Kathy Meeh - Budget Transparancy

I'm posting this for Kathy, and it is a wonderful indictment of our cheery and misleading City Council about our financial issues:

Letter-to-the-editor. Kathy Meeh, 1276 Alicante Drive, Pacifica, 650-359-9270. 6/20/08

Budget transparency

In their congenial deliberations, City Council claims to maintain a high standard of “transparency in government”, as a citizen who has observed all the budget meetings and done some research I don’t think that is entirely true.

City budget sessions were held by Council 4/16, 4/19, 5/12 and 5/21, with approval 6/9 for the 2008-09 fiscal year beginning 7/1. The process seemed more efficient and professional this year, thanks to Steve Rhodes, General Manager and City staff. Contrary to comments by Mayor Pro Tem Lancelle (6/18 Tribune), there were transparency problems in Council deliberations and communications with the public. There were also delays in website budget postings prior to 6/9, and gaps in detailed information.

Council discussion (5/21) over refunding bond debt from variable-rate to fixed-rate went something like this: “a steady stream of payments…I like that better… cities can borrow money at much lower rate than citizens”. Missing was the discussion about the additional $2 million dollars debt, and the plan to repay the loan.

Mayor Vreeland talked about the sewer tax rate increase in similar funding terms (5/12). Twice he repeated the improvement of the new fixed loan being a “steady stream of payment”. Missing was the connection to the actual 18.777% tax increase ($2 million) paid by homeowner and business parcel owners, and an adequate explanation why the increase occurred from the planned 9%.

This year the cost to run the Waste Water Treatment Plant is expected to be about $11.4 million, with $3 million (26%) of that total paying annual debt service only.

Mayor Vreeland (6/9) solicited the short-answer response from Ann Ritzma, Finance Director, that City loans “are mostly for capital projects”. The longer answer is that these loans are mostly for debt refunding of old capital projects, additional capital extracted, and debt is not paid down. Funding of the Police Station and the Waste Water Treatment Plant debt are two examples of this debt restructuring.

While the budget expenditure detail no longer includes a page describing “debt to project”, the audited Comprehensive Annual Financial Report to the State of CA, fiscal year ending 6/31/07, provides broad debt disclosure on page 112: $39,029,240 business-type government (sewer bonds and notes payable) and $56,629,618 primary government. Total City debt as of 6/31/07 was $95,658,858.

The completed 6/31/08 budget has yet to be audited, but Staff reporting indicates that current City debt must be about $100,000,000 or more. For those who have problems with zeros, that is more than $100 million dollars, continuing to grow.

When Mayor Vreeland was elected to City Council office in 1998 the City debt was $11,077,000, and the population was 40,381. Last year the audited debt was $95,658,858, and the population was 39,251. In the nine fiscal years from 1998 through 2007, the City debt “red ink” has increased $84,581,858, representing 8.64 times, or 3,641.55%. At the same time the population declined by 1,130 people.

Did you know the economic plan of this City Council is “recreation”, we live in “park city”, and an important part of the Mayor’s economic plan is “trails”? These communications and related “vision” were certainly not made clear to ordinary citizens, nor did we vote to defeat a viable, balanced economic plan for this City.

“Our environment is our economy” really, what does that mean? Infrastructure = loans or grants; City supplemental debt = parcel owners; City productive raw land = “open space”. Spin to citizens of this City = priceless. Isn’t it time for this City Council to step-down?

Kathy Meeh

Sun Valley

Proud Member of Pacificans for Progress, and Pacifica Business for Responsible Government

Deja Vu - City Attorney's Budget

published as a Letter to the Editor in the Pacifica Tribune, 6/18/08

I recall writing an article last year detailing our city attorney's budget, and how it was a significantly higher portion of our general fund than all of our surrounding cities. I also recall critics praising our city attorney for "defending" the city from developers, and we were told that our excessive city attorney budget was due to one case (Fish and Bowl) for which we would prevail. The city did prevail, and there was much back-slapping and self-congratulation.

Except city council has once again approved a city attorney budget close to $1 million. Their justification was "anticipated litigation."

When I pressed them at the most recent city council meeting to explain what litigation they were anticipating, there was no response.

In fact, the Pacifica City Council had discussed "pending litigation" during a closed session before this meeting, and the city attorney claimed they had nothing to report from that closed session. Exactly how does city council approve such a large budget with "nothing to report"?

As Yogi Berra said, "it's like deja vu all over again." First of all, who exactly prevailed in the Fish and Bowl lawsuit? The land was not developed and the developer will likely declare bankruptcy.

The city will see no financial benefits from development. The city recouped some of its legal fees from a contentious lawsuit with ABAG which, in my opinion, effectively destroyed any good will and our reputation with that respectable organization. In the end, the city spent over $5 million in legal fees, effectively crippling every other functional aspect of city government for 4 years, and the city still lost over $1 million even after the ABAG settlement.

Instead of negotiating in good faith, the city attorney got her rolodex of rich lawyer buddies even richer, while the citizens of Pacifica were deprived substantial tax dollars for basic city services. We, the citizens also paid for our failure to negotiate with decent city employees like Dave Carmany, Mike Angel, and Maureen Lennon as well as local citizens (Arno Rohloff) and businesses (Coastside Scavenger). The only people who have really prevailed are the law firms of Hanson Bridget LLP, Lombardi Loeper & Conant LLP, McDonough Holland & Allen, and others.

Not that I have anything against lawyers, and I don't begrudge them for earning a living. But I do begrudge our city leadership when they subsidize law firms from their refusal to negotiate in good faith, and proceed with what I view as fiscally irresponsible and politically reckless legal decisions.

"We are NOT no growth"

Councilwoman Julie Lancelle made that assertion at a rather contentious (and near riotous) City Council meeting last week (the fun part was hearing from a local editor that the City Council meeting was reminiscent of some late 80s and early 90s meetings where the "anti-development" crowd railed against the "pro-growth" City Council). The topic was the 18% sewer rate increase the city council approved, and many criticisms were directed at City Council for putting the financial burden of our town's solvency on the backs of homeowners, instead of growing our economy through smart growth and "sustainable" development.

Councilwoman Lancelle alluded to several developments they have approved (I think it was 4 developments over the last 8 years. Ayup, that's not no growth.) yet only the Connemara project has broken ground after over 5 years of contentious work with the planning department and the city.

It seems Mayor Jim Vreeland was gearing up the fight against development in the quarry by stating that houses in the quarry would have put more of a burden on the city's Calera Creek Waste Treatment Facility, thus raising sewer rates even more. This argument is too ludicrous to debate, except to say 355 simultaneous flushes in a city with 14,000 homes would have about the same effect of frog flatulence.

However, I recalled that I had run a column in the Pacifica Tribune that deserves to be revisited, detailing our commitment to "not no growth" under the current City Council (AUTHOR'S NOTE: I'm not sure of the exact date of this column, but it was written in October 2007 and, to date, the developers of both The Prospects and Harmony@1 have yet to break ground due to continued obstruction from the "not no growth" elements of Pacifica, despite City Council wink wink approval):

After my last column on the local need for housing, I was rebutted by a few people who felt we had “built out” and didn’t need any more residential units in Pacifica. I was challenged to produce a number of houses that would fulfill my theoretical “need” and create a sustainable economy for Pacifica. Though I haven’t reached a definitive number, I did discover a good start: 487.

According to the ABAG Regional Housing Needs Allocation figures from 1999 to 2006, this is the number of AFFORDBALE homes Pacifica fell short of its obligation for that time frame. In fact, Pacifica batted a woeful 0 for 120 in permits for Very Low Income housing (less than 50% of average median income, or AMI) and 0 for 181 in permits in the Moderate category (between 80% and 120% of AMI). According to ABAG’s data, Pacifica only granted 179 permits during this time frame out of a RHNA affordable housing obligation of 666 homes. 169 of these were in Above Moderate category (over 120% of AMI) and 10 were in the Low category (between 50% and 80% of AMI).

We fell short by 487.

http://www.abag.ca.gov/planning/housingneeds/pdf/resources/A_Place_to_Call_Home_2007.pdf

So as City Council voted to participate in the ABAG RHNA for 2006-2013 at its September 24, 2007 meeting, Pacifica had obligated itself to 275 homes out of the 15,738 designated for the San Mateo County subregion, or a mere 1.75%. Do we still owe for the 487 we failed to build for the last 7 years?

While we have recently passed an Inclusionary Zoning Ordinance which mandates a certain percentage of all new approved development proposals to accommodate affordable housing, will we have enough to meet our obligation this time around? Will the city and the adamant no-growthers who bend our ears on the opposition to any further population growth continue to stand in the way of meeting these obligations?

I do see a positive trend in the latest development proposals to be approved. The Prospects on Fassler has been approved by City Council and Harmony @ 1 has just passed muster with the planning commission, with unanimous support. I feel both projects are groundbreaking in their commitment to LEED quality standards (a measure of their environmental sensitivity), and I would encourage the city to view all future residential, commercial, and civic developments through the same “green” lens as these projects.

But both projects combined only bring in 42 housing units to a community that has eschewed its responsibilities to the growing Bay Area population for decades. As other cities grow and flourish, Pacifica sees its economy stagnate, propped up by property taxes, the sale of city property, and intergovernmental transfers for the last 4 years.

Also consider that there has been a tremendous slowdown in the housing market in Pacifica, with closed sales dropping from a peak of 423 in 2003 to 281 in 2006, and only 231 units sold in the last 12 months. The market for existing homes cannot be as competitive or lucrative as newer developments, especially developments that are as innovative and energy efficient as the Prospects and Harmony @ 1.

Affordable housing needs are geared towards community and civic professionals such as police, firefighters, emergency response personal, teachers, and city staff. A community flourishes by having its infrastructure personal able to afford living within its boundaries.

But a balance must also exist where new developments cater to the affordable elements AND the sustainable elements that can drive the local economy. Both of these elements are especially profitable to a city if they are located within a redevelopment zone, where the city realizes he most benefits from secured property taxes for the duration of the redevelopment designation. In conjunction with a revitalized commercial base, Pacifica can start making choices on how to spend our surpluses, and not on how to continually avoid our deficits.

Bay Solar Power Design Scandal

You hate to see a local business go bad, but I am stunned (along with other members of the community) at the turn of events with Bay Solar Power Design and CEO John Bannen.

Here's a timeline I've been able to assemble from the lawsuits posted on the San Mateo County Superior Court Public Records Index

http://www.sanmateocourt.org/midx/searchform4_tim.php

and news articles I've been able to Google:

6/12/06 – Bay Solar CEO John Bannen part of Livability Project/PSD presentation to Pacifica City Council to be part of “Sanchez Garden Education Plan”

10/29/06 – Quadrant Business Opportunities enters into agreement to represent Bay Solar to sell business for $10,000,000 asking price

12/12/06 – complaint filed by Karla Maree and Gary Miller

(Case CIV459498 )

1/25/2007 – complaint filed by SUNPOWER Corporation

(Case CIV460457)

2/15/07 – announcement of Bay Power Solar Design in Nigerian Conference in Toronto

http://www.free-press-release.com/news/200702/1171562943.html

3/12/07 – QBO modifies agreement to lower asking price to $3,000,000

8/21/07 – announce move to Fairfield

http://solanosgotit.blogspot.com/2007/08/bay-solar-power-design-is-moving-its.html

10/19/07 – ad in SF Chronicle

http://personalshopper.sfgate.com/SS/Page.aspx?adid=991363&secid=34491

10/24/07 – QBO alleges Bay Solar failed to provide financial statements to support $3,000,000 asking price for business, fail to secure ready, willing, and able buyers. They agree to commission settlement of $62,500.

11/13/07 – ad on vivagreen.com

http://www.vivagreen.com/companies/bay-solar-power-design

1/4/08 – complaint filed by TV20/KBWB

(Case CLJ469039)

3/6/08 – complaint filed by John Woodman (Quadrant Business Opportunities)

(Case CIV470953)

4/4/08 – complaint filed by Dirk Pranske and Curry Marketing Group

4/28/08 - WRIT OF EXECUTION FOR MONEY ISSUED TO SOLANO COUNTY IN THE AMOUNT OF $131,953.56 TO SUNPOWER

(Case CIV460457)

NOTES: Bay Solar represented itself as “fully licensed” to do this work on their website, but they were never registered with the Contractor State Licensing Board and never held a C-46 (Solar Contractor) license.

Vote Against the Proposed Sewer Rate Increase

Since 2002, the city’s sewer rates have increased almost 200%, from $4.69754 per 100 cubic feet of water consumption to $8.01056 for this fiscal year, and a proposed $9.51463 for 2008-2009. While the city floated the $51 million in bonds to build the “state of the art” Calera Creek Waste Treatment Plant 8 years ago, NONE of these increases have been applied to principal payment of these bonds. In fact, the sewer bonds were recast several years ago to be interest only.

Those principal payments are now due, causing a $1.3 million per year spike in our sewer debt obligations.

Yet this “state of the art” facility has continually violated discharge levels and the Clean Water Act (2005), been repeatedly cited and fined by the California Regional Water Quality Control Board almost 200 times, and recently had a spill of 7.5 million gallons of partially treated sewage that went undisclosed to the public by our City Council. Not to mention the odor problems that make some days in Vallemar and Sharp Park unbearable. The "fix" to the digesters has been ongoing and, during last year's election cycle, we were assured the costs would be $200,000.

Because the city chose experimental technology with a company that has since gone out of business, these fixes have been prolonged for years at an estimated cost of $2 million, with no certainty the smell issues will be completely abated.

So where did this money go from all these rate increases?

Amid all these “growing pains” with the plant, the city was transferring $700,000 per year from the Sewer Enterprise to its General Fund for “in-lieu property taxes”. While legal at the time, that money was used to plug holes in a General Fund that has seen almost every indicator of economic growth spiral downward since 2002..

The "Big Horn" supreme court decision put an end to the in-lieu property tax practice last year, and now the homeowners are being asked to fill this financial gap.

While the city expended over $80,000 of its own money for lawyer fees to contest "overcharges" by Coastside Scavenger for our trash removal, they managed to do with the Sewer Enterprise exactly what they accused Coastside Scavenger of doing, except the city did it on a much larger scale for a longer period of time.

As a responsible homeowner, I would be certain to attend the sewer service charge increase meeting in Council Chambers at 7PM on May 12, 2008. You can also file a written protest with the city by submitting a letter which simply states your name, address, signature, date, and words to the effect of "I protest the proposed sewer rate increase."

Welcome to PacifiCon - Our Mission

Welcome to PacifiCon, a multi-author blog, set up to keep residents of Pacifica current on the issues affecting our town. We are dedicated to guiding our city to responsible governance, fiscal responsibility, rational protection of its glorious natural beauty, and the sensible, necessary development required for prosperity.

We believe the current government of Pacifica is failing in all these critical areas.

In these "pages" you will find in-depth discussions of issues facing Pacifica that have been given short shrift in other venues. It is our goal to present, without bias, the full, real story that so often is lost in the translation to bumper sticker sloganeering.

We hope that these pages will provide a place for in current concerns, new ideas, innovative solutions and, of course, civil discourse.

Anyone with a concern or a local issue you feel needs expression or discussion, please write to us at: PacificonHQ@gmail.com, and one of us will contact you promptly.

Working for a bright future for Pacifica,

PacifiCon Authors