Eminent domain threat alleged in Atascadero: St Luis Obispo (CA) Tribune, 10/31/05

An official reportedly called downtown property owners with the threat of litigation

By Stephen Curran

Atascadero City Manager Wade McKinney could have to answer today for a city official who allegedly threatened downtown property owners with eminent domain litigation if they refused to sell.

Marty Tracey, the city's deputy director of redevelopment, reportedly called landowners Pat and Sue Gaughan on Feb. 22 and left a message telling the couple that the City Council, in its capacity as the Atascadero Community Redevelopment Agency, planned to move forward in a closed session that night with eminent-domain procedures on their property at 6040 El Camino Real.

The plan Tracey is said to have described is illegal under a state law that requires eminent-domain votes be approved by a three-fifths majority of redevelopment agency board members in an open session, City Attorney Patrick Enright said.

It was unclear late last week if McKinney, who as the city's redevelopment director is Tracey's boss, directed Tracey to make the call, Mayor Wendy Scalise said.

McKinney is expected to field questions from council members in a closed-door session at noon today.

Enright and other city officials have denied any such plan is in place. Multiple calls to Tracey's office were not returned.

"The council wants to know what happened here," Scalise said. "It raises the question in my mind as to what direction, if any, was given by the city manager."

McKinney was unavailable for comment, a receptionist in his office said. As city manager, he is employed directly by the council.

The city has no definitive record of what went on at that meeting. Like most councils, the Atascadero panel does not record minutes during closed sessions, Enright said.

Reached Friday, Pat Gaughan said neither he nor his wife attended the closed session. According to an agenda from that day's meeting, the board was to review negotiations between Gaughan and McKinney.

"It almost looks like I was there," Gaughan said of wording on the agenda.

The Atascadero couple, who have owned the property since 1984, described Tracey's tone as "cordial" but his underlying message as threatening.

"His voice wasn't harsh," Gaughan said. "He knows he has me."

The Gaughan's property, a now-vacant gas station and auto shop, sits across from the recently renovated Carlton Hotel in the heart of Atascadero's downtown core. So it is considered ripe for redevelopment.

The couple says they are now fielding offers from developers looking to build projects with a mix of housing and shops on the property.

In a statement sent Thursday afternoon, McKinney said the redevelopment agency had been "actively referring developers to the Gaughan's (sic) to encourage them to develop the corner into a retail and residential use."

A single-page agenda posted Friday afternoon lists the council's business that day as a performance evaluation for a city employee followed by "public employee discipline/dismissal/release."

The board cannot directly fire or discipline Tracey, but can direct McKinney to do so, Councilman George Luna said.

Neither Scalise nor Luna would say whether they thought Tracey should lose his job.

"I think that's a possibility," Luna said. "... This is a very serious issue. We'd been making substantial progress (on downtown redevelopment) and this is a black eye."

St Luis Obispo Tribune: www.sanluisobispo.com