Tuesday, July 14, 2009

King Salmon man goes missing in Headwaters

Kenneth Norman Dotson reportedly suffers from depression

Humboldt Sentinel staff
7/14/09

Fortuna

An elderly resident of King Salmon has been missing for over a week and the Humboldt County Sheriff’s Office is on the lookout.

Kenneth Norman Dotson, 67, was last seen on July 6 at his daughter’s residence in Miranda. His vehicle, a blue 1994 Buick LaSabre, was located at the Elk River Trailhead of the Headwaters Forest Reserve.

According to the HCSO release, Dotson is considered as an at risk individual due to a depressive condition, and relatives also report that his disappearance is out of character.

Dotson is described as a white male, 5 foot 9 inches tall, 170 pounds, with grey hair and blue eyes. Members of the public with any information about Dotson’s whereabouts are asked to call the HCSO at (707) 445-7251.

Monday, July 13, 2009

Bill passes to halt suction dredge mining

Resumption would await new regulations from Fish and Game

Humboldt Sentinel staff
7/13/09

Sacramento

A measure headed to Governor Arnold Schwarzenegger’s desk would immediately enact a temporary ban on suction dredge mining in rivers and streams across the region.

Senate Bill 670, authored by Pat Wiggins (Dem - Santa Rosa) and Lois Wolk (Dem - Davis), was adopted earlier today by a 28-7 vote of the State Senate -- a sufficient margin to override a possible gubernatorial veto.

The ban would stay in place until the state’s Department of Fish and Game finishes its court-ordered overhaul of regulations governing this practice, which the bill’s backers claim is highly destructive to spawning grounds for fish. Suction dredge mining involves powerful machines which float on the river’s surface and suck up sediment to uncover valuable minerals.

Wiggins asserted in a release today that she undertook this legislation due to her alarm at the decline of salmon and steelhead populations on the North Coast, which led to recent bans on salmon fishing up and down the Pacific seaboard.

“This ban affects the livelihoods of thousands of commercial fishermen, fish processors, and charter boat operators,” she stated. “The ban has eliminated hundreds of thousands of dollars in economic activity – especially in rural areas.”

“Yet while fishermen are being told to stop fishing, a recreational activity called ‘suction dredge mining’ is allowed to continue. SB 670 is about equity. We simply cannot ask an entire fishing industry to stop their work, while a small group of hobbyists are allowed to continue.”

The state was ordered by a federal court to overhaul regulations governing suction dredge mining as a result of a 2005 lawsuit by the Karuk Tribe. After counterclaims by suction dredge miners, the courts ordered Fish and Game to complete a California Environmental Quality Act review before it acted. This CEQA review was supposed to take 18 months and wrap up a year ago -- but Fish and Game has yet to even begin the process.

Last Thursday, the Alameda District Court issued a preliminary injunction in the case, ordering Fish and Game to immediately cease using general fund money to operate the suction dredge permitting program because it is being operated in violation of CEQA.

“In addition to this being essential to saving salmon and steelhead fisheries, this bill will save the department an estimated $1 million in costs, to administer a program that does not pay for itself,” Wiggins added in her statement.

Assemblymember Jared Huffman (Dem - San Rafael) shepherded the bill through the State Assembly, along with Noreen Evans (Dem - Santa Rosa) and Dave Jones (Dem - Sacramento). It received its strongest support from the California Tribal Business Alliance, the Karuk Tribe and other tribal organizations, along with a coalition of fishermen and environmental groups.

Sunday, July 12, 2009

Arcata Corps Committee targets Eureka waterfront?

Development in neighboring city apparently part of growing mandate

Humboldt Sentinel staff
7/12/09

Arcata

Does the City of Arcata’s Committee on Corporations and Democracy have jurisdiction over development on the Eureka waterfront?

That unlikely question will come into play Tuesday as a special meeting of the Corporations Committee has as its only item of new business the “Proposed Home Depot in Eureka” discussion. This irregularly scheduled session will take place at the Arcata Branch Library behind City Hall at 3:30 p.m.

The idea of a Home Depot outlet as the anchor store of a proposed commercial and residential development of the former railroad yard known as the Balloon Tract has predominated recent Eureka city politics, especially due to the involvement of billionaire Republican fundraiser Rob Arkley through his family-owned Security National company.

Yet while it’s true that the Balloon Tract environmental and developmental review process will extend beyond the boundaries of Eureka if the project is sent up to the California Coastal Commission, the City of Arcata wouldn’t appear to be an agency with any purview over a Eureka development -- and it’s never been publicly suggested by any Arcata official that they were inviting Eureka to review projects in Arcata.

The Corporations Committee, dominated throughout its history by a majority of its members also adhering to the ideology of Democracy Unlimited of Humboldt County, is seeking to expand its mandate -- a mandate already revised by previous City Councils to give the committee advisory powers over a wide array of economic and political affairs in Arcata. The committee-administered Arcata ordinance banning the operation of new “formula restaurants” is the subject of ongoing lobbying efforts by the Corporations Committee and by other DUHC members to expand this cap to all retail establishments in the city that fall under the Corporations Committee’s “chain” definition.

Officially, the City of Arcata has no position on the proposed Balloon Tract development, with or without a chain hardware store. DUHC does have a position, and a prominent one, and their controversial leader David Cobb has made no secret of his total opposition to any private development on the waterfront parcel in numerous public statements. Before he was fired as a Times-Standard columnist, Cobb accused the Arkley family of demonstrating an “arrogant display of wealth and power,” and likened the Home Depot proposal as akin to developments found in a “third world country.”

Also on the Corporations Committee agenda are proposals to ban bottled water and plastic bags, impose rent control, push federal legislation on government-run health care and continue their “educational component” consisting of an ideology identical to that of Democracy Unlimited.

Backbone Fire torches over 5,000 acres

Big Rock closes as army of firefighters assembles in Willow Creek

Humboldt Sentinel staff
7/12/09

Eureka

The lightening-sparked Backbone Fire in a remote corner of Six Rivers National Forest is now responsible for torching approximately 5,200 acres of steep backwoods countryside, and is only 25% contained.

State and federal authorities have responded with the assemblage of a small army of firefighters based in Willow Creek, and forest officials have closed the Big Rock River Access site off of Big Rock Road in Willow Creek due to the growing needs of the firefighter encampment and the nearby helibase.

"Rafters, kayakers, and anglers use this popular area to 'put-in' to the lower Trinity River," said Forest supervisor Tyrone Kelley. "With 10 helicopters and other aircraft continually active in the area, public safety is our primary reason for this closure order."

Visitors to the river can still launch their boats at Camp Kimtu Beach adjacent to Veterans Park, according to the SRNF release. However, there is still a “no stop zone” on the Trinity River from the mouth of Willow Creek to one mile downriver, where visitors are asked to float through with caution due to the nearby helibase.

Other ongoing closures include Horse Ridge National Recreation Trail, Salmon Summit National Scenic Trail, Mill Creek, Tish Tang, and Red Cap Trails, Bear Hole, and Grizzly Camp areas.

Meanwhile, the 11 “hotshot” firefighter crews continue to make progress through hazardous snags, dense brush and steep conditions, further securing the southern and western flanks of the blaze located 36 miles northeast of Willow Creek in the Trinity Alps Wilderness.

Indirect fire line construction continues along Devil’s Backbone Ridge, Fawn Ridge and the drainage for Salmon Creek. Firefighters are also preparing Salmon Ridge as a future burn-out operation to be operated as conditions permit.

District Ranger Mary Kay Vandiver also announced the commencement of clearing activities around the small town of Gasquet as a follow-up to the community protection project implemented in 2003 to create shaded fuel brakes. Pioneer Village, North Fork Loop, Gasquet Mobile Home Park, French Hill Road, Gasquet Mountain Road and French Hill Trail will be thinned of small diameter trees and brush will be cleared in a project spanning over the next two months. Members of the public who are interested in this project are asked to contact district fuels planner Sheila Balent at (707) 457-3968 or at sbalent@fs.fed.us.

On the administrative side, Ken Swartzlander's California Type II Incident Management Team has joined George Custer's National Incident Management Organization out of Atlanta to manage the Backbone Fire.

Saturday, July 11, 2009

Waste Management burglar caught in the act

Aaron Wade Kangas was holding a portable stereo at time of arrest

Humboldt Sentinel staff

7/11/09

Eureka

The activation of a silent alarm led Eureka Police Department officers to the red-handed arrest of a 47-year-old Eureka man last night.

At about 9:30 p.m. officers were dispatched to the Humboldt County Waste Management facility at 1059 West Hawthorne Street -- the same location which had been experiencing a rash of recent burglaries in which unidentified parties had been burglarizing the place overnight, including twice in just the past week.

After setting up a perimeter around the property, officers observed a male subject inside the fenced property carrying several items as he headed towards the exit gate. According to the EPD release, officers ordered the man, Aaron Wade Kangas, to the ground at gunpoint. He was handcuffed and taken into custody without further incident, and booked at the county jail on burglary charges.

Kangas was carrying several items belonging to HCWM at the time police arrested him, including a portable stereo. The items were recovered and returned to the business.

KHSU to air ‘California in Crisis’ series

Special reports from National Public Radio begin Monday

Frank Whitlatch, Humboldt State University

7/11/09

Arcata

National Public Radio is producing a special series on budget and policy challenges facing California, which will air all next week on public radio station KHSU-FM. The series is tentatively being called "California in Crisis."

The segments will begin Monday, July 13, and continue through Thursday. Topics will range from “ballot box budgets” to “Ungovernable California” and “Arnold’s legacy.”

The special coverage reflects growing national interest in California’s inability to adopt a budget in the face of a $26.3 billion budget gap.

Specific times for the segments are not yet available, but they are scheduled for Morning Edition, which airs locally from 6 to 9 a.m. weekdays, and All Things Considered, which airs 5 to 7 p.m. weekdays. For more information, visit the shows’ websites at npr.org by selecting “programs.”

KHSU is a community-supported public radio station that is licensed to, and supported by, Humboldt State University.

KHSU can be heard around Humboldt Bay and beyond at 90.5 FM as well as KHSR-FM 91.9 in Crescent City-Brookings. There are also three translators: 88.7 FM in Ferndale-Fortuna, 89.7 FM in Garberville, and 99.7 FM in Willow Creek.

Friday, July 10, 2009

Two more arrested in jailhouse trafficking case

Accused guard released after posting $50,000 bail

Humboldt Sentinel staff

7/10/09

Eureka

The investigation and subsequent arrest last weekend of a guard accused of trafficking narcotics into his own lock-up came full circle this week, with the alleged dealer and buyer both arrested yesterday.

Taryn Nichole Mabe, 20 of Willow Creek, turned herself in at about 5:00 p.m. last night at the Humboldt County Sheriff’s Office, where she was charged with conspiracy, conspiracy to bring a narcotic controlled substance into a correctional facility, conspiracy to bring contraband into a correctional facility, conspiracy to possess a narcotic controlled substance, and conspiracy to possess marijuana.

Her stay in the Humboldt County Correctional Facility was short-lived, however, as she immediately posted the $20,000 bail; Mabe’s arraignment is scheduled for July 22 at 1:30 p.m.

Also arrested was current inmate Ruben Anthony Peredia, who allegedly made use of the heroin, tobacco and marijuana shipped in to him by accused correctional officer Benjamin Jentry-Rakestraw. The inmate has been in the HCCF since March 1 when he was booked for the murder of Ezra Sanders, and will be arraigned on the drug charges on July 13.

According to HCSO public information officer Brenda Godsey, Peredia arranged for his girlfriend, Mabe, to drop off the drugs outside the jail, where Jentry-Rakestraw then picked it up and attempted to bring it in to deliver to Peredia.

No additional arrests are anticipated, according to the HCSO release.

Thursday, July 9, 2009

Officers hunt down suspected burglar

Alleged accomplice, another parolee also nabbed

Humboldt Sentinel staff

7/9/09

Eureka

A Eureka man wanted in connection with a June 26 burglary and subsequent credit card fraud was caught today, along with an accomplice and a third subject.

Steven Lawrence Dorfman, 38, already had an active warrant for violating his parole when he was also accused of the burglary and of making use of stolen credit cards. At about 5:40 p.m. yesterday, Bayshore Mall security personnel spotted Dorfman with a female subject and notified the Eureka Police Department. While the private security firm kept track of Dorfman, EPD officers responded, but too late, as he and his companion left the mall prior to their arrival.

The license plate of his vehicle was recorded, however, and a county-wide alert led to a California Highway Patrol officer locating his vehicle at a Eureka motel about three hours later. EPD officers once again closed in on Dorfman, who once again attempted to escape with his companion, this time on foot.

After a short foot pursuit they were taken into custody, and Dorfman was charged with burglary, theft by access card, resisting arrest and possession of stolen property. His companion, 23-year-old Eureka resident Christina Renee Asbury, was charged with violating the terms of her probation, with involvement in the burglary, and was also found to be in possession of counterfeit US bills.

Back at the motel room, a search uncovered several knives, methamphetamine, marijuana and a fire safe. A 27-year-old Eureka man, Shad Andrew Sovereign, was found in the motel room and taken into custody for parole violation.

The vehicle Dorfman and Asbury left Bayshore Mall with was located at the motel and towed until a search warrant could be obtained, and the investigation is ongoing, according to a release by EPD detective sergeant Patrick O’Neill.

EPD catches up with alleged thief

K-9 unit “Tahoe” helps cut second escape attempt short

Humboldt Sentinel staff

7/9/09

Eureka

A man wanted for several weeks on drug and stolen property charges was nabbed by Eureka Police Department detectives and their canine partner today.

William Lee Nicholson, 29 of Eureka, had successfully fled on foot from an EPD unit which pulled him over on June 19, when he had provided false information to the officers to avoid discovery of controlled substances and stolen property in the vehicle he was driving. His passenger at the time, 23-year-old Katrina Marie Gerace of Eureka, was arrested for failing to obey a lawful order and obstructing the duties of a police officer.

EPD officers at about 6:20 p.m. yesterday evening spotted Nicholson standing in the yard of a residence on the 3900 block of Cedar Street. The officers observed Nicholson turn and walk into the residence, at which time the unnamed detectives set up surveillance on the residence until additional units arrived.

By the time EPD officer Michael Guy and K-9 unit “Tahoe” arrived, however, Nicholson had yet again pulled his disappearing trick. Guy and Tahoe tracked him to a neighboring yard, where Nicholson was found hiding in the bushes. He was taken into custody without incident and charged with the original drug and stolen property charges.

Gerace was contacted standing outside the same Cedar Street house and also arrested on an outstanding warrant alleging possession of a controlled substance.

Both suspects are in county jail and await arraignment.

Wednesday, July 8, 2009

Hate crime suspect arrested

John David Osborn accused of painting racial statements on Harris Street

Humboldt Sentinel staff
7/8/09

Eureka

A local man holding a paint bucket and roller was arrested after a brief foot chase with an officer on Harris Street on Saturday.

John David Osborn, 21 of Eureka, was observed by a Eureka Police Department officer on routine patrol the evening of Independence Day. The unnamed officer spotted several as-yet unspecified “racial statements” written at the intersection of Harris and California Street, according to the EPD release, and noticed Osborn, who had fresh paint on his hands.

As the officer approached Osborn, he ran away and the officer gave chase, leading to his arrest shortly thereafter. The officer noted that the fresh paint on his hands matched the paint written in the street.

Osborn was charged with a hate crime as well as the violation of the terms of his probation. He was additionally charged with vandalism and possession of a narcotic smoking device.

Tuesday, July 7, 2009

Firefighters check spread of Backbone Fire

Thirteen other fires under control in Trinity Alps

Humboldt Sentinel staff
7/7/09

Eureka

Firefighters today successfully checked the spread of a lightening-induced blaze already responsible for torching over 4,500 acres on Devil’s Backbone Ridge approximately 36 miles northeast of Willow Creek.

The Backbone Fire was previously two independent blazes, the Lower Trinity-17 Fire on the Six Rivers National Forest, and the Trinity Fire on the Shasta-Trinity National Forest. These combined into a larger conflagration thanks to hot weather conditions, density of brush and tough topography for firefighters to operate in.

Thirteen other fires triggered by lightening storms last week were contained over the weekend and are now in controlled status and continue to be patrolled, according to a release from Six Rivers National Forest. Firefighters working to control the fire in this remote wilderness must be extremely careful due to the hazard of falling snags as well as downhill line construction.

The National Incident Management Organization is assuming command of the fire under incident commander George Custer this week; his seven-member team is intended to provide a more customized approach for long-term fires in remote locations. Forest administrators justified this move as a way to reduce cost and provide a safer, more consistent fire containment strategy.

“The remote location of the fire in the Trinity Alps Wilderness, combined with the heavy dead and down fuels and standing dead snags from the Megram Fire, contribute to the fire's complexity,” forest supervisor Tyrone Kelley stated. “This has made fire suppression difficult.”

Crews in the last 48 hours have completed fire line construction into Horse Linto Creek and have also secured the line beyond Trinity summit, checking the spread of a 15 acre blaze in the Red Cap Creek drainage.

Forest officials are working closely with the Hoopa Tribe and keeping tribal members and fire service personnel updated on the Backbone Fire. Kelley met yesterday with Tyrone Kelley, newly elected chair of the Hoopa Tribe, to discuss the protection of cultural sites in the area. Forest officials stated afterwards that they are working to keep the fire away from the Hoopa Reservation boundary.

Several roads, trails and camps in the area have been closed due to fire conditions, including Horse Ridge National Recreation Trail, Salmon Summit National Scenic Trail, Mill Creek, Tish Tang, and Red Cap trails as well as Bear Hole, Grizzly Camp and the Willow Creek Big Rock Day Use Area.

While rafting on the Trinity River is still permitted, there is a “no stop zone” from the mouth of Willow Creek stretching one mile downriver, and forest officials ask visitors to float through with caution due to the helibase located there. Rafting and rafting guide services are still operating, and the interim Kimtu Beach access is open, along with the Hawkins Bar access point.

FIRE FACTS
Size: Approximately 4584 acres
Started: July 1, 2009
Resources threatened: no structures are threatened.
Active Fire Location: 36 miles Northeast of Willow Creek in Trinity Alps Wilderness
Resources:

* 9 hotshot crews
* 2 type II initial attack crew
* 1 helitack crew
* 1 Type 3 helicopter; 4 Type 2 helicopter, 5 Type I helicopters
* 1 engine
* 9 Water tender
* 322 Total personnel

Guard at county jail caught trafficking drugs

Benjamin Jentry-Rakestraw attempted to bring in heroin, tobacco, marijuana

Humboldt Sentinel staff
7/7/09

Eureka

On the heels of a month-long investigation of a correctional officer bringing contraband into the county jail, the Humboldt County Sheriff’s Office arrested one of their own this weekend on drug charges.

Humboldt County’s top cop expressed outrage at the news that a young Correctional Facility officer would bring shame upon the HCSO, which runs the county jail.

“As soon as we received information of a possible contraband smuggling problem we began a complete and thorough investigation,” Sheriff Gary Philp stated in a release. “A problem like this that involves a staff member is not only unlawful, it is also extremely disappointing to me and all other members of this agency who hold ourselves to a high standard of professional and ethical conduct.”

“This type of incident is a complete anomaly for us and is frankly a gross violation of trust to us as well as the public we serve and will never be tolerated.”

Sheriff’s investigators and jail staff initiated the investigation, which included surveillance and the service of three search warrants, after receiving information from an undisclosed source that an officer might be bringing contraband into their own jail.

On Friday at about 9:30 p.m., officer Benjamin Jentry-Rakestraw, a 20-year-old Fortuna resident, was stopped as he attempted to bring heroin, tobacco and other contraband into the jail. He was on duty at the time of his arrest, and booked into his own lock-up for bringing a narcotic controlled substance into a correctional facility, bringing contraband into a correctional facility, possession of a narcotic controlled substance, and possession of marijuana.

Jentry-Rakestraw’s bail was set at $20,000 and he is expected to be arraigned by Wednesday. This investigation is ongoing and additional arrests are expected; no other officers are suspects, according to the HCSO release.

Monday, July 6, 2009

Residents escape apartment complex blaze

Sunday’s three-alarm fire the latest in a series of Eureka blazes

Humboldt Sentinel staff
7/6/09

Eureka

Residents of an apartment complex escaped without injury after a three-alarm fire broke out in a second story unit last night, with the cause still under investigation.

At 9:21 p.m., Eureka Fire Department and Humboldt Fire District personnel responded to the report from 2979 Union Street of an apartment fire, and due to the potential for significant damage to the entire complex, additional local personnel and mutual aid engines from Arcata, Loleta and Blue Lake were also called to the scene.

With two hoselines brought to bear, firefighters brought the blaze under control and extinguished it without injury to themselves, although the fire damaged two apartments directly, caused water damage to a downstairs apartment and clouded the entire second floor with smoke.

As the apartment building was not inhabitable immediately following the fire, Humboldt County Red Cross also responded to help displaced victims locate temporary housing.

The Eureka Fire Department has had several residential structure fires in the past two weeks and urges community members to check for working smoke detectors inside their homes.

Anyone with information on the cause of the fire can contact EFD fire captain Chris Jelinek at (707) 441-4000 or cjelinek@ci.eureka.ca.gov.

Sunday, July 5, 2009

Arcata to appeal feds on recruitment

Eureka City Council will either join or bail on Tuesday

Charles Douglas, Humboldt Sentinel
7/5/09

Arcata

Apparently undaunted by a U.S. District Court slap-down of the Youth Protection Act last month, a bare majority of the Arcata City Council voted Wednesday to pursue an appeal to the Ninth Circuit, highlighting the increased tension between anti-war activists and an Obama Administration pushing Bush policies which mandate unfettered access to public schools by military recruiters.

“It’s to empower other cities and communities to look at their situation with their youth,” Councilmember Susan Ornelas said before the 3-2 vote.

She was joined in her support of the appeal by Councilmembers Shane Brinton and Alex Stillman; in opposition were Councilmember Michael Winkler and Mayor Mark Wheetley, who cited “limited fiscal resources” as the motivator -- despite most of the casework thus far having been produced by pro bono attorneys.

Approved as Measure F by 73% of Arcata voters, the YPA would have made it illegal for military recruiters to initiate contact with persons under 18 years of age. Eureka passed its own YPA in the same election last November by a closer margin of 57-43, and its City Council will face a similar decision in a closed session meeting starting at 5 p.m. on Tuesday.

The implementation of both initiatives was blocked after the Pentagon referred them to the Civil Division of the US Department of Justice in the waning days of the Bush Administration. Their civil action in federal court alleged the Supremacy Clause of the federal Constitution would render the local laws invalid in the face of the No Child Left Behind Act, which mandates military recruiter access to public schools which accept federal funding.

Although some of the peace activists associated with the initiative campaign group “Stop Recruiting Kids!” had hoped the federal action would be dropped with the departure of the Bush Administration, there has been no let-up from the DOJ in seeking to have the two laws stricken from the books.

“We're determined to appeal,” campaign organizer Jack Nounnan said. “We have a fine team of lawyers so believing in this cause as to be willing to waive any charges.”

Nounnan is hoping local anti-war activists will pack the normally sleepy pre-closed session public comment portion of the Eureka City Council meeting Tuesday to remind elected officials of the popular support these measures enjoy.

“Every time out in such obvious misuse of government power, we've got to take our stand against its control of our lives and remember how this undermines our local autonomy!”

To contact the local Measure F/Measure J campaign, visit www.stoprecruitingkids.org.

Saturday, July 4, 2009

Turning Crisis Into Opportunity

California's Empty Wallet

Ellen Brown
7/4/09


“Our wallet is empty, our bank is closed and our credit is dried up.”
– Governor Arnold Schwarzenegger, June 2, 2009

California State Controller John Chiang has warned that without a balanced budget in place by July 1, he will begin using IOUs to pay most of the state’s bills. On June 25, California Governor Arnold Schwarzenegger rejected a plan that would save the state $3 billion by cutting school spending, saying he would rather see the state issue IOUs than delay the funding problem with a piecemeal approach. The state’s total budget deficit is $24.3 billion.

Meanwhile, other funding doors are slamming closed. The Obama administration has said it will not use federal stimulus money to prop up California; and Fitch Ratings, a bond rating agency, announced that it was downgrading the credit rating of the state, which already has the lowest in the nation. Once downgraded, California’s rating is likely to fall below the minimum level legally required for most money market funds, forcing the funds to sell their California bonds. The result could be a cost of millions of additional dollars in higher interest rates for the state.

What to do? Perhaps California could take a lesson from the island state of Guernsey, located in the English Channel off the French Coast, which faced similar funding problems in the 19th century. Toby Birch, an asset manager who hails from there, tells the story in Gold News:

“As weary troops returned from a protracted foreign war [the Napoleonic Wars ending in 1815], they encountered a land racked with debt, high prices and a crumbling infrastructure, whose flood defenses were about to be overwhelmed . . . . While 1815 brought an end to the conflict on the battlefront, . . . severe austerity ensued on the home front. The application of the Gold Standard meant that loans issued over many years were then recalled to balance the ratio of money to precious metals. This led to economic gridlock as labor and materials were abundant, but much-needed projects could not be funded for want of cash.

“This led to a period of so-called ‘poverty amongst plenty’. . . . The situation seemed insoluble; existing borrowing costs were consuming 80% of the island’s revenues. What was already an unsustainable debt burden would need to be doubled to fund the two most essential infrastructure projects. This was when a committee of States members was formed . . . . The committee realized that if the Guernsey States issued their own notes to fund the project, rather than borrowing from an English bank, there would be no interest to pay. This would lead to substantial savings. Because as anyone with a mortgage should understand, the debtor ends up paying at least double the amount borrowed over the long-term.”

To prevent an unwanted inflation of the money supply, the Guernsey States issued the notes with a date due, and on that date the bearer was paid in gold. The money came from rents on the finished infrastructure, supplemented with a tax on liquor. Birch goes on:

“The end result of the Guernsey Experiment was spectacular – new roads, sea defenses and public buildings were established, fostering widespread trade and prosperity. Full employment was achieved, no deficits resulted and prices were stable, all without a penny paid in interest. What started as a trial led to a string of construction projects, which still stand and function to this day. Money was used in its purest form: as a convenient mechanism for oiling the wheels of commerce and development.”

Like Guernsey, California is facing “poverty amidst plenty.” The state has the eighth largest economy in the world, larger than Russia’s, Brazil’s, Canada’s and India’s. It has the resources, labor, and technical expertise to make just about anything its citizens put their minds to. The only thing lacking is the money to do it. But money is merely a medium of exchange, a means of getting suppliers, laborers and customers together so that they can produce and exchange products.

As has been explained elsewhere, today money is simply credit. All of our money except coins is created by banks when they make loans. The current crisis stems from a credit freeze that began on Wall Street in the fall of 2007, when banks were required to revalue their assets due to a change in accounting rules, from “mark to fantasy” to “mark to market.” Banks that were previously considered in good shape, with plenty of capital for making loans, suddenly came up short. Lending fell off, and so did the available money supply.

Just understanding the problem is enough to see the solution. If a private bank can create credit on its books, so can the mighty state of California. It merely needs to form its own bank. Under the “fractional reserve” lending system, banks are allowed to extend credit – or create money as loans – in a sum equal to many times their deposit base. Congressman Jerry Voorhis, writing in 1973, explained it like this:

“[F]or every $1 or $1.50 which people – or the government – deposit in a bank, the banking system can create out of thin air and by the stroke of a pen some $10 of checkbook money or demand deposits. It can lend all that $10 into circulation at interest just so long as it has the $1 or a little more in reserve to back it up.”

The 10 percent reserve requirement is now largely obsolete, in part because banks have figured out how to get around it. What chiefly limits bank lending today is the 8 percent capital requirement imposed by the Bank for International Settlements, the head of the private global central banking system in Basel, Switzerland. With an 8 percent capital requirement, a state with its own bank could fan its revenues into 12.5 times their face value in loans (100 ÷ 8 = 12.5). And since the state would actually own the bank, it would not have to worry about shareholders or profits. It could lend to creditworthy borrowers at very low interest, perhaps limited only to a service charge covering its costs; and on loans the bank made to the state, the state would ultimately get the interest, making the loans essentially interest-free.

Precedent for this approach is to be found in North Dakota, one of only three states currently able to meet its budget. North Dakota is not only solvent but now boasts the largest surplus it has ever had. The Bank of North Dakota, the only state-owned bank in the nation, was established by the legislature in 1919 to free farmers and small businessmen from the clutches of out-of-state bankers and railroad men. By law, the state must deposit all its funds in the bank, and the state guarantees its deposits. The bank’s surplus profits are returned to the state’s coffers. The bank operates as a bankers’ bank, partnering with private banks to loan money to farmers, real estate developers, schools and small businesses. It makes 1% loans to startup farms, has a thriving student loan business, and purchases municipal bonds from public institutions.

Looking at California’s budget figures, projected state revenues for 2009 are $128 billion. At a reserve requirement of 10%, if California deposited all $128 billion in its own state-owned bank, it could issue $1.28 trillion in loans, far more than it would need to cover its $23 billion budget shortfall. To lend itself the money to cover the shortfall, it would need only $2.3 billion in deposits and about $2 billion in capital (assuming an 8% capital requirement). What Sheldon Emry wrote of nations is equally true of states:

“It is as ridiculous for a nation to say to its citizens, ‘You must consume less because we are short of money,’ as it would be for an airline to say, ‘Our planes are flying, but we cannot take you because we are short of tickets.’”

As a card-carrying member of the banking elite, California could create all the credit it needs to fund its operations, with money to spare.

Ellen Hodgson Brown is the author of Web of Debt: the Shocking Truth About Our Money System and How We Can Break Free.

CCC sets up summer projects

Fire safety and park maintenance improvements expected

Humboldt Sentinel staff
7/4/09

Fortuna

Young men and women from across California will be in forest and parklands on the North Coast this summer to pitch in on fire safety efforts and other improvements.

The California Conservation Corps, in concert with the Northwest Youth Corps and Youth Conservation Camps, will be working across the Six Rivers National Forest on “projects that further the development and conservation of the nation’s natural resources” according to forest supervisor Tyrone Kelley.

In particular, the YCC will spend eight weeks in the Mad River watershed to clear brush, maintain hiking trails and campgrounds, and manage vegetation. The four youth involved will also learn about wildlife, archaeology, recreation and other subjects.

The CCC and NYC crews will work rehabilitating approximately 90 miles of hiking trails in the Siskiyou Wilderness, Marble Mountain Wilderness and the Lower Trinity.

Led by two staff, NYC-hired youth, ages 14 to 19, live and work as part of a ten-member team. The teams travel throughout the Northwest to complete a wide variety of projects such as stream restoration, trail construction, or habitat rehabilitation. The CCC is a state agency hiring 3,300 corps members per year between the ages of 18 and 25 who perform a variety of outdoor work.

For more information or to get yourself or your child involved in one of these programs, contact Julie Ranieri at (707) 441-3673 or jranieri@fs.fed.us.

Friday, July 3, 2009

Fire set in Winco bathroom

Damage from fire, water estimated at $5,000

Humboldt Sentinel staff
7/3/09

Eureka

Firefighters were summoned to the Winco supermarket early Thursday morning after automatic sprinklers activated in the store restroom in response to an alarm.

The responding Eureka Fire Department engine found a fire ignited inside the bathroom had been extinguished by the sprinkler system. According to the EFD release, the fire was intentionally set, and investigators are looking for more information.

After assessing the status of the fire, EFD proceeded to shut off the system to minimize water damage, while Winco staff engaged in water removal.

Although the sprinklers were restored to normal operating status, the bathroom suffered an estimated $5,000 of damage from fire and water. EFD credits the system, however, with saving the overall Winco property, with an estimated value of $5 million.

Anyone who can help EFD identify those responsible for the fire are urged to contact assistant fire chief Bill Gillespie at 441-4000 or bgillespie@ci.eureka.ca.gov.

Thursday, July 2, 2009

McCullen street fire still a mystery

Charred two-story house lacked electrical, gas services

Humboldt Sentinel staff
7/2/2009

Eureka

A house fire on the south side of town is still under investigation today, with some questions answered and others as yet unsolved.

Firefighters concluded their on-scene efforts late yesterday after extinguishing the early morning blaze at 1506 McCullen Avenue, and confirmed that no one remained within the charred two-story home. This alleviated early concerns, according to the Eureka Fire Department release, that voices were heard within the building prior to the blaze.

While the area of fire origin was discovered, the exact cause remains under investigation. Accidental gas leaks or electrical problems have been ruled out, as the house is not presently serviced by these utilities, leaving human activity as the likely cause.

Investigative efforts are now centered upon follow-up interviews, and members of the public have any information related to the blaze, they are asked to contact fire chief Eric Smith at (707) 441-4000 or esmith@ci.eureka.ca.gov.

Wednesday, July 1, 2009

Supes tap Atkins for rail authority

Incumbent Charles Ollivier passed over on split vote

Charles Douglas, Humboldt Sentinel
7/1/09

Eureka

Apparently, a dozen years with the North Coast Railroad Authority was enough for longshoreman and former Harbor Commissioner Charles Ollivier, who was replaced over his own objections and those of the public as Humboldt County Supervisors moved Tuesday to put a fresh face on the controversial board.

On a 4-1 vote and with vociferous objections from Supervisor Jill Duffy, the board tapped newly elected Eureka Councilmember Linda Atkins, a retired CalTrans worker, to fill one of Humboldt’s two spots with the NCRA, which also has representatives from local governments in Mendocino, Sonoma and Marin counties.

Atkins, who was not present at yesterday’s meeting, told Supervisors in her application letter that she saw rail as an opportunity to enrich the economy and increase tourism -- but a tell-tale line encouraging “trails with the rail” indicated the mounting test of will between advocates of restoring the entire Northwestern Pacific Railroad and those seeking to rip up the tracks in favor of a bicycle trail between Arcata and Eureka.

Supervisor Clif Clendenen, the other Humboldt County rep on the NCRA since shortly after his election last November, said the board had a variety of good candidates to choose from to entrust with an incredible asset like the railroad -- but then implied the need for increased trail construction to be met by himself and the new appointee.

“I’m excited to recommend Eureka City Councilmember Linda Atkins for this position,” he said. “She appreciates the multiple-use opportunities of our right-of-way.”

For his part, Supervisor Mark Lovelace was defensive about his support of the appointee in a closed-door nomination procedure, suggesting that the NCRA post was a regularly scheduled vacancy announced late last year.

“The current term of Commissioner Ollivier expires on [June] 30, so this is something that was expected, that was publicly posted and anticipated,” he said. “For my part I’ve given this a lot of diligence and reached out to everyone interested in serving.”

Lovelace also claimed he had either met with or spoken with all of the nominees, which included Arcata Councilmember Michael Winkler and former State Assemblymember Dan Hauser. This wasn’t sufficient to dissuade Duffy from launching into a pointed rebuke against her fellow Supes for backroom arrangements in dumping Ollivier.

“In this case, the way things are typically done with all of our appointments is we have a board report that is generated by the Clerk of the Board of the list of applicants and the applicants have the opportunity to present themselves…what I’m very uncomfortable with is that conversations were happening outside of the public process,” she said. “This is the first time that the Board is discussing this item in public and what I really want is what the different candidates offer, I don’t know what they have to offer and neither does the public, I want to know what their philosophies are, what their visions are and what their priorities are for the position.”

“What is this Board’s collective priorities for the North Coast Railroad Authority?” Duffy asked. “We haven’t had that conversation and now we’ve short-circuited the opportunity to have that conversation…it does create unnecessary tension and strife, it feels like a real slap in the face for all [Ollivier’s] energies and effort.”

Several members of the public stood up and essentially agreed with Duffy, calling for a more public process to select NCRA representatives and a general increase in the Supes’ support of restoring rail service to Humboldt County.

“I guess I have a vision for Humboldt County and that vision is to see some good paying jobs and I see the potential for the railroad in combination with portions of the harbor being redeveloped, acting in concert with each other to bring some industry to Humboldt County,” retired natural resources worker Ken Skaggs said. “There is a global economy that affects all of us and we could catch the advantages here of a global economy because Humboldt County is not an island unto itself.”

Increasingly uncomfortable in the face of public opposition and Duffy’s allegations, Lovelace shot back that Ollivier had not fully complied with his procedures to assess applicants for the NCRA seat.

“I was told by Mr. Ollivier that he was not interested in requesting re-appointment if there was any question about whether he be re-appointed,” Lovelace said. “I was told pretty clearly that his interest was in the re-appointment but not in sitting for an interview and not in sending in a letter of interest.”

Duffy retorted that she found that to be a “fascinating conversation” before being cut off by Board Chair Jimmy Smith, who then called Ollivier himself to the podium to clear things up. For his part, the longtime union man said his efforts were primarily directed at upgrading “antique” local infrastructure holding back economic development.

“I’m not here to be pushing a controversy, I’m only here to apply myself,” Ollivier said. “I do have a lot of experience and I thought I would be the candidate always with the proper knowledge to tie the railroad to the port. It begs us all to be developed!”

Atkins will take Ollivier’s place at the next NCRA board meeting, to take place in Eureka on August 12. For more information, visit northcoastrailroad.org.

Tuesday, June 30, 2009

Injured transient found on Trinidad roadside

Woman was cold and unresponsive, now in critical condition

Humboldt Sentinel staff
6/30/09

Trinidad

A woman is clinging to life in a local hospital after a passing motorist spotted a comatose body on the northbound side of Highway 101 this morning.

Humboldt County Sheriff’s deputies responded to the call at 6:30 a.m., and found an unnamed woman alive, but cold and unresponsive. When she was hospitalized, the 48-year-old transient showed significant bruising which may have been several days old, according to the HCSO release.

Deputies and California Highway Patrol officers are working to determine how the woman sustained her injuries, and anyone with information is asked to call (707) 445-7251.

Monday, June 29, 2009

Attempted murder in Hoopa

Sheriffs looking for Chevy pickup truck

Humboldt Sentinel staff
6/29/09

Hoopa

Deputies are looking for a Chevy pickup truck involved in a late night attempted murder which left a woman shot in the face.

According to the Humboldt County Sheriff’s Office release, deputies were called to a residence on Masten Flat off of Pine Creek Road at 11:30 p.m. yesterday, where they discovered a woman lying in the yard with a single gunshot wound in her face.

The victim, Kodi Elainna Downs, was hospitalized in critical condition -- but not before speaking to deputies about the incident. She reported hearing a woman’s voice from the passenger side of a truck which pulled up alongside her as she was walking to a friend’s house on Masten Flat. Downs was shot before being able to identify the woman, however, and the truck pulled away.

The HCSO is looking for a tan or brown four-door Chevy pickup, with the model year somewhere between 1998 and 2002. Anyone with information regarding this case is asked to call sergeant Wayne Hanson at (707) 268-3639.

Sunday, June 28, 2009

Budget cuts could cause ‘public safety emergency’

State crime lab funding on chopping block

Emily Witt, ProPublica
6/28/09

Sacramento

As California lawmakers tackle their state's $24 billion deficit, one little-known proposal on the table is a $20 million cut to the state crime lab.

That may not sound like much alongside the hundreds of millions in proposed slashes to the state's education, prison and health care systems. But it's half the lab's budget and would likely halt or delay the testing of rape kits, DNA and other crucial crime scene evidence in many counties, law enforcement officials warn.

The $20 million cut was approved by the state's budget committee last week and now goes to the entire legislature for approval. If it is passed, the lab would have to charge law enforcement agencies for tests it has always provided for free, even though many of those agencies are facing budget cuts of their own. Last year, the state lab tested evidence in about 50,000 cases, including more than 1,400 containing DNA.

Advocates for crime victims are urging lawmakers to reject the proposal, because they worry that delays in testing evidence will allow rapists, murderers and other violent criminals to remain on the streets.

"It's a public safety emergency," said Gail Abarbanel, who heads the rape treatment program at the Santa Monica-UCLA Medical Center. "The last thing that should be cut is public safety. I don't know what they're thinking."

Hundreds of police departments and district attorneys' offices in 47 of the state's 58 counties currently rely on the state lab to test their crime scene evidence. The other 11 counties, mostly concentrated in the Los Angeles and San Francisco areas, have their own labs to test forensic evidence.

But many law enforcement agencies in small or rural counties doubt they'll be able to afford the new charges, which are likely to run about $215 an hour. If the agencies can't pay, the lab will have to close some of its branches and lay off some of its scientists, said Jill Spriggs, the lab's bureau chief.

The agencies also could be forced to shelve thousands of DNA samples, bullet casings and other pieces of evidence used to identify violent criminals. There are already more than 350,000 untested DNA samples nationwide, according to federal government statistics.

Ultimately, some police chiefs said they might have to choose: pay to process evidence, or lose more cops on the streets. More than 1,000 police officers were eliminated statewide in the past year.

"I think that most law enforcement agencies would not be in a position to pay for those services," said Jerry Dyer, the police chief for the city of Fresno and past president of the California Police Chiefs Association. He estimated that the state lab's assistance to Fresno, which has some facilities of its own but relies on the state to process DNA evidence, amounted to approximately $1 million worth of testing last year.

Joe Grebmeier, a police chief from Greenfield, Calif., said his budget is already so tight that detectives are paying for crime scene supplies, including cameras, out of their own pockets.

"Decisions on how to proceed with investigations will now include, 'can we pay for it?'" said Grebmeier. "We might have to go to the public and have a fundraiser just to process a rape case."

Even in Los Angeles County, where the Los Angeles Police Department and the County Sheriff's Department have their own labs, DNA testing is in danger. Since May, the cash-strapped and understaffed Sheriff's office hasn't tested DNA evidence from thousands of rape and sexual assault cases, according to news accounts.

State budget officials acknowledged the danger the cut poses but said it is needed to keep the state from plunging even deeper into debt.

"We have had to make many difficult decisions to close our budget gap this year," said Noreen Evans, D-Santa Rosa, chair of the Assembly Budget Committee.

Dan Carson, of the state legislative analyst's office, which has recommended cutting the lab's funds for the last few years, agreed that "the easy choices are gone."

But Carson also defended the cuts, saying that it's unfair to allow 47 counties to get free services while others pay for their own crime labs. He said a state law already allows the lab to charge for testing.

"If this is a priority, one would assume they'll work out a way to do it."

But it could take years for a county to build its own lab or secure enough funding to pay the state. In the meantime, police and prosecutors could find it more difficult to send violent criminals to prison.

"Juries expect forensic evidence," said Spriggs, the state lab's chief. "When it's not there, cases could be lost."

Spriggs also noted that her lab "provides a very important service" to people wrongfully accused of crimes—those who rely on DNA testing to prove their innocence.

The proposed cut could go into effect between July 1 and Jan. 1, she said. It's unclear if it would be permanent. The entire state budget is likely to go to the full legislature for a vote on Wednesday.

When lawmakers debate the budget this week, Grebmeier, the police chief from Greenfield, suggested that they keep crime victims in mind.

"It's an academic discussion about these cuts and what we can afford and not afford until you look into the eyes of a victim or a family that's lost a loved one."

Saturday, June 27, 2009

Madoff Client Jeffry Picower Netted $5 Billion

Big winner likely made out with more than Madoff himself

Jake Bernstein, ProPublica
6/27/09

New York

It is rare these days to see Bernard Madoff's name in print unaccompanied by the word "Ponzi." Yet recent allegations raise the possibility of one key difference between Madoff's crimes and those of legendary con artist Charles Ponzi. While Ponzi's scam was under way, Ponzi himself was its biggest beneficiary. It now appears that the biggest winner in Madoff's scheme may not have been Madoff at all, but a secretive businessman named Jeffry Picower.

Between December 1995 and December 2008, Picower and his family withdrew from their various Madoff accounts $5.1 billion more than they invested with the self-confessed swindler, according to a lawsuit filed by the trustee who is trying to recover money for those Madoff defrauded.

In contrast, shortly after he confessed, Madoff declared his household net worth to be between $823 and $826 million, according to court documents. While the Madoffs clearly lived opulently, no evidence has emerged that their combined assets and expenditures approached the amount the Picower family is alleged to have withdrawn from the scheme.

In an era when billions of dollars are being tossed about in financial collapses and government bailouts, remarkably little attention has been paid to Jeffry Picower's extraordinary success with Bernie Madoff. If Picower has penetrated the popular consciousness at all, it is as a Madoff victim. The victim narrative is buoyed by testimonials from the nonprofits who received funding from his charitable foundation – which quickly closed on the heels of the swindler's confession. For this reason, ProPublica decided to take a closer look at both Jeffry Picower and the complaint filed against him by Madoff trustee Irving Picard.

Fortunately for the trustee and the federal investigators presently swarming over the case, Madoff apparently kept detailed notes of communications between his office and his clients. But despite this documentary evidence, which is cited but not provided in court documents, Picard's complaint raises more questions than it answers. Above all, what was the exact relationship between the two men? The complaint is larded with the legal catch-all phrase, "knew or should have known," to describe Picower's cognizance of Madoff's fraud, but the intricacies of the relationship are left to the imagination.

One question is the role that Picower's charitable giving played in all of this. The amount Picower withdrew for his foundation is separate from the quarterly withdrawals for his personal accounts. During the 1995-2008 time span, Picower took out about $291 million from Madoff for the foundation account. During the same period, the foundation doled out more than $235 million in donations, according to tax forms.

Perhaps the most pertinent question: If Picower withdrew $5.1 billion in "profit" from Madoff, where did all the money go? The Picowers own a home in Palm Beach that is appraised at a little over $28 million. They also have a 28.4-acre compound in Connecticut valued at $4.5 million. A search of numerous online sources, both aggregate databases and county property records for the couple, their daughter, and the companies named in the complaint, reveals few other major assets. If someone needed the skills to hide billions of dollars, few would be better equipped than Picower, an attorney and accountant who has been described as a "tax shelter expert." Even so, it's curious our search did not even uncover a boat or plane under the Picower name.

Messages left for Picower and his wife Barbara requesting comment for this story were not returned. Their lawyer, William Zabel, declined to comment to ProPublica on the Madoff matter. Earlier, Zabel told The Wall Street Journal that the couple "were in no way complicit in" Madoff's scheme.

Emailed questions to David Sheehan, an attorney at Baker & Hostetler who is working alongside Picard on the case, went unanswered.

Picower, 67, began his career as an accountant and lawyer in New York but seems to have made much of his fortune as an investor in the medical industry. He has avoided media interviews and, with a few notable exceptions, succeeded in keeping a low profile. If the Picowers were recognized at all, prior to their Madoff notoriety, it was through praise for their philanthropy. Yet even here, their ties to Madoff loomed large. The growth of their largest foundation was attributed to their Madoff investments. Madoff himself served as a trustee on another Picower foundation.

The court-appointed trustee makes a powerful, albeit still largely circumstantial, case in court filings that Picower knew Madoff's fund was illegitimate. Although Madoff ostensibly produced eerily consistent 10-12 percent annual returns for his clients, the returns he provided Picower were other worldly:

■In 14 instances between 1996 and 2007, a group of Picower trading accounts experienced annual returns of more than 100 percent. On 25 occasions, the annual return exceeded 50 percent. During this same period, the biggest annual gain in either the Dow Jones Industrial Average or the S&P 500 was 31 percent, for the S&P in 1997. The S&P 500's annual average for that period was slightly under 9 percent.
■The annual rate of return for two of Picower's regular trading accounts in the four years between 1996 and 1999 ranged from about 120 percent to more than 550 percent annually.
■In 1999, one account earned 950 percent.

Each quarter, the Picowers would withdraw various sums from Madoff from different accounts. Usually the total for each quarter’s withdrawals amounted to round numbers. Click to see the full listing of the Picowers' withdrawals from Madoff accounts. [5]Picower belonged to a select group of Madoff investors who received souped-up returns. A Wall Street Journal story [6] published in May cited unnamed sources saying that prosecutors were looking into eight investors who appear to have received special treatment from Madoff. Among the eight named, Picower seems to have withdrawn the most money, with the bulk of it coming from an account called "Decisions, Inc." According to the Madoff trustee's court filings, "the account reflected little trading activity and relatively few holdings," yet Picower took hundreds of millions out of it. At the time of Madoff's arrest, the account had a reported negative net cash balance of more than $6 billion.

At the beginning of each quarter, the Picowers received sums that grew from an annual total of $330 million in 1996 to $1 billion in 2003. These withdrawals were divided into odd numbers spread over various accounts. Added together, they usually equaled large even sums. For example, on January 2, 2003, Picower withdrew $1,378,852 from his account Jln Partnership. Yet when withdrawals across all accounts were totaled for that day, they amounted to precisely $250 million.

Picower's quarterly withdrawals reached their zenith in 2003 and then decreased by half the next year, eventually dropping to their lowest point in 2006. For some reason, the quarterly withdrawals totaled an uneven $16,975,422 in 2006, only to rebound to exactly $40 million in 2007.

Picower's extraordinary gains do not appear to have been achieved at random. The trustee's complaint details how Picower, often acting through a subordinate, ordered up "returns" which Madoff's office then delivered. In some cases, Picower is alleged to have requested backdated returns for trades or sales of securities.

■On April 18, 2006, Picower wired $125 million to Madoff to open a new account. Madoff's office began "purchasing" securities in the account, but "it backdated the vast majority of these purported transactions to January 2006" when the stock market was at its lowest for the period, according to the complaint. Twelve days later, the net equity value of the account was $164 million, a gain of $39 million – or more than 30 percent – in less than two weeks.
■The complaint details conversations between Picower associate April Freilich and Madoff's office beginning around May 14, 2007, when Freilich stated that the Picower Foundation needed gains during January and February of 2006, a year earlier.
■On May 18, Freilich specified that the foundation needed "$20 mil in gains" and "want[ed] 18% for year[] 08 appreciation" for January and February of that year. Five days later, Freilich changed the amount to $12.3 million. Subsequent statements reflected gains of $12.6 million.
■On December 22, 2005, Picower or Freilich allegedly faxed a letter to Madoff dated December 1, directing him to sell specific holdings. The statement for that month reflects that the sales were finalized on December 2, a process that typically takes three days. The clues that the letter was back-dated: A fax with the tell-tale December 22 date and an attached portfolio appraisal dated December 16 that included the positions that were supposedly "sold."
■On or around December 29, 2005, Freilich allegedly faxed a letter to Madoff asking for $50 million in gains across certain accounts. Subsequent statements generated by Madoff for the accounts show stock sales, presumably to satisfy the request, that were supposedly recorded around December 8 and 9, 2005, approximately three weeks prior to Freilich's letter.
Who is Jeffry Picower?

The Picowers' generosity to deserving charities, particularly in New York, Florida, and Massachusetts, has earned them admiration and respect. However, the image belies a more complex reality.

The Picowers gave to a host of worthy causes from the Children's Aid Society to the New York City Ballet, but Jeffry Picower's passion centered on health issues, particularly funding for medical research. On December 1, 2005, the couple made a rare public appearance at a ceremony at the Massachusetts Institute of Technology to dedicate a new center to study the brain, the Picower Institute for Learning and Memory. The Picowers' gift of $50 million, spread over five years, was the single largest from a private foundation in the school's history. In a video of the ceremony, Nobel Prize winning Japanese scientist Susumu Tonegawa told the crowd that without the Picowers there would be no institute. The Picowers stood by silently as Tonegawa unveiled a portrait of the couple to conclude the ceremony.

The gift to MIT was the largest single donation to an outside entity the Picower Foundation had ever made, according to tax forms the foundation filed. Prior to late 1995, when Madoff trustee Picard's records start tracking Picower's Madoff activity, the Picower Foundation was relatively small in size and scope. At year's end in 1994, it had assets of just under $75 million and had donated $375,754. By 2007, it was reporting about $958 million in assets and about $23.4 million in donations for the year.

Picower's attention to cutting-edge medicine was the sole focus of a second foundation, The Picower Institute for Medical Research, created to find cures for human diseases. He launched the Institute in 1991 with a $10 million donation from the Picower Foundation. Madoff served as a trustee of the Institute.

In 2001, the St. Petersburg Times revealed that Picower used both his foundations and a private corporation called PharmaSciences, of which he was the majority shareholder, to gain control of a potentially lucrative medical discovery. In 1999, Picower merged PharmaSciences with a for-profit spinoff of his institute called Cytokine Networks, essentially negotiating with himself. The merged company called Cytokine PharmaSciences had the rights to develop a new drug that could help minimize such illnesses as arthritis and multiple sclerosis. The newspaper raised the question of whether Picower had shortchanged his nonprofit in the deal.

An IRS audit concluded that the Picower Foundation had not jeopardized its tax status or incurred extra liability during the period in question. The Foundation's lawyer William Zabel provided ProPublica with a letter from the IRS dated September 2006 that he said "cleared the Foundation." Addressed to Barbara Picower, the letter is from the IRS' Office of Exempt Organizations and formally accepts the Foundation's tax returns. Zabel also said that shares Picower received from the merger were given to other charitable organizations.

The publicity-shy Picower is no stranger to lawsuits or regulators, a trip through several decades of legal and regulatory filings reveals. In 1984, the SEC cited him for a late disclosure over how much he owned in a company called Bradford National Corporation. The SEC filing alleged that Picower was part of a scheme to take over the company.

A year later Picower had to pay out a $21-million settlement when shareholders sued over the collapse of Physicians Computer Network. Picower controlled 45 percent of the stock and chaired the company before it went belly up. In 1989, Picower paid an undisclosed settlement over a questionable tax shelter he helped set up years earlier for a client. In 1990, it was Picower's turn to recover money – from a settlement involving infamous insider trader Ivan Boesky. Picower had been one of his investors.

Perhaps the most revealing case against Picower was a lawsuit filed for failure to pay for renovations on his New York office. Picower alleged that general contractor McHugh, DiVincent Alessi had done such a bad job on his office that the toilets didn't even flush properly, according to Jeremy Morley, the firm's lawyer at the time. Rather than take Picower at his word, the judge decided the jury members should see for themselves. Arriving by city bus from the courtroom, the judge, with jury in tow, made a surprise visit to Picower's office.

"The jury wandered around, looking at the office, testing the toilet," Morley said. "They quickly realized that the case was full of crap in more ways than one."

The judge awarded Morley's client what Picower owed them and some of their attorney fees, according to the lawyer.

Picower's legal and regulatory history was outlined in an article by Forbes Magazine. The 2002 article, which didn't mention Picower's activities with Madoff, said Picower was "worth at least $300 million." That same year, the trustee reports, Picower's quarterly withdrawals from Madoff totaled $895 million.

ProPublica Research Director Lisa Schwartz and Kitty Bennett contributed to this report.

Friday, June 26, 2009

California commercial fishing in jeopardy

New data shows many fisheries running losses

Paul Mann, Humboldt State University
6/26/09

Arcata

Many California fisheries are running losses, the number of licensed commercial fishermen is plummeting and the port and harbor infrastructure that supports them is underfunded as the industry shrinks, according to an in-depth economic analysis commissioned by the California Department of Fish and Game from Humboldt State University.

The findings suggest that without major management changes, commercial fishing could meet the same fate as Santa Clara County’s extinct truck produce and processing industry and Sonoma County’s withered apple sector.

Commercial salmon fishing, which has suffered recently from limited seasons and outright closures, is far from alone in the industry’s plight, according to statewide data analyzed by Humboldt State Economics Professor Steve Hackett, his research associate, Doreen Hansen, HSU undergraduate researchers and the Maryland consulting firm King and Associates. Although Dungeness crab fishing is strong on a cyclical basis, money-losing operations include such fisheries as harpoon/spear, hook and line, near shore and ground fish trap, sea urchin and southern California trawl.

Persistent revenue losses have shrunk the industry dramatically. Department of Fish and Game sales of commercial fishing licenses of all types sank 31% from 2000 to 2008, dropping from 26,049 to 18,052, according to Terry Tillman, a senior biologist and fisheries economist at the department.

Correspondingly, Hackett said, “The number of vessels in the industry has shrunk substantially across the whole state, the average age of commercial fishermen is getting older and a lot fewer people are engaged in commercial fishing. All this results in a struggle for funding to maintain the harbor and port infrastructure the industry is dependent on.”

Strong competition is in play as well. The commercial sector duels for catch with private sport fishermen, intensely so in southern California. Meanwhile, competition for fishing grounds is heightened by marine protection initiatives and the likelihood California will deploy wave energy conversion systems at sea to gain alternative electrical output.

“What you have is a constellation of policy challenges besetting commercial fishing,” Hackett emphasized, noting a corrosive feedback effect. “When it’s so hard to fish commercially and you don’t have enough fishermen, then the fish processors begin to fall by the wayside. And without them, you can’t have a commercial fishing industry. It’s very similar to what happened with truck produce and processing in Santa Clara County, which was completely eliminated by urbanization. Same thing with apple processing in Sebastopol and Sonoma County: the industry shrinks, you lose the processors and then eventually the rest of the industry goes away.”

Tillman said the new economic analysis could be a crucial underpinning for bold management actions to restore the industry’s health. “In some instances, bold action may even be for [state and federal] management to let the industry operate with more flexibility, as an unfettered or unencumbered business enterprise,” he said in an interview. “Of course, there have to be biological constraints that the department, as a custodian of a public resource, needs to keep tabs on. But as long as we have acceptable fishing practices and sustainable levels of fish, there may be room to allow the fishing fleet to operate more profitably.”

Many other states and countries have taken that direction under fisheries quota programs, he said, but California has not been in the forefront.

The analysis and companion files are titled “The Economic Structure of California’s Commercial Fisheries,” available at http://www.dfg.ca.gov/marine/economicstructure.asp

Thursday, June 25, 2009

Arcata cops raid 215 grow

Daniel Carbonneau popped for cultivation despite doctor’s recommendation

Humboldt Sentinel staff
6/25/09

Arcata

A local man was arrested today at the scene of a moderate-sized marijuana grow in Sunny Brae by Arcata Police Department officers acting in concert with the Humboldt County Drug Task Force.

A search warrant was served this morning at a residence and storage building on the 1100 block of Old Arcata Road by APD, DTF and agents of the Drug Enforcement Unit run by the Humboldt County Sheriff’s Office. According to the APD release, the warrant targeted a “criminal marijuana growing operation” following complaints from unnamed members of the public -- although the presence of doctor’s recommendations under the auspices of Proposition 215 were apparently ignored.

Arcata resident Daniel Carbonneau, 38, was arrested without incident at his home, and booked into the county jail on illegal cultivation charges. Police estimated the catch at approximately four pounds of cannabis bud, and 275 growing marijuana plants were also seized.

APD officials alleged that the electrical wiring in the buildings was faulty and had been modified in such a way as to create a significant risk of fire, and used their assessment to bring in building code officials from City Hall. Their inspection resulted in a request to Pacific Gas and Electric to cease service to the address due to unsafe electrical conditions, and power was cut off shortly thereafter.

Wednesday, June 24, 2009

Gunshots inflict major damage on comm tower

State parks building also vandalized, suspect remains elusive

Humboldt Sentinel staff
6/24/09

Shelter Cove

Construction workers at a new U.S. Coast Guard communications tower returned to work Tuesday morning to discover severe damage to the facility and the neighboring State Parks building.

Humboldt County Sheriff’s deputies are looking for information about those responsible for firing several high-powered rifle rounds into the radio tower, damaging one of the support legs. The construction company manager estimated damage at $100,000; several shots fired at the State Parks building caused an estimated $10,000 worth of damages.

The 120-foot tower, located within a fenced compound at the intersection of Kelly and Toth roads in Shelter Cove, is on federal property. The State Parks building houses radio communication systems for state and local fire and law enforcement agencies.

The attack probably took place after 9 p.m. Monday, as construction workers were on site until sundown. HCSO deputies recovered about 25 shell casings nearby, and are looking for more information -- the public is urged to come forward with any details by calling the HCSO at (707) 445-7251.

Transportation chiefs talk turkey

RCAA decries lack of ongoing support for bike trails

David Courtland, Humboldt Sentinel
6/24/09

Eureka

Regional state and county transportation officials talked about funding challenges to projects at a Wednesday town hall meeting in the Eureka Marina’s Wharfinger Building.

The California Transportation Commission held the well-attended meeting, hosted by the Humboldt County Association of Governments, to hear public comments as well as presentations by officials.

Humboldt County public works director Tom Mattson said that like every county in Northern California, Humboldt needs much more money for current projects than is available.

Mattson said about every two years the department has to deal with declared disasters like floods, on top of maintaining 1,207 miles of roads and 167 bridges at an annual cost of $100 million.

Asked how proposed county budget cuts will affect his department, Mattson said it could continue with its current projects for about a year.

“The current budget proposals call for deferring funds, we’re fighting that diversion,” said Mattson, adding his department has about $900,000 in reserve. “That second year, I don’t think I can get through it, I don’t think any county can.”

Jennifer Rice of the Redwood Community Action Agency said that while she is generally able to get grants for community projects such as bicycle trails, there is virtually no ongoing state mechanism for funding non-motorized transportation.

Arcata mayor Mark Wheetley presided over the forum, which also included presentations from Del Norte, Trinity, Mendocino and Lake county officials. Wheetley suggested holding transport-focused town hall meetings more often in Humboldt County, as the area’s unique challenges have less to do with traffic congestion as compared to the rest of California.

Tuesday, June 23, 2009

Three busted for roadside heist

Marijuana sale goes south when guns get pulled

Humboldt Sentinel staff
6/23/09

Redway

A Southern Humboldt man’s plan to sell some marijuana went horribly wrong Saturday when his prospective buyers brandished firearms and led him on a high-speed chase, catching the attention of law enforcement.

Shortly after a 12:45 p.m. report of gunshots being fired on Redwood Drive in Redway, Humboldt County Sheriff’s deputies were sent to help California Highway Patrol officers.

Deputies joined the CHP officers at the Mendocino and Humboldt county line, where they were talking to Robert Anthony Mendez, 23, of Redway.

Mendez said that during a marijuana sale on Oakridge Road at Redway Beach, one of his buyers pointed a handgun at his head and another holding a rifle took his wallet—and the marijuana—before leaving in a car driven by a third suspect.

As Mendez chased them in his car the driver hit her brakes near Dean Creek on Redwood Drive, causing Mendez to rear-end the car. The passenger with the handgun fired several shots at Mendez’s car.

Mendez continued to chase his assailants, who were throwing things from their car. His car broke down on Highway 101 near Dean Creek as Mendocino County deputies and the CHP had already stopped the suspects’ car and arrested them for robbery.

Mendocino County deputies busted the thieves, Nicholas Bradford Brown, 19, of Sherman Oaks; Rayshaun Antowina Brock, 28, of Inglewood and Amber Capri Wendorf, 20, of Chatsworth. All three were taken to the Mendocino County jail and will be transferred to the Humboldt County jail later.

Deputies could not find the semi-automatic rifle, but several pounds of marijuana tossed from the robbers’ car were found along the roadside. Two civilians found Mendez’s wallet in the roadway and turned it in. No injuries were reported.

Driver flees, passenger arrested at traffic stop

William Lee Nicholson of Eureka sought for parole violations, new charges

Humboldt Sentinel staff
6/23/09

Eureka

At about 5:30 p.m. Friday, June 19, an Eureka police officer stopped a white Buick sedan near the intersection of Hawthorne and A streets for a traffic violation. The driver, William Lee Nicholson, 29, of Eureka, gave a fake name and seemed nervous. Hearing the officer ask for backup, Nicholson suddenly fled through the passenger door.

The officer chased Nicholson but lost sight of him when he ran into an alley about a block away. The officer returned to his patrol car just in time to see Nicholson’s passenger, Katrina Marie Gerace, 23, drive away eastbound on Hawthorne.

Gerace was stopped a short time later near Carson and G streets, where she was busted for not obeying an officer. Searching the Buick, officers found several Vicodin and methadone pills, some marijuana and a stolen digital camera.

Gerace was taken to the Humboldt County jail and booked for felony possession of stolen property, possession of a controlled substance and failure to obey a traffic officer.

Officers were unable to find Nicholson, who is on parole for drug violations. A warrant for his arrest is being sought for possession of stolen property, possession of a controlled substance, driving on a suspended license and providing a false identity to a peace officer.

Anyone who knows Nicholson’s location is asked to call the Eureka Police Department at 441-4044 or 441-4060.

Monday, June 22, 2009

HSU geographer named top scholar

Steve Cunha recognized for Central Asia expertise

Paul Mann, Humboldt State University
6/22/09

Arcata

Humboldt State University President Rollin Richmond has accepted a faculty panel's recommendation of award-winning Geography Professor Stephen Cunha to be the 2009 Scholar of the Year.

In accepting the recommendation, the President said, "Professor Cunha is a natural choice. While he is an internationally known and respected scholar with a fascinating background, he is also a teacher with a real passion for his discipline. Humboldt State students recognize his commitment, and his classes here are much in demand."

The Advisory Board for Research and Creative Projects, appointed by the Academic Senate, called Cunha "an internationally known expert on the geography of Central Asia and a national leader of K-12 geographic education."

"The real honor," Cunha said, "is to be included among Humboldt State's finest teacher-scholars. Their collective erudition in science, art, humanities and social science defines and supports our educational mission. The field work, writing and professional meeting presentations kick my work with students up a notch. Scholarship is the score, teaching and student advising are the performance."

Cunha added, "I've always felt lucky to turn a youthful passion into a lifelong career, and to work with motivated HSU students who share that interest."

As for the Outstanding Scholar Award itself, Cunha said, "My cartographer wife Mary deserves at least 51% of it."

Prior to joining HSU in 2001, Cunha served 10 seasons as a park ranger in Yosemite and Alaska and four years examining the potential for a national park and biosphere reserve in the Pamir Mountains of Tajikistan in Central Asia. They are famed as Marco Polo's "Roof of the World."
A graduate of UC Berkeley and UC Davis, Cunha is the director of the California Geographic Alliance. Under his leadership, the organization has involved more than 75,000 of the state's teachers in various instructional activities in a concerted drive to offer more effective geography education. He and his alliance partners have secured more than $3 million in grants in the last 10 years to advance geographic literacy and education in the state. In 2007, the alliance and its partners won a $1 million start-up endowment from the David & Lucille Packard Foundation and the National Geographic Society to allow the alliance's efforts to continue in perpetuity.
Cunha himself has received many major grants for his scholarship, including funds from the Bechtel Foundation, the California Department of Education, the University of California and the Richard and Rhoda Goldman Fund.

Since the inception of the National Geography Bee in 1989, Cunha has worked closely with the National Geographic Society to expand the contest, and California now has the largest bee in the nation. More than 100,000 of the state's fourth through eighth graders compete each year, led by Cunha as state coordinator. He assists schools, presides over the state final each spring and, with HSU's Mary Hackett, maintains the state office in Arcata. This July, he is the backup to Jeopardy host Alex Trebek at the National Geographic World Geography Championships in Mexico City. The three-day competition involves student winners from 21 countries.

A prolific author, Cunha writes for diverse audiences-children, young adults, the general public and scholars-in textbooks, journals, encyclopedia entries, government reports and book chapters. Often they are illustrated with photographs from his frequent world travels. This year he is a contributor to the five-volume Encyclopedia of Asia.

Both of his National Geographic books, Our 50 States and The Official National Geographic Bee Study Guide, reached Amazon Children's best seller list. He has co-authored social studies and science textbooks for grades two through high school, and consulted on more than 75 National Geographic Society books, maps and magazine articles.

Cunha was one of five 2007 recipients of the $20,000 California State University Wang Family Excellence Award, which recognizes outstanding faculty and administrators. That same year, he won the Hilda Taba Award from the California Council for Social Studies for outstanding and enduring contributions to social science education in the state. In 2001, he was selected for the Distinguished Teaching Award of the National Council for Geographic Education.