Special Council Meetings Tonight

The Claremont City Council will hold not one but two special meetings this evening in the council chambers at 225 W. Second St. We didn't see tonight's sessions listed on the council's streaming video site, so you'll probably not be able to watch the proceedings on your computer.

[UPDATED 4:25PM: The link to streaming video for tonight's 6:30 workshop is now up; it will be available anytime to view and review]

The first matter is a closed session meeting at 5:00pm to discuss ongoing employee contract negotiations. The other item for consideration during the closed session is an unspecified matter involving "anticipated litigation." You can read the closed session agenda here.

At 6:30pm, the council will hold a special workshop to review the report from the Mayor's Ad Hoc Committee on Economic Sustainability. Here's the workshop agenda, and, in case you missed it, here's the committee's report:

Mailbag

We received this note in response to our post from a couple days ago regarding the Claremont Police Officers Association and their preparations for contract negotiations with the City (to be filed under "Prepping the Battlefield"):

DATE: Wed, February 16, 2011 1:26:41 PM
SUBJECT: "crime scenes"
TO: Claremont Buzz

Really smart post -- nice work connecting the dots, and a pleasure to see. I like Dieter Dammeier, and think highly of Claremont cops, and still thought you righteously nailed them to the wall on this one.

Yes, it's unfortunate that the CPD officers give residents the false choice of having to either support their contract demands or else fear for their collective safety. We don't doubt that our police work hard for their money, but let's face it, a Claremont officer doesn't face nearly the same daily challenges as, say, an officer working the LAPD's South Bureau. The CPOA needs to set aside its own selfish interests and start thinking about what sacrifices they can make rather than insisting that everyone else - their fellow non-safety employees, people who count on services provided by the City, and cash-strapped taxpayers - pay for the CPOA's every demand.

Driven by an Inland Empire unemployment rate of 13.9%, public sentiment is lurching away from support for the CPD officers refusal to pay their share of their CalPERS pension plans. Witness the Daily Bulletin's editorial on just this subject. The Bulletin noted that Claremont's Ad Hoc Committee on Economic Sustainability came to the conclusion that the status quo for the City's budget is no longer viable.

That committee report, which was released last week, recommended a 1.5% hike in the City's Utility Users Tax, from the present 5.5% to 7%. The report also called for all city employees, including police officers, to start picking up their share of the costs of their pensions. The Bulletin agreed that the employees need to pay their fair pension shares, but they disagreed with the committee's proposal to increase the utility tax:

We admire the committee's thoroughness, looking at all sorts of possible tax and fee hikes before settling on the utility users tax as the most feasible and effective. But we do not favor raising the tax in this economic climate, nor did the three council candidates we have endorsed - Sam Pedroza, Opanyi Nasiali and Jay Pocock. We doubt that voters would approve the hike.

Nasiali, one of nine members of the economic sustainability committee, was the only one to oppose any utility tax hike. He was one of two who wanted employees to pay their own share of pension costs as quickly as possible, rather than phasing the change in over four years as the majority favored. (The employee share for public safety employees is 9percent of salary, for other employees 8percent.)

Requiring employees to pay their share ASAP - or perhaps, to reduce the discomfort somewhat by requiring them to pay 4percent in 2012-13 and the full amount from the next year on - is a reasonable course of action. (Glendora has imposed such a change on its employees; Claremont sanitation workers have already agreed to pay their own full amount.)

Government agencies started picking up employees' share of pension obligations as well as paying their own employer share when times were good - but times are no longer good and, besides, such largesse never was sustainable in the long term. Better for employees to pay that share than for mounting pension costs to require more and more layoffs and reductions in service over the years.

There are two items worth noting here. First, according to the Bulletin, incumbent Sam Pedroza is opposed to a utility tax hike. So it seems unfair and hypocritical to us that Pedroza supporters, some of whom are working behind the scenes to elect a slate consisting of Pedroza, Robin Haulman, and Joseph Lyons, are lambasting Nasiali and Pocock for being similarly opposed to raising the utility tax. Second, the same Pedroza-Haulman-Lyons supporters are spreading false rumors that Nasiali wants take away employee pensions. As the Bulletin piece stated, Nasiali is simply advocating that employees pick up the eight- or nine-percent that they are supposed to be paying in the first place. And, by the way, the city would continue to pick up its share of the employee pension payments.

So any talk of a wholesale elimination of the pensions is a lie, and we urge readers to get the name of any campaign volunteer who makes such statements, along with the name of the candidate they're working for. Better yet, ask for them to commit such statements to paper or to a recording, and forward those to us for a future post.

With election day only a few weeks away, the gloves are coming off those Claremont 400 fists, and it's up to the rest of us to hold them accountable for their silly games.

Commissoners Nix 7-Eleven

To Claremont fans of extruded frozen beverages: Sorry, no Slurpees for you.

In case you didn't hear, the Claremont Planning Commission said no to a conditional use permit application for the proposed 7-Eleven that would have gone into the empty commercial building at the northeast corner of Foothill Blvd. and Mills Ave.

Daily Bulletin reporter Wes Woods II tells us that over 20 residents turned out to last Tuesday night's Planning Commission meeting to voice their objections to the 24-hour convenience store. Woods' article also said that city staff found that local cities typically receive between $12,000 to $21,000 in annual sales tax revenue from a 7-Eleven location.

Planning commissioners vote 6-1 against the CUP application. Woods quoted several commissioners who explained the reasoning behind their votes:

Commissioner K.M. Williamson, before her no vote, said, "this is a tough site. A lot of attention needs to be paid to that fit." She said she took into account residents' concerns about alcohol sales, the 24-hour opening and, "to a lesser degree," the convenience store.

Commissioner Cynthia Humes voted for 7-Eleven because she felt the business met all of the conditions for the permits.

"The homeowners association has done a good job in turning people out," Humes said. She said if the intersection where the 7-Eleven was to be located is unsafe in terms of traffic, "let's fix it."

Commissioner Jeff Hammill said one of the letters he received was against the project because it would bring people who drink alcohol, eat junk food and smoke cigarettes.

The applicants can still appeal the matter to the City Council. However, given the outcry against the 7-Eleven, it would be difficult to see the council overturning the planning commission's decision.

Local Accountability

TIGHT MONEY

With the city of Claremont and the Claremont Unified School District both facing even more budget cutting, both agencies are reaching out to the community for help in solving their money problems. Although the City and the CUSD are pursuing similar strategies, their goals are very different.


DESPERATELY SEEKING OPINIONS

The City seems to have moved on a little from its Glenn Southard days and is actually trying to solicit real opinions that it will try to incorporate into its decisions. Claremont held the first of two community budget workshops last week, and the second is scheduled for tomorrow night, February 16, from 7-9pm in the Padua Room of the Alexander Hughes Community Center at 1700 Danbury Rd.

The City has also posted its Powerpoint budget presentation along with an online survey that will be used to determine budgetary priorities. The survey needs to be completed before Monday, February 22, if you want your responses to be included in the budget discussion.

Tony Krickl reported on last week's budget workshop in Saturday's Claremont Courier (sorry, no link available):

Residents were asked to provide their opinions on the most deserving programs and projects for the city's revenues. Some of the top priorities identified at the meeting include fiscal responsibility, public safety, high building standards and sustainability.

But city officials warn big expense projects on the scale of Padua Park are likely off the table in the near future. "We don't have a lot of extra money lying around to do big capital projects," City Manager Jeff Parker said.

The article also indicated that city officials were surprised by the severity of the recession, and had to deal with a General Fund (the portion of the budget that is funded by things like sales and property taxes) that in the past year was reduced from $22 million to $20 million. In addition, as you probably know, the city has had to cut back on services and reduce the number of employees by almost 15 percent.

City Manager Parker also said in the Courier article that the City could lose between $50,000 and $100,000 in sale tax revenue if Claremont Toyota's sales suffer from any backlash to Toyota's problems with accelerator and brake controls on many of its models.

The biggest surprise to us is that city officials didn't foresee any of these financial problems and went ahead with a number of costly projects. For example, the City spent about $2.6 million building the aforementioned scaled-down version of Padua Park, and borrowed $527,000 from its General Fund reserve in the process. That one project therefore accounted for virtually all of the city's budgetary problems. You would have thought the responsible thing would have been to wait until the economy and the city's finances improved before proceeding with such a large capital outlay. The City was really no different than a family that decides to go ahead with remodeling their kitchen right before their income is reduced by half because of a job loss. Yes, they couldn't foresee the problem, but still, they have to reduce spending when it happens.

Claremont is certainly in much better shape than some cities, but it's still accountable for having created its own problems at the cost of the very municipal jobs and services it holds so dear.


CUSD BOMBS OUT

As we predicted last week, rather than a self-examination of how it managed to misspend $48.9 million in Measure Y bond money, Claremont Unified is gearing up for a revenue enhancement campaign by laying a guilt trip on taxpayers. CUSD board president Hilary LaConte was quoted in Saturday's Courier on this point (again, no link):

"I think one of the questions that will come out of this is that what does the community really value in education our children?" Ms. LaConte said. "Many other districts are turning to their communities for help and we are doing the same. We really want to get a sense of where the community lies before we go forward."

In other words, if Claremonters don't want a bond (CUSD's funding vehicle of choice), they don't value their children's education.

To help CUSD determine the level of public support for either a bond or a parcel tax, the district hired TBWB Public Finance Strategies, LLC, to poll residents. The problem with that consultant, in our view, is that this is not like hiring the Gallup Poll. Polling is not their single area of expertise. Rather, TBWB advertises itself as being expert at getting financing measures passed. They are more of a campaign consultant than a pure polling company, and CUSD hired them in 2000 to help get Measure Y passed.

This all leads us to believe that the real purpose behind CUSD's bringing in TBWB is not to seek public opinion but to determine the best ways of marketing a future bond or tax to voters. The polling results will be used by the district to shape its future financing election campaign. The CUSD board (with the exception of boardmember Steve Llanusa) has almost certainly already decided what it wants and couldn't care less about what we the public believes is important.

Unlike the City's public opinion survey and community budget meetings, CUSD (which remains the Claremont 400's playground), already knows what it will do. The rest, community meetings, polls, Claremont Courier puff pieces, is simply window dressing.

Fiscal accountability has come up very little or not at all in the discussions. Worse, if we end up with a bond measure, none of that money will go towards hiring a single new teacher or underwriting existing salaries and benefits. A bond will only be used for new construction, remodeling, and upgrades of existing facilities - something that we did only 10 years ago with Measure Y. And, incidentally, we are still paying off Measure Y today (check your property tax bill for last year).

Really, when you think about it, CUSD's board is a kind of neutron bomb of public agencies, keeping all the buildings standing but eliminating people. They're really concerned with having the newest goo gaw rather than investing in hiring and keeping good teachers. We understand that California's school districts have been hit very hard - harder than most cities - by the state's never-ending budget deficits, but CUSD and almost all of its boardmembers, current and past, have thrown away millions over the years and will do so again if given the chance. They must be held accountable first, then we can talk about finances.

Farewell, CMA

TOUGH TIMES

We were sorry to see the Claremont Museum of Art close its doors at the end of December. We liked the idea of a museum to showcase local artists and hoped it would make a go of it.

The museum had the misfortune of opening just before the economy tanked, and that certainly contributed to its demise. It also may have suffered from too small an audience. We'd always wondered how they'd be able to support itself when its core audience came from a town of only 35,000 people. CMA didn't seem to have much wide appeal outside Claremont. For example, a December, 2008, fundraising dinner in Pasadena ended up costing more than it brought in.

When it was still a going concern, the museum did make a splash with a $10 million gift from an anonymous donor. The donor, however, attached some conditions to the gift, and the museum wasn't able to use the money for its $900,000 annual operational budget. In the end, the donor pulled the $10 million, and the museum's fundraising efforts fizzled.

Facing closure, the CMA came to the City for money last September. They asked city staff for $4,500, and staff dutifully complied by giving the museum the money without a public hearing. That money helped keep the museum open until the end of October, when the CMA again had to go hat in hand to the City for a second cash infusion of $5,721, again without public input.

During that period, the museum made some changes that included expanding its board to include former Claremont mayors Sandy Baldonado and Ellen Taylor (the kiss of fiscal death, if the CMA had really thought about it). We interpret the inclusion of these two as a sign that the 400 had taken up the museum's cause, which made sense because some of the biggest donors came from the 400. In any case, the museum also closed its store, cut back its hours, and laid off all except one employee.

Former Mayor Ellen Taylor
blowing hard
ONCE MORE TO THE WELL

None of the museum's changes made any difference, and by November, the museum had to come before the City Council for $18,879 from the City's Public Art Fund to keep it going until the end of December. The city staff report from the 400's ever-reliable Mercy Santoro gives the background.

At a meeting on November 11th, the City Council heard a pitch from the museum. Among the pitchmen was none other than former Mayor Taylor, who, with her typical Ellen eloquence, explained how the museum go in such dire straits: "...things came [up] and just kicked us in the goddamned butt. [at around 3:17:00 of the meeting video]"

As we might expect, Councilmember Pedroza and Mayor Pro Tem Elderkin were the most sympathetic to Taylor's message from the Claremont 400 that we really need this museum (and you better support it). In her comments, Taylor kept using the 400's buzzword "vision," implying that that anyone who voted against the City donating the money was blind to what was best for the City. In other words, you're either with us, or you're a bad person.

Taylor's words also carried the implicit threat that any councilmember heartless enough to vote against giving the money would be done as a local politician. It's the 400's polite way of strongarming people (or The People) to get money they think they need: Why exactly do you hate the museum? Other societies might call this extortion.

Councilmember Peter Yao was really the lone voice of reason, pointing out first that he was concerned about what might be construed as a gift of public money, which would have been an illegal action. Yao further pointed out that because the City had essentially provided the museum with 100% of its working budget, it had a duty to question how effectively its money would be used. After all, Yao asked, what good would it do to give the museum the city funds if it was just going to delay an inevitable failure?

Another question Yao posed was to asked what plan the museum had to raise the $200,000 they were aiming for to fund its 2010 budget. None of the museum representatives could answer that, other than to say that they had formed a working group to work on a plan to develop a plan for fundraising. In other words, they had no real plan.

The discussion included other absurdities. Among these was the idea, raised by Pedroza and Elderkin, that the museum store was a moneymaker. Despite comments from a museum representative that the store had been "hemorrhaging money," Elderkin, assured as ever of certain certainties, wanted the museum to reopen the store. Elderkin also expressed absolute certitude in the museum's fundraising team, which surely portends greater fiscal problems for the City if, as expected, Elderkin takes her turn as mayor in March.

Still, in the end, the council bowed to the pressure and voted unanimously to give CMA its $18,879 (we never did figure out what changed Councilmember Yao's mind). The museum had its money and went off merrily to find the $200,000 they were sure was waiting for them. Unfortunately a final fundraiser managed to raise only $26,000 in pledges, and on December 27th, the museum shut down.


SONG REMAINS THE SAME

You'd think the 400 would have learned at least a little financial sense from the Claremont Trolley experience. If you'll recall, the City found it cheaper to put the trolley into storage and eat the lease payments rather than continue to fund its three-year $889,000 budget.

Yet, despite all evidence to the contrary and lacking any specific data, the 400, through its mouthpieces, trotted some of the same arguments for the museum that it used in its failed attempt to keep the trolley going: it brings economic benefit to the city; it just needs a few more months to really get going; we just need to make a few changes to turn it around.

Well, they got their way, and the museum closed anyway. In the process, the city frittered away nearly $30,000 at a time when Claremont is having to lay off employees and cut their benefits, reduce services, and raise fees in order to address a $2 million dollar budget deficit for the current fiscal year. As Councimember Yao pointed out, one can be supporter of the museum on the personal level, but one should not turn that personal view into a public one at the cost of vital taxpayer dollars.

With the 400, though, rationality has limits, and Yao's arguments fell on deaf ears. The nearly $30,000 Claremont doled out to the museum may be chump change to city staff, but the city's deficit is really as much the result of the accumulation of decades of these stupid little financial decisions as it is a matter of the current recession.

Our suggestion to future councils is to just say "No" the next time the 400 comes calling, no matter how painful that may be. A little tough love might be good for them and for the city in the long run.

The Budget Results Are In

At last Saturday's city budget meeting, the Claremont City Council approved a $2.32 million budget makeover, the Daily Bulletin reported. The changes were need to help the City deal with what the city was saying was going to be a $2.69 million shortfall in Fiscal Year 2009-10. This comes on the heels of a $1.5 million deficit for FY 2008-09.

That's total shortfall of $4.19 million through July 31, 2010, and it could have been worse. Luckily for Claremont, the state of California didn't touch local transportation funds when state legislators and Governor agreed the budget compromise last week, otherwise the hit for local governments would have been $1 billion worse. As it is, because our leaders can agree to a permanent fix to the budget process, our state leaders will probably be having another budget showdown in a few months. The Sacramento Bee's Dan Walters is calling it our state's five-month budget cycle.

So, Claremont's budget solution may not represent a real fix at all, and that 2009-10 deficit could still grow, depending on how the economy performs and what future revenues the state tries to take.

The cuts the City Council approved last Saturday include "golden handshakes" to encourage employees to take early retirement, raising fees for some city programs, and increases in parking ticket fees. The City will also have to workout an agreement with employee associations for either a 38-hour work week or a four-day work week. This will amount to a 5% pay cut for most employees. The City is also likely to eliminate some positions entirely.

The Bulletin article reported that Councilmember Peter Yao was the sole vote against the measure:

Councilman Peter Yao voted against the proposed changes. His objections were the cost of the Public Employees Retirement System "Golden Handshake" retirement package, where an employee receives two years of PERS service credit, and a larger police department budget in 2009-10 than in 2000-01, despite a similar budget projection.

"I can't honestly support it," Yao said, adding he felt the proposal was a temporary and not permanent fix.

* * * * *

The council also meets tonight for their last meeting before their August break. The city website was down for much of today, or we'd offer you a breakdown of some of the issues. Try checking out the city's website yourself at www.ci.claremont.ca.us.

Some interesting items on tonight's agenda:

• The College Ave. affordable housing project.
• The official city flower (staff says, "Sticky-leafed Monkeyflower").
• Expansion of the Oak Park Cemetery.
• Renaming the 100 block of East 11th St. The new name would be "Drucker Way." This is being proposed by the Claremont Graduate University.
• The City's investment report for FY 2008-09 (not all financial news is bad, it seems).
• City commission appointments and reappointments (some surprises here, including Butch Henderson, who landed a spot on the Human Services Commission).
  

The council meeting begins at 6:30pm in the City Council Chambers at 225 W. 2nd St. in the Claremont Village.

City Council Meeting Tonight

The City Council meet tonight in the council chambers at 225 W. 2nd St. You can watch it all here.

The council will meet in closed session at 5:15pm to discuss possible future litigation in two unspecified cases. The council will also hear a report from City Manager Jeff Parker and Assistant City Manager on labor negotiations with the City's employee organizations.

The regular session begins at 6:30pm. We don't have time for an in-depth breakdown, but you can read the regular session agenda here. The specific reports for each agenda item are here.

A few items of interest from tonight's agenda:

• Discussion of parking standards for Institutional Districts (i.e., the Claremont Colleges).
  
  
• The new water conservation ordinance.
  
  
• Consideration of a proposed traffic signal at Indian Hill Blvd. and 10th St. (in response to the pedestrian accident there).
  
  
• An economic development report for Fiscal Year 2008-09.
  
  Some grim news here, as might be expected. Claremont's projections for the city's share of sales tax revenues in FY 2009-10 are down about $1.9 million or 38.7 percent, and it's been difficult to attract news businesses in this recession. And when you look at real numbers - total 2008 sales tax generated in Claremont versus 2007 - that number was off 49 percent. All of that loss seemed to come from auto sales and transportation, which underscores Claremont's long over-reliance on the Claremont Auto Center's sales.
  

Sacramento Report

Wikimedia image
The state's budget impasse continued over the 4th of July weekend. California, as you have heard, has begun issuing registered warrants, or IOU's, because the state legislature and Governor Schwarzenegger have been unable to reach an agreement on how to bridge the budget gap. The IOUs began going out after the 2008-09 Fiscal Year ended on June 30.

Local governments, including the City of Claremont and the Claremont Unified School District, will just have to wait to see how much of a hit they're going to take once all the dust settles. Incidentally, while the bickering in Sacramento dragged on last week, the state's budget deficit rose by a couple billion dollars, from $24.3 billion to $26.3 billion. Hey, guys and gals, you're going the wrong way!

And some of our fearless leaders aren't going anywhere, right way or wrong way. State Assembly Speaker Karen Bass (D-Los Angeles) yesterday boycotted a meeting of the "Big 5" (the heads of both parties in the State Assembly and State Senate, plus the Governor). According to the Sacramento Bee, Bass is complaining that the Governor is pushing things unrelated to the budget crises (things like permanent fixes to avoid this situation in the future):

The Republican governor and legislative leaders are still discussing various permanent changes to state health and welfare programs that would tighten eligibility and Schwarzenegger believes would combat waste and fraud.

Democrats and labor unions insist that the governor is overstating the extent to which the state can save money from such changes, such as fingerprinting In-Home Supportive Services recipients and providers. But Schwarzenegger believes that such changes can bring in real cash, as much as $400 million to $500 million in IHSS alone -- and $2 billion in 2009-10 for all of his various changes to state programs.

Bass boycotted this morning's meeting on grounds that Schwarzenegger is demanding these changes in exchange for agreeing to fewer cuts. She said these reforms are "unrelated" to the $26.3 billion deficit and that leaders should instead work on other solutions that would bridge that gap, with a promise to consider the permanent program reforms later. She also warned she may not attend the afternoon Big 5 meeting.

Bass' concern about any cuts in health services is understandable. Groups like the Service Employees International Union are some of the biggest donors to Democratic candidates, and any reduction in state health spending means fewer SEIU members. So Bass' willingness to tolerate a little waste and fraud makes sense when you see where her money comes from (what's a few billion between friends?). Hence the bait-and-switch: let's just patch things over and work out a real fix at some indefinite future time. Bass (and a good number of Republicans as well) doesn't want to admit that the budgetary landscape has shifted dramatically and that yesterday's political games are so, well, yesterday.

Meanwhile, as the debacle drags on, Fitch Ratings has cut California's long-term bond rating from A- to BBB. As a result, Californians will have to pay much more in interest in order to float bonds for things like big public works projects. The SacBee tells us how much more:

State Treasurer Bill Lockyer last week warned that a rating downgrade to BBB+ -- one grade higher than California's new BBB -- could result in an estimated $7.5 billion in interest costs over a 30-year period. California last had a BBB rating between December 2003 and September 2004, when the state grappled with a significant budget deficit.

Lockyer spokesman Tom Dresslar said that California will pay higher costs the next time it tries to borrow money for public works projects. He said he the state could be saddled with a lower credit rating for some time.

"The last time we got downgraded in this type of environment when we issued IOUs, it took years to recover," Dresslar said. "So even when we adopt a budget solution, our rating probably won't go up magically overnight."

The New York Times Magazine last Saturday surveyed the contenders for California's 2010 gubernatorial election, and the budget impasse formed the backdrop to the piece, which was titled, "Who Can Possibly Govern California?" The NYT Magazine piece described what Californians already know to be the root of the problem:

Passing a budget or increasing revenues in California is dicey in the best of times. The state constitution requires that two-thirds of the Legislature agree on a budget or higher taxes — the kind of overwhelming political consensus, in other words, usually reserved for amendments to the federal Constitution. (California is one of just a handful states that require a two-thirds vote to pass a budget.)

Complicating matters further, the major parties in California are both effectively controlled by their most partisan elements, a byproduct of gerrymandered voting districts that force lawmakers to appeal to their ideological bases. After many earlier failed efforts, a ballot initiative championed by Schwarzenegger finally passed last year that will redraw the districts. But that won’t take effect until after the 2010 census, so for now the two parties are largely controlled by what Bruce Cain at Berkeley calls “the Taliban.” The result? Gridlock in Sacramento, a standoff between the parties of “no more taxes” (Republicans) and “no more cuts” (Democrats).

The Taliban! You have to love that truth of the term and its emphasis on the blame both parties and the interests that back them share for this mess.

Cities at the Fiscal Brink

A year ago, facing falling revenues and saddled with overly generous employee pension obligations, the city of Vallejo declared bankruptcy. As we suggested at the time, other California towns are being dragged down by the same set of problems.

Vallejo (and potentially other local governments) sought bankruptcy to restructure its employee contracts, which included pension obligations the city can no longer afford. The state Assembly, however, responded to the possible coming wave of municipal bankruptcies by proposing legislation pushed by public employee unions that would require local governments to obtain the state's approval for bankruptcy filings.

The municipal bankruptcy bill (AB 155) is sponsored by Tony Mendoza (D-Artesia). Local governments and their representatives have lined up against the bill, according to a Sacramento Bee article published today.

The Bee article observes that the recession has pushed more local governments to the brink of bankruptcy, and some of those same agencies have apparently been using the fiscal crises as bargaining chips with their employees' labor representatives. The article says:

The fiscal crisis "raised alarm bells," said Carroll Wills, spokesman for the California Professional Firefighters.

"Municipalities up and down the state have either spoken publicly about bankruptcy or have contacted the bankruptcy attorney representative for Vallejo," Wills said.

But the issue goes well beyond Vallejo, he said.

"There's a central issue of the sanctity of the negotiated (labor) contract at stake," he said.

"Some of our local affiliates have been given this back-channel nudge (from management): 'If you guys don't respond (and make contract concessions), we're going to pull a Vallejo,' " Wills said.

One More Sign of the Times: Layoffs at CMC

An article in the Daily Bulletin noted that the Claremont McKenna College is eliminating 11 administrative positions by the end of June as a cost-cutting measure. Three of the positions were vacant, so that means that eight people were handed pink slips.

The cuts come in response to a significant drop in CMC's endowment, according to Richard Rodner, CMC's associate vice president for public affairs. Rodner did not disclose the exact amount of the cuts CMC needed to make to balance its books, but he did note that the college had already slashed $1.5 million from its operating budget through faculty and staff early retirements.

The Bulletin article, by Wes Woods II, quoted Rodner on the cuts:

"It's important to know we haven't done this lightly and we've certainly have looked at the process of making certain that our core mission is maintained," he said. "We focused efforts on minimizing the level of tuition increases, supporting financial aid and meeting every student's needs."

"When I say financial aid, we don't do loans. It's not financial loans. What I said was we will continue to support the financial aid program, and meet 100 percent of financial need without any packaged loans.

He said it was "private information" on who these people are who were laid off.

"As far as we know, we are not planning anything further in the near future," Rodner said. "We sincerely hope we don't have to go through this again. Economic circumstance dictates how to evaluate circumstances in the future."

The article also said that CMC was facing a deficit of between $10-12 million by 2012-2013.

City Council Meeting Tonight

Claremont's City Council meets tonight, beginning at 5:15pm in the Council Chambers at 225 Second St. in the Claremont Village.

CLOSED SESSION - PHANTOM PARCELS

The meeting begins with a special closed session meeting for the council to hear City Manager Jeff Parker report on negotiations with Golden State Water Co. on the purchase of a parcel of land from the water company, apparently for affordable housing. Here's the closed session agenda.

Parker will also report in the closed session on negotiations with Jamboree Housing, the company that wants to build the proposed affordable housing project at the old Claremont Courier site at 111 S. College Ave., across from the Pooch Park. You can read more about the proposal on the city's website.

One odd thing about the way the city s touting the proposal - the city's Affordable Housing Task Force employed the VERY same arguments made by the people who opposed failed Base Line Rd. project last year. Recall that those folks suggested a couple downtown locations as alternatives superior to the Base Line Rd. site.

We quote from the city's information for the current proposal:

This site was recommended as the top site in the City for the development of affordable housing by the Affordable Housing Task Force that was appointed by the City Council in Spring 2008. This recommendation was based on the site's close proximity to transit, parks, schools, and other services in the downtown.

[Emphasis added - ed.]

If you stick around long enough, you'll notice that two groups can make precisely the same suggestions to the City, but where one will be ignored and dismissed, the other will be lauded for thinking creatively - about the same idea!

* * * * *

In tonight's closed session meeting, the two agenda items concern two particular parcels of land: the water company parcel (L.A. County parcel number 8312-022-800, according to the agenda) and the old Courier property (parcel number 8312-022-001).

We tried looking both those up on the L.A. County Assessor's website, but it kept telling us those parcel numbers do not exist:

Click to Enlarge

We don't have time to run this to ground, but doesn't the city at least have a problem with the public notice of the phantom parcel negotiations? Just wondering....

Click to Enlarge

REGULAR SESSION

The council meeting continues at 6:30pm with a report on the closed session, followed by the council's regular meeting. You read the regular agenda here or watch it streamed live tonight here.

Among the regular session items up for review and discussion are:

• A report from City Treasurer Adam Pirrie on the state of the City's investments, which were off by $1,556,831 for the first quarter of 2009. The investments, totaling $18,769,480 as of March 31, 2009, are supposed to be in pretty conservative instruments. You'll recall that as a backlash to the city's investment of over $5 million in the defunct Orange County Investment Pool in the early 1990s, the City has tried to keep things mostly in safe CDs and cash accounts.
  
  The Claremont Redevelopment Agency's investments also lost money, the treasurer's report says. The CRA had a total of $2,128,190 in investments as of March 31, and that was down $739,144. Just as with the City's investments, the report attributes that CRA investment decline to having to pay for CRA's operational expenditures.
  
  So why the decrease? According to Pirrie's report, the city has been spending the money on operations because revenues have been decreasing. They're dipping into savings to cover the costs of services.
  
  More on this item later.
  
  
  
• Current economic conditions have the City scrambling for revenue, which means we should look for fees to increase anywhere and everywhere city staff can possibly find a buck.
  
  To this end, staff proposes that the council approve some changes to its film production permit process to allow for inflation-indexed increases in current permit charges. Staff also wants the council to add commercial still photography to the list of activities covered by the film production permits.
  
  Here's the staff report for the matter.
  
  
  
• The council will also consider the recommendation of its Ad Hoc Commission Sub-committee (Councilmembers Linda Elderkin and Larry Schroeder) to appoint Jeff Camacho to the Community Services Commission.
  
  A side note: This commission seat seems to be the ticket to the City Council. Both Schroeder and Councilmember Sam Pedroza served on this commission before being elected to council.

Life Imitating Art

If you wanna buy you a home or a farm,
That can't deal nobody harm,
Or take your vacation by the mountains or the sea.
Don't swap your old cow for a car,

You better stay right where you are,
You better take this little tip from me.
'Cause I look through the want ads every day
And the headlines on the papers always say:

If you ain't got that do re mi, boys,
If you ain't got the do re mi,
Oh, you better go back to beautiful Texas,
Oklahoma, Georgia, Kansas, Tennessee.

California is a garden of Eden,
It's a paradise to live in or see;
But believe it or not, you won't find it so hot
If you ain't got the do re mi.

Do Re Mi
Woody Guthrie

Sure, we were joking last week about a reverse Dust Bowl migration out of California for Oklahoma and other Midwest destinations. But comes now the news in the San Bernardino Sun about the bad economy pushing people out of the Golden State:

California's population continues to grow, but in recent years, more people have left the state than moved in from other states.

What remains to be seen is whether California has reached a point where financial opportunity itself has fled eastward or whether the state is experiencing a short-term trend.

The Sun article goes on to say that this net outflow (not including legal and illegal immigration from other countries) preceded the current recession by a few years:

California Department of Finance statistics, released in December, show that California recorded domestic outmigration of about 135,000 people. It was the fourth consecutive year that more Americans left the state than moved in.

Each person who leaves the state has a different story. Bertha at Base Line U-Haul in San Bernardino declined to give her last name but said she has noticed people who recently moved to California are moving east again.

One woman who made the trip from Florida didn't find what she was looking for and rented a trailer for the return trip. Several families have returned to Colorado recently, she said.

Alaina Harris, now of Oklahoma City, said she grew up in Vacaville and went to college at Vanguard University in Costa Mesa.

She said she moved to Oklahoma City to take a public-relations job after earning a master's degree from Georgetown University in 2007.

This story sound familiar, and we recalled a 1977 Second City TV film spoof called "The Grapes of Mud" that took up the Tom Joad story after he gets out of prison and meets up with his family just as they're escaping the California mudslides for safe, dry Oklahoma.

"Grapes of Mud" wasn't SCTV's greatest effort. They didn't have much of a production budget to play with when they were starting out, but the bit was still funnier and smarter than just about anything else on TV at the time. The SCTV troupe went on to do some hilarious pieces, like Martin Short's over-the-top Jerry Lewis in an Ingmar Bergman-directed "Scenes from an Idiot's Marriage" - something that only a Frenchman could love.

In any case, SCTV preceded reality by a good 30 years. We always knew they were a couple steps ahead of the entertainment crowd, we just didn't fully appreciate their prescience at the time.

More State Money Talk

Well, it didn't take long for the great state budget fight to heat back up.

Just yesterday we had a post or two about the financial problems our city and every city in the U.S. is caught up in. We also speculated that there might be more problems on the horizon. Californians were beginning to get comfortable with the notion that the geniuses on both sides of the Sacramento political aisle had solved our state's budget problems.

Now comes a warning from the state's Legislative Analyst's Office (LAO) that we're still likely to face an $8 billion shortfall, despite the budget agreement and the $31.5 in federal stimulus package money California is slated to receive.

The Sacramento Bee's Capitol Alert reported that the legislature's budget analyst, Mac Taylor declared yesterday that "the state's economic and revenue outlook continues to deteriorate." The Capitol Alert post went on to say:

"Even in the few weeks since the budget was signed, there have been a series of negative developments. Our updated revenue forecast projects that revenues will fall short of the assumptions in the budget package by $8 billion. Consequently, the Legislature and governor will need to adopt billions of dollars in additional solutions in the coming months to bring the 2009-10 budget back into balance."

Taylor had some more bad news for the state's political leaders. Because so many of the "solutions" adopted last month are temporary, "without corrective actions, the state's huge operating deficits will reappear in future years - growing from $12.6 billion in 2010-11 to $26 billion in 2013-14."

The Los Angeles Times also quoted Taylor in an article in today's paper:

California's economy in is such bad shape that Taylor's office anticipates that residents' combined personal income will be lower this year than it was last year, leading to fewer tax dollars for state coffers.

"I went as far back as 1950, and I could not find a situation in which personal income had actually declined in the state, so that's a rather unusual event," Taylor said at a news conference Friday.

Taylor's projections assume that the all of the various ballot measures the budget agreement depends on will pass in May. Those assumptions are far from certain, however. The California League of Women Voters issued a press release on Thursday coming out against Props 1A, 1C, 1D, and 1E. The League says these are bad policy:

“We oppose these measures because they are NOT the solution to our long term financial crisis, with the continuing structural deficit in the state budget and flawed budget process,” said Janis R. Hirohama, president of the League. “We make this decision with regret. We would support real reform to make the state budget process more accountable and give the Legislature and Governor effective tools to advance state priorities. However, these hurriedly drafted propositions, produced at the end of a flawed process that kept both the public and most legislators in the dark, will only make our fiscal situation worse.”

This bodes ill for the likelihood of the measures passing because you know there also will be plenty of anti-tax and small-government activists fighting the propositions. Here's the full LWV press release (click on the box in the upper right corner to enlarge):

* * * * *

In case you were curious about how we got into this mess in the first place, there's a really good video that explains how our financial house of cards fell apart. We saw this on the Original Skrip, and also saw it on the Foothill Cities blog back when it was still a semi-regular blog.

The video's 11 minutes long, but it is worth watching if you've got the time to spare:


The Crisis of Credit Visualized from Jonathan Jarvis on Vimeo.

Saturday Economic Report

Uploaded to Flickr by Abraaten
The bad news on the economy just keeps rolling in. The national unemployment rate hit 8.1%, the highest in 26 years, and in California the numbers were even worse, topping 10%. There was plenty of bad news floating around locally:

CUSD LAYOFF NOTICES APPROVED

More bad news from the Claremont Unified School District. The CUSD Board of Education voted Thursday to issue 34 layoff notices to CUSD teachers and nurses. The notices aren't final, but they are the necessary first step if the district has to go through with the layoffs in June.

Wes Woods II reports on the layoff notices in the Daily Bulletin, saying that CUSD is facing a $3-4 million budget deficit through the end of the 2009-10 school year. Woods article said that boardmember Steven Llanusa was the only one to vote against issuing the notices.

Woods also explained some of the actions the CUSD board has already taken:

[CUSD Assistant Superintendent Devon] Freitas said there was already 12 staff position cuts from the district in February.

Among those positions eliminated then were the director of an adult school, director of a child development programs and director of secondary educations, Freitas said.

Lisa Shoemaker, assistant superintendent of business services, said the cuts and reductions were being used to address a $3 million to $4 million deficit for the district in the 2009-10 school year.

JOURNALISTS TAKE THEIR HITS, TOO

Print journalism continues its bleeding. You may have noticed the Los Angeles Times California section disappeared, getting folded into the main, front page section. The Times advertised this as good thing, saying that you can now get all your local and national news in one place, but the fact is it was a cost cutting measure.

LA Observed blogger Kevin Roderick gave the reasons for the Times' decision to ax the local section:

The backdrop, of course, is the economy and the Times' continued free-fall in ad revenue. By getting rid of California, the Times can print the more profitable Calendar section at night and eliminate the expense of a second, earlier daily press run. (Times presses can only handle four sections per run, as this post from last Friday discussed. Note, too, that pressmen are the Times' only unionized workers.)

The move will apparently be spun as an enhancement in local coverage, but Times officials are bracing for howls of protest from print readers who already have been canceling subscriptions over the paper becoming thinner and less well edited. Some LAT officials fear this might be a tipping point. "We can't keep alienating our core readers," a senior person told me. Papers that have tried doing away with just their Business sections have been stunned by the backlash; the Orange County Register reversed its decision to mollify readers.

The added efficiency the Times gained by eliminating the California section allowed the paper's management to show some love for their press workers by eliminating 63 pressroom jobs, reports Ed Padgett.

The Times seems to be giving new meaning to the phrase "Stop the presses!"

And Gary Scott's blog informs us that the Seattle Post-Intelligencer wants to top the LA Times and completely eliminate its print edition, along with 75 percent of its staff.

Meanwhile, over at the Daily Bulletin and at other Dean Singleton-owned LA News Group papers, employees who have survived layoffs have been forced into mandatory furloughs. David Allen had a seven-day unpaid break but was back in the media mix this week with new columns and a few posts about what he did on his forced vacation.


CLAREMONT STILL WAITING ON THAT $850,000

In case you were wondering if the state's $42 billion budget fix was going to free up that $850,000 grant for Claremont's Padua Ave. Park, Magic 8-ball's answer would be, "Ask again later."

You may recall that the San Gabriel and Los Angeles Rivers and Mountains Conservancy (RMC) grant to Claremont was approved but never delivered because California placed a moratorium on issuing new bonds.

October 14, 2008, Claremont City Council
proudly receives $850,000 rubber check from RMC

Although the state has balanced its books (for the moment), Claremont will have to wait a while longer before California can go back to issuing voter-approved bonds for projects like Padua Ave. Park. The RMC's website had a notice:

BUDGET IS SIGNED
BUT THERE IS NO IMMEDIATE CHANGE FOR RMC PROJECTS
Updated March 2

While adoption of a state budget is a critical step in addressing the freeze on sate bond funds, the Department of Finance has advised state agencies that: the cash flow results of the solutions adopted in this budget agreement need to be analyzed. After this process, the State Treasurer’s Office will begin to proceed with bond sales. But it will be some time before we know the amount of cash available to address past and future obligations for these projects, as well as past obligations for the nearly 5,400 projects and grants that have been stopped. It will be some time before the projects and grants that have already shut down will be able to restart. It will also take time to determine when any new projects will be able to start.

As a result of the bond freeze, on December 18, 2008, the RMC notified all grantees to stop work on all bond funded projects and laid off several consultant staff. The remaining staff continue to work with our grantees — in particular to update files and prepare billing for all work performed prior to December 18, 2008. In addition, the Governor has declared that all state employees will be furloughed two days per month; it is expected that our offices will be closed on the 1st and 3rd Fridays of the month beginning February 6, 2009.

At this time we do not know when payments for expenses incurred prior to December 18 will be released, when the freeze will be lifted on existing projects, and when we will be able to authorize new grants. For information on the status of a specific project, please contact us directly.

Needless to say these are challenging times and there are no certainties regarding when the freeze will be lifted. Although updates to this website will be done irregularly, we will update this page with new information as it becomes available.

Among the laid off staff was Claremont's own Tim Worley, a former city Traffic and Transportation commissioner, who was the RMC's water policy director.

Play Money

In case you missed it, on Sunday the state of California stopped making payments on a number of things, including money owed to state contractors, Cal Grant recipients, and taxpayers awaiting refunds.

Also, California will begin mandatory two-day per month furloughs of 238,000 state employees to conserve cash. Even with these measures, the state will be out of cash by the end of this month, and then the trouble will really begin.

These emergency measures, enacted by Governor Schwarzenegger and State Controller John Chiang, are happening because the State Legislature and the governor's office have not been able to come up with a budget compromise to close the $42 billion chasm the state currently faces.

In the latest developments, state Republicans are threatening to censure any of their members who vote for tax increases. The state's super-majority rule on budgets means the Republicans can hold up any budget compromise, provided they keep their legislators from crossing the aisle to vote with the Democratic majorities in the State Assembly and State Senate.

Anthony Adams, the Republican Assemblyman for the 59th Assembly District, which includes Claremont, has indicated a willingness to vote for some tax increases. Adams, whose district had trended ever more center-left in recent years, by necessity has to be more moderate than some of his Republican colleagues in districts with safe seats. Thus, Adams has signaled an openness to tax increases even though it could mean the end of his political career since it would give anti-tax opponents in a Republican primary election ammunition to attack his record.

On Sunday, a Daily Bulletin editorial defended Adams' stance, saying:

Adams is a Republican, and it's GOP heresy to admit that any tax might ever have to be raised. Never mind that no Republican legislator can or will tell you how to cut $42 billion in spending from state government spending over the next 18 months. Shall we close all the University of California and Cal State University campuses and shut down the state's prisons, releasing all the inmates? Sorry, that's not enough.

So Adams, whose district includes Claremont, La Verne and San Dimas, said a very reasonable thing: that it would be worth raising some taxes in this fiscal emergency if the return were some guaranteed restraint in the future on the kind of past overspending that put California in this mess.

We find that a sensible position, exactly what Republican legislators should be seeking instead of just repeating their simplistic "no new taxes" pledge. They have leverage, and they should use it to protect the fiscal future; but there's no getting
around the emergency faced right now without more revenue from some sources.

Adams took considerable heat from KFI AM-640 talk show hosts John and Ken last week, as Rebecca Kimitch reported in Bulletin on January 28th:

Adams' statements, and similar comments made by several other Republican legislators, flies in the face of a "no new taxes" pledge most Republicans signed last year.

The change of heart has inspired the John and Ken Show radio program on KFI AM-640 to castigate Adams - and three other Republican lawmakers - on the air.

Hosts John Kobylt and Ken Chiampou have started a "heads on a stick" campaign calling on listeners to tell Republicans to "stand firm on taxes or else."

"Listeners think (the campaign) is right on, they are ready to run out with sticks themselves. There is going to be a tax revolt if (lawmakers) do this... there is going to be a big backlash," Kobylt said. "We'll see propositions to reverse the taxes, and efforts to throw these guys out."

Sacramento's budget impasse prompted 11 of Dean Singleton's MediaNews Group-owned California newspapers to run a front-page editorial excoriating our political leaders this past Sunday. Here's part of the San Jose Mercury News' version:

Today, the state will stop paying some of its bills and start issuing IOUs. It will stiff taxpayers due refunds, students depending on Cal Grants to stay in school and contractors who have performed work. If the days without a budget lengthen, economic havoc will spread like a virus, and the state's bad faith and credit will infect cities, counties and schools.

The governor and all 120 legislators share responsibility for this. But most of the blame for the immediate crisis falls on Republicans in the Legislature, who this past summer — to a person — signed a pledge to not raise taxes. That was before an already large deficit mushroomed, making the need for more revenue imperative. Since then, Democrats and the Republican governor have offered significant compromise, but GOP lawmakers cling to ideological purity — schools, health care and other essential responsibilities be damned.

These lawmakers constitute barely over one-third of the Legislature. But because the California Constitution requires a two-thirds vote on the budget, it enables the tyranny of a minority to trump majority rule.

This day didn't sneak up on anyone. It's the result of too much borrowing and too little political courage over too many years — lavish spending in good times and insufficient restraint in bad. For this, Democrats, who've controlled the Legislature, and the governor share responsibility. Compounding the problem are spending initiatives that bind the Legislature's hands. Voters have themselves to blame for these.

The governor and legislative leaders were scheduled to meet again yesterday to try to figure a way out of this mess. There was no word of any resolution, however. Oh, the games people play.

$3.5 Million Budget Shortfall Handcuffs City

The Claremont City Council is having a special session meeting today that is open to the public. The meeting runs from 8am to noon in the Padua Room of the Alexander Hughes Community Center. The Hughes Center is located at 1700 Danbury Rd., just south of Scripps Rd. between Towne and Mountain Aves.

If you don't have anything better to do, or even if you do, you may want to get out to the meeting. The City Council will be discussing the worst financial situation it has faced since the early 1990's. The City is breaking the bad budget news it has quietly alluded to recently. According to the staff report for the meeting, the City of Claremont is facing a $3.5 million combined budget short fall for rest of this fiscal year and for FY 2009-10 - that's roughly 17 months.

The shortfall breaks down this way: $1.5 million for FY 2008-2009, the budget year ending June 30, 2009, and $2 million for FY 2009-10. We're not sure if these numbers include things like a possible June increase in the City's payments into its CalPERS employee pension account by up to a third of current payments, and there are numerous other variables: the housing market, the unemployment rate, the economy and the continued sales tax slump.

The staff report gives an analysis of the problem:

The City of Claremont is feeling the impacts of the current economic situation across the country and the world. While the City has been fortunate to not suffer as severely from the foreclosure crisis as some of our neighbors, nevertheless, Claremont's other key revenue sources are down. Automobile and other sales are down Transient Occupancy Tax paid by visitors staying at our hotels are down, and development has all but stopped.

The report gives a table showing the projected 2008-09 revenue shortfalls:

Click to Enlarge

And here are the revenue shortfall figures for FY 2009-10:

Click to Enlarge

In addition to the decrease in revenues, the remainder of the projected deficits will come from anticipated increases in operational expenses.

To address the shortfall, Claremont City Manager Jeff Parker has come up with a proposed plan to take $1,011,000 in "onetime unanticipated revenue" (money from grants and fees that the city received but did not budget for) and apply those towards the FY 2008-09 deficit.

The remainder of the deficit reduction for 2008-09 and 2009-10 will come from across-the-board departmental reductions, including reductions in employee benefits, which Parker and his senior staff have been negotiating with the employee unions.

Parker is asking the City Council to approve his recommendations for adjusting the 2008-09 budget, to receive and file Parker's draft 2009-10 budget plan, and to direct Parker to come back to the Council with a final 2009-10 plan on February 24th.

We should note that $2.2 million of the total deficit - about one-third - comes from the city's (primarily Mayor Ellen Taylor's) refusal to put off construction of the Padua Ave. Park until the fiscal crisis passes. Also, the downtown trolley represents a diversion of $1.2 million in funds that might have otherwise been used for traffic related projects like road repair and maintenance.

But Taylor and others see things like the park and the trolley one portion of their legacy to Claremont. The deficit, which may turn out to be larger than projected if the economy does not improve soon, will be the other.

Below is the staff report for today's special budget meeting. Click on the box in the upper right corner of the window to view a full-screen version of the document.
1 31 09 City Budget Report

Publish at Scribd or explore others: Reports Periodicals & Report 1312009 city of clar

California Catches a Break

The Los Angeles Times reports today that the federal government's proposed $825 billion (that's BILLION with a "B") economic stimulus package, could include over $11 billion for California. Most of that, about $7.3 billion, would go towards healthcare costs to fund Medi-Cal programs. Another chunk, about $4 billion, would go to education.

This would all help whittle down the projected state budget deficit from around $42 billion down to only $31 billion (again, with a "B"). Still, this all makes it easier for Sacramento leaders to cobble together another one of their last minute fiscal agreements. Hopefully, the feds aren't just enabling more bad behavior on the part of our state government and that we will end up with permanent, long-term solutions that will prevent this sort of near-collapse from happening again.

As the Times article observed, the money, though enormously helpful, won't prevent the state from having to begin issuing IOU's come February:

"It will be a huge help to us in resolving our current fiscal problems," state Senate President Pro Tem Darrell Steinberg (D-Sacramento) said.

But he and Assembly Speaker Karen Bass (D-Los Angeles) warned that it solves only part of the state's problem and lawmakers are running out of time to deal with the rest. "We have to make really horrible cuts, and we have to raise revenue, but we are just hoping whatever we get will help us avoid deeper cuts," Bass said.

State Controller John Chiang plans to suspend payment of tax refunds, college grants and some welfare checks if lawmakers do not take action by Feb. 1. The state, he says, simply won't have the cash to cover them.

Legislative leaders on Thursday met with Gov. Arnold Schwarzenegger to discuss the budget in their first joint meeting in nearly a week. The three-hour discussion failed to produce any agreement.

Let's just hope the stimulus package isn't treated as so much fiscal meth by the hopelessly addicted in our state capitol. Intervention is still the order of the day on both sides of California's political aisle.