Healdsburg Councilwoman Appeared to Direct Litigation Against Neighboring Private Club

Councilwoman Ariel Kelley adamantly opposed 891 Grove Street's inn, private recreational park & swim club while virtually residing next-door

Per a Press Democrat article published on October 22, 2022:

In July of 2020, the Fowler family sold the Honor Mansion, a bed-and-breakfast at 891 Grove St. in Healdsburg, to a group including longtime Silicon Valley executive Craig Ramsey, and Patrick and Jonathan Wilhelm, whose family built the Mayacama Golf Club.

The mansion, about a mile north of the Healdsburg Plaza, was “definitely tired” and in need of some renovation, said Maya Elmer, who lives across the street. She was pleased by the prospect of improvements, and comforted by the assurances of the new owners that the property would merely be an improved version of the old inn.

In an April 2021 letter, Patrick Wilhelm assured Healdsburg assistant planner Jeff Fisher that the property would operate “as an 11 bedroom bed-and-breakfast with various amenities” — an 18-hole putting green and 6 pickle ball courts, for example — “to attract Wine Country clientele.”

So, Elmer and others were taken aback when they received notices last spring from California’s department of Alcoholic Beverage Control, alerting them that the new owners of 891 Grove had applied for a license to serve beer, wine and distilled spirits.

On Sept. 1, the owners applied to the city of Healdsburg for a conditional use permit. Along with operating a bed-and- breakfast, they would also open a “private recreational club,” featuring, in addition to those recreational “amenities,” a 2,392-square foot outdoor pavilion with a full kitchen, bar area and lounge, which could serve beer, wine and spirits on-site.

The new establishment is called The Ruse — an apt moniker, said Elmer and others who feel deceived by the developers.

The developer “obviously put the cart before the horse in terms of liquor licensing and building a restaurant in a neighborhood with no use permit,” wrote Peter Eastlake in an email to the city opposing The Ruse’s conditional use permit application.

The Wilhelms, he went on, “built a temple to wine and spirits for their private club guests before doing diligence on whether that model would even be acceptable for a residential neighborhood. It’s not at all appropriate.”

Patrick Wilhelm pointed to the great lengths to which his company has gone to make the mansion safer and more modern — to restore it to its historic stature.

“We want to do really great things for the community,” he said. “We’re working with the Healdsburg Jazz Festival to provide rooms for their visiting artists.”

He disputes the notion that The Ruse is out of place in a residential area. The 3-acre property straddles two different Healdsburg zoning districts. One is “Grove Mixed Use,” the other is residential. “We met with the city,” he said. “They said, ‘Yes, you can do a private recreational park and swim club.’”

Based on that assurance, he said, “we spent a lot of money.”

The company bought the property for some $5 million and has spent an additional $14 million on renovations.

While the city does indeed allow “private parks and recreational swim clubs” in residential areas, Healdsburg Community Development Director Scott Duiven informed Wilhelm in a Sept. 16 email that The Ruse “is more accurately characterized” as a “private club, fraternal lodge and meeting hall,” which is not permitted in a residential area.

For that and other reasons, Duiven rejected the company’s application for a conditional use permit.

In an appeal filed 10 days later, the developer’s attorney, Erin Carlstrom, zeroed in on the fact that “Private recreational parks and swim clubs” are not clearly defined in the Healdsburg Land Use Code, and that city staff “failed to provide a clear definition.”

That is certainly a point to which she will return at the Oct. 25 meeting of the Healdsburg Planning Commission for a public hearing on that appeal.

The outcome is sure to be appealed to Healdsburg City Council. Vice Mayor Ariel Kelley, who also lives in the neighborhood, will abstain from that vote, she told The Press Democrat. She declined further comment.

Elmer, her neighbor, described the developers’ attitude as: “We’re just gonna fly below the radar, we’re going to use our power and money and connections to get what we want.”

Despite objections from “about six” residents who live near 891 Grove, said Patrick Wilhelm, “a lot of the neighbors are very excited about the project, and hundreds of other people, locals in Healdsburg, are very excited. We’ve gotten a hell of a lot of letters of support.”

He added that a lot of those supporters “will be showing up for the hearing on Tuesday.”

One supporter is Hardeep Gill. “I grew up here,” said Gill, who owns a gas station in Healdsburg. “I’ve seen all the development throughout the years. These smaller hotels have always been such a net positive for the town.”

They bring jobs “but not the traffic,” he said of a “Montage or Mill District-level build-out.”

Rick Oberdorfer, who lives across the street from The Ruse, spent four decades in construction, working as a project manager and superintendent.

“We welcomed the fact that the property was going to get an upgrade,” he said. “I figured nothing major was going to change.” When a developer proposes a different use for a property, he said, “the city puts out a notice to neighbors about hearings. We hadn’t heard any of that.”

One day, looking across the street, he noticed “all these steel columns,” Oberdorfer recalled. “A pavilion was going in.”

That structure took Oberdorfer by surprise, he said. “It was beyond what I thought the scope of the work was going to be.”

He reached out to Jerry Eddinger, the general contractor in charge of the project. “He gave me a little tour, but never mentioned anything about a private club,” Oberdorfer recalled.

Eddinger is a former Healdsburg mayor who has been on the city’s Planning Commission since 1996. He resigned from that panel last week. Eddinger did not respond to emailed requests for comment.

Patrick Wilhelm “wasn’t lying to me,” Oberdorfer concluded. “But he wasn’t necessarily telling me everything.”

Editor’s note: This story has been updated to specify that The Ruse property straddles two different zoning districts.

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891 Grove Street LLC is currently suing the City of Healdsburg, California for Unlimited Writ of Mandate.

The following tentative ruling was posted yesterday by the Sonoma County Superior Court.

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Initially, 891 Grove Street LLC filed a lawsuit against the City of Healdsburg on October 27, 2023.

Court records indicated a monetary award was given to 891 Grove Street LLC, awarded against the City of Healdsburg per a judgement issued on 1/21/2025.

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On December 18, 2023, Paul Hastings LLP issued a letter to Healdsburg City Attorney Samantha Zutler on behalf of 891 Grove Street LLC:

Excerpts from the letter included:

We write in response to the Notice of Violation (“NOV”) issued on October 4, 2023, by the City of Healdsburg (“City”) to Grove regarding alleged violations of the Healdsburg Municipal Code (“Code”). As explained below, the alleged violations set forth in the NOV are meritless. The Club is an authorized use “by right” under the Code because it constitutes a “private recreational park and swim club,” or a “Private Recreational Club” for short. Further, the Club operates in a manner that follows guidance from the City’s own zoning official, Mr. Duiven, which further undermines the allegations in the NOV. We invite you to the tour the Site.

The NOV appears to be the City’s latest attempt to frustrate Grove’s lawful business practices. This improper conduct must stop. From all that appears, Mayor Ariel Kelley, who lives literally next door to the Site, has prompted the City’s surprising hostility to the Facility. While Ms. Kelley is free to oppose any project she wants in her personal capacity, it is highly improper for her to use the powers of her official office, directly or indirectly, to interfere with our client’s lawful activities. In this connection, we note that a Public Record Acts request was sent to the City and a lawsuit is pending for the release of public records, including correspondence involving Mayor Kelley.

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The City of Healdsburg’s Special Council Meeting minutes from Feb. 5, 2024 included the following closed session item: Conference with Legal Counsel – Existing Litigation (§54956.9)(d)(1) 891 Grove Street, LLC v. City of Healdsburg, Case No. 23CV01315, Sonoma County Superior Court.

Despite personally residing next-door to 891 Grove Street, the Council minutes indicated that Councilwoman Ariel Kelley did not recuse herself from participating in closed session to direct staff regarding existing litigation.

Because the Feb. 4 meeting took place in closed session, no video recording was published for the public. So, why did the City allow Councilwoman Kelley to participate in the conversation? If she recused herself, why did Staff fail to document minutes accurately?

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Is staff colluding with Councilwoman Ariel Kelley to conduct her bidding because her putridly wealthy family runs the City?