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A Petaluma nonprofit group has rejected a $10,000 donation an anti-big box organization negotiated for it from a shopping center developer, saying it wants to avoid potential backlash from the deal.

Heritage Homes of Petaluma board members voted 7-1 to turn down the donation from the Petaluma Neighborhood Association because it "wasn't in alignment" with the group's mission of protecting historic structures.

The PNA reached a settlement last month with Merlone Geier Partners, developers of the Friedman's-based Deer Creek Village shopping center, in which the PNA would drop its legal challenges to the project in exchange for $191,000 in concessions.

PNA leader and west Petaluma resident Paul Francis successfully negotiated contributions from Merlone Geier for three interests: $30,000 to a city tree planting fund, $25,000 to the Petaluma River Heritage Center and $10,000 to Heritage Homes.

The agreement also obligates Merlone Geier to pay $36,000 to the PNA's lawfirm and fund $110,000 in improvements to the Lynch Creek bike and pedestrian trail, traffic calming measures on Rushmore Avenue and crosswalks and pedestrian signals at Rainier Avenue and Maria Drive near the project.

Heritage Homes president Alicia Wallace said her board decided the money — as useful as $10,000 could be — didn't fit in with the group's objectives.

"We're trying to do something positive," she said. "Not that this settlement is not going to do positive things, but just in general, there's going to be a lot of people upset about it. I'm happy the money is going to the community ... but we as a group don't feel it's in alignment with our mission."

She acknowledged that some board members were leery of accepting the money because of negative community reaction to the PNA's 2010 settlement of its lawsuit opposing the Target shopping center on East Washington Street.

In that, the PNA agreed to drop its suit in exchange for $50,000 in legal fees and a $100,000 no-strings-attached payment to Francis and Matt Maguire, the other PNA leader in that fight. The pair were the target of ire from some members of the community who called their tactics extortion.

"If it got as ugly as the Target settlement, people needed to know how we felt about" accepting the money, Wallace said. "We didn't want it to be seen as negative or that Heritage Homes was tied to it in any way."

The lone Heritage Homes board member who voted to accept the money was Francis' wife, Kelly Collins.

Collins and Francis' home was on the most recent Heritage Homes tour last month. Wallace said the relationship "had nothing to do with" the board's decision regarding the donation.

Heritage Homes members said they weren't asked to be part of the settlement and in fact didn't even know they would be a recipient of Merlone Geier's money until they read about the settlement in news reports.

"Quite frankly, I found that kind of odd," said board member Ron Bausman.

Being a willing recipient of the PNA's settlement money could be misinterpreted as support of the group, he said.

"There was no reason for that inference," he said. "We are certainly not politically in any way aligned or disaligned with PNA. It kind of read that way...The money is probably better served going somewhere more appropriate."

JT Wick, chair of the nonprofit Friends of the Petaluma River, which fund raises for and manages the River Heritage Center for the city of Petaluma, said he also found out through the media that his group was set to receive $25,000 from the settlement.

"The news came as a complete surprise to us," he said. "We didn't even know we were under consideration for anything."

His board is meeting Thursday to discuss whether to accept the money. He said he hasn't received any feedback from members about their feelings.

In an email, Francis said choosing Heritage Homes and the River Heritage Center was an effort to "try and create links between the downtown retailers, tourist attractions, river and the (Deer Creek Village) project itself — the premise being to enhance east and west side connections."

He said Heritage Homes' decision "may have been guided by misconceptions about the issues." He said the PNA looks "at the bigger planning picture in terms of linking neighborhoods and redevelopment districts to one another."

Longtime Heritage Homes member Alice Forsyth said the PNA's history of accepting financial settlements in exchange for dropping legal opposition are a bad example.

"It's an association that personally I don't want to have," she said. "It's just better to steer clear of any entanglements that might reflect badly. The precedent has been set, unfortunately, but it's not a good path to follow. I agree with Heritage Homes to not want to encourage that."

What happens to the $10,000 the group declined is unclear. The legal agreement didn't address the possibility.

A Merlone Geier spokesman said representatives will be in contact with Francis to discuss options.

You can reach Staff Writer Lori A. Carter at 762-7297 or lori.carter@pressdemocrat.com

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