Revenue Enhancement Time. Plus Lies and More Lies

Last Tuesday the Fullerton City Council voted 4-1 to approve the ’24-’25 city budget. Whitaker, as usual voted no. The budget projects big deficits as we’ve already heard.

After that the Council was presented with “revenue enhancement” ideas – the same old nonsense that we’ve already talked about, here. At first these ideas were simply floated to make it look like somebody had given some thought to find other ways, however silly, to address the tsunami of red ink; but in reality the point was to push a general sales tax, a movement that had been subtly going on for many months.

However the proposals agendized last Tuesday did not include a sales tax this fall, a sure indicator that the City Manager has polled the Council and knows he doesn’t have the votes to put it on the ballot. But that didn’t stop Councilmembers Charles and Zahra from pitching and pitching and pitching the idea; and finally supporting each other to get the issue of a sales tax on the an agenda, pronto, in time to schedule it for the November election.

But before that happened the public was treated to some of the most blatant and self serving re-writing of Fullerton history I have ever heard.

If I knew what I was talking about this wouldn’t be Fullerton!

Shana Charles started off with long-winded blabbering that was irrelevant, self-contradictory, confusing, and erroneous. Of course – “decimated” staff, the ill-effects of right-sizing,” reduced response times – the usual liberal litany of problems were simply meant as an introduction to the sales tax proposal. Her complaint was that previous councils had made mistakes, not by exercising fiscal restraint, but by “cutting to the bone.”

Charles then lauded the wonderful benefits that the City of Placentia derived from it’s Measure U sales tax that saved it, having declared bankruptcy – a statement completely false. She failed to mention the fact that Placentia has saved millions by getting their “fire fighters” out of the paramedic business, an idea of which her Fullerton fire fighter union pals are terrified.

While patting herself on the back for very recent staff and service level increases, she failed to see the rich irony of her own incompetence on the edge of a precipice: a situation well-understood when she voted for last year’s budget.

More economic development, better wardrobe…

If Charles blathered nonsense, Zahra just lied about Fullerton’s recent fiscal history, most likely because he has been on the City Council for 6 years, and has his greasy fingerprints all over the budgetary disaster.

According to Zahra, our problem reaches back decades and only now is the Council addressing the problem. Of course our City Councils have made bad decisions over the years, but the current disaster is of very recent vintage and has also occurred while he has been on the City Council.

For several years in the mid and late teens Fullerton was dipping into reserve funds to pay the freight, even as Zahra’s allies Jan Flory and Jennifer Fitzgerald and Jesus Quirk- Silva were lying to the public about the budget being balanced. It wasn’t. In fact the City continued in its cavalier way until Fred Jung and Nick Dunlap joined Bruce Whitaker on the council in 2020.

Measure S Covid Lie
Let me count the ways…

Zahra related how he, as a precinct-walking candidate, noted how people wanted better roads and how his predecessors had promised them, too, but that they failed. He didn’t note the fact that Fullerton’s public safety employees were hogging up bigger and bigger shares of the budget – as they still do.

The subject of Zahra’s failed 2020 Measure S sales tax came up, a sore subject, apparently, since his underserved constituents in D5 voted for it. So let us not stop from revisiting it, and right now! Charles chimed in that well she people she spoke to voted against it because there was no sunset provision, and, get this – because there was no oversight committee!

As an aside, I have to share that Zahra made an hilarious little speech about he could not support an infrastructure improvement bond because voting for municipal debt would keep him awake at night!

It’s not rocket science…

Bruce Whitaker made just about the only insightful comment of the discussion, namely: that cities can control costs but they can’t control revenue, an observation that flies in the face of the revenue enhancement propaganda, but that is perfectly true. As has been stated here before: nobody even knows if an Economic Development Manager even pays for himself in terms of incremental tax increase.

I will wrap this up by acknowledging a Zoom caller who actually did make a good revenue enhancing and who identified a huge fiscal problem: downtown Fullerton, the annual sinkhole that makes millions for the scofflaw club owners and that leaves the taxpayers with a $1,500,000 bill. He suggested a special assessment on these eager party entrepreneurs to pay for the havoc their booze and their customers cause. Not surprisingly, none of the council members even mentioned the problem. They never do.

The Abdication

Lots of Indians, but no chiefs…

I’ve been watching Fullerton politics and governance for for a long time – since 2008 or 2009, in fact. One thing that has consistently struck me is the way in which Fullerton’s elected officials have completely and almost happily abdicated their responsibility to determine the direction of policy.

It has always been the goal, in principle if not in practice in modern representative democracy, that policy would be established by electeds, and administrated through a protected civil service bureaucracy.

Determining policy – the philosophical direction you want the town to take – isn’t easy in the “City Manager” form of government, a form deliberately created to remove any sort of executive authority from elected representatives. But with that set-up came something else, too: the difficulty of people’s representatives in establishing policy direction, and doing it without violating the Brown Act strictures on open meetings.

Nevertheless, the responsibility is still there, even if it easier to have photo ops, and ribbon cuttings and the like. Sadly our electeds have failed; failed with remarkable banality and complacency. Former Councilman and Fullerton Police Chief Pat McKinley once illustrated the point when challenged for his “failure to lead.” He exclaimed that councilmen weren’t there to lead – that was the City Manager’s job.

Lately the policy role abdication has been seen with the regurgitated, spit out, re-consumed and regurgitated again noise ordinance, an ongoing embarrassment that has plagued honest citizens for over fifteen years. I read the staff report on the recent noise effort, a report that justifies a decision to actually increase acceptable levels, protect offenders by including an ambient noise mask, and locates the noise metering away from the source whence it can be muddled by an equally noisy neighbor.

The staff report is nothing but a list of events that have occurred since 2009 when the City Council last expressed a coherent position. Nowhere in the staff report is there any discussion on the policy decisions behind any of the activities. Why not? Because there weren’t any. In the same way that the incredibly costly, drunken binge known as Downtown Fullerton has escaped any intelligent policy conversation, the noise nuisance issue, a subset of the former, has evaded policy discussion as City staff – behind the scenes – has diligently avoided doing anything to enforce existing code, and worked very hard to reduce the requirements.

So what has happened is a vacuum in which each new action seems disembodied from policy conversation; that’s because it is. And our council steadfastly refused to have an open and honest conversation of what it wants, abdicating its responsibilities.

One size fits all…

There is a long list of issues that our elected representatives should be addressing from an overarching policy level and aren’t. This sort of thing takes thought; and some hard work in ascertaining whether your city employees are really doing the thing you want; or not, as in the case of the Trail to Nowhere. It’s easier just to ram through the Consent Calendar on the nod, rubberstamp the ridiculous, clean your plate like good kids, and move on to the photo ops and the trophy ceremonies.

I Think I’ve Seen This Movie

It’s real expensive, but it sure is short…

When thinking about the Trail to Nowhere it seemed to me that I had seen this same sort of thing before. Then it struck me. Of course.

An expensive and unnecessary project that dragged out for years, and that was supposed to be paid for with other people’s money, “free money” as it is known in City Hall, I recalled.

It may have been expensive, but it sure was unnecessary…

I remembered because I wrote about it, here. The second elevator towers at the Fullerton train station, a project so ridiculously over-engineered, so expensive, so reliant on phony ridership projections and so expensive and mismanaged that it ended up raiding Fullerton’s own Capital Budget to the tune of $600,000. In the end no one knows how much was actually spent on that boondoggle when everything was said and done. But one good thing that came out of it was teaching me to appreciate how things are done in Fullerton, and how there isn’t one cent’s worth of accountability on the part of anybody.

If the Trail to Nowhere actually ever gets built but is way over budget, unused, unmaintained and falls into decrepitude, who will stand up to take responsibility? Not the City Council who approved it without question. Not City staff – the chief architects of this disaster in-waiting are already gone – nor will the City Manager, who will be gone as soon as his pension formula tops him out. None of the people stirred up to insult and harangue the City Council will be in evidence and the proprietors of the Fullerton Observer, if they are still around annoying people, will not be searching for those accountable. No one else will be, either.

Maybe the less said, the better…

Remember the multi-million dollar Poison Park intergenerational fiasco? Has anybody ever taken responsibility for that poster child of bureaucratic incompetence and political indifference? Of course not. That would be a horrible precedent. Fullerton.

Let the Victimhood Begin!

Yes, Friends, it’s that time of year again, when Fullerton’s City Council chooses one of its number to act as Mayor for the upcoming year.

Zahra-Busted
Time to come clean…..

And as predictable as the summer monsoon in Bangladesh, the Fullerton Observer has begun laying the foundation for another wailing session, decrying the mean council trio of Jung, Dunlap and Whitaker for passing over Observer inamorata, Ahmad Zahra, the preening, deceitful, egomaniac councilman from District 5, who has gone well out of his way to alienate the three, any one of whom could get him chosen Mayor.

Here’s the doleful headline:

Will District 5 Get Mayoral Representation at the City Council Meeting on December 5?

It’s sort of fun to read the litany of complaints and grievances that follow, written by somebody called Jack Hutt, whose angry essay is just another attack on Fullerton’s three more or less sensible representatives.

Mr. Hutt starts decrying the fact that a mayoral rotation policy is not being followed. Well, what a shame that is. A council not feeling bound to adhere to a policy it evidently disagrees with.

Hutt does ponder the question of the motives of Jung, Dunlap, and Whitaker, a little:

One has to wonder what happened in closed sessions that made council members Jung, Whitaker, and Dunlap publicly disrespect Zahra. Will the council members ever tell the public the reasons?” 

Good question. And yet poor Hutt doesn’t seem to realize Closed Session deliberations are cloaked in secrecy by law. It doesn’t really matter to Hutt anyhow, because in his very next sentence he telegraphs his intent:

Or is it so petty or phobic that it can not be uttered?” 

Now our offended writer has rolled three insults into one conclusion. The three are either so petty, or gay-hating, that they must cower in fear, terrified to let the public know how low they are.

Later, Hutt rolls out his big gun:

He also survived a vicious negative campaign funded by Tony Bushala.” Whenever the Observer crowd gets agitated enough they relentlessly name the object of their greatest fear and loathing: Tony Bushala. Hutt follows suit, of course, but as usual omits the fact that Zahra’s 2020 campaign was diligently manicured by him and his sycophants to omit facts like his real biography, his servitude to the marijuana dispensary cartel, his constant self promotion, and his arrest record; that the campaign against Zahra was aggressive, but honest every step of the way; that Zahra dished out over $100,000 to keep a Latino candidate from representing a Latino district. Oh, and Zahra was party to the creation of a fake Latino candidate, Tony Castro, to siphon votes away from Oscar Valadez

Comically, Hutt wraps up his essay with a shot at Nick Dunlap’s lack of interest in his job and makes a hopeful pitch for none other than…Jesus Quirk-Silva:

“...Jesus Silva, who was Gerrymandered out of District 3, now lives in District 2, and although this district is marginally Republican, it is competitive, and he would be a formidable candidate.”

The train of thought was weak but it sure was short…

Now, it wouldn’t be an Observer article without repeating an old lie heard over and over and over again. Quirk-Silva was, as we all know, gerrymandered into District 3 which gave him the opportunity for a free run at Greg Sebourn’s job in 2018 when he was still a city-wide councilman. The redistricting map done in 2022 cleaned up the previous nonsense with rational district boundaries that left Quirk-Silva with no district to run in since he was now in District 2 – and we’re all better off for that.

Here’s the truth: it takes three votes to get elected Mayor. End of story. The facts of precisely why the three councilmen don’t trust, don’t like, don’t want to choose Zahra as Mayor are evidently real. And Zahra is probably better off if the real reasons of antipathy toward him don’t come out; and if they were to emerge, I suspect Zahra is counting on the head-in-the-sand obliviousness of his fife and drum corps to ignore any cogent reasons that might be forthcoming. It’s victimhood uber alles.

The Scarcity of Public Information, Part 2

A few weeks ago I published a post detailing how someone had requested on October 12th, through a Public Records Act Request, information on environmental testing along the abandoned Union Pacific right-of-way; and how the City on October 23, in response, replied with six document files they called a “full release” and that had nothing to do with any sort of testing at all.

Well, they’ve done it again.

The trail didn’t go anywhere, but it sure was short…

Also on October 12th, the same person made a related request, specifically asking for a Phase 1 environmental report of the right-of-way. A Phase 1 environmental report surveys a property and its neighbors for historical usage in an attempt to identify potential environmental issues. On October 28th the City responded with the identical unresponsive documents as before, apparently digging a deeper hole for itself.

Whether this is sheer incompetence or just bullheaded arrogance, or a lot of both, remains to be seen.

As before, the proper response is not to share completely irrelevant and non-responsive documents, but, rather to simply state that there are no responsive documents.

The blue square ain’t good. Welcome to Trichlorethylene Alley. Please keep moving…

Why the City refuses to obey the law suggests several things. First, as mentioned above, stupid incompetence and/or arrogance. Or maybe somebody down there thinks they can stonewall a possible, even likely truth – that there never was any environmental testing done along the right-of-way, a path that lies adjacent and likely right on top of toxic contamination and on which the City tried to build a recreation trail for $2,000,000.

The Strange Tale of Johnny Lu’s Grant Deeds

Enhanced with genuine brick veneer!

By now Fullerton City Hall is aware that their partner in a boutique hotel/apartment high-rise on Santa Fe Avenue, TA Westpark LLC, is in trouble. TA Westpark Fullerton., AKA Johnny Lu has defaulted on a massive loan, previously borrowed to complete projects in Irvine.

Why is Johnny smiling?

The fallout from this embarrassment remains unknown, although there are plenty of questions that need to be answered, and sooner rather than later.

One of the questions involves the transfer of the public property ownership at the site to TA Westpark Fullerton, LLC before proper project approval, a desperate, and of course, totally unnecessary act. And the actual documents supporting ownership of the land in question need to be examined, too.

On December 22, 2022 the City sold the land at a huge discount to Lu. Check out the grant deed:

By now Craig Hostert, whose brain-child the boutique hotel was, is scratched out and TA Westpark Fullerton, LLC, a Delaware corporation, is the proud owner of the land and the transfer is signed by a “managing partner” of a whole other entity – “TA Partners.” Looks like Hosteret was bought out or walked away, abandoning his baby.

But, as they say in the infomercial, wait, there’s more. A quick check of the State of Delaware’s corporations roster doesn’t turn up any results for TA Westpark Fullerton, LLC. Hmm.

No responsive records…

And here’s something else. A few months later a new grant deed was promulgated and recorded at the County of Orange. Here, the hard to find Delaware corporation deeds the land in question over to TA Westpark Fullerton, LLC, a California corporation.

Something is odd here, and it’s not just the amateur hour handwritten changes on the original deed. Did the City sell this property to a non-existent corporate entity? If so, hasn’t some sort of fraud occurred? Why the shell game here, and could the original deed be considered invalid in retrospect?

No, I wasn’t asleep. I was praying…

We could ask these question of Dick Jones of the “I Can’t Believe It’s a Law Firm” law firm, because I doubt the City Council will make inquiries of their ace lawyer. Getting an honest answer from ol’ marble mouth? A rare and precious jewel.

Some might think this entire fiasco is going to get worse before it gets better. I’m not sure how that’s possible.

Bungled Boutique Hotel May Be In Big Trouble

Friends probably remember that FFFF has been relentlessly critical of the dubious scheme approved by our City Council to underwrite a downtown boutique hotel and uber-dense apartment project on a parking lot owned by the City and used by Metrolink commuters.

Here’s a reminder: three councilmembers Bruce Whitaker, Shana Charles and Ahmad Zahra voted to sell this property to a developer for a mere $1.4 million (less site material removal) while simultaneously time jacking up the value of the land by approving density 2.5 times the limit specified in the Transportation Center Specific Plan. It was a gift of public funds at least ten million dollars.

Here’s the fun part. The original and completely unqualified baby daddy of the project, Craig Hostert, didn’t have the wherewithal to make the deal. After years of failing to perform on his Exclusive Negotiating Agreement and numerous extensions, Hostert’s West Park Investments, LLC joined its non-existent forces with TA Partners Development of Irvine, Johnny Lu, proprietor.

Mr. Lu, the new face of the project, appeared at council meetings to seal the deal with a ration of gobbledygook bullshit.

Now it appears that Mr. Lu may not have been the best choice of partner according to the Real Deal Real Estate News.

Why is Johnny smiling?

It seems that Johnny has gotten himself in over his head on two projects in Irvine, including second bridge loans that he has now defaulted on. And of course Sunayana Thomas, Fullerton’s crack “business development” director seemingly failed to inform the City Council of Mr. Lu’s impending financial embarrassment, something that should have been revealed in even a cursory perusal of TA Partners’ asset to debt ratio and its balance sheet.

And then, of course there is the problem with the completely incompetent concept of rushing the approval to transfer of title to the land, before the deal had received final approval.

By now the Council has possibly, though not necessarily been informed by the Fullerton City Manager, Eric Leavitt, of the problem, but where does the deal stand? Title to the property has been transferred from the City to and through Lu’s companies*, presumably for the original sale amount. But if TA Partners can’t perform, will the City get its now very valuable property back, or will it be encumbered by bankruptcy receivers? Will the City, in order to save face as it always has, permit Mr. Lu to assign his rights and interests to another party as a face-saving strategy? If that happens, will the original bad idea still go forward, or will the Council approve something even worse as a sop to a new developer so to avoid admitting their horrible mistake in the first place?

You can try asking Whitaker, Charles, or Zahra, the architects of this inexcusable and completely avoidable mess, but don’t hold your breath waiting for a response.

* Topic of future post

Part II: Is the “Trail to Nowhere” Poisoned?

It could be. Last post I described how the the UP Park was contaminated and shut down for remediation just after $2 million were sunk into building a park. Nobody in the City bothered to do an Environmental Analysis.

I asked, rhetorically, whether the rest of the long UP right-of-way had been subsequently tested for toxins in light of the fact that trichloroethylene (TCE) had been detected on the property at 311 South Highland Avenue, a property adjacent to the proposed Trail to Nowhere. It seems that some years ago the Hughes Corporation used the solvent to clean up the circuit boards they made at this location, and the EPA still regards it as an active site.

A trail runs through it…

A little digging uncovered the fact that ground zero seems to be the west end of the property where testing has been periodically done in the area of a likely dump site for the nasty TCE toxin. Apparently there are several monitoring wells located in the yellow areas circled in red in the image below.

Please note the proximity to the Trail to Nowhere of the wells in the lower left. 15 feet? 10 feet? 5ft? Surely somebody in the Parks or Engineering Departments gave thought to this when the Trail to Nowhere concept was developed; when the grant application was made; even when the proposed project budget was laid out. No? If not, why not? How could they not have known? The EPA has recognized this as a site of TCE ground water contamination where a toxic plume is heading southward – under the proposed trail.

At this point questions are starting to pile up. Questions that may have uncomfortable answers.

We are fortunate that Messrs. Dunlap, Jung and Whitaker have put the kibosh on the silly and wasteful Trail to Nowhere proposal for other common sensical reasons. And yet there remains the problem about lack of disclosure to our elected officials in their decision making process, and perhaps even in the grant application itself.

The Mantra of Economic Development

No news is good news…

A Friend just forwarded an article in the Yellowing Fullerton Observer about the City’s latest foray into something called economic development – an effort to create more tax revenue, somewhere, somehow, sometime. The good folk in City Hall are alarmed at the looming budget deficit they forecast in the next few years. And they know full well that another attempt at a sales tax like the ill-fated Measure S promoted by Ahmad Zahra and Jesus Quirk-Silva would be a shaky proposition.

According to the Observer the City hired an entity called Kosmont Companies to assay Fullerton’s future and determine where tax generating opportunities may lay. At the June 20th meeting of the City Council a report by Kosmont was submitted for general perusal.

Exhausting all options…

I note that Kosmont Companies is an operation whose sole raison d’etre these days is to work for Redevelopment Successor agencies and municipalities trying to gin up revenue to support the bureaucratic establishment. According to the staff report Kosmont was employed by “the City” in February 2023; since no agenda report exists for this contract, it must have been executed out of the public eye by our esteemed City Manager, Eric Levitt. I’ll address the report itself and the Council’s reaction in another post.

I often wonder why anybody thinks local government have any business promoting these types of endeavors. Government employees know little about business operations, nothing about the concept enterprise; they know defined benefit pensions, their union agreements and petty, make-work bureaucratic stuff. These same chuckleheads just up-zoned and entitled a massive apartment project on land they sold to the developer for 10% of its new value. As far as the unknown amount paid to the “consultant” I wonder if even that expense will be recouped by their own work product.

Just as bad, the economic development concept is created and run, for and by, the same people who stand to benefit from it – it it were to even work at all. And of course there is never any accountability for public resources expended in the pursuit of this talisman.

A Massive Gift of Public Money

In December, as the Friends will remember, the City of Fullerton sold a public parking lot to a so-called developer for $1,400,000. The “developer” had the task of building a boutique hotel and an apartment block. FFFF has already documented the ridiculous density the City has bestowed upon the project. So let’s revisit the topic of land value, a calculation based on the number of residential units a developer can cram onto a parcel of land.

Look, it even has the café the bureaucrats demanded!

In this case we know precisely how many units are proposed because the development agreement tells us. There are going to be 141 apartment units and 118 hotel rooms – rooms that will undoubtedly be converted to low income housing when the hotel concept fails. Dividing 259 units by $1.4 million gives us $5400 per “door” as they say in the biz.

Does that number seem low? I didn’t really know, so I contacted some pros at Land Advisors who informed me that a more typical number is in the range of $60,000 to $65,000 per unit in these parts, which produces a land value of about $15.5 million and above.

So the “economic development” geniuses in City Hall got the City Council to agree to a massive reduction in value for the sale of the land, a reduction that could be in the neighborhood of $14,000,000.

Now we all know that government and its agents shield themselves (or try very hard to) from accountability for this type of incredible giveaway. It’s not a crime to be stupid, and so there the issue of legal malfeasance can be fuzzy without proof of corruption. But here there is the issue of misfeasance that in this case justifies the initiation of a recall of the elected representatives who voted for this evident gift of public funds.

Mother’s milk…

And those three representatives are Ahmad Zahra, Shana Charles and Bruce Whitaker.

Now, undoubtedly, these three politicos would argue that they had great reasons for “subsidizing” this boondoggle, and that those excellent reasons are well-worth the $14,000,000 they happily pitched at the developer, an individual, we must remember, who brought this unsolicited proposal to the City. But the City, remember, never did its due diligence by opening up this concept (or any other) for a submission of qualifications by those who might have been interested. No. Not even after several years had gone by and the proposer had been granted several extensions of a Exclusive Negotiating Agreement and the proposal kept metastasizing.

Are a “boutique” hotel at the train tracks and yet another overbearing apartment block so important that they justify the $14,000,000 giveaway? Well, I would challenge Charles, Whitaker and Zahra to prove it to voters in their districts.