Brea First — of the people, for the people and by the people.

My prime objective, from day one, has been to encourage my friends and neighbors to pay more attention to what goes on at the Civic Center and to make the best use of their vote as possible. I’m pleased to share with you the launch of a new grassroots group, Brea First. Their Director, Chris Gaarder has been kind enough to provide this background.

Brea FirstIntroducing Brea First

By Chris Gaarder, Director

Last Thursday, January 28, Brea First hosted our first public meeting, on “Developing Brea: From Oil to Commercial Success.” We believe it is important to look to the city’s past if we hope to build a better future.

Brea FirstOur speakers, former Mayor Carrey Nelson and Olinda Oil Museum docent Jack Smith, shared valuable insights on how Brea became the city it is today. Brea FirstWe heard fascinating anecdotes from the early oil days to the more recent redevelopment efforts that created much of the city we see today.

That was then, this is now.

While it is tempting to say the past is the past, decisions made 10 or 100 years ago have effects that ripple into the Brea of today and the Brea of our children’s future. Brea First will continue to explore Brea’s history in our upcoming meetings, and we hope to put a special focus on the city’s future.

Our plan is to host a monthly public event providing Breans with information and analyses of our past, present and future, from local and outside experts.

All too often, critical issues of local government do not get the attention they deserve. In the coming months and years, Brea First will work at the grassroots level, putting the welfare of the people of Brea first, by shedding light on the matters having the greatest effect upon our daily lives.

By promoting a better understanding of how Brea’s government works today, the people of Brea can help create a better tomorrow.

Counting our blessings.

Brea contributes a tremendous amount of good to those living in the city and beyond, including strong schools, a vibrant business scene, a high quality of life, and strong bonds among the diverse communities within the city.

There remains, however, longstanding issues poorly addressed and still unresolved. Breans voice continuing concerns over transparency, accountability and the proper role of government.

Our most serious problem: unfunded pension liabilities.

The unfunded public pension liabilities owed to the City of Brea’s past and current employees are particularly troubling. According to Pension Tracker, Brea has the second worst unfunded public pension liability per household ($20,113 in 2013) of any city in Orange County.

That puts Brea among the worst five percent of cities for unfunded pension liabilities per household in all of California. The reality is, left unresolved, Brea could face the crippling of vital services or even bankruptcy. Residents, including city workers and retirees, could be hurt by these looming liabilities.

Bad news, good news.

As bad as the unfunded liability may be, there are a variety of other serious issues facing the city. The good news is, as Brea First brings an array of issues to the fore, we can find workable solutions to the challenges facing Brea.

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Become part of Brea’s Solution.

Plan to hear our February meeting announced in the coming week. Stay connected by visiting our Facebook Page and Website where you can sign up for our email list.

Brea First is a bright light on the horizon.

Brea’s politics has often been contentious in recent years. We all know it. While important change swept through city hall in 2014, serious issues remain.

I have great expectations for Brea First, confidence in the leadership and am hopeful to see it’s ranks grow at an exponential rate. I hope you feel the same encouragement I feel and make an effort to get involved.

Cannabis Cultivation In Brea?

Proposition 215 (the Compassionate Use Act of 1996) is a California law legalizing the use of medical cannabis. Enacted on November 5, 1996 by means of the initiative process, Prop 215 passed with a majority vote of 55.6%.

Though medical cannabis was legalized and accepted by the majority of California voters, Prop 215 does not supersede federal law. Marijuana is still illegal under federal law which causes a conflict between the state and the U.S. Government.

A legal frame of reference.

cannabisFearing that state law might be created that would usurp local control, on April 3, 2007, Council adopted emergency interim Ordinance No. 1100-U prohibiting medical cannabis dispensaries in the city of Brea.

On March 18, 2008, Council, adopted interim Ordinance No. 1113 extending the prohibition — with a one year time limit, expiring in April 2009.

Prior to the expiration of Ordinance 1100-U the city’s options were to either adopt a full prohibition of cannabis dispensaries or form standards to allow the use.

Obviously, Council opted to adopt full prohibition. On December 9, 2008, the Planning Commission adopted a resolution which recommended language to Council for an ordinance prohibiting medical cannabis dispensaries in the city of Brea. (Documentation)

Council, on January 20, 2009, had the first reading of an amendment to the Brea Municipal Code prohibiting medical cannabis dispensaries in the city of Brea. As on all prior occasions public hearings were conducted. Having no one wishing to speak to the matter, hearings were opened and closed without comment.

On February 3, 2009, Council had the second reading of the resolution and adopted Ordinance No. 1120, a full prohibition of medical cannabis dispensaries. (Documentation)

It only took 19 years for the next chapter in the Chronicles of Cannabis to be written.

On October 9, 2015 AB266, AB243 and SB643 became California law. Known as the Medical Marijuana Regulation and Safety Act (MMRSA). It’s charter was to license and regulate commercial medical cannabis. MMRSA created the Bureau of Medical Marijuana Regulation in the Department of Consumer Affairs – an agency to be similar in scope to the California Department of Alcoholic Beverage Control.

Buried deep within MMRSA, a phrase marked for deletion indicating that any county or municipality not having an ordinance on the books by March 1st regarding cultivation of cannabis would have their authority to control locally ceded to the state. Inadvertently overlooked, this clerical error triggered panic across the state.

Clerical error amended!

AB21, introduced by Assembly member Jim Wood, on January 4th, is making the rounds in Sacramento and should land on Governor Brown’s desk by January 18. Governor Brown has guaranteed his signature. By the time Council meets the compelling need to respond will no longer exist. (Documentation)

Frankly, there have been too many instances of emergencies like this and this sort of unnecessary pressure hasn’t generally produced the best results.

Still, the sky is falling in Brea?

Pot_BReacting to the clerical error, on December 15, 2015, Council declared a state of urgency and enacted Interim Ordinance No. 1181 “Prohibiting all commercial medical marijuana uses in the city, including deliveries, prohibiting all medical cultivation including cultivation for medical use by a qualified patient or primary caregiver.” (Documentation)

Though the title of this ordinance clearly is all inclusive of areas subject to local control, it has been commonly referred to as a blanket prohibition of cultivation. The ordinance obviously extends to usage and distribution of cannabis issues as well.

On January 19 Council will duplicate it’s extension of the antecedent temporary ordinance prohibiting dispensaries, pushing out the prohibitions of Ordinance No. 1181 to January 2017. And, as before, the Planning Commission is (tentatively) being tasked “… to make a recommendation to the City Council related to land uses associated with the cultivation of marijuana (MJ). This recommendation will be in the form of a proposed amendment to the Zoning Code.

If this goes to the Planning Commission to initiate the process of making the “interim” prohibitions permanent, it will likely be at their January 26th meeting. Agendas for these meetings have not been finalized or publically released.

Stirring the pot, pun intended.

Pot_CInfuriated with the absence of public input in all prior policy-making, I’m hoping to encourage greater comment and opinion from Breans. At the Council meeting on January 19 and, if it is decided that nothing less than permanent law will be adequate to protect Brea’s authority, at the Planning Commission on January 26.

Okay really… an interim ordinance doesn’t say, “Please try to avoid doing these things.

An interim ordinance is as fully prohibitive as a permanent ordinance. The only difference is one runs out after a year the other remains in effect, theoretically, in perpetuity.

A lot of dust hasn’t settled.

Here are a few of the reasons I’m inclined to believe an interim ordinance would be sufficient to give Brea the time for a better look at the evolving landscape.

  • It will take as much as two years to get the Bureau of Medical Marijuana Regulation, the enforcement agency, up and running.
  • Much of the operating scheme of this agency is yet to be determined, i.e. licensing, fees, oversight and enforcement policies, etc.
  • More than one initiative dealing with aspects of cultivation, processing, distribution and usage (yes, think recreational) is either already qualified or likely will be qualified for the November 2016 ballot.

Pot_DAs we will likely know so much more by next November, wouldn’t it be better to wait to finalize Brea code until we have more answers than questions?

It’s been said that we shouldn’t worry about committing to a position now because we can always amend the code later. Really? It’s okay to do a half-assed job now because we can rewrite it later?

Sorry, but I don’t come from a place that thinks, “We can’t afford to get it right the first time, but we can always afford to fix it later.

The jury is still out.

For reasons that shouldn’t need explanation, I am in limbo on all of this. In the short term, understanding there is not really any urgent need to codify to preserve authority, what should Brea allow or prohibit and why? Should commercial cultivation and personal cultivation for medicinal use be linked together or treated separately?

Please, if you have feelings or opinions about this — of any persuasion — do yourself and your community a favor and carve out some time to be part of the process

Without your input how can the Council or Planning Commission be confident that the majority will, in fact, rule?

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Tiered Water Rates – Part 3

tiered water ratesA couple of months ago Brea Matters shared a very creative and user friendly formula for tiered water rates from Jason Kraft. Jason has continued to follow this closely and, with a critical public hearing scheduled for February 2, it’s time to share Jason’s sequel… and thankfully we don’t need to be rocket scientists to understand his plan.

Tiered Water Rates – It’s Time To Act!

By: Jason Kraft

Jason KraftYou probably received a notice in your mail recently indicating that a public hearing for a tiered water rate increase will be held at the Brea city council meeting on Tuesday, Feb 2, 2016 at 7pm, with a proposed effective date of Feb 8, 2016.

The proposed changes would increase the fixed rate for most residential water customers from $9.66 to a minimum of $10.81 and a maximum of $15.16. The variable rate — which is based on water usage — will also change, with the lowest tier of usage seeing the highest percentage increase.

The notice includes examples of how the change will impact monthly bills: someone who uses very little water will see their bill increase between 12% and 38%. Bills for average users would be 12% to 15% higher, while a heavy water user will see increases from 0.5% to 8%.

Why are tiered water rates increasing?

There are two major issues with water rates in Brea (and just about everywhere else in California): the gap between costs and revenue, and the financial volatility caused by relying on commodity charges to fund fixed infrastructure.

If you look at the fixed costs involved in maintaining our water infrastructure (which is the same regardless of usage) and the declining revenues from conservation, there are not enough revenues to cover those fixed costs. This is an urgent, short-term tactical issue that needs to be addressed ASAP to avoid even higher rates down the road.

tiered water ratesThe second issue relating to financial volatility is actually the root cause of the revenue gap. Since a large percentage of our fixed costs are paid for by water usage fees, when water usage falls we don’t collect enough revenue to pay those costs with the existing rates. The obvious solution is to just increase the fixed charge to a point where fixed revenue closely matches fixed costs, but the discrepancy is so large (63% of costs are fixed compared to 13% of revenue) that the resulting fixed charge would need to be ridiculously high.

This is what’s happening in Yorba Linda, who used the same tiered water rate consultant (Raftelis Financial Consultants) as Brea.

The compromise solution in Brea’s proposal increases the % of revenue from fixed charges to 14% (this is the minimum proposed fixed charge), then 17%, then 20%. That’s great, but even with the highest proposed fixed charge you still have 20% revenue from fixed vs 63% of costs. How much would this really reduce volatility, and is it worth burdening light water users and lower income residents with larger fixed charge increases that will never be rolled back?

To keep the system running, revenue has to increase, but the structure of the proposed increase puts too much of a burden on those who use the least amount of water. It’s an especially raw deal for Lifeline customers: the good news is they still get a 20% discount on fixed charges, but the bad news is those fixed charges will increase by 57% within a few years. I don’t think that’s fair.

Fixing the existing proposal.

tiered water ratesThere is a simple short-term solution to this short-term problem: keep the existing structure as-is and just apply a uniform increase to both fixed and commodity costs. I haven’t run the numbers for this but it should be similar to what you see on your rate notice for the minimum proposed fixed charge, maximum proposed commodity charge, and bill impacts for minimum proposed fixed charges.

If we look at the existing proposal, removing the proposed ramp-up for fixed charges in future years would result in bill increases about 8-12% across the board. I could get behind this proposal without the fixed charge ramp-up as a short-term fix. It’s not ideal but it would work for now, as it would only require minimal modification to the proposal and the city could save face on the money spent for the water rate consultant (which is an entirely separate issue).

Proactive water rates for the future.

Some of you may have heard me speak about this at the Nov 17th city council meeting, where I discussed an alternative tiered water rate structure that also meets revenue goals. The alternative structure I presented imposes a much smaller fixed charge increase, simplifies the tier structure so most customers stay within the first tier, and creates three tiers that align with the actual supply costs of our different water sources.

tiered water ratesThe solution I put together involves looking at historical and forecasted usage data to get an idea of how much the water district will have to pay during the next fiscal year for both fixed costs and commodity costs (supply and delivery). Once you have that cost number, you can look at each customer type based on their usage share, and set commodity rates for that customer type so the revenue from their forecasted usage matches their share of costs.

The rates can be adjusted as needed when supply costs or forecasts change. I put together an Excel worksheet that handles all the calculations, so the readjustment process is pretty simple.

With my solution the fixed charge would only see a small increase, which means commodity charges would still be contributing a significant amount towards fixed costs. However, if you reevaluate rates on a regular basis using usage data we already collect, changes in usage patterns would impact rates more quickly and there would be no excessive deficit or surplus.

I also propose changing to a 3 tier system to match supply costs of our water sources (Cal Domestic shares, Cal Domestic overage, and MWDOC). From a Prop 218 perspective this should be more legally defensible than the current 4 tier system, which as far as I can tell is not based on supply costs at all.

What you can do about it?

According to Prop 218, if a majority of Brea water customers submit a written protest by Feb 2, 2016, the rate increase will not be implemented.

If you’d like to file a protest, you can mail or hand deliver a letter to the City Clerk’s Office, 3rd Floor, 1 Civic Center Circle, Brea CA 92821, or you can email CityClerksGroup@cityofbrea.net. The protest must include the address of the affected property, the name of the property owner or tenant, and a note indicating that the protest is related to the proposed Customer Charge increases.

Note that if you speak at the Feb 2 hearing, your protest will only be counted if you also submit a written letter or send an email.

Due to the time constraints of the existing revenue gap and limitations in the city’s utility billing software (which would increase development time needed to implement a proposal with too many changes) I think the best course of action in the short term is to reject this proposal, modify it to remove the 17% and 20% fixed charge options, and send out a new public hearing notice with the revised proposal ASAP.

Then, we can start a real discussion about how to strategically shift tiered water rates so they make sense — and this time let’s see what Brea residents can come up with before throwing more money at consultants.

tiered water ratesIf you find this still a bit above your pay grade, as I do, at least file your official protest with the City Clerk as Jason Suggests. We should be willing to put the brakes on even if Council seems hell bent on rushing to judgement.

The first step to getting Council and staff to seriously consider and adopt ideas coming from the public is to convince them that doing so isn’t an admission of failure on their part. We’re a team, right? We share the common goal of putting Brea first, right?

If staff and Council aren’t willing to meet us half way, what right do we have to expect anything we contribute to Envision Brea to be implemented?