Dreyfus decision may happen in new year

A decision on what will happen to Zephyr Cove's Dreyfus estate may be on the horizon in 2000.

Then again, maybe not.

The future of the 10,000-square-foot Dreyfus mansion and surrounding land, including 3,000 feet of sandy beach, has been up in the air for more than two years. Seemingly conflicting reports received this week indicate ... well, perhaps not much has changed.

Matt Mathes, spokesman for the U.S. Forest Service, Tuesday said the federal agency expects a new proposal today or Friday from the Park Cattle Co. about the future of the estate and "is excited the process is moving forward." How long it might take to reach a resolution from that proposal, he couldn't estimate.

Conversely, officials from Park Cattle, which owns the 15-year-old mansion but has no permit to use it for commercial purposes, and Douglas County, which has long been involved in the issue, did not use such positive words when describing what is happening.

Park Cattle and the Forest Service months ago agreed not to talk about their negotiations publicly, and, for that reason, Park Cattle consultant Gary Midkiff said Tuesday he couldn't reveal the details of what's being talked about.

"Hopefully, there's going to be a solution, but at this point it's hard to say what that might be," Midkiff said. "That's about all I can say. There are some back-and-forth discussions going on, but they are limited."

Don Miner, a Douglas County commissioner who has long been a vocal critic of the process surrounding the Dreyfus estate land swap, was even more skeptical. He said he didn't believe even that much was happening, describing the private-discussion agreement as a "farce."

"There's been basically no activity, nothing going on," Miner said Tuesday. "Ever since the Forest Service said there's a gag order in, they have not returned phone calls. Never have they initiated further discussions since the gag order was put in place."

Gordon DePaoli, attorney for Park Cattle Co., did not return phone calls Tuesday or Wednesday.

In 1997 the Dreyfus mansion and 46 acres surrounding it were the subject of one of the most expensive land exchanges in Forest Service history. The Forest Service reportedly had no interest in the mansion or other improvements on the property, and the agency allowed the Arizona-based company handling the exchange to sell them to Park Cattle.

Park Cattle, which has extensive holdings in Douglas County including the land used by Edgewood Tahoe Golf Course and some of Stateline's casinos, made the purchase with the understanding that a special land-use permit would be issued to operate the buildings as a business.

Last year, before Park could get a permit, the U.S. Department of Agriculture Office of the Inspector General began a criminal investigation into how the transaction was made. That investigation concluded earlier this year, saying there was no criminal wrongdoing. At that time, however, Park Cattle and the Forest Service began private negotiations about what would happen to the mansion and caretaker's cottage.

The Forest Service has not publicly commented on the situation since then. It has been speculated that Park Cattle's original request to have exclusive use of not only the estate but also 80 acres of surrounding land troubled the federal agency. Forest Service officials may have been concerned the federal government had spent the equivalent to $38 million on a parcel of land of which Park Cattle would have almost full control.

For the mansion and caretaker's cottage, valued at about $3 million, Park Cattle paid $300,000 cash, two Edgewood Country Club memberships and seven weeks exclusive use of the mansion each year for 20 years.

The Forest Service's Mathes said Tuesday that federal officials didn't know what to expect from the latest proposal.

"We are expecting a proposal later this week from Park Cattle Co., probably (today). Their first proposal was kind of conceptual. The proposal we'll get this week is supposed to be more specific," he said. "I would rather wait until we see it (before speculating on when there may be a resolution). This is the first time we will have had something specific to look at."

The Forest Service has long said its primary goal in negotiations is to provide public access to the beach area. Right now the land surrounding the mansion is open to the public; only the buildings are off-limits.

Douglas County leaders, who had been interested in purchasing the mansion, were originally happy with the exchange because they thought Park Cattle's ownership would increase public access to the mansion and it would mean more tax dollars for the county. The county's happiness quickly turned to bitterness as the exchange became bogged down in the secret investigation and private negotiations.

Commissioner Miner said the county now wants to expand Zephyr Cove park to more than 70 acres of Forest Service land around the mansions. He said a letter was sent to the Forest Service a month ago to propose the idea. The county hasn't heard from the Forest Service.

"This go around we are not backing off," Miner said. "We're going to work the system to get a special use permit to ensure more recreational opportunities in Douglas County at the lake."