[files]In September, the Journal succeeded in unsealing the grand jury transcripts that led to the accusation. The transcripts contained a great deal of revealing testimony from August's colleagues and city employees. Among the most surprising was the fact that then-mayor Mel Berti, a respected figure in Fortuna politics, was among those who had suggested to the grand jury that August had stepped over the line. (August has said that her accusers perjured themselves in their testimony, but has not yet offered specifics. The case is scheduled to go to trial early next year.)

The accusation against August was only the most dramatic manifestation of what seemed to be an increasing awareness of issues of ethical behavior in elected officials. The grand jury followed up on the August accusation by recommending that local governments take a look at implementing codes of conduct above and beyond what state law requires.

And in Arcata, Councilmember Elizabeth Conner surprised the city when she resigned her seat in September. The action was precipitated by the Fair Political Practices Commission, who decided -- when Conner asked -- that her job as executive director of the Humboldt Bay Housing Development Corp. would prevent her from voting on a wide range of housing and land use issues.

--Hank Sims

> > >  See the COVER STORY: "The Debi August File" - Sept. 9, 2004




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