The struggle between Squaw Valley Ski Holdings and Incorporate Olympic Valley over the future of the valley may be playing out publicly in newspaper ads and editorial pages, but behind the scenes another battle is brewing — one that involves hundreds of thousands of dollars, multiple attorneys and consultants, and a complex political process that pits a grassroots effort against a million dollar corporation.
In the latest chapter of this saga, the ski resort and the anti-incorporation group it funds, Save Olympic Valley, won out in their request that an environmental impact report (EIR) be conducted for the proposed town. Incorporate Olympic Valley, which will have to pay for the study, claims this is part of an ongoing strategy by SVSH to draw out the incorporation process and force it to exhaust its financial resources. The ski area, however, states that it is merely exercising its legal rights and abiding by state laws, unlike IOV. Whether you see this story as a modern day David versus Goliath or the majority protecting itself from minority interests, Squaw Valley Ski Holdings is making incorporation supporters work hard to achieve their goals.
“We are moving forward but against strong headwinds,” Fred Ilfeld, chairman of the IOV Foundation, told Moonshine Ink in August.
Political or Environmental?
Squaw Valley Ski Holdings has been pushing since April for the Placer County Local Agency Formation Commission to require an EIR as part of the incorporation process. An EIR, as required by the California Environmental Quality Act (CEQA), identifies a project’s significant environmental impacts and ways to avoid or mitigate those impacts. The ski area believes that an EIR is necessary because the proposed town would result in a change of wildfire fighting responsibility from the state to the new town, as well as shift transit occupancy tax (TOT) dollars away from public transportation.
“The IOV incorporation may result in a potentially significant adverse impact by reducing wildland fire response times and thereby exposing people and structures to a significant risk of loss, injury, or death,” wrote law firm Remy Moose Manley, on behalf of SVSH, in an April 4 letter to LAFCO.
“Incorporation could also result in a reduction in TOT revenue needed to ensure continuation of basic TART [Tahoe Area Regional Transit] levels of service.”
Additionally, SVSH hired Environmental Science Associates, which stated in an Aug. 11 letter to LAFCO that an EIR is needed because of the vagaries of climate change. The environmental science and planning firm claims that because the town’s income would be dependent on the ski industry, the town will have to diversity its economy, which would result in ”additional development and land use changes.”
IOV, on the other hand, argues that an EIR is not necessary because no land is being disturbed in the decision to form the Town of Olympic Valley.
“We are not turning a spade of dirt,” Ilfeld told Moonshine Ink in August. “It has no effect on the environment.”
IOV points to a 2008 article written by lawyer Julie Biggs, who has represented numerous California community incorporation attempts — some successful, some not — such as Goleta, Caramel Valley, Wildomar, and East Los Angeles. Biggs argued that, as decided by the Monterey County Superior Court in 2008, an EIR is not required when forming a city because incorporation of a new city alone does not constitute a project under CEQA. In other words, the decision is who should govern, not what will be constructed.
“The decision before voters is not ‘let’s build city hall,’ but who determines how the city grows — should it be the county or the citizens who live where you are?” Biggs, a partner at Aleshire & Wynder in Riverside, told Moonshine Ink. “There is nothing on the table about what is going to be done because we don’t even know who is going to be elected. The idea that a city by its very nature develops more is not true. The real question is who is going to decide; it’s not environmental but political.”
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Nevertheless, in October LAFCO agreed with SVSH and recommended that an EIR be required for the Town of Olympic Valley, and is currently circulating the notice of preparation for an EIR.
“It’s more legally defensible,” said Placer LAFCO Executive Officer Kris Berry of an EIR. “Anything with this extreme of controversy, you can go through the process and end up with so many issues and court challenges that it favors the preparation of an EIR. The EIR process is very transparent; there is a lot of public participation.”
According to Berry, EIRs are not uncommon for incorporations; she estimates that half of California towns that tried to incorporate in the last 20 years had to conduct an EIR.
IOV, on the other hand, believes that LAFCO is simply trying to avoid potential lawsuits.
“Because there is so much attention and Save Olympic Valley attorneys are providing large documents, there is a lot of pressure to make sure everything is done correctly,” said Jamie Schectman, IOV board member.
An Expensive Endeavor
Preparing an EIR is not cheap. Schectman estimates that it could cost around $150,000, which IOV is responsible for. Incorporation proponents say this is part of the ski area’s strategy to stall the process and drain IOV of funds. In August, lawyers on behalf of Save Olympic Valley sent LAFCO a letter asking that IOV put down a $150,000 to $200,000 deposit for the EIR, even though the project has not gone out to bid yet. LAFCO deemed the deposit was “not appropriate,” according to Berry.
“The SVSH strategy has been primarily twofold with the LAFCO process — delay as long as possible, and force us to spend money so that we’re bankrupt,” said Ilfeld in August.
Squaw Valley Ski Holdings CEO Andy Wirth counters that statement.
“It’s not a strategy. Frankly, I think that’s ludicrous,” Wirth told Moonshine Ink in August. “All we’re doing is exercising rights afforded to us in the process.”
IOV is also responsible for the comprehensive fiscal analysis, which will determine if a town is financially viable, at a cost of $85,000. That amount has been paid in full.
So far this year, Save Olympic Valley has outspent IOV politically 11 times over. According to campaign documents filed with the Placer County Elections Office, as of Sept. 30 the ski area had been the sole contributor to Save Olympic Valley (although Wirth said in August that Squaw doesn’t intend to be the only supporter for much longer). Save Olympic Valley received $412,200 in contributions from SVSH, and the group spent $427,261 this year.
“We are spending a lot because we can’t afford the risk of the outcome,” Wirth said, noting that the majority of the money was spent on lawyer fees to legally set up SOV (as well as on a website for SOV whose URL is similar to IOV’s URL: incorporateolympicvalley.com versus incorporateolympicvalley.org). “It’s way too much risk for our company and this community long-term. We are not doing this because we like to pick fights.”
The IOV Political Action Committee (PAC), according to campaign documents, received $26,649 in contributions, and has spent $36,294 this year. Almost all of those contributions came from three IOV board members — Lisa Cardin, Nancy Elrod, and Fred Ilfeld — who each gave just under $10,000, thereby avoiding any reporting obligations.
IOV officials believe there is a positive side to being drastically outspent politically.
“We take it as a sign that we are doing the right thing,” Ilfeld said. “That they are spending so much money means they are threatened by incorporation.”
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Political Violations?
The IOV PAC was formed in September after a member of Save Olympic Valley claimed that IOV had violated California Fair Political Practices Commission rules by failing to register as a political entity and file campaign reports. While this investigation is still ongoing, IOV restructured in July in order to comply with FPPC rules that all political or advocacy activities be reported. Now the pro-incorporation group is composed of two entities with separate boards, although some members overlap: IOV, the campaign organization that raises and spends money to advocate for the incorporation of Olympic Valley, and the IOV Foundation, which focuses on managing the legal process of incorporation and was awarded nonprofit status in November. Only the IOV PAC must disclose its donors.
Ilfeld, who said it cost IOV $20,000 in attorney fees to comply with FPPC, said IOV did not knowingly thwart the law, but he is glad it was brought to the group’s attention early on.
“We were violating the law and didn’t know it,” said Ilfeld, noting that only 30 percent of IOV’s activities were political. “Better now before much is spent on political activity. This is small potatoes to what comes later on.”
But Wirth questions whether IOV was ignorant of the FPPC rules. He points to a September 2013 email from Ilfeld to LAFCO’s Berry, where Ilfeld indicates that IOV had been notified by its lawyer of a proposed FPCC rule that could apply to the organization.
“The difference between IOV and SOV is that we’ve actually been following state law,” Wirth said.
However, Ilfeld said that Berry never responded to him regarding the letter.
“We at IOV assumed that since neither LAFCO nor our attorney had contacted us about any requirement of reporting to the FPPC, we didn’t even think of the possibility of doing so,” Ilfeld wrote in an email to Moonshine Ink in November.
Development Concerns?
The incorporation proponents, however, would rather draw attention to what they call “the elephant in the room” — that SVSH, SOV members, and other property owners have asked to be excluded from any future town because they are worried about who will make development decisions.
“Something that is not talked about is land use,” said Ilfeld. “What they are really concerned about is who determines land use, the town or the county … It’s why they want to delay us and why they want us out of the picture.”
Property owners such as SVSH, the Resort at Squaw Creek, PlumpJack Squaw Valley Inn, and the Squaw Valley Lodge have all written letters to LAFCO asking to be left out of town boundaries if incorporation succeeds.
“We have no real interest in being part of incorporation,” said Mike Syiek, Squaw Valley Lodge Board of Directors president. “It means more taxes and diversion of resources. Placer County is already doing a great job.”
But IOV says that many of these property owners have pending development projects before Placer County. PlumpJack submitted a proposal in July to demolish its existing building and construct a new hotel, pool, restaurant, and residential buildings. The Resort at Squaw Creek’s Phase II, which has already been approved by the county, includes 441 condominium units. And SVSH is seeking entitlements to expand its village by 100 acres, including 750 new units and a 90,000 square foot Mountain Adventure Camp.
While by law LAFCO can’t entertain any request to be excluded that would create islands within the town, Berry said one alternative that omits some of the properties will be analyzed in the EIR.
“We will see if it’s even viable,” she said. “Just because they asked to be removed doesn’t mean they will. You can’t opt out.”
Responses to the Notice of Preparation (NOP) for a draft environmental impact report for the Town of Olympic Valley Incorporation proposal are due by Nov. 25. Placer LAFCO will hold a public scoping meeting during the 30-day review period on Nov. 18 at 5 p.m. at the Squaw Valley Public Service District Community Room. Info: Placer LAFCO, (530) 889-4097, placer.ca.gov/departments/lafco
