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packerfan - > Blogs from Stan -> Your Tax Dollars At Waste, AGAIN!
Your Tax Dollars At Waste, AGAIN!

Here’s an update for you from Monday’s City Council meeting. In the past we have discussed Mitigation Fees. That Blog has disappeared, so I’ll redefine. Mitigation Fees are the impact fees that the City collects on new construction to offset the cost of water, sewers, new roadways, etc.

 
Until recently under David James’ management, mitigation fees were NOT collected up front from the developer because there was some convoluted formula for calculating those fees based upon whether a retail space was going into a new development or a restaurant as each would have a different impact on the infrastructure.
 
Because these fees were not collected upfront from the developers and the developers were not disclosing these fees to their new tenants UNTIL AFTER the tenant had spent considerable money in tenant improvements, there have been three separate occasions where we as the City have made arrangements for the tenants to repay the City on a contract basis for these mitigation fees.
 
The two most recent instances were Que Pasa and Don Pericos. I argued during the council session that we, the City, were not a bank and the developers were pulling a fast one, to which Mr. Garrett agreed, and that we should not be loaning money even at 0% interest. Even the City Attorney agreed that he did not think the City should be in the business of loaning money. We wanted the developers to pay the fees and work out the situation with their tenants.
 
However, my esteemed colleagues, Mayor Grimes (at the time), Debra Hand, Phil Smith and Linda Vernon, in their infinite wisdom voted 4-1 against me to allow the tenants to repay the City at $3,200 per month over the next 3 years or roughly $115,000. NOW, Que Pasa has filed for Chapter 11 bankruptcy. The City is not listed as a creditor even though notice was given. That means the City most likely will never recoup these fees unless David James can come up with a solution.
 
Also, note, Don Pericos wants to renegotiate with the City because, expectedly, the $3,200 per month is eating into their operating margin. If you want to put a stop to this madness, please vote out Mayor Hand and Ed Grimes in November. Their ‘business usual’ attitude is wasting millions of dollars and with the State budget shortfalls that are looming we can’t afford Mayor Hand and Ed Grimes’ way of doing business any longer. Check out www.StanBeckham.com for more information.
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posted by packerfan on Wednesday, April 9, 2008 at 10:10 AM
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posted by charlee on Apr 11, 2008 at 11:33 AM

 They are extreme. It is just like banks now. They charge you "fees" for NSFs nearing forty bucks a pop, even though it costs the bank a few cents to return a check. But, they wait until the end of the day to post checks so they can decide which ones to post first. For example, your rent check for $1200 comes in on the same day as four or five other much smaller checks. They will pay the largest one first so they can bounce the others and collect as many "fees" as possible. They also wait until the end of business to post deposits, once again enabling them to take more money from the customer's account. Bank executives actually get huge annual bonuses for collecting the most fees from customers!

The mitigation fees are the same thing. It may cost the city a few hundred in actual impact, but they have to jack up the price through the roof to increase revenue. And, instead of charging per building, they charge per business. They get more cash that way. There is a definite community impact when new building is done, but to the tune of $90-100,000 per small business? That is way too excessive. And the fact that they neglected to tell businesses that the city was raising the fees by over 100% is ridiculous. The exorbitant payouts are making it impossible to open a business, unless of course, you have tons of liquid assets to begin with. And before you say, "well, the city needs that money to improve the roads and water systems", the roads in Tehachapi are still in deplorable shape, and the water situation especially in east Golden Hills is critical. Where are all these profits from fees going? I know they are not going toward improvements.

BTW, gube, it is mitigation, not migration.

posted by ProgressoDasani on Apr 11, 2008 at 12:17 PM

 Charlee, you may be correct about mitigation fees being too high in general.  But to develop the corner of Tehachapi Blvd and Tucker where Que Pasa is located, the city had to build a sewer force main, i.e., a pumping station to move the wastewater to the wastewater treatment plant, so developing that corner took a substantial outlay by the city.  I don't know how much (who does in the crazy quilt of civic accounting?) but I wouldn't be surprised if it were $1M or more.

As for East Golden Hills, that is out of the city limits and none of the mitigation fees paid to the city is going to help that problem.  Gotta go see GHCSD for that!

 

posted by gube on Apr 11, 2008 at 12:26 PM

 BTW, gube, it is mitigation, not migration.

lol

posted by gube on Apr 11, 2008 at 12:46 PM

 What!....a little off centered........ha ha ha true

posted by gube on Apr 11, 2008 at 12:50 PM

 Hey who's deleting comments?.....................

posted by charlee on Apr 11, 2008 at 01:00 PM

 I forgot that GH is in a different jurisdiction. But I sure would like to see some of that revenue going toward street maintenance. The potholes near my house are ridiculous, and what's with those huge trenches at some of the intersections? Those should be levelled out some; I drag my car on them every time, and I'm barely moving.

gube, guess you just thought you were writing about illegal immigration again. ;)

posted by gube on Apr 11, 2008 at 01:12 PM

  mitigation- migration .........it's a honest mistake lol........... I got a big laugh out of it yesterday when oohchild brung it to me attention.....

posted by eekitsaspider on Apr 11, 2008 at 01:55 PM

Yes Gube a little off centered but you have grown on most of us...I cannot believe someone deleted my comment just not right.... 

posted by packerfan on Apr 11, 2008 at 03:21 PM

 I'm sorry eek.  What was your comment?  I don't like people deleting comments from my blog.  But, then again, when I posted this blog I saw it post around 8:00 p.m. one evening and by 8:00 a.m. the next morning it was gone.  I had to repost the darned thing.  Anyway, post again and see what happens.

As for the cost of the mitigation fees, I do know that the cost to put in new infrastructure is not cheap.  But, I also know that your City Hall and City Council are spending money hand over fist like there is no tomorrow.  They just don't get that the housing bubble and those 'anticipated' tax revenues are OVER.

We get our mid-year budget for review soon, I hope!  Mid-year was January, but the state came down with their cuts and I know we had to wait to see exactly where those cuts were to be made.  But, once the mid-year budget is given out, I am going to push for a minimum of 10% cuts across the board.  There is no reason that any department should be spending every penny that is budgeted to them.  We just can't afford that anymore.

posted by eekitsaspider on Apr 11, 2008 at 05:28 PM

I had just stated that what irish1 posted was rude and that gube is sometimes a little off centered but he/she seems like a decent person.... Nothing bad atleast I thought so...

posted by gube on Apr 11, 2008 at 05:45 PM

 eek you said nothing rude. I wonder why Irish's post was deleted to? Lets see............both you and Irish's comments where deleted right.......Who deleted them.......Irish sounds like paralegal39 or who I like to call ''Whoopi'' Irish was saying that me gube and Shane and dreamkiller are the same person.I replied to Irish that she sounded like Whoopi and few minuets latter she deletes her comment.

Oh wait a second one of my posts was deleted to ha ha..........that means either Stan or the Admin deleted all 3 comments.............I can't see the Admin deleting them because they where not out of line..........That leaves only Stan...........
Stan are you deleting comments and why?

posted by VtKid on Apr 11, 2008 at 05:45 PM

 Stan,

Do you know if the infrastructure costs for any of the new housing developments, of which are now "on-hold", were paid for in advance? Is this another situation similiar to these commercials properties, where the city picked up the tab and waited for the developer to collect and repay? How much in predicted sales tax on these homes was factored into the city budget planning for the next few years? Which new businesses - besides food service - are on the horizon to relocate here? There seems to be plenty of planning and discussion for new street lights in the town center but I heard the schools don't have enough lockers & books? I'm all for maintaining a small-town, cozy atmosphere; I grew in one back in the Northeast; but at some point the city management needs to make some tough financial decisions now to ensure the future is just that - a future.

    Scott

 

 

 

posted by eekitsaspider on Apr 11, 2008 at 08:29 PM

Thanks Gube for not getting offended by my comment of you are sometimes off centered but seem like a decent person... I did not mean it to offend you in any way... You really do seem like a decent person with some really good intentions...

 

posted by packerfan on Apr 11, 2008 at 09:41 PM

 Late night for an old guy.  Lots to talk about.  See you in the AM.

posted by awsmom8 on Apr 12, 2008 at 12:07 AM

 OK Stan--this is off topic but I don't think you will mind.  What input is the City going to have on the proposed 2000+ inmate increase at CCI with 600+ jobs generated?  With the prison being enlarged it is going to increase traffic on the 202.  Has the city proposed to the state to widen the 202 at least thru town to handle the increased traffic from prisoner transportation and the 600+ employees that will travel the 202 every day?  Or is the bottle neck only going to get worse?  Right now CCI is many thousands of inmates over what it was built for.  Does this mean they are finally building accommodations for the overflow or are they going to add a few thousand beds then increase the inmate population by another several thousand?  I feel the prison need to pay  "mitigation fees" in the form of footing the bill for widening the 202.  Also with no new hospital in sight, the added beds are going to strain the hospital.  We already wait up to an hour for a paramedic ambulance when the primary medic unit is out on a call.  The added prisons beds are going to increase the need for EMS and ambulance services, causing a further strain on the "one" paramedic unit in Tehachapi.   Are the outlaying areas as well as the city going to suffer from this increase in EMS services needed at the prison?  Halls already makes several trips out to CCI every week, sometimes several times a day and I am afraid with  only one paramedic ambulance in town problems are going to happen.

 

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