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Judgement by Gregory

July 20, 2012

The Town should ask Rusty Gregory to pay the judgment

These days, our national institutions are out of our control. We should at least be at peace with the idea that we control our local government. But when the record available to us shows our local government is no longer under our control, we are compelled to raise questions and address those individuals who have brought us to financial crisis. So, after a review of public records available to us, I would like to know “who is in charge at city hall” and has as anyone asked Gregory and/or Long to pay the judgment?
To offer my opinion on these points, I have integrated several local news articles within the Mammoth Times, the Sheet and the Court of Appeal’s opinion. With these sources, I have identified the person who I believe brought about the circumstances that created the environment for the litigation and judgment. From this, I opine that had it not been for Rusty Gregory interfering with the management of the Town, the environment which brought about the judgment would not have occurred.

Rusty Gregory no doubt loves Mammoth Lakes. But, there must be a separation between his obligations to the MMSA and his affection for Mammoth Lakes. Neither entity exists without the partnership of the other. But the partnership must recognize that there are two separate and equal entities that have their own obligations. What appears from the public record at this point is that Mr. Gregory manipulated the Town Council and staff to serve his own interest and in doing so brought about the circumstances that created the evidence upon which the jury and the Court relied to support the 30 million dollar judgment.
To understand Gregory’s involvement in bringing about the judgment against the Town, we need to first address certain basic facts represented in the Court of Appeals opinion:

1. In 1991, the Town took over operations of the airport and annexed the property in 1995.

2. In 1992, the Town began receiving grants from the FAA. As a condition of receiving these grants the Town made assurances (a) that it would meet any conditions placed on the funding by the FAA, and (b) the Town would not sell or lease any part of the airport property without approval from the FAA.

3. In 1997, the Town Counsel, comprised of Kathy Cage, John Eastman, Kirk Stamp, Byng Hunt, and David Watson, without prior approval of the FAA, adopted by ordinance a Development Agreement [DA] negotiated with one Terry Ballas. Prior to the Town’s approval, the Town merely sought approval of the DA by the FAA. The DA, later transferred to MLLA, provided that after the Developer made certain improvements to the airport, the Developer would have a right to develop a hotel/condo project on the airport property site. The property would be leased and then sold to the developer.

4. Nine days prior to Council approval of the DA, the FAA faxed to William Manning, the airport director, correspondence describing certain reservations with the DA. The substance of these objections was a request for more information and time to review the DA and its proposed sell/lease provisions. Manning kept this email a secret- did not bring it to the attention of the Council. Tracy Fuller, the then Town Manager, is quoted in the Sheet article as saying “That was an act of gross insubordination.” Mr. Manning’s preposterous excuse was noted by the Court- he didn’t bring it to the Council’s attention because the correspondence was not “a formal FAA letter”. The purpose in mentioning this incident at this time is to separate this FAA objection to protocol from the subsequent FAA demands for Boeing 757 standards at the airport. It is important to keep these two FAA demands separate in your mind. The Boeing 757 demand from the FAA coincidentally came after Rusty Gregory’s insistence for “big planes” to land at the Town airport.

5. The Court stated that by 2000, the developer under the DA had fully performed all developer obligations under the DA.

6. The Court noted that between 2000 and 2004, the Town staff, and specifically Charles Long, engaged in specific conduct to thwart the DA by soliciting the help of the FAA to make demands upon the airport inconsistent with the DA- most notably the October 4, 2004, requirement for Boeing 757 compatibility. As you will soon discover, it was Rusty Gregory who wanted “big planes”.

7. The Court found that, “The Town sought help from the Federal Aviation Administration (FAA) to eliminate the Developer’s ability to build the hotel/condominium project.”

8. The Court also found that, “…the Town violated the development agreement by refusing to move forward with the hotel/condominium project unless the FAA’s objections and demands [for “big planes”] were resolved.”

To answer some of the questions left open with the Court of Appeals opinion, specifically “why” did the Town breach the DA as described, we can look to the Sheet article of April 20- “Airing It Out” and the interviews conducted therein. Certain statements [facts?] are clear from the interview conducted. The statements obtained point to interference in Town business by Rusty Gregory which prevented performance of the DA by the Town. “But for” Gregory’s interference there is no evidence currently available to suggest that the DA would not have been fully performed by the Town. From the Sheet:

1. Prior to October 4, 2004, Steve Julian was the Town Manager- 1999 to 2003.

2. Julian opined that the DA “was compatible with commercial air service. We weren’t talking about building LAX for godsakes.” Julian wanted MMSA to provide “some sort of financial backing or guarantee” to support the airport upgrades. The Sheet reported, Julian’s view was not shared by Rusty Gregory. Gregory wanted “big planes” and wanted the Town to carry the complete financial burden. Then:

3. Tony Barrett, a member of the Town Council from 2002-2006: “Rusty Gregory wanted Steve Julian fired… and tasked me with it [the job].” The Article shows Julian was not playing ball with Gregory. He was doing his job by representing the Town’s interest in the DA. The Sheet article describes Julian as spending time negotiating with Ballas over the DA. That is exactly what competent managers of cities and towns are expected to do.

4. In response to the Sheet question, “Did Rusty Gregory pull strings to get you fired?” Julian responded, “Yeah. It was clear the Mountain wanted to take over the deal.” [an infinitely important statement]

5. Barrett said that, “Rusty Gregory gave him Charlie Long’s business card”. Now remember, from the District Court opinion, we can read details of Long’s activities which were specifically relied upon by MLLA to establish evidence of a breach by the Town and to support the 30 million judgment. It appears that Long was Gregory’s boy. It was Long’s notes, quoted by the Court, with statements of help us “get rid of Hot Creek” to the FAA and “Hammer Hot Creek” after a non-public staff meeting, which the Court relied upon to show the Town’s intent to breach the DA.

6. The evidence relied upon by the Court of Appeals and the statements made within the Sheet article suggest clearly that without Gregory replacing Julian with Long the DA would have been performed. For example, in response to the judgment, Julian simply stated, “I feel strongly that if you make an agreement, live up to it, and if you’re not gonna live up to it, renegotiate.” With Julian at the helm and not Long, there appears to be no opportunity for the breach of the DA to have occurred.

7. To hide Gregory’s introduction of Long to Barrett, Barrett stated that he handed Long’s card to Rick Wood, “leaving it to Wood to call Long, so it would look like Wood’s idea if Long was hired.”

8. Ten days after Barrett gave Long’s card to Wood, Barrett stated that a “closed session” was held at Councilman Dan Wright’s office [Summit Condominiums] “and that was the end of Julian”. No mention of who was present or whether or not these individuals complied with the California Open Meeting Law when holding this meeting.

9. Long was appointed Interim Town Manager on November 19, 2003. [Mammoth Times, “The Hot Creek Players, 1997-Present, Jan. 8, 2011] According to court records, on June 28, 2004, Long met with the FAA and asked the FAA to help the Town “get rid of Hot Creek”. The next, day Long sent an email to the Developer stating that the DA could not go forward until the FAA issues are resolved. From the Court opinion, it was this evidence MLLA relied upon to establish the elements of the Town’s breach of the DA.
10. In response to Long’s request for help, to get rid of the Hot Creek project, on October 4, 2004, the FAA sent the Town a letter stating “new” objections including that the Hot Creek project was not consistent with airport infrastructure to accommodate “Boeing 757 type aircraft”. A Boeing 757 is compatible with intercontinental air service not commuter service. We will find out that it was Rusty Gregory who wanted “big planes”.

11. According to Councilman Kirk Stapp, “Rusty [Gregory] and Charlie [Long] wanted to use the FAA as a hammer to eviscerate the D.A.” Stapp stated that “Rusty was out to get him [Ballas]; “Long was out to get him [Ballas]”; “and I was out of the loop being fed b.s.”

12. According to Stapp, at a closed session during 2004, “Long unveiled his plan to get rid of Ballas. His exact words were ‘get rid of Hot Creek.’” Stapp recalls Long stated Rusty Gregory was “supportive of this plan.” Why would any member of the Council care what Gregory thought. Is Gregory in that much control of the Town Council?

13. Rusty Gregory admits to the Sheet, “that the story is true. Long did tell the Council to get rid of Hot Creek.” But Gregory says that he was merely passing on to Long what the FAA told him. We will see. Why would the FAA demand an intercontinental size aircraft (“big plane”) as a standard for the Mammoth Lakes airport? Is there anyone who believes that Gregory did not plant that idea with the FAA?
14. According to Stapp, Rusty Gregory was playing Rick Wood and the entire council. His opinion of Gregory’s relationship with Wood is, “I think they have a love/hate relationship, but it’s more on the love side.”

15. Councilman Eastman opined that Long’s “belligerence” in wanting to get rid of Hot Creek was the issue. Long’s belligerence “short-circuited due process and exposed the Town.”

16. After Skip Harvey took his council seat in 2004, he recalls a day when he and Rusty Gregory were on the hill skiing together. When they would stop, Rusty would “extol the virtues of the big planes.” Skip would “tell him to bring in small planes” and as they skied each would alternate between big and small plane desires. Apparently, no council member wanted Boeing 757 aircraft landing at Mammoth Airport, but Gregory did.

17. There is nothing to suggest that after Long asked for the FAA to help kill the DA that the Boeing 757 was the FAA’s idea.

Perhaps the most egregious act of Rusty Gregory was having the Town Manager fired. Fired, for what appears to be simply doing his job and disagreeing with Gregory. This, I believe was an arrogant act which reveals clandestine control of the Town. If his idea for a Boeing 757 did not get traction with the Town Manager and the Council, the idea should have died. This event clearly reveals a lack of separation of power between MMSA and the Town. Recommending Charles Long, his “hit man” for the Hot Creek project, as the replacement Manager, shows a gross failure of Gregory to recognize his place in the scheme of local politics.

It is no wonder that the Sheet could not get comment from Charles Long. Remember, “immunity” for public employees is not absolute. What happened with MLLA was a violation of a DA and a violation of a legislative act.

So, the questions remain to be answered. Has there been a serious discussion about the liability of Rusty Gregory and Charles Long to the judgment; an action against either or both to indemnify the Town against the judgment?

If all of the above is true, and no such discussion has taken place, why does Mammoth have elections for the Town Council? Why not save that money and simply ask Rusty Gregory what he wants staff to do.

Jean Harris, resident

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