The Elephant in the Council's Room

There are two items on tomorrow night's agenda I want to talk about and an important item not on the agenda.

Item #6b CFD 93-1 Improvement Area 18 Letter to the Stetson Residents

This item is in the newly created section on the agenda known as "Items for Possible Future Action." I'm not sure what they are planning. If they had a letter ready for council approval, I don't belive "possible future action" would be the appropriate assignment. My guess is they will try to reconsider their decision to address our concerns. I hope not but we will be ready with a response. I would like to ask the council members to Google "Indio terra lago tax" and learn how the City of Indio is following state law to address a petition by CFD property owners for a Resolution of Consideration. 

There is no documentation for any of the items listed in the "possible future action" section and from the council's comments at last the meeting, I believe the Council is under the belief that they aren't required to take public comment on items in this section. I know from an article I read a while ago, the city staff used to believe items in their "Consent Agenda" were also protected from public comment. They appeared to have learned a little more about the Brown Act and they do allow for public comment on Consent Agenda items. I wonder if a Workshop on The Brown Act might help our council members, I know it would help the public.


Item #8.a Resolution to approve the Amended Enforceable Obligation Payment Schedule including the City to Agency Loan 

The city is carrying a $21.5 million asset on their books that has masked the deficit spending they have been doing over the last two fiscal years. According to the City this represents loans made by the City to the Beaumont RDA (Redevelopment Agency) before it was replaced by a City created successor agency when the State ended the Redevelopment Agency programs. The City is needs to collect this loan from the Riverside County Tax Payers. The approval for the County to release the money to the City must come from the California State Finance Department. This is an asset the City's own auditors believe is uncollectable.

Last year when I first found about this and began following the City's finances more closely, I learned the City already had a few of these request for enforcement of RDA obligations refused by the State. Some of the reimbursements denied by the State had already been paid to the City and the City was required to pay the money back to the County. The City of Beaumont's schedule of payments is abot $300,000 a year. I believe I read somewhere, it may have been in the audit released last year, that the money would all have to be paid back before the City could make any new requests.

In my post on November 3, 2013, I asked - How will the City of Beaumont collect the $21.5 million debt that is keeping them out of a $4 million hole when they aren't even requesting it? for more details on the City's requests to the State for RDA reimbursements you can read my post:

$21.5 Million Redevelopment Debt Beaumont Needs For Solvency

If the state approves this amended schedule I'm not sure how it will apply to the annual payments the City is making to the State now but it may pull them out of the hole. If as the auditors believe, and is the history of the State with these types of requests, it is denied, the City will no longer be able to carry it as an asset and will be forced to acknowledge they were $4 million in the red as of the last completed audit, 2011-2012. Yes, that's right, the 2012-2013 fiscal year ended 8 months ago and there is no sign of an audit.

I applaud the City for suggesting the Council to begin this process; it will be interesting to follow. I imagine the council could decide to not approve the resolution but I am sure their is some deadline the City has to meet to make the request before they give up their right to. The succesor agencies weren't designed to be around forever, at least that wasn't the way they were sold to the people. 

The City has to meet a few requirements to qualify for this reimbursement including telling the State where the $21.5 million was spent and that it was spent on redevelopment projects. This would be one of the first questions I would like to see a Council Member ask but I am content in knowing that the request sent to the State will have to provide the details.

I recently read a local news article published a number of years ago about the Redevelopment programs and how the money should be spent on areas of the city that had been under maintained. I read a comment  the Economic Development representative for Beaumont where he indicated the money would be used strictly for redeveloping the neglected areas of our City and not on interchanges and improvements for the new developments. 

My final thought:

If this is approved by the State, I wonder how the County Tax Payers will feel when they realize they are paying the City of Beaumont 12.5% interest on more than $20 million?

The Elephant In The Room

One item not on the agenda that will probably be the most talked about issue tomorrow night will be the elephant in the room. The elephant's name is Gateway. I know there will be a number of citizens, myself included, that will speak during the public comments section to ask the Council to go on record against the rezoning of the land in Cherry Valley to allow a multi-million square foot warehouse to be built at the base of our mountains, right off of Cherry Valley Blvd. I expect Councilman David Castaldo will have something to say on the topic since he is the only council member to come out publicly against the project so far.

Tomorrow should be an interesting meeting to say the least. The meeting starts at 6 PM. I recommend you get there early if you want to speak and fill out a speakers request form. Even if you aren't going to speak, I recommend you show up early to get a good seat.