Westminster’s Diana Carey puts out an emergency call to her city’s people

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UPDATE: Have you been getting robo-calls and mailers from the scammers at “OCTax?”

Click here to read our new exposé on them and their specific Westminster lies.

You-all must know the great Westminster Councilwoman Diana Lee Carey – one of this blog’s favorite politicians.  The first to see, and start fighting, the danger of OCTA and CalTrans putting toll lanes on our “freeways” starting with the 405, and now a fighter against Poseidon’s equally kleptocratic schemes (from her perch on OCWD’s Citizens Advisory Board), she has ruthlessly seen through BS and called it BS on this whole county’s behalf.  And that’s why the late Gus Ayer and I worked tirelessly to get her onto the Westminster Council four years ago.

By all rights she should be on both the OCTA and the OC Water District, she knows so much more about the issues there than anyone else – but alas, she endangers the powerful interests (in the way we dream a good politician SHOULD!)  In fact, a host of forces would like to prevent her re-election to Westminster Council itself this year.

But there I go, on a tangent before I even start.  Westminster, since long before Diana came to power, has been OC’s financial basket case, as she’ll explain to you below.  After looking into EVERY OTHER OPTION, three of the five councilmembers – Diana, the cryptic Democrat Sergio Contreras, and celebrated octogenarian grand dame Margie Rice – are proposing a modest .01 sales tax increase, which would need to be approved by a vote of the people, after it gets put on the November ballot by FOUR of the five councilmembers.  No other possible options would get Westminster out of its dire financial straits.

Alas.  Mayor Tri Ta, the first popularly elected Viet Mayor in the US, who seems easily swayed, is currently being swayed by fellow Viet Republican Tyler Diep, a very ambitious insider-Republican who has an extremely different vision for Westminster.

Tyler’s vision, which we hope Mayor Ta tires of, is to make Westminster the next Costa Mesa, to become himself the next Righeimer, slashing services, laying off as many city employees as possible, and privatizing and outsourcing everything he can.  And Diep and Ta want to PREVENT WESTMINSTER CITIZENS FROM VOTING THIS NOVEMBER, from even having a choice between these two visions – ironically totalitarian behavior for politicians who escaped from a totalitarian country which they rightly criticize.

Diana wants to encourage as many Westminster citizens as possible to come to Wednesday’s (June 22) meeting, to insist that the full council give them the right to vote on the direction their city will go.  Here is Diana’s financial fact sheet:

ALL FRIENDS, CITIZENS AND VOTERS OF WESTMINSTER, PLEASE READ THIS:

Our City has a $12 million structural deficit, long-term shortfall; the yearly budget deficit is $5 to 6 million. The City has been using reserves to balance the budget since the loss of Redevelopment Funding. The City will have insufficient reserve funds by 2018, and the structural deficit will be at $15.5 million.

1. What caused the deficit problem?

Loss of Property tax…Westminster has the lowest return on Property Tax in the County and is 2nd from bottom in the State. Why?  Prior to the passage of Prop 13 in 1978, in order to keep our taxes low, our city councils systematically reduced the property tax rate. We were the only ones to do this. When Prop 13 passed, it put the entire State on the same formula;  however, it froze the rate of return at what was in place in the jurisdiction at the time of passage. So, for every $100 that our residents pay in Property Tax, the city only gets back $7.36. On a $500,000 home, paying $5000 in Property Tax, the city receives $368.

Why can’t we change the rate?  Because the city was incorporated prior to the passage of Prop 13. The entire State would have to vote on the change.  

Loss of Redevelopment Funds…Westminster lost $50 million in Redevelopment since 2010.

Sales Tax Revenue…Westminster has the lowest sales tax growth in the County at .63% over the last 12 years. The sales tax is 8%…This means that if you spend $60 at Home Depot, the City gets 60 cents, we receive only a fraction of that if a purchase is online.

What about cash-only businesses not paying sales tax? That is an issue. HOWEVER…even if every business in Westminster paid their appropriate sales tax, we would still need from 8 to 11 auto dealers to make up the $12M deficit. (We only have room for one)

Revenue Loss: the Utility Tax and the Bed Tax…Westminster has one of the lowest Utility Taxes at 4%, but it is not on modern devices. In 2015-16, revenue fell $500,000 and will continue to decline. (It was originally passed at 5%, but the City Council lowered it. It will need a vote of the people to revise or increase.) Every 1% raise=$250,000. The Bed Tax is the lowest in the area at 8%. (This is an issue for law enforcement because we attract more transients and violators.)

2. Can we make more cuts? No…additional cuts would affect personnel/service. The City already cut 1/3 of its work force with the loss of Redevelopment and the Great Recession. Currently the city is under-staffed, with comparatively low compensation. The police are staffed at 1975 levels, and are the lowest paid in the County. We are one of the busiest crime cities. Crime increased 25% last year:  violent crime 49.72%, property crime 39.05% (and response time improved.)

3. How will our proposed .01 sales tax help? It is an investment in the city. The tax will stabilize the budget to maintain the reserve. We will have funds to increase safety, code enforcement, and it will allow us to increase development and upgrade business districts. Is it assessed on services? No, it is not on services, doctor visits, medicines or food, etc. The good news…The 1 cent stays in Westminster, and we will receive the full amount on online purchases. (Because of the property tax and current sales tax, we are subsidizing State and County government.)

Will it hurt business? No city that did this has experienced a decrease in business:  Cities such as Stanton and El Monte had significant increases because of safety and the upgrade to business shopping areas. Stanton added 156 new businesses!  Other cities to pass sales tax measures are La Habra, Avalon, Commerce, Culver City, El Monte, Pico Rivera, San Fernando, Santa Monica, South El Monte, South Gate, Long Beach, and others. Fountain Valley is considering a sales tax and a bed tax increase, and Placentia is also considering it for this year’s election.

4. What about outsourcing the services, including the WPD?

No, we already outsource services where possible. Outsourcing means a loss of local control and a potential for increased costs. We closed our fire department 16 years ago and contracted with the OCFA. That contract increases a minimum of 5% yearly. We remain responsible for the pension obligations of the fire (and police) for the years they worked for us. Those funds come out of the WPD pension fund along with our officers’ retirements. If the WPD is contracted out, we will have no one paying into the pension fund so when it is depleted, monies will come from the General Fund causing the city to reduce services further, or go into bankruptcy or receivership.

Is the OCSD a full service department? Only if you pay for additional services. For example…Stanton had only basic OCSD service (we provide backup if needed.) In 2015, the city paid $1.6 million more than it did for the same number of officers in 2005.

Would we be able to start up again? No, the cost would be prohibitive and there are not enough officers coming out of the academy, or management transfers.  When they’re gone, they’re gone.

5. What about bankruptcy? Or returning to the County? Or receivership? We are not a good candidate for bankruptcy because we do not have debt, except pension obligations, which are not restructured. Also, any of the above have a negative effect on businesses ability to get loans, and cause reduction in all property values.

Disincorporation would need the approval of LAFCO and a vote of the people. If the city returns to the County, an analysis of the cost of providing all city services would need to be done. If our property and sales tax do not cover the cost of services provided by the county, an additional levy would probably have to be assessed upon property owners.  Under receivership (think Detroit) a trustee would sell off all assets to meet the pension obligations and other debt; probably assess an additional fee on property owners and possibly institute a sales tax. There would be a drastic reduction in services. Under all these scenarios the services we provide for seniors, underprivileged, students and the homeless will cease.

Please show up to Wednesday’s Council meeting, and let your representatives know that you demand the right to vote on the future of your city!  That’s Wednesday June 22, 7pm, at our Council chambers on All-American Way just south of Westminster Blvd.