Guest Commentary: No More Tax Increases Until City Management Fixes What Is Broken

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Disclaimer: Opinions are those of the writer and do not reflect those of The Vanguard or its Editorial Staff.  The Vanguard does not endorse political candidates and is committed to publishing all public opinions and maintaining an open forum subject to guidelines related to decency and tone, not content.

I am voting no on Measure Q because it is an attempted bailout for ongoing city management problems, including:

  • A history of poor City leadership to overcome our resident NIMBY power that has led to too few housing units, too few local businesses, and dismal sales tax revenue per capita.
  • A history and trend of City politicians over-paying City staff working for unions and associations that contribute to their political campaigns.
  • A failure to fund basic City services like road maintenance while spending on frivolity.
  • Evidence that our City is deficient in its financial management practices.

On this last reason, members of the City Council and City management have been quoted saying that the most recent financial audit is “clean.”   However, the Auditor’s January 24, 2024, Memorandum on Internal Control (summarized below) identifies the following serious problems:

  1. A number of material closing entries had been omitted or needed to be corrected.  In addition, during the audit, we discovered and/or City staff proposed six additional post-closing journal entries.
  2. Bank reconciliations had only been completed as of July 2020… a full year behind.
  3. The Treasurer’s Report for the quarter ending September 30, 2020, was not prepared and reviewed until December 23, 2020, and was not submitted to the City Council until February 6, 2021.
  4. During fiscal year 2021, City staff determined that a loan made in fiscal year 2019 in the amount of $1.98 million had not been recorded as a loan receivable as required.
  5. During the current year audit, we followed up on the status of Significant Deficiencies identified on the Status of Prior Year Significant Deficiencies. We found that the following deficiencies had either been partially or not mitigated at June 30, 2021.

■             2020-001 Segregation of Duties – Accounts Payable Process and Review

■             2020-002 Segregation of Duties – Payroll

■             2020-003 Purchasing Policy Compliance and Use of Purchase Orders

These noted audit deficiencies, including a repeat of problems found in the prior year audit, are indicative of dysfunction in the organization’s financial management and controls.

The problem with rewarding City management with tax increases is that it shelters them from having to do the needed hard work to fix what is broken in the system.  At the very least Davis residents should demand that the City Council and City management clean up their financial management act before asking us to dig deep in our pockets to give them more of our hard-earned dollars.

 

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37 comments

      1. If I remember Jeff Boone’s stance on development, frankly he was for business parks but like me not so much for housing tracts. If I’m incorrect about that Jeff can weigh in and correct me.

  1. Hey, I’m all for transparency. So yeah, lets get those records out in the open and squared away.

    As far as City Leaders over coming NIMBYism? I think you forgot that the City Leaders represent the views and opinions of the people and it appears NIMBYism is alive and well in Davis. Everybody wants more affordable housing (affordable or more market rate)….just not in their own immediate backyard. Everybody wants to keep the streets from becoming congested with traffic; it takes infrastructure expansion to mitigate the impact of more housing on the streets…but where is the funding for that infrastructure expansion coming from?

    I hate the city’s fiscal philosophy and lack of economic development plan too. But the city (the people) have pretty much said that they don’t want real and serious economic growth so the only way to pay the bills is to pay more taxes.

    Voting No on Measure Q is essentially like having the mortgage come due, you need to pay for groceries but your plan to solve this is to go back to school, get a degree to get a really good job and not ask your parents for some money to pay for things or pay for some things with a credit card.

    So if you think maintenance is bad now; not having a way to pay for it isn’t going to make it better.

    1. Keith Echols said … “ I hate the city’s fiscal philosophy and lack of economic development plan too. But the city (the people) have pretty much said that they don’t want real and serious economic growth”

      Keith, I too hate the city’s lack of an economic development plan, but I don’t agree with you that the people have said they don’t want real and serious economic growth. I strongly believe that if there were a plan in place … and my recent meeting with Katie Yancey, the City’s new Economic Development Director was very heartening on that possibility … then the people would support that plan.

      1. Personally I’m of the belief that a plan is simply a mechanism to kick the can down the road when the powers that be don’t want to do something they perceive as unpopular. Most people in town don’t know if there is or is not a plan, and won’t participate in creating one. And yet a plan takes somewhere between 2 and 5 years to plan. Then given a project takes between 2 and 5 years to get approved and another 2 to 5 years to build, that puts any progress out at least 10 years. Given that the city needed revenue and jobs yesterday, that’s not a very efficient process.

        1. David, I suspect if you talk to Katie Yancey, she will tell you that putting together an Economic Development plan that the city’s constituents can respond to and then understand and rely on will not take 2 to 5 years. I suspect it won’t even take 12 months.

          Similarly, the process of conducting outreach to the community regarding Vision shouldn’t take more than 14 months, so we can start 2026 with a foundation for the future.

          1. David
            I was in that meeting with Matt. Yancey has a well thought out time table. And many of the strategies will not take 2-5 years to implement. Many will leverage what we already have here now. So I disagree with your assessment.

          2. I don’t doubt that. Color me a skeptic at this point – there are too many veto points in the Davis process at this point.

          3. Richard: “I was in that meeting with Matt. Yancey has a well thought out time table. And many of the strategies will not take 2-5 years to implement. Many will leverage what we already have here now. So I disagree with your assessment.

            Both you and Matt opposed the last economic development project in town. Why should anyone trust your assessment here?

            The City has been discussion economic development for the better part of two decades, yet we are wondering where to start. Do you really think that more planning will result in a changed outcome?

            We have a City Manager who has no significant work experience with, or apparently, appreciation for economic development. His experience is tax, spend, rinse, repeat. Why do you think things are going to change now?

          4. Mark once again you have your facts wrong. Richard very clearly and conspicuously supported DiSC 2 … the “last economic development project in town.” You really would benefit from an effort to get your facts straight.

            Regarding the City’s two decades of economic development discussion, if the sum total of all that discussion were turned into the UC Davis Business School for a grade it would receive an “F.” It had absolutely no assessment of market demand, and no discussion of what kind of bottom line return should be expected. All that was discussed was market supply. Doing only one third of the job is abject failure.

            To Katie Yancey’s credit, she is paying considerable attention to both market demand and market supply.

      2. If the people wanted serious economic growth; then the council would seriously promote it. The Council either agrees with their constituents on limited growth or knows that a pro-industrial and commercial development platform isn’t popular. Actually, the concept of pro-industrial is popular (jobs) with the people…until hit hits their backyards when they start to consider traffic impacts…etc…

        Good leadership should be pushing for an economic development plan. But it probably won’t and maybe can’t come from the council. Outside forces (local and external pro-business and growth types) are going to have to convince the people and influence the council to get things done.

    2. Keith, I am hopeful that Katie Yancey’s work can bring an end to the era where Davis has had no idea where Davis is going … or wants to go.

      Mayor Chapman probably thought he was providing leadership when he said at the LWV Forum on Measure Q, “Davis people want to look forward and move the community in a different direction.”

      That statement has two significant challenges/flaws, both of which are fixable. The first challenge/flaw is that neither Mayor Chapman, nor any of your fellow City Council members have articulated what that “different direction” is.

      The second challenge/flaw is that despite the rhetorical reference, the Davis people haven’t been consulted on what that different direction might be.

      I’m not sure that Mayor Chapman himself could give a description of what that different direction might be.

      When I got to Davis in 1998 it was clearly a University town with organizations like DATA trying to leverage the stream of intellectual capital coming out of the UCD campus. But in the 25 years since then Davis has arguably abdicated that designation and evolved by default into a bedroom community … by default being the key words. The inventory of intellectual capital in our City is arguably half of what it was in 1998. The number of practicing professors and researchers who live in the City Limits is probably no more than 25% of what it was in 1998. Intellectual capital intensive businesses in Davis are fewer than they were then … and there is virtually no collaboration between UCD and the City to incentivize the intellectual capital created on the campus to stay in Davis.

      I truly believe the people can and will approve real economic development if they have been provided a clearly articulated direction for the future that they have had some input into that direction’s creation.

      1. Matt Williams: “I truly believe the people can and will approve real economic development if they have been provided a clearly articulated direction for the future that they have had some input into that direction’s creation.”

        “The point is, ladies and gentlemen, that greed, for lack of a better word, is good. Greed is right, greed works. Greed clarifies, cuts through and captures the essence of the evolutionary spirit. Greed in all of its forms. Greed for life, money, love, knowledge, has marked the upward surge of mankind, and greed” -Gordon Gekko “Wall Street” (1987)

        What gets things done are people that want to make money. These are the people that push projects through come hell or high water (which is always the case….even in pro-development communities). You can put together a plan all you want. But ultimately it’s the people that want to make money in your community that is going to achieve your economic development goals. The best a community can do is pick what proposed projects works for them…which is always a square peg in a round hole process.

        The problem with Davis is a vocal few who have a trumped up sense of themselves and their desire for input in every process. It gums up the works. The process is supposed to be representative. The people’s desires are supposed to be reflected in their elected leaders. But here’s the thing; their elected leaders don’t always have to go with the wants of their constituents if they know the alternative is a better (often long term) course of action. It’s up to the leaders to convince the people and to simply be judged/re-elected based on the results. Getting too many people involved gets suggestions like moving I80 or putting a dome/tunnel over it.

        1. Keith
          First Gecko is a fictional character, and more importantly, that quote is meant to be a sarcastic skewer of the culture of the time. In fact, Gecko’s “perspective” is incorrect. Even Adam Smith (a real person), to whom this sentiment is misattributed, warned against the hazards of relying soley on greed. Making money is an important motivator but it is not the sole motivator. Quality of life, community connections and sustainability are also strong motivators.

          The community can shave the corners off the square peg of the a development if it has a strong will. Many other places are able to carry out planned, coordinated development. Why should Davis cede this ability?

          This town is much less hierarchical than you make it out to be. It’s not only the elected Council members who have a say in what this city does. The history of Davis is full of unelected citizens acting to get things done. Most of the nice amenities of this city have roots in those types of citizen actions.

          1. Lighten up Francis! -Sgt. Hulka “Stripes” (1981)

            Lol…what kind of fun would it be to quote Adam Smith? Thank you for your insightful analysis of the dangers of unfettered capitalism. I feel admonished because I was seriously considering the benefits of unchecked capitalism based on a quote by a movie villain was relevant.

            You miss my point. MAKING MONEY IS HOW YOU AFFORD A QUALITY OF LIFE. ..you know fixed roads, more roads/better traffic…better city services. And those business ventures and projects ultimately happen because of GREED (you try starting a business and getting financing without a projected healthy ROI/IRR).

            Many other communities are able to make developments happen because their leaders (not just the ones on the council) make it happen. THEN they sell it or convince their constituents. Projects and growth happen because people want to make money. That’s the point of the Gekko quote. You can plan until you’re blue in the face but until you’re willing to court/work with/get out of the way business and development people….instead of seeing them as some problem that you have to mitigate into submission….all the planning is pointless. Can you invisible hand your way to make growth and development a benefit to the community? To a degree as long as you stay out of the way….but ultimately it’s about making money for all parties involved and it’s that way that the invisible hand is pulling tax revenue towards benefiting the community.

            Again, you miss my point. I’m saying the town isn’t hierarchal enough. I’m the one saying that it should be leadership by representative. Look at the state of Davis right now; how’s that history of community involvement working out? Nice amenities? We’re lucky to get a playground renovated. I don’t even go to the movies in Davis anymore. I hardly eat out here anymore; aside from some basic take out. I go to Sac and the Bay Area for entertainment and I shop mostly in Woodland or online.

  2. I agree with Keith Y. Echols that we have failed on economic development and therefore it’s time to pay the tax piper.

    The irony is that the same people who were outspoken in opposing the DISC project are now against higher taxes. Chutzpah pure chutzpah.

    1. Ron G
      What’s interesting is that people who supported DISC are against Measure Q. Elaine is the best example of that. You’re painting the opposition with a much too broad brush.

      1. Yes some were for disc that are against Q but I wasn’t writing about them. But since you raise the issue some who fall into that group are being quite petty by wanting to punish the community over the almost completely unrelated issue of commissions demonstrating a level in of political immaturity that I find wanting on many levels.

    2. Ron, as is frequently the case you have conveniently revised history to match your biases. I never complained that I didn’t know who the tenants of DiSC were. My complaint was that the Ramos-Oates development team (1) had no marketing plan for their project, and (2) were explicitly and publicly clear that they would not even begin thinking about a marketing plan until they were awarded entitlements for the property.

      Early in the DiSC process I made a strong argument that the development should have a lead tenant because the MRIC project did have one, but Keith Echols and others clearly explained why that was a bridge too far.

      1. somehow the new innovation center that is going to Woodland instead of Davis doesn’t seem to have issues about landing tenants. Maybe it’s the location or maybe it’s Measure J. In either case empirical evidence suggests you were wrong about this issue that you articulated as a fatal flaw for disc.

        1. Ron, once again your research before you speak falls short of the mark. The Woodland Innovation Park has no tenants, and according to the City of Woodland website is still in the planning stage.

          1. David, you are referencing something different from the innovation park that was proposed for land near Sutter Davis Hospital that abandoned Davis and went to Woodland.

          2. David, did you read the article? That is an internal consolidation of multiple sites for a single company into a single facility. Monsanto did the same thing several years ago and in the process moved the 5th Street Davis operations to the new building in Woodland.

          3. “ Sakata America Holding Company, a major subsidiary of Sakata Seed Corporation, has opened its new headquarters, the Sakata Woodland Innovation Center, in Yolo County, California.

            The state-of-the-art facility, located on 219 acres of prime agricultural land, will serve as the central hub for the company’s operations, consolidating the company’s key functions into one campus, including research and development, seed production, processing, testing, packaging, distribution and biotechnology.”

          1. The Sakata Innovation Center is north of Woodland on Road 100. The Woodland Research & Technology Park is south of Woodland on Road 101, west of Spring Lake.
            The Sakata Innovation Center should have been located in or adjacent to Davis. It’s a natural fit and the reason they located in this area is the proximity to UCD. Why didn’t they locate next to Davis? I suggest that should be the focus of our discussion.

          2. I agree with Don Shor that why they didn’t locate next to Davis should be the focus of the discussion.

            Sakata’s Woodland campus is located three miles north of the Woodland City Limits. They purchased over 200 acres because like HM Clause which is one mile south of the Davis City Limits, they need fields to grow their seed research crops.

            Per Sakata, they purchased the land in 2016, and the Woodland facility officially opened in 2018, when “phase one of the building project was completed, which boasted 16-acres of operational facilities, including greenhouses, a LEED-certified office, headhouse, washery, a 25,000 square-foot warehouse, featuring the latest technology in seed processing equipment, and farm shop.” There is also land to serve as the company’s trailing location, R&D department and annual California Field Days.

            In May of this year, Sakata also opened a new facility in Marina, California, near Salinas. The Sakata Marina Distribution Center is a 20,000 square-foot, temperature-controlled warehouse and office building. It is home to the company’s lettuce seed program and, in the future, will store and deliver multiple species, including Sakata’s brassica program, for the Coastal California region in 2024.”

          3. It would have been a perfect fit for Mace Curve or Chiles Road. In either case, part of the land can be in the county, part in the city. Or the whole project could be in the city. Except that requires annexation. Which requires a Measure J vote. So it wouldn’t happen.
            This is a good example of a project that could have and should have been considered for Davis, but wasn’t because it’s too hard to do things like that here.
            More examples of the difficulty locating businesses here came up recently when
            — the Wendy’s building had to be evaluated (seriously) for its possible historical value, and
            — the vet clinic that wanted to open locally had to be rejected (per staff) so it could be appealed to the planning commission.
            https://www.davisenterprise.com/news/planning-commission-approves-cup-design-review-for-chipotlane-upholds-appeal-for-vet-surgery-center/article_35671968-875f-11ef-a06d-e75bf801a026.html

  3. It is also interesting that on both DISC and Measure Q Matt Williams makes a similar argument. With Disc he complained that we didn’t know who the tenants would be despite being told repeatedly that it was impossible to lock in tenants before a measure J vote. With Measure Q his complaint is that the city won’t say how they will spend the money although he is fully aware that a general fund tax can only be allocated through the regular budget process.
    It seems Matt like these sort of straw man arguments but there is no reason any of us should fall for this nonsense.

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