Oxnard: Sakioka Farms Business Park to bring 5,000-9,000 jobs; a Sell Job on $45 Million Sales Tax Increase and More to Finance Budget Spending

By George Miller

On June 16, the Oxnard City Council cleared away some of the last obstacles for the new Sakioka Farms Business Park to bring 5,000-9,000 jobs. The Developer promised to break ground on the project this year. The 430 acre site is the last remaining large undeveloped parcel in the city and a big potential boon if done properly and the economy cooperates.

The Capital Improvement Plan discussed at previous meetings was approved, with the warning that it may have to change due to yet unknown budget problems (revenue shortfalls) and opportunities (several new taxes and potential grants).

The coming year’s budget reflects an $8-10 million deficit this year and sharply reduced revenue prospects (-$8.1 mm) next fiscal year (July 1, 2020-June 30, 2021) due to the government-driven COVID-19 lockdown. The city plans to address that with $45 million in new sales taxes (November ballot initiative), a $15 million supplemental property tax to make up the shortfall to pay $64,000 per public safety employee in pension funding (a done deal), borrowing up to $30 million from separate utility enterprise funds, with 10 years to repay it (also a done deal) and a host of cuts, some very painful. So they are bailing out the city’s shortfall with taxpayer/rate payer funds.

Residents continue to complain about 4th of July fireworks– starting heavy weeks in advance. The City is attempting to respond but is under-resourced, planning to use residents’ assistance, strong enforcement, drones. They are already writing $1000 citations.

The (not on the agenda) debate continued on the wisdom of the proposed $34 million downtown homeless navigation center, vs, a lower cost, more remote approach, such as Kingdom Center on Rose Ave., advocated by Homeless Commission Chair Peggy Rivera and some allies. Objections to the proposal center on claimed excessive costs, location, space and hazards. City Manager Nguyen said it will be addressed at the next council meeting.

Meeting AGENDA, VIDEO

Agenda item C-1-  City of Oxnard Overtime Usage Report

The city has been spending $12-13 million annually and rising in overtime costs, about $11.7% of the total 2018 payroll, mostly in public safety. Due to staffing levels, cuts, open positions, vacation, sick leave, skill requirements and call-driven demand, it is difficult to balance labor supply and demand.

The public safety committee reviewed internal auditor Price, Paige findings/recommendations and forwarded it with their own recommendations to council for action.

Briefly, this included some desired changes in internal controls, education on overtime policies, benchmarking with comparable cities, perform hire vs overtime analysis.

Public safety management we have talked to have described the difficulty in not being able to initiate hires until positions are both vacant and funded, which means that they must always play catch-up and have vacancies. Whether that is partially addressed by building it into the staffing plan is unclear. Cuts of recent years have left them short of critical skills and necessitated either more overtime or prioritizing calls so that some won;t be answered or are delayed. This can affect service and safety.

A key auditor recommendation: Eliminate allowing unproductive time such as vacation and sick leave to be considered as time worked when calculating overtime, would require negotiation with the unions.

Others: Adopt compensatory overtime limits in line with the Fair Labor Standards Act (FLSA), Create a position with the responsibility to monitor and evaluate departments overtime usage so that trends in overtime use may be proactively identified and Centralize the City’s payroll system were recommended.

No council action required- just to receive report.

C-2- Five Year Capital Improvement Plan

Examples of projects include:
1. Construction and major alterations of buildings
2. Information technology (IT) hardware
3. Pipeline replacement
4. Playground structure replacement
5. Street rehabilitation
6. Traffic signal hardware installation
7. Wastewater Treatment Plant electrical work

This year, the Public Works City Engineer said, in her report, that 19 projects, costing $27.8 million were completed, with 14 more in bid phase and 32 in design. she also pointed out that there is a lot of deferred maintenance and inadequate funding to do what she thinks needs to be done.

It seems a bit confusing to see general fund projects lumped together with enterprise/utility fund ones, which are supposed to be handled as separate entities.

It certainly is a complex and difficult job to manage/execute so many projects and juggle their financing, prioritization, resources, regulatory aspects, interdepartmental communication et al. 

Unfortunately, the report showed no cost summary, so it would be necessary to research the projects to gather that. It also wasn’t clear which projects on the five year CIP list would be done in the coming year, although she mentioned some project timing orally as she went through the slides. We’ll attempt to contact Public Works and get that info for you. Our impression was that there was no funding for any additional new projects in the coming fiscal year, with existing funding.

Approved 6-0, with MacDonald abstaining. Heavy discussions were covered in previous meetings. This was kind of a pro forma approval.

C-3- Impact Fee Loan Agreement and Resolution for Las Cortes Phase III

This is part of a full redevelopment, consisting of 381 units in four phases, of a public housing project of an old, dilapidated complex. This transaction Involves a $1.9MM impact fee loan by the city to the developer and shift in number of units by development phase. Development is done via a partnership with Urban Housing Communities. Renovation  proceeds on 260 units over 25 acres at 1st and Rose Ave in Colonia. 

They are now demolishing more old abandoned units.

Developer is seeking financing of $15.5 million for the next phase and applying for 9% in tax credits. $71MM total development cost:

Amount Source of Funds
$ 15,440,000 Permanent Loan
$ 44,000,000 Tax Credit Proceeds from Investor (9%)
$ 7,265,000 Oxnard Housing Land Contribution*
$ 2,500,000 Oxnard Housing Authority **
$ 1,916,880 Deferred Impact Fees (86 units)
$ 751,312 Deferred Developer Fee
$71,873,192 Total.

Public Comment

Larry Stein- Inaudible on phone. Sounded like he said it really wasn’t affordable and he had a question no one could hear

Barbara Macri-Ortiz- Supports this item. Financing method and impact fees make sense and should be a model for future projects. New housing should be same affordability level. Some people were prematurely and inappropriately displaced- should provide them  re-entry opportunity.

Council Comments

Perello- Decreasing phase III and increasing phase IV, which is up against a very busy street, cause him to worry about living conditions.

Vote- 7-0, Comm, Andretti voted, Madrigal abstained due to potential conflict.

D- Public Comments on Items not on the Agenda

John Jay- Concerned about fireworks problem in Marina West area

Larry Stein- Question was on affordable housing- not affordable at $400,00. Violating Prop 218- ratepayers should not be paying for what they are not getting services for- this is the case for the GREAT (recycled water) program. 1.5% sales tax increase is unacceptable.

Joyce Chavez- wrong number

Joanne Oliveras- wrong number

Sandy Henderson- Urgent to Oxnard residents to wear face masks in public. Those who don’t are uneducated and choose to ignore the requirements.Claims to have proof thousands of lives saved in NY because of them. Wants Council to consider mandatory wearing of masks in public.

Peggy Rivera- Chair of Homeless Commission, re: Kingdom Center would make a better shelter location, due to size, location and cost advantages. Wants Housing Director to do a feasibility study- this was denied, as was a special meeting on this. Feels that Commission not listened to by the city.Mayor Flynn- willing to work with the commission, but it is an advisory  group.

Irma Lopez- Family here 150 years. As downtown business owner I am very concerned about the proposed downtown navigation center for homeless. Would prefer affordable apts on the site. There are more appropriate sites elsewhere.

Greg Runyon- Re: BLM events locally and nationwide. Needs to be talked about not just making sure our viewpoint is heard. Deal with pain and hurt- help mitigate it. Impressed that many events peaceful, but some have tried to turn it into something they are not. Unload pain and suffering, build, not tear down and burn.

Guadalupe Morillo- Resident, business owner and HS teacher. I favor of homeless shelter. Big donor- $5000.  Opposed to downtown shelter, not out of self-interest. Location near library would discourage use of the area. Not an appropriate site. Likes idea of using the Kingdom Center (Rose Ave). Unhappy that feasibility study denied.

Rick Casteniero- Glad Oxnard is taking a progressive stance and constructing a homeless shelter. Many open questions on proposals. Why is 2nd St. best spot? IS a low barrier shelter to be built? Research says these are only successful 18% of the time. $34 million is too much for this. Why isn’t city building more farmworker housing?

Armando Delgado- Represent local 805 Carpenters Union. Unemployment/underemployment is a big problems, employment opptys. needed. Union labor results in smoother projects, fewer problems.

E- City Manager Report

COVID-19- County revised stay at home order to reopen more businesses under strict social distancing orders. Gyms/fitness, entertainment centers, hotels, campgrounds, restaurants, bars, wineries, skate parks and more.

Pandemic rental assistance program starts 6-17. Call if you need assistance with application- 805-385-7401.

On 7-27 a small business assistance program from the county will start. More info to follow.

Census reporting extended to 10-31-20. Nationally, 64% have responded, County 70%, in Oxnard 62.2% responded.

3,000 masks distributed, 1000 census signs printed, will be displayed, as well as 2 billboards.

Looks forward to (homeless) navigation center discussion at next meeting.

Many BLM demonstrations conducted peacefully. Two city officials participated in a discussion on it on Saturday.

Council Member Lopez- Re: COVID-19. Questions on street sweeping resumption. Nguyen planning it it, will announce at next council meeting.

Flynn- Oxnard sometime accounts for nearly half of new COVID-19 cases. It is now 29% of total county cases- maybe because of extra testing. Flynn wants mandatory mask wearing at businesses. Wants to look at what Ventura did. Everyone in every store he went to was wearing a mask.

Council Comments

Lopez- re: demonstrations/BLM. Work to be done by public safety commission. Want resolution condemning police brutality and making  it a public health emergency.

Perello- Went to Saturday- The Talk meeting. Appreciated. BLM a very big deal. Blanket assumptions of defunding police are wrong. People must be held accountable. We want to recommend that people wear masks. People want to use parks for organized sports. Wants this enforced. Agree with Ventura mask vote.

Ramirez- Congratulate Fire Chief Darwin Base for retirement and excellent service. Glad the city will help with rental assistance and small business assistance concerned what will happen when these programs run out and people are still out of work. Re: face coverings. Dr. Levin has doubts about masks, re supply constraints. Says Ventura medical community begged council to mandate masks. State is monitoring county and may lock us down again if numbers don’t improve. Thinks it is an emergency. 100,000 died in USA, 5000 in state. Want contact tracing. Attended virtual town call , many are institutional problems. Our country was built by slaves. Supports project labor agreement- should be required. Expecting SCOTUS decision on gay/transgender rights (SCOTUS had already rewrote law on this to include them as protected classes). Want decision on “Dreamers” (illegal immigrant brought here as children).

Madrigal- Oxnard has 29% of county COVID-19 cases, but only 200 per (100K) capita vs double in some other cities. Wear face masks. At today’s VC Board Of Supervisors meeting, we are out of the monitoring phase and state will issue new face mask guidelines.

Flynn- wants “conversation” on events of recent weeks (protests). What concrete steps have we taken/planning on disturbing events which seem to be pervasive? Avoid large groups. Fireworks are worst ever already. Inadequate police resources to deal with this. Wants to encourage neighborhood watches to maintain surveillance/precise reporting of illegal fireworks. Many complaints. Affects elderly, children, pets. Major nuisance. Every night. Promises questions will be answered and public informed.

Perello wants to use drones. Especially bad at beaches. Worried also about injuries, fires- health, safety and welfare issue.

G,H,I- Information Consent Agenda

Items pulled for discussion: I-4 by Perello- When info given to public, the other side of the story is needed. Complained about Molina emails. Claims he was consulted on this, but is now going after staff on it.

Vote 7-0 unanimously approved.

J-1- Formation of Sakioka Farms Business Park Community Facilities District No. 8

Special infrastructure/maintenance taxes to be levied on properties. Mello-Roos act applies. 430 acres in NE Oxnard. Will finance construction and maintenance of public improvements including roads, parks, drainage, utilities. Resolution of intent to form was already approved. Tonight is to levy the tax.

Public Speaker

Larry Stein- Opposed to CFD’s (Community Facilities Districts) . There is an issue of the fire station, which should have been built, but was excluded. People are promised things, pay for them, but don’t get them. Vote against CFD.

Email received from Aaron Weidermeier- says there should be an environmental study. Losing prime farmland.

City Officials Comments

Nguyen- Fire station was contemplated many, many years ago. Fire Chief doesn’t think it will be needed if a nearby fire station is staffed higher. Good if there is a willing property owner willing to form a CFD.

Lambert– Re: CEQA (environmenatl study). Not needed for a financial step, but applies to agenda item  J-2. This property is not SOAR protected.

Ramirez- CFD’s are important, so general fund/residents won’t have to foot these bills. Also makes things clearer to future owners. Yes, all of Oxnard is on prime AG land.

Perello- I support it. Caveat Emptor- people need to understand exactly what they are getting into. Re: fire station- a promise was made that it would be put in for Sakiota property- zoned industrial. Current (retiring) Fire Chief says not needed.

Vote- 7-0 unanimously passed this and calling a special election.

Special election for a special tax (requires 2/3 majority of property owners. Only one vote from Sakiota Farms and they agree- passed

Accepted 7-0 unanimously by council.

All four recommendations were approved unanimously.

J-2- Sakioka Farms Business Park Tentative Tract Map, Road Naming, and Development Agreement

An additional improvement on Rice Ave./Gonzales interchange requires CalTrans approval, but project won’t be held up for this.

Four phases of development. Development agreement to be approved. Will include a property owners association. An EIR was done in 2012. We are told that no subsequent EIR CEQA study is needed.

If this site is developed as light industrial, it will not require a new fire station.

CFD will continue for 50 years after the expiration of the development agreement. Many other requirements and terms which you can read about in the agenda materials.

Lambert said that:

Lambert says that Development estimates this project can produce 5000-9000 jobs.

Public Speakers

Larry Stein- 1700 people live in the area. Need life support. There is insufficient water due to litigation and water credits. We were promised a fire station. Lack of trust.

Nancy Lindholm- President Oxnard Chamber of Commence- supports/supported project for nearly 2 decades. Crucial for business development and revenue.

Craig Kohara- (one of Sakioka owners)- Thanks to city staff, especially Director Lambert and City Manager Nguyen. Please approve it.

Scott Hules (project Civil Engineer)- Herculean effort- thanks to all. Xerox purchased in 1969, sold to Sakioka’s in 1974. Started in 2003, approved 2012. Plan to break ground this year. $60MM in development fees. 5000-9000 jobs and relocation of existing Oxnard facilities.  Major Rice Ave. improvements, landscaping, sidewalks, project gateways. Expanding a fire station actually provides more flexibility than a new one.

City Official Comments

Ramirez- Thanks for all this work. What about public transportation, getting people off the road. Lambert- original plan had transportation demand management program. Gold Coast Transit involved to adjust routes. Not much in city history records of Sakioka family.

Perello- Have spoken to Kohara. I support this. I want fire chief to address comments from a member of the public that were totally out of line (referring to Stein). Wanted an all solar project. What are palm trees doing to improve the city? We need more beneficial trees. We will be moving soil- why? Why is project not in SOAR? Any attempt to include local labor?

Lambert- provision was to offer that prime soil to other ag properties. Good question about palm trees. We will use palms as gateways, not main trees. Likely there will be a lot of solar- no mandate.

Fire Chief Base-  Fire Station 8 took some of the FD workload off. Development plan and other factors mean another station is not needed. Perello-  wants an apology from Larry Stein for his comments.

Nguyen- Doing development agreement, will make sure carpenters union meets with developer.

Basua- Get in touch with local trades group.

Flynn- met with Kohara. Previously discussed  a second Amazon HQ. He says it was to showcase the property to other prospective developers.

Gravity, synergy and biology are some new street names.

J-3- Fiscal Year 2020-21 Operating Budget

This is for almost everything except the enterprise funds.  AMOUNTS

City Manager Nguyen said they are trying to reach “fiscal sustainability.” He projects an $8.4 revenue shortfall this years and $8.1 MM next year, due to the COVID-19 lockdown, which hit hard and fast and halted progress. He said they had predicted only a $2MM deficit before COVID-19 struck. The city has been in a financial hole for many years.

We are still in the midst of a pandemic, don’t have a vaccine “yet.” Economy and market are unknown, Don’t know if there will be a second wave of the pandemic.

He is looking at major tax increases to solve the problem.  Tonight’s feature was a 1 1 /2% sales tax increase, to generate an additional $45 million revenue.

Taxes make up 77% of revenue.  He stressed how little of the property tax (17.6%) and sales tax (1.5%) actually goes directly into the city’s coffers. Previously approved a $15 mm supplemental property tax and authorized borrowing $30 million from utility enterprise funds.

There are also special taxes, bond proceeds and special assessments.

The general fund reserve will be wiped out with existing spending and no new revenue, especially with anticipated reductions in revenue due to the lockdown and resulting unprecedented implosion of the economy,

Many cuts have already been made in library, landscaping.trees, parks, community services, museum, golf course, PACC, etc. Streets have much deferred maintenance ($11.5 MM vs $13MM needed). Some positions eliminated in police budget, but compensation/pensions have gone through the roof.

He claims that there is much additional financial transparency, since March. Standard and Poors upgraded its Oxnard rating to positive even with previous deficits.

Raised development fees and many other fees. Billboards, Cannabis and the PUC credits sales (one time) should bring in a couple of million.

There hasn’t been all that much budget discussion at the council meetings this year.

19 capital projects worth $27mm were done.

Crime is down for the last 4 years (after jumping 64$%before that). Homelessness- reduced unsheltered portion of homeless population by 76 people. (355 homeless throughout VC are now shelter in county-leased hotels- many were in Oxnard). Continue to receive grants, including $8.5mm for long-neglected Campus Park. Up to $25mm will be provided by Gen-On for dismantling Ormond Beach power plant after it shuts down.

Fiber optics master plan should benefit city and private industry. New golf course contract eliminates operating subsidies. Same for PACC. May try some outdoor drive in events. Museum closed. ERP system being replaced, but it will be expensive- needed.

He said that permitting is being streamlined.

Hotel tax down 80% in recent months- 30% for the year.

Had to freeze wages, cut some new hires, cut part timers.

Trying to prevent further cuts/furloughs and associated programs. Counting heavily on a vaccine.

He expects reserves to drop to $3.4MM if nothing changes. May have to make “nasty” decisions.

If we don’t rightsize our revenue (bureaucratese for increase taxes), nothing changes.

More economic  development needed. Claims condition of city inhibits economic development.

Double digit forecast cuts are economic ruin. Claims he’s already cut the fat, flesh, bone. Unsustainable.

Public Comments

Jacob Wattis- Excessive amount allocated to Oxnard Police Dept.- $62MM- 44% of city’s (general fund) budget and too low for community services. Other community services are too low. Want 10% $6mm cut to police budget.

Douglas Portello- Concerned about police budget- 45%. Police are militarized. Presence of a badge and a gun escalates situation.

Larry Stein- No sales tax increase.

Michael Mecurio- Active with neighborhoods and public works. New City Mgr set us on the right track- cuts to bone, marrow. Wants tax increases to keep city moving.

Ray Blutel- City Manager has too much staff. Largest budget in years. City Attorney Dept too large. Police Dept cuts back community patrols without a commensurate budget cut.

Andreus Garcia- Challenge us to reimagine public safety, use San Francisco as an example (yes, he really said that) . Likes the sales tax increase.

Council comments

Madrigal- Looked at comparative budgets, COVID was a setback. Fear that many companies could fold. Hopes for a vaccine. Per capita $306/per person. Ventura is $355/per person to police, larger than Oxnard. Lancaster uses sheriff, still at 44%. Crime is down by 2/3. Rose Park, with a great neighborhood watch, is the lowest crime in his district. Community policing works there. He needs a promise that community policing is coming back. Crime dropped since the high point of 1992 (it dropped so nationwide). Cuts will affect the poorest the most. Doesn’t smarter about race or other arguments used to divide people. He notes that Camarillo’s policing budget seems lower and wonders if it is the entire amount. Santa  Clarita was $28mm just operations and maintenance. Nguyen says it depends on what is included- buildings, maintenance, services, etc.

Basua- Tough decisions last year, COVID did not help. Gets lots of complaints about parks, services, homelessness. Reserves perilously low. COVID and existing problems are the perfect storm. Don’t know what tax revenues will be coming in.

Ramirez- Listen again.   Budget is a plan, a road map. COVID-wise. a big problem. She has a problem about how cities are funded.We have to have a conversation about how policing is done, Want more money for cultural services, Schools are school districts, public health is done by the county. Pass budget, we can change it later. We need people to respond to what people need. I like the look of our police dept. We have not had problems that other cities have had. We need to have a discussion about the insecurities that people have that cause them to commit crimes.

MacDonald- also did a per capita public safety analysis. Oxnard is in the bottom third. Some police calls should be done by someone else. Homelessness is an example. Losing 11 sworn officer positions in this budget. Staffing level is plummeting. He gets complaints that police take a long time to respond. Tonight he’s hearing fireworks and gunshots. Maybe some stuff should go to mental health professionals, but may be dangerous. Minneapolis is not “all cops.” Must be a relationship between the community and the police. Police have a good relationship with community. Neighborhood policing is a good solution, but budget will not allow it. Can’t support this.

Perello- Slide 6 addresses general fund reserves, expenses and revenues. Property taxes won’t even cover the police dept expense. Sales taxes are only half of it. Crime is down. Slide 31- police Dept- eliminating 11 sworn positions and 6 non-sworn positions. These positions are vacant, were vacant last year, but were funded, so what was the money used for? Crime is still down. This City Mgr who has helped dig us out of the hole- and he is no saint (laughter in Council Chamber). Some of these jobs can (currently) ONLY be done by the police. I don’t know what else can be taken out of the budget. Felt that some of the comments at the Saturday “We Can’t Breathe Conversation” were low blows, such as when has a police officer ever been fired? 18 were fired or resigned under pressure in recent years.

Lopez- Couldn’t imagine what would have happened if we hadn’t made the (budget) decisions of last year. At the Saturday event, police dept budget was mentioned., Whitney says police must take on some tasks nobody else will. Still have a homeless issue. Look forward to mid year budget evaluation in January.

Madrigal- One district removed SRO’s (police). What if other three distracts remove them, too? Whitney- we do not anticipate losing that. Districts pay 75% of cost- about $500,000.

Nguyen- Already compared other city’s police costs. The City Mgr $1.3MM project cited is to improve communications tools in the (1960’s) council chamber. Chief Whitney will address Perello police questions. Always open to “reimagine” policing……

Whitney- Public safety is the foundation of the city. Ventura spends more per capita- has more, City is desperately underfunded in recreation. General fund does not compete with schools, utilities. Yes, need more mental health services, housing. The reality is that mental health professional will not go on high risk calls without police accompanyment. Have made cuts, restored. These cuts will take us back to where we were in 201. Must pay people the going rate to hold on to them. Cost of living is high in Ventura County. Have 29 vacancies now- 31 by end of fiscal year. Went up higher due to COVID-19 academy cancellations.

MacDonald- Can’t fill a position until it is vacant. That tends to mean more vacancies.

Perello- Chief, are the vacant positions budgeted? Whitney- yes. Perello-where does that money go? Is it a slush fund? Whitney- vacancy rate is built in. It is called “vacancy savings.” But overtime may absorb it.

Nguyen- Perello asked me to review sales tax.  Almost all goes to the state. We get 1% + our own 1/2% Measure O addition.

Flynn- Budget prepared under very difficult circumstances. Finance Committee is him, Lopez and Perello. They wanted a Conservative approach. Borrowing to finance the budget. Wants budgeting in the hands of the council. Wants priority-based budgeting, Now relying upon management to do it. Had less poverty, more recreation when he grew up. Not taking in enough revenue. 60% of budget goes to public safety. Sales and property taxes barely cover it. Safe community is a major priority. 3/4 of fire dept calls are non-fire related- medical, car accidents. Fire dept receives dis proportionally less than police.  They respond very rapidly. Relying on the police dept to be social workers, resolve domestic disputes and homeless. We are spending right amount on police dept and too little on Fire Dept.  There is so little left for discretionary spending. Want priority based budgeting. Why do we lack revenue.? 2/3 comes from property and sales taxes. We house 3/4 of all the farm workers in Ventura County. Those homes have frozen property taxes. We should have $80-90 million in property taxes. Sales taxes could be higher, but residents have low disposable income. We need to get concessions from bargaining units or may have to cut positions if revenue goes down, Do NOT want to do this. Might have to close library or recreation.

Vote- This is not a final vote, just receiving the budget proposal and providing input. Final vote schedule for June 30.

Voted 6-1, with MacDonald dissenting.

George Miller is Publisher/Co-Founder of CitizensJournal.us and a “retired” operations management consultant residing in Oxnard.

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