LAKEPORT, Calif. – The Board of Supervisors decided Tuesday to move forward with a plan to contract with developers to build a new facility to lease to Lake County Mental Health in the Northshore town of Lucerne.
The discussion followed one held last October in which the board approved the idea in concept.
Like that earlier decision, Tuesday's vote was 4-1, with Supervisor Anthony Farrington opposing the removal of between 40 and 50 jobs from Lakeport, which is located in his district.
Discussed in relation to the proposal was board members' uncertainty about the future of redevelopment, which now is in question due to Gov. Jerry Brown's proposal to eliminate redevelopment and redistribute its funds as part of his effort to address the state budget. Lucerne is in the middle of the county's redevelopment area.
Deputy Administrative Officer Matt Perry reported that the two-story, 11,000-square-foot facility would be built near the Tower Mart on 13th Avenue in Lucerne, would include commercial space and have a facade similar to that of the nearby Lucerne Hotel, which the redevelopment agency bought last year.
Perry told the board that Snyder Commercial Real Estate – which has completed similar projects for the state of California and Sacramento County – came in with the lowest per square foot lease rate of $1.47, with its proposal also being the most complete and responsive.
Perry reported to the board that other firms submitting proposals were Lake Construction of Glenhaven, Ruff & Associates of Ukiah and Ruzicka Rentals in Lakeport. The proposals were evaluated by a panel of county staff from the County Administrative Office, Lake County Redevelopment Agency, Mental Health, Community Development and a Mental Health Advisory Board member.
Snyder Commercial Real Estate has development team members from Bruno's Property Development and Origin Construction – both locally based – and could finish the new building this coming August, Perry said.
That completion time frame is crucial, as Mental Health staff said their lease with Cliff and Nancy Ruzicka for their current location on Parallel Drive in Lakeport expires June 30.
Perry said the Ruzickas also submitted an offer to sell the Parallel Drive building to the county. Two purchase options were proposed: the first, that the county pay $750,000 down with a monthly payment of $11,880 per year for 10 years, for a total of $2,175,000; or no down payment with 20 years of monthly payments of $20,790, for a total of $2,494,800.
Nancy Ruzicka later clarified that the total asking price was $1,750,000, with the final amounts Perry presented including the interest.
Supervisor Denise Rushing asked staff for an assessment of how the possible elimination of redevelopment could impact such projects.
County Administrative Officer Kelly Cox said redevelopment's elimination would limit the county's ability to carry out such development projects, since the county wouldn't be able to provide any assistance to developers.
Farrington raised his concerns about jobs moving out of his district, and said he believed cuts to redevelopment are inevitable.
Supervisor Rob Brown pointed out the risks for all kinds of funding, not just redevelopment. “We can't just stop breathing here just because there's always that potential.”
He said he doesn't particularly enjoy the redevelopment concept but said the county has to take advantage of it, as the community will benefit from it.
Brown suggested that such a project could still take place without redevelopment, pointing out that funding for the Mental Health Department is different from other funding sources.
“The thing that disturbs me about this discussion is now we're talking about all these different options,” he said. “Why didn't we look at all these options before this?”
He said the developers had spent money for their proposals, and questioned why anyone would want to do business with someone – in this case, the county – who goes back and forth on its decisions.
“We never thought they'd cut redevelopment,” said Supervisor Jeff Smith.
Smith felt the county was trying to protect the developers in weighing the concerns.
He suggested the county could possibly use another piece of land it owns for the project. Cox said the cost of the land is relatively small to the overall project, and that by using government-owned land higher prevailing wage requirements would be triggered.
Brown said developers always know the risk. “We don't have to look out for them.”
Rushing said she was coming down on the side of moving ahead with the project. “We've put a lot of effort in the town of Lucerne,” she said, and the community “absolutely and resolutely” needs jobs and the county has a part to play in that.
“The real issue is, are we taking undue risk?” she asked.
Rushing said she didn't think the project presented a risk, pointed out that the proposed lease would save the county money over time and that “the risks are all mitigatable.”
Cox said renting the proposed building, not buying it, is the county's best option due to state funding.
During public comment, Nancy Ruzicka said she was concerned about the loss of jobs for Lakeport.
She suggested the discussion shouldn't center around redevelopment concerns but about serious illness.
“Would any of you seek treatment in a ghetto of a major city?” she asked.
Ruzicka suggested board members needed to drive down one of the alleys adjacent to Lucerne's 13th Avenue. She said she did just that recently and found “high fences and ferocious sounding dogs.”
In the College Square building where Mental Health's headquarters currently are located, Ruzicka said it's well lighted and has a good location.
“Let's not send these services backwards,” she said.
She later clarified to Lake County News that she felt “serious money needs to be spent in Lucerne to remove the blight first.”
Ruzicka's comments at the meeting elicited a strong response from Cox, who was emphatic that Lucerne was not a ghetto.
“Lucerne is a wonderful community,” he said. “Lucerne is going to be the happening place in Lake County.”
Rushing said when she drives through Lucerne she sees a community turning itself around.
Cox added that, “I love that community,” pointing out its enormous potential, especially if redevelopment is successful in converting 13th Avenue into the town center.
Bill Brunetti of Bruno's Property Management noted he never thought he would sit on the opposite side of an issue from Ruzicka, but suggested that the new building would enhance the Lucerne area.
He said he believes they'll be looking at a different financial picture in five years. “The future is probably more optimistic than we're all looking at.”
The county already has made an investment in Lucerne, and Brunetti said that required that they push forward.
The investment was large and gutsy, he said, and such investments aren't made unless you're assuming success.
Mental Health Director Kristy Kelly said that the rent they currently pay for their Lakeport building is $1.84 per square foot, higher than normal rent, she said. She later corrected that to $1.65 per square foot.
Kelly said the developer is able to work on a short time frame, and said Ruzicka already has other potential tenants going through the building.
Rushing said she believed they needed to move forward. Farrington remained opposed, challenging any board member to say they wouldn't be concerned to see so many jobs leaving their respective districts.
“I doubt any of you would say that,” he said.
While Perry's report said that leasing the new building in Lucerne would save close to $600,000 over the coming 10 years than a lease-option for the Lakeport building, Farrington said they would save $1.8 million over 20 years if they worked out a purchase agreement for the current location.
“I can't support this project on the Northshore. It would be a disservice to my district,” Farrington said.
Board Chair Jim Comstock said he wasn't a fan of the county buying property. He said he was concerned that the county couldn't maintain the property it already head.
He acknowledged receiving a letter from the city of Lakeport urging the board not to move Mental Health out of Lakeport.
Rushing moved to go ahead and enter into an agreement for the development, which was approved 4-1, with Farrington voting no.
E-mail Elizabeth Larson at
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