Rails, trails, bankruptcy and dope. It was a topsy-turvy year in Humboldt County — a wierd, shook-up year now spilling its contents into the next.

The politically active portion of the community is still divided along lines that were drawn almost 40 years ago, when the first hippies started showing up in Arcata and Eureka and Garberville. The age-old struggle for power between the two creaky old battalions, each of which grows more tedious by the year, hasn't really gone away. In 2007, though, the lines got blurry.

More and more people seemed able to shake free of the tribal impulse that finally overwhelmed Humboldt County politics with the Maxxam-sponsored recall attempt against District Attorney Paul Gallegos in 2004. They didn't instantly run to the barricades to defend themselves against the imaginary monsters that were said to populate the other side of the aisle; they put thought into the future, and the conclusions they reached were not predictable. Strange bedfellows were everywhere. It helped that it was an off year for elections (with one important exception). But the key thing is that the ground everywhere seemed to shift beneath the feet. Players that once moved mountains suddenly evaporated overnight. Brand new issues sprang to the fore. Allies turned upon each other, perhaps because they had nothing better to do. People representing interests once thought irreconcilable sat down at the table.

Thesis, antithesis, synthesis. The county hasn't reached that third stage; it's not quite ready to move on to the next new thing. But the items we place in the time capsule this year are cracks in the wall. If you're eager for progress, if you're weary of the same old debates between the same old people, if you hope that Humboldt County's children will have better things to do than reenact their parents' fights and prejudices, then this year you should have plenty of reasons to celebrate.

1. Bankrupt

It was both tragedy and farce, and it recast 20 years of Humboldt County history.

No one can yet be certain whether Houston's Charles Hurwitz and his Maxxam Corp. — the central figure in the area's politics for the last two decades — have permanently exited from the stage. Key judicial decisions have yet to be rendered, and though things are looking pretty grim for Hurwitz right now the crafty son-of-a-bitch may yet have cards up his sleeve. If he does lose, though, there are very, very few people who will be sorry to see the back side of him. That's the thing that changed.

The Pacific Lumber Company, a 150-year-old institution that Hurwitz acquired in 1986, declared bankruptcy in January. The '80s-era business model he had pursued throughout his ownership of Pacific Lumber — draining the company of equity while simultaneously loading it with debt — finally had its inevitable consequence. No one was surprised: The company had been attempting to wholesale property for a couple of years in an attempt to meet its mortgage. But the bitterly satirical, fraud-filled manner in which the bankruptcy played itself out left many stunned, even considering that it was Hurwitz who invented it.

It turned out that the company had been preparing itself for bankruptcy for some time. In 2006, it opened an empty office in Corpus Christi, Texas, and called it the home of "Scotia Development," an imaginary business and also the home of Maxxam's bankruptcy attorneys. When it came time to throw in the towel on Pacific Lumber, Hurwitz folded Palco and its various sister companies into "Scotia Development." This would allow the case to be made that the bankruptcy should be heard in Texas rather than California. And the Corpus Christi judge into whose lap the bankruptcy had fallen went along with the argument.

Things pretty much followed in that vein for some time. The company several times asked the bankruptcy court's permission to continue to pay its executives top dollar. Sometimes it won, sometimes it lost. For months it delayed filing its recovery plan. When it did, it turned out that the plan called for the mass subdivision of 22,000 acres of Humboldt County land into a chi-chi housing development it called the "Redwood Ranch." Recognizing this as impractical, the judge ordered all the parties — the company and its creditors — into mediation, which has just ended in failure.

There were a couple of side notes. Former Pacific Lumber executives John Campbell and Tom Herman, both of whom serve in government, are now being investigated by the Fair Political Practices Commission for their continued financial relationships with Pacific Lumber. And this week District Attorney Paul Gallegos is finally set to proceed with an appeal aimed at reviving the massive fraud suit he brought against the company in 2004. Once, the Gallegos suit turned the county on its head. Now it's an afterthought.

Waiting in the wings are the holders of the so-called "timber bonds," who own by far the great majority of the company's debt and are in pole position to take over if Maxxam fades away. These bondholders are made up of most of the big Wall Street names — Citibank, Bank of America, J.P. Morgan, etc. What are their intentions? Local advocates of sustainable, community-based forestry believe they have the bondholders' ears. If so, that would pretty much mark the end of the Timber Wars. If not, the wars may go on forever.

2. Trail Uprising

The issue looks minor on paper and seemed to come out of nowhere, but in the middle of this year it exploded with undeniable force. People want their bike trails and they want them now, and they're ready to push just about everything else to the bottom of the list until the trails get built. They're fired up. Heaven help those who stand in their way.

The catalyst for this surge was a study that had been commissioned by a behind-the-scenes group of elected representatives and other interested parties. The study, undertaken by an out-of-town consulting group and released in June, gave a range of options for building a multi-use pedestrian and bike path between Eureka and Arcata. One option said that such a trail could be built for about $5 million if the North Coast Railroad Authority, a public agency, consented to turn over its decaying tracks, which haven't been used for 10 years, to the trail effort. Another option involved expanding and rebuilding the track between the cities, so that the trail could coexist with the rail, if it ever comes back. The price tag: around $31 million. The powers-that-be chose to pursue the latter.

The surging opposition to this decision was inspired by many disparate factors, and it manifested itself in many different ways. For one, the gap in McKinleyville's Hammond Trail was finally closed in the fall, and the trail instantly became the town's number one recreational facility and perhaps its most prized feature. People took notice. Skyrocketing gas prices made many look again at their bicycles as principal forms of transportation. A group of doctors came forth and forcefully argued for the proposed Eureka-Arcata trail's benefits to the general public health. Some folks took an economic standpoint, arguing that a functional trail was sure to be a greater boon for business than a non-functioning railroad.

The pushback came from the folks who have been trying, without success and without any sort of actual plan, to develop Humboldt Bay as a shipping port that can capture a slice of the North American trade with Asia. For the port to work, it was argued, it needs the railroad. Likewise, the railroad needs the port. Both projects carry price tags of unknown hundreds of millions of dollars, and there was no idea where the money would come from, but port-rail backers argued that the business boom that would result was worth the risk. Therefore, it was imperative to hold on to the moribund railroad assets.

One of the main people advancing such an argument, McKinleyville's Charles Ollivier, was defeated in his bid for reelection to the Harbor District by a 65-35 margin. His opponent, Pat Higgins, is a trail advocate. In southern Humboldt, longtime Fortuna leader Roy Curless barely eked a Harbor District victory against trail advocate (and political newcomer) Carlos Quilez, who had around one-tenth of Curless' campaign budget.

The situation at the turn of the year: Several agencies — not only the railroad authority and the harbor district, but also Caltrans — are desperately trying to deflect the trail insurgency, which seems to be growing stronger by the day.

3. Arcata Grows

Humboldt County has freaked out about the marijuana trade plenty of times in the past. But not in the last 10 years or so, and certainly not in the city of Arcata, whose nonsmoking populace generally takes a live-and-let-live view of the demon weed. But when a fire sparked by an indoor grow nearly burned down a rental home in September, the city suddenly awoke, as if from a stupor, and found that the green stuff had just about taken over the town.

It turns out that Proposition 215, the measure that legalized marijuana for medical use that California voters passed in 1996, had some unintended consequences. Now it's estimated that there are literally hundreds of homes in the Arcata city limits that are given over to the semi-legal production of marijuana. No one lives in many of them. There are four medical cannabis clinics in town, where anyone with a doctor's recommendation — in practice, anyone who wants one — can walk in off the street and purchase bud. Three of those four clinics lease their space from some subsidiary of Danco, the town's most prominent developer. And there have since been more fires.

Humboldt State University President Rollin Richmond has long been the lone dissenting voice in city policy concerning tolerance of the herb; he feels that it gives the city a bad image and thinks that it dissuades new students from attending his school. But now there are whole slews of concerned citizens, and if they're not yet ready to adopt a no-tolerance policy they're at least wringing their hands.

The situation is complicated by the fact that marijuana is undeniably big business, and everyone is getting at least a slice of the pie by one means or another. Still, there is broad consensus that things need to be reined in somehow. Some have proposed shooing growers off into industrial areas. On Wednesday, Dec. 19, the City Council was considering a measure that would limit indoor medical marijuana grows to one patient per house. Arcata being Arcata, some have proposed that the city should build its own massive indoor weed facility, powered by environmentally friendly electricity, which it could then sharecrop out to its citizens at ultra-low rates.

All told, it's a fine line the city has to walk if it hopes to simultaneously crack down and maintain its image of itself. And the feds are waiting in the wings, eager for their cue. Given the pace of city government, it will be a miracle if it has time to accomplish anything.

4. The Klamath Settlement

As they have done in years past, the tribes along the Klamath River took their argument on the road in May, hoping to make the case in the backyards of the people who hold the fate of the river in their hands. This time they headed to Omaha, Neb., where they sought to make their presence known at the annual shareholder meeting of Berkshire Hathaway, the holding company chaired by billionaire financial celebrity Warren Buffett. In 2005, Berkshire Hathaway acquired PacifiCorp, an Oregon-based power company. And with PacifiCorp it acquired the four electricity-producing dams on the Klamath River, which are one of the key factors in that complex river's declining health.

The tribes hoped to get a meeting with Buffett, to tell them about the impact the massive 2002 Klamath Fish Kill and its many lesser-known counterparts have had on their way of life, and also on the livelihood of the region as a whole. Buffett refused. From the floor of the shareholders' convention he told questioners that he would follow the lead of the Federal Energy Regulatory Commission, the agency that licenses the dams. Those licenses are up for renewal.

There was a lot of news on the Klamath front. In June, the Washington Post published a series confirming what everyone sort of suspected — that Vice-President Dick Cheney had directly ordered the events that led to the fish kill. It was Cheney's office that sent out the word to federal regulatory agencies that they must come up with a rationale for continuing to provide water to upstream farmers in Oregon's Klamath Basin, a key Republican stronghold in a swing state. Low flows left salmon to rot downstream.

More important, though, were the Klamath settlement talks, which have been occurring behind the scenes for several years. All the stakeholders along the Klamath have been invited to participate in the talks — tribes, fishermen, farmers, environmentalists. They're talking about sharing the water and about the PacifiCorp dams. The talks happen behind closed doors and under a nondisclosure agreement, so it's difficult to determine what exactly is happening. People wondering about them are left with the pessimistic reports of groups who have walked away. But the remaining delegates have been reporting progress on an agreement that would be satisfactory to all, and which would be taken to Congress for action. If true, this is an impressive accomplishment for people who were at each others' throats only a few years ago.

The issue of the electric dams proceeds along its own path. Though the settlement group is said to favor their removal, and though FERC has acknowledged that it would be cheaper to remove them than install the fish ladders that regulatory agencies are demanding, a report issued in November signals that the commission is inclined to allow them to stay there, polluting the river for another 50 years. Unless the federal government comes up with some incentives, it could be a deal-breaker.

5. The New EPD

When the City of Eureka hired its new police chief in March, it knew that it was hiring a reformer. Garr Nielsen had spent almost his entire career in the Multnomah County (Oregon) Sheriff's Office, where he had risen to the rank of captain. Multnomah County is widely known to be one of the most forward-thinking police agencies in the nation, at the vanguard of community policing and officer educational standards, and Nielsen championed the philosophy of his agency wholeheartedly. The city needed someone with those kind of credentials to lead a police force whose reputation, never stellar, had plummeted to the bottom in recent years.

Nielsen inherited a police force that had been responsible for five fatal shootings in the previous year and a half, some of which were and are extremely controversial. The Eureka Police Department's morale was at rock-bottom. Pay was substandard. It was unable to recruit and retain officers. Now the situation is somewhat different. Though there is much work still to be done, the new chief has at least managed to rehabilitate trust in the agency.

Three institutional reforms are worth noting. From the moment he hit the ground, Nielsen embraced his role as a public servant. He pledged to hold himself and his department accountable to the citizenry, and he seemed to have a broader definition of who qualified as a "citizen" than administrations past. Then, in September, he announced that he would in future ask the California Attorney General's Office to review officer-related shootings in place of the local Critical Incident Response Team, which is composed of the EPD's brother officers. Finally, he said that he would like the county to disband the department's SWAT team and institute a county-wide, multijurisdictional SWAT force.

He faced his first test in August, when a homeless man named Martin Cotton died in jail after a confrontation with EPD officers. Though the case remains murky, Nielsen seemed to do his best to tell the public what he knew. He held an hours-long town hall meeting in the wake of the death. And he managed to stand by both the public and his officers when he urged forward motion on the long-delayed Cheri Lyn Moore case, in which EPD officers last year stormed the residence of a mentally ill woman and ended up shooting her dead. A grand jury indicted two EPD commanders in the case, which is now scheduled to go to trial early next year.

6. TPZ Backlash

The Humboldt County Board of Supervisors probably didn't see it coming. What they wanted to do was grab at a chance to bury the Maxxam Corp., which, apart from everything else, had deeply insulted county government with the "Redwood Ranch" proposal it had floated down in Corpus Christi. (See above.) The supes probably figured — rightly — that no one would leap to Maxxam's defense. But then the whole thing took on a life of its own.

Supervisors learned about the "Redwood Ranch" proposal in early October, right after it hit the papers. The Corpus Christi bankruptcy court was scheduled to hear the proposal a couple of weeks later. With so short a window, the county rushed an emergency item onto the next meeting of the board — a moratorium on home-building in lands zoned for timber production. This move, it was argued, would send a message to the bankruptcy court that the Redwood Ranch would never fly in Humboldt County. Maxxam's recovery plan, therefore, was a dead letter. The moratorium passed with the necessary 4-1 majority, and in fact the action had its intended effect.

But the moratorium represented a departure in the way the county had regulated its timberlands heretofore, and suddenly some people argued that the change should become permanent. It turned out that other counties regulate home-building in timber lands much more strictly than we do here in Humboldt County, requiring onerous permitting or banning the practice altogether. Here, the right to build a home had always come with title to a timber parcel. For various reasons — prevention of sprawl, more equitable taxation — some of the people on the left side of the aisle argued that Humboldt should move to clamp down. And that with the moratorium in place, it would pay to act as soon as possible.

The backlash was immediate and fierce, and it became perhaps the only mass movement with a conservative tinge in recent years. Certainly it became the only one that was an unqualified success. When it came time for the county to extend the moratorium, it declined to do so. And then, last week, the county stopped work on a permanent ordinance that followed in the moratorium's footsteps, opting instead to roll the question into its general plan update, which has been in the works for years.

The county's sobering-up on the issue undoubtedly had something to do with threatened lawsuits, and perhaps with county staff's alleged misreading of relevant law. But it's probably safe to say that wiping hundreds of millions of dollars in Humboldt County property values off the books with a stroke, after only a few weeks of study, had something to do with it as well.

7. Bubble Bursting

Someday soon, the Humboldt County real estate industry should hold a summit to try to work out its position. Does it want home prices to fall, or does it want home prices to rise? As the market inflated in the past few years, the industry became greatly concerned about the question of housing affordability. In the last few years, the percentage of residents able to afford the median-priced home on the market has hovered in the low teens. Some took this shocking figure as a call for a dramatic uptick in new construction — increase the supply to match demand, they said, and home prices will drift down until the average citizen may again afford to buy.

But this year the market stalled by itself, and for entirely different reasons. When that happened, it turned out that many real estate people didn't much care for falling prices after all.

In fact, it should always have been obvious that Humboldt County is not as isolated as we sometimes believe. The local real estate bubble precisely paralleled the national one, and when the national market went into crisis mode the local one did too. Prices haven't fallen dramatically yet — though their fall is more dramatic when dollars are adjusted for inflation — but still, the boom has clearly ended. The sellers' market is dead. There are more homes on the market than there have been in ages. Homes stay on the market for a lot longer before they sell. No longer do buyers bump up their bids for a better shot at their house. Now sellers drop prices to attract bids.

This state of affairs has inspired a bit of panic. When Erick Eschker, an economics professor at Humboldt State University, published a paper in October that by his analysis Humboldt County home prices looked due to drop by as much as 40 percent (in inflation-adjusted dollars) over the coming years, some real estate professionals attacked his conclusions. Real estate, they said, has always been a sound investment, and though the market had slowed there was no reason to think that it would ever drop. But then the Wall Street firm of Goldman Sachs published a paper on the California market as a whole, and their conclusion mirrored Eschker's.

In and of itself, the collapse of the bubble will not only have profound effects on the local economy. But it also deflated much of the impetus behind the earlier drive to open the county to expanded development. Look for that debate to come back next year, as county government puts its final touches on its new general plan.

8. The Push

Leave aside all the serious issues and political implications for the moment and think about the sheer, visceral, tabloid power of the thing. An upper-crust reception for visiting dignitaries from the California Coastal Commission at Avalon. Local power players turn out to greet the visitors. The wine and hors d'oeuvres flow. And then, at one edge of the party, local kazillionaire bull-in-china-shop Rob Arkley becomes enraged upon meeting, for the first time, Eureka City Councilmember Larry Glass, who has spoken critically of Arkley's multimillion dollar Marina Center development proposal and once gave away "Anti-Arkleyville" stickers in his record store.

Part of the sensational appeal of the incident is due to the fact that no one apart from the two principals is quite certain about what exactly took place at the Avalon on the evening of Sept. 5. Both sides agree that Arkley took the opportunity to excoriate Glass over the Arkleyville stickers; he apparently said that the stickers amounted to an attack on his two daughters. The stories diverge quickly from there. Glass said that Arkley threatened to destroy him if he used his seat on the City Council to vote against "his project." He also said that Arkley physically shoved him twice, hard.

Though everyone in town was talking about it first thing the next morning, most everyone inside the rather small restaurant said that they didn't witness the shove. Only one witness stepped forward, at least to the media. Arkley's lieutenant, Randy Gans, was with his boss at the time; he told the Eureka Reporter (Arkley's newspaper) that there was no physical contact between the two men. Glass demanded an apology. He received a note from Arkley containing the words "my apologies," but Glass deemed it insufficient, as it did not apologize for the alleged threats or the alleged push. After considering the matter over the weekend, Glass, who initially said that he would not press the matter, changed his mind and filed charges with the Eureka Police Department.

California law treats the threatening and/or assault of a public official as a pretty serious matter, with a couple of statutes on the books specifying a jail term of up to a year and/or a $10,000 fine. When the police investigation began, things got even weirder. Arkley brought in a professional media relations expert from the Bay Area to do a tour of Humboldt County. (The man, Steven Glazer, also happened to be the mayor of the city of Orinda, and had worked in some capacity on the Marina Center project.) The EPD undertook an investigation of the incident and forwarded the results to District Attorney Paul Gallegos; Gallegos, citing personal connections to both men, forwarded the matter on to the California Attorney General's office for a decision on whether or not to prosecute. And there the matter languishes.

9. Reggae War

Scratch a hippie and you'll find a capitalist. Southern Humboldt erupted in fratricide this year, as the Mateel Community Center and its former partner, People Productions, battled over ownership of the annual Reggae on the River festival, a multimillion dollar production. The fracas, which began last year, truly blossomed in 2007, and it more or less ripped the SoHum back-to-the-land movement (and its descendants) in half.

The war took place on several fronts, but the key battle was for the hearts and minds of people who like to place great stock in the concepts of unity, community and nonaggression. Critics of People Productions painted the struggle as a hostile corporate takeover of Reggae by the people who for years had contracted to manage it. Critics of the Mateel tried to make the case that the community center, a non-profit, had become bloated and fallen into sinister hands, which frittered away the community's Reggae profits on salaries for unnecessary positions. Thus did each side try to justify its actions in terms that their constituency holds dear. Camps formed; neighbor turned against neighbor; the newspapers, the blogs and local public radio station KMUD were flooded with vitriol. Things were said that couldn't be unsaid, to borrow former Mateel board member Barbara Truitt's memorable phrase.

The Mateel, which owns the Reggae on the River trademark, canceled its contract with People Productions late last year; in January, it announced that it had hired Boots Hughston, a San Francisco producer with Humboldt roots, to put on the festival in People Productions' place. For a few weeks, it seemed like the war had ended and everything would proceed apace.

But People Productions fired back with a bold counterstrike in February. The company unveiled plans for something it called "Reggae Rising" — a festival scheduled for the same August weekend as Reggae on the River. Also, Reggae Rising was scheduled for the same venue — the Dimmick Ranch, on the Mendocino/Humboldt line near Richardson Grove. It turned out that ranch owner Tom Dimmick had sided with People Productions in the fight, and pointed to a clause in his contract with the Mateel to argue that he did not need to work with the Mateel if People Productions didn't produce the show.

The battle was enjoined in the courts and at the county planning commission, the lead agency charged with permitting the festival. People Productions and "Reggae Rising" won all the key skirmishes. Reggae Rising went ahead; Reggae on the River was canceled. The Mateel scaled back its budget dramatically. But the principal issues between the two sides have yet to be litigated, and the lawsuits are still very much active. Things have been fairly quiet in SoHum lately, but everything will surely reignite once court is in session.

10. Hobart and Bill, R.I.P

Society calls upon certain individuals to serve as the embodiment of an idea – a nation, a community, a way of life. They are our living icons. We reduce them to one dimension, make caricatures of them, sap them of their humanity, so that in our dark hours the simple thought of them will give us hope and assure us that we made all the right choices. The fact that they still stand means that our ideals still stand.

Two such individuals died in 2007.

In many ways, Hobart Brown was an odd mascot for Humboldt County's first wave of freaks. He was a cantankerous, conservative Republican. He never stopped trying to figure out ways to cash in. He was forever engaged in petty bickering and financial intrigue with those close to him, and several times he came close to destroying his creation. But the annual Kinetic Sculpture Race soldiers on, thanks to Hobart and also despite him. When he died in November, the Kinetic Universe came out for a memorial in strength, with the funny hats and wigs and body paint and silly costumes — "adults having fun so children want to get older," in the words of the late Glorious Founder.

Bill the Chimp was the preeminent citizen of old Eureka. Generations came and wondered at him through the bars of his cage. Way back in the 1950s, the children of Eureka gathered their pennies to rescue him from the depredations of life in the circus; in exchange for this, he would delight and instruct those children, and their children, and their grandchildren. That was supposed to be the deal. When we became adults we laughed at his defiance, his shit-flinging, because we admired his spirit and we knew he could never win. Occasionally he would bring national attention to our town with his art, and we were proud. He grew old before our eyes, and in June he died.

Now that Bill is gone, it's possible to face the terrible truth of his life: It was all a mistake. He never should have been stolen from Africa, never should have been conscripted into the circus, never should have been incarcerated in our zoo. Those bright-eyed, penny-gathering children of the post-War era were misled by people who should have known better. And our love deepens for those children, and for Bill, now that we don't have to keep up the illusion anymore.