Sam Spiewak
August 3, 2006
California’s Attorney General filed a claim against Sonoma
County last Tuesday to get back some of the $12.9 million owed
to the state for the construction of the Spud Point Harbor in
Bodega Bay.
“Our department has filed an administrative claim against
the county to get the money they owe,” said an official in
the State Attorney General’s office who requested anonymity
because he is not allowed to discuss ongoing litigation.
“Now Sonoma County goes about the business of deciding how
they want to respond to that claim. If they reject the claim,
we huddle up and decide what we want to do.”
The origins of the debt
Located off Highway 1 in Bodega Bay, Spud Point has 244 slips,
a fuel station, and harbors vessels up to 80 feet. The
construction of the once state-of-the-art marina was completed
in 1985 using loans from the state’s Board of Boating and
Waterways and the state’s Coastal Conservancy. The
architects of the deal believed that, between berthing fees
and the sale of ice and gasoline, the $6.2 million in loans
– plus interest – could easily be repaid over the 30 year
term. Their optimism was fueled, in part, by record fish
catches during of the late 1970s, when the value of the catch
reached $15 million annually and boat berths were at a
premium, and by rosy predictions on groundfish stocks made by
the Pacific Management Fisheries Council; those predictions
later turned out to be based on flawed scientific data.
Even as construction of the marina began in 1983, the
300-strong fishing fleet in Bodega Bay was talking of boats
repossessed and bills unpaid. That year, stiff competition
from Alaskan and Oregonian fleets, a reduced salmon fishing
season, and an El Niño – the warm weather phenomenon that
drives salmon into colder waters that are too deep to fish –
resulted in a meager catch of 2.4 million salmon in
California.
With their livelihood in jeopardy, many fishermen left Bodega
Bay. Payment on the debt for the construction of Spud Point
continued until 1992, but income from the marina was
insufficient to continue paying off the loan. No payments have
been made since that time despite a detailed efficiency study
and attempts to increase revenue and lower expenses.
“The berthing rate has been increased at a maximum 6 percent
annually,” said Mary Burns, director of Sonoma County
Regional Parks. “We’ve tried to take bids for the
operation of the boatlift and we didn’t get anything
feasible. At one point, Boating and Waterways agreed to take
Spud Point back, and decided they could not do that
legally.”
“We have been spending into a fund that will quickly reach a
zero balance within a couple years,” she said.
The unpaid premium on the loan is now $5.9 million, plus
unpaid interest of $7 million, for a total debt of $12.9
million.
Flawed data
Spud Point’s financial problems were caused, in part, by a
historic transition in the management and administration of
West Coast fishing.
The Magnuson Act, signed into law in 1976, empowered the
National Marine Fisheries Service to manage West Coast fishing
waters. NMRS set up a system of management councils. The
Pacific Management Council was given jurisdiction to monitor
and manage fish stocks on the West Coast.
At that time, groundfish (about 82 species that live near the
bottom of the ocean including bocaccio, sole, Pacific whiting,
and lingcod) were only lightly fished. As part of the Magnuson
Act, the Pacific Management Council increased catch levels of
this fish, offered fishermen loans, and encouraged West Coast
fishermen to catch more groundfish. This led to over fishing,
according to scientists.
“It was incorrect to think that the groundfish catch rates
fishermen were making in the early 80s could be sustained in
the long term,” said Stephen Ralston, Ph.D., a research
fishery biologist with the National Oceanic and Atmospheric
Administration.
“The management of groundfish by the Pacific Fisheries
Management Council was conducted based on experiences gathered
from other fisheries. We took those harvest rates and applied
them to the West Coast, but we were very unlucky because the
groundfish stocks could not tolerate that high a harvest
rate.”
“The managers accepted the flawed information the scientists
gave them,” said Ralston. Declining groundfish stocks
combined with a drought and federal restrictions on salmon
fishing led to low catches and low revenues for the fleet at
Spud Point.
What now?
“I prefer not to come up with solutions in the courtroom,
but it looks like that’s where it’s heading,” said
Burns, of Sonoma County Regional Parks. The claim filed by the
Attorney General names the Sonoma County Board of Supervisors,
including past members of the Board, the County Manager, and
the Director of Finance.
“Despite requests for payment, the County has not made any
payments of these amounts and, apparently, refuses … despite
a clear and unquestioned legal obligation to do so,” reads
the claim.
With the West Coast fishing fleet in a declared state of
emergency due to restrictions placed on salmon fishing, Sonoma
County received a bill for $8,149,723.40 last month.
“There is simply no chance that the marina is going to pay
off that debt,” said Donald Peterson, one of the architects
of the original deal to build Spud Point and now a lobbyist
for Sonoma County.
Last year, Peterson pushed for a bill that would have
authorized the state’s resources agency to use $25 million
in Sonoma County property to repay the debt. The bill, which
failed to reach a vote, would have settled the debt, but would
not have restored the money to the Harbors and Watercraft
Revolving Fund from which the loan was originally paid.
“We tried to get a legislative fix for this issue,” said
Bob Deis, Sonoma County Administrator, “and we’ve been
unable.” Boating and Waterways has argued in the past that
the debt should be paid out of the county’s general fund.
“The feeling on the part of county is the debt payback is
limited to the proceeds from the Spud Point Marina,” said
Deis. “Our interpretation is based on legal council.”
“It’s been a standoff between the county and the state,”
said Mike Reilly, Sonoma County District Five Supervisor,
whose area includes Bodega Bay. “Each year, the marina has
been doing the maximum increase in terms of dock fees, and it
really squeezes commercial fishermen when they don’t even
really have a season this year. It’s borrowing Peter to pay
Paul.”
The failure of Spud Point to meet its financial obligation is
the result of federal and state mismanagement of the fishery,
said Zeke Grader, executive director of the Pacific Coast
Fishermen’s Association, a San Francisco-based organization
that represents 14 commercial fishing groups in northern and
central California.
“Spud Point should be prospering but isn’t because of two
federal actions and one state action,” he said. Grader
pointed to the federal government’s mismanagement of the
Klamath River, overly optimistic projections on groundfish
prior to the construction of Spud Point, and California’s
failure to institute policies protecting local crab for local
fisherman.
Grader rejected the idea of paying off Spud Point’s debt
using some of the $2 million in disaster relief recently
obtained for salmon fishing communities by the U.S. House of
Representatives.
“That money is suppose to allow people to keep their
businesses going,” he said. “Nobody is hurting if Boating
and Waterways isn’t paid back right away. Nobody is going to
lose his or her home. We’d like to see a lot of that money
used to fix the Klamath.”
“As we look at the proposal to give assistance to the salmon
fishing industry,” said lobbyist Donald Peterson, “this is
an opportunity to get some recognition of the fact that the
marina hasn’t been able to meet its obligation. We certainly
will, on behalf of the marina, try to make that point when the
legislature is back in session.” |
+++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
NOTE: In accordance with Title 17 U.S.C. section 107, any
copyrighted
material herein is distributed without profit or payment to
those who have
expressed a prior interest in receiving this information
for non-profit
research and educational purposes only. For more information
go to:
http://www.law.cornell.edu/uscode/17/107.shtml
|
