He also wouldn’t accept Sutterlin’s proposed ban on future development of lakefront/lakeview property in the park for five years. Vardaro said that would potentially tie up other properties. He said it may well be that future Trustees of Conneaut Lake Park will choose not to allow further residential development within that time frame, but he didn’t want to put future trustees in a position where they could have no choice.

Vardaro also said he agreed with Eugene Herne, Pennsylvania’s deputy attorney general, who argued that “the restrictive covenant has substantially changed the sale of the property from what was advertised.” The land wa initially offered to any buyer but without the five-year development ban Sutterlin negotiated, no buyers came forward. Herne argued this made the land more valuable and may have attracted buyers had it been offered to the public with the restriction.

In addition, Vardaro said Stearns hadn’t specifically set forth how proceeds of the sale would be allocated. He said he wanted to see as specifically as possible what portion of the debt would be reduced by the sale.

Furthermore, he said in April 2006, the Economic Progress Alliance of Crawford County received funds to create a development plan for the trustees. At that time, Vardaro ruled the property could be sold, but he would have to be convinced the sale price was adequate and there would be appropriate restrictions on the development of the parcel by any new owner consistent with development plans perceived by Stearns and the EPA “for the good of the public.”

Citing the April 2006 order, Vardaro said before he would approve a sale, he wanted to know that it is logically consistent with some reasonable development plan for the property of the Trustees of Conneaut Lake Park. The judge noted in his ruling that EPA Director Mark Turner wasn’t in court recently to answer some of those questions.

Transition to trustees

Vardaro’s ruling notes that he had attempted to keep the park’s court-ordered overseer in place to allow a transition to a new board of trustees with little or no debt and with the park’s assets preserved as well as they could be. However, he now sees the possibility of a new board of trustees taking over the operation before that point.

He noted that Conneaut Lake Park’s master plan proposed by the EPA, “while not particularly specific, appears to have indications that a plan could be developed to take care of the current debt and, further, there appears to be a desire (by EPA) that there be no increasing debt.”

He said maybe a new group of trustees, possibly in conjunction with the EPA, could develop not only plans for the development of the asset, but also a reasonable plan to take care of the debt that is burdening the business.

In addition to rejecting the sale, Vardaro said it may be appropriate for Stearns to consider turning the matter over to a new group of Trustees of Conneaut Lake Park.

He said that is no reflection on Stearns’ or Deshner’s work, but cited the legal constraints the overseer faces regarding future development of the park as the reason for that recommendation.

Stearns said Monday he has turned the ruling over to the park’s attorney to learn whether the same restrictions apply to a board of directors that apply to him. Vardaro said a board, rather than a non-liquidating custodian, can consider proposals such as Sutterlin’s that may result in the sale of parts of the property to private developers.

In the meantime, Stearns said he will not file petitions for easement purchases for Jeff Davenport, developer of the Snow Waters housing project; and for Carl Burkett, who wanted an easement for access to his property. Both were seeking help to develop properties they own near the park, but do not have easy access because of the location of park properties.