We sit at our desk, pushing around the scraps of paper that have accumulated here. We read them like tea leaves. And we have no way of saying for certain, but the strongest theory that arises is that the Houston-based Maxxam Corp., whose local affiliate, the once-proud Pacific Lumber Co., which has been in bankruptcy court since January, is preparing to go nuclear.
If we're correct, all the mill closures and layoffs and shutdowns Humboldt County has suffered through over the past couple of years are going to seem like a sunny day at the park. Indeed, this is the very thing that everyone -- enviros and timber workers alike -- have feared from the first.
The scantiness of the information makes it too early to call the play. Hear us out, though.
One. A few weeks from now, on Sept. 18, Pacific Lumber and its sister companies are due to file a reorganization plan with the Corpus Christi-based judge who presides over the omnibus bankruptcy case, which comprises Pacific Lumber and its local sister companies, Scotia Pacific and Britt Lumber. The reorganization plan will outline Pacific Lumber's proposal to pay off its debt and become a solvent company once more.
Two. As Daniel Mintz reported on the KMUD News Monday, Tom Hofweber, a supervising planner with the county's Community Development Services Department, last week delivered a report to the Humboldt County Planning Commission. Hofweber told the commission that his office had received visits from appraisers connected with Pacific Lumber and the bankruptcy case, and that the direction of their conversation was eye-opening.
"The questions we have gotten from appraisers for the Palco lands -- they weren't asking us much about how good the timber was on those properties, they were asking how many residential lots can we subdivide those lots into," Hofweber said. In his report, Mintz went on to note that Elk River resident Kristi Wrigley, who has opposed Pacific Lumber logging practices in her neighborhood, had challenged Planning Commission Chair Tom Herman to refrain from participating in the discussion, as he is a former Pacific Lumber employee who has since done legal work for the company. Mintz reported that Herman declined to respond.
Three. However, Herman's relationship with Pacific Lumber was closer than Wrigley knew. One week earlier, on Aug. 9, the company petitioned the bankruptcy court to allow it to re-retain Herman and his firm, Barnum & Herman, which specializes in real estate law. (In passing, we'll note that in his sworn statement to the bankruptcy court, Herman wrote that "Neither I, the Firm, nor any partner ... holds any interest adverse to the Debtors [Pacific Lumber] or their estates in matters upon which the Firm is to be engaged.‚Äù And we will reiterate that he is chair of the Humboldt County Planning Commission.)
At the same time, Pacific Lumber petitioned the court to allow it to re-retain the services of Eureka firm Mitchell, Brisso, Delaney & Vrieze -- the outside firm that Humboldt County government often hires to fight its legal battles. True, Mitchell, Brisso has also done plenty of work for Pacific Lumber in the past, but one wonders what uses it has for the firm in the future. The bankruptcy court allowed Pacific Lumber to retain both the local firms.
Starting to add up? We'll see for sure next month, when the company files its reorganization plan, but for now there's a reasonable conclusion that can be drawn. That is: The company's solution to its problems will be to sell off some, most or all of its 200,000 acres of Humboldt County timberland for residential development. Humboldt County would bitterly oppose such a move -- therefore, it makes sense to hire an attorney who knows the county's land use codes better than any other. And it also makes sense to snap up the county's preferred firm before the county does.
This is the Maxxam "end game‚Äù that the smart enviros have envisioned for some time --divvying up and suburbanizing Humboldt County's timberlands, all but taking them out of production. And as lots of people in and around Scotia will tell you, those smart enviros sure as hell knew what they were talking about.
And now fora railroad update.Since we published our cover story on the issue last month ("The Squeeze," July 5), interest in the North Coast Railroad Authority and the associated plan to transform Humboldt County into a waypoint in global trade has blossomed. Today's forecast? Things are going to get hotter still. Next month, the Humboldt Bay Harbor, Recreation and Conservation District is scheduled to release a study that should shed some light on the benefits and limitations of a local shipping industry. And there's an election coming up. On Nov. 6, with two seats in play, voters will either confirm or reject the Harbor District's current bet-the-farm strategy to dramatically up the flow of goods in and out of the bay. The campaign should begin in earnest next Wednesday, when insurgent SoHum candidate Carlos Quilez holds a noontime press conference on the Eureka Boardwalk.
As for the railroad -- a critical component of the goods movement plan -- things continue to get weirder. The public agency in control of the long-moribund line is finally flush, having convinced Sacramento of its bright future with the help of some dubious data. Thus, work to open the south end of the line, down in Sonoma and Marin counties, is steaming ahead. But the mutual mistrust between the railroad authority and the County of Marin deepened last week, when the authority unilaterally kicked the two Marin members on its board of directors out of a meeting.
On Wednesday, Marin County Supervisor Judy Arnold and Novato City Councilmember Jim Leland had teleconferenced into the monthly meeting of the NCRA board of directors. At one point during the proceedings, Arnold and Leland were told that the board was going into closed session to discuss potential legal action, and that they would not be allowed to participate. Despite their protests, the phone line to Marin was cut. And when it was turned on again, Arnold and Leland were angry.
In the closed session, the remaining NCRA board members discussed the possibility that either Marin County, the City of Novato or both might sue the railroad authority. Both jurisdictions are home to citizens who are deeply concerned about the resumption of freight service through their neighborhoods. Reached at his Willits office Monday, NCRA legal counsel Christopher Neary said that his close examination of the meeting agendas of the Marin County Supes and the Novato City Council led him to the conclusion that the authority could be facing a legal threat from those quarters. Arnold and Leland could not participate in NCRA discussions about the threat, Neary said, because they would have a conflict of interest.
Hogwash, says Leland -- it's not up to the authority to decide who participates and who doesn't. By state law, public officials are responsible for their own conduct as regards conflict-of-interest regulations, and the fact that two agencies are at loggerheads in some respects doesn't necessarily imply that an individual with ties to both is conflicted. And this isn't the first time that Leland has found fault with the way that the NCRA conducts its business.
"Suffice it to say that the level of sophistication of how meetings work is very different down here than in Ukiah, at NCRA," Leland said.
Leland declined to say whether or not Novato was considering legal action against the railroad authority. For her part, Arnold said that Marin County has never considered a lawsuit against the railroad authority. She has filed a complaint about her forced recusal -- believe it or not, the Marin County District Attorney is now conducting a criminal investigation of the incident.