LUCERNE, Calif. – The Lucerne Area Town Hall plans a discussion on Thursday about what steps it can take after county leadership disregarded a resolution the group passed in January requesting that some of the funds from the sale of the Lucerne Hotel be used to benefit the community.
The meeting will take place at 7 p.m. Thursday, March 21, in the Rose Room at the Lucerne Alpine Senior Center, located at 10th and Country Club Drive in Lucerne.
Last month, the county finalized its sale of the Lucerne Hotel to the Earthways Foundation, an organization working with the Romero Institute to locate New Paradigm College at the historic, 90-year-old Lucerne Hotel. The sale price was $2.5 million.
The Lake County Redevelopment Agency purchased the Lucerne Hotel in 2010. A mix of county and redevelopment funds were used to buy and renovate the building.
Redevelopment funds came from tax increment revenue, drawn specifically from a portion of property tax in each of the areas where redevelopment took place, including the Northshore communities of Clearlake Oaks, Lucerne, Nice and Upper Lake.
The Lucerne Hotel had long been seen as a key Northshore asset. After its purchase, then-County Administrative Officer Kelly Cox had emphasized the desire to have the building's renovations be an economic engine for the area, and as a result it hired many local contractors – roofers, electricians including Bach Electric and a local window company to work on the building.
One of those was Lucerne Roofing & Supply, which reroofed the historic building. The company’s founder, Paul Parlee – who died earlier this year – told Lake County News in a late 2011 interview that he was grateful that county leaders agreed to keep the work in the county. He said he had 15 families depending on him, and the job helped keep local people employed in a time when he was down in job volume by 60 percent in the aftermath of the Great Recession.
The Lucerne Hotel and Holiday Harbor in Nice were the redevelopment agency’s key assets, and in early 2012, after the state dissolved redevelopment, the oversight board for the successor agency to the former Lake County Redevelopment Agency voted to transfer those properties to the county’s ownership, as Lake County News reported.
The county’s own Comprehensive Economics Development Strategy for the year 2016 identified the Lucerne Hotel as key to economic development on the Northshore. That plan laid out a goal of assisting “in the development of 13th Avenue into the commercial center of town with the historic Lucerne Hotel as the ‘anchor’ within the former Northshore Redevelopment Project
Area.”
However, that strategy appears to have largely been ignored since Carol Huchingson took over as county administrative officer in the spring of 2016.
Marymount California University left the Lucerne Hotel – its Lakeside Campus – abruptly in June 2017. After that, Huchingson pushed for the sale of the building – despite its importance to the town and over objections from the community – citing the county’s financial situation.
Town hall requests funds to help community
Hoping to at least recover some of the proceeds for needed improvements to Lucerne Harbor Park – which is serious need of dredging due to the build up of lakebed sediment – in January, the Lucerne Area Town Hall passed a resolution on Jan. 9, asking for some funds to be directed to benefit Lucerne.
Town Hall acting Chair Kurt Mckelvey said he first proposed the resolution at the June 2018 meeting, “and it took months working on it and advocating for it before it was passed by the council in January.”
The resolution cited as justifications “The will and the property tax increment dollars from Lucerne taxpayers paid to fund the former redevelopment agency which purchased the
Lucerne Hotel,” and pointed out that budgeted funds for dredging and improvements at Lucerne Harbor Park had been redirected to repair Holiday Harbor in Nice.
The town hall’s resolution noted, “Lucerne Harbor Park is among the county’s busiest boating parks,” and that “dredging the harbor would remove an impediment to the town’s
economic development, increase visitor use, and support the county’s economic engine of Lucerne.”
District 3 Supervisor EJ Crandell, who took office in January, was at the town hall meeting when the resolution was passed, and he was aware of the community’s concerns.
Mckelvey said he sent the resolution to Carolyn Purdy, the assistant clerk to the board, who said that she had forwarded the resolution to the Board of Supervisors for consideration.
“Beyond that, I haven't seen any formal acknowledgement or action by the County in response to the LATH resolution,” he said.
Town hall members said the goal was to have the request in front of the board before the Lucerne Hotel sale was finalized. The sale was completed at the end of February.
County Administrative Office, supervisors ignore request
Crandell told Lake County News he is advocating for the funds to be used for Lucerne.
However, Crandell appears to be getting pushback from the County Administrative Office.
Crandell said he told Huchingson that he had wanted $250,000 from the sale to go toward docks and dredging the harbor at Lucerne Harbor Park.
He said he knew he was going to be absent from the Feb. 12 board meeting and told Huchingson that.
Nevertheless, despite Crandell registering his concerns, Huchingson and her staff presented to the board a midyear budget review and associated adjustments at the Feb. 12 meeting that called for all $2.5 million from the purchase to be put into a reserve budget stabilization in Crandell’s absence.
The paragraph about the hotel sale proceeds included in the midyear budget review stated: “As your Board is aware, closure of escrow on the $2,500,000 sale of the Lucerne Castle is scheduled to take place soon. With this in mind, staff proposes placing proceeds from the sale into your Budget Stabilization Reserve and the adjustments you are considering today reflect that recommendation. You may recall that said reserve established by your Board for the purpose of incrementally reducing reliance on one-time funds to balance the budget. This reserve will be essential, as we weather the financial crisis we are facing in the years to come.”
“The reason for that would be to stabilize the upcoming budget deficits,” Deputy County Administrative Officer Stephen Carter told the board at that Feb. 12 meeting.
During the same midyear budget adjustment item, the board accepted Huchingson’s requested changes including an additional $60,000 for a building remodel including new cubicles and another $60,000 for two new vehicles for the Building and Safety Department, $40,000 for the recruitment of two executive staff members, $27,000 for leadership training for department heads and the supervisors, a $30,000 remodel for the Human Resources Department – which is under Huchingson’s management – and $50,042 for solar and parking lot seal coat for the Air Quality Management District.
With Crandell not there to advocate against the action to sweep the money into a reserve fund, the board accepted it.
Earlier in the same meeting, also at Huchingson’s urging, the board approved Sheriff Brian Martin’s proposal to restructure his administrative staff but denied his request for the salary adjustments to go with it, which would have cost an additional $2,000 a month, as Lake County News has reported.
Crandell said he was “a little upset” about how the budget matter was handled, especially since he said he had been forthcoming with Huchingson about his concerns.
“I’m still going to advocate for that,” he said of giving the community some of the funds for dredging, adding, “I do want them to have it.”
Lake County News asked Huchingson about the board’s action, and she confirmed that “as per board direction” at the Feb. 12 meeting “all of these one-time funds are being placed in our Budget Stabilization Reserve.”
When pressed further about the fact that the board ignored the Lucerne community’s request – at Huchingson’s own recommendation – Huchingson did not respond.
The Lucerne Hotel sale was the third major property sale on the Northshore since November 2017. In that month, the county sold off the former visitor information center in Lucerne for $263,500 and Holiday Harbor in Nice for $759,500.
As with the hotel sale funds, the county also refused to use any of those proceeds from the visitor center or Holiday Harbor for Northshore projects, instead absorbing the proceeds into the general fund.
The town hall’s leadership intends to discuss on Thursday what action it can take to ensure this recent request about the hotel sale proceeds and future requests are heard by the Board of Supervisors.
Email Elizabeth Larson at This email address is being protected from spambots. You need JavaScript enabled to view it.. Follow her on Twitter, @ERLarson, or Lake County News, @LakeCoNews.
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