Grand Terrace agrees to pay off $2.3 million debt over 10 years
GRAND TERRACE - After nearly five months of closed-door negotiations, the city agreed Tuesday night to pay almost $2.3 million owed to the San Bernardino Valley Municipal Water District.
Grand Terrace learned of the debt in May, after the water district realized that in fiscal years 2008-2009 and 2009-2010, the county Auditor, Controller and Treasurer's Office used the wrong formula to calculate the amount Grand Terrace's redevelopment agency needed to pay to the district.
Despite early agreement on the basics of a repayment plan, details were repeatedly changed because of a law abolishing all California redevelopment agencies - which was passed in June, along with another law allowing cities to pay to maintain the agencies, then stayed by the state Supreme Court - said City Manager Betsy Adams.
"This is an item that's been in closed session a long time, and some ancillary issues still are but we can now report the debt and that the water district gave us 10 years to repay it," Adams said. "It was extremely generous of them to do so, and I think it's important for that to be publicly acknowledged."
The court's stay prevents redevelopment agencies from entering into new agreements, so the council - which also sits as the board of the redevelopment agency - agreed to repay the debt out of city funds.
The debt was discovered as Grand Terrace grappled with a $50,000 general fund deficit. Finances remain extremely tight in the city.
It has long leaned heavily on the redevelopment agency, but moved to issue bonds to develop infrastructure and alleviate that dependency at the same time the debt came up.
That put the city in the precarious position of acknowledging the debt to bonding agents while keeping negotiations details private until now, a dilemma Councilman Bernardo Sandoval said Adams and the council handled perfectly.
"Our city manager made the very conscientious decision that we would not go out for bonds without addressing this issue," Sandoval said Tuesday.
"(Also,) everybody on this council has really been very assertive to report out the items on closed session as soon as we are able. I want to thank my colleagues for that level of integrity and transparency."
The incorrect payment amounts also mean the formula used to determine how much Grand Terrace must pay to retain its redevelopment agency is wrong, factoring into the city's earlier decision to appeal that amount, Adams said.
The Inland Valley Development Agency owes more than $6.5 million to the water district because of the same error, according to county records
GRAMPS SAYS: TRANSPARENT AS MUD
There would be no reason that the above matter had to be resolved behind closed doors. YES this fits in the Can be or May be behind closed doors however, this is the very type of issue that CAN be discussed in public IF the City Council and City Manager wanted to be TRANSPARENT.
Why should we know about this type of negotiation and problem facing the City. Well this issue has an impact on other Council Decisions or Indecision, Actions or Inaction. The public should know what is the issue, what are the complications and what is the progress of the issue as it is being resolved. It is unlikely that the PUBLIC has any control over the out come. It is also a reality that the water district could say pay up now and kill the City of Grand Terrace, but it is seldom in the interest of an agency to kill off it's clients. That would be bad business practices.
When Bernardon Sandoval, Walt Stanckiewitz, Darcy McNaboe were running for City Council Positions they promising more TRANSPARENCY they have not maximized that promises sufficiently. Gene Hays an appointed Council Member also said he believed in transparency. This leave Lee Ann Garcia who no doubt went along to get along.
A debt issue is not a Payroll issue, it is not a matter of National or even City Security. Your a bunch of misguided leaders who think the public is either too reactionary, or too dumb to have these serious financial matters and negotiations in public view as they transpire. This is why the public or the governed does not trust its government.
Let's hope the next election cycle produces a set of Council Members who want true Transparency and will hold all Agenda Items that CAN be discussed in public are in public.