60 years of broken promises left California City in chaos
Enough is enough! Fix California City. For the fourth time in six years, a Kern County grand jury has issued a scathing report detailing the mismanagement and chaos in the eastern Kern desert city.
Describing California City as a “city in trouble, a city in ongoing crises,” the report details lawsuits, uncollected taxes, revolving-door mismanagement, lack of fiscal controls and state law violations. Some of the report’s findings:
City budgets approved in that past three years have been six to eight months late, leaving the city at times operating on a month-to-month basis. Budgets are not regularly checked to identify shortfalls.
The latest approved $31.1 million budget is built on a foundation of hope, rather than certainty. The plan to stave off insolvency predicts a 16% increase in revenues from bumps in off-highway vehicle grants and capital project funding, as well as more returns from intergovernmental revenues, gas taxes and water fees.
On paper, the new budget looks balanced, but to work, it must overcome the annual loss of $1.1 million from the closure of a private prison, and expected annual loss of $6.1 million from the sunsetting of a tax to fund the police and fire departments.
With the expectation of collecting $10 million a year in taxes, California City in 2016 became the first city in Kern County to allow commercial cannabis cultivation. But the city has not collected about $507,000 in license fees, permits and excise tax. A staff shortage, lack of fiscal controls and litigation are blamed for the shortfall and skyrocketing legal expenses.
Although state law requires California City to regularly approve and post City Council meeting minutes, it doesn’t. As a result, it’s difficult to track council action.
The city is plagued by a revolving door in the city manager’s office. The present occupant, Patrick Marsh, is the sixth person to assume the role in the past year. He replaced Michele Martinez, who resigned after only 10 weeks out of fear for her safety.
California City’s management problems and chaos are so bad that two statewide risk-sharing agencies terminated its membership.
The grand jury’s recommendations boil down to two words: Fix it! But how?
“A city built on decades of broken promises cannot be transformed overnight, but with the right direction, policies and processes in place, California City can achieve all its dreams,” said Mayor Kelly Kulikoff.
Envisioned by land developer Nat Mendelsohn after World War II to provide affordable housing and economic opportunities to returning veterans, California City was officially born in 1958. Mendelsohn sold his dream with slick brochures promising golf courses, an airport and a population of 400,000. Photos of sailboats skimming across an artificial lake were highlights.
The town was incorporated as a city in 1965, theoretically to give it local control. But Shannon Starkey, a University of San Diego professor and California City researcher, told the San Francisco Chronicle last year that Mendelsohn had a strategic reason for pushing incorporation.
With his real estate company $7.5 million in the hole, it was a way for him to foist onto the newly formed city the fiscal responsibility for its maintenance, she said.
The dreams for California City’s growth and prosperity never materialized. But that did not stop Mendelsohn’s and subsequent companies from selling plots to gullible investors.
From Mendelsohn’s purchase of about 82,000 acres of desert land, California City remains geographically the third largest city in the state. But only about 15,000 souls call it home. One-third live below the federal poverty line. Aerial photos show an extensive pattern of mostly deserted roads and vacant lots, which has resulted in lawsuits, regulatory fines and criminal fraud complaints.
California City can’t heal itself. The grand jury did a good job of identifying today’s problems. But oversight is needed.
California City could file for bankruptcy or disincorporate. But that does not mean Kern County would assume the city’s debt. Likely a special district would be formed to finance services.
The city appears to be violating state laws mandating fiscal responsibility and transparency. The state attorney general can investigate, demand reforms and appoint a compliance monitor.
The city’s two state representatives — 12th District Sen. Shannon Grove, R-Bakersfield, and 34th District Assemblyman Tom Lackey, R-Palmdale — can request a legislative audit to investigate problems and recommend solutions.
California City’s growing problems have been ignored for too long.