|(July 27, 2019, 9:10 p.m.) -- The Civic Center transaction included a tear-down of LB's roughly 40 year old City Hall and Main Library; approved building a new City Hall and Main Library (with the library roughly 30% smaller than the one it replaced, LBREPORT.com coverage here); and outsourced operating the Civic Center to a private firm to whom LB taxpayers will pay an annual escalating "service fee" for 40 years.
To make the deal pencil out for the new Civic Center developer, the Mayor/Council gave the developer public Civic Center land -- permanently -- on which City Hall's chosen developer can now develop (for its profit) a high rise tower with residential units and mixed uses (food/retail, etc.)
After an initial October 22, 2013
That vote effectively reduced LB taxpayers from owners of the Civic Center land to the status of a rent paying tenant.
On July 8, 2016, city officials held a groundbreaking (photo below) that touted the Civic Center transaction.
The City described the event in a news release click here.)
[Scroll down for further.]
The originally stated objective was that a new Civic Center would cost the same (or some elected officials said "a little more") than the annual cost in FY13 dollars to maintain the existing Civic Center. A city management memo put the FY13 cost to continue occupying the old City Hall and library (with essential repairs) at $12.44 million. [Source: City staff Dec. 15, 2015 agendizing memo, p. 34.] The same memo put the hypothesized FY 13 service fee at $14.71 million and the FY16 base service fee at $15.78 million.
In the Dec. 15, 2015 authorizing vote, management sought and received Council approval to approve a base annual FY16 "service fee" of between $15.75 million to possibly $16.25 million. [Source: Dec. 15, 2015 City management agendizing memo/Council letter, p 36.] Based on LBREPORT.com's unofficial reading of the documents, it appears that the FY16 base figure came out to just under $16 mil.
That sum is important, because it will now be used to calculate annual increases based on an inflation factor that includes the Consumer Price Index (an amount the City doesn't control.) Taxpayers haven't been told exactly how much they will pay in the FY2020 budget, which the public will learn when Mayor Robert Garcia unveils management proposed FY2020 budget with his recommendations on July 31.
We presume the FY20 budget will also include roughly $1.29 million in management-acknowledged additional annual ongoing costs. [Source: Dec. 15, 2015 management agendizing memo/Council letter, p. 36.]
Taxpayers already know that the Council voted to spend $4.3 million from its FY19 budget for what city management called additional "critical technology needs infrastructure." (Dec. 18, 2018, 7-0, Richardson and Pearce exiting earlier in the meeting.) That sum included $1 million for a "media wall," which tapped the City's "Special Advertising and Promotion Fund" comprised mainly of hotel room tax on the rationale that the "media wall" qualified as displaying "public art." It took a Public Records Act request by LBREPORT.com to find out what it looks like. (For details and artist rendering at this link.) (Presumably LB taxpayers will be able to see the million dollar media wall when they're allowed to enter the new City Hall on July 29, 2019.)
As also previously reported by LBREPORT.com, the Council voted
And before a groundbreaking shovel even touched the ground, the transaction had already consumed several million LB taxpayer dollars to pay various consultants, designers, outside legal counsel and other transaction-assisters; those total sums have now gone into the double-digits.
In addition, a few weeks prior to the Dec. 15, 2015 Council vote, the Council spent $3 million from taxpayers' surplus (that became unavailable to spend for Council district infrastructure) and incur a debt bond costing LB taxpayers roughly $1.7 million each year for ten years (a sum that won't be available for police, fire, parks and libraries) to abate asbestos and in tearing down the former LB courthouse. LB taxpayers ended up paying that cost because City management assumed Sacramento would let the City tap Redevelopment sums meant to abate blight citywide to cover these sums, but Sac'to declined.
Key to transaction was avoiding a vote of the people. The Mayor/Council used "public private partnership" financing, a technique used for the new LB courthouse that the state Legislative Analyst's Office concluded may have cost taxpayers millions of dollars more than necessary.
Terry Jensen, a Long Beach native with decades of commercial property experience and a former member of LB's Redevelopment Agency Board, repeatedly raised these issues and others. Mr. Jensen didn't oppose putting the Civic Center property to better uses but after taking the time to actually read the details of the proposed transaction, came away seriously alarmed at the deal's premises and potential outcomes for taxpayer.
In a series of pieces published on LBREPORT.com, Mr. Jensen challenged management's figures, including its foundational claim that the project wouldn't cost more or "not much more" than the City currently pays to operate and maintain its current Civic Center. Mr. Jensen summed up his salient arguments in a piece at this link.
LBREPORT.com took the editorial position that the Civic Center transaction was fundamentally flawed in failing to seriously consider a seismic retrofit for City Hall and LB's Main Library. City officials acknowledged City Hall's seismic issues in 2006 but didn't move to fix them. City management never made a Request for Proposals for a seismic retrofit. The City never sought marketplace bids that would have presented options and shown the real-world costs of a seismic retrofit.
Pasadena retrofitted its 1927 City Hall. Los Angeles retrofitted its 1928 City Hall. If LB had sought to retrofit its 1977 City Hall, it would likely have required voter approval for a bond with equal (not escalating) annual payments and, according to some, would have cost considerably less.
A Columbia University graduate student's Master of Science Thesis showed how and why retrofitting City Hall and the Main Library was economically feasible and desirable on the merits. [LBREPORT.com coverage here.] The Mayor/Council didn't invite a retrofit presentation by an award winning architectural firm (in Suja Lowenthal's own Council district) whose principal had indicated that an adaptive reuse retrofit ought to cost significantly less than city management estimated. [LBREPORT.com coverage here.]
In Council study sessions, city management told the Council and public that it estimated the cost of a seismic retrofit would approach $200 million, citing seismic studies but ultimately came up with its cost figure in-house. No Councilmembers invited firms that actually do seismic retrofits to deliver presentations or offer information and cost estimates independent of management's cost figure.
City staff (which has no expertise in seismic retrofits) offered an in-house estimated cost estimate approaching $200 million for a retrofit and then used its self-generated figure to argue that it made more sense to tear down LB's less than 40 year old City Hall for an "opportunity" to get an entirely new Civic Center.
In "study sessions" hostile to other options, staff portrayed LB's City Hall as "functionally obsolete" and called the current Civic Center a poor use of public space. This stance harmonized with the views of then-Councilwoman Suja Lowenthal, who argued that a new Civic Center would "reunite" the city with its downtown (with no evidence that taxpayers outside downtown cared about or wanted this.)
Then-Councilman/now Mayor Robert Garcia argued that a new Civic Center would be "transformational." His Council successor, Councilwoman Lena Gonzalez (elected state Senator in June 2019) echoed the view on her Facebook page after the groundbreaking that the project would "transform Downtown Long Beach and cultivate a new era of job creation, public participation and community engagement."
Regarding financing (which was generally discussed in other Council proceedings), the Council held a single "study session" on financial details It did so on Veterans Day 2014 at a North Long Beach park's social hall, provided no written memoranda, only a Power Point slide show.
City Auditor Laura Doud was inaudible publicly on one of the biggest taxpayer financial exposures in the city's history. To facilitate the transaction, then-state Senator Ricardo Lara (D, LB-Huntington Park) carried a bill for City Hall that made it easier for the City to impose the 40+ year transaction.
After the Dec. 15, 2015 City Council vote authorizing the new Civic Center without a vote of the people, the Mayor/Council sought a June 2016 vote of the people to raise LB's sales tax for General Fund ("blank check") purposes. Assisted by a $600,000+ mainly special interest funded campaign, Measure A carried. On July 16, 2019, the Council voted
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