Monday, July 29, 2013

Whatever Did Happen To Those 2010 Water Rate Increase Federal Matching Funds?

What, me worry?
I was doing a little research last evening and turned up something fairly interesting. You may recall that in 2010, when the previous two water rate increases were being spawned, our then Mayor Joe Mosca couldn't talk enough about Federal matching funds and how they would help us repair our decayed infrastructure. The word being put out by His Honor was that if residents agreed to the water rate hike as presented in 2010, the Federal government would magically match it and all would be made good.

Now I personally don't think that most Feds are all that brilliant. To paraphrase the Ronald Reagan quote somewhere on the lower righthand side of this page, if they were they'd be in private industry making the real dough. But I do believe they were smart enough to know that the reason Sierra Madre needed their money was to help handle its bad bond debts. And despite what was being spoon fed to the residents here, this had precious little to do with repairing pipes and fixing water wells. As such, we were never going to see a dime.

But that didn't stop Mayor Joe Mosca from walking this little doggy around the park. In a Pasadena Star News article titled "Sierra Madre residents face possible water hike," dated July 9, 2010 (link), Mosca made this specious claim:

Mayor Joe Mosca said the time is now to invest in the city's water system. A rate increase would allow the city to match local dollars with federal funds to improve Sierra Madre's water system so that citizens will not have to shoulder as much of a burden, he said.

"To those who think this is too expensive, it will be more expensive in the future if we do nothing now," he said.

But that was hardly all of it. In a City of Sierra Madre agenda report titled "ORDINANCE 1312 ADJUSTING WATER RATES FOR FISCAL YEARS 2010-2015," dated July 13, 2010 and bearing Mayor Joe Mosca's name, the following is listed as #3 among four reasons why water rates had to be increased:

The current water rates do not generate sufficient funding to meet the ‘local match’ requirements for federal funds that have been authorized for the City for use in the design and construction of water infrastructure repairs and replacements.

The City of Sierra Madre did raise its water rates of course, so whatever happened to those "authorized" federal matching funds? Did we ever receive any? Of course we didn't. The truth is there never were any federal matching funds because the water rate increase was not about repairing infrastructure. It was really about bond debt, unhonored covenants and imploded water bond ratings.

You only have to go out into our streets today and witness the blown water main du jour to know that precious little of that increased water rate capital was spent on fixing infrastructure. And how could that have been done, anyway? Close to $1 million dollars in Sierra Madre water department revenue is spent every year to cover our debts. Most of it goes to the Bank of New York for bonds, with the balance sent to the San Gabriel Valley Municipal Water District to pay down a loan.

There just isn't that much money left for anything else.

Of course, all of this was before the issue of Sierra Madre's $19 million (with interest) in water bond debt had actually entered the discussion here. In July of 2010, when Mayor Mosca and our always pliable City Staff was flogging infrastructure repairs and Federal matching funds as the reason for the rate hike, water bond debt was not being given much shrift. But by the Fall of 2010 that cat was finally out of the bag, and people were starting to talk.

In an agenda report titled "DISCUSSION REGARDING SIERRA MADRE WATER UTILITY OPERATIONS AND WATER RATE INCREASE" (10/19/10), the beans were finally spilled:

... the City’s Water Fund currently has two bonds and one SGVMWD loan outstanding. The 1998 Refunding Bonds are refinanced debt. This is similar to an individual who refinances their mortgage and takes the equity out under a new 30 year mortgage. The terms are principal and interest (5%) until 2019. In 2003, when it became apparent that the City had Federal Funds available to do Capital Improvements to the water infrastructure, the City issued new debt; because for each dollar provided by a Federal Grant, the City had a dollar match requirement. The terms of the debt are interest only (5%) until 2019 and principal and interest (5%) 2020-2034. To receive the interest only terms, the bank required a revenue covenant of 120% operational income. The covenant is security to the “second mortgage” that the Water Fund would remain financially healthy throughout the terms of the debt and that the City Water Fund would meets its obligations.

This was the actual reason why water rates were increased back then. Just as it will be the reason in 2013. There were never any Federal matching funds in 2010, that was just a story Mosca pulled out of his bonnet because he thought people would swallow it and then quietly submit to the water rate increase.

Like so many of the things Joe Mosca told us, this just did not have a whole lot of truth to it.

Here are a couple of questions to bring this all up to date. The senior City Staff that helped enable the "Federal matching funds" canard remains basically unchanged. The same people are still running City Hall today. Should we trust them to be more truthful this time around?

The other question is this. Mayor Nancy Walsh and Mayor Pro Tem* John Harabedian will apparently be jetting off to Washington DC in the near future in search of cash to help us with our water woes. But since the actual reason for our troubles is more about bad bond debt, and not so much infrastructure issues, will this also become an attempt to promote the myth that this latest water rate increase can somehow be tied to Federal matching funds?

And are they symbolically doing just that by going to Washington in the first place? After all, Mosca also made that trip.

I guess we will just have to wait and see.

http://sierramadretattler.blogspot.com

70 comments:

  1. Mayor Nancy Walsh and Mayor Pro Tem* John Harabedian go to Washington... sounds like an unreleased Jerry Lewis movie.

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    Replies
    1. Add the reverse mortgage salesman and you will have a 3 stooges movie.

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    2. The reverse mortgage salesman said he would go, and he would get his company to pay for it.

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    3. Is his company in the habit of paying for trips for their employees to carry out volunteer activities in municipal government?

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    4. 4:24 - SoCal Edison gave John Buchanan all the time off he needed from his "lawyer" job in the human resources department

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    5. lol - we're trusting Harabedian and Walsh to find money for water?

      the city is joking right?

      those two? and Josh as the wing man?

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  2. Egad! I like to come back to the comments from time to time throughout the day and with today's blog I will have to hold down my gag reflect as I view that obnoxious photo of the grinning, deceitful, smarmy, lying ignoramus Joe Mosca.

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    1. Mosca is of course a very handsome, dapper guy, and it's only because he put himself center stage that I dare to draw the comparison - but he always made me think of the braying donkey in Pinocchio.

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    2. There isn't a person alive who couldn't look ridiculous, given the right moment and a camera. In two-faced Mosca's case, there were many, many opportunities.

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    3. Twice as many opportunities, 4:17.

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    4. I know exactly what you mean Egad.
      I had that trouble a while back with the smiling lying Susan Henderson.
      Why are the Dirts and the Downtown Investment Club Members so partial to liars?

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    5. Joe's old fibs are not standing up to time very well.

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    6. good old Joe, he really duped us

      borrows a dog for his campaign photo so he'd look political and homespun for Sierra Madre and turns out to be a another fake political hack

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    7. And if and when he comes back he would win again

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    8. You really think so? I should think his Matheson connection would put an end to that.

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    9. nope, I think the slime that Joe snookered us with is now considered a pariah

      he was acting like such a brat before he moved even a neighbor who once thought he was a good guy was tired of him

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  3. I've been to DC to advocate for a project and it is hard work and a lot of walking. I'm not sure our Mayor and MPT are up for that and in the summer heat and humidity? Who pays for this junket? And the big taxi fares?

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    1. A photo with Judy Chu and a 20 minute chat with some of her staff will probably be it. And then we will have to hear all about it, of course.

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    2. We pay for it, of course. And we pay for the professional lobbyists who have been hired to do exactly the same thing.

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    3. the Mayor is packing her dancing shoes - maybe she'll have one of her batty moments and try to lead a conga line

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    4. She's dreaming of a new reality series: a re-make of Mr. Smith goes to Washington and the Kardashians mashup starring Dancin' Nancy Walsh, the senior's Mayor!

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  4. I do believe MPT* was echoing Mosca when he noted that there is "already" ten million dollars for infrastructure repair just waiting for us to pick up in D.C. Unfortunately, as pointed out by Koerber and. On firmed by the city mgr., Sierra Madre has to pony up $900,000.00 up front to get these funds. And, alas, unless the water fairy arrived last night, the city doesn't have this money. I understand October is supposed to be pleasant in D.C. Hope Nancy and MPT* have fun on the grand tour, all financed with your tax dollars and mine.

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    Replies
    1. I hope they remember to smile.

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    2. That is $81.81 a person or 20 lattes.

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    3. Josh can pay for mine.

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    4. Josh is into upside down lattes.

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    5. 7:28 - that makes sense

      because Joe and John were promising building projects like a city hall renovation and an new public library and when all of this happened, the slime balls leaped on a busted water pipe to start a panic of action to raise the 900k in a water tax so they could get the federal money

      it was a scam from day one and it's no surprise that Joe Mosca was smack dab in the middle of it - a dude who borrows a dog for a campaign photo is not to be trusted with decisions and city coffers

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  5. Kermit and Miss Piggy's big adventure.

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  6. I can hear Mayor Mean now. "We put you in Judy Chu and we can take you out." She's such a negotiator.

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  7. I think those matching Federal funds are holed up with the billions of dollars the Green Committee told us we were going to get.

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  8. I want to hear from the Tattler in France who's drinking coffee and eating pretty cakes! For every dozen totally debilitating small town political posts there should be a fanciful uplifting couple of lines from people who actually have lives.

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    Replies
    1. Is that you Marie Antoinette?

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    2. Let them eat pretty cakes.

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    3. Eat pretty cakes, get pretty fat.

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    4. And keep your lawn sprinklers running.

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    5. Let them drink wine.

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    6. Let them whine.

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  9. Traveling companions Walsh and Harabedian, now that's a pretty picture. At some point they will get on each other's last nerve, Nancy will say something incoherent or inane and Johnny will fake a doze-off and pretend he was not a party to that stupidness. If they get any help $-wise for our water problems, well, don't hold your breath.

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    1. I disagree, 8:36. I think Mr. Harabedian and Ms. Walsh have settled into a comfortable relationship of mutual support.
      And you have to hand it to the lad - he's pretty good at flattery.

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    2. At a previous city council meeting Nancy called Johnny "my three minute man." Of course she was ostensibly referring to his expertise with the public comment clock, but as a pun it was quite a glimpse into the real Nancy.

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    3. Eddie Haskell/John Harabedian: Aw shucks Nancy, I'm honored to be serving with you.

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  10. The City is looking for nominations for their annual awards. Can the Tattler get behind nominating the Alcorns for Volunteers of the Year (or whatever its called)? De and Pat represent the very best in active engaged citizenry, always looking out for those least able to look out for themselves. Send off an e-mail today. You'll feel better knowing that someone who actually deserves the award has been nominated.

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    Replies
    1. Everybody that has received the award has deserved it !!

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    2. It's Sierra Madre. Everybody gets a trophy.

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  11. Josh stated that the Bond rating was important because without a high bond rating the Water Authority could not issue more bonds in the future if the need should arise.

    Josh... The Water Authority CAN NOT issue any additional debt against the water revenues period.

    See page 11 of the Official Statement.
    "Issuance of Additional Debt"

    The Authority has covenanted in the Indenture that except for the Bonds, it will not incur any other indebtedness payable out of the Revenues."

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    1. Josh tends to engage his mouth before his brain in many situations, and/or he hasn't done his homework before giving his profound opinion.

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    2. Josh's mouth is much larger than his brain!

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    3. He is overwhelmed and overmatched. Plus he has the unenviable task of defending those bonds and by inference the people who did them. Talk about mission impossible.

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    4. I notice he doesn't like to mention that some of the water debt is interest only. Why is that?

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    5. Anything bad about Sierra Madre's huge bond debt goes against people that Josh is loyal to. He would prefer that this all get covered up, like what happaened in the first half of 2010. The 2003 bonds were a set up for the DSP. These people killed our water company for the benefit of real estate investors.

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    6. Gee, thanks, Bart Doyle!

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    7. party on Josh dude

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  12. When elected officials decide to withhold some information and 'manage' the presentation of other information, the result is what we have with the water in Sierra Madre. Getting the straight scope is nigh impossible.

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    1. It also shows the contempt the city has for residents. They talk to them like they think they're children who will never figure it out.

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    2. Or the children that will forget.

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  13. what?

    joe mosca was a liar?

    no way

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    1. He embellished with extreme prejudice.

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  14. The city always overshoots its mark in frightening residents. During a tax increase push ten or so years ago, remember the woman who got up in the school auditorium and broke down weeping about how we needed to keep all our services just the way they were? Or how about the other gal who got up and explained to the council of the time that if they touched one hair on the recreation department's head, they'd owe the state a cool million. That council was preaching end days too.

    But seriously, I do think there is a sense in which Sierra Madre is over. The water dependence, the constant development - neither bode well for the future.

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    1. The city should try a new strategy sometime. Just tell the truth. They might be surprised at the positive result.

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  15. The information on the "recreation department" was more complicated and based on misrepresenting the numbers of children that would be served in the expanded YAC and how it was financed ( under Bart Doyle, Michele Keith and Tammy Gates) money was "transferred" from open space acquisition in the foothills (acquired by the SM Mountain Conservancy). The ruse was that open space would be preserved if the city built a second story on the YAC and asked the LA County Board of Supervisors to transfer the money based on elaborate numbers of users and programs. Then when the city was trying to find ways to curb expenses and talked of reducing YAC programs this individual said the money for the YAC expansion would have to returned to the county as it would not continue to be used in the way it was stated.

    Put this on the list of damn lies that the city has foisted on the citizens over the last several years!

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    1. it appears that alot of our issues became more prominent and active once we elected Bart Doyle, a lobbyist for the building industry who recently gets investigatged for shady deals

      there is straight line of support and cover up from Doyle's term to Stockly to Torres to Buchanan to Joffe to Mosca to Moran to Walsh to Harabedian

      that line is a development line - screw the city

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  16. Wow, damn lies is right.
    What a scam they pulled on us all.

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  17. They got the budget in the wringer on that one. Have to keep up the fraud on the YAC usage numbers and programs or give the money back. Some HUD money was used, too, and that was huge curiosity!

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    1. Just another reason why Kurt Zimmerman, that great man, and former Mayor of Sierra Madre wanted a forensic audit of city hall's books.
      Kurt, you were so right. We were very unlucky to lose you, but hope you are doing well. I heard you are.

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    2. In my 39 years of living in Sierra Madre, in my opinion, Kurt Zimmerman is the best councilman/mayor we've had. Most of the others have been a collection of self-serving, egomaniac, nincompoops!

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    3. Joe Mosca was the worst.

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    4. too bad we can't afford to hire Kurt as the City Manager when he retires from real attorney work, not like that fake lawyer stuff Harabedian, Mosca and Buchanan practiced

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  18. But yet they both did the same thing, moved away from our fare city, birds of a feather.

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    Replies
    1. They moved for entirely different reasons. You couldn't find two people more dissimilar in purpose.

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