Access in question at Dreyfus
It has been nearly five years since the U.S. Forest Service started down the long and mistake-ridden path of acquiring 47 acres of prime Lake Tahoe real estate and losing access to 11.8 acres of it.
The 10,000-square-foot Dreyfus mansion and buildings that sit on six acres of Zephyr Cove land remain empty except for a caretaker and his wife paid by Park Cattle Co., a Minden-based firm that claims ownership of the estate buildings.
Federal investigations into the land exchange blame Forest Service mishandlings, some deliberate and some inadvertent, for sticking taxpayers with the bill for property, including 3,000 feet of pristine beach the public can’t access. Consequently, the U.S. Department of Agriculture Office of Inspector General made several recommendations to the Office of General Council to regain access and clear title to the Dreyfus estate buildings – recommendations that were supposed to be carried out by Jan. 1, 2001.
Two months past the deadline, the Forest Service’s regional press officer Matt Mathes said the inspector general’s recommendations have been taken into consideration during the three-year negotiations with Park Cattle.
“It’s safe to say that all the recommendations are tied into the negotiations,” Mathes said. “But since the negotiations are with a private party and both sides have agreed they’re confidential I can’t say too much more.”
In an audit released in July 2000, the inspector general asked for a final title opinion from the Office of General Council identifying ownership of the estate buildings, water rights, development and easement rights. The opinion was supposed to be released last September, however Mathes was unsure of its nature or whether it was released.
The inspector general also decided the Forest Service needed to collect a fee for back rent from Park Cattle.
The Forest Service’s regional office management estimated Park Cattle owed about $450,000 per year for Park’s exclusive use of about six acres of public land surrounding the buildings.
The Forest Service concluded the public is out $1.35 million in rent because Park Cattle refused in 1998 to pay the fee based on the land’s fair market value and has not removed buildings the company has no special-use permit to operate.
As a way to resolve ownership woes, the inspector general recommended the Forest Service offer Park Cattle fair market value for the estate buildings. Confidential sources close to the negotiations speculate that Park and the Forest Service will negotiate such a deal by summer.
However, the Forest Service won’t need to pay for water, development and land coverage rights because the inspector general found that Park never purchased them.
According to the inspector general, Park Cattle has used government-owned water rights for almost three years to support the caretaker and to maintain landscaping around the buildings without Forest Service authorization and without paying the public for the use.
The inspector general noted the Forest Service should assert its ownership rights to the water by reporting a change of conveyance with the Nevada State Division of Water Resources and should ensure that Park pays the public for the water it used.
Development and land coverage rights
The Forest Service paid for and owns all development rights and land coverage associated with the public land to which Park Cattle has denied access.
Development rights and land coverage are required by the Tahoe Regional Planning Agency in order for new construction to begin or for existing structures to remain on land in the basin. These assets are sold on the open market, being detached from and transferred to parcels in the area. The inspector general recommended the public be reimbursed for Park’s use of the two development rights and portion of land coverage.
Who has the right of way?
The Inspector General also recommended easement rights be resolved.
Park Cattle alleges it has ownership rights to the front gate and driveway providing the only access to the estate buildings, besides by boat. The Office of General Council found that neither the driveway nor the gate was ever transferred to Park Cattle. However, the Office of General Council stated that Park could challenge the status of the right of way to the buildings and petition the court for the right to access the buildings it occupies.
The government could take Dreyfus
Although the Forest Service has negotiated with Park for nearly four years on several issues surrounding the shady land swap, the federal government could have ended the ownership tug-of-war before it began.
The government has the right to declare a taking of the buildings under the Condemnation Act of 1888 and the Declaration of Taking Act of 1931, which allow the Forest Service to take land or buildings from an unwilling seller when it serves an important public purpose and protects a valuable National Forest resource.
However, the inspector general recommended the Forest Service only exercise this right when negotiations fail. The question then becomes how long can Park Cattle and the Forest Service prolong talks before negotiations are considered to be a failure?
Mathes was assured by the government’s lead attorney overseeing the Dreyfus talks, that a resolution would be decided by this summer.
But because all talks are of a private nature, no one really knows, except the parties involved, what will be decided or when.
That is why the Douglas County Board of Commissioners authorized a grand jury investigation into the Dreyfus deal almost three weeks ago, according to Commissioner Steve Weissinger.
“Those two parties, Park Cattle and the Forest Service, say they’re close to a resolution but we thought we had a resolution over two years ago,” Weissinger said. “With all due respect to the Forest Service and Park Cattle this (grand jury investigation) would basically light the final fire under their tails so to speak; so they come to a final agreement by late spring.”
Weissinger said the grand jury has subpoena powers over the federal government so the grand jury should be able to obtain Forest Service information and testimony because all grand jury investigations are protected under attorney-client privilege. Findings from the investigation will be released by the end of this year, hopefully prompting Park and the Forest Service to come to a resolution before the grand jury’s report is released, Weissinger said.
“(The grand jury investigation) lets the Forest Service know that Douglas County has not gone away,” he said. “The negotiations need to come to a resolution. It’s been going on long enough.”
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