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April 14, 2021 - Epoch Times
26:09
How California's Distribution of $8 Billion Federal Funds is Devastating Small Cities | Beth Haney
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There were seven tranches of monies that were coming down from the federal government.
The federal government gave it to the state and then the state divides it out.
One of them was the funding for cities as far as like the COVID-related impacts.
What is the thinking behind this way of distributing the funds?
The larger cities, they received anywhere from $85 to $174 per person, whereas the smaller cities, we got the $12 per person.
To say that the people that live in the smaller cities aren't worth as much as people in the larger cities, that was troubling to a lot of us.
What's going to happen to a city like Palm Springs?
They've had to decrease their city staff.
I mean, all of us have basically had to cut.
So people usually are not paying enough attention to these issues until it's too late.
Right.
And then who do they come to?
They come to the city leaders.
And they say, well, why did you let this happen?
What have you done to our beautiful city?
During the pandemic, some cities wanted to break out.
They wanted to create their own health department.
They were frustrated with the rules.
Have you guys noticed that the smaller cities want more autonomy now?
Well, all of us want local control maintained.
California received $26 billion, including $8.4 billion, that will be divided amongst local cities through the American Rescue Plan.
My guest today is Beth Haney.
She's the co-chair of the California Mayor's Coalition.
Today she discusses how the state government is allocating this funding to the cities and why small cities are looking for more autonomy.
Welcome to California Insider.
Beth, it's great to have you on.
Welcome.
Thank you.
Nice to be here.
Now, cities were facing some budget shortfalls, a lot of cities in California, but all of a sudden they got a lot of money.
And they got it based on size.
So how's this happening now?
Right.
So it's getting allocated depending on population.
And there were seven tranches of monies that were coming down from the federal government.
The federal government gave it to the state and then the state divides it out.
And so one of them was the funding for cities as far as like the COVID-related impacts.
And so The larger cities, there's 13, what they call the big 13 in California, they have populations of 300,000 or more, and they received anywhere from $85 to $174 per person, whereas the smaller cities of 300,000 or fewer people, we got the $12 per person.
So those numbers were based on the impacts of COVID on the homeless.
And so that's how they decided that people in smaller cities, which people in smaller cities, they make up 72% of the entire California population.
So to say that the people that live in the smaller cities aren't worth as much as people in the larger cities, that was troubling to a lot of us.
So you guys, they said that this is based on the homelessness.
Was that the logic?
Because they had to, why was that?
They had to spend money on the homeless during the pandemic?
I would think, yeah, they were looking to spend more on, say, PPE or sanitation projects, you know, to help, you know, curb the public health crisis.
So now when I thought about this, I actually think about like Silicon Valley where they didn't really get impacted.
Those companies, a lot of the tech companies are doing really well.
And then you have a city like Anaheim where conventions got shut down.
Oh right.
And everything was on tourism.
Right.
And they got really impacted.
And then we have Palm Springs.
We were mentioning offline that they got impacted big time.
What is the thinking behind this way of distributing the funds?
Oh, well, we were all dismayed at all of this because it was very unfair what was going on.
For example, you know, Anaheim, they depend on their theme park revenue, the taxes from that, the hotel tax.
You know, those types of things.
And all that pretty much got wiped out.
And the same with Palm Springs.
You know, Palm Springs is very tourist-based.
And so when we're not, you know, we weren't allowed to have conventions and fill our hotels and theme parks, you know, it really impacted all of that.
For example, some of the funding that Riverside got.
So Riverside had a $28 million hit from COVID last year, and they got $28 million from the federal government.
So, or sorry, from the state government.
And so, Palm Springs, on the other hand, had a $47 million hit, and they got $600,000.
So it was completely...
Wow.
The disparity is huge, and that's...
That's just not, it just wasn't right.
And so that right there, so the mayor at the time, his name was Jeffrey Kors, and he, the mayor of Palm Springs, he's my co-chair for the California Mayors Coalition.
And that coalition is, we have almost 160 mayors and former mayors in California.
That are members of this coalition and our main focus is to get all cities, regardless of size, but especially cities under 300,000, a seat at the table so that we can get the best For our smaller cities, which, you know, the smaller cities make up 72% of the California population.
So to treat the 72% of the population as lesser than is not fair in our eyes.
And so what are they going to do?
They're getting only that little amount of money.
What's going to happen to a city like Palm Springs?
I don't know.
You know, they're going to have to really tighten up their budget.
I know that they've had to decrease their city staff.
I know that public service also, law enforcement.
Recreational programs, all of that, they've had to cut.
I mean, all of us have basically had to cut those types of things.
Luckily, in Yorba Linda, where I was mayor in 2020, we didn't have to cut any law enforcement.
We didn't cut any services.
The only ones that we had to cut down on were the senior and the youth programs, only because of the parks and rec and the...
The social distancing and those types of things.
And we also closed City Hall for walk-ins, but you could still make appointments.
But we were functioning on a skeleton crew during the past year or so.
And we just heard that LA has gotten double the amount of funding that they needed, the shortfall they had.
This doesn't make any sense how the funding is getting distributed.
You have a city that has to cut services and then you have another city.
And I think they're putting some of them in their reserves.
Or I don't know if they can keep it, but they were wondering what to do with the excess amount.
And then you have another city that has to cut from the services because they didn't get enough because of their size, right?
Right.
You know, exactly.
And so, for example, Yorba Linda, I was re-elected to the City Council in 2020, November.
Which is great because I can continue my public service.
We have a very fiscally conservative council.
And we keep in our reserves 50% of our operating budget.
So we have done well throughout this pandemic because mostly our revenue is from property taxes and sales tax.
We don't depend on hotels and theme parks.
So we've done well.
As a matter of fact, we have a slight...
A surplus in our budget because of, you know, how we've maintained our funding.
But we are getting $12 million from the feds.
It's kind of like, okay, so we're trying to find ways, or we are looking at ways to spend that money.
I mean, we could always use it, but it's kind of like, gosh, you know, someone like Palm Springs or a city like Palm Springs, maybe they could use...
A little more, you know?
I'm not saying to take the money from Yorba Linda, but what I'm saying is, what was the target?
It doesn't seem like there's any purpose.
And especially with hospitality and conventions and places where they had, we decided as a state to shut them down.
And we made that decision.
And now they have to pay for it.
That seems like what...
Now, with these coalitions of mayors, what are the challenges that you guys have faced during this pandemic time?
So it's really a wonderful coalition, and we're trying to get to 250 members.
It really is a great thing.
It's bipartisan.
We are not a political group at all.
And it was founded by the former mayor of Fullerton, Jennifer Fitzgerald.
And so now Jeffrey Kors and I are the co-chairs.
It's a great group because we can talk amongst ourselves, all of the leaders of these cities in California, about the problems that we're facing.
Is it housing?
Is it homelessness?
Is it law enforcement?
Is it the ramifications of the protests?
You know, all kinds of things.
And so we can actually Decide what we want to do based on best practices from other cities, how they have learned through different aspects of the COVID and the pandemic problem.
And a lot of the cities, like what I saw in the LA County, especially during the pandemic, some cities wanted to break out from there.
They wanted to create their own health department.
They were frustrated with the rules.
Have you guys noticed that the smaller cities want more autonomy now?
Oh, well, all of us want local control maintained.
Uh, we know the leaders of the cities know what the cities and what those residents, those particular residents want and need.
So, um, Los Angeles was really cranking down on the lockdown.
And for example, I believe it was Pasadena that was going to, they wanted to create their own county health department and, or their own city health department, because they were like, you know, Los Angeles is clearly not following scientific guidelines.
They're going way above and beyond, and they're destroying the economy and not helping anyone.
And so there were cities that wanted to break away from Los Angeles to create their own health departments, basically.
And there were even a few in Orange County that were considering that as well.
Senora Belinda, we have much different priorities than, say, San Jose or Los Angeles or Santa Ana or Villa Park.
I mean, all of the cities are so different, even just geographically.
Some of us are in the hills.
Some of us are at the beaches.
So we really need to maintain our local control.
It's so important.
And the residents are the ones who suffer when the governor makes these sweeping mandates that are going to apply to every city equally.
When it doesn't work equally well.
And most of the time they're unfunded mandates.
So now the cities are forced to come up with money to try and fund these mandates that might get thrown at us.
And then some people, you were mentioning offline that some people, with the homelessness issues in LA, some people, some of the homeless went to the coastal cities.
Yes.
And the coastal cities got impacted, but they're getting the funding At the very minimal, like $12 per person versus the LA city that's getting it at $200 or $187?
$174.
They're getting about $174 per person.
So what happened to these cities?
So the smaller cities got $12 per person.
And it was supposedly broken down on the homeless impacts of COVID. So cities like Malibu and Santa Monica and the coastal cities.
But they have a lot of problems.
Santa Monica has a lot of homelessness, right?
Well, I don't know if it's a lot.
Okay.
Yeah, definitely an increase.
Lots of things are happening at the coastal areas, too, because people are flooding.
They've been flooding to the coastal areas to go to the beach and all that.
And so, interestingly, some of the cities, some of the city leaders were telling me that They're actually getting a little boost in their revenue because people are ignoring the parking laws and the traffic laws.
And so those cities' revenues, the beach cities, some of them are going up because of the money coming in from tickets.
Yeah.
So that was interesting.
So what are some examples of these mandates?
Housing.
There's housing mandates.
And, you know, we're being told how to spend our money.
We're being told how to zone.
You know, they're trying to push that through right now.
How to zone our single family lots, you know?
So even decisions like that, they want to make everybody, every community unified?
Everybody's the same.
Everybody's the same.
It doesn't look like it's working with the funding, the way the funding is distributed.
Right, but the funding is certainly not equal at all.
So it's really hard.
It's really hard.
And so that's one reason, a big reason that we, all of us in city leadership, we want to maintain local control.
The residents are the ones who are going to feel it.
And the residents are the ones that are looking to us as the city leaders like, what are you guys doing?
You know, why aren't you, why are you allowing this apartment complex to go right up next door to me, you know, in my single residential neighborhood, in our beautiful, quiet cul-de-sac?
Now there's going to be a 10 unit apartment house, you know, next door.
And it changes the whole landscape of everything.
It's not that we don't want people to live in the town or the cities, but there's areas that could be much more conducive, like in shopping areas to have, I love how they have those The shopping underneath and then the apartments above.
I think that's a really great way to do it and they're new and beautiful.
Unfortunately, that doesn't help with the lower income housing or the affordable housing.
That's more market rate and those are other issues that Sacramento is trying to push down on us that You know, you need to build these apartments, you need to build new housing, split up the single family lots to make them two lots with four doors on each.
But there's no parameters for affordable homes or affordable housing.
So the developers can come in and build these beautiful luxury units.
It's not going to help.
So there's no mandate on affordable housing on those, but when you want to build an apartment complex, If you do a high-rise, you have to have, there's a mandate on affordable housing side of it.
There's some mandates.
There's some affordable mandates in developments now, but what's coming down the pike is a little bit different.
So before you guys had a lot more control on this type of issues, on the local issues?
Right.
So for example, there's one, the ADU, which is an accessory dwelling unit law that is now in effect.
So your next door neighbor, if you live in a single family home neighborhood, your next door neighbor, which is fine if you want to do this, but they can put up to two units in In their backyard, if it's big enough, and have two more families or two more people living there.
No regard for parking, no regard for sanitation, water, nothing.
So it's...
So you guys have to figure out, as the cities, how to handle those.
The only thing that Yorba Linda can do is have a little bit of input on the design.
And the state is deciding all of this.
And you guys are mandated, the cities are mandated to create a lot more, to have a lot more housing because of the problems we have.
We have housing problems.
I don't know if it's a shortage, but the costs are going up and up and up.
Right.
So all the costs are going up.
So they keep saying that we have a housing shortage and we don't have a housing shortage, in my opinion.
In my opinion, we have an affordable housing shortage.
And yet the bills that are up there right now are not, they're not addressing affordable homes.
They're just saying you can split your lot, you can put eight doors on it.
However you want to do that, you go right ahead.
And then how are you going to ensure that's going to be affordable?
You can't.
There's no, it's just going to go at the market rate.
Market rate housing, exactly.
So, I mean, things can change.
There's, you know, the amendments come and go.
So, but that's, those are the types of reasons that we want to maintain local control at the city level.
And do you think you will be able to maintain local control or is it that difficult?
I don't know.
It's a fight.
It is a fight because the legislature is just passing, they're writing bills, they're passing them, and they're turning into law.
And it's like, what can we do about it?
You know, once it comes down to us, we...
You just have to follow the law.
But you guys have your coalition.
There's 70% of the population is in your...
Exactly.
So we're hoping, you know, and we're trying to grow.
We are growing.
We're growing.
We're adding more and more members.
We want every mayor in California to join because we definitely, we have a stronger voice when we are united like that.
And the effort of having more autonomy is a nonpartisan effort, right?
Absolutely.
Nonpartisan.
So it doesn't have to do with any political...
No, no, no.
It's just the city councils and mayors, they want to have more control.
Because, you know, if you're a leader of a city and you want more building, you want to bring in more housing, oh my gosh, please do.
You have the ability, the...
The wherewithal to do it, then do it.
But to force all cities, like for example, Del Mar, small city, very, very small.
There's wetlands in Del Mar.
So the state is forcing Del Mar to also build more.
I forget their number.
So they're being forced to build, and there's no place physically that they can build, but they still are being forced to do it.
And they're like, okay, well, are we supposed to build in that marsh, in that mud puddle there?
I mean, how are we, how do you do that?
So it's quite a challenge.
So that's the other thing, you know, that some places want to build, but they can't either physically or geographically or what have you.
I mean, you're Belinda, we have no problem putting, we have beautiful affordable housing units that have gone in.
They're absolutely gorgeous.
And there's a waiting list for them.
So there's definitely a need.
But we also have some properties that are available that we are looking to put more affordable housing on.
It will have to be approved by the voters, but still we have areas.
But there are some areas that we do not want to build because it's a fire hazard.
The wildfires were on a border of a very dry hillsides.
And we don't necessarily want to put houses where there's going to be a big fire risk, or flooding, or there's other issues.
But for the state to come down and tell you, you need more houses, we don't care where you put them, just put them somewhere.
It's dangerous, really.
You guys sent a letter to the congressional leaders on the funding issues.
Can you tell us more about the letter you wrote?
Sure.
So that was with the California Mayor's Coalition.
And we signed on to a letter to Nancy Pelosi and the California delegation, just pleading basically to ensure that the cities get direct funding from the federal government in the American Rescue Act.
And so we sent off the letter thinking that they would use some kind of economic logic and have a perhaps targeted approach to delivering the money and dividing it up between the cities.
We never really hear back from them.
We send the letter asking for support, but we don't really hear back.
So targeted meaning that you wanted the certain cities to get more funding based on how they've been impacted?
Based on per capita, yeah, and how they're impacted.
And then you didn't want them to send the money to the state.
Right.
But the money did go to the state and the state divided it, right?
Right.
So what do you tell the residents in these cities?
How can they help the mayors and the city councils to work on this autonomy?
So we, you know, during our meetings, one of us will usually, you know, bring this up like, hey, who you vote for to get up in Sacramento is going to affect us here.
And Peggy Wong, who's the current mayor, she's very involved with the housing issues.
And So she'll bring up, it's like, hey, you know, please write your letters.
You've got to get these letters into, you know, the Southern California Association of Governments or you've got to, you know, do this and then I'll bring it up and try and get people engaged on social media just to kind of get it out there.
What we don't like to see happen is the residents wake up one day and go, hey, Oh, great.
Now you want to put this in that area or this in my backyard or whatever it is.
And it's like, we've been telling you about it for the last two years.
Nobody's paying attention.
So it's really difficult.
So what we are trying to do is get more visibility through the California Mayors Coalition.
We also have an Orange County Mayors Association group that we meet every other week.
And we do press releases, we do public service announcements, you know, so we are really trying to get the message out there.
But, you know, unfortunately people just aren't, they don't seem to be as engaged as they could be.
Not until it hits them.
So people usually are not paying enough attention to these issues until it's too late.
Right.
Because, I mean, hey, is housing interesting for people?
Is that an interesting, you know, not for many, not until it's in your neighborhood, you know, that you have an apartment.
Here's an apartment complex.
Oh, it's beautiful and new, but now, you know, there's all these cars parked in front of your house.
You know, they might be wealthy celebrities living next door, but if you can't get into your own house, it's like, you know, or it could be, you know, a middle class family that, or families that move in.
Who knows?
I mean, that's not the point.
The point is, you as a resident have now lost part of the reason that maybe you moved to a certain town.
So do you think the residents would, once they figure out this has happened to their neighborhood, they would be upset about it?
And by that time it's too late.
Exactly.
And then who do they come to?
They come to the city leaders.
And they say, why did you let this happen?
What have you done to our beautiful city?
Do you have any other thoughts?
I would just like to really...
Encourage mayors and city leaders to join the California Mayors Coalition because I think the more control that we retain, the better off our cities will be and then the better off our entire state will be.
Well, thank you.
Thank you.
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