Most Americans understand what it is like to carry debt while barely making it by every month just to be hit with a speeding ticket they can’t afford. Now they have to work twice as hard, tighten their budget and find a way to pay off an extra few hundred bucks they don’t have. But one thing is for sure, they do not get to make the case that their life is too hard and get out of paying the fine for breaking the law. Instead, they are tasked with finding the money and making payments until their fine is paid in full. And, if the law miraculously grants a concession to lift some of the burden, they do not consider it a “poke in the eye,” at least, unless they are the City of Lindsay.
When it was determined that Lindsay had misspent Measure R funds for their downtown improvement project, the County filed a claim for the entire $3.7 million project. The County agreed to settle for $1 million after an audit concluded that less than a third was used for questionable expenditures.
What the $1 million settlement truly represents is the City’s take of Tulare County’s ½-cent sales tax levied on all residents for better roads, and their decision to pour it into downtown, with few benefits to its residents. Since October of 2012, the City has been making regular quarterly payments of $18,100, including interest, until the $1 million is repaid. They are approximately 25 percent of the way through their settlement.
Unfortunately for Lindsay, their boon-doggle of a dream called McDermont has played a cascading effect on all other aspects of their financial situation. As a result, the City has struggled to cobble together a balanced budget for several years and has planned on paying off debt for decades into the future, all the while waiting for a California retirement system tsunami to devastate their coffers in the not-too-distant future. But those financial hurdles have nothing to do with the fact that the City all but stole Tulare County residents’ money and are now tasked with paying it back.
Although, that fact didn’t stop mayor Pam Kimball and city manager Bill Zigler from approaching their Tulare County Board Supervisor Kuyler Crocker about forgiving the $1 million debt. Crocker, who sits on the Tulare County Association of Governments board, brought the idea up in open session. The only measures that gathered consensus were for no interest on payments moving forward, or for a one-year reprieve on their payments. Considering that the board could have done nothing, having two options to choose from that help the City’s financial position is generous. But to the City, anything short of full forgiveness of the black eye they gave themselves was a “poke in the eye” by TCAG.
“I think if they are asking us if we’re happy with this, then no, we’re not…but right now we are in a position where we’ll take whatever we can take,” said councilmember Steve Velasquez. “They also need to know that it’s not our first choice.”
Everyone understands Lindsay’s desperate position. Like every city government, they need to maintain an aging fleet, hire more officers, repave old roads, all the while waiting for an out-of-control retirement burden poised to strike the financial heart of every California city. But a homeowner underwater on their mortgage doesn’t so much as get a call-back to talk about forgiving their loan because they find it hard to make ends meet. They still have to pay it back while also finding the money to meet their obligations despite having already paid off 25 percent. The reason why banks — and law enforcement for that matter — don’t choose to take these issues on individually is because settlements are meant to be applied equally.
The message TCAG’s concessions sends to other cities is that if you can’t afford the entire payment, or if it is inconvenient, then ask for some sort of reprieve or maybe they can lift the entire interest rate. Woodlake, Exeter, Farmersville, Visalia or any other city in Tulare County would positively misspend money on their downtown and then only have to pay the principal back citing financial difficulties. Obviously that would be wrong, like asking for and giving concessions is wrong.
When Lindsay took Measure R funds and applied it to their downtown, they also took with it the public’s trust. To earn that trust back, Lindsay needs to demonstrate they are worth trusting by recording a history of goodwill by first paying the money back to Tulare County residents and getting their house in order to illustrate responsibility; they’ve already done one of those things.
TCAG will take up a formal vote on the matter at their next meeting on Feb. 19.