Costa Mesa’s recently adopted budget includes $444,000 to
redo the medians on Mesa Verde Drive.
Yes, these medians, the ones redone so recently many of the trees are
still staked.
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| Does this really need to be replaced? |
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| Note stakes on small trees in both pics. |
The money to do this and still have a balanced budget, at
least on paper, was taken from funds set aside for future use for a new
library. Other unfunded needs include
repairs to the fifty-year-old Royal Palm Fire Station and generators for the
Police Department. City Manager Tom
Hatch stated that the City needed to start setting aside money for such major
expenditures as replacement of the fire station and building a new library
(video at about 3:01:50). Council Member Mensinger, who
urged that the City spend money on the medians, suggested the City fund major
improvements using mechanism similar to what was done for the police
station (video at about 3:03:40).
What he didn’t mention is exactly what that meant. Did the City get a grant? Did we use narcotics forfeiture funds? How was the police station expansion and
rehab financed? Debt.
When did Costa Mesa voters approve the debt financing?
We didn’t.
Article 16 of the California State
Constitution, prohibits cities from incurring any debt without two thirds
approval of the voters, but the City used a mechanism called Certificates of
Participation, or COPS. The bond buyer,
oops, the COPs buyer “participates” in revenue generated by the activity funded
by the borrowed money.
If you’re wondering what revenue stream is allocated to pay
the debt, it’s the lease payment for use
of the police station. And who, you may
ask, is leasing the police station? We are.
The City is essentially leasing the police station to itself, then using
the lease payments to pay off the bond.
The bonds for the police station were not issued by the City
but by the Costa Mesa Public Financing Authority. The Financing Authority is a joint powers
authority made up of the City of Costa Mesa and, er, well just the City of
Costa Mesa acting jointly with itself.
The board of the CMPFA consists of the Costa Mesa City Council.
In December 2006 the Costa Mesa City Council, acting as CMPFA , voted to borrow up to $30 million to be paid back through the revenue stream
received from leasing the police station to the City of Costa Mesa . By putting on another hat, the city
acquired nearly $30 million in debt which it will repay by leasing the police
station to itself. At the end of the
lease period, the City will once again own the police station free and
clear. In the unlikely event of default,
the holders of the COPs can take title to the police station.
And it’s all legal!
Lots of cities do it. Both Santa
Ana and Newport Beach financed city hall improvements with COPs. Stockton did it for all sorts of things.
But somehow, frittering money on “improving” recently
improved medians that already look pretty good while in nearly the same breath
suggesting we go into debt for necessities just doesn’t sit well with me. Sort of like taking the family on a Caribbean
cruise while getting a second mortgage to pay for replacing your leaky
roof.
It’s especially troubling when the debt is incurred using an
end run around the voters of the City of Costa Mesa.
11 comments:
Thank you, Sandy. You are the voice of reason. If only we could get the rest of the residents to hear and understand what is going on.
Why, why, why? Could it be that Steve's buddy Jim needs a project to point to so he can say, "Look what I did for you, Mesa Verde! Vote for me!" From what I saw at the meeting, he didn't even offer up a reason. Nevertheless, he got the 3-2 vote the Mousekeeteers always take for granted. Remember in NOvember.
$440k. Wouldn't it make more sense to focus on what caused Costa Mesa’s
collective unfunded pension liability to rise to above $200 million? The only 2014 candidate involved in that 2008 decision was Katrina Foley.
At the last council meeting our mayor asserted that pensions were no longer an issue; the State was taking care of it. Whether you agree with that or not, what really makes sense at any time is responsible use of ALL public dollars.
I was not aware of that. Thank you for helping keep everyone informed!
Is there ANYWAY to cancel this enormous waste of taxpayer money for a 'feel good' pork barrel project? This appears to me a conflict of interest vote by 2 council members to make pretty their own neighborhood?
Thank you once again Sandy for investigating further and you are indeed the voice of reason. One of the most important things that the majority of council lacks - reason. I would think that Tom Duarte would advise more wisely to keep the city out of legal suits, or maybe that's what he wants.......a job forever....
Very interesting. Thanks for keeping the focus on the important issues.
One could see removing the lawn and replacing with mulch to reduce watering. Tree bubblers would be a better way and would reduce damage to the adjacent asphalt from the inevitable irrigation run off. Narrow medians such as this are notoriously hard to water without running the water over the edges.
Also, reduced lawn area would reduce long term maintenance costs.
Reminds me of Robert Heinlein's _The Moon is a Harsh Mistress_, wherein he expresses admiration for the two (fictitious) Chinese guys who establish operations next door to each other on the moon, and then get rich selling rocks to each other. Or Fabre's words about spiders in the himalayas that live above 25,000 feet, where there is nothing for them to eat except other spiders...
Heinlein's acronym is "TANSTAAFL", for "There Ain't No Such Thing As A Free Lunch" -- because if there were, the Diet Cokes would cost sixty cents, not three bucks each.
The first law of thermodynamics ("You can't get something for nothing") and the second law of thermodynamics ("You can't even break even, in this world") hold for an awful lot more than Physics.
Sandy, your comments are vastly appreciated and uncommonly scarce. More, more, more!!
The thought just hit me this morning (better late than never :). Isn't the water used recycled water? And how does this square with 'his' want to grass over Fairview park for sports fields?
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