Redevelopment Update

Poway Blog has been on a bit of a hiatus while I attended to some family matters. But that doesn't mean that nothing has been going on during the last few months or that I haven't been paying attention.

One of my special areas of concern has been, and continues to be, redevelopment. As many of you may know, redevelopment plays a major role in many land use and budget decisions in Poway. It also has a huge impact on school financing and the state budget. Last January, newly elected Gov. Jerry Brown proposed eliminating redevelopment agencies in California. This kind of blew me away. I had been a critic of redevelopment for many years. I even wrote a letter to Arnold and sent it to him and all of the state legislators in June, 2009, suggesting that Arnold grab some money from the magical redevelopment agencies to balance the state budget. But I never dreamt that anyone would call for the demise of the goose that kept laying those golden redevelopment eggs.

Brown's plan to snuff out redevelopment agencies met a lot of resistance. With a few rare exceptions, GOP legislators were opposed, although technically. redevelopment doesn't line up with their supposed "values". Redevelopment is big government, intrusive government, secret government, with the power of eminent domain and, um, did I mention the excessive borrowing aka deficit spending ? There were also a few Democrats who couldn't really sign off on ending redevelopment, so the California legislature devised a way for redevelopment agencies to rise from the ashes and continue to borrow money and spend it on development projects. The catch was that they had to give billions of dollars to the local schools and local agencies, like fire departments, that are funded with property taxes. Considering that redevelopment agencies have stolen diverted billions of property tax dollars from schools for years, it seemed a pretty reasonable compromise. But the redevelopment agencies wanted it all. They went for broke. They sued the state.

Both the redevelopment agencies and the state agreed to have the case go directly to the state's supreme court. The court has agreed to decide the case before January 15th, when the first batch of payments from the redevelopment agencies are due to be turned over to a local authority that will distribute the money to local schools and special districts.

On October 10th, the California Supreme Court heard oral arguments in the case which is named CRA v Matosantos. The amicus briefs for each side are posted on the CRA's website. The ones that support the redevelopment agencies, claiming that the state cannot dissolve them or reconstitute them for a ransom, are: Association of California Cities, Orange County; City of Irvine; Long Beach; Public Interest Law Western Center, San Bernardino County, Southern California Coalition, CRA/LA, Riverside County and ABAG (Association of Bay Area Governments). With the exception of the Public Interest Law Western Center, each of these is, has, or represents a redevelopment agency.

The groups that filed amicus briefs in support of the state's position are: Affordable Housing Advocates (a San Diego group that advocates for affordable housing); California Professional Firefighters; Center for Constitutional Jurisprudence (an Orange County group from Chapman Univ School of Law); California Teachers Association; Los Angeles USD; MORR- Chris Norby, and Santa Clara USD. The groups supporting the state's position represent school districts, firefighters, affordable housing advocates, the Center for Constitutional Jurisprudence (a conservative group concerned about the abuse of eminent domain) and MORR (Municipal Officials for Redevelopment Reform).

The redevelopment agencies sued the state , claiming that both ABx-26 which dissolved redevelopment agencies and ABx-27, which allowed for the new alternative redevelopment agencies that voluntarily paid a ransom to the local schools, were unconstitutional. They claimed that the voters passed Prop 22, which forbids the state from grabbing any of their redevelopment money. From the comments at the supreme court hearing, it appears that the justices seem to lean toward the position that the state has the right to abolish redevelopment agencies, that ABx-26 is constitutional.

The question then becomes, "Is ABx-27 constitutional - can the state make the redevelopment agencies give a share of their diverted property taxes to the schools in order to continue to exist?" If the answer is yes, then the redevelopment agencies lose and the state wins the case. But what if the courts find ABx27 unconstitutional? This is where it gets really interesting.

Justice Joyce L. Kennard suggested that the agencies' challenge of both laws could backfire. She said the court could find the abolition constitutional but the revenue-sharing law invalid, a prospect that an attorney for redevelopment agencies called the worst possible outcome.

If the court finds ABx-27 unconstitutional, then everything would revert back to ABx-26 and the redevelopment agencies would all be dissolved. Redevelopment in California would be no more. And it would be because of this court case and Prop 22, a sneaky voter initiative that redevelopment agencies pushed to get on the ballot and passed in 2010.

Justice Marvin R. Baxter observed that it would be ironic if Proposition 22, which redevelopment agencies had promoted, ended up requiring the court to overturn the compromise and cut the lifeline that the revenue-sharing law provided. Baxter also appeared dubious that the proposition gave the agencies "perpetual existence."

Deputy Atty. Gen. Ross C. Moody, representing the state, agreed that the agencies may have miscalculated in suing to overturn both measures.

"The redevelopment agencies took a gamble on this lawsuit," Moody said

Remember, the redevelopment agencies did not have to file this lawsuit. They chose to. They are not accepting the lose, lose position. Redevelopment agencies are now arguing that ABx-26 and ABx-27 cannot be considered separately, that they are intricately woven together.

The back-and-forth in the San Francisco courtroom seemed to hint that the justices are grappling less with whether the Legislature has the power to abolish RDAs -- a power that the Court seems poised to uphold -- and more with whether the budget provisions that dissolve and then reconstitute RDAs are, as the attorney for the locals argued, "joined at the hip."

The redevelopment agencies are now arguing that comments from some legislators indicated that they only voted for ABx-26 because there was also an ABx-27. Therefore, if either one is unconstitutional, they both are. But that argument seems particularly weak, since the laws actually say that they are separate.

Legislators wrote language stating the two are separable -- a point raised in a pointed exchange led by Justice Goodwin Liu. "How could it be any clearer?" said Liu after reading the relevant passage from the legislation.

This is all good news, hopeful news, for redevelopment watchers. The sad part is that the taxpayers are paying for both sides of this court case. The sadder part is that all 5 of Poway's council members strongly support the redevelopment agencies' case and the diversion of property tax funds from PUSD and special districts.

The California Supreme Court expects to rule on the constitutionality of ABx26 and ABx27 by mid-January 2012.

Next Up: Lowe's

I don't think anyone ever envisioned warehouse stores being built on Poway Rd when we incorporated back in 1980. In fact, when the General Plan was approved in 1983, it didn't say anything about giant big box stores or warehouse stores. The General Plan has been amended a couple of times per year since then, with most of the changes adversely affecting south Poway, but there are still no development standards for warehouse stores on Poway Rd. in our plan or our municipal code.

Nevertheless, the council just approved expanding Wal-Mart into a superstore and next Tuesday, the council will approve the Lowe's warehouse building on Poway Rd. There might be a few residents yammering away about nightmare traffic and noise, but it won't matter. It is a done deal. Was a done deal before anyone even heard about it.

Even after blowing off noise and traffic as nonexistent "monsters under the bed", there are still some glaring nonconformance issues that have to be addressed. Sort of. There will have to be some tweaking of the rules . The building height limit is 35 feet in Poway. Thirty-five feet or 2-stories, whichever is less. The General Plan was amended in the last few years to provide 2 exceptions. One was to allow a 3-story hotel in the business park. And another was to allow 3 stories for affordable housing projects. Commercial buildings don't have an exception. Except for something called an "architectural feature".

Look at the picture of Lowes in the drawing at the top of the blog. See that extra roof that looks like a doghouse or an outpost in a stockade? The staff suggests giving Lowes almost 10 extra feet for that. They are calling it an "architectural feature". Now look at the picture again. Visually remove the architectural feature. Guess what, the building is still over 35 feet high. Click on the enhanced picture from the staff report below. The blue line is at approximately 35 ft. Both of the roofs above the word "Lowes" exceed the city's 35 ft limit, as do the other 2 peaked roofs. I always thought of architectural features as something like a church steeples. I guess you can build over 35 ft. in Poway now if you have a peaked roof.

That's not the only cheating on our standards that the staff had to do for Lowe's. Lowe's proposed signs are too big for our codes. So, they came up with a newfangled way to measure the size of the sign. They are going to only measure the space in the letters in the word Lowe's and not count the white space around the letters. With this little adjustment, they will be just under the limit.

Oh, and Poway's sign ordinance limits the height of the signs to 8 ft, but the city is going to let Lowe's have theirs go to 15 ft because Walmart has one there will be so much traffic in the area, it might obscure a lower sign. This is a special exemption, just for Lowe's, because there is no traffic going into any other commercial businesses, right?

As you might expect, the Lowe's project is actually going to improve traffic in the area, according to the staff report. Yeah, I want some of what they're smoking, too. The report says that the traffic at Poway and Gate Dr is now LOS "F". After installing a new traffic light at Gate Dr and the extension of the left turn lane at Poway & Community Rd, the LOS at Poway &Gate Dr will improve to LOS "C" by 2030, even with all of the new Wal-Mart and Lowe's traffic. Don't forget, the city is now using new traffic LOS designations. What was once considered a failing grade, is now a passing grade.

The staff report also says that the Lowe's building "has been designed to comply with the Poway Road Specific Plan standards". Unlike our traffic standards, the Poway Road Specific Plan hasn't been dumbed down as far as I know. It didn't take me anymore than a minute or two of skimming through the Poway Road Specific Plan (PRSP) to question whether Lowe's plans are compliant.

Chapter 5 of the PRSP list some design guidelines. Some of them are kind of squishy. For example, under Architecture, the PRSP says:

Building mass, height and pad elevation should be comparable to and complement that of surrounding structures.

"Comparable" and "complement" allow a lot of wiggle room for interpretation. I don't think a humongous warehouse is comparable to or complements any of the other businesses on Poway Rd. But that's just me. Other guidelines are less subjective:

Rear and side facades should be designed to be consistent with the architectural style of the building and the design of the primary facade.

Lowe's rear and sides are not consistent with the front. It is a basic butt-ugly warehouse in the back and sides. Even before clicking on the picture below, you can see that Lowe's back isn't anything like their front which is pictured above.

Here's another design guideline from the PRSP:

The parking lot should not be the dominant feature of the site. Large expansive paved areas located between the street and buildings are to be avoided.

Hmmm...did our planners read the PRSP before submitting this? But to be fair, Lowe's is going to sell stuff from the parking lot. Kind of break up the expanse with lumber and plants and seasonal stuff and whatnot. I am sure it will have the look and feel of an open market.

And another:

The first parking stall which is perpendicular to a driveway or first aisle juncture should be at least 40 feet back from the public street curb. With larger centers, significantly more setback areas may be required for vehicle stacking and the ability to create secondary accessways with adjoining properties.

The Lowe's project will have a 20 foot-wide landscaped setback along Poway Rd. The rest of it will be packed with cars, both parallel and perpendicular to entrance driveways, aisle junctures and each other.

The PRSP was written in 1996. There are 91 pages in the plan and the word "warehouse" appears "0" times. The PRSP mentions a lot of nice things for Poway Rd, like bicycle and pedestrian friendly access and covered walkways and open space and "gathering places" and a "town center". So, how did we end up with a Super Wal-Mart and a Lowe's?

Last week, Bob Emery, who sat on the council for over a quarter of a century, voiced his opinions about the Wal-Mart expansion approval process and the opponent's concerns.

Most of the hullabaloo from the opposition concerned traffic and impacts on businesses. "It will hurt other local markets in the area." Excuse me? If detractors are worried about "little Vons," which is part of the safeway empire of nearly 2,000 stores, let's be realistic. We live under a free enterprise system based on competition and some make it and some don't. As for traffic, I would rather see our streets jammed with shoppers spending money in Poway so we can pave streets, maintain our parks, fight fires and crime and provide other essential community services. .....

Finally, just across town, the Target store is adding several thousand square feet to its store so it can also go into the grocery business but there hasn't been a peep out of anyone. Target practices the same dubious hirting practices and right-wing bullying as Walmart but no one seems to care. What about the impact on that "ma and pa" store next door called Albertsons? Go figure.

I want to remind people that Prop FF was Bob Emery's baby. Prop FF was the 1988 ballot initiative that makes it mandatory to get voter approval to increase the density or to build a single store on any land zoned rural residential in Poway. After Emery got the quality of life in his neighborhood protected, he pretty much didn't give a damn what happened to folks in south Poway.

I am going to spell it out for him and others who don't understand. Not that they will "get it". But it is important to set the record straight. I've lived in Poway for over 35 years. People have been complaining about traffic on Poway Rd. for most of that time. For years and years, councilmembers and the city manager complained about all the folks from Ramona driving up and down Poway Rd. The city's redevelopment agency spent lots of money (that I do not believe is paid off yet) to build Scripps Poway Parkway in the undeveloped hills of south Poway, so we could have some employment opportunities and to get the damn Ramonans off of Poway Rd.

And now the city is getting a super big-box store and a warehouse store, two ventures that will bring a great deal of regional traffic to Poway Road. Poway Rd is a miles-long commercial corridor that is also the access point for many residential neighborhoods. It ends in what is essentially a cul-de-sac, with an offshoot to the nearby community of Ramona. It doesn't take a PhD in planning to know that the best place to site regional shopping ventures is on the periphery of the community, as close to freeway offramps as possible. So the reason people are not complaining about Target expanding and selling food is because the Target center was better located and designed to handle the traffic and noise and truck deliveries.

Poway Rd commercial properties don't have the depth that the Target center has. Many butt right up next to residential areas. There are no apartment houses that face Target. It is amazing that the same people who found it incompatible to have even a neighborhood shopping center anywhere near their homes would be so supportive of a 24-hr regional shopping center and warehouse store adjacent to or across the street from someone else's. Yes, we need sales tax to support needed services. But the people who approved the Wal-Mart expansion and will approve Lowe's are not sacrificing their quality of life; they are taking someone else's.

And about that free enterprise stuff. I'm not buying it. The city gave Wal-Mart almost a million dollars to locate in Poway. And they just robbed our sewer fund of $3 million to move Toyota across the street so that Lowe's could fit into Toyota's old spot. It wasn't done out in the open or by selling the property to the highest bidder. It was all planned and executed behind closed doors with an exclusive negotiated agreement. That is not how a free enterprise system based on competition works.

The expanded Wal-Mart has been approved. Lowe's will be approved. I'm sure they will bring in some sales tax dollars. Not that Poway isn't already capturing more than their share of per capita sales taxes revenue compared to other California cities. But it is never enough, is it?

Monsters Under The Bed

h/t to Joe and MaryLou St Lucas for the Poway Monsters Under The Bed Video

Last Tuesday night, the Poway City Council met to approve the Wal-Mart expansion. We arrived a bit late but didn't really have to worry about parking, 'cause we knew there would be plenty of room at the empty Dixieline shopping center.

The meeting was crowded. All of the seats in the main chamber were taken. One side of the chamber seemed to be filled with Wal-Mart employees. Made me wonder if they would lose their job if they didn't show up. The lobby was also full; standing room only. We found some outside seats in front of 2 TV screens on the side of the building. Might have been the best seats available. We got to see the speakers as the council saw them, instead of from their backs. And we got some fresh air instead of the stench of divisiveness.

There were some articulate, thoughtful speakers from the "No We" group who presented their concerns about traffic, parking, aesthetics and noise, especially nighttime noise from delivery trucks. There were also a couple of passionate out-of-towners who begged the council to approve the Wal-Mart expansion so they could one-stop shop at Wal-Mart. They promised that the benefits of one-stop shopping at Wal-Mart would ripple through the business community. Another pro-expansion guy got up and complained because Joe St. Lucas, president of the 800 member No-We group, spoke for 5 minutes (with permission). He then proceeded to single out each anti-expansion speaker and say they were wrong. He droned on and on and Mayor Higginson was so captivated he forgot to remind him that his 3 minutes were up a long time ago.

After the speakers "had their say", the council members weighed in. Dave Grosch expressed his concerns about how the traffic and noise would affect the residents. For John Mullin, it was simple. Wal-mart is a commercial use. The land is zoned commercial. Voila, the decision is easy-peasy. But inconsistent. Just a couple of weeks ago, John Mullin voted for an emergency ordinance to keep another commercial venture from locating in a commercial zone because it might have an adverse effect on the neighborhood. Mullin wasn't interested in any adverse effects from Wal-Mart. And neither were Boyack, Cunningham or Higginson. In fact, Higginson went so far as to say that the concerns were "monsters under the bed."

"All I've heard tonight are monsters under the bed...there are no monsters under the bed," says Higginson.

Classic Higginson. This certainly is not the first time he has belittled or denigrated residents who have come to council meetings to express their concerns. But this is probably the first time he has done so to an 800 member organization at a taped meeting. It was pretty obvious throughout the whole meeting that finally allowing the residents to "have their say" was an exercise in futility. As one speaker so aptly said, "Thanks for nothing."

It wasn't always like this in Poway. During the early days, after incorporation, there was a decided effort among the elected leaders to make developers listen to residents. I can remember a developer showing up at council one evening and residents voicing complaints. Councilmember Bob Emery growled at the developers, "You go talk to the residents and work it out with them and THEN come back and ask for approval." Things changed when the city formed a redevelopment agency and that redevelopment agency became the biggest developer in town. Projects were shaped behind closed doors between developers and staff. Things became "done deals" long before they went to council for approval. Residents "having their say" conformed to the laws, but otherwise, the exercise was meaningless.

The Wal-Mart expansion is an example of how the city plans to develop in the future. The residents concerns will be ignored.The Wal-Mart neighborhood meetings were a harbinger of that we-don't-have-to-listen-to-you attitude. Wal-Mart simply set up tables and displayed their plans for the neighbors to see. A one-way meeting. No opportunity for the residents to voice their concerns. So, so different than the neighborhood meetings about north Poway developments or the amphitheater. Those days are definitely over.

Another example of the city's willingness to blow off resident's concerns is the feebleness of the EIR (environmental impact report). It's a joke. For example, consider the traffic information. The Wal-Mart EIR says that the level of service (LOS) at Poway/Community Rd is level C. But for the last 14 yrs, the city has been saying that it is level "D" or level "E". In the upcoming staff report for Lowes, the LOS of the Poway/Community Rd intersection is level "D". How did it go from level "C" to level "D" in a week? Especially since the EIR claimed that expanding Wal-Mart would improve traffic in the area. Do people just make stuff up to fit whatever conclusion is needed?

Every year since 1997, the Poway council has made an annual declaration that traffic sucks so bad in Poway, they qualify for an exemption from state law. Every year since 1997, the traffic monsters were real, and Higginson signed his name to it. This year, for the first year since 1997, the city council has not made their annual declaration about where you cannot have a granny flat because traffic sucks so bad. So, if you are thinking about building one, hurry and get your permits. I am afraid that as soon as Lowe's is approved, the council will look under the bed and tell the state that those monsters are really, really real. And so scary.

CatchAll

• Redevelopment Update: Poway opted in to the "alternate" redevelopment agency. They are paying their "extortion fees" and hoping that the California Redevelopment Agency (CRA) wins their lawsuit against the state. The state's response to CRA's lawsuit: We made redevelopment, we can do away with it. CRA: Waaaahhhh!, we need that money, give it to us. The people said to give it to us. Who will build golf courses, new Charger stadiums, shopping centers and car dealerships if you don't give it to us? Next up: the California Supreme Court will decide to fast track the case or send it to the lower courts where it will take forever and an eon to be heard.
  
  
• Poway's reason for an emergency council meeting to keep medical marijuana collectives out of Poway: We can't let our neighborhoods deteriorate. Ha! Ha! You know what that reminds me of? The reason the city gave for pulling the Wal-Mart property out of the Poway Road Specific Plan and forming a new Wal-Mart Specific Plan: to limit uses which might bring increased traffic volume, flow and noise that would be incompatible with the nearby commercial and residential areas. Ha! Ha! Ha! Joe St Lucas has a few comments about the city looking out for our quality of life over at his blog too.
  
  
• It's been a year since the Poway City council voted to chuck the multi-tier water rates because it "wasn't fair" that some people were paying more for their water than other people. It's been a year since the city has done nothing about the sewer rates which charge higher rates to those who use the least water.
  
  
• The Poway Term Limits group is gathering signatures. I support term limits for Poway councilmembers and mayor. After hearing all 5 council members whine because the state is giving local property tax dollars back to the local schools to be spent on local public services instead of letting redevelopment agencies spend it on their favorite private enterprises, well, I'm beginning to think that even 2 terms is too long.
  
  
• Mark your calendars. August 23 will be a hearing for the Wal-Mart expansion environmental impact report. I'm betting that the staff recommendation will be that the neighborhood adjacent to Wal-Mart will be greatly improved by the increased traffic and noise. Unloading trucks in the wee hours will be just like white noise lulling your baby to sleep. But a store like that, heck, ANY store would be so uber incompatible in north Poway.
  
  
• The Arbolitos sports field lights are going in soon. The gnatcatchers didn't stop it and neither did 2 council members living nearby. It is going to be more costly than expected. The city engineer estimated it would cost $600,000 - $610,000 for the lights and field renovation, but the lowest bid came in at $781,645.50. Total appropriation, including legal fees is $950,000. PYSL kicked in $60,000.
  
  
• I've saved the best for last. I won't be getting robocalls from Duncan Hunter, June-Eyore, much longer. The bi-partisan California Citizen's Redistricting Commission approved new maps for California Senate and Assembly seats and Congressional seats. Poway won't be in Duncan Hunter's district after the 2012 election. Poway will be in a Congressional district that includes much of the City of San Diego that lies between Poway and Ocean Beach. This district leans a lot more to the left than Poway's current Congressional district. I'm sure it will be an interesting election year, and all, but isn't it amazing that the bi-partisan California Citizen's Redistricting Commission actually agreed to something? Without much fuss, too. Hmmm, next time, could they be in charge of raising the debt limit?

The New Redevelopment: Up For Grabs

Last week the legislature passed a new California Budget. There were 2 redevelopment bills attached to the budget bill that will mean some big changes for any city with a redevelopment agency.

Here is the Cliff Notes version of this post:

1. Redevelopment Agencies "grabbed" 5 billion dollars of property tax in California this year.

2. About half of that grab was from property taxes that would otherwise go to schools.

3. The state has been "filling in" revenue for school districts that lost property tax to redevelopment agencies.

4. The state has a $26 billion deficit and can't do that anymore.

5. The state eliminated redevelopment agencies when they passed the new state budget.

6. The state let cities and counties by-pass their demise of their redevelopment agency if they promised (in writing) to give some (not all, but a lot) of the property taxes back to local schools.

7. Poway plans to do #6. But not without whining and suing the state.

OK, now for the longer version.

In January, Jerry Brown become governor of California and surprised a lot of people (including me) by proposing to eliminate redevelopment agencies. I never saw that coming and I pretty much have had my fingers crossed since then, wondering if it would come true. It did. The legislature passed a bill eliminating redevelopment. In a compromise with his own party, Brown also signed a second bill allowing redevelopment agencies to continue if the city or county those agencies were in agreed to several state demands, mainly to give back most of the property taxes that they had grabbed from local schools.

Before I get down to the nitty gritty, I want to mention that 5 Republican state legislators voted in favor of eliminating redevelopment. None were from San Diego county. You would think that Republicans, who often spout rhetoric decrying big government, deficit spending, and loss of private property rights, would be on the front line of any campaign to eliminate redevelopment. But you would be wrong. Even with right wing blog sites like Stop The Money Pit and the more moderate Cal Watchdog pleading for their demise, most Republican state legislators refused to vote to eliminate them.

AB1x-26 is the bill that ends redevelopment agencies and AB1x-27 is the bill that revives them, if certain conditions are met. Currently, all redevelopment agencies are prohibited from doing much besides making regular debt payments. They cannot make any new agreements or buy or sell property. They can't hire more people unless they are replacing someone. Some of the agreements they made to hide their assets are invalidated. On Oct 1st,2011, the redevelopment agencies are officially dissolved and a new successor agency takes over. The successor agency can sell the assets and pay off the debt of the agency. They have to chip in to a fund that returns property tax money to schools and other taxing agencies. Eventually, after many years, the redevelopment debts of the dissolved agencies will all be paid off and all of the property taxes will once again flow to the schools, and local tax districts.

If a city or county wants to hang on to their redevelopment agency, they can opt in for the new alternative. But it will cost them. They must agree, in writing, to the provisions laid out in AB1x-27:

1) Notify the county auditor-controller by Nov 1, 2011 that they want to go for the alternative redevelopment plan.

2) Enact an ordinance promising to comply with all of the provisions of AB 1x-27

3) Send some money for FY 2011-2012 (their share of $1.7 billion) to the county auditor-controller to be deposited into a Special District Allocation Fund and to an Educational Augmentation Revenue Fund. (Note: The redevelopment agency has to give the money to the city and the city must send the money to the county for deposit into these 2 funds.

4) Send some more money for FY 2012-2013 and every year thereafter to the county auditor-controller to be deposited into the Special District Allocation Fund and the Educational Augmentation Revenue Fund. The exact amount will be a proportionate share of $400 million although the amount may change.

5) Agree to give the schools 80% of their usual share of property tax on all new redevelopment agency debt payments. Suppose a redevelopment agency issued new bonds and the debt payment on those bonds was $1 million per year. The school's normally get about half of all the property tax. 80% of half a million is $400,000. A redevelopment agency would have to give the schools $400,000 for every million dollars of new debt repayment. The schools in the Poway Redevelopment Agency area are PUSD, the county office of education and Palomar Community College District. Each would get the same proportionate share of the tax monies that are returned by redevelopment agencies as they now get from regular property tax payments.

6) The alternate redevelopment agencies are still required to put 20% of the tax increment into a low and moderate housing fund. For the FY 2011-2012 only, they can skip this allocation if they do not have enough money to meet their other obligations, including their share of the $1.7 billion payment to the county auditor-controller.

Poway has opted for door number 2, the alternative redevelopment plan. At their July 5th meeting, the council approved an ordinance to comply with AB1x-27. The second reading of the ordinance is scheduled for July 19th. Poway's share of the $1.7 billion in property taxes that will be diverted back to schools and special districts in FY 2011-2012 is reported to be around $10.3 million. Poway's share for FY 2012-2013 will be around $3.3 million. In return, Poway will get to keep their redevelopment agency and the $41 million in annual tax increment, which they can use to pay off their debt, pay their employees, and plan new projects. AB1x-27 lets cities keep their redevelopment agency and their tax increment money, as long as they give back some of the property tax money that was taken from local schools.

As expected, the people who are addicted to redevelopment money, are not giving it up without a lot of moaning and groaning. And lies. Or at least, misrepresentations of the truth. I transcribed a statement made by Councilmember Jim Cunningman from the July 5th meeting. (Hat tip to Joe St Lucas for sending me the recording).

Just a comment. It's very clear that, and its been oftentimes said, that local dollars are best spent locally, and especially for a city like Poway. And the notion really is that this was supposed to be helping the school district on a local basis as well. Which again doesn't meet the formula because this city always has been a great partner. When Don was the mayor last time, they built the Performing Arts center, and the baseball stadium, and constantly make .... The parks, the gymnasiums, and the meeting centers, we've been a very, very, good partner of the school district. My concern is that we deliver, and we should deliver as council, we should hand deliver these checks, that the 10 million dollars, by the time it whittles down to the school, will be almost nothing. Whereas the 10 million dollars allocated by this city towards 10 million dollars of projects, we get Solera, and we get Brighton, we get brick and mortar differences, which certainly is not gonna happen, in a sense, on this 10 million dollars of our money, our taxpayers' monies, are given to the county with the notion that it goes to the city (sic) just like the notion of the lottery was gonna save all the schools. Well, that money was gonna come back that. The administration costs as we know was 85%.

Cunningham gets it wrong in so many ways. First of all, the redevelopment funds will have to be deposited into a fund overseen by the San Diego county auditor. That same county auditor who currently handles all of our property tax payments and distribution. The county auditor sends property tax payments to the local schools every year from non-redevelopment area properties without those taxes "whittling down to nothing". The auditor also manages to send Poway's Redevelopment Agency their money every year without an 85% overhead. So what evidence or reason does Cunningham have to suggest this might happen to the funds set up for redistribution to local schools? AB 1x-27 does say the auditor-controller can charge the city or county "a fee that does not exceed the reasonable costs of auditor-controller to implement the provisions of this part."

Second, Cunningham seems to think that the redevelopment agency does a better job of using the schools' property taxes than the schools do. His proof? They have some nice brick and mortar projects to show for it. Schools on the other hand, invest in something less visible, less tangible than sports stadiums and gymnasiums; they invest in the students themselves. AB1x-27 will force redevelopment agencies to give the schools most of their share of property taxes to be used for teacher's salaries or whatever the educational professionals determine is the best use of the money.

Third. Did you really think the lottery was going to produce a lot of money for schools? Sheesh.

And fourth, when the local property taxes are returned to the schools, our local dollars will still be spent locally. Almost all of the $10 million that Poway has to give to the county fund, will go to PUSD and Palomar College.

The California Redevelopment Association (CRA) plans to sue the state over the elimination of redevelopment agencies and the so called "extortion" payments required to keep the agencies alive. They claim that the new laws violates Prop 22, which was passed last November. Prop 22 prohibited the state from taking funds from redevelopment, although the word redevelopment was pretty scarce on that referendum.

CRA is the group of cities and counties that have redevelopment agencies. Poway will likely join the suit. If CRA and Poway sue the state, we the taxpayers will end up suing ourselves. Now, if you want to see our tax money get whittled down, how about a court case where we are paying for both sides?

The state's argument is that they created redevelopment agencies and they can eliminate them. They also wrote the classic provision in the bills, that if any part is declared illegal, the rest still stands. Wouldn't it be weird if the courts struck down AB1x-27 but let AB 1x-26 stand? Redevelopment agencies that sued to avoid giving back the property tax to the schools would then get eliminated.

My personal, non-lawyer opinion is that AB 1x-26 is pretty sound and will likely not be struck down. Suppose a court did find the elimination of redevelopment to be illegal. It would be like saying that redevelopment agencies could continue to grow and divert as many billions of property taxes as they wanted. The state of California does not have enough revenue to backfill the lost property tax for the schools. Constitutionally, states cannot declare bankruptcy. If the courts rule that redevelopment cannot be shut down, then the state would have bills to pay but they have no money to pay them. It would be a Catch-22. I don't think the courts will do that, especially since the courts are funded by the state and have taken a huge hit this year in the all-cuts budget. Likely, their sympathies will not be with the redevelopment agencies who are sucking up all of the revenue for development projects and depriving other government entities from providing basic services. But that is just my opinion. What's yours?

What Goes Around Comes Around

I love me some Governor Moonbeam. And not just because one of those "job killing" government regulations he imposed during his first stint as governor is keeping me cooler this hot July morning. Brown made home builders put insulation in the attic. It seems a sane thing now, doesn't it?

I also love Governor Brown for having the guts and strength to eliminate redevelopment agencies. It is the sane thing to do. I am going to summarize all the redevelopment developments and how they affect Poway, but first I want to tell you a funny little story.

This year was a tough year for state legislators because California had a $26 billion deficit to fix. Plus, the taxes that were passed under the former governorator were due to expire at the end of June. So the state was in a deeper hole and had less revenue coming in. Jerry Brown wanted to deal with the deficit, half with cuts and half with revenue from extending Arnold's taxes. But all of the republican legislators stood firm and refused to put the tax extensions on the ballot for voters to decide. So, in the end, Brown had to settle for an all cuts budget that defers some of the deficit 'til next year.

That's not the funny story. That's a sad story. I didn't get to the funny part yet. Hang in here for a little bit, I'll get there. While the republicans were crowing about standing firm and not approving the tax extension ballot measure, unbeknown to them, something they did (or didn't do) was going to have a consequence that hurt them. One of the budget trailer bills, senate bill 89, cut the $130 million in vehicle license fees (VHF) revenues that used to be given directly to cities and counties down to about $75 million. The $75 million wouldn't go directly to cities' general funds, it would be given to cities through specific grants for law enforcement.

This change affected all cities and counties in California. But a couple of cities and at least one county really felt the impact. Orange County had been getting a bigger chunk of money from that fund to help finance their way out of bankruptcy. Since they had refinanced their bonds to pay off the bankruptcy, their funds were cut. They plan to sue to try to get it back.

Wildomar, Menifee, Eastvale and Jurapa Valley are four new cities with not a lot of money in their general funds. They VHF revenue they were planning on was about 25% of their total budgets. And now, it is gone. Ouch! That's going to hurt.

For some reason, they did not think that an "all cuts" budget would or should impact them. Local officials and Republican legislators from the area signed a letter to Governor Brown begging him to send SB89 back to the legislature and have them throw in $15 million more for them. (Note: Swanson is mayor of Wildomar.)

In her letter to the governor, Swanson wrote that the reduction to her city's budget would be "effectively forcing fiscal insolvency."

Wildomar and Menifee officials said they did not believe legislators approving the measure understood the implications for the new cities.

"At this point, I'm assuming they missed something when they rushed to put this together because of the unfairness to the four new cities," Swanson said.

School children, college students, seniors, the poor, the disabled, and, yes, newly incorporated cities, are all going to suffer from this budget. It certainly didn't have to be this painful, but Republicans refused to even let the voters decide if they wanted to soften the pain by extending taxes that were already in place. And now local Republican leaders want the budget changed just for these 4 cities and to hell with everyone else?

The irony of the request for more car tax money for 4 cities whose republican leaders refused to put the car tax extensions on the ballot was not lost on Gov. Brown. He would have loved to have an extra $15 million to help them, and millions more to help many others who are going to be hit very hard by this new budget. But he could not get 4 Republicans to give a damn about the implications to college students, the elderly, the schools, the poor and disabled or even, the courts. This budget sucks and the people who could have done something about it, only cared about themselves. Brown signed SB 89 without making any changes.

So now, the Republicans are saying Brown swiped the money from the 4 new cities in a Republican area just to spite them for not voting to put the tax extensions on the ballot. And here is where the story gets a little wacko. Jeff Stone, Riverside county supervisor, has proposed that Riverside, Imperial, San Diego, Orange, San bernardino, Kings, Kern, Fresno, Tulare, Inyo, Madera, Mariposa and Mono counties secede and form a new state, the 51st state to be named "Southern California".

Stone's Southern California would do away with term limits and have part-time legislators who get paid $600 a month and few benefits. The state would focus on enforcing border laws and do away with environmental regulations that protect air and water. Taxes would be minimal. Southern California, eh? Throw in a Sheriff Joe Arpaio and this could be West Arizona.

Brown's spokesman, Gil Duran, wasn't too worried about Stone's well publicized ploy. He told the Press-Enterprise, "A secessionist movement? What is this 1860?"

I must admit that I thought Jeff Stone's proposal was really wacko, an attempt to get Stone a lot of political attention among the crazy. Little did I know that there have been some secessionists around since the beginning of California statehood. According to Wikipedia, there have been 27 attempts to split up the state since 1850. The last proposal in 1992 advocated a 3-way split. None of these proposals came close to succeeding. I doubt that Stone's will get very far. But then I looked at his map. Stone's Southern Cal (not sure if I am taking liberties calling it that) wouldn't have too many liberals. But it also wouldn't have water, most of the coast, Hollywood or Silicon Valley. Most of California's wealth is in the northern half and Los Angeles. As contentious as the recent budget debate has been, I would be hesitant to show Stone's proposal to too many northern legislators. They may just find some common ground.

What if Wal-Mart Leaves Poway?

We moved to Poway in 1976. That was 35 yrs ago. During that time there have been many grocery stores, restaurants and little shops in Poway that have come and gone.

The first grocery store we shopped at was the Alpha Beta on Poway and Pomerado Rd. It was located about where Michael's is now. Back in those days, we almost never ran to the store without running into someone we knew. I think I spent as much time chatting outside in front of the store as I did shopping inside.

The next grocery store I remember shopping at was the Big Bear store, which was located where the empty Dixieline is now. The store's roof leaked in the rainy season and we had to walk around buckets and pails. They were always going to move and build at Poway and Silverlake, but they never did. Big Bear moved out and sold the land they owned. Eventually a Lucky was built there.

The first Vons in Poway was located where Henry's is. Later Vons moved to their current location on Poway and Community Rd. I can still remember their grand opening. I won a $100 shopping spree. I had something like 3 minutes to fill a shopping cart and I could keep anything as long as it didn't exceed $100 total value. There were real sweet about it and let me pick out some meat ahead of time. Then I had to make a spectacle of myself and dash down the aisle and grab the meat I had picked out.

Vons built a much larger store on Poway Rd near Pomerado, where CVS and Pic N Save are. I guess the town wasn't really big enough for 2 Vons, so the bigger one was shut down.

The point is, stores open and stores close. Same with lumber stores, nurseries, restaurants, car dealerships and any number of other retail venues. What is here today might not be here tomorrow.

What will happen if Wal-Mart moves out? Let me rephrase that. What will happen when Wal-Mart moves out? Wal-Mart is the biggest store in dowtown Poway. The Wal-Mart expansion is going to add about another big grocery store's worth of square footage to the current Wal-Mart. That will be one h-u-u-u-u-g-e store. What could possible move into that much space in downtown Poway?

It's not unlikely that Wal-Mart will move out at some time. That's just part of retailing. Wal-Mart's business practices make it even more likely that it will happen. Wal-Mart likes to saturate an area, then when the competition has moved out, they thin out their own stores. Once Wal-Mart gets a bigger toe-hold in San Diego, they could locate their stores closer to the freeways and leave the Poway store vacant.

And when they do move out, what will happen to the old store? Poway's Wal-Mart was built in 1992. Just before it was built, K-Mart closed. It took 2 years to get that building leased. And even then, the building had to be divided into smaller stores to get tenants. The current Wal-Mart is much larger than the old K-Mart, and the expanded Wal-Mart will be even larger. It could be a real problem getting it leased if Wal-Mart closes the Poway store.

According to Sprawl Busters, Wal-Mart had about 350- 400 "dark stores" in 41 states for sale or lease in 2005. That is up from 333 empty stores in 31 states in 1999. I do not have exact current figures, but Wal-Mart lists 103 sites for lease and 40 vacant building and 623 properties for sale on Walmart Realty. The 623 properties are land in a planned or current Wal-mart shopping center. Wonder which one they are pushing more, land sales next to future Wal-Marts are old vacant buildings?

Sometimes Wal-Mart will build a bigger store very close to another Wal-Mart in a town. When the old store closes, Wal-Mart may have ownership or leaseholder rights to prevent a competitor from moving in. Many Wal-Marts sit empty, attractive only to vagrants and vandals.

What can Poway do to prevent Wal-Mart from leaving a blighted big-box store in the center of town? One thing would be for Poway to adopt a store cap size. Our community is better off with buildings that are sized right for Poway, and can be leased when a tenant leaves.

Even if we missed the chance for a store size cap, Poway can take some steps (from newrules.org) to prevent getting stuck with a "dark store". Poway could

1) Require developers to post a demolition bond that can be used by the city to demolish the structure and maintain the site should the store become vacant.

2) Adopt a dark store ordinance that mandates that property owners market empty buildings as soon as they become vacant and voids any clauses in the retailer's lease that constrains the owner from leasing the property to another retailer.

The Poway Wal-Mart site is owned by Wal-Mart, but the ordinance should be crafted to cover any leased or owned big box store that may become vacant. Because large corporations have their own teams of self-serving lawyers, great care should be taken to make sure the ordinance is clear, specific and enforceable.

Davenport, Iowa had a dark-store agreement. Wal-Mart planned a larger store and vacated their original store. The agreement Davenport had with Wal-Mart required that Wal-Mart make "reasonable best efforts" to sell the store. Whatever that means. And Wal-Mart could reject offers that were below "book value " for it. Guess who determines the "book value" of the property?

Davenport staff forgot to specify in the agreement that Wal-Mart could not refuse offers that were above book value. After 2 years of no sales, the city has the option to buy the property or find another buyer. And the cost of demolishing the building, if necessary, would be paid by the new owner, not Wal-Mart.

Poway needs a dark store ordinance if they allow big box stores in the downtown area. And they need to make sure their ordinance is written better than the one Wal-Mart snookered Davenport with.

Ma & Pa Kettle Math, Poway Edition

It's been a really frustrating day. This post is a bit of a rant. You might not make it through the whole thing. So, I'm going to post this reminder at the top: If you or anyone you know has some thoughts on the Poway Wal-Mart expansion, either pro or con, NOW is the time to send them off to the council. If you like, you can comment on anything in the DEIR (draft EIR), or you can just email a note to the councilmembers telling them why you do or do not want the Wal-Mart expansion.

Send the emails to:

dhigginson@ci.poway.ca.us

jcunningham@ci.poway.ca.us

dgrosch@ci.poway.ca.us

jmullin@ci.poway.ca.us

mboyack@ci.poway.ca.us

Note: Near the bottom of this post, there is a link to an interesting blog written by Joe St Lucas. And don't worry, there's no heavy math terms in his post, although the number 30 will figure in. Be sure to click on the link and check it out.

And now to my whining.

If I haven't mentioned it lately, let me mention it again. I believe in government. I like having roads and schools and hospitals and cops to round up the bad guys. I like a little advance warning when a tornado is coming and a little help afterwards when our community is devastated by fire. Heck, I like medicare and social security too. I hate thinking about old people eating cat food to survive. I'm not one of those "shrink government down and drown it in a bathtub" people. But today, I am frustrated. Really frustrated. If some crazy wacko tea-partier goes on a bender about how government is the problem, I'm not going to interrupt. Not today.

I'm frustrated because the people running my local government seem to be saying and writing a lot of nonsensical things. For example, for 15 years the city has been saying that traffic sucked so bad on Poway and Community and Midland Rd., that they were exempt from the state law which requires that they permit granny flats to be built. Now that Wal-Mart wants to build a bigger store that brings in more traffic, the City decided to use a completely different method for evaluating traffic that concluded traffic doesn't suck anymore. It is a piece of cake to get through town, as long as you don't mind waiting through a couple of rotations of the traffic lights.

So I was already POd about that. Then, on next Tuesday's Poway council agenda, there is an item called "the draft Urban Water Management Plan(UWMP)" that really set me off. Poway (and all the other cities) are required by the state to prepare an UWMP. The data that is submitted is supposed to help the state plan for future water needs and also to set some water conservation goals for each jurisdiction. Part of the data that must be included in this document is the gallons per capita per day(GPCD) used by Powegians. To calculate GPCD, the total amount of water used in Poway over a certain period of time is divided by the population (using city water) and also divided by the number of days in the time period. For their calculations, Poway is using old Sandag data which estimated that the population of Poway was 52,056 in 2010. The numbers from the 2010 census are in and Poway's official population in 2010 is 47,811. So Sandag got it wrong, they overestimated by 4,245 people. But why is Poway using known faulty data in their UWMP? Could it be because dividing by a large population makes it look like Poway is using less water per capita than we really are? What value is this data when it is so far from being accurate?

I have another bone to pick with the City over the UWMP. It is an old one, which I have harped on before. In the report, there is a copy of a form Poway has to submit to the California Urban Water Conservation Council (CUWCC). On that form, Poway declares that they use conservation pricing for both their water and sewer pricing structure. Poway's 2-tier water rate structure is barely conservation priced. The only people who are given any incentive to conserve are the folks who use 200 or more units in a billing cycle. 200 units equals 149,600 gallons of water. There are only a handful of people who ever use that much water in Poway, so I guess you could say we have a very "elite" water conservation plan. For the vast majority of us, there is no conservation incentive at all.

So maybe they can bluff their way through calling the water rates "conservation priced", but, no way, no how, can anyone of a reasonable, minimally educated mind, declare that Poway's wastewater (sewer) fees are conservation priced. For one thing, CUWCC actually defines conservation pricing and Poway's sewer fees don't meet the criteria. Nevertheless, the City is claiming that they use an "increasing block rate" structure for billing for sewer.

CUWCC defines an "increasing block rate" as one "in which the unit rate increases as the quantity of units purchased increases". Poway's sewer rate structure is just the opposite. The more the customer uses, the cheaper the unit price is. It costs $12.49/unit for 2 units of wastewater and it costs $4.41/unit for 10 units and $2.64/unit for 20 units. The more one buys, the cheaper it gets, per unit. So how does that incentivize someone to conserve?

Today I have been going round and round with Kristen Crane, the Poway Utilities Administrator, who filled out that CUWCC form. She is insisting that Poway's wastewater pricing is an increasing block rate structure. It is so frustrating. Rates are taught in grammar school. You'd think somebody making $100,000 or so (courtesy of the taxpayers sewer customers) would know what a rate is!

I am sounding like those tea-stained loonies. Time to take a deep breath and think. Maybe Ms Crane isn't paid big bucks because she has a firm grasp of math and good comprehension skills. Maybe it is because she is willing and able to obfuscate. Otherwise, why would she so obstinately insist that Poway's sewer pricing structure is an "increasing block rate"?

It's been one of those days, when the people who "work for me" seem to be highly paid pencil pushers. Is government bloated with civil servants who spend their days filling out meaningless forms with bogus data? Why bother?

Like I said, I am very frustrated.

And now, as promised, here is the link to Joe's blog. I don't want to give the whole thing away, but let me give you a little hint. Would you say that a council member who sweeps aside a city rule, for the benefit of his sons and their friends, is acting ethically?

Honk if you believe this!

When my husband Larry was in grammar school, there was at least one reporting period when he was, shall we say, not the most stellar of scholars. Not wanting to upset his parents, or trigger some foreseen consequence, he handled the situation by grabbing a pen and changing that "F" to an "A".

My husband's childhood shenanigan was the first thing I thought of when I looked at the Wal-Mart Draft Environmental Impact Report(DEIP). Local traffic is graded on an A-F scale based on something called "LOS" or "level of service". "A" is the best grade and "F" is the worst. In the Wal-Mart DEIR, the traffic report card shows that the current condition of all major south Poway intersections are at LOS of "A", "B" or "C" with one exception. The intersection of Stowe and Community got a "D" for the afternoon peak hours.

This is a pretty amazing traffic report card. Remarkably amazing. Especially since, every year since 1996, Poway staff have produced a traffic map showing that the roads around Wal-Mart were LOS "D" or "E".

California state law requires cities to allow second dwelling units (think "granny flats") to be built unless that city has some overriding infrastructure or traffic problems. Every year since 1996, Poway has claimed that north Poway's water and sewer, and south Poway's traffic are too clogged up to handle any second dwelling units in any area of the city except the extreme fringes. To support their claims, the staff report has included a traffic map showing the LOS of the major roadways from the previous year. Here is the first LOS traffic map from the 1996 declaration(with 1995 LOS traffic map). Note that every road is level "D" or "E" or "F". (Click on map to enlarge.)

From 1996 until last year, the city insisted that traffic was level "D" and "E" on all south Poway Rds near Wal-Mart. Those same roads that are now marked with a current LOS of "A", "B" and "C" on the Wal-Mart DEIR. I've posted copies of the traffic maps for each year on scribd. Here are the links if you want to look at them.

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

Here is the most recent Poway traffic map from the 2010 resolution on second dwelling units:

So how did the roads go from LOS "D" and "E" to "A", "B" and "C" in one year? Wal-Mart didn't take a pen and change an "F" to a "B", but they might as well have. What they did do was to redefine each grade.

For example, consider LOS "C". Here is the original method of defining it:

Level of Service C describes with delay in the range of 15.1 to 25.0 sec per vehicle. These higher delays may result from fair progression and/or longer cycle lengths. Individual cycle failures may begin to appear in this level. The number of vehicles stopping is significant at this level, although many still pass through the intersection without stopping.

What they are saying, is that at LOS "C", some cars might have to stop for the traffic light and be stopped for 15 to 25 seconds.

Here how LOS "C" is described in the Wal-Mart DEIR:

This level still represents stable operating conditions. Occassionally drivers may have to wait through more than one red signal indication, and backups may develop behind turning vehicles. Most drivers feel somewhat restricted, but not objectionably so.

Really? Most drivers don't object to sitting in traffic for a couple of rotations of the light? Who are they kidding? There are a lot of drivers out there who seem ready to plow through my vehicle if I stop at a red light, and you want me to believe they are only mildly vexed at having to sit through a couple of rotations of the light? I don't believe it.

There seems to be a huge difference between the old Level "C" and the new, Wal-Mart revised, level "C". But, hey, descriptions and their interpretation can be subjective. To get a more precise and unbiased look at how LOS definitions have changed, we can look at the numerical data used for the old traffic report cards and compare it to the numerical data used in the Wal-Mart DEIR.

Criteria for LOS of Signalized Intersections

Do you see what I see? I see some pretty serious grade inflation. In the good old days, if most of the cars had to wait 30 seconds to get through an intersection, that intersection would have been graded "D". In the Wal-Mart DEIR, that roadway is graded "C". Just last year, if the average wait at an intersection was 55 sec, that intersection was graded "E", and very nearly graded "F". The Wal-Mart DEIR says that intersection gets a "D" grade.

According to Poway's General Plan, the LOS is an important consideration in the approval of any planned project. The 2nd strategy under land use and transportation says:

2. Prohibit development which will result in Level of Service E or F at any intersection unless no feasible alternatives exist and overriding public need can be demonstrated.

All of the major intersections near Wal-Mart were identified as LOS "D" and "E" on city maps for the last 15 yrs. The increased traffic from the Wal-Mart expansion would have downgraded them to LOS "E" and "F". Thus, the need for the new grading system which I am naming "The Wal-Mart Curve".

The Wal-Mart curve is a bit unsettling. Our council members are not young grammar school kids. They are adults. Supposedly, reasonable adults. What does it say about how they govern if they use one set of rules for 15 yrs, then adjust the rules to get the desired outcome for a proposed project that can't pass under the old rules? If the council accepts the Wal-Mart DEIR as it is, then our General Plan is a completely meaningless jumble of words, subject to arbitrary interpretation and implementation.

How Homeowners in PQ, Carmel Mtn Rnch, Sabre Sprgs and RB Get Dinged for Poway's WalMart

Wal-Mart has proposed expanding the Poway store into a super-store. The DEIR (draft environmental impact report) is available online. I've only scanned it. But the parts I have read seem kind of ridiculous. For example, the report says that the noise from increased traffic will have no significant impact because people can't hear that when they are outside. Uh...right. And the diversion of sales from other retailers and groceries in the area? Wal-Mart doesn't see any significant impact from that either because they are only going to sell a small amount of food. So they say in the DEIR.

One area the Wal-Mart DEIR did not touch on is the impact to PUSD school funding. The biggest chunk of school funding comes from property tax. Because Wal-Mart is in Poway's redevelopment area, almost all of the property tax from Wal-Mart's current store and all of the new property tax from Wal-Mart's expansion will go to Poway's redevelopment agency. Almost none of that property tax goes to PUSD.

Compare that to the property tax on the adjacent parcel on the corner of Poway & Community Rd, the shopping center with Vons on it. That parcel is not in the Poway Redevelopment Agency area. About 40% of the property taxes from that parcel go to PUSD. When the residential, commercial and industrial property owners in Rancho Bernardo, Rancho Penasquitos, Carmel Mountain Ranch, Sabre Springs and 4S Ranch pay their property taxes, about 40% of their taxes goes to PUSD. When Wal-Mart and Costco (in Poway) and Home Depot (in Poway) and every industrial park owner pay their property tax, almost nothing goes to PUSD. When the home owners of Old Coach, Bridlewood and Rancho Arbolitos developments pay their property tax, almost nothing goes to PUSD.

PRA (Poway Redevelopment Agency) diverts about $39 million in property taxes every year. About $16 million of that would have gone to PUSD if PRA didn't exist. That amounts to almost $1700 for every student in a PUSD school located in Poway. So, who makes up for that $1700/student shortfall in funding? Partially, that funding is made up from property owners in RB, PQ, Carmel Mtn Ranch, Sabre Springs and 4S Ranch. In 2009, PUSD got about $97,252,000 from San Diego properties within the district and only $17,3000,000 from Poway properties. 85% of the property tax PUSD gets is from San Diego, 15% is from Poway. The rest of the funding is made up by the state.

One of the big ironies of this funding scheme is that PRA gives little (and big) gifts to PUSD. Gifts which enhance the Poway PUSD schools. Like the Performing Arts Center, multipurpose rooms and gyms and various other athletic facilities. PUSD does not get these "gifts" from the City of San Diego, because San Diego does not have a redevelopment area in PUSD boundaries. So, the non-Poway side of PUSD gets screwed twice. First, they pay a greater share of property tax funding to PUSD. And, their schools don't get gifted by any redevelopment agency.

Jerry Brown has proposed eliminating redevelopment agencies. It cannot happen too soon. Since his proposal was made in January, redevelopment agencies went out and spent about $800 billion. $800 billion with interest is at least $1.5 trillion dollars. That translates into almost $750 billion dollars robbed from school districts. In just the first 4 months of this year. How can the state make up that kind of money to the schools?

Brown needed Republican votes to pass an urgency measure to dissolve redevelopment agencies. He only got one. There is still a chance that a bill to end redevelopment will be passed as an urgency measure. But if the bill is passed by a simple majority, it may not go into effect until January 2012, although it could possibly be implemented sooner if it is part of the whole budget package.

Once the state ends the redevelopment program, the redevelopment agencies will cease to exist. They will be replaced with successor agencies. The successor agencies will be tasked with paying off the redevelopment debt. PRA has about $250 million in redevelopment debt. So, some of the property tax from Poway properties will be diverted to pay off that debt. The schools will likely not get their full share until that debt is paid off. It remains to be seen how much the state will subsidize PUSD and the other schools while that debt (which is still accruing) is being paid off.

Don't worry. PUSD has a plan. They have endorsed legislation that would lower the percent needed to pass a parcel tax from 66 2/3 % to 55%. A parcel tax is a tax that is uniform for every parcel in the district. That means the owner of a 2-bedroom condo with carport in RB will pay the exact same amount as a 10 bedroom Poway mansion with 6-car garage. The parcel tax can be used to pay for teacher salaries and operating expenses.

For years, PUSD has benefitted from redevelopment. They have gotten the state to make up the money they lost to PRA, while getting gifts bought with the money PRA diverted. It was almost too good to be true. Apparently they never stopped to think about what would happen when the state could no longer make up the millions and trillions of dollars that redevelopment agencies have diverted from schools. Or how much redevelopment debt is borrowed debt that encumbers future school funding. The state can't print money. If the burden becomes to big, the state cannot fill in the funding for the schools. We are already there and there are still billions and trillions to pay off. That means RB, PQ, Carmel Mtn Ranch and 4S Ranch are going to have to continue to pay a disproportionate share of PUSD school funding and they may end up paying an additional regressive parcel tax just so Poway Redevelopment Agency could keep the property tax from Wal-Mart, Home Depot and the north Poway mansions.

An Open Letter to PUSD School Board

Dear PUSD Board Members: Todd Gutschow, Penny Rantfle, Linda Vanderveen, Andy Patapaw, and Marc Davis,

Times are tough. Teachers and other non-teaching staff have taken pay cuts and furloughs. Programs have been cut. The classrooms are getting more crowded. As if this wasn't enough, the governor is planning to defer funds that are owed to the school district. You are planning to take out a loan to cover the costs until the deferred funds finally arrive.

I certainly can sympathize with School Board President Penny Ranftle when she complained that the new governor's budget "wasn't good enough". Certainly, the budget shortchanges schools and everything else. But what is Jerry Brown supposed to do? He can't print money like the feds.

The primary method of funding schools has been through property taxes. For the last 28 yrs or so, property taxes collected in Poway have been diverted from the schools. And yet, I have never heard Mrs. Rantfle or any other PUSD school board member complain about that.

Redevelopment is the program that diverts property taxes from the schools and local governments. Redevelopment is a state program that was meant to revitalize poor, blighted urban areas. The state allowed cities and counties to form a redevelopment agency to "clean up urban blight". The redevelopment agencies get to keep any new property taxes from new developments in the agency area. There are now about 420 redevelopment agencies in the state of California and they suck up 12% of all property taxes collected in the state.

In San Diego County, redevelopment agencies are diverting about $400 million in property taxes each year. About half of that would be going to the schools if there were no redevelopment agencies. San Diego County redevelopment agencies divert just under 11% of all property taxes, a little bit less than the statewide average. Poway's Redevelopment Agency manages to divert about 50% of all property taxes. How did Poway manage to do this? In 1983, when they formed their redevelopment agency, Poway put an astounding 8200 acres of mostly undeveloped land in their agency area. When developments like Old Coach Estates, Bridlewood, Rancho Arbolitos, and the entire Industrial Park were built, the new property taxes went to the Poway Redevelopment Agency instead of to schools and local services.* I estimated that the schools are currently losing about $19 million/yr from the diversion of property tax to Poway's Redevelopment Agency.

It is true that Poway uses some redevelopment money to spiffy up the schools. The Performing Arts Center, various sports fields, and multipurpose rooms have been built with redevelopment funds. Getting new athletic facilities is nice, but it isn't equivalent to PUSD getting $19 million/yr to spend as they see fit for academic programs like reading, mathematics, and science.

As part of his budget, Governor Jerry Brown plans to eliminate the redevelopment agencies and pay off their debts and return funding to the schools. Of course all of the cities with redevelopment agencies complained quite loudly. Not unexpected. They can borrow millions and billions of dollars every year without voter approval to build shopping centers, stadiums, golf courses, and car dealerships. They can pay it back over the next 25-40 years with all the property tax that they steal from the schools.

Perhaps you don't really understand the enormity of the brewing disaster. Do you remember that "doubling a penny"exercise? The first day you give someone a penny, the second day you give him 2 pennies, the third day you give him 4 pennies, the fourth day you give him 8 pennies, etc. In 30 days, you will have given him over $10 million dollars. That's a great exercise to explore the concept of exponential growth. Redevelopment agencies property tax grab is also growing exponentially. It isn't doubling every day like the pennies, but it is growing exponentially. In 1970, only 2% of all property taxes were diverted to redevelopment agencies, By 1980, the percentage doubled to 4%. By 1995, it doubled again to 8%. Currently, redevelopment agencies are grabbing 12% of all the property tax. That's unsustainable. No governor is going be able to make up an ever increasing diversion of property tax funds from the schools.

I haven't heard a single peep out of any PUSD official in support of Brown's plan to eliminate redevelopment agencies and return the property tax money to the schools and local government. I am wondering why the cat has got your tongues. I did notice that you all are supporting a lower threshold to get a parcel tax measure passed. Really? Parcel taxes are regressive. A parcel tax levies the same fee on a mansion with 6-car garage as it does on a 2-bedroom condo with carport. I would not be able to support a taxation system which diverts property taxes to help build car dealerships and shopping centers and then makes up the money with new taxes that affect the little guy way more than the richer folks.

If redevelopment agencies are axed, I would begrudgingly support a 5-yr extension of taxes that are set to expire. I don't like having to do that to make up for shoveling tax money to rich developers over the last couple of decades, but at least the tax extensions are only for 5 yrs (unlike a new parcel tax). The Republicans have refused to put the tax extensions on the ballot, unless their long list of demands were met. Have you seen this list? Some of the items would affect the teachers you employ. In particular, the Republicans want pension reforms that would affect current and future employees. They want to increase the health and pension costs that teachers pay and to decrease or delay pension benefits. They want voters to get to vote on any pension increases. (Uh, so they are for voters to decide pension issues, but not tax issues????) They want the pension based on the highest 5 yr average, and to be capped. They also want to reform teacher seniority rules allowing layoffs based on performance instead of seniority. Where does PUSD stand on these issues? Do they support them? Did anyone from the PUSD board lobby any legislator to get the tax extensions on the ballot with or without this list of demands being met?

I am pleased to hear that a local chapter of Service Employees International Union ( SEIU ) will be marching at a May 13th rally to "bring not just education but the government back to the people." Will anyone from the PUSD board be marching with them? It is kind of late, but at least it would be a start at advocating "for the kids".

Sincerely,

Chris Cruse

* Property owners in these developments do pay for school bond issues. In this article I am not referring to bond issues that add additional tax to the regular 1% property tax bill.