A New Decade Begins.

In city government there is no sense of reciprocity. The wealth, the benefit, the power and authority only travels in one direction — like water downhill — away from the people. Anyone who’s ever taken the time to actually go to a meeting or catch it on streaming video, will confirm… the voice of the people falls on deaf ears.

Hurry Up And Wait.

Everything centers upon the immediate, the now, the tyranny of the urgent. There is never enough time or money to do anything right the first time but always seems to be enough of both to fix things later.

And, that balanced budget they constantly brag about is proving to be little more than a myth. It is a classic example of robbing Peter to pay Paul, all wrapped up a David Copperfield sort of accounting process that makes finding the truth about anything an impossibility.

Pay No Attention To The Man Behind The Curtain!

The recent discussion over water funds is a prime example. As Council wrestled over spending another $1.2 million on some mysterious form of Cal Domestic water shares, Bill Gallardo and Cindy Russell referred to three different “water funds” with distinctly different functions within the city budget.

The problem? There is only one water fund, the 420 Water Utility Fund. Throughout Council’s “discussion”, including an awkward effort by Steve Vargas to get to the bottom of things, no one on Council seemed aware that there is only one fund.

Here is five and a half minutes of “must see teevee”.

Digging Into The Details.

I looked at the documentation in the 2019-20 Operating Budget and confirmed several things about this strongly limited fund.

Described by Gallardo, in the opening, as an “enterprise” fund that can only be spent on water improvements, water capital, water purchases. “We cannot use it for anything not related to the water system because that is an enterprise fund… it is separate and distinct.

Hogwash! I discovered that every year several millions of dollars received from the sale of water are diverted to other funds! In the Adopted 2018-19 Operating Budget, $15,261,399 was diverted (transferred out) to these funds:

  • $118,895 to the Fixed Asset Replacement Fund (182) which provides funding for the replacement of City owned infrastructure, facilities and capital assets.
  • $289,667 to the Risk Management Fund (470) used to account for the costs of operating a self-insured program for general liability, workers compensation, long-term disability and unemployment compensation.
  • $0 to the Information Technology Fund (475) used to account for the operations of the City’s Internal Information Technology Division. (Skipped this year.)
  • $14,852,837 to the Capital Improvement Fund (510) used to account for the citywide costs of constructing street improvements, parks and other public improvements.

Did you read anything about water there? Yeah, me either. Someone has some very serious explaining to do.

Public Water Utility – Not For Profit?

Governed by the CPUC (California Public Utilities Commission), a mutual water company is defined as any private not-for-profit corporation or association organized for the purposes of delivering water to its stockholders and members at cost, including use of works for conserving, treating and reclaiming water.

In 2019-20, the city received $24.4 million in revenue and expensed $22.5 million. That generated a “profit” of $1.8 million for the year. That’s after disbursing all transfers to other funds. Where did it go? Shouldn’t it have been refunded to rate payers? Certainly it didn’t find it’s way into offshore accounts.

Peeling the onion that is Cal Domestic Water Company and all of it’s holdings is long overdue. We’ll revisit that can of worms later.

Truth Or Consequences?

It is my very strong opinion that Council’s decisions are made with little concern for consequences other than those effecting re-elections or perpetuating those six figure public employee jobs with lavish pensions.

Facts and details are meticulously obscured to protect the perpetrators from discovery. The “insiders” have developed their own language, immortalized in policies, civil codes and laws.

The first response to any request from the public is, “No.” The NIH Factor (not invented here) is in full force. An unsupportable behavior from a staff that must always turn to expensive outside consultants to resolve even the most simple of tasks.

Until transparency and accountability become something more than campaign rhetoric, until the arc of history bends back again towards truth, justice and the American way — we will be forever trapped within the status quo.

Someone Find The Broom!

As 2019 draws to a close, there is growing rumbling about producing a sequel to Clean Sweep. The question becomes, how?

There are some who believe a combination of naturally ending terms and a recall could clear the dais and give Brea a fresh start. The problem is we have no idea who is lurking in the shadows to fill the void.

Frankly, “the devil you know is better than the devil you don’t” has kept many an inept council member on the job for multiple terms.

Maybe there is a less severe plan that would make more sense. I’m too annoyed at the moment to think about it.

Well… Happy New Year from Brea Matters. Let’s hope that 2020 is a prophetic reference to our vision for Brea’s future.

 

BOTA Pressures BOUSD Board.

Within an hour of Gail Lyons, Nicole Colon and Kerri Kropke storming out the BOUSD Board meeting Monday night, the BOTA/CTA shill Jim Rogers flooded Brea teachers with the message below.

Reading between the lines.

Hi BOTA Members,

Thank you SO much to everyone who attended and/or spoke at the board meeting this evening. We achieved our goal of packing the chambers and definitely made a statement. For those of you who were not there to witness it, the bond vote unfortunately failed. We cannot afford to lose momentum now.

Please read the following message from Jim Rogers, our CTA staff member for BOTA. Jim is also a teacher of many years and Brea resident, and he has our back! We must take action!

There is nothing on the BOTA website about this “demonstration” and no members vote was taken to ensure a consensus. When the “blue shirts” were commanded to stand by that Elmer Gantry on steroids, Joe Bartell, they did so with obvious hesitation.

Why? According to “blue shirts” that contacted us on the patio after the meeting and via email yesterday… BOTA members are as conflicted as the community at large, especially about the golden board perks.

Dear Members of BOTA,

Tonight’s School Board meeting did not go well for the children you serve, let alone your working conditions. A big thanks to everyone for wearing there BOTA shirts yesterday. For those members that were able to make the Board meeting last night, your presence was very important. Your strength as a unit comes when it’s time to stand together.

Tonight the Board failed to reach a super-majority to place a bond on the March ballot. This holds huge ramifications to BOTA members other than working in substandard classrooms and school sites overall.

Because of the age of the schools, plumbing and sewers, electrical, plaster and paint, roofing, and so much more updating is greatly needed. Too many classrooms have been displaced over the years. This is the obvious need for a bond.

What you don’t think of right away is the other complications that will come without a bond. Fixing the problems that pop up each year drains the General Fund of the monies that provide your wages, health benefits, and retirement payments. When any new monies are needed to fix breaks at the aging sites, there is less left to provide raises and enhancements to benefits.

BOUSD has $38,000,000 now to fix any of these items!

A bond must be passed in order for your bargaining team to be able to make agreements that improve your standing.

This is the union’s entire interest in this, not teachers or students, but in maintaining the union’s power.

It’s time for BOTA to show Carrie Flanders it’s strength! Paul Ruiz has been against the last three bond measures, and therefore we must not waste our energy on him, (at least until he runs for re-election.)

So, the union wants to bully Carrie… remember that folks!

Carrie and Paul both want a bond! They also want a board that isn’t taking money from students or is compromised by their need to perpetuate personal benefits.

The November Board meeting will be Monday, November 18, 2019, at 6:30 p.m.

WE NEED EVERY MEMBER TO SAVE THIS DATE!

Your strength in numbers will be needed to pass the bond, however, we must show Carrie Flanders that you have the strength to make it happen.

I wonder if Gail Lyons will make a copy of this message and, with tear filled eyes and quaking voice, wave it at the next meeting as another example of bullying?

Monday night she overlooked the message sent to parents during the campaign for Measure K to boycott downtown businesses – a clear attempt at bullying.

We need at least 150 members to show up at the November 18th Board meeting. Your presence alone will do the trick, but it’s appropriate for anyone who would like to speak also. (Speaking is not an expectation.)

Parading 150 red shirted teachers around (better than brown shirts) will do little to advance their cause… union power. Recent polls suggest roughly 80% of Brea voters support rescinding health insurance subsidies before working out the details of a school bond and putting it on the ballot.

That’s 120X your little band of red shirts. Get rid of the golden perk and Brea voters are inclined to support a well designed school bond.

We are going to wear RED FOR ED November 18th! We are then going to turn the Boardroom RED!!!

Again, thank you for your participation thus far, but please know how important it is that you turn out for this Board meeting! 150 strong!

Sincerely,

Jim Rogers

CTA Regional Uniserv Staff for BOTA

BOTA is expecting defeat.

This communication was written BEFORE the board meeting, evidence of the foreknowledge of their weak position. They anticipated defeat and played right into their own shortcomings. Brea teachers and parents, for the most part, are too smart to fall for their strategy of intimidation and misinformation.

Read Dwight Manley’s challenge to the board here:

“An Open Letter To BOUSD From Dwight Manley”

 

Birch Hills Golf Course, An Independent Legal Review.

Thankfully, for all of us, Dwight Manley sent a copy of the massive set of documents accompanying the October 1st item to accept title of the BHGC (Brea Hills Golf Course) to his attorney for review.

Richard Montevideo is the Chair of Rutan & Tucker, LLP’s Environmental Law Practice Group since 1992.

The review that follows was provided by him and shared with members of Council and the City Manager prior to last Tuesday’s circus of a Council meeting.

 

 

Property Transfer Document Review

There is a lot to unpack with these documents, but from my initial review of the Settlement Agreement, the AS IS Indemnity Agreement, the Guarantee, the Consolidated Area Easement Agreement and the Environmental CC&Rs, I have the following big picture comments from the perspective of protecting the City’s interest:

  1. For both legal and practical/business reasons, the City should clearly be preparing a formal Phase I Environmental Assessment Report on the Property before taking title to the same. The Phase I Report would provide some legal protection to the City from future enforcement action, and equally important, would consolidate all in one report, a description of the history operations that led to the contamination, a description of the type, levels and media of contamination, the remedial work that was conducted, the residual contamination that remains, and the risks posed by the residual contamination that remains.
  2. For all contamination on the Property, except for essentially contamination caused by Union Oil and that exceeds an existing cleanup standard, the City is indemnifying the seller, including Union Oil. As such, unless this provision is changed, the City should do everything it can to make sure it fully understands the nature and extent of the contamination, meaning conducting a Phase I Report and further evaluating the risks associated with the existing contamination for onsite workers and guests/invitees.
  3. The contaminants of concern at the Property, i.e., PCBs, dioxins, furans, arsenic among others, especially the dioxins, are significant carcinogens and thus the City should have the resulting risks associated with the residual contamination evaluated by a qualified environmental consultant, and presumably a toxicologist/risk assessor. If there is a problem in the future and someone is hurt or claims they are hurt from the contamination, it would be a PR problem for the City, in addition to being a significant legal problem.
  4. Pursuant to H&S code section 25359.7, the seller of the property is required to provide written notice of the existence or potential existence of all hazardous substances it knows or believes exists on the property to the buyer. In this case, I see no evidence of any due diligence disclosures that have been made to the City. Such due diligence reports/disclosures would provide a beginning point for the City to hire an environmental consultant to conduct a Phase I Report.
  5. The protections provided to the City under the various agreements are weak.   Essentially, the City is providing a full release of any all claims under Civil Code 1542, except for among other items, contamination caused by Union Oil that is above current regulatory agency action levels. Thus, if the cleanup standards change in the future, the City is on the hook for addressing the contamination. And in fact, DTSC is currently reviewing and will soon be issuing new guidance/policy on vapor intrusion standards, which may or may not impact the Property, depending on the nature of any volatile organic compounds on the site and their location.
  6. If a problem arises in the future resulting from existing contamination found to exceed existing cleanup standards (which is the only scenario requiring additional work by Union Oil), even then there is no direct remediation covenant that extends to the City. Instead, the City only has a general indemnity to rely upon and will need to show it has suffered some Loss before the general indemnity will kick in. in short, if there is some existing contamination exceeding existing/current cleanup standards, the City will not be able to require Union Oil to clean up the contamination. Normally, in a situation like this, you would negotiate a Remediation Covenant in the Agreement triggering an automatic cleanup obligation.
  7. Stormwater runoff, including dry weather runoff, is a significant issue in California, and golf courses can be big offenders of runoff limits, especially for nitrates, fertilizers, pesticides, etc. From the documentation provided, it is unclear whether the City has hired anyone to evaluate the stormwater runoff compliance issues, but it is clear that the City will be accepting this obligation.
  8. A certain quantity of contamination was buried within the Consolidated area, which then has resulted in a recorded set of Environmental CC&R imposed on this property. The City should make sure that its current and future use of the Consolidated area will not violate these restrictions. This is where again a Phase I Report would be helpful/important.
  9. The AS IS/Indemnity Agreement the City is committing to arbitration and waiving its right to a jury trial.
  10. The “Guarantee” provided by Union Oil is NOT a separate indemnity, but nothing more than Union Oil guarantying the very limited indemnity provided in the AS IS Indemnity agreement.
  11. The Guarantee agreement contains a Confidentiality clause which is unenforceable or otherwise irrelevant in this context when it is being provided for the benefit of a public agency. Either way, it looks bad from the City’s perspective and makes no sense.

I do not know the business/financial benefits of the transaction from the City’s perspective, but from a pure legal and environmental risk perspective, there are a number of issues that the City should take a second look at.

Also note, that the above are the larger issues with the agreements as written, but there are many more. The agreements appear to me to be seller oriented.

A “Reasonable Person” Responds.

I’ve made no attempt to distill Mr. Montevideo’s observations into lay language. As lawyers are apt to say, these remarks are understandable by “any reasonable person” – no reason for me to butt in.

I’ll close by simply saying this, all concerned… Council, Staff, “we the people”, have only a fraction of the facts and information needed to make a prudent decision in this matter.

By failing to admit their error, by not putting on the brakes to give much closer scrutiny to the details and implications of a decision this huge… Council fails us miserably.