Watch Your Wallet Archives - Friends For Fullerton's Future

July 1, 2024July 1, 2024Ahmad Zahra

Boutique Fun and Games With Johnny Lu and Larry Liu

FFFF has already reported on some of the colorful financial background of Johnny Lu of TA Partners, our City’s stand-up partner on the so-called “boutique” hotel project at the railroad tracks. This hot mess even has a name: The Tracks at Fullerton Station. The development has morphed into a monstrous minotaur by adding approval for a massively dense apartment – an amalgamation which gives us a shocking 130 units per acre, overall.

Well, anyway, we previously shared the news that Johnny was in default on massive construction loans he somehow finagled for projects in Irvine a few years ago. The lender on those has foreclosed on those properties.

And here’s some even more recent news. It seems that Johnny has waded out into more legal problems over in LA, according to The Real Deal, a real estate news source. Here’s the thrust of the complaint by bamboozled investors on a “project” at Playa Vista:

“The investors — who form an entity called RUC14 Playa LLC — sued Lu, Liu and TA Partners, alleging commingling of funds, fraud and misrepresentation, court records show. Attorneys for TA Partners, which have requested for arbitration in the case, did not respond to a request for comment.“

Johnny and his partner, Larry Liu, declared their bankruptcy on the Playa Vista project. But let’s give the misunderstood boys a break. A little contrition goes a long way, right? Said Larry:

“We would like to offer our apology for the non-compliance during project execution,” Liu wrote in the letter. “Self-reflection is needed and I would like to apologize.”

Whatever any of this means to “TA Westpark LLC.,” the corporation that was awarded the Fullerton project entitlements (without any competition) remains to be seen. But now Johnny and Larry have equity – and boy have they got equity; see, Councilmembers Zahra, Charles and Whitaker handed them a bonanza – a plot of land available for hundreds of units – for a mere pittance: $1.4 million less associated costs.

Ms. Charles happened to mention at a council item about raising funds for Fullerton’s fiscal disaster, that the boutique hotel plan was moving along. But there was no mention of the fiscal disaster facing Johnny and Larry Enterprises. Does she even know? Does she understand what is happening? Does she care? Probably no on all three.

The plan here is crystal clear. At this point nobody is going to lend Lu and Liu a bent nickle. But these fine fellows will have entitlements worth tens of millions on this project; a project that never should have happened in the first place – an unsolicited proposal by a local guy who had no chance of building a birdhouse.

This project will be reassigned to a third party, someone the City “business development” expert bureaucrats will be sweet-talked into recommending. And then Johnny and Larry will quietly disappear from Fullerton with millions belonging to us.

Fullerton being Fullerton.

June 29, 2024June 30, 2024Ahmad Zahra

Bungling Boutique Boondoggle Blunders

by The Fullerton Harpoon12 Comments

Some folks have been asking about the fate of the idiotic “boutique” hotel project that had morphed into a hideously overbuilt hotel/apartment hippogriff that is twice the allowable density permitted per the City’s own Transportation Center Specific Plan. Of course the project was never contemplated at all in the Specific Plan, so who cares, right? Fullerton being Fullerton.

In an act of utter incompetence the City actually rushed the approval to transfer of title to the land, before the deal had received final approval. Then they gave it away the land for pennies on the dollar.

Friends may recall our last October post in which we discovered that the new “developer,” one Johnny Lu of TA Westpark LLC, was way upside down on loans he had somehow leveraged on apartment blocks in Irvine and was in default.

You may also recall that Lu started shifting the property to different corporations, the first of which, a Delaware corporation, was non-existent. And just for grins, Mr. Lu changed the property description, too, when he later deeded it back to his California Corporation.

Anyhow, it looks like Johnny has finally created and recorded the appropriately named Delaware corporation in March – only two years too late, but, hey, not bad for Fullerton, right?

There has been nothing but radio silence from City Hall as to the status of Mr. Lu and whether he has met any of the stipulated deadlines in the Development and Disposition Agreement, but as we have learned in the case of the Florentine/Marovich sidewalk heist, contractual obligations mean nothing when the “I Can’t Believe It’s a Law Firm” of Jones & Mayer is your City Attorney. Recently, cluelessly verbose Shana Charles indicated that the project was still alive and well. She didn’t mention Mr. Lu’s financial embarrassment, but then nobody else has, either.

And now for some sadly interesting news. It turns out the original Founding Father of the boutique hotel concept, Craig Hostert of West Park Development – the guy who sold the idea to Jennifer Fitzgerald, Jan Flory, Jesus Quirk Silva, Ahmad Zahra, Bruce Whitaker, et. al. – died in late May.

Poor guy. He went to his Reward after getting pushed out of his own scheme, and sticking us with the appalling, metastasized mess the concept has predictably morphed into; showing that once again, no bad idea goes unappreciated in downtown Fullerton. Being Fullerton, of course.

June 13, 2024June 13, 2024Ahmad Zahra

Revenue Enhancement Time. Plus Lies and More Lies

by Joe Sipowicz8 Comments

Last Tuesday the Fullerton City Council voted 4-1 to approve the ’24-’25 city budget. Whitaker, as usual voted no. The budget projects big deficits as we’ve already heard.

After that the Council was presented with “revenue enhancement” ideas – the same old nonsense that we’ve already talked about, here. At first these ideas were simply floated to make it look like somebody had given some thought to find other ways, however silly, to address the tsunami of red ink; but in reality the point was to push a general sales tax, a movement that had been subtly going on for many months.

However the proposals agendized last Tuesday did not include a sales tax this fall, a sure indicator that the City Manager has polled the Council and knows he doesn’t have the votes to put it on the ballot. But that didn’t stop Councilmembers Charles and Zahra from pitching and pitching and pitching the idea; and finally supporting each other to get the issue of a sales tax on the an agenda, pronto, in time to schedule it for the November election.

But before that happened the public was treated to some of the most blatant and self serving re-writing of Fullerton history I have ever heard.

If I knew what I was talking about this wouldn’t be Fullerton!

Shana Charles started off with long-winded blabbering that was irrelevant, self-contradictory, confusing, and erroneous. Of course – “decimated” staff, the ill-effects of right-sizing,” reduced response times – the usual liberal litany of problems were simply meant as an introduction to the sales tax proposal. Her complaint was that previous councils had made mistakes, not by exercising fiscal restraint, but by “cutting to the bone.”

Charles then lauded the wonderful benefits that the City of Placentia derived from it’s Measure U sales tax that saved it, having declared bankruptcy – a statement completely false. She failed to mention the fact that Placentia has saved millions by getting their “fire fighters” out of the paramedic business, an idea of which her Fullerton fire fighter union pals are terrified.

While patting herself on the back for very recent staff and service level increases, she failed to see the rich irony of her own incompetence on the edge of a precipice: a situation well-understood when she voted for last year’s budget.

More economic development, better wardrobe…

If Charles blathered nonsense, Zahra just lied about Fullerton’s recent fiscal history, most likely because he has been on the City Council for 6 years, and has his greasy fingerprints all over the budgetary disaster.

According to Zahra, our problem reaches back decades and only now is the Council addressing the problem. Of course our City Councils have made bad decisions over the years, but the current disaster is of very recent vintage and has also occurred while he has been on the City Council.

For several years in the mid and late teens Fullerton was dipping into reserve funds to pay the freight, even as Zahra’s allies Jan Flory and Jennifer Fitzgerald and Jesus Quirk- Silva were lying to the public about the budget being balanced. It wasn’t. In fact the City continued in its cavalier way until Fred Jung and Nick Dunlap joined Bruce Whitaker on the council in 2020.

Measure S Covid Lie — Let me count the ways…

Zahra related how he, as a precinct-walking candidate, noted how people wanted better roads and how his predecessors had promised them, too, but that they failed. He didn’t note the fact that Fullerton’s public safety employees were hogging up bigger and bigger shares of the budget – as they still do.

The subject of Zahra’s failed 2020 Measure S sales tax came up, a sore subject, apparently, since his underserved constituents in D5 voted for it. So let us not stop from revisiting it, and right now! Charles chimed in that well she people she spoke to voted against it because there was no sunset provision, and, get this – because there was no oversight committee!

As an aside, I have to share that Zahra made an hilarious little speech about he could not support an infrastructure improvement bond because voting for municipal debt would keep him awake at night!

Bruce Whitaker made just about the only insightful comment of the discussion, namely: that cities can control costs but they can’t control revenue, an observation that flies in the face of the revenue enhancement propaganda, but that is perfectly true. As has been stated here before: nobody even knows if an Economic Development Manager even pays for himself in terms of incremental tax increase.

I will wrap this up by acknowledging a Zoom caller who actually did make a good revenue enhancing and who identified a huge fiscal problem: downtown Fullerton, the annual sinkhole that makes millions for the scofflaw club owners and that leaves the taxpayers with a $1,500,000 bill. He suggested a special assessment on these eager party entrepreneurs to pay for the havoc their booze and their customers cause. Not surprisingly, none of the council members even mentioned the problem. They never do.

June 11, 2024June 11, 2024Behind Closed Doors

Chapman Parking Structure Deeded to City

by The Fullerton Harpoon16 Comments

A while back FFFF noticed a item forecast on the June 4th Agenda dealing with the property bounded by Whiting, Chapman, Pomona and Lemon – a parking structure built about 30 years ago for reasons still unknown. Curiously, the staff report calls it a “parking lot,” ignoring the fact that it’s actually an elevated parking structure – an asset that cost several million to build. The accompanying Quitclaim Deed only refers to parcels of land on the original Townsite Map, but doesn’t describe improvements on said lots.

According to staff it was built by the downtown Fullerton Parking Authority – which isn’t quite true because the parking district didn’t have any money. It was built by the Fullerton Redevelopment Agency which raised lots of money to waste on stuff like this.

Anyhow, the agendized item turns out to be a paperwork issue to deed miscellaneous portions of the site to the City from the now dead “Parking Authority.” The item was dutifully approved by our City Council.

Obviously, nobody caught the omission when the parking agency expired (another Jones and Mayer success story), but now the timing may suggest that the “opportunity site” as identified in the otherwise unrelated and never-ending “Fox Block” fiasco has attracted the attention of City Hall’s Monopoly-playing, “economic development” bureaucrats.

June 5, 2024June 4, 2024Ahmad Zahra

New Well. Same as Old Wells

by Fullerton Engineer19 Comments

A new testing well has recently appeared on Walnut Avenue next to the source of trichloroethylene contamination at 311 South Highland Avenue. Friends may remember that this contamination has been monitored by the Feds and the State agency responsible for tracking such things. Here’s the drill rig crew hard at work installing the well casing.

Of course FFFF has already noted the existence of the contamination of the property and its neighbors in the context of the dismal $2,000,000 Trail to Nowhere, pet project of Ahmad Zahra and his colleagues on the City Council; FFFF also identified ten testing wells on the trail site, plus a couple more in the middle of Truslow Avenue. Apparently testing is now taking place to the north, on Walnut Avenue, too. That’s not very good, is it?

The City of Fullerton claimed and still claims that there is no problem with their trail site and apparently the State Natural Resources Agency, the bureaucracy that doles out grant money, remains incurious as to why no mention of trichloroethylene has ever been made by Fullerton’s environmental consultants in their reporting.

Meantime the City continues its silence about the growing plume that could be moving northward, too.

Of course public employees are indemnified for their activities, no matter how incompetent or based in misfeasance. It’s the public that gets to pick up the check.

May 23, 2024May 23, 2024Bad Cops

A Shameless Hustle

by Joe Sipowicz26 Comments

A good Friend received an interesting piece in the mail the other day, and sent it in to FFFF.

It’s a solicitation from Scott Flynn, President of the FPOA – Fullerton Police Officer’s Association – the cop’s union in Fullerton.

It seems your support of the police union “has been a beacon of hope that has helped fuel many initiatives to make our community a better place.” Somehow your donation helps the cops with their “support” of all sorts of philanthropic efforts. What that support might be is left to the imagination of the reader.

If you give them some big money you will get incredibly valuable gifts as a “VIP.” An “engraved” tumbler and a “custom donor plaque” will be yours for the low, low price of $1000.

Of course the solicitation is based on the idea that the giver isn’t very bright. The obvious first thought is that if you put the FPOA’s decal on you car somewhere, you might just avoid getting that next, expensive, moving violation. Could that be true? I don’t know, but the thought obviously crossed the minds of the solicitors and the donors.

Second, if you look closely at the piece you notice something interesting.

Of course this operation isn’t a non-profit and you can’t deduct your donation. In fact the FPOA exists for only two reasons: first, to use its political influence electing councilmembers to squeeze evermore higher wage and benefits out of the citizenry; and second to remain as unaccountable to the civilian authority as possible.

The whole thing is hardly different than any other mail scam trying to get people to part with their money. There is no charitable purpose here, just a way to get people to support a public employee union by pretending to be doing good works.

Why wouldn’t any intelligent person simply donate to the real and worthy charity of their choice, and get a tax deduction, too?

May 18, 2024May 18, 2024Ahmad Zahra

What’s Wrong With This Picture?

by Mr. Peabody57 Comments

Downtown Fullerton saw a ribbon cutting this week for “Madero.” It’s not a new place. It used to called “Matador” but an El Matador already existed in Costa Mesa and the story goes that Mario Marovic, proprietor of the Fullerton place, got sued and had to change the name of his establishment. So an event was held and here’s the scene:

The guy with the green hat is Mario Marovic. That name sure rings a bell.

Right. He’s the scofflaw who got caught squatting on the City’s property on Commonwealth Avenue – the legacy of the Tony Florentine sidewalk theft. When that came out Marovic made a deal with the City to remove the egregious “bump-out” and to be complete by July 2023. Oops. Nothing has even started, 14 months after the start of work deadline. And we know that the City Council has been presented with some sort of legal claim by Marovic, because it was on their Closed Session agenda.

And who is the little guy on the left standing next to Marovic? Why it is none other than the District 5 Councilman Ahmad Zahra, dressed in his usual ribbon-cutting attire, palling around with Marovic and even giving him some sort of City proclamation!

Now, we all know that little Ahmad is a notorious attention hound and desperate photo-op seeker. We also know that a City Council agreement isn’t worth the paper it’s written on. But this is really too much. Marovic is still squatting on public property and it looks like no one in City Hall has the balls to enforce an agreement signed by Marovic himself. Instead the City seems to be actively socializing with him.

May 17, 2024May 17, 2024Ahmad Zahra

Revenue Enhancement

by The Fullerton Harpoon18 Comments

M. Eric Levitt. Will he save us from ourselves?

It seems like every few years Fullerton City Councils are presented by the bureaucracy with a new “fiscal cliff”: It’s done slowly, tentatively, and then with an ever-increasing tone of persuasion, the argument for “revenue enhancement” unfolds.

Revenue enhancement means taxes or debt – one way or another. And so it is in 2024.

With time running out to put a tax increase on the November ballot, the urgency from “staff” is getting more direct. Time has run out for soft-sell concepts like phony push polls of unwitting citizens. At Tuesday’s council meeting our esteemed City Manager is presenting ideas for raising money.

TOT Tax. What is a TOT tax? Transient Occupancy Tax is a tax levied on visitors who stay in Fullerton hotels. The staff report tells us that several million can be raised with a slight increase and that hopefully we will remain competitive because we are so close to the Anaheim “Resort.” No on can prove this one way or another, but it seems like becoming comparatively less competitive is a poor way of raising revenue. The positive thing about a TOT increase, says the staff report, is that Fullerton taxpayers won’t be affected (unless, of course the concept turns out to be a money loser).

Sales tax. We have already seen the sales pitch on how a general sales tax only needs 50%+1 to pass. We are told that a “1%” increase (from 7.75 to 8.75) on sales tax is being pursued by cities up and down California, etc, etc. Of course they think we’re too dumb to know that this isn’t a 1% increase, but a 13% increase. As with a TOT increase, it’s hard to see how becoming comparatively less competitive is going to make money. The sales tax issue seems DOA. 4 votes are needed to put this on the ballot and Whitaker and Dunlap aren’t going for that.

POBs. And then we see the concept of Pension Obligation Bonds, in which bond revenues are deposited with CalPERS to buy down the actuarial unfunded liability. The idea is that the interest rate on the bonds is lower than the return CalPERS will give us and the difference is all gravy. This idea was floated back in 2021 by then Interim City Manager, Jeff Collier. FFFF covered the proposal, here. One upside is that this scheme is not constrained by the usual debt ceiling limits placed on local governments by the state. Great. More gambling.

Well, there she goes. Don’t worry. There’s more where that came from…

Mr. Collier was kind enough to visit our humble site to educates us on POBs. Friends immediately pointed out the risks involved with POBs, and the lack of skin in the game Collier and his pals had. And that was three years ago when market interest rates were way lower. The equities market is now going through the roof so the idea looks appealing to our bureaucrats, but not to California pension system observers who note CalPERS ever-declining return assumptions and remember the disaster of 2008. Will the City Council approve this gambit? It’s possible, and a public vote is not required.

These various options involve raising taxes or encumbering property to some extent. That’s risk with a speculated payoff. Ahmad Zahra is bound to support anything risky and foolish so as to protect his friends in City Hall. So is Shana Charles, another liberal torchbearer who will tell us this is for our own good; or for the urban forest; or for boutique hotels, or something else nonsensical. Whitaker won’t go for any of this nonsense. Dunlap? Who knows these days. And then there is Fred Jung who had the opportunity to be the third vote to shut down talk of revenue enhancement last year and didn’t.

A problem with any tax revenue increase is that the increase, such as it were, will immediately be snatched up by the so-called “public safety” employees, whose unions have the clout to grab what they want and everybody else be damned. That’s exactly what happened in Westminster a few years when the cop union pounded the pavement for a sales tax increase, got it, then gobbled it all up. And Westminster is right back where they were before.

May 7, 2024May 7, 2024Behind Closed Doors

Coming to a Theater Near You

by Disillusioned Ex-Hippy15 Comments

On this week’s Fullerton City Council agenda I caught a glimpse of the upcoming May 21st agenda forecast:

AGENDA FORECAST (Tentative)
Tuesday, May 21, 2024

APRIL 2024 CHECK REGISTER
MONTHLY COMMITTEE ACTIVITY AND ATTENDANCE REPORT
DISPOSITION AND DEVELOPMENT AMENDMENT FRONTIER
COSTA COURT AREA STREET REHABILITATION PROJECT
ALL CITY MANAGEMENT SERVICES CONTRACT
SENATE BILL 1383 COMPLIANCE ACTION PLAN FOR SERVICES AND PROGRAMS
CHAPMAN PARKING LEASE
FOX BLOCK
REVENUE OPTIONS

Not all that interesting until you get to the bottom.

Yeah, it was ugly as sin, but there sure was a lot of it…

The Fox Block, a never ending saga and a classic example of a tail wagging a dog. For years the “rehabilitation” of the historic Fox Theater structure has been used to support all sorts of God-awful lunacy, including residential land acquisition and demolition, new grotesque clown architecture, and the six million dollar relocation of the McDonalds restaurant a couple hundred feet to the east. The “Fox Block,” as the boondoggle came to be known, is a living fossil of the bad old Redevelopment days, when any nonsense could be got away with by City staff playing with Monopoly money. Damn accountability. It’s the Fox Block!

Why this is on the agenda is as yet unknow, but I noticed that one of our Friends “Fullerton Historian” suggested it may have to do with extending a development agreement or some other similar concept. Then I saw the third bullet point above: Disposition and Development Amendment with Frontier. “Frontier?” That’s all? What is this? Frontier Real Estate is our “partner” on the Fox Block, meaning we’re probably taking the risk and they’re goon get any reward – if there is any.

And finally we see an item simply called “Revenue Option” an oatmealy sort of phrase, but one that FFFF has already discussed. At this meeting the City Manager, Eric Levitt, will try (without too much unseemly enthusiasm) to tie dangling threads heretofore described here: a push poll created to drum up support for enhanced public services; a review of the likelihood that general sales tax might pass at 50%; and a precipitous budgetary cliff looming ahead.

See where this is going? Let’s see who stands up and demands that for our own good we must have a tax increase.

April 30, 2024April 30, 2024Behind Closed Doors

Surprise: High School District Wants More of Your Money

by Mr. Peabody11 Comments

Just in case you thought the City of Fullerton was the only government agency that wants to put their hand in your pocket, you can think again. Back on April 9th the Fullerton Joint Union High School District held another one of those ridiculous “workshops” where the only work going on is push polling designed to get the school board to put yet another school bond on the ballot.

This item was agendized under the harmless sounding title of Facilities Master Plan Update.

This was none other than an opportunity for the school district’s army of six-figure educrats to sing the blues about how they need hundreds upon hundreds of millions of new property taxes to bring the wonders of technology to the districts underserved teenagers.

Just as the City did, the high school district employed the kindly offices of a consultant, True North, to do a poll. And guess what? The consultant (who specializes in managing technology upgrade projects) informed the Board that indeed, yes, their survey of 695 individuals indicated support for a bond, perhaps not realizing that district property owners are still in the process of paying off two previous facilities bonds and will be doing so for another twenty years.

Well, there it is. As with Fullerton, the District will need to adopt a resolution pretty quickly to get this bond on the November 2024 ballot. These things usually are timed with annual budgets although assuming a victory at the polls remains iffy, indeed.

In March of 2020 the FJUHSD’s Measure K – a deceitful operation from A to Z – went down to defeat. So did the Fullerton Elementary School District bond attempt, Measure J, on the same day. Will the FSD try another bond double-header like they did last time?

Stay tuned Friends and let’s see what happens in June. And like last time we’ll be reporting on the Bond Sales Industrial Complex to see who’s funding such an attempt.