How did Montana de Oro become a state park? Fate was decided in bankruptcy court

Ever since European settlers displaced the Chumash and drew property lines on maps, competing interests have tried to wrest control of San Luis Obispo County’s scenic coast.

The latest debate involves the future of 12,000 acres surrounding California’s last nuclear power plant.

The California Natural Resources Agency recently released its plan for the land around Diablo Canyon Power Plant — a vision for the property near Avila Beach that involves conservation, tribal ownership and increased public access.

That could involve connecting Montaña de Oro State Park near Los Osos to Wild Cherry Canyon, a 2,400-acre property just north of Avila Beach owned by Eureka Energy Corporation. A lawsuit concerning the future of development at Wild Cherry Canyon is currently awaiting a ruling.

Montaña de Oro gets its name, meaning “Mountains of Gold” in Spanish, from the wildflowers that decorate its coastal bluffs each spring.

How did it become a state park?

This beautiful place can trace its origins as a public to a slightly less pretty locale: federal and county courtrooms.

Telegram-Tribune regional editor Charles Judson wrote about the history of Montaña de Oro in a column that ran on the opinion page on Jan. 18, 1965.

Public Ready to Assume ownership of Rancho

RANCHO MONTANA DE ORO — Bill Ahrendt, this region’s most successful rancher-in-bankruptcy, remains faithfully on guard at the gateway to this $2.6 million newest state park but his tenure is limited.

Very soon the sign at the end of the old county road at the foot of Hazard Canyon overlooking Smuggler’s Cove will come down, meaning Bill will be out, and you, as one of the public will be in.

When this magic moment occurs, another chapter in the colorful history of this 4,441-acre remaining portion of an old Central Coast Spanish land grant will be closed and a new one opened.

The chapter now concluding may be titled the “Morris Lavine Plan,” or perhaps, “Bill Ahrendt’s Days as King of the Mountain of Gold.”

The exchange of Rancho Montana de Oro from private to public ownership is apt to occur Tuesday at approximately 9:30 a.m. in the Los Angeles courtroom of Federal District Judge Thurmond Clarke, the federal bankruptcy court where the fate of this property has rested since it landed there in bankruptcy back in 1954.

Lavine could hardly have known anything about this remote coastal holding at that time, but he did soon thereafter.

He was called into the case by New York law firm representing the bankrupt owners Mr. and Mrs. McAllister, in their happier days.

Lavine, knowing more about California real estate that most New York lawyers and many in Los Angeles too where he has practiced for many years, came to San Luis Obispo to meet the McAllisters and look over the property before accepting the case.

He must have liked what he saw, for he agreed to accept the case and represent the owners in bankruptcy for a half interest in what he might be able to work out of the bankruptcy.

The first thing Lavine did was to qualify the property under Chapter 11 of the U.S. Bankruptcy Act which allows the owners to reorganize over a period of years for disposal without loss to the creditors.

To do this, Lavine now operating as one of the owners as well as the lawyer for the bankrupt Rancho Montana de Oro Corp. shelled out of his own considerable pocket to pay off all creditors pressing the claims.

With other creditors, Lavine worked out agreements to pay them their full due and six percent interest under the seven-year reorganization period allowed by the court under Chapter 11.

Then he hired a caretaker, Bill Ahrendt, who had been in the area for a good many years as an employee of the county at the courthouse.

Mrs. McAllister, meanwhile had resumed her former name, Mrs. Irene Starkey, and was holding out at the ranch with a shotgun against process servers and as Ahrendt recalls, Mrs. Starkey didn’t think to well of him.

But Lavine had hired him to keep an eye on the place and to see what he could do in the way of finding a buyer for the place.

“I have worked mighty hard to save and sell this property to all of the people of California,” Ahrendt will tell you.

“I’ve kept the rascals out in so far as I could, and I have encouraged the good people of the Sierra Club and the Audubon Society to come in and look around.

“I introduced the place to Charles DeTurk, state director of Parks and Beaches, and to State Sen. Vernon Sturgeon, both of whom have worked hard to bring this deal about,” Ahrendt says.

Ahrendt finally had to get a court order from Judge Clarke to get rid of Mrs. Starkey with Lavine’s approval, although she remained half-owner.

For his services in keeping the keys, guarding the gate, and interesting the parties with enough cash in hand to make a deal, Ahrendt has an award from the court coming himself Tuesday, $25,000, plus certain additional values, such as the rare collection of antique furniture Mrs Starkey left in the old ranch house when she returned to San Francisco.

A collector priced this furniture last week for Ahrendt and he expects to sell it at a public auction later this week. He believes this separate award will provide and additional $5000 for his services during his seven-year tenure at the ranch.

Mr. and Mrs. McAllister purchased the property in 1942 from O.C. Field, who in turn had acquired it from a number of Japanese families following the unhappy relocation of these families in 1941 upon the start of World War II.

In his sale to the McAllisters, Field retained certain rights, such as the mineral ones, and these were ruled to be worth $96,000 by Judge Clarke another of the matters that delayed negotiations for sale of the property to the state for $2.6 million. But now all of these many wrinkles appear to have been ironed out, prompting Judge Clarke to remark during one of those final settlement sessions between the state and the corporation that this case represents one of the few profitable bankruptcies to come through his court.

One other thing that Ahrendt had hoped for was what Marvin Goldsmith, one of the state’s attorneys, called “Lavine’s Latrine Deal.”

Under this proposition, Lavine and Ahrendt offered to establish public restroom accommodations, in return for a concession from the state to operate a store and a riding academy in the park, but the state wouldn’t go for it.

So Ahrendt and his family, Mrs. Ahrendt, Violet, 21 and about to be married to an airman in Texas, Viola, 19, Billy Jr., 15 and Merrlyn, 7, will soon be taking down the “keep out” sign at the gate and move back into the local center of things at Los Osos.

At this point, John Fleming. Area state area state park superintendent, and his state uniformed park keepers will take over, marking the end of the Lavine-Ahrendt stewardship of Rancho Montana de Oro.

When they do, you, as citizen and taxpayer, can come in, but don’t shove, there is still some picking up and putting down to be done around the old place and there isn’t much money left in the state park kitty for this after the final settlement.