CITY OF SACRAMENTO'S USE OF REDEVELOPMENT MONEY
Joe Sullivan

On March 7, 2006 the Sacramento City Council approved a yearly subsidization payment of $75,000 in redevelopment money, for five years, under an Owner Participation Agreement with new owners of the Esquire Plaza building, to preserve the yearly $275,000 paid in rent by the IMAX theater in the building. The agreement is intended to protect $6 million of redevelopment money the city gave to the Esquire Plaza's original owners in 1998, to include the 450-seat IMAX theater and related office space in their building. Unfortunately IMAX never made money, and the original owners reduced their $425,000 yearly rent to $275,000 to keep the theater afloat. The Esquire Plaza was sold in 2004, and the new owners were not willing to continue the rent subsidy when the IMAX lease came up for renewal. The city stepped in to salvage the IMAX, and were offered an agreement by the new owners wherein they would continue the rent at $275,000 if the city would agree to pay half the original reduction of $150,000 to the new owners directly. The new owners would forgive the remaining $75,000. The Council voted to do so.

The Taxpayers League has no quarrel with the city's attempt to keep the IMAX alive. However, at the City Council meeting, as Taxpayers League representative, I stated I believed the subsidy was illegal, as the Redevelopment Act did not appear to envision use of redevelopment money for operating expenses. I believe it constitutes a gift of taxpayer's money. The money should come from another source, as was done by the city and county with regard to supporting the Music Circus and the associated theater. The city's legal counsel for the Sacramento Housing and Redevelopment Agency, when asked by the Mayor about the gift issue, told the Council they were purchasing a Covenant, a legal obligation to continue operations, which is not a gift of public funds. The League's legal advisor confirmed a Covenant was not illegal. However, from my perspective a Covenant is merely another form of "contract", and under a number of definitions for Covenant, in Black's Law Dictionary, one close, but not the same, example states, "a covenant to pay rent by installments, to keep the premises in repair..." I agree only that a legal agreement exists between the city and the Plaza owners, but still believe it's a misuse of Redevelopment money.

My rational is that the California Community Redevelopment Act of 1945, which gave cities and counties the authority to establish Redevelopment Agencies to address urban decay and to apply for federal funding, was not devised to help cover grants to failing private enterprises. The Act, added to the Health and Safety code in 1951, was renamed the Community Redevelopment Law. "Redevelopment" was defined as the planning, development, re-planning, redesign, clearance, reconstruction, or rehabilitation, or any combination of these, or all or part of a survey area, and the provision of those residential, commercial, industrial, public, or other structures or spaces as may be appropriate or necessary in the interest of general welfare, including recreational and other facilities incidental or appurtenant to them. The Agencies are governed by appointees of cities and counties governing members, who often appoint themselves as the Agencies Board Members. Such is the case in the County and City of Sacramento. Such Agencies are an entirely separate government authority, with their own agenda, revenue, and staff. The funding for such Agencies is called "tax increment financing." When an Agency adopts a Redevelopment Plan within its jurisdiction, it establishes a "base year" of assessed value of all property included, and all property tax increases from then on above the "base year" can be diverted as Redevelopment Funds to be used to accomplish the Agency Redevelopment Plan.

This Act's Agencies throughout California have become the most egregious operations used to divert taxpayer money into questionable areas. They have been termed "The Unknown Governments" as they are created without a vote of the citizens affected, can incur bond indebtedness without voter's approval, and can condemn public and private property. Statewide, they have developed a massive public debt with little public awareness or oversight. The IMAX rent subsidy, I believe, is another example.

TIME FOR A PART-TIME LEGISLATURE

Notwithstanding the collapse last November of Proposition 77, intended to use a panel of three judges, in lieu of Legislators, to draw political district lines in the future, many voters still want to see the job taken away from the politicians. And, the Legislative leaders, recognizing voter unhappiness with the present procedure, are mulling around to figure out how to do it. The latest ploy, described in The Sacramento Bee, is to redraw the districts every decade (as is done now), beginning in 2011after the 2010 census, accomplished, "by a citizens commission, with legislative leaders choosing a majority of its members from a pool of candidates nominated by a panel of retired appellate judges."

This effort drives us back to mid 2004, when Winnie Comstock-Carlson, in Comstock Business Magazine, wrote, "An Old Idea That's New: A part-time Legislature." She mentioned that Ted Costa, of the People's Advocate was considering an Initiative to create a part-time Legislature. Instead, he became the force behind what became Proposition 77, aimed at changing the drawing of political boundaries. At the time she pointed out that, "California is one of just nine states whose legislatures work year-round and whose members are full-time employees-although some still have private law and other professional practices or business interests." She noted that part-time legislatures seemed to work, using Texas, the second most populous state as an example. The Texas legislature meets every other year, and the session only lasts six month for about 140 days. Winnie stated, "Yet they get done what has to be done."

Shortly after that, in a meeting of former California Governors, Gray Davis said the legislature should be part-time so that they could spend more time with the public. After, radio's Tom Sullivan said he favored a part-time legislature, followed by disbelief that he and Davis could agree. Lew Uhler, President of the National Tax Limitation Committee, co-author of the Term Limits Proposition, once wrote in The Bee that, "Governor Schwarzenegger may call a special election next year (2005) to make the Legislature part-time." He ended the article by writing that, "after the '66 switch to a 'full-time professional' Legislature, a good case can be made for return to a citizen Legislature. Before '66 California had some of the best roads, water systems, schools and universities in the nation. Since then our infrastructure has crumbled and the K-12 and university people claim we have shortchanged them."

So we say to Ted Costa, what we have said before, "let's make the Legislature part-time." Ted is the right guy to lead to end the era of our "professional politicians".

ROB REINER'S PRESCHOOL PROPOSITION 82

Robert Reiner's Proposition 82, to create a government-run, preschool program for all four-year-olds, to be paid for by raising the personal income tax on the wealthy by 1.7%, has come under fire for the use of taxpayers money during the signature gathering period to advertise for the program. This is one of just a few problems with regard to the Proposition. Among those even more important are higher priority state needs for any new tax increase, creation of a new multi-billion government program and bureaucracy that will only increase the current 66% of preschool aged children already in private programs by 4%; specifically circumventing the educational guarantees of Proposition 98, shortchanging K-12 schools of potential funds; and destroying the existing marketplace of private preschool providers who do not use taxpayer dollars for their programs.

Author Lance T. Izumi of Pacific Research Institute, in an article titled, "REINER PRESCHOOL INITIATIVE WRONG AND DEFEATABLE", related that columnist Michael Hiltzik, of the Los Angeles Times, described "the initiative as an attempt at ballot-box budgeting featuring misleading PR and misguided pied-piper appeal. Hiltzik then ripped the RAND Corporation study, which has become the bible of Reiner's campaign, that claims that for every $1 spent on preschool, society will get back $2.62 in long-term benefits such as better student performance and lower crime. Hiltzik notes that RAND's calculations are based on a Chicago program aimed at black children in that city's poorest neighborhoods. Although the studies main author says that the Chicago program is the most relevant for comparison purposes with Reiner's envisioned California program, Hiltzik notes that the two programs are hardly identical. The Chicago program provides health screening, speech therapy services, meals, home visits, and continual and intensive parental involvement efforts. None of these elements observes Hiltzik, is specifically funded in the Reiner initiative."

Further, There are a number of other studies that show the statistics and conclusions used to support Reiner's Proposition 82 are spurious. The League has joined a Coalition of Business & Taxpayer Organizations in opposition to the Reiner Proposition, and recommends you read the Director of Education Studies for Pacific Research Institute, Lance Izumi's article on the Institute's website www.pacificresearch.org.

A PRIMER ON McCLELLAN PARK CONTAMINATION

Recently, Concern has been expressed by local elected officials with regard to funding for, and time-table of, the cleanup of contamination at the former McClellan Air Force Base. The following information was extracted from an excellent report by League Member Paul R. Green Jr., who is a McClellan Restoration Advisory Board (RAB) Member. Paul ended his report to the RAB by stating to its members, "Each of us has a responsibility to the public whom we individually and collectively represent to keep them informed as best we can and in laymen's terms that they can understand." We believe that also.

McClel McClellan Air Force Base closed July 1, 2001 and is now McClellan Park, a community of technical and education-related private and public agencies. A military remnant is an Air Force contingent whose responsibility is to manage and oversee the environmental cleanup and property transfer of the former base. In Sacramento since 1936, McClellan AFB was a 3,452 acre industrial complex, whose primary function was a depot level aircraft repair facility, with some level of systems management for Air Force communication, electronics, and space programs.

Hazardous contamination of mostly organic materials was "found" on McClellan in 1979, resulting from past, non-malicious, disposal practices of dumping, burying or otherwise disposing of waste materials primarily in the non-populated areas of the base. Leaking pipes and other spillage or runoff also contributed to the problem that exists today. The primary contaminant types are volatile and chlorinated organic solvents. General cleaners and items such as paint thinners, degreasers, soaps and others similar compounds, along with the associated waste materials; rags and containers, used during the cleanings routinely were buried or allowed to runoff and seep into the ground or water drains. Other contaminants exist, but in much smaller amounts. In recognition of this and consistent with both Federal and State law, "The Air Force assumes full responsibility for the contamination that is now present at McClellan, and will clean up the contamination regardless of who is using the property. The Air Force's program to implement this locally is the Installation Restoration Program."

Strict criteria exist for cleanup and decisions made to transfer McClellan property from Air Force ownership to public or civilian control. Verification must be presented that documents that area-by-area cleanup has been completed to standards considered safe for habitation or, if not, that restrictive covenants exist to ensure only proper interim use until cleanup is complete. To this end, the Air Force constituted a Restoration Advisory Board (RAB) who exchange information among community members, regulatory agencies and the Air Force. Its mission is to advise the Air Force and regulatory agencies of community concerns on environmental cleanup, funding, and priorities. It supports the search for safe, timely and effective cleanup solutions so that the Base may ultimately be transferred to public/private ownership. A corollary interest is to assist with obtaining a continued funding stream to ensure cleanup takes place as quickly as possible. As to the cleanup, the job is massive. Due to the complexity of the groundwater cleanup efforts, the expected completion date is sometime between 2034 and 2150, assuming a steady funding stream, even though all remedial actions are expected to be in place by 2015. Total expected cost, in today's dollars, is approximately $1.4 billion, making McClellan one of the largest cleanup efforts nationally, and placing it very high on what's known as the National Priority List (NPL), an indicator for funding. Therefore a continuous stream of money is needed until the project meets the requirements of the Federal Facilities Agreement (FFA)

Slightly more than 300 contaminated sites are mapped, thus far, and cleanup is underway or scheduled for each on a phased cleanup basis. Contaminated soil sometimes is removed by digging and is transported to designated landfills. At McClellan, over 1.3 million pounds of solvents have been removed from the soil thus far. In other cases, soil vapor extraction (SVE) is used to remove gas trapped between soil particles underground. This process uses a pumping system to vacuum the gasses and processes them through an oxidation or carbon based filter and treatment system and then releasing the harmless byproducts. This cleanup is uses and103 wells and 13 plants . 91 sites have been identified, but there are as many as 100 more potential sites

A third method used at McClellan is to drill extraction wells which pump contaminated water to the surface where it is processed through treatment units and released into local waterways, especially Magpie Creek. 103 extraction wells are now in use to pump groundwater to the surface for treatment, and the groundwater treatment system is fully operational. 57 of these wells were installed from 1987 to 1999 with the last 46 installed in 2005. With 575 monitoring wells groundwater contamination is well tracked and defined. Using these and other methods, Air Force managers already have spent $400 million and needs another $600 million to complete the job at McClellan Park.

Regarding other, special contaminants, the most notable is a find at CS (Confirmed Site) 10 (the 10th such site). Low-level plutonium was found there in September 2000 at a waste disposal pit that contained 55 buried drums. The problem created by this site was that the pit was some 30 feet deep and 200 feet wide by 600 feet long (two football fields), and that the drums were leaking. This created a potential danger that required immediate action - possible water table contamination. The site was sampled for leaks and none of substance was found. Cleanup was begun immediately and "chasing" trails was implemented to ensure that all migrating contamination was completely gone. To date, approximately 56,000 yards of dirt has been excavated, separated, and 25,000 yards of that dirt has been stockpiled. The stockpiled dirt has been separated into piles of dirt with low-level radium and dirt with low-level radium containing heavy metals.

A web site is available: http://www.afrpa.hq.af.mil/mcclellan for additional information. For an E mail copy of the full article provide your E-mail address to Paul Green at (916) 698-7900 , or by E-mail at prgreenjr1@juno.com.

LETTERS TO THE LEAGUE

We seek “Letters to the League” from Members concerning projects and issues on which we are working, along with recommendations on those we should look at. Letters may be edited and republished in any format, primarily in the interest of available space. Send letters, faxes, or e-mail to the Sacramento County Taxpayers League. Our e-mail is sactaxleague@prodigy.net; our telephone number is (916) 921-5991. Our fax number is (916) 567-1279. And our address is:
Sacramento County Taxpayers League
1804 Tribute Road, Suite 207
Sacramento, CA 95815.

EXECUTIVE DIRECTOR'S MESSAGE

HURRICANE KATRINA'S FRIGHTENING MAP
My oldest daughter, her husband, my granddaughter and her husband, with two of my great grandchildren and two of her husband's children, all in the New Orleans area, had to flee Hurricane Katrina to Dallas, Texas. When they returned to their homes, which did survive, although damaged, my daughter sent me issues of The Times Picayune covering the event from the beginning. My interest, beside their safety, was because I lived for almost three years in Algiers, LA, directly across the Mississippi from New Orleans, and in the same Orleans Parish (County). The information and maps in the Picayune were what you would expect to find in a major paper covering a local tragic disaster, and interested me as a former resident. However, they didn't have a major impact on me, other than feeling the regret and concern all Americans feel for those affected by the calamity.

A week ago, my daughter sent me a Times Picayune map of the flooded New Orleans area that was one of the most horrible presentations of it, or any other, disaster that I have ever seen. It has haunted me since. It appeared in the Tuesday, December 27, 2005 issue of the Picayune, a full page map, in color, titled VICTIMS OF KATRINA - WHERE THEY WERE FOUND. The flooded areas were colored in light orange, which covered nearly the entire downtown, and superimposed were bright orange circles of different sizes representing different numbers of bodies found, and where they were located. At the site of my former office downtown, just off Canal street, were10 circles, representing about 45 bodies. I wonder if any of those 45 people, who died off of Canal, were employees of the telephone company I helped found!

I am taking the map to the next Auburn Dam Council meeting to show to the members. Then I'm going to obtain a photo copy from the Picayune and give it to water editorialist Tom Philip of The Sacramento Bee as an example of a map I hope The Bee will never have to publish of a flooded City of Sacramento.

Joe Sullivan

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