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AB 506 Mediation
AB 506 MEDIATION

MOUMOU Town of Mammoth Lakes – Debt Restructuring Solutions Reached During the AB 506 Mediation Process

Updated on June 28, 2012

Press Release

Materials for Special Meeting on Monday, July 2nd at 10.00 a.m. in Suite Z

On April 30, 2012 the Town initiated a mediation (“neutral evaluation”) process pursuant to the new California State law, AB 506. A total of 16 “interested parties”, or creditors, have participated in a 60-day mediation process, with the guidance of the Honorable Judge David Coar. Regrettably, as of today, the Town’s largest creditor, Mammoth Lakes Land Acquisition (MLLA), has refused to join the mediation, despite the Town’s multiple invitations.

The State law generally requires that the mediation be confidential. However, the Town and the mediating parties have signed confidentiality waivers consenting to making public the names of the mediating parties, requests made by the Town to these parties, and any agreements reached in mediation.  

The Town has created this website to post information concerning the mediation. The 60-day mediation is scheduled to conclude on Friday, June 29, 2012, unless extended as provided by AB 506. To date, the Town has been able to reach agreements with most parties, and these agreements are detailed below.

Regardless of the outcome of the mediation and the status of agreements, the Town plans to implement its FY 2012-13 budget, approved by the Town Council on June 20, 2012, on July 1, 2012.  The detailed budget document, including the Budget Reduction Plan, is available on the Town’s website, under http://www.ci.mammoth-lakes.ca.us/index.aspx?NID=192.

1. Concessions Sought and Agreements Reached

    The Town has sought agreements with its creditors in an attempt to restructure its current debts and obligations outside of bankruptcy, or pursuant to a Chapter 9 plan if a bankruptcy is commenced. The table below summarizes the concessions sought, and the status of reaching agreements.

     

    CREDITOR / "INTERESTED PARTY"

    IMPAIRMENT PROPOSED: More detail

    STATUS OF REACHING AN AGREEMENT

    PARTICIPATING IN MEDIATION

     

     

     

     

     

     

    CalPERS

    NO IMPAIRMENT sought, and no current plan to seek  impairment.

    N/A

     

     

     

     

     

     

     

    All civilian employees

     

     

    General Employees Association (GEA)

    8% retirement pick-up, discontinue 2% deferred comp, limit annual cash out of leave to 80 hours, change how overtime is calculated. Recommend that members vote in favor of 10% cut in pre-July 2012 leave balances.

    MOU SIGNED

     

     

    Management Employee Association (MEA)

    8% retirement pick-up, discontinue 2% deferred comp, limit annual cash out of leave to 80 hours.  Recommend that members vote in favor of 10% cut in pre-July 2012 leave balances.

    MOU SIGNED

     

     

     

    Public Works Employee Association (PWEA)

    8% retirement pick-up, discontinue 2% deferred comp, limit annual cash out of leave to 80 hours. Recommend that members vote in favor of 10% cut in pre-July 2012 leave balances.

    MOU SIGNED

     

     

     

    Unrepresented civilian employees

    8% retirement pick-up, discontinue 2% deferred comp, limit annual cash out of leave to 80 hours. Support plan that provides for 10% cut in pre-July 2012 leave balances.

    Agreements SIGNED

     

     

     

     

     

     

     

     

    All sworn police employees

     

     

    Mammoth Lakes Police Officers Association (MLPOA)

    9% retirement pick-up, discontinue 2% deferred comp, discontinue PARS (5% savings), cut one position (7%), limit annual cash out of leave to 80 hours. Recommend that members vote in favor of 10% cut in pre-July 2012 leave balances.

    MOU SIGNED

     

     

    Unrepresented sworn employees

    9% retirement pick-up, discontinue 2% deferred comp, discontinue PARS (5% savings), limit annual cash out of leave to 80 hours. Support plan that provides for 10% cut in pre-July 2012 leave balances.

    Agreements SIGNED

     

     

     

     

     

     

     

    Mammoth Unified School District

    Ice Rink: reduce lease payments by 10%

    		 MOU Signed

     

     

     

     

     

     

     

    Mammoth Lakes Chamber of Commerce

    Reduce contract amount by 10%

     MOU Signed

     

     

     

     

     

     

     

    BRAVO GARDENS: Represented by Mammoth Sierra Properties

    Reduce contract for Maintenance of Promenade (Main Street) and other Town properties by 10%

     MOU Signed

     

     

     

     

     

     

     

    Mono County

    Cancel the contract for the Whitmore Animal Control Shelter

    MOU Signed

     

     

     

     

     

     

     

    Mono County Sheriff

    Reduce by 10% contract for Public Safety Dispatch

     MOU Signed

     

     

     

     

     

     

     

    Steve Searles

    Reduce by 10% contract for Wildlife Officer services

      MOU Signed

     

     

     

     

     

     

     

    High Sierra Energy Foundation (HSEF)

    CONTRACT CANCELLATION

    N/A

     

     

     

     

     

     

     

    Mammoth Lakes Tourism (MLT)

    Reduce annual funding (TOT and BLT) by 10%

      MOU Signed

     

     

    Less return of the 5% TOT enhancement to MLT (see below)

    Less return of the 5% TOT enhancement to MLT (see below)

     

     

    Net MLT reduction

    Net MLT reduction

     

     

     

     

     

     

     

    Mammoth Lakes Housing (MLH)

    Reduce contract amount by 10%

      MOU Signed

     

     

    Less return of the 5% TOT enhancement to MLH (see below)

    Less return of the 5% TOT enhancement to MLH (see below)

     

     

    Net MLH reduction

    Net MLH reduction

     

     

     

     

     

     

     

    Eastern Sierra Transportation Authority (ESTA)

    Reduce funding amount by 10%; and reduce contract vehicle service hours by up to 10%.

    MOU SIGNED

     

     

    Less return of the 5% TOT enhancement to ESTA (see below)

    Less return of the 5% TOT enhancement to ESTA (see below)

     

     

    Net ESTA reduction

    Net ESTA reduction - funding cut by 5%, vehicle service hours reduced by up to 5%.

     

     

     

     

     

     

     

     

    Hot Creek Hot Creek Aviation AND Hot Creek Aviation Management, LLC - Fixed-Based Operator (FBO) for the Mammoth-Yosemite Airport. Represented by Pat Foster.

    At the FBO’s request, restructure a contract that is no longer financially feasible, resulting in a $135,000 annual revenue loss to the Town.

    New Agreement SIGNED

    Part 1

    Part 2

    Part 3

     

     

    Hot Creek Development Agreement - Terry Ballas, Developer. Represented by Pat Foster.

    Discussions under way.

     

     

     

    Hot Creek Companies. Represented by Pat Foster.

     

     

     

    Hot Creek FBO Facilities Group. Represented by Pat Foster.

     

     

     

    Hot Creek Hangar Group, LLC. Represented by Pat Foster.

     

     

     

     

     

     

     

     

    Union Bank

    Debt term extension and interest reduction

     

     

     

     

     

     

     

     

    Mono County Historical Society

    Reduce annual audit contract amount by 10%

      MOU Signed

     

     

     

     

     

     

     

    NOT PARTICIPATING IN MEDIATION

     

    Minaret Village Center

    Town Administrative Offices: reduce lease payments by 10%

     

     

     

     

     

     

     

     

    Bradmont LLC 

    Police Building: reduce lease payments by 10%

     

     

     

     

     

     

     

     

    Marcello & Co

    Reduce annual audit contract amount by 10%

    New contract delivered to the Town.

     

     

     

     

     

     

     

    Citizens Business Bank

    Debt term extension.

     

     

     

     

     

     

     

     

    California Joint powers Insurance Authority

    10-year payment on past liabilities, amounting to $1.4 million.

     

     

     

     

     

     

     

     

    Mammoth Lakes Land Acquisition

    Reduced payment on the $43 million judgment (amount including interest and fees)

    .

     

     

     

     

     

     

     







     2.  Proposed Plan of Debt Adjustmen

    The Town of Mammoth Lakes’ Proposed Plan of Debt Adjustment, filed with the Bankruptcy Court on July 3, 2012, is available here: Proposed Plan of Debt Adjustment.



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    Location: 437 Old Mammoth Rd, Suite R, Mammoth Lakes, CA 93546   •   Mailing Address: PO Box 1609, Mammoth Lakes, CA 93546   •   Phone: 760-934-8989   •   Fax: 760-934-8608