Reasons to support extension for developer
Publisher’s note: This was written by SLT Councilman Hal Cole prior to the March 2 decision by the bankruptcy court to give Randy Lane until June 2 to come up with an plan, but was received by LTN on March 3.
By Hal Cole
Much has been made lately about a possible investor for the stalled Convention Center project. I offer the following observations on the likelihood of any progress in the bankruptcy courts and on the action the City Council took on Feb. 15.
Currently the project site consists of 29 separate parcels owned by 17 different entities — the creditors. All of them are owed money by the developer Randy Lane dba Lake Tahoe Development) and are secured by deeds of trust. When the developer stopped paying on the notes, the creditors filed notices of default, which is the first step in foreclosing.
Hal Cole
On Oct. 5, 2009, Mr. Lane filed for protection in bankruptcy court. During the first 120 days of bankruptcy, the developer has the exclusive right to propose a plan to settle with the creditors and emerge from bankruptcy. This period expired on Feb. 2. Mr. Lane has asked the court for an additional 150 days to prepare his plan. On Feb. 9, the City Council met to discuss our position on his request and decided to write an opinion letter to the court opposing any extension. The council was also informed that Mr. Lane had a potential investor, Michael Rosenfeld, who wanted to meet with the mayor and me. By consensus, the council directed staff, the mayor and myself to meet with Mr. Rosenfeld and, if there were sufficient evidence of his ability to finance the project, the council was to meet again to reassess our position, hence the meeting on Feb. 15.
At our meeting, our city attorney presented us with four options:
1. Support Mr. Lane’s request to extend for an additional 150 days his exclusive right to present a plan to satisfy the creditors and build the project;
2. Remain neutral and make no recommendation to the court on his request;
3. Oppose his request altogether;
4. Support an extension for a shorter period of time.
It was my feeling that this was the first time any viable investor had come forward to build the project and that allowing a shortened period of time for his plan to be presented to all of the creditors and the court was the appropriate action for our council to take. Other council members felt that Mr. Lane had been given enough time already and wanted us to recommend no extension of time at all.
On a 3-2 vote, with council members Bill Crawford and Jerry Birdwell in opposition, the City Council agreed to write a letter supporting an additional 30 days for Mr. Lane and Mr. Rosenfeld to meet with the creditors and present their plan. After the project had languished for years with no apparent outside interest, I felt an additional 30 days would not significantly delay the ultimate outcome, but could reap the result our whole town is hoping for: a completed hotel/retail/convention center complex.
No matter what the court ultimately decides, one thing is certain, time is running out for Mr. Lane and some movement will occur soon. Whether it results in the foreclosure by 17 property owners or an emergence from bankruptcy with a new developer remains to be seen. I look forward to working towards the latter outcome and hope the economy is on the rebound and we can rebuild our city.
Hal Cole is mayor pro tem of South Lake Tahoe.
Thanks for explanation.
P.S. Move to consolidate essential services-will save money.
Mr Cole,I don’t think a lot local residents believe a word to say anymore. You , Upton, took it upon yourselves to sign a go ahead deal on a agreement without proper finance in place.You’ve been a contractor for many years, both You and John, knew better business practices when it comes to your own well being with your own business.Why not in the case MR. Cole? Your short sightedness
has cost the people who live here many lost dollars of revenue.
Why did you do this?
I do believe You and Mr Upton own the residents of So.lake Tahoe a public apology for being so short sighted .
You might end up winning this fight but you lost the war,respect, to many who live here.
Swing vote John and his batboy involved in another strike out.
Remember when John struck out when he attempted to get rid of Meeks. The Tahoe Trib had quite a story on his crafty design. Oh well, thats just John being John
Alex Campbell,
When did John try to get rid of Meeks, and if true, why didn’t he push to allow the Do It Center in with lumber sales to give meeks some competition? And does anybody know what’s up with the scaled down Do It Center?
Why isn’t this a top story? Thank you Mr. Cole for the details. We complain we never get answers and then when someone explains they get skewered for it so I won’t do that. More explanations and information from everyone would be helpful.