According to Town of Mammoth officials, on February 2nd Mammoth Lakes Land Acquisition filed a petition with the State Court to demand payment of the full $42 million legal judgment against Mammoth, after 10 months of negotiations. Town officials revealed this startling turn of events after MLLA went to local media on Tuesday to accuse Mammoth of bad faith negotiating.
Jay Becker of MLLA emailed a letter to Sierra Wave and other local media which said that the Town had ceased settlement efforts and refused to respond to a December 14 proposal from MLLA. The letter said the Town’s conduct “smacks of bad faith.” Mammoth Town Councilman Rick Wood called it “posturing” by MLLA.
A press release issued by the Town late Tuesday afternoon said that on December 1st the Town had made a multi-million settlement offer to MLLA. Then, the Town says, in light of “worsened fiscal conditions” Town officials decided they could not pay that December 1 offer. They didn’t tell that to MLLA until January 19th. Meanwhile, on December 14th, MLLA proposed an even larger payment amount. And, on February 1st a standstill agreement between the two sides expired. That agreement had prevented MLLA’s collection of the millions from Mammoth.
Mammoth officials said they wrote to MLLA on January 19th to say that in light of “current fiscal realities” the Town has to re-examine its finances, including the settlement with MLLA. The press release says that the Town has begun the development of a “global restructuring plan” to address fiscal issues impacting the Town. But the Town’s press release said they told MLLA they would present another settlement offer after February 1st. The Town Council is still meeting in closed sessions over that offer. In fact, another closed session was scheduled for Wednesday morning.
In its press release, the Town blames MLLA for an abrupt halt to settlement talks and MLLA blames the Town for the same thing. Mammoth officials said MLLA filed with the court and did not give Mammoth advance notice. The press releases says, “Sadly but clearly, MLLA is the one acting in bad faith.”
Even after all of this, the Town says it will submit another offer to MLLA in the near future. The press release never does explain the “worsened financial conditions” that led to this tangle of misunderstanding. (See entire Town press release below.)
PRESS RELEASE Town of Mammoth Lakes Responds to Mis-Information by MLLA
Town of Mammoth Lakes, California – February 07, 2012 — Since April 2011, the Town of Mammoth Lakes has been negotiating with Mammoth Lakes Land Acquisition (MLLA) in an attempt to reach a settlement of the judgment MLLA obtained against the Town, arising out of the Hot Creek development project. As part of those negotiations, the Town has made full, complete and ongoing disclosures of all of its financial and operational information to MLLA. Frequent closed session discussions have taken place among Town Council members and staff to develop and present to MLLA payment proposals that the Town could afford, keeping in mind its obligation to provide essential municipal services to the community and visitors.
On December 1, 2011, the Town made a multi-million settlement offer to MLLA – an amount that the Town currently feels it cannot afford to pay, in light of the worsened fiscal conditions since early December. On December 14, 2011, MLLA requested an even larger payment.
On January 19, 2012, the Town withdrew its December 1 offer, writing to MLLA: “In light of current fiscal realities, the Town has determined that it needs to more closely analyze and assess pertinent issues with financial implications, including the ongoing efforts to reach a resolution with MLLA. The Town has begun the development of a global restructuring plan, which will address the various fiscal issues impacting the Town.” The Town’s January 19th letter further stated that another settlement offer would be presented to MLLA after February 1, 2012. Since then, the Town has continued to work on a sustainable plan to both pay MLLA and satisfy its other fiscal obligations. Frequent closed session discussions continued.
In the meantime, it is MLLA that decided to abruptly stop settlement discussions with the Town. To the Town’s surprise and dismay, MLLA filed a petition with the State Court on February 2, 2012 (and served the Town on February 6) to demand payment of the full $42 million legal judgment. MLLA then went to the local media and accused the Town of bad faith negotiations. All of this was done without an advance notice to the Town, or any indication that MLLA was about to cease the settlement process. Sadly but clearly, MLLA is the one acting in bad faith.
The Town will, after careful consideration of its obligations to the citizens, businesses and taxpayers of the Town, submit to MLLA in the near future another settlement proposal that the Town can afford consistent with its stewardship of the public’s funds.
I’ve read a lot of comments above suggesting MLLA would have “lost their shirts” etc had they actually gone through with their planned development at the airport. As I understand it… another sick twist to this whole mess is that MLLA is/was NOT THE ACTUAL DEVELOPER planning the project at… Read more »
The town should just not pay. Nothing will change. There are laws against stopping public services the town provides even when there is no money. I SUGGEST WE STOP PAYING LOCAL TAXES AND PROPERTY TAX BECAUSE IT WILL ONLY BE PAYED TO THE MLLA BASTARDS. THEY ARE JUST HAPPY THAT… Read more »
Dang, this whole thing just sucks.
Pretty sad isn’t it Dingo .. no wonder everyone is going broke, except the few ultra rich millionaires.
But it’s no wonder they are so rich, with schemes like this.
Once again I recommend reading “Barrier Island” by John D. MacDonald. A scheming developer buys a barrier island off the Mississippi Gulf Coast knowing that the Feds would never approve developing there because it’s in the path of hurricanes. Then enters into a development agreement with the state — with… Read more »
Now that is funny. A hundred to 0 against reading. hahahahahah
The commenting system has been broken and is open to spamming. I alerted Benett to this a while ago.
Oh yeah, so I see. But it’s funny that someone would actually take the time and spend the energy to do that….
How tweet it is!
All the posters here have made excellent points. I know that many town employees really fear a municipal bankruptcy filing. I am NOT an expert on same, but most town employees believe they will lose many of their contract benefits under any form of municipal bankruptcy filing. I believe this… Read more »
Municipal bankruptcy often focuses on employment contracts to negate their prior contractural obligations/promises. With Wilbrecht and the other “honest folks” at the helm of the Town you had better beleive that the only people that will benefit from the future negotiation will be them – rarely (in fact I don’t… Read more »
Scott I believe you have it a bit incorrect. The lawsuit was about an agreement between a developer and a political division. The developer sued because the political division felt it did not have to honor an agreement and therefore there were no consequences. This type of thing has been… Read more »
In fact the Town staff damned themselves by keeping written documentation of their deliberate intentions to take advantage of this developer – one of the key reasons that the judicial system refused the appeals.
That was normal practice of such Political divisions in the past. The feeling was that the PD could do whatever was in the best interest of itself or the constituents with no repercussions. This win by a developer showed that not to be the case. At a detriment to future… Read more »
Well, in my view, TOML hired Dave Wilbrecht for three main reasons: 1) in reward for services rendered to the Town while he was CAO of Mono County (e.g., talking the County into participating in the airline subsidy (which really only benefits Mammoth)); 2) to ensure that no one (most… Read more »
2rude: Think big picture here. Over 90% of the accessed value of Mono County is in the Town of Mammoth Lakes. 90% of Mono County’s revenue comes from property taxes. Starting to get the picture yet? What is good for Mammoth is good for Mono County. Mammoth property tax bankrolls… Read more »
Thanks Reality Bites; I understand your point, but please consider this: 1) The airline subsidy has been in place for several years; and yet, according to County Assessor Jody Henning, assessed values in Mammoth are DOWN (even MMSA sought and received a significant reduction in its property-tax assessment); likewise, according… Read more »
Scott you nailed it. As I said before, MLLA should be paying TOML for preventing them from building an ill conceived project at a horrible location where few if any would buy.
It’s time to seriously consider filing for Chapter 9 bankruptcy. The town’s finances would be “reorganized” and past unsecured debts (such as the debt to MLLA) discharged. Bankruptcy would actually have a positive impact on the future of town finances by discharging un-repayable debts. I think we all realize that… Read more »
The issue at hand has nothing to do with the jury verdict or what is fair or not regarding the amount of damages – that is past history as this point and a waste of our emotional energy. Also, I’m not sure what is meant by discharging the debt –… Read more »
given their track record…………. they should all be replaced.
I am all for the Town Council to be replaced with a Bankruptcy administrator. The Town Council has no common sense. I cringe every time I watch/go to a city council meeting because they make so many bad decisions and spend so much money that we do not have. Why… Read more »
Let’s see – Wilbrecht $200K per month, 3M $4k per week (with no end in sight for her “valuable” consultation services) – very expensive for the Town taxpayers for nothing more than “front persons” to take the hit for the bad decisions of the politicians….And look what positive contributions to… Read more »
$200K/month? Where did you get that from? I suggest you do some fact checking.
It’s $200,000 per year.
BK
Ooops – my bad, should have typed annually… thanks for correcting Benett and Harry.
TOML’s financial bankrutcywill go nicely with MMSA’s moral bankrutcy. Thanks.
MLLA = the biggest scam in Mammoth History… talk about bad faith .. These people are mobsters…
Jake, if anyone is at fault it is the former town attorney Peter Tracy, who gave the town bad advice from the very start to the very end, then quit. The council hired him to give accurate legal advice. He gets off the sinking ship after torpedoing the ship!
“To the Town’s surprise and dismay…”
The Town has been surprised by everything that has happened at the airport and with the settlement negotiation. Why? Maybe can’t understand that if you bury your head in the {sand, snow, pumice, whatever…} things don’t just go away.