GEARHART — Martha Strickland, a co-owner of Neacoxie Barn in Gearhart, is facing foreclosure at the former livery stable on the banks of Neacoxie Creek.

“In October, the bank puts it up for auction, or it forecloses,” Gearhart City Administrator Chad Sweet said.

While Gearhart’s Shannon Smith is listed on the property deed, she is not listed as a party to the foreclosure proceeding, which appeared as a legal notice in The Daily Astorian. The notice of default comes after Strickland’s failure to repay $297,741 and other advances and expenses. The property is scheduled to be sold at auction at Clatsop County Courthouse on Oct. 7.

The Neacoxie Creek Barn, at 774 Pacific Way in Gearhart, has been used for weddings, family reunions and other commercial events. Without a conditional use permit and a building occupancy permit, according to Gearhart officials, the owners have put the health and safety of guests and residents at risk.

“My property has been listed recently in legal notices, due in part, to personal impacts upon me and … most of all through political ill-will,” Shannon Smith said at a July Gearhart City Council meeting. “I am in conversation with prospective investors and co-partners who share my goal of preserving this unique historic resource for all of Gearhart to use and enjoy for many years to come.”

On Thursday, she said the loan is in modification consideration by the lender, which could end the sale proceeding. “Foreclosures are more common than people know,” she said. “They often get to this level and they get resolved. I’m extremely optimistic.”

Smith said she became an “underwater property owner” in 2007, within months of her purchase of the barn, when she was hard-hit by the economic downturn. “I have held on despite the land use and zoning approaches taken by the city’s officials in their interpretation of the allowed use of one’s property.”

A court order has suspended use of the barn until Smith meets conditions of city approval. In May, Smith said she plans to bring the building up to code.

If Smith violates the court order, she would receive a $500 fine for a zone code violation. This would be in addition to more than $30,000 in administrative fines racked up by Smith, an amount reduced to $15,000 by the Gearhart City Council in December.

Clatsop County Circuit Court Judge Philip Nelson extended an order keeping the former livery stable off-limits for parties and special events, at least until October.

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