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The Struggle Over Squaw Valley's Future

As the debate over incorporation gets heated, will it divide a community?
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Next Steps In Incorporation Process

Financial service firms have until May 21 to submit a bid for a comprehensive financial analysis of the town to LAFCO, which will select a firm at its June 11 meeting. Once a draft financial analysis is complete, which is expected to take three to four months, revenue neutrality negotiations between Incorporate Olympic Valley and Placer County begin. This is followed by a final financial analysis, public hearings, a LAFCO vote, and, if approved, the issue would go to voters next June.


“What does surprise us is the mystery of why Squaw Valley [Ski Holdings] is so negative to the incorporation process when we feel it could be beneficial. We believe it could make Squaw Valley a much better place. Think Vail, Aspen, Telluride — we have the revenue to be like that. This is not Stockton or Detroit.” ~ Fred Ilfeld, Incorporate Olympic Valley Chairman


“There is already enough divisiveness, I don’t want to add to that. But it’s important for us to ask the hard-hitting questions because this is a very serious matter.” ~ Andy Wirth, Squaw Valley Ski Holdings CEO and president


“Maybe I’m too idealistic, but Squaw has an opportunity to show the world how developers can work with the community at this level...This is a hugely historic time for all ski areas — I have gotten letters from people across the country in support of incorporation. There are a lot of eyes on us.” ~ Robb Gaffney, incorporation activist

When Squaw Valley Ski Holdings CEO and President Andy Wirth returned to work in December after three months in the hospital following a skydiving accident, his phone was ringing off the hook. Wirth said people were calling to convey one of three messages: welcome back, thank you for listening and revising the village development, and to express concern over the effort to incorporate Olympic Valley.

“For the past year and a half, we have been silent on the issue because we wanted to respect the diversity of opinion and citizens’ rights,” Wirth said. “A lot of folks didn’t understand our silence.”

Squaw Valley Ski Holdings is silent no more. Starting in April, the ski resort went on the offensive against Incorporate Olympic Valley (IOV), the nonprofit that has been working for the past year to turn the valley into a town. Wirth wrote a five-page letter to the Placer County Local Agency Formation Commission (LAFCO) outlining why the ski area is opposed to incorporation, and brought together a loose coalition of incorporation opponents into a group called Save Olympic Valley, which has taken out several full-page ads in local papers questioning the IOV proposal.

The incorporation movement has not been silent either. It just wrapped up a six-week crowdfunding campaign to raise $25,000, and “Squallywood” author and local ski icon Robb Gaffney, who is the face of IOV in the crowdfunding video, publicly resigned from his 20-year relationship with Squaw Valley via Facebook. His post received 270 likes.

While Squaw says it is exercising its right as a major landowner to question the feasibility and appropriateness of incorporation, incorporation proponents say the ski area is conducting what amounts to a negative smear campaign. Some worry that as tensions between the ski area and IOV mount, and as more people appear to choose sides, the war of words could threaten to divide a community and hinder the future of a valley that is on the brink of major change.

FUELING THE FIRE

Since the incorporation movement began in early 2013, relations have largely been calm between IOV and Squaw Valley Ski Holdings. But tensions started heating up at the end of March, when IOV launched its Indiegogo fundraising campaign featuring a two-and-a-half minute video called “Squaw Valley: Help Decide Its Future” with Gaffney as narrator. According to IOV, it’s the first time that crowdfunding has been used to create a town. This money will be in addition to the $87,000 the group has raised over the past year, primarily through donations.

“We wanted to reach a larger audience to raise capital,” said IOV board member Jamie Schectman. “It helps raise awareness about the movement and what it’s all about.”

Even though the campaign failed to raise $25,000 by the May 3 deadline, IOV can keep the $10,728 it received from 93 donors, minus 9 percent. Schectman believes the video played a key role in igniting the current firestorm.

“The crowdfunding campaign with Dr. Robb Gaffney sent KSL [the private equity firm that owns SVSH] into a frenzy,” said Schectman. “It really got under their skin.”

It was a few days after the video’s release that Wirth held an informal meeting with some of the people he had heard from who were worried about incorporation. Twenty-eight people showed up. Concerns voiced at the meeting helped “shape my point of view,” Wirth said. The group, which became the basis of Save Olympic Valley, identified four major areas that made them uncomfortable with the idea of a new town, which Wirth outlined in his April 7 letter to LAFCO. The first is the city’s financial viability.

“The preeminent question is that they haven’t proven the town can be fiscally sound and cover existing services,” said Wirth. “Now they are promising to enhance services.”

In the letter to LAFCO, Wirth speculated that a new town might even have to raise taxes to cover the cost of services.

“We believe it is probable that … a new city … would seek to impose higher taxes and fees for services with the intent to supplement inadequate city finances,” he wrote.

Anti-incorporation proponents also wonder if the new town would have enough financial depth to sustain natural disasters or lawsuits, like the legal dispute that forced Mammoth Lakes, with an annual budget of $19 million, into bankruptcy in 2012.

“What happens if there is a big wild fire? Do they have enough resources,” Wirth questioned. “A smaller town is more susceptible; one or two instances can create problems that could have a demonstrably negative impact.”

IOV officials, however, say they are confident that the town will be revenue-rich. According to IOV Board Chairman Fred Ilfeld, Olympic Valley had $1.1 billion in assessed property values in fiscal year 2012-2013 and generates $15 million a year in transit occupancy tax (TOT) and property taxes. Moreover, IOV says that until the independent fiscal analysis is complete — which is required by LAFCO and is currently out to bid — talk about financial problems is disingenuous.

“It’s misleading the public in terms of fiscal viability,” said Gaffney. “We need to wait for the fiscal analysis to come through to see whether the town is viable. Until then it’s a bunch of fluff … There has never been one conversation about raising taxes. It’s another fear tactic.”

CHANGE VS. STATUS QUO

The second area of concern for SVSH and Save Olympic Valley is that the decision to incorporate Olympic Valley will be made by only 560 registered voters, leaving second homeowners and SVSH, the proposed town’s main commercial landowner, disenfranchised.

“We are 40 percent of the land area, and there are 7,500 homeowners and no representation,” Wirth said. “This is a disproportionate situation, the likes of which I’ve never seen. It makes for a potentially volatile situation.”

This was echoed by SOV member Kathryn Luhe, who lives in San Francisco and owns a condo in the Squaw Valley Village.

“There is a greater likelihood that the majority has no voice,” Luhe said. “Olympic Valley is part of a larger community. The majority of people who have interests there will not have an opportunity to participate in governance.”

But IOV discredits that argument. For one, throughout the United States, people are only allowed to vote where they are registered to vote, which is normally their primary residence. Both Ilfeld and Gaffney say that if second homeowners feel passionate about the subject of incorporation, they could change their registration to Olympic Valley. Moreover, they say, it only makes sense that the people who live here full-time make the decisions about the valley’s future.

“The majority of those 7,500 homeowners are timeshare owners that are here one week a year,” Ilfeld said. “The [registered voters in Squaw] represent people who have committed to residing in the valley, and they matter. We don’t claim to represent all of the Squaw Valley stakeholders, but I challenge anyone to have a group that is more qualified to make political decisions in Squaw’s interest than registered voters.”

A third point made by SVSH and SOV against incorporation is that the talent pool of the new town, with less than 600 full-time residents, will be too thin to pull from to adequately staff the town.

“Five hundred people is hardly enough talent and resources to draw on when you have 3,000 people working for Placer County,” said Keith Fountain, who lives in Amador County and has owned a condo in the Squaw Valley Lodge since 2001. “I don’t want to diminish what it takes to govern. Who can argue with self-determination, but with that comes responsibility and skills.”

IOV also dismisses that claim. For one, only town council members are required to live within the town’s boundaries. Town staff, as with many other communities around the region and state, can come from anywhere. For example, Mike Geary, the Squaw Valley Public Service District general manager, lives in Truckee.

“We have a relatively small number of people, but a large pool of talent,” Ilfeld said. “I think people will step up to it. There are other towns like our own in other recreation areas.”

A fourth point made by anti-incorporation advocates is that the current political system is working well, so why change it? Save Olympic Valley members say their voices are being heard by both Squaw Valley Ski Holdings and Placer County, evidenced by the revised development plan released last December that eliminated many of their concerns, like the 10-story hotel that would have been built right next to Squaw Valley Lodge.

“I feel like I do have a voice now. The supervisors are extremely approachable and welcoming of our perspective. They have been open and receptive,” said Kathryn Rees, a Squaw Valley Lodge condo owner since 2001 who lives near Sacramento. “Let’s engage with the process as it is standing. If it’s working, avail of its strengths. I feel it’s working.”

But Incorporate Olympic Valley says that all residents and Squaw Valley stakeholders, including the ski area, would have a greater voice in a town than they currently do with Placer County, which is based 80 miles away in Auburn.

“Squaw Valley will have more say with the town because as the biggest commercial entity, it will be seen more and heard more if we became a town,” Ilfeld said.

DIVIDED WE STAND

On the same day that Wirth released his letter to LAFCO, in an unrelated event, Gaffney resigned from his 20-year role as an ambassador and terrain expert at Squaw. (Squaw says that Gaffney was not an ambassador. “It’s interesting that he resigned from a position he didn’t have,” Wirth said. “He was a part-time seasonal ski instructor who did specialty clinics.”) Gaffney, who has been an outspoken critic of the village development for the past six months, said what made up his mind to step back from Squaw was an April 3 opinion piece in a local paper in support of the ski area signed by 11 people, most of them athletes affiliated with Squaw.

“Once I saw that — I was planning on pulling back anyways — that tipped the cart for me,” Gaffney said. “I started seeing things driven by financial considerations. If you have a system driven by a true community process, not financial, then you make decisions based on community needs.”

Gaffney believes that Wirth’s letter to LAFCO demonstrates that the ski resort views IOV as an adversary.

“I think Andy sees incorporation as a serious threat to the bottom line,” he said. “The fact that he wrote such an in-depth, lengthy letter to LAFCO means that he sees incorporation and the community coming together as a threat.”

While Wirth said he does not want disagreements between the two sides to ratchet up any further, he says SVSH is exercising its right to voice its opinion.

“I certainly would not like to see things get further heated. I would like to think that calm, rational discussions could be had,” he said, but, “We are absolutely going on the offensive. It is our right as a landowner to be a calm, thoughtful voice of concern.”

But some worry that all these accusations and vitriol between those on either side of the incorporation debate are harmful for the people of Squaw Valley, who need to come together to help shape a development they all can live with.

“I think the whole process is pretty toxic to a small community,” said Save Olympic Valley member Larry Tomlinson, a full-time Squaw resident since 2003. “It does bifurcate the community … I would like to see this come out as a win-win as much as possible, and not so much rancor.”

IOV says that’s exactly what it wants — to work with Squaw Valley Ski Holdings to create a town that benefits everyone.

“We’d like to see Squaw be a partner in the town. It has to be,” Ilfeld said. “Our intent is not to fight KSL, but to work together.”

Info: Incorporate Olympic Valley holds community meetings the first Tuesday of every month at 7 p.m. at the Squaw Valley Public Service District, except for the next meeting, which is June 4, incorporateolympicvalley.org. For more information about Save Olympic Valley, visit saveolympicvalley.org.

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Reader comments so far...

Anon's picture

Anon
I would just like answers to practical problems, real or imagined, and to see reports and common sense. Politics: The same issues confront lift/hotel companies, land managers and stakeholders all over. Get used to it and work out a few brakes for good governance and transparency. Grants & Developments: I see no figures or talk about the $800m for innovation, Finance District funding, parking/rentals for the passengers on extra flights comng from DallasFW and other hubs, or the growth in visitations by various groups: see the presentation at the VisitCalifornia conference in 2012 re growth in travellers and their spend. Instead all I hear is 'me me me". The Marginalised: I hear a lot about the "community" however I cannot see any advocate for others such as those teens and tweens, locals on low wages, J1s competing for jobs, parking for the disabled and other groups. Instead I see fingerpointing and demonising wirh contrived concerns. Agent of Change: Moonshine's article on human nature had about 11,000 views and suggested you sit down and see what transpires. Maybe Mayumi was right. Poulsen: Wayne Snr, iirc, in Dale Shannon's op-ed asked Is the community evolved enough. Yes he confirmed to me he used the word evolved. Why not sit down and work on a MOU. In fact, work on revising the NOP. Revised NOP: The senior planner suggested rewriting it with cross references. I recall the DRC wanted tabs. With respect it's incomprehensible to most. The whole vision for the region and for the valley is 'missing' as well. Fitsch: I was puzzled as squabblers went hunting for land, devised ideas and then realised there were problems. Why not put all the titles and easements and regional data and things (like the train extenson perhaps) on the table on a site so you all sing from the same hymn book? FactsNfigures: I noticed commentaries about figures: DRC used Andy's verbal comments on 1.7 people per car, Heidi Maier Deveau wanted mass transit figures, and Ksl surely has studies, RFID info, a Business Model and sales and other data. Why not produce an Agreed Statement of facts, as one does in Court. Sing from the same hymn book before a Judge tells you what he thinks the village should look like. KSL's business model: What variances in accomodation lodgings, and management contracts, are there to spread the risk. After all, if KSL build the wrong thing, everyone's goose is cooked. Wet Amenity: The problem seems to be size and its impact on the backdrop of the slopes. Redesign it. Can it be 'hidden' like Resort at Sc is with black glass against trees. Why quibble when maybe there is a design solution. The other problem is modelling, and traffic etc. Work on something you can all live with. Listening: Like SOV's Mr Fountain's calm views in the advertisements, I noticed issues via google earth and in interposing plans. Issues were raised with my timeshare and I am told the issues were resolved. Later however I get mixed advices from the advisers and Base Camp people who should know. I would like a MOU or agreement and 3D computer generated examples. The ones on facebook show mass, height, light and shadow and widths of lanes and stepping. Why isn't there one of these instead of an out of date plastic model? Nor can I see photos through the model that will give me any idea how it will look from vantage points. If it's "too big" show it and top bickering. Water: Is there truly only enough for '100 homes' or was, as per Minutes, readers left with the wrong information by a water board. I can't see the Public Correction that the Minutes suggested we deserve. Why aren't there hydrology reports? Why aren't there the live reads of wells that might, I have a gut feeling, show water closer to the amounts in ksl's reports? Building 'glug': Is a '7 storey log cabin' with a steep roof the way forward, or will Bay Area buyers prefer a few flat rooves with gardens with cafe al fresco outdoor dining, or whatever? Would snow melt and be recycled. What compromises and styles could you accept that, hopefully, soften the impact? Stepping the buildings; I'm surprised its taken a year for the idea to catch on. Are there any other ideas? Quakes: Is there not an '8 mile pipe' that will carry sewerage gas cable power and water across an aquifer, located over a fault, in a region where siesmologists predict westshore will rise 6' to 12' when an overdue 4000 year event hits? If so, will this 'emergency use' pipe of water and pipe of sewerage not crack. If so, will the water pipe be useless and will the aquifer be polluted? If I'm wrongly worried, tell me. If I'm right, re-engineer it. Wildfires: I cannot see any measures to turn snowmakers into fire fighters or expand ridgeline dams into snowmaking ponds from which fire bombers can draw water quickly. Again I might be wrong, but I think we'd all like to see a readable fully considered nop that goes beyond fiefdoms. Let's be honest: if the lifts are damaged there goes the economy. There will be more issues I'm sure. Why not work on a governance model and solving real problems? Conclusion: Let's be frank. If KSL got its way wth size and zoning changes and if the other developments/homes didn't feel threatened, there wouldn't be a problem. After all a vote in an election every so often won't save you. You need a planning scheme that you can live with. Preferably one that looks after the entire community.
Incorporate Olympic Valley's picture

Incorporate Oly...
This statement by Andy Wirth is a total contradiction. “I certainly would not like to see things get further heated. I would like to think that calm, rational discussions could be had,” he said, but, “We are absolutely going on the offensive. It is our right as a landowner to be a calm, thoughtful voice of concern.”
ryandollar's picture

ryandollar | Tahoe
He's not contradicting himself at all. He's just affirming that, yes, his interests are firm and he's going to fight for him, that's all he means by "going on the offensive." He uses the word "calm" in both statements and one could argue that "rational" and "thoughtful" are synonyms in this context. Quit trying to demonize someone just because they have a vested interest in the success of their business... the business that made this town, mind you. The author was right when they wrote " vitriol between those ON EITHER SIDE of the incorporation debate are harmful for the people of Squaw Valley." If you really believe in your stance, than stand behind that instead of wasting your time smearing Wirth.

MichaelS | Donner Summit
Of course SVSH and 7,500 absentee homeowners are not voters and hence do not have representation. That is the current situation. SVSH is a business, not a person, and cannot vote to elect, or unelect, the County Supervisor that represents the 40% of land area to which Mr. Wirth refers. Absentee homeowners registered to vote elsewhere cannot vote for or against the County Supervisor who represents the area where their second homes are located. This "disproportionate situation" is one the likes of which SVSH lives with at present.
Sam's picture

Sam | LA
The passage "...at which 28 people showed up" caught my eye. Are they seriously saying that 28 mainly Bay Area residents and a Denver-based equity firm have more 'say' with Placer County than with, say, Peter van Nort with experience running Big Bear & Sun Valley and residents who sit on water boards? Perhaps things mght be different if there was more co-operation and less 'sales pitches', glossy brochures and questionable assertions from a very noisy group of a mere 28 people. Talk about pot kettle, Mr SOV.
ryandollar's picture

ryandollar | Tahoe
I feel like the problem of their not being enough talent and resources to draw on in such as small town is a valid concern, but it was just tossed aside by Ilfeld. Just because you live somewhere doesn't mean you have the know-how to run a government. Period. If I'm going to elect somebody then I was to know they have experience in leadership and organization. I want them to be able to know all the legal jargon that comes with government agencies and I want to trust that they won't abuse their power in favor of giving perks to their business partners and friends. Who in Squaw Valley fits that description? Who in Truckee? Ilfeld's response is just like "We'll be good cuz we're good, man. Other people are good, so we'll be good." Not enough, IOV. Give us a better answer to this legitimate question.
thatmoviecalledpowder's picture

thatmoviecalled... | Squaw Valley
Actually IOV plans on hiring an experienced town manager from outside Squaw Valley to come in and manage things. Get that? Outside. Town. Manager. These people are proponents of local control but they keep serving up hot plates of hypocrisy around every turn.

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November 9, 2017