Thu. Dec 8th, 2022

By Linda Sutter – October 24, 2022

When the same names appear on documents that demonstrate corruptive practices it tells a story about the integrity of our elected officials, why Del Norte County is an unsuccessful entity, and the unlawful use of Federal and State Money.

The Del Norte Economic Development Corporation is a private nonprofit 501(c)3 Corporation that was established in May, 1976 with the initial capitalization provided by a sub-grant in the amount of $1,500,000 from the Tri-Agency Economic Development Authority pursuant to Economic Development Administration (EDA).

In essence, the DNEDC monitored all expenditures and loans for the TRi-Agency. In 2006 The Micro-Brewery located on 400 Front Street in Crescent City was purchased by Ken and Lori Cowan. They had obtained a USDA Loan through the Tri-Agency. In 2008 and 2009 there was a severe nationwide recession which affected all businesses and homeowners throughout Del Norte County.

In 2010 the Cowan’s owed $61,216 to the Tri-Agency Their monthly payment was $844.05, with 10.5% interest. By July 2010, The Tri-Agency sent their bank loan for the business up for alleged bids, and the Tri-Agency purchased this loan for $20,000.00 with a debt of $82,338.81. Since when is the Tri-Agency buying properties with Federal money?

On 11/24/2015 Battery Point Group LLC, purchased the microbrewery along with 4 lots that surround the property for $175,000. According to the records of the Secretary of State the owners are listed as Kevin Hartwick, Troy Duncan, and Matthew Wakefield. Additionally, Troy Duncan allegedly paid off a Small Business Loan connected to Lori as well, amount is not indicated. It is interesting to point out that Battery Point LLC was created December 21, 2013 and purchased 400 Front street from Tri-Agency in 2015. Tri-Agency held onto the property and there is no documentation of them making payments to the USDA.

None of the Bank records reflect this transaction nor demonstrate where the proceeds went to. However, in the Tri-Agency’s Treasurer’s Annual Investment Policy Proposal, “the Tri-Agency could place the proceeds in a money market brokered by Edward Jones. In essence instead of paying off the $82,338.81 owed to Tri-Agency, the board members distributed it by their own governing laws to Edward Jones”. Who is the proprietor of Edward jones? Mike Sullivan.

In the meantime, during the January 27, 2010 Tri-Agency EDA meeting during closed session, Counsel Don Henion reported that the following action was taken on a motion by Ron Phillips, seconded by Charles Slert, and unanimously carried, The Tri-Agency EDA commission directed staff to begin the private foreclosure on Tri-Agencies notes and deed trust on the Cowans loans. “THE BUSINESS PROPERTY AND EQUIPMENT ARE WHAT WILL BE FORECLOSED ON; NOT PERSONAL PROPERTY OR RESIDENCE DUE TO DEBT SERVICE.

While all of this was going on Mr. Renfroe, who was the executive Director of the Tri-Agency sent a memo on June 13, 2012. “IMMINENT BUDGET DEFICIT.”

“The Tri-Agency has no reserves. The reason for the deficit is 2-fold

1. Additional audit fees, and

2. CDBG microloans processing fees were overestimated by $4,000. Meaning a total of $15,000 was estimated but only $11,000 was invoiced. He goes on to say, “We will have a negative balance of $4,500 and the Tri-Agency will be unable to pay consultants for the month of June and close the doors on July 1, 2012.” And, that is what happened. Mr. Renfroe goes on to sue the Tri-Agency for severance pay. Later, Mr. Renfroe would be accused of taking documents that belonged to the Tri-Agency. That did not happen.

I made contact with Mr. Renfroe regarding the alleged boxes of documents he was to have taken. Mr. Renfroe informed me those banker boxes were left with Jeannine Galatioto (former Chief Administrative Officer prior to Jay Sarina). Those documents were indeed left at the county office and available for public inspection.

Keep in mind, all this was operated and managed by the Del Norte Economic Development Corporation. The DNEDC continued to perform bad and corruptive practices through Realtors who were assigned on the DNEDC board and were parties to selling property and making decisions on whether or not a borrower received a loan. This affected the Tri-Agency who had no one monitoring their ongoing organization and who used the DNEDC administration to provide Tri-Agency loans to public members for businesses.

In 2020, Chris Howard begin to strong arm The Cowans for Tri-Agency Economic Development Authority loans that had not been paid back. In fact one of those loans was regarding the Micro-Brewery on 400 Front Street. Mr. Howard obviously did not conduct his due diligence on this particular loan because if he had, he would have discovered the meeting minutes of January 27, 2010. ““THE BUSINESS PROPERTY AND EQUIPMENT ARE WHAT WILL BE FORECLOSED ON; NOT PERSONAL PROPERTY OR RESIDENCE DUE TO DEBT SERVICE.”

In 2020 The Tri-Agency received $115,000 from the Cowan’s after Supervisor Chris Howard forced sale of their home. Mr. Howard was obviously unaware at the time as were his cohorts, that the Tri-Agency sold the Micro-brewery for $20,000 with a $82,000 dollar debt, in July 2010. And, the Tri-Agency sold this property to who?? The Tri-Agency. The Tri-Agency then sold the property to Kevin Hartwick and Troy Duncan for $175,000 in November 2015. Matthew Wakefield is listed as a CPA.

In 2017, Mr. Howard leads Lori Cowan on a fishing expedition in Washington to plea her case to forgive the USDA loan. Washington said no. However, Washington was unaware that the proceeds from selling the Micro-Brewery were more than enough to pay back the loan, but those proceeds disappeared or allegedly went to Edward Jones, in any case none of the Tri-Agency bank statements reflect receiving proceeds from the sale of the Micro Brewery a second time On November 24, 2015 according to county records.

The questions that have been asked and never answered were, where is the promissory note for $400,000 taken out by the Tri-Agency after 1997 and who benefited from it. The USDA does not have a list of recipients. The documentation does not exist due to laziness and incompetency. The Federal Government is investigating the DNEDC however, they should be investigating the Tri-Agency for non- compliance, money laundering of federal funds, and the disappearance of those funds as well as forcing the Cowan’s to pay for something they did not owe.

4 thoughts on “FATAL FLAWS: DEL NORTE ECONOMIC DEVELOPMENT CORPORATION; CORRUPTION”
  1. Linda, this is excellent reporting and reaffirms the select group getting all the goodies.
    I know this can be frustrating but your reporting is educating people.

  2. The Tri-Agency which consists of the Crescent City Harbor District, Crescent City, and Del Norte County held a joint powers meeting at the VFW Hall on October 25, at 5:30 pm. Approximately 10 public members showed up, Kevin Hartwick was one of them.
    It was after the meeting what I found interesting. Mr. Hemmingsen stated to me, “you had a lot of good information but you threw Kevin Hartwick under the bus.”
    I replied, “How is that?”
    Mr. Hemmingsen stated, “Kevin paid off a small business administration loan for that property and has sunk about 1 million dollars into it ” I informed Mr. Hemmingsen that was not reflected on the County records by assessors office, and then showed him a copy of it.
    In essence Mr. Hemmingsen said the $175,000 dollars paid off SBA and the property as well as the lots were GIVEN to Mr. Hartwick? None of the $175,000 dollars went towards the Cowan’s USDA DEBT. And that ladies and gentlemen is corruption. Do you think USDA knows about that?

    1. How many of the attendees at the VFW Hall were Military Veterans; much less Veterans of Foreign Wars? Our Veterans and their local organizations should not support the financial money-grubbing of our local political crooks.

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.