UNTRUTH SPOKEN at Council Meeting.

Tom Schwab refuses to identify the source of income for the 24 Million Dollars for FY 05-06. He said he never said that... Amount.

Well, the Council Minutes for January 26, 2006 page 4 Indicate otherwise.

Now Why is he saying he never said that? Why won't he show where the money comes from or will come from?

Mr. Harper who gets a cut off each debt we bond is happy if we are driven deeper and deeper in debt.

Conflict of Interest:? Hiding Miss Spent Money?

You can't have it both ways Mr. Schwab.


Council Minutes January 26, 2006 Page 4

City Manager Schwab, responded that the 04-05 City Budget was in excess of 10 million dollars and believes that it was closer to 12 million. The FY 05-06, he believes is 24 million dollars and the reason for the increase is capital expenditures. The RDA has not issued any new tax allocation bonds. RDA funds are being used for everyday functions. The house on Arliss is currently in escrow for $510,000.00 and when escrow closes we will make a full report on that transaction. The marketing and feasibility study on the OAC belongs to the Developer. Mr. Hays can request a copy of that document from the Developer. He encouraged Mr. Hays to look at the contract with the Sheriff=s Department because it calls for one deputy 24 hours a day seven days a week. In addition to that, we have two 40 hour deputies that are contracted to work during the balance of those shifts in one week. He stated that our contract could definitely use some additional reinforcement. The graveyard deputy does not have any back up from the City of Grand Terrace, however, because we are fortunate to contract with the Sheriff=s Department we get back up from Loma Linda and the County area. The Jacobson=s project is currently undergoing an Environmental Impact Report and when that is complete it will be given to the Planning Commission and the City Council at which time it will be a public document and available for anyone=s review.