Lake County: A community in crisis

At the dollar store in Lakeport on Monday, Chris and Brandi Noonkester managed to stay within their budget.

They spent $6.

The couple has painstakingly slashed what already had been a meager budget by 20 percent when his hours were reduced at work. How do they feel about that? "We're pretty blessed," Brandi Noonkester said with a smile.

That's right, "blessed." This is Lake County after all, where about one in five people can't find a job. The Noonkesters are happy to have a regular paycheck.

The economy in Lake County, never hearty in the best of times, has gotten so bad that on Monday, the Associated Press reported that it had the 14th worst economy in December among the nation's 3,141 counties with at least 25,000 inhabitants. It ranked worse than the notoriously devastated economies of Riverside County and Wayne County, Mich., home to Detroit.

"Lake County is one of those places that is in big trouble," said David Gallo, a professor of economics at Chico State University. "I don't really see what is going to bring them back."

In the past two years, unemployment has more than doubled, to 18.5 percent. The bankruptcy rate has tripled to 1.4percent. And the foreclosure rate has quadrupled to 3.7percent, according to the Economic Stress Index released Monday by the Associated Press. The index uses those three measurements to analyze U.S. county economies.

Those trends might continue, Gallo said.

"They don't have any advantages," he said. "They don't have great natural resources. They don't have cheap labor. And they don't have access to great transportation."

Plus, the county's tourism sector relies heavily on lower-income visitors, who have dramatically cut their spending, he said.

"You've got a clientele that has just been hammered by this recession," he said.

The 2009 summer tourism season never materialized, according to Lakeport merchants.

"Business is down 40 to 50 percent in the last two years," said Clyde Vincent, owner of Mallard House Motel in Lakeport. "We're limping through this." Vincent is working to renegotiate his business loan with the bank in the hope of lowering his monthly payments.

Lake County's economy is not well-diversified, and during the boom years relied heavily on tourism, wine grapes and the real estate industry, said Debra Sommerfield, who works in the county's Economic Development Department. The recession hit all three of those sectors pretty hard in 2009, and left many of the county's estimated 65,000 residents hurting, she said.

As a result, the unemployment rate climbed rapidly in late 2009. There is no indication that trend will stop soon. Lake County usually lags behind the rest of the country, Sommerfield said.

Unemployment would be higher, except people are likely leaving the county in search of greener pastures, said Gallo, who has worked with the county's Economic Development Department in the past.

"People have either left the area or have just given up looking for work," he said.

Down the street at a cafe near the courthouse, Victoria Philipp is calling it quits. She is closing Caf?Victoria at the end of the week and moving back to Sonoma County.

"People just don't come out," she said. "Last summer's tourism season just never materialized."

In November, the area's largest resort, Konocti Harbor Resort and Spa, closed. It had employed 100 full-time workers, and during the peak season employed an additional 500 part-time workers. That was a substantial hit to an economy that only employs 25,000 people. With the closure of the resort's 5,000-seat amphitheater, local hotels, restaurants and shops no longer enjoy the economic benefit of having big-name musicians visit the area.

Robert Sutton, owner of Sutton Associates Wealth Management in Lakeport, said he was a little surprised that Lake County ranked 14th-worst in the county. But he knows that many of his clients were hurting.

"Some of my very successful winery clients have been hit very hard," he said. "This is the worst economic downturn I've seen."

Despite the grim numbers, Lake County residents can take some solace in knowing that eight other California counties topped the nation list of stressed local economies. Immediately to the east in Colusa County, the unemployment rate is 26 percent. Imperial County along the Mexican border ranked worst in the nation. Lake County fared just better than Clark County, Nev. (Las Vegas), which ranked 13th-worst.

Chris Noonkester, who monitors heart machines at Sutter Lakeside Hospital in Lakeport, said losing hours at work has been pretty rough, but that he and his wife are just glad to have a job to support their two sons, ages 4 and 7.

"The dollar store makes a big difference," he said. "Hopefully things will get better soon."

You can reach Staff Writer Nathan Halverson at 521-5494

or nathan.halverson@pressdemocrat.com.