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WatchSonoma Watch

CalPERS to move ahead with Preservation Ranch

By BRETT WILKISON

THE PRESS DEMOCRAT

CalPERS, the giant state workers pension fund, has ended several months of uncertainty by signaling to Sonoma

County that it intends to move forward with a huge, controversial timber-to-vineyard conversion project near Annapolis.

Called Preservation Ranch, the project would clear up to 1,769 acres of forest for wine grapes on nearly 20,000 acres in northwestern Sonoma County.

It is said to be the largest forest conversion project for agriculture in California in generations. Currently in the study stage, it has drawn nationwide opposition from environmentalists and others concerned about impacts on water resources and wildlife, including struggling salmon and steelhead populations in the Gualala River watershed.

For years, the California Public Employees Retirement System has owned a majority stake in the project through a $200 million investment in vineyard portfolios overseen by a Napa-based vineyard management firm.

But CalPERS last year severed its ties with that firm, Premier Pacific Vineyards, and Sonoma County officials have since been looking to confirm who controls the future of Preservation Ranch.

The answer is CalPERS, state pension fund officials said last week in a letter to the county.

“As of January 1, 2012, the California Public Employees’ Retirement System is the owner of Pacific Vineyards Partners LLC,” Judy Alexander, CalPERS portfolio manager, wrote in the letter.

Pacific Vineyard Partners is the investment portfolio that controls landholding subsidiaries for Preservation Ranch.

The notice came as CalPERS holds exploratory talks with at least one conservation group on the possibility of selling the sprawling ranch or a conservation easement on it, sources said.

Wayne Davis, a CalPERS spokesman, confirmed the discussions but declined to say if the property was for sale.

CalPERS’ letter to the county, however, signaled the pension fund’s intent to move forward with the project. It designated Jeffrey Redding, a former Napa County planning director and consultant, and Tom Adams, a former Premier Pacific Vineyards land-use director, as local representatives for Preservation Ranch.

Eric Koenigshofer, a former Sonoma County supervisor who worked as a consultant and attorney for the project, is not currently involved, though he might be brought on in the future, Redding said in an interview.

“We’re not stopping the process. It’s moving forward,” Davis, the CalPERS spokesman, said Monday.

The $233.7 billion pension fund has switched overall management of its vineyard portfolio, including 19 vineyards in California, Oregon and Washington, to GI Partners of Menlo Park.

CalPERS’ moves come at a key time for developers of vineyards on forested land. Last week, the Sonoma County Board of Supervisors temporarily halted new hillside and ridgetop vineyard projects requiring tree removal. The four-month moratorium is to allow an upgrade of vineyard rules that would, if approved, apply to Preservation Ranch.

The project would permanently set aside 15,000 acres for timber operations, dedicate 2,700 acres for a private wildlife preserve and donate 220 acres for a public park expansion.

But critics, including a coalition of environmental groups, local tribal members and others say those measures are inadequate. They have pressed CalPERS to abandon the plan and have called for protection of the entire 19,652 acres as a timber reserve.

Opponents plan to ramp up their efforts today with a presentation to the Board of Supervisors of 90,000 signatures from those who say they oppose Preservation Ranch and large timber-to-vineyard conversions in general. A Los Angeles woman started the online petition last year using the website Change.org.

CalPERS officials, meanwhile, have quietly reached out to a national group that specializes in forest conservation deals.

Chris Kelly, California program director for The Conservation Fund, said he was called last month by Judy Alexander, the CalPERS portfolio manager, and that he has had several conversations with CalPERS officials in recent weeks.

Kelly said he indicated the group would be interested in talking further about purchasing a conservation easement over the ranch or working with other groups and backers on an outright purchase of the property.

The Conservation Fund owns and manages more than 50,000 acres of forest in Mendocino County for sustainable timber production and sale of carbon credits. One of their properties, a 13,900-acre tract in the Gualala River watershed, borders Preservation Ranch.

“I just told them its something we’ve done in the neighborhood,” Kelly said. “The ball is in CalPERS’ court.”

County officials are set to meet Friday with Redding, the Preservation Ranch consultant, to discuss a revised schedule for the project’s environmental impact report.

Release of the much-anticipated study, which is said to cost up to $2 million, would kick off the public comment and hearing process. The report was originally due at the end of 2011, but was pushed back last year to mid-2012.

David Schiltgen, the Sonoma County planner overseeing the application process, suggested it may be delayed further.

“With this whole changing of agents and consultants, there’s been some delay,” Schiltgen said.





12 Responses to “CalPERS to move ahead with Preservation Ranch”

  1. Fish Tree says:

    I would ask each supervisor to submit a conflict of interest affadavit on who they personally know that is involved in any way to gain financially from the Preservation Ranch Project and publish the said document in PD.

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  2. GAJ says:

    @John, so the past 10 years of actual budget deficits in San Jose, (last year’s was $100 million), didn’t happen?

    Paying people more in retirement than while working is sustainable?

    But this story is about CalPers investing in a speculative and highly controversial land deal.

    Had I made such investments when I was in charge of my company’s 401k I would have been sued to the moon.

    CalPers?

    No problem; the taxpayer will make up the difference and the members of CalPers can sleep easy at night as can the people at CalPers responsible for a complete lack of fiduciary responsibility.

    “With these fiduciary responsibilities, there is also potential liability. Fiduciaries who do not follow the basic standards of conduct may be personally liable to restore any losses to the plan, or to restore any profits made through improper use of the plan’s assets resulting from their actions.

    http://www.dol.gov/ebsa/publications/fiduciaryresponsibility.html

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  3. Lets be Reasonable says:

    @John, I agree that much of the pension issue is being blown out of proportion. Public spending on pensions is not out of historic norms. But the costs ARE rising at an unsustainable rate, especially for safety employees. I would be curious where you fall on Governor Brown’s recent legislation language, particularly the part about current employees going to a 50-50 cost share of any defined benefit pension.

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  4. John says:

    @ GAJ – You like links…

    http://www.nbcbayarea.com/news/local/Guessing-Pensions-138981764.html

    Finally some truth.

    Thumb up 5 Thumb down 0

  5. @Jackson says:

    Any of ya ever wonder why there’s not much development along the Sonoma County Coast? Once you get out of the Russian River aquifer, there’s very little drinking water available. This property will NEVER be developed for housing. Any threat of that is nothing more than scare tactics. Even growing grapes on that land is a long-shot for any profit.

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  6. Jackson says:

    Here’s all the justification needed for the recent moratorium on developing vineyards on watershed land.

    Preservation Ranch is far enough away from the populated centers of the county that most of us will never see the damage done by scraping off the ridgetops for proposed vineyard plantings. But someday, we will have to deal with the damage done by the development.

    There is the potential environmental damage to the watershed; diminishing the salmon spawning tributaries, and creating conditions for flooding along the Gualala River. There is the damage to public roads as heavy equipment and materials are brought in to develop the ridgetops, and increased truck traffic if operations become viable.

    But what if the vineyard profits don’t meet expectations? The real profit is in subdividing the acreage for estate retreats and conservation easements – to prevent even worse development. More development demands public services, especially in the stormy season, and the farther away from resources means the more expensive they are to deliver. We end-up subsidizing the millionaires, again.

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  7. County Worker says:

    The County pension plan has nothing to do with CalPers. My county retirement, if allowed to keep it, is just a piece of my retirement. I also pay into Social Security, that’s a small piece. Anyone who thinks that SS is a retirement plan can not be reasoned with. They have no grasp on reality. It is a safety net to keep you from starving to death. That is all. Anyone can retire anytime they want with planning and hard work. It used to be a goal for many to retire young and enjoy life. Many found a way to achieve it. Now anyone who does that is a thief, a liar and must be scorned. I did the math on my retirement 25 years ago. I am on track unless the laws change. All of you can be on track as well, unless they change the laws on you. Good luck.

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  8. Follower says:

    Nero fiddling while Rome burns.
    What a joke!

    Thumb up 9 Thumb down 4

  9. truth in news says:

    Gee, Calpers is looking to pay pensions with this investment by selling wine to liberals…no wonder you folks are so angry! Maybe ya’ll would be happer if they were planning to grow marijuana.

    Thumb up 7 Thumb down 3

  10. Reality Check says:

    This is what happens when investment “pros” promise a rate of return they can’t deliver, at least deliver safely. They take more risk, in an effort to justify the paychecks they get.

    And, as GAJ says, they aren’t risking their money, they risk yours. And the beneficiaries–public employees–are in the catbird seat, heads they win and if it’s tales the taxpayers lose.

    Not to worry. Sonoma County will float more bonds.

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  11. Money Grubber says:

    GAJ: Right you are! Thanks for your post.

    Aside from the public pensions being handed out 17 years before social security recipients can claim their SS pension, the guaranteed rate of return shouldered by the taxpayer needs to be changed so that the members shoulder their own troubles.

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  12. GAJ says:

    I think we all know why CalPers invests in such dubious and speculative nonsense.

    Because they have NOTHING to lose!

    The taxpayer guarantees the rate of return so if CalPers wants to play “risky investor” it’s on our dime.

    It’s time to stop allowing CalPers so much latitude in their investments when what they’re really doing is risking money of non members!

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