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Last updateWed, 27 Sep 2017 1pm

Palm Desert Mayor Sabby Jonathan recently invited the public to enjoy complimentary coffee and conversation—something he plans on doing every month.

During his January coffee meeting, at the Desert Willow Golf Resort, the new mayor (the position rotates among City Council members on a yearly basis) was battling the flu. However, Jonathan, who works as a certified public accountant, was kind enough to agree to answer questions on anything—ranging from the city budget to new hotels to past city-employee wrongdoing—via email.

Regarding your quest for transparency—why the coffee chats?

Coffee chats are a great way for the community to engage with its elected officials. They provide an informal forum where concerns of residents can be heard and questions can be answered. The chats take place monthly, throughout the year, with the exception of July and August.

Is Measure T—an increase of the city’s hotel tax from 9 to 11 percent, passed by voters in 2016—working? How much money is it bringing in yearly, and is the city safer now because of it?

The change generates approximately $2 million in additional general-fund revenue a year, supporting police and fire services as well as other municipal programs and services that help keep Palm Desert safe and ensure a high quality of life that is enjoyed by our residents and visitors.

What is the city’s budget structure? How many special funds are there, and what are total revenues and expenditures?

The city financial records have many “governmental funds,” including the above noted general fund. The city has over 50 special revenue, capital, enterprise, special assessments and internal service funds. Most other funds are restricted or assigned for specific purposes and include traffic safety, transportation improvements, fire facilities, housing, development impact fees, recycling, public art, recreational facilities, capital improvement projects, landscape and lighting districts, etc.

For the fiscal year 2017-18, the overall expenditures anticipated for all funds are $118,624,985. Revenues are same as expenditures! Our complete budget is available online.

As a CPA, would you recommend changing anything in the current structure of the city budget?

Overall, our current budget process works very well. It is based on the city’s goals for the upcoming year, and it is “bottoms up,” meaning the process starts with the individual departments, which then take ownership of their respective budgets. We are looking at adding a five-year forecast to the budget process. … It would enable us to look ahead for the next five years, ensure there are no surprises, and give us an opportunity to take action if needed.

The city previously froze some motorcycle-cop positions. Do you plan to put them back on the streets soon?

We continue to work closely with our public-safety professionals to measure whether there have been any impacts from the frozen positions. To date, we have not seen any diminishment in the city’s ability to provide exceptional public-safety services. If this changes, we will act quickly.

The city of Palm Desert does not have its own independent police force, but instead contracts with the Riverside County Sheriff’s Department. What is the total annual dollar amount for the sheriff’s contract, and what is the current crime rate?

For fiscal year 2017-18, the city budgeted approximately $21.9 million for police services. The FBI Uniform Crime Reporting Program data for 2016 illustrates the city has a higher incidence of property crime than violent crime. This fact is likely attributable to the higher concentration of retail establishments within the city, as larceny-theft constitutes the highest number of property crimes. Examples of larceny-theft include shoplifting, bicycle thefts and pocket-picking.

Comparing the UCR data with the past crime rate reports, was there an increase in violent crimes and property crimes?

(There were) … significant decreases in every crime category, with the exception of motor vehicle theft. Overall, violent crimes were down from 117 in 2015 to 77 in 2016, and property crimes were down from 2,302 in 2015 to 2,146 in 2016.

Is the city improving, considering the new (hotel tax) income? Are the anticipated new hotels being finished on time?

Our transient occupancy tax revenue is supporting public safety and other municipal services and programs that enhance Palm Desert’s wonderful quality of life. The city is working closely with the developers of Hotel Paseo to facilitate its opening as soon as possible. … The Fairfield Inn on Cook Street finished on time and opened last summer. The SpringHill Suites (formerly the Fairfield Inn on Highway 111, which was destroyed by fire several years ago) is being reconstructed and should open later this year.

What is the city manager’s salary and benefits? The previous one (John Wohlmuth) got $300,000 (in severance and accrued vacation/sick pay) to leave amid a scandal involving nude pics.

The current city manager is paid $220,000 with a three-month severance package, but without health care or a car allowance, and with a maximum accrual of 320 hours combined sick leave and vacation. For comparison sake, the previous city manager’s salary was $248,911 annually (when he left), with six months’ severance, plus $500 per month for an automobile allowance, and the same health care and leave benefits as other executive employees (which excludes the 320 hour cap that the current city manager has). He had a combined total of 1,028 hours of sick leave and vacation time at his departure.

How do you keep the city fiscally sound? How is the city handling salaries and pensions?

The city of Palm Desert, throughout its history, has been a prudent steward of the public’s money. This is reflected in the fact that for decades, Palm Desert has adopted a balanced budget in each year, and maintains a healthy reserve balance. Looking back, we have been forward-thinking in addressing challenges related to staffing, whether it be during a development boom or a recession. During the recession, Palm Desert reduced its staff by over 30 percent, and we were proactive in making changes to pension and other benefits for new employees well before the statewide efforts to enact pension reform. … We continue to evaluate the labor market and look for the most effective ways to ensure that we have the best employees available to provide services to our residents.

Do you support the city’s system to rotate mayoral positions annually?

I am a strong proponent of rotating the mayor’s position, especially in small cities like ours. It avoids a lot of the “drama” that we see in cities with elected mayors, and it gives each councilmember an opportunity to engage at a deeper level, which I believe makes for more knowledgeable councilmembers, and a more effective council.

For information on upcoming coffee conversations, call 760-346-0611, or visit www.cityofpalmdesert.org.

Published in Local Issues

All five candidates for the three Palm Desert City Council seats up for election this year, not surprisingly, say they’re proud of their mid-valley city.

All agree that the city’s wide roads, pleasant parks, good schools and upscale neighborhoods are virtues that continue to make Palm Desert an attractive destination for tourists and new residents alike.

However, the city is facing fiscal and developmental challenges that could threaten the future growth and fiscal stability of Palm Desert.

The Independent spoke with each of the candidates and discussed their concerns, their priority issues if elected, and their views on Measure T. The only city measure on this November’s Palm Desert ballot, Measure T calls for a 2 percentage-point increase—from 9 to 11 percent—in the city’s transient occupancy tax (TOT), charged to every traveler who stays in a hotel within the city’s borders.

On this one issue, the candidates agree: They all say they’re voting for the increase.

Incumbent Van Tanner (right), a retired insurance-company executive and former member of the city’s Parks and Recreation Commission, is wrapping up his first term on the City Council. He was the most outspoken proponent of Measure T.

“Wherever (tourists) go to stay, they’re going to pay a TOT. Well, we’re the lowest in the Coachella Valley, and (if Measure T passes), now we’re going to be right in the middle. So the 2 percent is going to generate $2 million in additional revenue, and it is something that we need to pass. It’s not a question of how we’re going to do it; we need to do it.”

Businesswoman and local pastor Kathleen Kelly explained why she supports Measure T.

“We have the absolute lowest TOT in Coachella Valley, and there’s nothing strategically beneficial to the city in holding that spot,” she said. “We’re not gaining an advantage by being last. We’re just forgoing the opportunity to appropriately look for income to cover the added expenses that the tourism brings with it.”

Susan Marie Weber (right), the other incumbent who is running for re-election as her first term draws to a close, said she’s a libertarian who normally does not like taxation. However, she supports Measure T.

“A hotel tax is a little bit different. It’s more like a user fee, which is a voluntary tax,” she said. “We use the (TOT) money to make sure that the roads are clean, that we have public safety available to keep you safe, and we have our other amenities.

“Two years ago we tried to pass a similar measure, but it was so specific that people living here thought they were going to be taxed,” Weber said. “But this time, it’s clear that the resulting revenue will go into our general fund to be used as we (the City Council) think it should be used. For instance, the police and fire services surprised us with increases, so we sure could use a little more money to offset those costs.”

Gina Nestande is the wife of former congressional candidate and former State Assemblyman Brian Nestande. She said she hopes to contribute her fundraising and leadership skills to the council’s work.

“This one time I am—but it’s only a Band-Aid that the city needs right now,” she said about Measure T. “We can’t rely on raising the TOT every couple of years to help our budget. We need to increase revenues, diversify our economy and keep the young people here—or if they do go off to college, (we need them) coming back here to work. But that will only happen if we have the infrastructure here for them. We can’t just rely on the golf and tourism industries. Tourism is great, and we can be a wonderful tourist destination—but again, we have to think bigger.”

Jerry Martin is a former golf professional, entrepreneur and insurance agent who is the driving force (pun intended) behind El Paseo Cruise Night and several other car-centric events.

“I am in favor of raising that TOT by 2 percent,” he said. “It doesn’t really affect the residents of Palm Desert, and that added revenue is really important. We need to come up and be more in line with the rest of the cities here in the desert. You know there are a lot of additional costs (regarding tourists) involved in operating the city, especially when it comes to fire, police and ambulance service, so those funds will be really important.”

The candidates also largely all agreed on the strong need for improved cooperation among the nine Coachella Valley city governments.

Kelly (right), who moved to the valley at the age of 7, made the case succinctly: “Regional cooperation is increasingly important to our quality of life in Palm Desert. As the Coachella Valley has built out, we have increasingly become one large community. So it’s not possible to go it alone, even if someone philosophically thought that was desirable. Reaching across party lines, generational divides or other potential boundaries to inspire and facilitate collaboration—that’s my skill set.”

All the candidates voiced cautious optimism that the CV Link project—a proposed valley-long pedestrian/bike path—could be completed if no undue burdens were placed on Palm Desert’s citizens, and if environmental-impact studies raised no major concerns.

Some of the candidates identified one key issue on which they’ll work first.

“There’s the redevelopment of Highway 111, which is already in progress,” Martin said. “Many buildings along the highway will be given a facelift, and there are plans to put the stores, markets and services on the first level, with living spaces on the top levels. Younger people are gravitating toward a lifestyle where they can leave their homes and apartments and walk to shops and restaurants.”

Weber sounded the alarm regarding the potential financial risk posed by the generous pension and retirement packages being granted to city employees. “We need to complete a pension review,” she said. “We started a couple of years ago to try to change our method so that when new people were hired, they’d come in under a different pension structure, but we’re still doing like 30-some percent, you know? So if you’re earning $100,000 a year, we’re putting $30,000 aside in pension for you. Way to go, huh? That’s unsustainable, and we’re going to be in a death spiral if we don’t work on that.”

Nestande (right) highlighted education and Salton Sea protection. “I’d like to focus on fast-tracking the Cal State University,” she said. “It is our only four-year university (located in the valley), and it has limited degree programs. I’ve met with the chancellor, and they really have a wonderful agenda to try to increase the number of degree programs offered here.”

She suggested this new approach for saving the Salton Sea: “We need to think regionally and expand beyond Palm Desert. What’s been proposed is that the big stakeholders create an Enhanced Infrastructure Financing District. This plan has to be approved by a vote of 55 percent of the citizens, but if it were to pass, it could raise as much as a couple of billion dollars.”

Tanner said he would focus his work on developing and implementing a new general plan for Palm Desert.

“It’s a systematic way to take our city into new areas over the next 20 years,” he said. “It deals with land use as well as economic fiscal responsibility, because we want to make sure that our tourism stays strong, and our retail sales stay strong. That’s what’s going to create the revenue for our general fund for everything that needs to be done in the city.”

Published in Politics

The city of Palm Desert is rising up against the state’s tax takeaways by asking its residents to raise a fee on visitors—and this is all unfolding in the shadow of a well-publicized scandal involving the former city manager.

According to city officials, the state of California has taken about $40 million away from the state every year in redevelopment funds. So on July 28, City Council members unanimously voted to place a measure on the November ballot that would increase the local transient occupancy tax (in other words, the hotel tax) from 9 percent to 11 percent, to replace a small fraction of the $40 million the state takes every year. That 11 percent would be on par with what other valley cities charge.

They nicknamed it Measure T. That may sound somewhat familiar to Palm Springs residents, who in 2011 passed something called Measure J. However, the similarities in the ballot initiatives end there: Palm Springs’ Measure J increased the sales tax by 1 percent, while Measure T will affect only people staying at the city’s hotels and motels.

Some of that Measure J money was used for downtown redevelopment in Palm Springs, and was at the center of the high-profile FBI raid at the City Hall which also apparently targeted then-Mayor Steve Pougnet.

Palm Desert Mayor Bob Spiegel was adamant that his city would not end up having any such problems if residents pass Measure T.

“I don’t think it is appropriate or relevant to talk about challenges facing other cities,” Spiegel said. “Palm Desert has earned a well-established reputation for fiscal responsibility and good stewardship of public resources.”

Spiegel said certain steps would be taken by the city to prevent any possible misuse of the funds generated by the proposed Measure T.

“Measure T is subject to strong accountability provisions, including independent audits, public oversight and local control of funds that cannot be taken by state,” Spiegel said.

While Spiegel claimed Palm Desert has a “well-established reputation for fiscal responsibility and good stewardship of public resources,” it is worth noting that the Palm Desert City Council earlier this year gave former City Manager John Wohlmuth a severance package valued at nearly $300,000 after he allegedly showed a nude photo of a co-worker to his colleagues at City Hall.

City officials claimed they approved the severance package to avoid being sued by Wohlmuth.

Anyway, back to Measure T: Spiegel said the Measure T funds would help the city deal with rising public-safety costs.

“For the first time in Palm Desert’s history, public-safety costs have exceeded 50 percent of our annual budget,” he said. “Measure T will provide a dedicated local source of funding.”

Palm Desert contracts with the Riverside County Sheriff’s Department for law-enforcement services.

“We work closely with the (sheriff’s department) to address the community’s needs,” said Justin McCarthy, Palm Desert’s interim city manager. “If, in consultation with them, additional deputies are required, we would recommend adding them.”

McCarthy, who is being paid $119 per hour as the interim city manager, said Measure T would generate approximately $2.2 million annually.

Palm Desert is home to 12 hotels with 2,171 rooms. There are also numerous timeshare properties that will be affected by Measure T, depending on their vacancy.

“The city has three vacation ownership (timeshare) properties that function like hotels: Marriott Shadow Ridge (1,093 rooms), Westin Desert Willow Villas (268 rooms) and Embarc Palm Desert—Intrawest Resort (88 rooms),” said Palm Desert spokesman David Hermann.

According to Hermann, the three timeshare properties function as hotels when the units are not booked by owners.

“The resorts advertise the rooms on online travel sites, etc.,” he said. “And when guests pay their bill, the resort collects the transient occupancy tax along with the charge for their lodging.”

Measure T would obviously bring in even more revenue with additional hotel development—and city officials say two new hotels are under construction.

“Hotel Paseo is a boutique hotel being built next to The Gardens on El Paseo,” Hermann said. “It will have 150 rooms. The brand is the Marriott Autograph Collection, and the hotel is expected to open in September of 2017.”

A Fairfield Inn, near Interstate 10 and Cook Street, has a projected October 2017 opening date.

Published in Local Issues