Public access to Dreyfus estate at issue

When the future of Zephyr Cove's Dreyfus estate is resolved, the public should have unrestricted access to a prime piece of beachfront Lake Tahoe property - it just may not be at the Dreyfus estate.

"The public should realize the land the public ends up with may not be land at the estate," said Matt Mathes, spokesman for the Pacific Southwest Region of the Forest Service. "If we do wind up with public beach access elsewhere, it will be equal or better."

The future of the 10,000-square-foot, 16-year-old Dreyfus mansion and surrounding land, including 3,000 feet of sandy beach, have been up in question for more than two years. Closed-door negotiations are under way now between the Forest Service, owner of the 46 acres of land at the estate, and Park Cattle Co., owner of the mansion, caretaker's cottage and driveways on the property.

Mathes said Park Cattle submitted a proposal to the Forest Service in late December, and the federal agency likely will respond within a few weeks.

"The letter made it seem like we're heading in the right direction. We will be responding soon, possibly next week," Mathes said. "We are cautiously optimistic, with emphasis on the word optimistic."

Mathes did not want to elaborate on what was being discussed. He had no estimate of when a resolution might be reached.

"In general, I will say land exchanges are complex and often do take a lot of time, but they always wind up to be well worth that time," he said.

In 1997 the Dreyfus estate was the subject of one of the most expensive land exchanges in Forest Service history. The Forest Service had no interest in the mansion or other improvements on the property, and the agency allowed Olympic Group, the Arizona-based company handling the exchange, to sell them to Park Cattle, which has extensive holdings in Douglas County including the land used by Edgewood Tahoe Golf Course and some of Stateline's casinos. Park Cattle made the purchase with the understanding that a special land-use permit would be issued to operate the buildings as a business.

In 1998, before Park Cattle 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 last 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.

While officials have not confirmed it, some have 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 could 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.

Right now the land surrounding the mansion is open to the public; only the buildings are off-limits.

Both the Forest Service and Park Cattle have been criticized for holding discussions in private; however, Mathes said it's appropriate because the buildings are privately owned.