NO on L: The campaign against Pacifica’s Measure L

Because the Quarry property contains an inactive mine, the State Mining and Geology Board (SMGB) requires that it be reclaimed. In May, 2005 the SMGB approved a "financial assurance amount of $1,319,476" (PDF file), and notified the Bottoms Family Trust, at the time the property owners, of this decision. A Notice of Violation was issued August 19, 2005, followed by an Order to Comply on September 22, 2005.

On November 4, 2005, well after the close of escrow on July 29, 2005, the SMGB was notified that the Quarry was sold to Rockaway Beach Ltd., a Florida limited partnership. One condition of the close of escrow was that the new owners take over the obligation.

At its January 12, 2006 meeting, the SMGB moved the deadline for the posting of an acceptable assurance instrument to January 19, 2006. One day after the deadline (January 20), the SMGB did receive a letter of credit, but it could not be accepted because it was not consistent with SMGB guidelines. One problem was that the letter was provided by Northern Trust of Miami, Florida, without any documentation that the bank was registered with the State. Because of the deficiencies, the SMGB, at its February 9, 2006 meeting, issued an administrative penalty in the amount of $50,000.

Ultimately, the SMGB did receive an acceptable letter of credit, and at its May 12, 2006 meeting the board rescinded the fine and accepted the financial assurance instrument.

Despite the fact that the staff recommended penalties that were a tenth the size of the maximum allowed by law ($50,000 vs. $665,000), on March 13, 2006, Peebles' partnership, along with the Bottoms estate, sued the State Mining and Geology Board. As of July 13, 2006, Peebles' lawsuit against the SMGB was still on the docket and was discussed (PDF file) by the SMGB in closed session.

The bond was eventually paid, at which time the State Mining and Geology Board rescinded the fee. In turn, Peebles and the Bottoms Trust dropped the suit.

Says the State Mining and Geology board now:

The $50k penalty was levied against the Pacifica Quarry operator, the Bottoms Family Trust. It was never transferred to the new owner since the new owner was not the operator. Regardless, the penalty was eventually rescinded when a financial assurance instrument in the amount of $1.3m was received and approved by this Board.

The Peebles group did file action against the Board, as a precautionary step to ensure their rights as the new property owner, but the suit was quickly withdrawn when the Board approved the financial assurance mechanism.

The City of Pacifica regained their Lead Agency status shortly thereafter, and this matter is now closed to the Board's satisfaction.