By Tom Knudson, The Sacramento Bee, Calif.
Jul. 3--OLYMPIC VALLEY, Calif.--Over the past decade, Alexander Cushing's bold expansion of Squaw Valley Ski Corp.
has brought him into conflict with county regulators, state agencies and, through a much-publicized lawsuit, the
Sierra Club and Silicon Valley billionaire William Hewlett.
Now he faces a new adversary: the U.S. government.
On June 20, U.S. Environmental Protection Agency investigators armed with pistols and a federal search warrant
seized a mountain of documents and computer files at Squaw Valley's headquarters. Their mission: to determine if
Squaw Valley committed federal environmental crimes in the building of new ski lifts. If proved, the offenses could
carry penalties of as much as $50,000 per day and three years in prison.
Cushing, who founded Squaw Valley in 1948 and remains its chief executive officer today, responded to the allegations
the way he has responded to previous legal and regulatory difficulties: with outrage, pride and denials of wrongdoing.
"I'm not worried because we have nothing to hide," said Cushing, 86. "We are environmentally sensitive
people. The environment is the most important thing we do. That's how we make our money, on beauty and the environment.
People don't come up here to ski on a freeway."
Cushing and his wife, Nancy Wendt, president of Squaw Valley Ski Corp., said they were caught off-guard by the
search. In an interview, they speculated that the motivation for the action was not environmental justice. They
said they suspect disgruntled county or state bureaucrats sparked the investigation and that the government itself
leaked the story to the media.
What's more, Squaw Valley's attorney, Paul Minasian, said the search was seriously flawed because investigators
seized correspondence between Minasian and Squaw Valley, documents he said are protected by attorney-client privilege.
The EPA denied the speculation about its motivation and leaks to the press. Placer County and Lahontan Water Quality
Control Board officials said they don't know how the probe began. The U.S. Attorney's Office in Sacramento declined
to comment on the attorney-client matter.
Michael Remy, a Sacramento attorney who represented the Sierra Club in a lawsuit against Squaw Valley in the 1990s,
said such discord is not unusual.
"This is his (Cushing's) modus operandi," Remy said. "Everything has been a tumultuous relationship
between enforcers and regulators and Ski Corp. since Day One."
The EPA, in a search warrant affidavit, alleged Squaw Valley violated the U.S. Clean Water Act by polluting the
south fork of Squaw Creek, a tributary to the Truckee River, with sediment during construction of its Funitel gondola
and by making false statements in environmental documents. It also alleged the ski area violated the Clean Water
Act by illegally discharging sediment into the south fork of Squaw Creek while building its Headwall-Cornice II
express ski lift.
The EPA's action follows extensive conflict between Squaw Valley and the Placer County Planning Department and
Planning Commission and the Lahontan Water Quality Control Board over excessive excavation and other problems involved
in the construction of the two lifts. The federal search means only that an investigation, not a legal proceeding,
has begun.
"Obviously, we've had some problems on those two projects (the Funitel and Headwall-Cornice II), and we did
work our way through it," Wendt said. "We were working on some (environmental) mitigation, a plan that
was accepted" by Placer County and Lahontan.
"But evidently, somebody in one of those agencies wasn't satisfied and that's when they brought in these federal
people who have never stepped foot on our property before, never called us or asked us to do anything. It's really
strange," Wendt said.
EPA officials declined to discuss the matter. Squaw Valley's lawyer Minasian wishes they would. "I pray that
somebody will pick up the phone and tell us what the motivation for this was," he said.
Fred Yeager, director of the Placer County Planning Department, said: "I don't know anything about it. (The
EPA) hasn't discussed the action with us, either before or after."
But the EPA was in contact with the Lahontan water board -- a subdivision of the California Environmental Protection
Agency -- before the search, said Harold Singer, the board's executive director. Singer declined to elaborate.
Also, Martin Goldberg, an environmental specialist with the Lahontan board, was present and assisted EPA investigators
in the search.
"In essence, they (the EPA) requested me," Goldberg said. "They asked that I assist with the search
because of my expertise in the area."
But Goldberg added: "To tell you the truth, I don't know how it came about. I don't know who called who first.
I think that they (the EPA) were very interested because they've seen continual violations" at Squaw Valley.
Squaw Valley's environmental track record also came up for discussion at a recent meeting of the Sierra Nevada
Environmental Crimes Task Force, The Bee has learned. The task force, a consortium of county, state and federal
agencies, including the EPA, is coordinated by the U.S. Attorney's Office in Sacramento and meets secretly once
every two months in Auburn or Placerville.
Julie Wukovits, a special agent with EPA's criminal investigation division who attends task force meetings, declined
to comment. "Task force meetings are confidential," she said.
Cushing also criticized the government for asking him, in a document, not to disclose the existence of a separate
federal subpoena served on Squaw Valley to produce documents. "That struck me as funny," Cushing said.
"Meantime, they leaked the whole story to the press."
Wukovits, though, said there was no leak. "We did not go out of our way to call anyone," she said. "It
(the search warrant affidavit) is on file in the courthouse." That is how the press got the story, she said.
Another source of controversy is the correspondence between Minasian and Squaw Valley seized during the search.
Under California law, documents transmitted between a client and attorney cannot be disclosed to outside parties.
"I have serious concerns about it," Minasian said. "Sometimes cases are dismissed because there's
been a violation of the attorney-client privilege."
Patty Pontello, a spokeswoman for the U.S. Attorney in Sacramento, declined to comment. "It's an ongoing investigation,
and we're not allowed to discuss investigations," she said.
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