Revenue Enhancement

M. Eric Levitt. Will he save us from ourselves?

It seems like every few years Fullerton City Councils are presented by the bureaucracy with a new “fiscal cliff”: It’s done slowly, tentatively, and then with an ever-increasing tone of persuasion, the argument for “revenue enhancement” unfolds.

Revenue enhancement means taxes or debt – one way or another. And so it is in 2024.

With time running out to put a tax increase on the November ballot, the urgency from “staff” is getting more direct. Time has run out for soft-sell concepts like phony push polls of unwitting citizens. At Tuesday’s council meeting our esteemed City Manager is presenting ideas for raising money.

Well, it might work…but, then again…

TOT Tax. What is a TOT tax? Transient Occupancy Tax is a tax levied on visitors who stay in Fullerton hotels. The staff report tells us that several million can be raised with a slight increase and that hopefully we will remain competitive because we are so close to the Anaheim “Resort.” No on can prove this one way or another, but it seems like becoming comparatively less competitive is a poor way of raising revenue. The positive thing about a TOT increase, says the staff report, is that Fullerton taxpayers won’t be affected (unless, of course the concept turns out to be a money loser).

Sales tax. We have already seen the sales pitch on how a general sales tax only needs 50%+1 to pass. We are told that a “1%” increase (from 7.75 to 8.75) on sales tax is being pursued by cities up and down California, etc, etc. Of course they think we’re too dumb to know that this isn’t a 1% increase, but a 13% increase. As with a TOT increase, it’s hard to see how becoming comparatively less competitive is going to make money. The sales tax issue seems DOA. 4 votes are needed to put this on the ballot and Whitaker and Dunlap aren’t going for that.

POBs. And then we see the concept of Pension Obligation Bonds, in which bond revenues are deposited with CalPERS to buy down the actuarial unfunded liability. The idea is that the interest rate on the bonds is lower than the return CalPERS will give us and the difference is all gravy. This idea was floated back in 2021 by then Interim City Manager, Jeff Collier. FFFF covered the proposal, here. One upside is that this scheme is not constrained by the usual debt ceiling limits placed on local governments by the state. Great. More gambling.

Well, there she goes. Don’t worry. There’s more where that came from…

Mr. Collier was kind enough to visit our humble site to educates us on POBs. Friends immediately pointed out the risks involved with POBs, and the lack of skin in the game Collier and his pals had. And that was three years ago when market interest rates were way lower. The equities market is now going through the roof so the idea looks appealing to our bureaucrats, but not to California pension system observers who note CalPERS ever-declining return assumptions and remember the disaster of 2008. Will the City Council approve this gambit? It’s possible, and a public vote is not required.

Hey, you down there…

These various options involve raising taxes or encumbering property to some extent. That’s risk with a speculated payoff. Ahmad Zahra is bound to support anything risky and foolish so as to protect his friends in City Hall. So is Shana Charles, another liberal torchbearer who will tell us this is for our own good; or for the urban forest; or for boutique hotels, or something else nonsensical. Whitaker won’t go for any of this nonsense. Dunlap? Who knows these days. And then there is Fred Jung who had the opportunity to be the third vote to shut down talk of revenue enhancement last year and didn’t.

Hero. Deserve.

A problem with any tax revenue increase is that the increase, such as it were, will immediately be snatched up by the so-called “public safety” employees, whose unions have the clout to grab what they want and everybody else be damned. That’s exactly what happened in Westminster a few years when the cop union pounded the pavement for a sales tax increase, got it, then gobbled it all up. And Westminster is right back where they were before.

No Solution in Search of a Problem

Clean sweep

Back on its May 7th meeting the Fullerton City Council had a hearing about street sweeping ticketing. It was such a super-critical issue that the Voice of OC wrote about it here. The author is none other than Mr. Hossam Elattar, the same boob who missed the Trail to Nowhere scam.

So many injustices, so little time…

Reading the Voice article you get the idea that the ticketing was a great social injustice, affecting the lives of what the author charmingly calls the “working class” in overcrowded parts of town. This is the editorial narrative the Voice of OC always deploys in its “news” – the oppression of the underserved.

Of course at the meeting, this same tack was immediately propounded by Councilmember Ahmad Zarha, who would go on to conflate this parking issue with the principle one affecting neighborhoods with too many cars: overnight parking bans. But a hero needs a problem to fix for the “poorer part of town” as he put it. The two issues are quite different since cars of the “working class” are used, presumably, to take those people to work and are gone when the sweeper rolls by. Oops.

The sweeping problem is that regular street sweeping keeps our trash out of the Pacific Ocean and instead goes to a big hole in a Brea hillside. The storm water system is regulated by National Pollutant Discharge Elimination System (NPDES) permits. The age-old practice of allowing cars to park on street sweeping days is no longer a thing.

Good Lord, what a to do over a non-problem.

Staff, to their credit, recommended to keep things the way they are – weekly sweeping of each side of each street, and tickets for those vehicles that haven’t been relocated.

Three proposed “options” added significant costs for more complicated logistics and signage, or a violation of the NPDES permit. Whether these costs were legitimate or just jacked up to undermine the options is open to cynical speculation. Obviously, the violation option was just an obvious non-starter made to look like a choice. And with our latest budget crisis nobody is going to waste hundreds of thousands down this rathole.

Our city council (Fullerton, being Fullerton) hemmed and hawed and finally decided the current system was flawed and requested new options. Our Mayor, Nick Dunlap was not happy with the “one size fits all” approach and found an ally in Ahmad Zahra who again pitched the issue as a discriminatory one since the most ticketing took place in south Fullerton. Fred Jung didn’t say much except to say he wanted something better, or to leave the status quo. All so helpful. Dunlap even proposed possible refunds to ticket receivers.

So just as with the downtown noise fiasco this issue will be kicked around some more. I’m surprised it wasn’t sent to the Traffic and Circulation Commission for lengthy cogitation.

No one really bothered to ask what the big deal was and how come people can’t get off their asses and move their cars. Yes, multiple-hour windows of time are used for sweeping, but in reality the sweeping schedule is an extremely predictable period of time, easily planned for. No tickets are handed out after the sweeper passes. While it’s true people may forget to attend to their vehicles, the cost of a ticket is educative, as I well know. Also, my street is a few blocks away from an overcrowded collection of 1950s apartments with too many cars. And yet, on street sweeping days these good folk are astute enough to relocate their vehicles by the time the sweeper rolls through. And after it does the streets slowly fill up with cars again.

I’m left wondering how this item was even agendized in the first place. Staff didn’t want it, obviously, so it must have been done at the behest of councilmembers looking for an issue to waste their time and our money on.

The Fiscal Cliff

The Fullerton City Council is holding a special meeting tonight – a 2024-25 Budget “workshop.” No work will get done but there will be shopping going on as staff begins its formal press to raise a sales tax.

There is a lot of self-serving verbiage about how well our City staff has performed its tasks up ’til now, but then the hard reality hits because budget numbers can’t pat themselves on the back.

There are some harrowing numbers in the proposed budget – including a $9,400,000 draw-down from strategic reserves. This means of course, that the budget is no where near balanced as City Hall apologists like Jennifer Fitzgerald and Jan Flory claimed when they ran the place into the red almost every year.

M. Eric Levitt. Will he save us from ourselves?

Let’s let our City Manager, Eric Levitt tell the tale:

Financial Stability. The City has been able to over the last two years (for the first time in recent history of the City) to reach and maintain a 17% contingency reserve level. This budget maintains that reserve level; however due to an operating deficit, we will be utilizing one-time excess reserves this year and coming close to that 17% level in FY 2024-25 and below that in years beyond next year

Read. Weep.

The overall picture gets even worse as the levels of reserves slowly dwindle away. After this year Fullerton continues to be upside from $7.5 to $8.8 million each year until the end of the dismal decade. We are not favored with the running reserve funds balances.

Infrastructure is supposedly a big deal. Which reminds me of a quotation attributed to Mark Twain: Everybody talks about the weather but nobody does anything about it. But this year we are told, we can push get going on our deteriorating infrastructure along by borrowing! Once again let’s heed the words of Mr. Levitt:

I have also put together a strategy to increase that funding level to closer to $14 million over the next four years through the use of financing. However, there are both upsides and downsides to this approach which will be discussed with you in more detail at today’s presentation.

Now this should be a red flag: borrowing to perform maintenance, a basic accounting no-no. And what form will the borrowing take? Not a municipal bond, you can be sure, It would likely be by selling certificates of participation or some other dodge to avoid municipal debt restrictions. Here’s the table that shows our Maintenance of Effort (MOE) shortfall without financing.

Now we all know that interest payments are made by somebody, somewhere, and that somebody is you and me. We get to pay the interest on debt incurred by years of municipal mismanagement by people like Joe Felz and Ken Domer and Jeff Collier who get to sail off to a glorious and massively pensioned retirement at 55 years of age.

And finally, to circle back to the story lead, here’s a distasteful nugget carefully slipped into the City Manager’s report:

“Staff recommends City Council review options over the next year to stabilize the budget and ensure the City remains financially sound.

Jesus H. There it is. Not quite explicitly stated, but we know very well where this is going. Another general sales tax effort, just like the ill-fated Measure S of four years ago. The seeds for this have already been planted, of course, in a nasty little taxpayer-funded fishing expedition in the guise of a community survey. Last November I regaled the Friends with this slimy maneuver, here.

How did things get so bad?

By the way, this is exactly the same process City Hall rolled out four years ago. And we will be told By Ahmad Zahra, Shana Charles and Vivian Jaramillo that if we don’t pony up we will be morally deficient.

Well, good luck Friends. This is going to be a long year and you can bet the farm that we will be asked to pick up the check – again.

Dysfunction Junction

Denial is a fairly common human condition, but normally it involves interpersonal relationships and fact isn’t always that easy to ascertain. It is also quite common in politics where one’s emotional beliefs and prejudices are set against somebody else’s. And then there’s the case when bald facts are staring you in the face and you just can’t allow the cold truth to intrude upon your fantasy.

Nowhere is the latter situation better seen than in the City of Fullerton’s attitude and actions involving the “downtown” area.

Business is booming…

It’s not real complicated. The City has known for almost two decades that downtown Fullerton was a money loser. A big money loser. And yet nary a word of complaint or criticism of the booze culture of downtown Fullerton has been uttered by the bureaucrats and politicians.

The most recent analysis was essayed 7 years ago. Here’s the money shot:

In 2017, the taxpayers of Fullerton were subsidizing the bar owners to the tune of almost $15,000 per liquor joint, each and every year. Three quarters of a million a year. Of course this was just for “public safety” as noted:

We focused on the public-safety facets of this study alone, and did not include the development and maintenance services costs Fullerton audited. We illustrate below Fullerton taxpayers were effectively subsidizing bar and restaurant establishments – to the tune of about $15,000 per establishment – all to cover the costs of police, fire and rescue services provided to the establishments and their patrons.

We know that maintenance and code enforcement and the legal services of Dick Jones and his I Can’t Believe It’s a Law Firm jack up the cost to well over a million bucks – $1.4 million being the overall cost previously discovered. And there are now over 50 bars.

Another award!

Think of it. During hard times and good, the taxpayers of Fullerton subsidize the likes of the Florentine family and the Marovic mob and the Poozhikala posse, while they make a fortune peddling fish bowls of booze to out-of-control miscreants and ignoring the law.

And still City staff insists on describing downtown Fullerton a glowing success story, a triumph to be built on; of course they aided and abetted in the charade by city councils that are marked by political cupidity, stupidity and a desire to look like they have accomplished something. Anything. For decades these people have crowed about their achievements in DTF, even as they desperately crammed more and denser housing blocks in and around main streets – hoping a captive audience would somehow help. It didn’t, and by the early 2000s the City decided an open air saloon was just the thing. And then the restaurants morphed into bars and then the bars morphed, illegally at first, into nightclubs.

I can keep this up all night…

As things got more lawless, and even some like Dick Jones lamented the “monster” he had created, the only thing that happened was that things got worse. Blasting noise, random violence, sexual assaults, human waste, mayhem, shootings, sadistic and pervy cops – you name it – caused no retrospection in City Hall about what had, and what was happening. It was all a big victory, and you don’t second guess a victory.

Well, things are looking glum fiscally for Fullerton according to last years budget projections and we will be told Ahmad Zahra and Shana Charles that we must bear the burden of a new sales tax jack-up in order to keep the creaky old jalopy going.

I say fix the financial sinkhole that is downtown Fullerton before you stick your hands in our pockets.

An Unhappy Anniversary

And what anniversary might that be, Friends may be asking.

Not gone, but almost forgotten…

This Wednesday, March 27th, marks the one-year anniversary of a deadline date agreed to by the City of Fullerton and one Mario Marovic, a downtown bar owner. Not much of a deadline, huh?

Hey, that’s not yours!

By March 27th, 2023, Mr. Marovic was required to have started demolition of the so-called “bump out,” an illegally constructed room addition built by the Florentine Mob two decades ago on City property. Marovic had gotten rid of the Florentines, finally, but decided that the leasehold on the room addition was somehow ripe for the encroaching. So he began remodel work on the leasehold right along with the rest of the building that he does own.

Busted.

Meet the new proprietor, same as the old proprietor…

But Fullerton being Fullerton, where nothing seems to be done right in City Hall, and where downtown scofflaw saloon owners do whatever the Hell they please, Marovic seems to have decided that the deadline meant, and means, nothing. And why should he believe otherwise? He has seen firsthand how the City bureaucracy and the City Attorney bent all the way over for the Florentines – instead of making them obey the law.

Well, the Earth has made an entire revolution of the Sun.

The City Council may occasionally talk about this in their hush-hush, top secret “Closed Session” meetings, but the public is not to know what is happening, even as our money and property are being frittered away. We do know that Marovic has threatened a claim against the City, but so what? Why would that be cause for the City to ignore Marovic’s breech of contract and seize the public property that Marovic encroached on illegally?

dick-jones
Staying awake long enough to break the law…

The reason could be that our esteemed lawyer, Dick Jones of The I Can’t Believe It’s a Law Firm, believes upholding agreements is not a winning strategy. Of course this third rate pettifogger has won so few cases for us, and has lost so many that we may feel confident questioning his judgment.

Or, it could be that the feckless and spineless City Council has been individually persuaded by Marovic that it’s in their best interest to ignore the deal, and that they should just let Marovic keep raking in the bucks thanks to a Conditional Use Permit that was contingent upon the removal of the room addition.

The 2024 4th District Election

As the Friends know, Fullerton’s First, Second and Fourth City Council District representative jobs are up for election this fall. And while it’s a little early to speculate on who’s going to run and what the outcome might be, it’s fun to do a little introductory review.

Dunlap-Jung

Incumbents Fred Jung and Nick Dunlap are incumbents in the First and Second Districts, respectively. If they want to run again, and I haven’t heard they won’t, the power of incumbency is hard to beat.

Going, going, gone…

The Fourth District, currently represented by Bruce Whitaker will be wide open. Whitaker is termed out after 12 long years on the Council and his replacement will decide the balance of the Council if Dunlap and Jung run, and are re-elected. The current 3-2 division is based on ideological difference, the difference is between looking out for the taxpayers – at least once in a while – and doing whatever idiocy the bureaucracy wants to perpetrate.

Yes, I do so live here.

At this point the candidate pool seems weak. Last time Whitaker squeaked by past a dude named Aruni Thakur, a school board member who didn’t live in the district. Could Thakur do the (fake) carpetbagger routine? He had the full support of the unions and the County Democrat Party four years ago, but it wasn’t enough for poor Aruni, who was hammered with his carpetbaggery. With no incumbent this time around his political greed might pull him in.

Vivian “Kitty” Jaramillo

Then there is a woman named Vivian “Kitty” Jaramillo, an individual who has made a nuisance of herself recently attacking the Council majority with the usual feigned outrage. Ms. Jaramillo is retired from “work” as a life-long municipal employee whose professional career started in Fullerton handing out parking tickets and graduated into being a code enforcement busybody. She would be a perfectly reliable yes vote for anything floated by city staff, and just the sort of running buddy Ahmad Zahra dreams about to support a sales tax. Word on the street is that the OC Dems are already behind her candidacy, which would preclude the aforementioned Thakur from getting involved.

Jaramillo ran for the City Council in 2012 and came in 7th in a city-wide election. Two years ago she was appointed to the redistricting committee where she championed the failed, ridiculous district map meant to keep the lamentable knucklehead Jesus Quirk-Silva in office.

Jaramillo’s other claim to fame, besides pestering the City Council these days, is suing the City in 2015 to create city council districts – very likely so she could run herself someday when Whitaker termed out.

So far no one from a more responsible philosophical perspective has raised their hand in D4, but as noted above, it’s still early in the year and filing doesn’t take place for almost another five months.

Council Ponders Parking Puzzle Pilot Program

Lots of people have lots of cars. And the on-site parking plans of the 50s, 60, and 70s multi-family housing just don’t work anymore. We all know that. Even single-family neighborhoods suffer from the same issue – adults’ cars, their kids’ cars, and a garage full of crap.

In 2023 the Fullerton City Council directed staff to consider the issue of early morning parking prohibition, a device to keep people from parking on the streets overnight. The current situation is that certain streets with multi-family housing or old, pre-1940 houses have been granted a waiver. An applicant’s address could also get a one-year “hardship” permit with an extensive review process and a $250 permit fee.

After an 11 month gestation period, staff labored hard and gave birth to a “pilot plan” proposal that would keep existing street and individual waivers/permits, but that would make it easier, supposedly, to get a one year permit – with four one-year options.

The issue is Item #7 on the 3/19/24 Agenda consent calendar.

The staff report provides the usual entertaining history of a Fullerton topic, like downtown nuisance noise, that never seems to get fixed.

As usual there are options presented that are really just non-starters to make the desired option look better. Option 1 is to do away with overnight parking altogether – a surefire recipe for political disaster. Option 2 is to get rid of street/block waivers and also hardship permits, and let anybody apply for an overnight permit – another sure loser.

And so Option 3 (as described above) gets the brass ring, with the proviso that it be a 2-year pilot program to see what happens. As noted, staff is proposing a streamlined process, online portal, etc., etc., with one goal being to help disadvantaged neighborhoods (of course “disadvantaged,” like “underserved” is code in City Hall for Latino, so that’s an interesting use of the word). This option begs the question: if the permit process could be streamlined why wasn’t it – a long time ago? There is no mention of the new permit fee amount.

The staff report contains a long list of possible additions that could be made, presumably to help a City Council that can’t be trusted to come up with its own.

What I think is really interesting is that there is no option for doing nothing. Not every snake or green-glowing rock needs to picked up and examined, and I get the impression that there is a political undercurrent here. Commonsense suggests that adopting a revision for the purpose of allowing more cars to park overnight will still annoy some residents who may not like others parking in front of their house all night – especially in the vicinity of under-parked, older apartments.

Trail to Nowhere Pests Throw Party

A Friend just forwarded notice that something called South Fullerton Community is holding a “recognition” celebration this Saturday. The cause? Recognizing “community leaders” for succeeding in pestering, insulting and generally annoying Councilmembers Dunlap, Jung, and Whitaker until the latter finally caved in and approved the $1.7 million State grant to build a recreation trail through the middle of the worst industrially blighted, drug-riddled and gang infested strip in Orange County.

Hubris doesn’t seem to be something the South Fullerton Community folk worry about.

Of course this unheard of group was obviously created by and exists solely as a prop for Councilman Ahmad Zahra. Ironically, they won’t be holding their victory party anywhere near the site of the Trail to Nowhere. That would be a bummer for the celebration.

The announcement says that Assemblywoman Sharon Quirk Silva will be there to recognize the achievement, which makes sense because she doesn’t have any. Senator Josh Newman knows better than to bless this disaster-in-waiting by his presence; but maybe Gas Tax Josh doesn’t know better. This is the same guy who passed a regressive tax increase on his constituents the day before he left town for a Caribbean vacation.

And still the problems of the Trail to Nowhere appertain: a fraudulent grant application that omitted mention of contaminated soil and lied about the number of potential users; 10 active testing wells for trichlorethylene on the site; gang graffiti everywhere; homeless encampments; and of the cost of ongoing maintenance that no one has accounted for. Then there is the rosy, 5 year old budget that won’t get the deal done and will require additional money that could be used on other facilities.

RIP

Will any of the celebrants care about the true facts of the Trail to Nowhere? They haven’t so far. Will any of them stand up in a couple of years and apologize for the harebrained scheme? Of course not. All the people in charge of this mess know it as a fact that government has no rearview mirror and that mistakes may have been made (passive voice) but:

  1. Not enough money was spent.
  2. The people in charge have retired.
  3. Critical information was withheld by someone, possibly, but it was all a worthy gesture.
  4. It’s not a disaster it’s a victory!!
  5. Hindsight is 20/20.

Of course this being Fullerton the subject probably won’t come up at all, just as no one even bothers asking about the 20 year old embarrassment known as the Union Pacific Park.

I wonder if the party-givers have invited Messrs. Dunlap, Jung and Whitaker to their fete. They deserved to be recognized, too, and maybe even get a certificate of achievement.

Fullerton City News Opines on Noise Debacle Downtown

Just kidding…

A publication called Fullerton City News features a very detailed look on the embarrassing nuisance noise situation created by Downtown Fullerton’s scofflaw bar owners, and the even less than feeble efforts of the City’s code enforcement crew to do something about it. As FFFF noted, here, City staff’s latest response to the 15 year old problem is to let the noise get louder.

By the way, I enjoy the fun Fullerton City News masthead and logo. It’s a takeoff on the city seal, and a nice and well-deserved shot at the less than worthless Fullerton Observer pretending to be “independent.”

Here’s the story:

“Since 2009 the Fullerton City Council has been going back and forth with bar owners and their proxies on City Staff, specifically in the Community Development Department, over how loud Downtown Fullerton should be on any given night.

The short version of this story is that staff is trying to implement a “noise zone” in Downtown Fullerton. Despite building housing basically on top of the bars (and approving a hotel at the train station), somehow it makes sense to make this mixed-use residential area LOUDER.”

See the whole article, here.

A Tale of Two Trails

A Friend has alerted us that the on-line version of the Fullerton Observer posted a story by somebody named “Emerson Little” about a little known Fullerton trail called the Lucy Van Der Hoff Trail. The title? “Lucy Van Der Hoff Trail Needs Maintenance.” It seems that almost nobody knows about this .9 mile “asset” even though it is City-owned.

Unfortunately, the “trail” is overgrown, full of trash, and is yet another shining example of neglect by our top-notch Parks Department. Fortunately, the intrepid Emerson took the trail and generously provided images. But let’s let Emerson tell it in his own words: .

“It’s maintained by the Fullerton Parks and Recreation Department and is listed on the city’s website as a connector. However, when I walked on the trail, it was rather overgrown and poorly maintained. In certain spots, there were quite a few lost objects and pieces of garbage, possibly swept down the pathway by rainwater.”

Put on your walking shoes…

So, the City has completely failed at maintaining the Lucy Van Der Hoff Trail – even as a simple mountain bike trail. They seem actually have completely ignored it – a facility that should cost almost nothing to maintain. It’s alleged “connector” value is almost useless.

It’s the thought that counts…

More from Emerson: “I stepped around some discarded plastic bags, bottles, pillows that were torn open, unidentifiable articles of clothing, pieces of broken wood, old soccer nets, and cans, making my way forward.” When the overgrown vegetation became too thick our brave explorer had to ditch the “trail.”

Finally, here’s Emerson wrapping up the tale of his Big Adventure: “So, while my hike was interesting, I really wouldn’t recommend taking the Lucy Van Der Hoff trail.”

And now, Friends, here’s an observation that seems to have escaped the keen notice of the Observers. The advocates of the infamous Trail to Nowhere on the old Union Pacific right-of-way tacitly believe (or pretend to believe) it is going to be maintained – 170 trees, hundreds of shrubs, water lines, irrigation systems, benches, paths, signage, light fixtures – and let’s not forget graffiti removal, etc. – even though there is no budget to do this, and the money can’t be looted from the Park Dwelling Fund which can’t be used for maintenance.

We’ve already seen the maintenance fiasco of UP Trail Phase I – the plant denuded, trash filled, urine soaked predecessor of Phase II that nobody in City Hall has given a rat’s ass about. And Fullerton is also facing a fiscal cliff thanks to years of budgetary mismanagement.

Several months ago FFFF received a comment from former City Manager Chris Meyers, warning about the foolishness of building something that doesn’t have a plan for maintenance cost. But Ward 5 Councilman Ahmad Zahra believes even talking about maintenance issues south of the tracks is “offensive,” the idea being that it’s great to give the “underserved” barrio “something nice,” but who cares what happens to it later. It’s like giving somebody a car when they can’t afford to buy gas, or insurance, or keep it running. Looks like Zahra’s colleagues all agree – even though the very same people can’t figure out how to open Union Pacific Park – another embarrassing disaster.