A few years ago Cal State Fullerton decided to get into the housing business for its employees. Why public employees should get any sort of preferential treatment for housing is beyond me, but that’s the society in which we live.
Anyway, the whole thing turned out to be a massive disaster, but not an embarrassment, of course, for such things are not permitted in the lofty ether of educratic circles. FFFF posted about it here, and here.
Recap: the university made a deal with the Elks for land up on Elk Hill and sold a bond to build a bunch of cookie-cutter tract duplexes that were to be sold to professors and administrators, and such like, and subsidized by you and me. The only problem was that an underlying deed restriction required sale to others in the same category, an encumbrance that turned out to be a lot more than a mere nuisance, especially when real estate prices were plummeting all over the place.
The university also had the responsibility to make monthly payments to the Elks for their land, which were to passed on to lucky buyers: a sort of Mello-Roos arrangement, if you will.
But nobody was buying. So the university opened up residence to any government workers. Still no sales. Finally they just started renting them out to anybody with a cleaning deposit and first month’s rent. Could it get worse?
Looks like it could. Persistent rumors suggest that CSUF wants out of the University heights disaster altogether by completely removing the deed restriction and just selling them off – individually or as a group – no doubt at fire sale prices. They obviously need the cash.
The losses on the original deal would be quietly swept under the rug – no doubt with diminishing fund balances bailing out the catastrophe.
And what for? According to an acquaintance at Western Law School, CSUF wants to buy their facility for $20,000,000, give or take, and metastasize across State College.
It’s pretty clear to me that the CSUF appetite for real-estate wheeling and dealing is insatiable, even as the CSU system teeters on the financial brink. It’s also clear that nobody is going to be held accountable for the University Heights quagmire. F. “Dick” Jones, the City mastermind, is recalled; his buddy, former City manager Chris is fatly pensioned off; Bill Dickerson, the CSUF architect of the fiasco is retired, too. CSUF President, the dopey Milton Gordon? You guessed it. Gone, as well.
Would it be asking too much for our State Assemblyman Chris Norby to demand an inquiry on what unfolded up on Elk Hill?