CalPERS sticks Ventura with extra unfunded pension liabilities

The Looming Catastrophe of Unfunded Pension Liabilities in Ventura

“IT ISN’T WHAT WE DON’T KNOW THAT GIVES US TROUBLE, IT’S WHAT WE KNOW THAT AIN’T SO”
—Will Rodgers

NEGLECTING THE UNFUNDED PENSION CRISIS DOESN’T MAKE IT DISAPPEAR

For eight years Ventura has done little to remedy the unfunded pension liability. During that time, there have been three different City Councils. Yet they made only a modest effort to solve the problem. They got employees to agree to contribute toward their own retirement. Meanwhile, those same City Councils have exacerbated the problem. They granted large raises to public safety and SEIU employees. This is a case of ‘too little, too late’.

Eight years ago, we pointed out the amount of pension benefits Ventura owed. We owe these benefits to retired city employees and those about to retire. We owed $150,000,000 of unfunded liability. Two major pension plans account for the entire liability—Public Safety and Miscellaneous.  The Public Safety pension plan covers police and fire retirees.  The Miscellaneous pension plan covers all other employees.

The Ventura County Star reported the deplorable condition of Ventura’s pension plans. And, the Grand Jury labeled the plans as “out of control.”

The office of the City Manager tells us that they have everything under control. And, in 5 years things will level out. There are no records or calculations offered to support that statement.

STILL LIVING FAR BEYOND OUR MEANS

CalPERS increases unfunded pension liability costs to Ventura

CalPERS sticks Ventura with rising unfunded pension liability costs.

The problem is simple. Ventura has not set aside enough money to pay for future benefits to city employees when they retire. What’s more, the California Pension System (CalPERS) let Ventura down. It did not earn enough return on investment on the money Ventura paid into the fund.

Since 2008, the situation has gotten far worse. In the last CalPERS report published in 2016, the city’s unfunded liability totaled $169,292,212. In other words, the liability we owe grew 12.9% in eight years.

ONE CITIZEN’S ANALYSIS

The City Manager and City Council knew of this UAL increase before they campaigned for Measure O.

Proceeds from Measure O will be more than $11 million a year for the next 25 years. It may not be enough to cover the debt, though.

CalPERS recently published the projected pension costs for the City of Ventura. Taxpayers are 100 percent responsible for paying these foreseeable costs.

The CalPERS Circular Letter Dated January 19, 2017 contained these facts:

CalPERS lowers its rate of return on investments to 7% impacting Ventura’s unfunded pension liabilities.

The CalPERS Board of Administration approved lowering the CalPERS discount rate on December 21, 2016.

The long-term rate of return will now be 7.00 percent over the next three years. This will increase public agency employer contribution costs beginning in Fiscal Year 2018-19.

For the years 2017 to 2023, CalPERS actuary reports show increases to the annual Unamortized Actuarial Liability (UAL). These costs will increase 91 percent or $8.8 million.

In the CalPERS Circular Letter dated 1/19/17,  the assumed return rate decreased to 7 percent from 7.5 percent. Ventura will pay an extra $3.7 million from FY 2016-17 to FY 2022-23.

Combined, the city’s annual UAL cost will increase $12.5 million to $22.2 million over the next six years.

No other expense or revenue (tax) item will increase that fast. Left unaddressed, these increased costs may force the city to curtail basic services.

EDITORS’ COMMENTS: 

Increasing revenue or reducing expenses solves most budget problems. For Ventura, increasing revenue means more sales taxes and property taxes. And reducing expenses means service cut backs or layoffs.

Increasing revenues and cutting expenses seems like the obvious fix. Yet, a less popular third option is available. The employees must contribute more toward their own retirement. After all, they will benefit the most from these pensions.

Ventura’s long-term solution will be a combination of all three choices. Increasing revenues and reducing expenses with higher employee contributions is the right prescription.

FEEL STRONGLY ABOUT THIS? WRITE YOUR COUNCILMEMBER.

Click on the photo of a Councilmember to send him or her a direct email.

Erik Nasarenko,
Mayor

Neal Andrews,
Deputy Mayor

Cheryl Heitmann

Matt LaVere, Ventura City Council

Matt LaVere

Jim Monahan

Mike Tracy

Christy Weir

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Will The Trade Desk be another real estate blunder?

Is Ventura Poised To Commit Another Real Estate Blunder With The Trade Desk?

“ONLY THE MEDIOCRE ARE ALWAYS AT THEIR BEST”
—Jean Giroudoux

WILL VENTURA CITY GOVERNMENT EVER LEARN?

It’s déjâ vu all over again. Once again the past rears its ugly head. Only this time will the City Council be wise

The Trade Desk may not be the best deal for texpayers

Is The Trade Desk real estate deal a gift of taxpayer money to a private company?

enough to learn from its past mistakes? There are some things this Council and this city staff are not qualified to evaluate fully.

Among the first issues facing the 2017 Ventura City Council is a real estate transaction. Ventura is selling four parcels of  City-owned, prime downtown public property. The properties for sale are at 535 East Main Street.

The fact that the City is pursuing the sale of surplus land is commendable. Selling these properties should be open and transparent. To do otherwise, invites the possible perception of favoritism or mismanagement of public funds. Proper evaluations, bidding and screening needs to happen.

CITY STAFF PROPOSES A NEW DEAL 

Community Development Director, Jeff Lambert, presented a new real estate deal on November 15, 2016. He asked the City Council to approve the sale of a large, downtown city parking lot. The proposed buyer is a company called The Trade Desk. The Trade Desk wants to build a headquarters office building. The proposed offer was $1 million ($24 dollars a square foot).

City staff steered the selection of The Trade Desk as the sole qualified bidder. The City Council depended upon the recommendations of City Staff.

Four months earlier, the City Council relied on city staff’s recommendations on another deal. The city staff did an incomplete analysis before recommending the Brooks Institute project. They compounded this mistake by failing to collect deposits and rent. The Brooks Institute deal fell apart.

This time, the City Council was close to selecting The Trade Desk in another real estate deal. They almost decided without benefit of an independent financial analysis or a professional appraisal.

WHY THE TRADE DESK?

The Trade Desk is a Ventura success story. Does that entitle the company to favorable treatment from city government?

The Trade Desk is a success story many citizens do not know about. The City of Ventura funded an incubator business startup program. They used $5 million of taxpayer’s dollars to seed the fund. The Trade Desk was a beneficiary of the subsidized program. The Trade Desk is a large tech company that brought new jobs to Ventura. The company achieved early success. With their success, the Trade Desk went public and the stockholders have made millions. A true success story for Ventura.

The Trade Desk wants to enjoy the city’s largess, again. This time, they want to buy city property for their headquarters at below fair market value. Their business success should not cloud City Hall’s judgment. City Hall should not sell public property at a discounted price.

DOES THIS DEAL PASS THE SMELL TEST?

A first whiff of impropriety surfaced during the election. The Trade Desk donated $7,000 to support the successful city-backed ½¢ sales tax measure.

Another whiff arises with regards to the questions the city asked to approve The Trade Desk. A close examination of the specific judging criteria reveals the questions were subjective.

Of the three bids submitted, city staff selected The Trade Desk as the most qualified bidder. In its proposal, The Trade Desk offered $1,000,000 in cash for the properties.

The city purchased the properties for $618,000 in 1997. The city valued the properties at $1,684,000 in the original proposal. They base their estimate on a 6 year old value (10/25/10) comparable price for a city parking lot. The city’s valuation is $40 per square foot.

A QUESTION FROM THE AUDIENCE SLOWED DOWN THE PROCESS

The third impression of impropriety is how much the city valued the property. The city valued the property at $40 per square foot based on a 6-year old comparable property. In the same council meeting, city staff urged the Council to buy another parking lot for $64 per square foot. City staff recommended buying the parking lot for $64 per square foot. This established a new comparable price.  The new comp values the parcels at 535 East Main Street at more than $1,684,000.

The City Council seemed oblivious to the conflicting valuations. A citizen in the audience brought it to the Council’s attention. Only then did the City Council call for an independent appraisal.

It’s a mistake to sell The Trade Desk these downtown lots for $1 million, when the true value is closer to $2 million.

GIFT OF PUBLIC FUNDS?

You decide if The Trade Desk real estate deal is in Ventura’s best interest.

The city staff recommended to City Council to sell the property at a price below market value. This is another real estate blunder the staff made in 2016. In essence, it would be a gift of public money through the sale of property for less than market value. The sale would enrich The Trade Desk’s shareholders on the back of Ventura’s taxpayers.

The final whiff of impropriety appeared in the handling of the finances. Ventura city staff was willing to accept $50,000 in escrow from The Trade Desk. The Trade Desk estimates it will spend $15 million to develop the property. The deposit works out to 0.3% of the total value of the project. Such a small deposit amount should have concerned city staff.  One would think they would have learned from their prior mistakes. Not accepting an adequate deposit was a pitfall in the Brooks Institute situation.

EDITORS COMMENT

MOVING FORWARD RECOMMENDATIONS

Negotiations continue with The Trade Desk. Yet, the openness and transparency of this transaction remains in question.

To avoid any appearance of impropriety, Ventura should request new proposals for the property. The city must get an appraisal by an independent, certified commercial real estate appraiser. The sale price must be equal or higher than the appraised value. The city must make new bids public. And the final offer must generate a better return to Ventura’s citizens.

The successful bidder should make  a good faith, earnest deposit. In the event the transaction doesn’t move forward, a deposit protects Ventura’s citizens. The deposit would cover any loss of value or cost to return the property to its current state.          

Editors:

R. Alviani          K. Corse          T. Cook         B. Frank
J. Tingstrom    R. McCord       S. Doll          C. Kistner

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Ventura's Measure O Is Unenforceable

Oversight Of Measure O Is Untenable in Ventura

ELECTION AFTERMATH

Measure O passed in Ventura. Now, the hard part.

Measure O passed in Ventura. Now, comes the hard part: oversight.

2016 was a fascinating and challenging election year at all levels of government.  The City of Ventura was no exception.  Voters elected a new City Council Member and passed two City Charter amendments. Most remarkable of all, Ventura voters approved an increase in the sales tax. This will impact Ventura for 25 years.

The city staff and City Council promoted an extra 1/2 percent sales tax. The increase will raise another $10.8 million per year. That amounts to $270 million for city services over the next 25 years.

THE OVERSIGHT OF A NEW TAX IS UNTENABLE

The final vote count was 28,987 yes and 20,359 no votes. Measure O promises all voters strict oversight of the new money. Measure O mandates: 1) strict accountability 2) a citizens’ oversight committee 3) annual independent financial audits and 4) a public review of expenditures. Yet, the city hasn’t revealed its plan to put this strict oversight in place. 

Cheryl Heitmann, Ventura City Council

Ventura Councilmember Cheryl Heitmann

A lack of plan contradicts one councilwoman’s official position. She stated that her reelection was a signal from the voters. She believes voters think the City Council was spending the taxpayer’s money wisely. The 20,359 citizens that remember the Brooks Institute failure might disagree.

A LONG HISTORY OF BROKEN PROMISES IN VENTURA

Ventura citizens must hold City Government to its word.  Promises are sometimes forgotten or even ignored when it comes to money.  One example happened in 1991—26 years ago . City government promised to reduce water and waste water rates after the drought. The water and waste water rate increases they imposed were temporary. The drought ended. The rates never returned to their previous levels before the drought began. Once they got your money, the promises evaporated.It was also 26 years ago that our city promised desalination as a new water source, if voter approved.  Venturans approve the city’s call for desalination, but nothing happened.  Yet, Venturans still pay for State water rights because of the city’s nonfeasance.

Ventura lacks accountability in city government

Brooks Institute exposed the cracks in the city’s procedures.

Ten months ago, the city promised economic vitality when Brooks Institute moved downtown. Brooks Institute filed for bankruptcy. The project failed.  The City Council and the city staff pointed fingers at each other for that debacle. There was plenty of blame to go around, though.   The staff failed the Council by not performing its duties completely. The Council failed to ask the right questions before approving Brooks’ long term lease.

Afterwards, some City Council members reached a difficult conclusion. They realized the city staff lacks the expertise to assess complex real estate opportunities.

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Brooks Institute Fiasco Exemplifies Ventura’s Bad Money Management

“EVERYONE’S ENTITLED TO THEIR OWN OPINION, BUT NOT THEIR OWN FACTS” —Daniel Patrick Moynihan

 Brooks Institute continues to be an issue

Ventura’s City Council’s bad deal with Brooks Institute exposes its lack of financial understanding. The Council

Brooks Institute closure exemplifies Ventura’s bad financial management.

and the city staff are scrambling to cover up those flaws. They’re feeding voters information designed to distract the public from the real issues. Ventura city staff believes it did enough due diligence. They’re trying to sell that opinion as fact in a Ventura Breeze article dated Sept. 13, 2016. The city staff’s facts ignore economic reality, though.  Follow the money and you will always find the truth. Brooks Institute is no exception.

Everyone’s entitled to their own opinion, but not their own facts

Venturans for Responsible and Efficient Government (VREG) followed the money trail. VREG filed a Freedom of Information Act request with the city. The city provided the documents they evaluated to extend Brooks Institute a 46-month lease. What VREG learned reveals incompetence and lack of understanding.

W Brooks Institute is not an isolated problem; it’s a symptom of a larger problem. It shows the city council’s inability to manage taxpayer money. Brooks Institute surfaced at a time when the city is asking for another $270 million in taxes from Measure O.

Discovering The Cracks in the Foundation of the City’s Due Diligence

Brooks Institute exposed the cracks in the city’s procedures.

The city provided four foundational documents used to check Brooks Institute Holdings, LLC. The city staff believes these documents showed Brooks Institute was a good “risk.” In the private sector, these documents would have been insufficient.  Here is why.

1)    GP Homestay’s Commitment Letter Is Meaningless from a Financial Perspective

GP Homestay, Brooks Institute’s parent company, provided Ventura a ‘letter of guarantee.’ City Manager Mark Watkins announced this at the September 12, 2016 City Council meeting. The decision makers considered this meaningful in the decision to lease to Brooks. The letter has many shortcomings, though.

First, GP Homestay wrote the letter to a third party,not to the City of Ventura or any entity related to the Brooks Institute lease. GP Homestay wrote it to the WASC Senior College and University Commission on January 15, 2016. WASC Senior College and University Commission is an accreditation organization for Brooks Institute’s curriculum.

Second, nobody signed the letter. It is of no value to the City of Ventura as a basis for financial support, or to any of the other groups or businesses defrauded by Brooks.

Brooks Institute parent company, GPHomestay, took advantage of Ventura and its contractors.

Third, the contents of the letter are not something the city can depend on. The letter states, “Green Planet guarantees continued financial support for the proposed period of financial losses prior to reaching the break-even balance between revenues and expenses in 2020.”

This suggests two important facts. One, GP Homestay didn’t expect Brooks Institute Holdings, LLC to be profitable during the entire term of the lease.  Two, after 2020, Green Planet could withdraw any financial support. These are hardly the assurances on which to base a 46-month lease, nor do they guarantee any payment.

2)    Brooks Institute’s Loan Agreement with GP Homestay Arrives after the Fact

The city provided a loan agreement for $2.5 million dated March 28, 2016 between GP Homestay and Brooks Institute Holdings, LLC. This document is worthless from a financial perspective for several reasons.

First, the loan agreement is actually for a line of credit. There is nothing that indicates that the line of credit was ever signed or if Brooks Institute drew from it.

Second, nobody from GP Homestay signed the line of credit document. An unsigned document is worthless. It is unenforceable and not the basis for granting a 46-month lease.

Third, and most important, the date on the document is 33 days after the start of the signed lease. It could not have been available for the City Council to review while doing their due diligence.

The city approved the lease on February 22, 2016—more than a month before this document. So this document could not have factored into the decision to lease to Brooks Institute.

3)    Dissecting Green Planet, Inc.’s Consolidated Opening Statement Balance Sheet

Green Planet, Inc. provided a consolidated statement to the city to support a 46-month lease. The statement dates back to June 16, 2015, making it eight months old at the time the city issued the lease.

Green Planet, Inc. consolidated statement includes six other corporations.  To understand Brooks Institute Holdings, LLC, the city would have to separate out each of these corporations. That’s impossible with this statement. So, depending on this document for financial information would have been a waste of time. To cap it off, Green Planet, Inc. did not provide any guarantees to the city of the Lease Agreement or the construction period. This document doesn’t support the decision to lease space to Brooks Institute Holdings, LLC.

4)    Brooks Institute Holdings, LLC Financial Documents Don’t Paint a Pretty Picture

The financial statements Brooks Institute Holdings, LLC provided lacked substance. First, the statements covered four months. Brooks Institute Holdings, LLC only existed since March 2, 2015.

Upon examining the financial statements, several irregularities signaled danger and demanded further questions. For instance, Brooks Institute Holdings, LLC’s available cash. Brooks would have had only $403,805 in cash if it paid all current liabilities. The balance sheet showed a cash balance of $2,750,598 and Current Liabilities of $2,346,793.

This statement was seven months old when the City Council discussed the lease agreement. Yet the city didn’t verify Brooks Institute’s available cash by demanding bank statements. The city had no way to know how much cash Brooks had available.

The Statement of Income showed a Net Operating Loss of $21,531. GP Homestay expected this loss and future losses until the year 2020, as they stated in their letter. Yet, the Statement of Income is misleading. The Statement of Income shows Net Income of $1,738,026. This is the result of the acquisition of the school valued at $1,759,557. The only reason it showed a Net Income was due to the value it placed on acquiring itself. An acquisition is a one-time, extraordinary event. It does not show true profitability.

The Scramble to Cover Up the Flaws

The city began spinning the story soon after Brooks Institute closed its doors. First, there was City Manager Mark Watkins’ public mea culpa in the Ventura County Star. In it, he stated the city erred on execution on Brooks Institute by not collecting rents and fees. Next, there was an article in the Ventura Breeze by “City Staff” (whoever that is). It read, “As part of the City’s due diligence in determining the viability of the lease, the City was provided access to Brooks’ and its parent company’s (GPHomestay) confidential financial information. Based on that review it was determined that Brooks was solvent.”  City Staff hoped nobody would discover the truth by examining the financial statements. Finally, there is Councilmember Cheryl Heitmann’s plea. She urged the city to get out in front of the problem at the September 12, 2016 council. She reckoned citizens were forming their own opinions without the city’s input.

The city’s rush to move Brooks Institute downtown forced city staff to cut corners.

The truth will out. The city was eager to do the lease with Brooks Institute. The city did a minimal review to rush the deal. After the fact, the City Manager admitted errors in the process. He stopped short of saying the city approved the lease without proper supporting documents. And the city failed to ask and answer many questions before it signed the lease. Even a cursory examination revealed Brooks had only $403,805 in cash. Brooks lacked enough funds to remodel the City site, let alone several other locations.

This situation will take years to resolve. Here’s what we do know now. Brooks Institute closed. The city has unpaid rents. Brooks stiffed contractors for tenant improvements they completed. The city will have to renovate the buildings Brooks leased to lease them to someone else. Brooks Institute Holdings, LLC didn’t couldn’t fulfill its obligations on the 46-month lease agreement. And, neither the city staff or the City Council researched enough before issuing a long-term lease agreement.

These are the facts. The city is trying to distract the public by zeroing in on the amount of money the city lost. The City Council and the City Manager want voters to believe the losses were $70,000. That amount of money is significant in itself. It may not be the full extent of the city’s exposure to losses, though. The real exposure is closer to $1,095,000. There is the $70,000 in lost rents from Brooks Institute. There is also the $825,000 mechanic’s lien by the contractors that the city refuses to pay. There will likely be legal costs to defend that position. Finally, it will cost $200,000 to return the sites into leasable condition according to Mark Watkins.

Editor’s Comments

The city played fast and loose with taxpayer money on the Brooks Institute deal. The city made several public apologies. They sympathized with the Brooks Institute students and facility over their loss. Yet, they admitted no wrongdoing. There was no apology to the City Council for making them look foolish and uninformed. But, worst of all, the city didn’t apologize to the taxpayers. It’s the taxpayers who pay for the city’s mistakes.

With or without an apology, though, one thing remains clear. The city has mismanaged taxpayer money on Brooks Institute. The situation demonstrates city staff and City Council’s incompetence or lack of understanding. So, it would be imprudent or foolhardy to trust this City Council with another $270 million through Measure O.  Don’t give city government more money until they show they can spend the money they have. Vote No on O.

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Vandalism a part of election rancor

Election Rancor Flares Up In Ventura

ELECTION RANCOR AND MALICE IN OUR MIDST

It will be hard for anyone not to remember this election. The election rancor and display of malice that has bombarded us on a daily basis by many of the candidates, and those supporting or opposing ballot measures, has been destructive if not disgusting. The disrespect shown the American people will not be forgotten soon.

VENTURA IS NO EXCEPTION

We are disappointed to report that 40% of the “No on Measure O” street signs that were placed in the last month have been stolen and taken down. We do not know who but we know why.

Vandalism a part of election rancor

Election rancor strikes Ventura. 40% of opposition yard signs stolen or destroyed.

It is one thing for individuals or groups of individuals to disagree with ballot measures and to make every effort to convey their message to the voters. That is what our republic is about and that is why we enjoy the right of free speech; however, those who claim “their” free speech and then deny it to others just because they disagree deserve universal contempt.

The No on Measure “O” signs will be replaced.  Regardless of how you vote we ask that if you see anyone destroying or removing political signs for any candidate or any measure that you report it to us and/or the police department.  It is a crime in this state to remove or destroy a political campaign signs.

 

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Special Interests pig out on Measure O

Special Interests Line Up For Their Share Of Measure O

“IT ISN’T WHAT WE DON’T KNOW THAT GIVES US TROUBLE, IT’S WHAT WE KNOW THAT AIN’T SO”—Will Rodgers

FEEDING AT THE PUBLIC TROUGH

The Yes on Measure O Committee reported contributions of $30,000.  Of that, over $10,000 has been spent with a public relations firm to convince you to vote yes.  (This is in addition to the $144,000 the city has already spent on consultants and a 4-color brochure). They argument has been that everything is urgent and there will be money for everyone, for everything.

Follow the money with Measure O

Follow the money contributed to Measure O. You’ll find many companies and individuals that work for the city.

Very large donors included individuals in city government. The City Manager, Mark Watkins, makes $281,000 a year and the Chief of Police, Ken Corney, $313,000 a year.  Each contributed $1,000.

Mayor Nasarenko, a public prosecutor, who announced that this tax measure would be his political legacy, also contributed $2,000.  Others included Councilman and former police chief, Mike Tracy ($1,000), Ventura Water General Manager Shana Epstein ($500) and Interim Parks and Recreation Director Nancy O’Connor ($750) and Assistant City Manager, Dan Paranick ($1,000)

Contributions from government employees are not a surprise. Those who depend on tax money for their wonderful salaries and benefits, see this tax as protecting their salaries and benefits. To do that they need more tax money.

Contributions from private special interests should also be a red flag.  John Ashkar, a developer doing business as Pacific Heritage Communities ($5,000), Toro Industries, a pavement contractor ($10,000), Tri-Counties Labor Council PAC, a labor union organization ($5,000) and Service Employees International Union Local 721 ($2,500).  These are companies and unions that feed off our tax dollars for their own benefit. They have had their snouts in the public trough for so long they make no effort to hide their self-interest.

Toro Industries does street and repair work.   They have contributed $10,000. A formal report by Public Works, called the Pavement Maintenance Plan for fiscal years 2017-2021, concludes that 70% of our streets are in good to excellent condition.  The city also plans to spend $5,240,648 in 2016 and $6,372,869 in 2017 on street repairs.  That totals over $11 million dollars, without increased taxes. One of the major arguments for Measure O has been the “urgent” need more money for street and road repairs.  This gives, at best, the perception of a conflict of interest. At its worst, this looks like an attempt to buy an election.

There are also two labor unions contributing $7,500 toward a publicity campaign to convince you to vote yes.  What possible motive could they have in contributing $7,500 to the “Yes on O” campaign?

Citizens do not get a vote on benefits and contracts. We pretend that by voting for a City Council, we have a voice in such matters.  The reality is that we do not.  If you believe otherwise ask yourself, “Why would the City Council increase the Fire Departments retirement benefits by 50% and make it retroactive to the beginning of time?”  They could have made this action effective from that moment forward but they did not. By voting as the City Council did, it created an instant $80 million dollar unfunded debt foisted on the taxpayers.

COMMON SENSE

By the time you receive this letter you will have your Voter Pamphlet and, maybe, your ballot.  How you vote on all the tax measures that will impact your family?  We suggest common sense and what is in your best interest.

CONSIDER THE FACTS WHEN YOU GO TO THE POLLS

Consider carefully the arguments in the voter pamphlet and all of the facts before you decide and ask yourself if you have doubts.  We believe that MEASURE O IS A BAD LAW and urge a no vote. Here is why:

  • Measure O is for 25 years. This is a LIFETIME. It will never expire as promised.
  • THERE ARE NO RESTRICTIONS on how this money is spent. City Councils can and will change spending at any time. This is ripe for City Council’s broken promises and having funds redirected.
  • The guarantee of a Citizens Review Committee (CRC) is a lure for the gullible. The City Council appoints the CRC and any accounting reports will be after the city spends the money.  They will not have any budget control. They will not be order the Council to pay the money back. The City Council will retain the power to appoint and spend.
  • The City doesn’t need more taxes to operate our City. The Council has a balanced budget and has stated publicly that the current revenue is sufficient to operate. We have a balanced budget.
  • They even added funds to reserves and approved 4.50% raises and $1,500 bonuses for over 270 employees making over $100,000.
  • Pigs Gorging at Measure O

    Companies that do business with the city contributed heavily to pass Measure O.

    Ventura City Council now claims everything’s “urgent”. NOT TRUE. They want another $270,000,000 tax without prioritizing.

  • Over the last 2 years, the City of Ventura’s property taxes have increased by 4.0% and sales tax revenues have increased by 9.5%. The result is in 2017; the general fund revenue will be $104 million, the highest in Ventura’s history. Reserves have also increased to $12.5 million. Given the surfeit of new tax revenue repairing streets and public safety should already have first priority, not public art or low cost subsidized housing for everyone.
  • Polls implied that funds would be for rivers, beaches and veterans. Federal, state and bond budgets pay for rivers, beaches and veterans.
  • Recently increased WATER RATES of OVER 42% fund water and wastewater issues and cash reserves over $500,000 have accumulated. In fact the Water is planning to spend $17,000,000 to replace water meters with new digital meters.  We don’t need new taxes for water infrastructure.
  • The entire city is 150 is years old but the majority of the infrastructure business and homes were built after 1950. The suggestion that because the City is 150 years old and falling apart, is pure emotional campaign rhetoric.
  • In the Voter Information Pamphlet, the City Attorney, in his Impartial Analysis, states that Measure O has the provision that ‘Suspends the tax, after notice to the State, should the State divert this revenue for State purposes’. How many times have the supporters and Mayor said ‘By law, the State cannot touch Measure O funds’? Guess they lied to us again.

MEASURE O IS AN ASSAULT ON MIDDLE INCOME FAMILIES

Up and down the state, taxpayers are the targets of tax raisers.  On local ballots this November, voters face billions of dollars in new taxes and bond measures. There are 228 local tax measures representing a cumulative tax of $3 billion per year.  That is on top of what we already pay.   Measure “O” in the City of Ventura is one of those measures.  California has the highest sales taxes of any state in the union. Also on the ballot is a ½% Transportation tax, and Ventura Unified School Board property tax.

A sales tax is regressive and it has a substantial impact on everything a family buys – clothes, cars, toys, you name it. The lower your income, the greater percentage of that income you pay in taxes. The average income for a family in the Ventura is $66,485.

If your are working 40 to 60 hours per week or are a senior citizen on a fixed retirement income, think carefully about voting for a tax increase because it will be giving local government more of your money.    Remember also that those pushing for you to pay more taxes are in a government position. 503 full time City employees receive an average pay and benefits of $103,549.  Of that number, 70 employees (13%) make over $200,000 per year and another 167 make over $150,000 per year.

THE TRUST ISSUE AND PAST SPENDING

Trust of this government is a looming question.  Do you trust this City government to effectively use your tax dollars in a prudent manner?  They have a spending problem.

In deciding on how you will vote ask yourself, what is there about a promise of future prudence and strict accountability that gives you hope that the mistakes over the last 25 years will not be repeated in the next 25 years.   As a reminder here is a list of the losses just over the last 10 years.

  • $2.5m WAV project, never repaid. $1 million of that moved from water rate payer money to the General Fund in the name of “Art”.
  • $1.0m spent on a plan to narrow Victoria. Spent then abandoned.
  • $1.2m for 911 taxes. Money collected never refunded
  • $0m diverted at the expense of the internal service funds.
  • $10.0m lost investments with Lehman and WAMU, poor City Council oversight
  • $1.2m annually for 50% fire retirement increase
  • By making The fire departments retirement retroactive to the beginning of time, this immediately increased liability to the City another $80 million dollars overnight
  • $5.0m to promote as Art City Ventura
  • $1.2m twice sold parking spaces settlement in the downtown parking structure
  • Brooks Institute lease without due diligence, losing thousand and leaving contractor with $825,000 in unpaid liens

EDITORS COMMENT

Budget surpluses and tax revenues are growing. Ventura City Government, like citizens, must live within their means. This FOREVER tax is UNACCEPTABLE. There is no legitimate reason to tax us $270,000,000 more.

Editors:

B. Alviani, K. Corse, T. Cook,  B. Berry

J. Tingstrom, R. McCord, S. Doll B. Frank

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Brooks Institute Is Ventura's Latest Failure

Remember Brooks Institute when you vote for Measure O in November

“WHEN IN DOUBT, DON’T”
—Benjamin Franklin

WAVE GOODBYE TO BROOKS INSTITUTE AND OUR TAX DOLLARS

The news in the last few weeks has reported the closure of Brooks Institute.  Everyone lost from this closure.  The students hopefully will find other institutions to complete their education and their teachers may find other positions, but the Citizens of Ventura are again holding the proverbial bag.

On August 20, 2016, The Ventura Star published an editorial about the role of city government in this matter, and it sums the situations up fairly well – “The City Council and city government appear to have given preferential treatment to a small but vocal constituency – and failed the rest of Ventura”.  We cannot improve on their conclusions except that it was all avoidable.  We can provide you with specific facts and information that we have garnered thus far so that when the bureaucratic spinning and finger pointing starts, you will be able to see it for what it is.

In February the City announced with great elation and fanfare that Brooks was coming to town. Councilwoman Heitmann led the parade as well as the City Economic Development Manager, Leigh Eisen. They extolled the prospects of increased revenue for the city and that downtown business would flourish.  Same hype surrounded the WAV (See our August 2011 letter published at August 2011 Newsletter).

Brooks Institute Unfinished Office Space

Brooks Institute left unfinished classroom space when the deal unraveled.

There were three sites leased, two private owner locations downtown and one behind City Hall.  The largest was the two top floors of a 5-story city office building at 505 Poli just behind City Hall.   There may have been two other private owner locations but that as yet has not been established.

Hope and promise filled City government.   Staff rushed to execute leases for the 505 Poli property.   Brooks Institute entered into a contract with a major contractor to demolish and build tenant improvements on the two top floors of 505 Poli at a contract price of $1.2 million. Tenants of those two floors were evicted; the contractor was permitted to fast track demolition and tenant improvements started.  When hazardous materials were found on site Building & Safety again fast tracked the work, which was promptly completed by Venterra, a hazardous materials remediation company, at an additional cost of $80,000.  Demolition was completed and 2/3 of the tenant improvements were built.  Then Brooks closed its doors and the project imploded.

THE PROJECT UNRAVELS

Brooks Institute paid no money to the City for rent, no money for a security deposit and no performance bonds or guarantees were put in place.  Reportedly $70,000 in back rent is due. Future rents are lost. The tenant improvements have yet to be completed. The Assistant City Manager tells us that it will only cost our City $200,000 to complete those improvements.

Unsurprisingly, within a matter of days, the facts have proven otherwise.  The contractor has filed a lien against the City for $825,000 for the work they and the subcontractors performed on City property, including the $80,000 cost of the removal of the hazardous materials.  Add lost rent to date, future lost rents the evicted tenants would have paid, the estimated cost to complete the tenant improvements and the damages causing the losses to swell to over $1.2 million.  Then there will be the legal costs to collect these losses, if possible, and to avoid liability.

The private property owner who also signed Brooks’ leases and started the work of providing tenant improvements in the downtown area was more fortunate.  He wisely obtained guarantees to protect himself.  Brooks Institute, owned by a Chinese owned company named Gphomestay, has lawyered up with an expensive LA firm. The contractor has lawyered up too but no word yet on what lawyer will try to pull the City’s chestnuts out of the fire.

The citizens of Ventura deserve to know why the taxpayer has once again been “hornswoggled[1]“.  Dreams, hopes and ideas for healthy economic growth are wonderful, but such things must be tempered with economic reality and good business sense.  When those are ignored the phrase “a fool and his money are soon parted” is apropos.

DEMAND THE TRUTH

The City Council has a lot to explain.  They were quick to ask the citizens of Ventura to increase taxes (Measure “O”).  They spent $118,000 of our tax money to hire public relations firms to convince 51% of the voters to vote yes on that measure thereby giving them more of our money.  Will they be as quick to take responsibility for another $1 million plus dollar loss?

No Deposit on Brooks Institute

Citizens should ask, “Who approved the Brooks Institute lease without asking for rent payments upon execution?”

This Council, particularly the two candidates seeking reelection in November, Councilwomen Weir and Heitmann, need to answer questions about their ability to conduct business on our behalf.  We must have representatives that are experienced and understand business. We, as a community, cannot afford losses of this magnitude and we certainly should not be handing the City Council another $270,000,000 over the next 25 years if they are not qualified.  By this recent action, this City Council is not capable of managing our tax money.

Other than “what were they thinking” here are questions EVERY citizen should be asking?

  1. Who approved this lease without asking for rent payments upon execution?
  2. Who reviewed and approved the terms of the lease with Brooks?
  3. Who made the decision to permit construction on City property  without a guarantee or performance bond in the event of default of Brooks Institute?
  4. Who performed the due diligence and examined the financial condition of Brooks Institute to determine their ability to perform under the terms of the lease?
  5. Who recommended the approval of this lease and its terms to the city Council?
  6. Shouldn’t those who made the decisions in this matter resign or be fired?

City Government’s response thus far is that they will sue Brooks to get our money. City officials continue to say they are surprised, shocked and disappointed. They should not be any of these things. This was all foreseeable based upon the financial condition and history of Brooks Institute. 

VREG is continuing to investigate this transaction and will report our findings in subsequent issues as new facts are discovered.

EDITORS COMMENT

In the private sector, when a so-called “good deal” goes bad for lack of due diligence people lose their jobs. In the public sector, nobody is held accountable and elected officials either choose not to run again, or they run and look for a fall guy.  

Just keep the BROOKS project in mind when you are asked to vote for Measure “O” in November; and, when voting to fill the three City Council seats that are open ask yourself if they are truly qualified.

Editors:

B. Alviani       K. Corse          T. Cook         B. Frank

J. Tingstrom R. McCord       S. Doll          C. Kistner

 

[1]Hornswoggle”, slang circa 1829.  A word to describe one who has been bamboozled.  Synonyms: dupe, fake out, fool, hoodwink, deceive, humbug, juggle, misguide, misinform, mislead, snooker, snow, spoof, string along, sucker, suck in, take in, trick

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Ventura Wants More Taxes

Ventura City Council Asks For More Taxes. Why You Should Say No.

“THE ART OF TAXATION CONSISTS IN SO PLUCKINJG THE GOOSE AS TO GET THE MOST FEATHERS WITH THE LEAST HISSING”
—Jean Baptist Colbert

VENTURA CITY COUNCIL ASKS CITIZENS FOR MORE TAXES

On May 23, 2016, the Ventura City Council joined a parade of governments hoping to persuade voters to raise the sales tax, and last week, in a 6 to 1 decision, the Council voted to place a measure on the November 2016 ballot to raise the Ventura sales tax by 1/2 %. Councilman James Monahan voted against the measure.

As adopted the increase would:(1) produce an additional $10.8 million per year; (2) sunset in 25 years; (2) be subject to an citizens oversight committee; (3) be subject to an annual audit, and (4) be used to ” maintain essential services”.  Over the 25 year period citizens would pay another $270,000,000 above what they are already paying.

Greedy pig with more taxes

Ventura jumps at the chance for more taxes.

In asking the Council to adopt the measure the City Manager, Mark Watkins commented that “we have recovered from the recession.  For the First time we have reserves which exceed those that we had prior to the recession”.  Notwithstanding the recovery he asked the Council to approve a ballot measure to ask voters to increase our sales tax by 1/2 cent.

Supervisor Bennett addressed the council, purportedly as a citizen and not as a member of the Board of Supervisors or the Ventura County Transportation Board.  He opposed this sales tax measure for the November election and asked the council not to put the matter on the ballot for another 2 years because it would be in competition with his County 1/2 cent transportation sales tax and the Ventura School District tax that will again be on the November ballot.  His concern is that the voters would be confused.

THE ILLUSION OF CITIZEN OVERSIGHT

In return for more taxes, Ventura offers a citizens’ oversight committee.

The City Manager and Mayor Nasarenko, in their effort to seek approval by the voters, are quick to point out that this new tax money will be subject to a citizen’s oversight committee.  The question for voters is whether this oversight committee idea is a substantive proposal or an illusory and hollow effort to inveigle as yes vote from 51% of our voters.

During the May 23rd meeting citizens Mr. Ron Baker and Ms. Allison Carlson expressed the sentiment many others feel about such a proposal.  Mr. Bakers said “Instead of promises and assurances on how this (tax) money is spent, I want to see evidence”.

Ms. Carlson voiced that such a tax should only be a last resort then came right to the question most people are asking.   She wanted to know just how the citizen’s oversight committee would be appointed and how it would work:

“who are these people, who are they going to be, who approves them and puts them on the committee. If it is the City Council I would suggest that they have a conflict of interest.  I want to know it will not be a rubber stamp committee, and want to make sure there are watchdogs on the committee and I want to know that the committee oversight happens before the money is spent.  It is not fair for the City to spend the money first and then say this is how we spent the money.”

At the end of the hearing the Councilman Morehouse asked the same the City Manager how the committee would be appointed and how it would work.  His response was that THE COUNCIL should appoint the people to the citizens committee, THE COUNCIL should decide how the money was to be spent and THE COUNCIL should not place any limitations on how THE COUNCIL proposes to spend the new tax money.

After a pregnant pause the council members said nothing then proceeded to vote in favor of the City Manager preparing a 1/2% sales tax measure for the November ballot.

IMPACT ON THE AVERAGE MIDDLE CLASS FAMILY

Prior to voting in favor of the new tax Councilman Morehouse, observed that “a sales tax is regressive and it does intend to impact those who are poorer and we have a lot of elderly people who have fixed incomes”.  He is correct.

More taxes hurt struggling families

More taxes on Ventura’s Middle Class hurts struggling families.

Such taxes are imposed on everything that a family will buy to maintain their standard of living except food and prescriptions at the market.  The lower your income the higher the percentage of that income the family must pay in tax. According to statistics published by the Federal Reserve 47% of Americans cannot scrape enough money together to pay for an unexpected $400 emergency. Statistically than means 53,221 of our citizens do not have that amount of money.

This City Council advertises that this new tax will only cost the average family an additional $170 per year.  To make that statement they must assume that the average family will spend $34,000 per year on all purchases such as clothes, mobile phones, restaurants and widgets. , which if taxed at the 7.25% , will cost $2,465 a year.  If the tax is increased by 1/2 % the new tax would be 7.75%.  That will cost a family $2,635. per year.

Now consider the gauntlet of other increased taxes and cost: (1) water rate increase of 18.5% in July; (2) Medicare deduction increase of 0.9% (3) payroll tax increase from 37.4% to 52.2%; (4) income tax increase of 4.6% (5) Ventura County Transportation ales tax of 1/2%, and (6) $59 annual tax from the Ventura School District.

Footnote: In 2012 Proposition 30 was passed increasing the sales tax by 1/4% to 7.5% for 4 years. This increase is scheduled to terminate in November, 2016.  There is now an initiative in progress to extend all of part of that tax measure. Unless extended the State tax rate will revert to 7.25%.

The voters in Ventura need to pay special attention when it comes time to vote in November and remember that every dollar a family has to pay in taxes to the government is less they will have to support their family.

IS THE TAX EVEN NEEDED?

Does our city government “need” the additional money from the sales tax increase to provide the essential functions of government?

Consider how Ventura’s General Fund compares to the General Funds of other cities in the County and how much of those funds
are spent for each citizen.  Ventura has the second highest per capita amount to spend on its citizens. Only Ojai is higher.

 

General Fund Population Per Citizen
Ventura  $93,926,316.00  106,443  $861.49
Ojai *  $8,668,900.00  7,461  $1,161.89
Port Hueneme  $16,125,866.00  21,723  $742.34
Thousand Oaks  $76,933,217.00  126,683  $607.29
Oxnard  $118,110,062.00  197,899  $596.82
Camarillo  $34,000,000.00  65,201  $521.46
Simi Valley  $63,646,200.00  124,237  $512.30
Moorpark  $17,329,940.00  34,421  $503.47
Fillmore  $7,261,045.00  15,002  $484.01
Santa Paula  $14,086,725.00  29,321  $480.43

 

*  City of Ojai receives a “significant” amount of its revenue from the TOT taxes paid by the Ojai Valley Inn.

Other cities in the county have less money to spend, in general, and significantly less money to spend per person than Ventura. Those cities provide for police, fire, streets and operational costs with the money they have. The Ventura City Council claims it does not have enough.  Councilwoman Weir’s comment is telling:

“We are able with our growing revenue to pay some of our costs but the big projects, like our promenade, our sidewalks and our shoreline that are multi-million dollar projects, we just don’t have the money”

If approved and the sales tax projections prove to be generally accurate the City of Ventura, for the first time in its history would have general revenue income of $103,926,000.  Each of the seven Council members have a different set of priorities but here is a summary and result  of the “group think” called City of Ventura Community Investment Spending Plan for the next 25 years, not including water/wastewater costs.

45% to programs and services              $167,160,000.
30% to infrastructure maintenance           111,440,000
25% to capital and infrastructure               92,867,000
Other estimated revenue for capital         190,773,000
Total                                               $562,240,000

VREG COMMITTEE MEMBERS COMMENTS

A Politician’s promise of how they will spend new tax money, given a 25 year history of their wasting millions in tax dollars on foolish projects and ventures, is just that – a hollow and meaningless promise.

Without a guarantee of the appointment of an independent citizen’s oversight committee on how this new tax money will be spent voters should not approve this tax measure in November.

VREG Committee:

R. Alviani,     K. Corse,   T. Cook, R. Berry,
J. Tingstrom, R. McCord, S. Doll, C. Kistner, W. Frank

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No Sales Tax Increase, Live Within Your Means

Pet Projects Cloud Ventura City Council’s Push For A Sales Tax Increase

Spending Problem

“We don’t have a revenue problem, we have a spending problem.” — Ronald Reagan

The Scenario

The Ventura City Council is determined to raise taxes again by putting a measure on the ballot in November to increase sales taxes by 0.5%-1%. Two previous attempts failed. As is customary, they are not completely forthcoming or transparent when they are trying to extract more money from the citizenry. On January 30, 2016, the City Council held a special meeting at the Ventura Police Department whose true purpose was to discuss raising the sales tax. The Council spent $118,000 to hire consultants to sell the voters on a tax increase. What they learned should have disappointed the Council.

These Councilmembers are pushing hard to put a sales tax increase on November’s ballot.

Confusing Messages From City Councilmen About The Sales Tax Increase

At the January 30th meeting, Deputy Mayor Andrews commented that we are currently in an economic downturn, which is exactly the right time when we as a City should be increasing capital spending.  His comment left many in the audience puzzled. If this is indeed an economic downturn, the last thing the average taxpayer wants to do is pay more taxes. More taxes reduce their ability to pay rent or their mortgage. It cuts into their food budget, their travel and vacation capability, their medical care and their own future retirement.

Mayor Nasarenko is campaigning on the premise that Ventura voters will support a locally kept and locally spent tax. He fails to understand, however, that $340 more out of a household budget is still $340, regardless of where and how it is spent. ($340 is City Council’s estimate of how much more each household will pay annually if the sales tax is increased 1%)

Both the Mayor and Deputy Mayor are ignoring nearby failures of sales tax increases, too. Neighboring Oxnard and Port Hueneme increased their sales taxes and they’re still having budget problems. Politicians in those cities failed to realize it is a spending problem, not a revenue problem. Now, Ventura’s politicians are blindly walking down the same path.

Let’s Not Forget Each Councilmember’s Pet Projects

Deputy Mayor Andrews was adamant at the January 30th meeting that Ventura needs more assistance and housing for the “homeless.” Who falls into this category was not defined which leaves it open to interpretation by city officials. It is a fair assumption, though, that one would be able to identify the beneficiaries of his largess by walking down the street. Nothing prevents spending these taxes on any special project such as this once the money goes into the General Fund.

Councilman Morehouse announced last year during a public session that a sales tax increase would just scratch the surface.  Both he and Councilwoman Weir consistently argue that an increase in the sales taxes is just a start, and that Ventura, like other cities, should also be seeking more taxes for:

  • Median maintenance tax
  • Lighting district tax
  • Fire district tax
  • Recreation district tax
  • Library tax

MORE TAXES – THE BIG PICTURE

[PENURY BY THE PENNY]

A sales tax increase is not an isolated event. To understand the full impact of the tax burden on Venturans, one must consider all the other tax increases facing voters.

The Ventura School District tax, approved in 2012, is up for renewal in 2016. Governor Brown’s “temporary” sales tax increase is also up for renewal. And, Ventura County Transportation Commission is considering a sales tax, countywide.

Then consider other recent tax increases:

Medicare tax went from 1.45% to 2.35%

Income Tax rate went from 35% to 39.6%

Payroll tax went from 37.4% to 52.2%

Capital gain tax went from 15% to 28%

Dividend tax went from 15% to 39.6%

Estate taxes went from 0% to 55%

Real Estate transaction tax of 3.5% was added

There’s An Alternative Plan The City Council Refuses To Consider

Our City government has $20 million more in real property taxes and sales taxes. Add to that the 34% water rate increase, imposed without your affirmative vote, to raise millions to fund and replace the water and wastewater infrastructure under our streets, it becomes clear that city government has enough money.

Our current City Council wants more tax money, calling for citizens to “invest” more of “your money.”  Ask yourself first how they have invested “your money” over the last 8 years, and the answer unequivocally — poorly.  How about showing us first how they manage the tax money they have before demanding more.

If you agree that Ventura should live within its existing budget, then write to your City Councilmembers to say so. Tell them not to tax Ventura citizens any more and to spend the money they have more wisely.

Click On A Councilmember’s Photo To Send Them An Email

Erik Nasarenko,
Mayor

Neal Andrews,
Deputy Mayor

Cheryl Heitmann

Jim Monahan

Carl Morehouse

Mike Tracy

Christy Weir

Editors:

R. Alviani,       K. Corse,     T. Cook,     R. Berry,
J. Tingstrom, R. McCord,  S. Doll,      C. Kistner,
W. Frank

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High Priced Consultants Selling Snake Oil

City Council Hires Consultants To “Sell” Voters On A Tax Hike

Spending Problem

“We don’t have a revenue problem, we have a spending problem.” — Ronald Reagan

The Scenario

The Ventura City Council is determined to raise taxes again by putting a measure on the ballot in November to increase sales taxes by 0.5%-1%. Two previous attempts failed. As is customary, they are not completely forthcoming or transparent when they are trying to extract more money from the citizenry. On January 30, 2016, the City Council held a special meeting at the Ventura Police Department whose true purpose was to discuss raising the sales tax. The Council spent $118,000 to hire consultants to sell the voters on a tax increase. What they learned should have disappointed the Council.

This City Council is pushing hard for a sales tax incease.

Council hired consultants to direct them on how to sell the voters on a tax increase

 [Only 36% say Yes]

At the January 30th meeting, one paid consultant provided his interpretation of the results of a general poll on citizen’s views asked of 630 citizens. The opinions were favorable in such areas as police, fire, beaches, water, paving streets, serving veterans, and protecting the environment.

When it came to answering two questions specifically focused on the need for a sales tax increase, however, the results were remarkably different.

Question:  Does the City need additional funds for City Services?

Great need = 22%

Some need = 38%

Little/no need = 30%

Question:   If on an initial ballot you were asked to increase sales taxes by one-percent or one-half percent how would you vote?

One-percent                                                one-half percent

Definitely yes = 36%                         Definitely yes = 33%

Probably yes – 12%                           Probably yes = 22%

No/probable no = 39%                     No/probable no = 31%

Interpreting the results, fewer than one in four citizens sees a great need for additional funds and only 36% would vote definitely yes for a 1% sales tax increase.

If 630 citizens surveyed believe the City is doing a favorable job with the funds they have and only 22% believe there’s a great need for additional funds, one might conclude the citizens are content with the current situation.  But, the City Council—strongly encouraged by the consultants—continued to push the sales tax increase forward.

The inference is that voters are not smart and need to be led around

expensive consultants

Ventura spends $118,000 on consultants to “sell” voters on sales tax increase

The pollster then advised the Council that they needed to do more to “educate” the people on why they should vote for a sales tax increase to receive approval.  Without education it was a close call.  His words were – “on the one-percent measure you might have a shot.” One council member commented that the “citizens just don’t understand.”

Next, the paid political consultant outlined that of the 109,000 Ventura residents only 24,000 vote and, of that number, 61% are over the age of 50. It was his view that an intense program was needed to “educate” voters because “they need to know what the city council is going to use the money for.”

In fact, that’s the crux of the issue. If the additional sales tax revenue goes into the General Fund, nobody will know for sure how the City Council will use the money.

MONEY FOR EVERYONE AND EVERYTHING

[The Ventura Essential Services Tax Measure]

At the conclusion of the presentation, Mayor Nasarenko announced, “I have made a sales tax measure a core goal for my year as the Mayor.  I have been joined by the Deputy Mayor [Neal Andrews].”

The discussion then moved to a staff report that listed “all of the needs.”  The list of needs total $1.368 billion. That is billion with a “B.” Excluding costs for Water and Wastewater totaling $661,120,000, which the citizens will pay through a 34% increase in water bills the City Council approved in 2015, which leaves $707,734,532 in needs for the General Fund.

Here are some examples of what’s on the City of Ventura government’s shopping list. It is obvious the city council wants to overwhelm the voters with the sizable need for more taxes.

Community Enhancement $199,360,000
Technology $7,420,000
Streets $298,999,747
Public Art $557,462
Parks $112,192,823
Facilities $42,087,500
Fire $3,400,000
Police $4,853,000

This wish list illustrates the consultants’ concern about Ventura citizens, “they need to know what the city council is going to use the money for.”   But, here’s the rub.

As a General Fund Tax Measure, it is impossible to promise or earmark the new tax revenue to any specific project. To earmark funds requires a two-thirds majority vote (67%) on the ballot. To vote in a General Fund Tax Measure requires a simple majority (>50%).

Given the low interest in approving a sales tax increase cited in the survey (36%, at best), reaching a two-thirds majority will be a struggle. A simple majority seems more likely, if the sales tax increase is to pass at all.

Once in the General Fund, the City Council can spend the sales tax revenue as they choose.

No oversight committee, appointed by the city, has ever challenged spending after it has been spent

Mayor Nasarenko isn’t telling voters that no guarantee exists for the City to spend the additional tax revenue on any of the City needs once the tax receipts go into the General Fund. This Council may intend to use the funds for the projects outlined above, but Councilmembers change, city priorities change and needs change with time. In 2007-08 the signs of an economic downturn were clear yet the City government forged ahead, spending money on experts and projects as if they were immune from economic reality. Who’s to say the City won’t syphon off money intended for street repair to pay for another WAV building, for instance?

Consultants oversight committee

Consultants suggest a citizen’s oversight committee

So, the mayor is creating a smoke screen in his “let’s increase taxes” pitch by promising a Citizen’s Oversight Committee intended to give voters the false sense that “how funds are spent” will be closely monitored.

To monitor the funds that closely, however, a Citizen’s Oversight Committee would have to approve any project expenditure before the City makes it—effectively neutering the Council. It’s unlikely the City Council would approve that. And, even if they did, why would we need a City Council at all if this committee controlled the purse strings?

The truth is no post audit Citizen’s Oversight Committee will track city spending that closely, let alone have the power to reverse any spending after the fact. Once the Sales Tax Increase passes, the fact is nobody will look at it again and nobody will reverse any expenditure.

If you believe a sales tax increase will be spent unwisely, raise your voice. Write to the City Council to share your opinion. In addition, insist Council Members Heitmann, Morehouse and Weir—all up for re-election in the November 2016—thoroughly explain their position on the sales tax increase.  After all, they have a balanced budget, they increased water rates by 34% and they have revenues up $20 million to pre-2008 levels.

Click On The Councilmember’s Photo Below To Send An Email

Erik Nasarenko,
Mayor

Neal Andrews,
Deputy Mayor

Cheryl Heitmann

Jim Monahan

Carl Morehouse

Mike Tracy

Christy Weir

Editors:

R. Alviani,       K. Corse,     T. Cook,     R. Berry,
J. Tingstrom, R. McCord,  S. Doll,      C. Kistner,
W. Frank

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