The Board of Supervisors will hold the budget hearings on the recommended budget beginning at 8:30 a.m. Wednesday, Sept. 8, in the board chambers at the Lake County Courthouse, 255 N. Forbes St., Lakeport.

Copies of the budget are available to community members at the Office of the County Auditor-Controller, second floor of the courthouse.

The supervisors approved a preliminary $185 million budget on June 15 in a 4-1 vote, with Supervisor Anthony Farrington voted no, as Lake County News has reported.

County Administrative Officer Kelly Cox said a lot has changed since the preliminary document went before the board in June, and that will be reflected in the updated budget document he and his staff have produced.

“The final adjustments to the budget that we will be recommending to the board will ensure that the budget remains in balance, and in particular it will be structurally balanced,” he said.

The bottom line number – previously at $185 million – also will change, he said.

Some of the positives that have arisen during the budget process include a slightly better financial outlook for the county, he said.

“We had a significant amount of unanticipated tax revenue at the end of last fiscal year, after the time the recommended budget was prepared,” he said.

That unanticipated revenue came in the form of property tax. Cox initially had estimated that property tax would be down from the previous year by 5 percent. When the final numbers came in over the summer, property tax actually was down by 1.5 percent, he said.

“Additionally, our fund balance carryover from the prior year is significantly higher than earlier projections and federal geothermal royalties were restored,” he said. “That's all good news as far as our budget is concerned.”

Another big positive – no layoffs, said Cox.

In addition, “We won't be recommending increases to operational expenditures but we will be recommending that additional one-time funding be set aside in the budget for some of the board's highest priorities such as road maintenance and water quality-related issues,” he said.

Despite those positives, Cox cautions that the county is still in the midst of challenging financial times.

However, he said he thinks the board and community will be pleased when they have a chance to review staff's recommendations.

The remaining wild card, said Cox, is the state budget process and its potential impact on the county.

“We hoped that we would have a state budget by now, but that's not the case,” he said. “I seriously doubt if we will have a state budget before our county budget is adopted next month.”

If the final budget the state produces has significant impacts on counties, Cox said Lake County might have to go back to the drawing board with its own budget document.

It also could mean that the county will have to provide interim financing for some of its state-funded programs if the state defers payments, he said.

“We're probably in a better position than most counties to be able to do that, but there's a limit to what we can do,” he said.

Cox said he doesn't want to see the county be forced to borrow money.

County staff is working to keep its reserves and contingency funds high enough to be able to handle anything the state throws at them, but he said the county never knows for sure what might happen next with the state.

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At its meeting on Thursday, August 26, 2010, the Lake County Planning Commission found that the Lake County Redevelopment Agency's proposed purchase of the Lucerne Hotel in Lucerne, Calif., conformed with the Lake County General Plan. Photo by Elizabeth Larson.

LAKEPORT, Calif. – The Lake County Planning Commission has given the go-ahead to the county redevelopment agency's proposed purchase of the Lucerne Hotel.

The matter went before the commission at its meeting last Thursday.

Earlier this month the Board of Supervisors approved a purchase option agreement to buy the 75,000-square-foot building and the seven acres on which its sits for $1.35 million from Castlepoint Ministries, as Lake County News has reported.

The property is located at 3700 County Club Drive and 6607 14th Ave.

The redevelopment agency is proposing to purchase “The Castle,” as it is known in Lucerne, and currently is exploring its use in housing a culinary and hospitality training program in cooperation with local community colleges. Another proposal for the building is to convert it into a conference center, an amenity listed in the county's redevelopment plan.

Commissioner Cliff Swetnam noted he has spent the night in the historic building, which was built in the 1920s and has since passed through numerous owners.

“It's kind of hard to miss this particular Lake County landmark,” said commission Chair Clelia Baur.

The planning commission held a brief public hearing on the proposed purchase to explore if it conformed with the county's general plan.

Planner Keith Gronendyke went over the item with the commission, explaining that two vacant manufactured homes on the property either will be removed by Castlepoint Ministries or the redevelopment agency.

Commissioner Gil Schoux asked if the county could afford the building. Deputy County Counsel Bob Bridges explained that the funds would come through the redevelopment agency.

Schoux expressed hope that the proposals for the building would work out. “It's been a dead horse for years,” he said.

Bridges explained that the idea behind the purchase is to revitalize the Lucerne community.

No public comment was offered on the purchase proposal.

Baur, in whose district the building is located, said the proposal corresponds to the Shoreline Communities Area Plan.

She said she believed that, with some imagination, some good mixed uses are possible in the building.

Swetnam moved to approve the conformity report, which Commissioner Bob Malley seconded. The commission approved the motion 5-0.

The Board of Supervisors is planning a September public hearing on the purchase option, which county officials said expires on Sept. 30.

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The Plum Flat Subdivision, proposed to be situated on 105 acres at 10929 Point Lakeview Road in Kelseyville near the Clear Lake Riviera, previously went before the commission for a hearing on July 22, as Lake County News has reported.

Plum Flat LLC, whose partners include local engineer Scott Bennett and architect Vincent Price, were seeking to rezone the property from rural residential to planned development residential, and also were asking for a general plan for development which would allow them to apply for a tentative subdivision map.

At the July 22 meeting commissioners Bob Malley and Cliff Swetnam were absent, and the rest of the commission – Chair Clelia Baur, Gil Schoux and Michael van der Boon – was split over the project and didn't have the quorum to make a decision.

Malley and Swetnam had since reviewed the meeting's tapes and notes, and were prepared to bring their own observations and questions about the project to the Thursday meeting.

Principal Planner Emily Minton reviewed the project for the commission and went over some recent letters the planning department received.

Minton also reported that new requirements to deal with greenhouse gas emissions are taking effect. Those rules already have impacted the proposed Cristallago resort and housing project in north Lakeport, with Minton pointing out that the planning commission required that project to install solar power equipment on commercial and community buildings in the plan.

The letters included one from project opponent and Clear Lake Riviera resident Debi Freeland, who pointed out that a consultant found the county had used an out-of-date initial study environmental checklist to consider the project's significant impacts. Minton said staff had used a form that didn't have two questions on it.

She said county Air Pollution Control Officer Doug Gearhart reviewed the project and found that it was so small it didn't trigger thresholds for mitigations. He suggested that the project include bike lanes and pedestrian improvements to offset any impacts.

Minton also reviewed some proposed buffers around the project, which is in the Rivieras community growth boundary.

Swetnam had questions about easements and proposed access from Bel Air West, which was to be the fire access. He asked if the road was county maintained, but the reports didn't specify that information. Deputy County Counsel Bob Bridges asked Todd Mansell from the Department of Public Works to come down to the meeting to answer questions, and Mansell confirmed it was county-maintained.

Swetnam asked if the commission was approving a 105-home subdivision.

While currently at 30 lots, the developers originally had proposed 105 lots. Minton suggested that the commission should view the approval as being for phase one and should plan for infrastructure for the additional lots. Baur asked if that would include open space requirements; Minton said county code requires open space based on acreage, not lots.

Swetnam also wanted to know if final decisions had been made on a water source and wastewater. Minton said staff was suggesting a community septic system.

The developers were proposing to use a well for a community water system or drill individuals wells. She said they previously had a preliminary agreement with an adjacent property owner for water access, but that individual no longer owns that property.

Did the agreement go along with the property? Swetnam asked. Minton said a letter of intent to enter into an agreement was reached but not recorded.

“So, in essence, the project doesn't have water yet?” Swetnam asked.

“Yes,” Minton replied.

Walter Zuercher, a member of the Clear Lake Riviera Community Association Board of Directors, said he had spoken to Bennett about using Bel Air West as emergency access only. He said the board wanted to know if that would be sufficient to meet regulations, and questioned if that still would be sufficient if 104 lots were developed in the future.

Minton said the county's subdivision ordinance requires that any subdivision that creates more than 30 lots should have at least two access points.

Noting that he didn't believe a 30-lot subdivision made sense for the developer, Zuercher said the association was objecting to the routing of the road. He said he believed people would end up using Bel Air West, not Point Lakeview, to access the subdivision.

“That's our biggest objection to the whole project,” he said.

Zuercher had sent Minton a letter stating that the association would withdraw its objections to the project if Bel Air West remained gated and used for emergency access in perpetuity. He said he wanted to retract that letter if the subdivision was going to 104 lots.

Swetnam, who retired last year after nearly four decades in law enforcement, said he helped coordinate mutual aid response during the Oakland fires. “I was up in the hills while the fire was going on.”

He saw firsthand what happened when people were trying to get out of those communities, which didn't have adequate access. Baur said she witnessed it, too.

Swetnam didn't believe the secondary road access would be enough. “It's a big concern of mine.”

Bennett said they were only seeking 30 lots, and were only required to have one access road. If and when the partners decided to develop beyond that, they would be required to do the secondary access.

Swetnam said his main objection was not having secondary access. “I don't like the one-way-in, one-way-out.”

Bennett said they also would have a greenbelt area which would help in case of a fire. Swetnam asked if he wanted to be the guy standing in the greenbelt when the fire came through.

Regarding the water supply, despite no longer having an agreement for the adjacent property, Bennett said they had demonstrated there is water for the subdivision.

He explained that he and his partners were asking for a general plan of development, and noted that they can't do anything until they complete a specific plan.

“We're just trying to jump a few hurdles at a time,” he said, adding, “There's lots, lots more work that needs to be done, obviously.”

Bennett said more detail would be presented at a future date, within a two-year time limit.

He went on to explain that they were fully aware of new greenhouse gas emission laws, and he spent Wednesday in Sacramento getting information on the subject. A brand new green building code will go into effect on Jan. 1, which will require stormwater pollution prevention plans for each lot developed.

Bennett, who is a certified green building professional, said the project would be environmentally friendly, with 35-percent open space, buffers and a park, and a 60-foot right-of-way, 10 feet wider than required.

Baur asked if they're staying at 30 lots. Bennett said the economy may dictate that 30 lots is more then enough. “We're trying to get some sort of approval from the county,” he said, explaining that a general plan of development will give the partners some sort of confidence that they have a project worth pursuing.

Minton added that in a meeting about the previous proposal for more lots the Mt. Konocti Mutual Water Co. said they would not allow the subdivision to connect into the water system.

Community member Anna Ravenwoode suggested that septic system likely would affect the lake. “We don't need any more problems in Clear Lake,” she said.

Ravenwoode argued that the project needed an environmental impact report to address water issues, air quality and which oak woodlands on the land would be protected. She said 75 percent of the land is oak woodland.

Swetnam said he wasn't opposed to the project, but he had a problem with access. Even though the developers were only proposing 30 homes, which necessitates only one road in and out, he said they are in a high fire area. The road itself is close to a mile long, which is too long for the present configuration.

“I'm going to insist on two ways in and two ways out for my support of your project,” he said.

Van der Boon agreed with Swetnam about the road issues, and also stated he wasn't against the project.

Schoux suggested the commission may be too premature in its concerns, and while he wasn't a fan of using Bel Air West, he felt they should let the project proceed.

Pointing out that the report on the project was as thick as the stack of complaints, Malley said Bennett needed to do a better job of selling the project to his neighbors.

While he believed the houses would sell in a recovered economy, Malley added, “You need to do a little legwork out there and find out what the real concerns are with your neighbors and try to address that.”

Baur also wanted secondary access, saying that one road for 30 homes might work elsewhere in the county. But recalling seeing people die trying to escape from the Oakland fires, Baur said, “It's clear to me that this project may not stop at 30 parcels.”

She said they should look at the project as 104 units in phases, and argued it was like piecemealing to say they're only going to look at 30 parcels now. She said that was unrealistic, and they needed to see all phases and their cumulative impacts.

After a short break staff returned with two proposed motions to turn down the rezone and the general plan of development based on inadequate road access, no clear proposal for water and sewer, piecemealing, and no cumulative studies for water, sewer, traffic and other matters.

Swetnam moved both motions, with were approved 4-1, with Schoux voting no on each.

Bennett didn't return a call seeking comment on what steps he and his partners may take next.

Minton told Lake County News on Friday that the developers can request the Board of Supervisors review the decision within five days. As of Friday, that request hadn't been made.

If they want to go forward with the project, Minton said the developers will have to start the process over.

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About 45 minutes into the meeting, a break was called after Roy Simons, 84, and Chuck Leonard, 72, exchanged words. At one point Simons had a hold of Leonard's arm.

The meeting's main agenda item was a discussion of the final version of the draft guidelines for a proposed city homebuyer program and housing rehabilitation program.

City Administrator Dale Neiman, who was injured last month in a fall and broke his finger, collarbone and back, was back for his first council meeting since his accident.

He was discussing the guidelines, which – since they were introduced to the council last year – had been put on the back burner because of other priorities. More recently, the city's redevelopment advisory committee approved the guidelines in a 4-0 vote.

He said the program works by using a primary commercial lender, with the redevelopment agency providing silent second loans.

Through the years the city has made loans that have helped rehabilitate or build 320 low- and moderate-income housing units, said Neiman. However, most of the loans were deferred, or recovered on the property's sale, so no income has been coming in.

Simons questioned the homebuyer loan committee in the guidelines, which consists of three people – the city finance director, the agency's executive director – which is Neiman – and a member of the community with banking or real estate experience appointed by the mayor. Neiman said they could add more people to the committee.

Simons began to criticize Neiman and when Mayor Judy Thein tried to insist that he be respectful Simons told her to be quiet.

He then told Neiman that the committee needed more than three people, “especially if you're one of them.”

Vice Mayor Joyce Overton said she wanted to see two at-large seats added.

Simons asked Neiman if he had banking experience. Neiman said he has worked on numerous commercial loans.

Leonard intervened, telling Simons to stop the direct attacks, adding that Neiman had thousands of times more knowledge about running a city than Simons did.

“You have no idea what the hell you're talking about,” said Leonard, as someone yelled “point of order” from the audience.

“You're being so nasty and stupid about it,” Leonard said to Simons.

Immediately after that, Simons was holding Leonard's arm, and Thein called for a break.

Police Chief Allan McClain came onto the dais and stepped between the two, telling Simons to calm down.

During the break the two men stood toe to toe and continued to argue, with Simons asking Leonard if he wanted to go outside.

When community member Estelle Creel attempted to walk onto the dais while the men were talking in order to speak with Simons, McClain told her to go back to the public area of the room.

“Have a seat or step outside,” McClain repeated several times before Creel retreated to the audience area.

Five minutes later, the meeting reconvened, with Thein saying she hoped everyone would follow the rules of conduct.

Overton asked to continue the matter so they could look at how the county has configured a comparable committee.

“That's exactly what I was going to suggest also, so I'm very much in favor of it,” Simons said.

Richard Birk, president of the local Habitat for Humanity chapter, said the group has its own loan committee and would be happy to help the city.

“I'm encouraged that you want to do this,” he said, noting that Habitat hopes to team up with the city, because the group wants to help its citizens.

The council agreed to bring the matter back, and the meeting – which ended at about 7:15 p.m. – witnessed no further confrontations.

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The meeting will begin at 6 p.m. Thursday, Aug. 26, in the council chambers at Clearlake City Hall, 14050 Olympic Drive.

City Administrator Dale Neiman's report to the council explains that the proposed program guidelines are a finalized version of a document presented to them in preliminary form last year.

Neiman reported that the city has $3.3 million in housing bond proceeds through the redevelopment agency that will be used to carry out the program, which will offer a variety of loans to low- and moderate-income city residents.

The program also will offer substantial home repairs, he said, with the city looking at ways to work with Habitat for Humanity.

Other items on the agenda include the Lake County Youth Center Dancers' presentations of the Maori Poi ball dance and other Tahitian dances, and a report from Nancy Bennett, regional public affairs manager for the League of California Cities.

On the council's consent agenda, which consists of noncontroversial items expected to be acted upon at one time without discussion, the council will accept a review of bills, the Clearlake Police Department's monthly report, consider approving an agreement between Konocti County Water District and the Board of Supervisors to purchase two tax-defaulted parcels located within the city, and the status report on using volunteers for code enforcement.

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Emeryville resident John Nady and his attorney, Frederick Schrag, appeared before the supervisors Tuesday to ask for the opportunity to appeal the decision, which the Lake County Planning Commission handed down in May.

Planning staff had interpreted county code to suggest that the commission's decision to require Nady to do a focused environmental impact report (EIR) to look at archaeological and environmental resources couldn't be appealed to the Board of Supervisors.

Senior Planner Emily Minton told the board that Nady applied for a grading permit to build two residences and related improvements on Rattlesnake Island, a 57-acre island off of Clearlake Oaks.

The commission recommended a mitigated negative declaration be prepared. After reviewing the reports and hearing more than four and a half hours of public testimony, the commission determined the focused EIR was needed at a May meeting. Nady then appealed, Minton said.

“It is our opinion that local codes do not allow the decision of the planning commission to require an EIR to be appealed,” said Minton.

County Counsel Anita Grant said planning staff conferred with members of her office on the issue. She said the sole issue for the board to consider Tuesday was whether or not the EIR is a final decision or can be appealed to the board.

The discussion also revealed vague or conflicting parts of county code that led to the confusion over the language.

Supervisor Rob Brown said he didn't want to see the board give up the right to hear appeals, but worried that the board may not be able to hear the matter due to the rules.

Schrag argued that it was within the board's jurisdiction to hear the appeal. If boar members found it wasn't, the board wouldn't be able to correct the commission's errors, he suggested.

It also would leave Nady with the only option but to sue, said Schrag. “That would not be in the interests of the county or Mr. Nady.”

Schrag attempted to go through a history of the project but Board Chair Anthony Farrington cut him off. “I want to hear your legal arguments,” Farrington said.

When Schrag reiterated that Nady would have to sue if the board didn't hear his appeal, Brown challenged him.

Suing the county, Brown said, could mean a lot of different things. “If you think you're going to go and sue for a million dollars or whatever, we can't stop you from that.”

Schrag said that a lawsuit would be an unnecessary delay. “Mr. Nady has already been delayed six years on this project,” he said. “It's a waste of time and resources.”

Brown replied that it wasn't in the county's best interests for the five board members to succumb to a lawsuit threat.

Schrag said he wasn't threatening them, only telling them it would force Nady to a decision. Supervisor Denise Rushing pointed out that Nady had another option – he could do the focused EIR.

Farrington said if Schrag was going to threaten litigation, it would trigger another process and result in the board going into closed session.

Like Farrington, Brown said he wanted to hear Schrag's arguments. “Move on without bringing the lawyer stuff in here,” Brown said, otherwise the conversation would end.

Community Development Director Rick Coel explained during the meeting that the planning commission didn't deny Nady's grading permit request, but wanted the focused EIR completed before deciding on the grading permit.

Different sections of the zoning ordinance conflicted on the issue of which bodies make the final California Environmental Quality Act (CEQA) decision. While the language said the commission's decision was final, Schrag compared that to a superior court's ruling being final, but still subject to appeal to a higher court.

“It's up to you to decide what's final in this context,” he said.

During the discussion Brown noted that private property rights are important. “Staff has always allowed for and encouraged the appeal process,” he said, adding that he believed there needed to be room for flexibility.

Coel told the board that this was probably the third time in 20 years that the commission had asked for a focused EIR. He said such a request had killed two previous projects.

Rushing said she was struggling with the matter, because she felt the planning commission was asking for the EIR information to make a decision.

But ultimately the matter hinged less on the information requested and more on whether the board could, and would, hear the appeal itself.

After nearly an hour and a half of discussion, the board voted 4-1, with Rushing voting no, to hear the appeal. County planning staff must now prepare a report to bring back at a later date as part of the appeal hearing.

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