Swill Buckets

by Mark Scaramella, March 10, 2011

We’ve heard it many times: Don't you understand? We have no money! The cupboard is bare! It's a structural imbalance! Our ability to borrow is jeopardized! We have no reserves! The Sheriff is overrunning his budget! Patrol Deputies will have to be laid off! Health and Human Services will have to be cut even more! Everybody has to take a cut! The County simply has no more money! We can’t keep kicking the can down the road! We can’t keep betting on the come! Next year it’s going to be even worse! There's no money! Comprende, you fools?

Except.

Except for Wine and Tourism. We of course just happen to have a spare $300,000 for the wine and scented soap brigade, sometimes known as the tourist industry. If they raise $600,000, which some of them carry around as pocket change, the County adds $300k, for a total of $900,000 a year spent on reminding the six million people of the Greater Bay Area that two hours north there are the splendors of Ukiah and Willits, er, the Mendocino Coast.

As the sage of British journalism famously put it, “Advertising is the rattling of a stick inside a swill bucket.”

Mendocino County's well-heeled, privately-owned wine and tourism juggernaut are furiously rattling their sticks in a bucket of swill that just happens to contain $300,000 of public money, our money, money that's in very short supply.

Visit Mendocino County's president, Scott Schneider, told the supervisors that if they don't get the $300,000 it will “stop the heartbeat of the travel industry throughout the county.”

First off, when we talk wine and tourism in Mendocino County we're talking about the narrow strip of redwood and sea running from Boonville to Westport. If that's what they wanty, any Bay Area traveler curious about inland Mendo can buy a case of Two Buck Chuck and head for nearby Daly City.

Visit Mendocino County, with zero supporting evidence, claims that their promos bring tourists to Mendocino County. Without Visit Mendocino County only the most dedicated  of the pastel-sweatshirt crowd would come here.

Mendocino County Code Section 5.140 was established in 2006 creating the “Business Improvement District” (BID) whose purpose is “to provide revenue to defray the cost of services for activities and programs that promote tourism which will benefit the operators of hotels in the district [i.e., the County] with the promotion and marketing of hotels and related products including scenic, recreational, cultural and other attractions.”

For more than ten years now the Board of Supervisors has voted to help the Hospitality Industry “defray” their costs to “benefit the operators of hotels” in the County.

The ordinance that formed the BID says that if the County doesn’t chip in its entire $300k, “the BID is null,” according to Lodging Association's Jason Hurst.

The theory of the $300k and the BID itself is that it brings in more than $300k to County coffers. Maybe it does, maybe it doesn't. Nobody knows, but we'd bet people would still visit the Anderson Valley and the Mendocino Coast without the taxpayers trundling $300 grand to a bunch of grape-soaked yuppos.

Mendocino Republican Central Committee Chairman Stan Anderson, speaking in the local tradition of bipartisan unreality, sternly told the board, “I strongly oppose the $300,000 cut proposed by CEO Angelo,” adding that tourism brings in so much money and the County gets “a great return on its investment.”

What ever happened to get government off our backs, Stan?

In fact, there’s never been any proof that the public gets any “return on investment.” Back in the late 1990s the Grand Jury questioned the promotional money the County was spending and asked for a detailed accounting.

The Promotional Alliance (as Visit Mendocino County was then called) stonewalled the Grand Jury, haughtily claiming hat they were a “private business” even though at the time they got 95% of their money from the taxpayers. The Grand Jury even took the Promotional Alliance to court to challenge their status as a “private company” since it got 95% of its funding from taxpayers.

Judge Richard Henderson quickly ruled against the Grand Jury, saying that the Bed&Booze Boutique people’s 5% private money was enough to make them “private.”

The Grand Jury merely wanted the Promotional People to prove that there was some correlation between expensive ads in the Chronicle and Sunset Magazine and our tax-funded dinners for those gastro-frauds who claim to be influential wine and food critics.

The sticks beat heavier in the swill bucket.

The Grand Jury's sensible request for evidence that the money was well spent was ignored.

But every year since the promo people claim without them nobody would visit Mendocino County, let alone take home a bottle of $40 booze.

Schneider himself says that the wine and tour industry's 1% levy on themselves brings in $600k, which the County half-matches with its $300k as it lays off patrol deputies and crisis psych techs. If that's true, why doesn't the BID simply raise its levy to 1.5% and take in another $300k on its own, wouldn’t that bring in oodles more touri and money for them? And more county revenue?

The Supervisors were so eager to fork over the $300k to the "Swelliban” as Willits’ Don Morris has aptly dubbed the County's wine and cheese mafia, that the supervisors even apologized to them for CEO Carmel Angelo’s terrible, terrible decision to put the $300k on the list of items that could be cut. “She wasn’t recommending that the money be cut,” Supervisor McCowen explained, simply listing it as an option for the chopping block, along with several other non-mandated expenditures.

Mr. Schneider, as if he were announcing a re-write of the Sermon on the Mount, read out a letter of support for the $300k from former Clerk of the Board of Supervisors Joyce Beard.

“If Joyce Beard puts her stamp of approval on anything it’s good enough for me,” Supervisor Pinches quickly declared, prompting us to wonder if the old girl might be persuaded to write in favor of sparing the Sheriff's budget any more cuts.

Supervisor Pinches seems to have forgotten Ms. Beard and her husband weren't exactly what you might call entirely devoted to the financial welfare of either Mendocino County or the State of California when, in 1998, and while she was still functioning as Board Clerk, the CHP charged her with chiseling the DMV by registering her RV in Oregon to save a few bucks on license fees, technically a felony. The Beards bought a $57,000 motor home (worth at least $100k in today’s dollars, an indictable offense all by itself in a sensible world) in Alameda County, but registered the beast in Oregon where the Beards own property, thus avoiding some $5 thou in registration fees and vehicle taxes required by California where the Beards happen to live full-time.

When the Beards discovered the CHP was on the case they quickly re-registered their road mansion but committed another felony — perjury — by under-valuing the monstrosity by $15,000. Of course, thousands of well-heeled and not so well-heeled Californians buy and register their transportation in Oregon to save taxes and fees if they can, but someone in her position should have known better. At the time, friends of Mr. and Mrs. Beard howled at the Ukiah Daily Journal for even printing the news of the Beards’ felonious nickel-nosing on the grounds that the couple hadn’t been charged yet, an argument we never hear from the the lions of Rogina Heights when the chiseler happens to have an annual income under $50 thou.

Supervisor Hamburg, gingerly prefacing his inquiry with prophylactic praise for Visit Mendo, and please forgive him the impertinence but he was just doing his job, asked about how much of the money goes to the BID’s admin.

Mr. Schneider responded that their costs are admirably low because they deploy local yuppies to seduce the gastro-scribes, not the more costly trendies of San Francisco. (A case of free wine and a $50 free meal will not only get you all the ink you want in the moribund SF Chronicle, for wine and a good dinner that paper's food and wine writers will throw in an array of flamboyant sex acts the city's famous for. Our supervisors might ask Schneider to cut them in on that action too.)

Nancy Cliburn, president of the Mendocino Music Festival  but unrelated to the famous Van Cliburn, praised Visit Mendocino because they “put us in touch with wine writers and got us into social media. And we know the effect that can have. Look at the Middle East!”

God's teeth, spare us.

Repeating the popular but utterly false myth that Egypt’s Tahir Square movement was the product of American compu-gizmos and not the Egyptian people, Ms. Cliburn returned to her seat where she suddenly spread her arms wide and screamed “AND WE HAVE A TENT!” (Which she seemed to be wearing, but her exclamation was more likely intended to remind the audience that the annual Mendo Music Festival takes place in a big tent out on the bluffs.)

Ms. Cliburn's may have been the gushiest gush, but the merry burbling for public handouts continued: The chipmunk painters of the Arts Council, Jeff Stanford of the Stanford Inn, Ruth Sparks of Heritage Days of Mendocino County, former Supervisor Hal Wagenet who said he “supports the BID,” and was appearing “hat in hand” although his head remains, as always, so far up his whatever it also serves as a hat. And Mendocino Transit Authority’s Glenna Blake said she was appearing with her “Promotional Alliance hat on” and said that her own organization was “a model organization.” (If your idea of a model organization is ghost riders on heavily subsidized buses, MTA is indeed a model organization.) Maryanne McGee of Mendocino Coast Clinics said her office somehow benefited from booze promotion. And of course Congressman Mike Thompson’s local rep, Heidi Cusick, who writes about her boss’s only real political interest group every week in the Ukiah Daily Journal (to the complete and utter exclusion of every other business or organization in the area) told the Board how she and her boss are great admirers of the organization they have come to love.

Even the usually sensible supervisor Carre Brown told the B&B-BIDers that she was “impressed,” and that she heard their ads on KGO radio about the annual Crab and Mushroomfest. Smiling broadly, Supervisor Brown added, “$300,000 is a small amount for the work that gets done.”

Having lobbed a few nerf balls at the promo axis, Supervisor Hamburg praised the tourist economy, calling it “the largest legal part of our economy.” (Har de har.) “I really don’t see this as a contribution to the tourism industry by the County. If you look at what’s generated, it’s only 8% of the bed tax going back to the industry. It’s a small percentage of what you contribute.”

Supervisor Pinches, momentarily in repossession of his senses, laughed as he wondered, “Do we really have $300k to give? I guess we’ll put that decision off until tomorrow.”

Board Chair Kendall Smith then called for a voice vote. 5-0.

Unanimous.

The audience of high end welfare recipients broke into loud applause, and were soon milling around shaking each other’s hands, clapping each other on their plump backs, wrapping their dewlapped arms around each other for great big huggsy-wuggsies.

Oh what wonderful people we are! What a wonderful County we live in!

Wunnerful, wunnerful, wunnerful.

* * *

After an hour of muddled back and forth, the Board concluded that the best way to choose a redistricting committee for Supervisorial districts would be to simply call for applicants and pull names out of a hat. Redistricting occurs every ten years after the publication of census data.

As the discussion rambled on, it was clear that Pinches and McCowen were strongly in favor of the pull-out-of-the-hat method. Board Chair Kendall Smith disagreed, saying that she didn’t want randomly selected rabble fiddling around with her district boundaries, and that a team of County staff, plus a couple members of the League of Women Voters, ought to make up the redistricters, thus ensuring that the Northcoast's pathetic Democratic Party apparat would do the redistricting.

But in the end, Smith went with the other Supervisors to approve the much fairer random selection approach. Supervisor Hamburg described the random selection approach as “throwing caution to the winds.”

Toward the end of the meeting after CEO Carmel Angelo and Chair Smith told the Board that the County was looking at big increases in the County’s pension contribution — $4 million next year and $4 million more the year after that — Supervisor Pinches asked about the huge difference between the County’s two auditors on the value of the pension fund.

“The auditors can’t even agree on the value of the retirement system?” asked an indignant Pinches. “There’s a $43 million difference? What’s going on?”

Supervisor Smith, of course, had no clue. But having no clue has never prevented Smith from weighing in: “Well, I think that it depends on, eh, eh, eh, certain factors we’re, eh, talked about as we’re, we’re, we’re not agreeing on certain sets of information…”

Pinches: “And we’re dealing with an employer’s contribution that’s $5 million off!”

Smith: “That’s true. Yes.”

Pinches: “We’re not talking about small numbers. We’re talking about the total book value of the retirement system. One guy says it’s $300 million, the other guy says it’s $343 million!”

Smith folded her arms and leaned back as if she was tired of Pinches asking embarrassing questions, but she’d let him ramble on if she must.

Pinches: “I mean, we’re not talking about small differences.”

Smith: “There are clear discrepancies. Now we have EFI…”

EFI is the new auditor/actuary who recently completed a very critical review of the retirement system, finding many “mistakes” that the old actuary had made right under the noses of Smith and her fellow Retirement Board members. EFI’s report is the one that recommends significant increases in County contributions in the year after next.

Pinches: “Well, it makes you wonder if either one of them are right!”

Smith: “Well, let me know… what you will be… what we will be doing is going out for new actuarials for, going forward because EFI was only going to critique the retrospective, um, information in the RFP when they were selected because they are not allowed to be the, the, um, ongoing, um actuarial firm. That was a safeguard put into the RFP process. They will be taking a look at options going forward.”

The experienced blatherer knows that he or she can wow the wowzers with a lot of fancy terms — actuarials, critique, retrospective, safeguard, RFP process, going forward — while saying absolutely nothing.

Pinches surrendered into silence.

* * *

Coincidentally, Supervisor Smith appeared on last Friday morning’s KZYX radio show hosted by former Supervisor Norman de Vall.

de Vall’s questions regarding the County’s doomed pension fund elicited these responses from Ms. Smith:

“We should look at that.”

“We may have not necessarily taken a good path.”

“We should remain vigilant.”

“We should make sure that those aspects don't occur with respect to Mendocino County.”

“I think we are doing that.”

“Mendocino ought to do everything in its power to cap costs to present employees.”

“That's also the job from a different angle of the retirement board.”

Smith sits on Retirement Board, and if your golden years depend on her, well, good luck ol' dawg.

“Two things I mentioned to you is [sic] the vacation hours and the sick leave. Now that's built into the formula. Mendocino County should look at can we change that? Some of these are related to collective bargaining agreements, others however may require that we get special legislation passed. Sonoma County has that with respect to the COLAs. Some of those items would come to us in the domain [sic] of collective bargaining. What I'm asking the CEO and the Executive Office Staff to do is take a very very critical look at, and maybe perhaps create a graph, what is in the purview [sic] of the Board of Supervisors, what is under the collective bargaining agreement, what is under the government code section, and sections that are adopted, is that the purview of the Retirement Board or the County, and what do we need special legislation, whether the specific section of the retirement code, would, that Sonoma County has that says, we, we, we remain uh, uh, uh, flexible with respect to COLA and the Board of Supervisors has the authority to designate a COLA. We don't have that section in the 37 act adopted. I am going to be asking that we look into how do we adopt the section that Sonoma has.”

* * *

PS. In a Mendo Listserve posting last week, the County's Senior Independent Pension Watcher John Dickerson made the following observation (among many others): “I have very little faith in the accuracy of the Pension Fund's financial reporting. Huge obvious errors in their financial statements are not corrected or explained. For example, the latest audit shows the Fund received $14.7 million in employer and employee contributions last year. The Actuarial Valuation says they got $19.4 million. The audit reports the Fund's net investment return was $38.1 million; the Valuation reports $44.9 million. The audit reported $11.5 million less than the Valuation in Pension Fund revenues last year. Apparently the Retirement Administrator — responsible to fulfill a $435 million commitment of the County — didn't notice the difference. Nor did any of the Retirement Trustees other than Ted Stephens. There are many examples like this.”

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