Category: City Finances

  • A Tale of Two Parklets

    I talked about how I believe parklets (taking over some parking spaces, but leaving the roadway open) are a better solution for saving restaurants than the wholesale street closures here.  Now that some restaurants outside of the Burlingame Avenue Autonomous Zone (BAAZ) are jumping on the parklet idea, we can start to compare approaches.  Chatting about it with a few locals, the idea seems to be popular since it is seven days a week and can be done nicely.  Our Michelin-starred Rasa seems to have done the best local design so far.

    Rasa parklet1

    But check out the effort by Moody's in Truckee!  All of the restaurants along Commercial Row are using the raised platform approach, but Moody's has upped the game with amazing lighting, curtains, heaters and loudspeakers.

    Moody's parklet1

    Using the ugly orange hydro-barriers on all three sides instead of just the on-coming traffic side seems like a B'game-only approach–San Mateo doesn't require it.  B'game restaurants will hopefully make continuous improvements since these will likely be with us at least til the rains start.

  • Tweaking The BAAZ, Creating The BRAZ

    Tomorrow night the City Council will consider making some changes to the Burlingame Ave Autonomous Zone (the BAAZ).  We're just finishing the third weekend of the BAAZ so Council will be looking to extend it to the end of September and add parklets on the side streets.  Back in May when the original plan surfaced, I had several concerns: impact on non-restaurant businesses, non-BAAZ restaurants, parking, handicap access and the cost.  It appears I was prescient since the proposed tweaks start to address some of these, especially the fairness issue. Non-BAAZ restaurants that want a parklet on Primrose, Park, Lorton, Howard, and Chapin would get permanent ones (meaning seven days a week) since they are too expensive to put in and take out often.  The parklets would be created using heavy duty industrial plastic hydro-barriers — the ugly orange blocks.  San Mateo went the parklet route but only uses the hydro-barriers on the on-coming traffic side as shown below (upper right).  I hope we do the same.

    To further address fairness to our "other" downtown, the one that often feels under appreciated by the City, the BRAZ is under consideration — the BRoadway Autonomous Zone.  It involves Saturday-Sunday closure of Broadway between Chula Vista and Capuchino — the three middle blocks; attempting to leave some traffic circulation since, you know, it's a 101 exit.  Anecdotally, the Broadway restaurants took a bit of a beating the last two weekends–akin to the non-BAAZ restaurants.  One non-BAAZer used the word "disaster" when I asked how it went the first weekend.

    As to parking, the Staff Report notes

    In addition to the previously estimated loss of parking on Burlingame Avenue of approximately 150 to 160 parking spaces when the street is closed on the weekends, the creation of parklets will result in a parking loss of up to approximately 60 to 70 spaces on side streets in the downtown area on both weekdays and weekends.

    Approximately 50 to 60 parking spaces would become unavailable on weekends if the City Council approves the temporary weekend closure of Broadway. As with the Burlingame Avenue commercial district, there are nearby parking facilities on either side of Broadway, but parking will become tight on busy weekends.

    I might suggest putting a cover over most of the EV charging stations in Lot Y so GV's (gas vehicles) can use them because we know EV usage has been quite low. 

    Now the costs:

    Staff estimates the cost of setting up and removing the street closure on Broadway to be similar to Burlingame Avenue, which is estimated at approximately $10,000 to $12,000 per month. Additionally, staff estimates the cost of renting and setting up barriers to create parklets is $20,000 to $30,000 per month. Regarding loss of parking revenue, staff estimates the overall loss is approximately $20,000 to $30,000 per month. The overall total fiscal impact of the pilot program is estimated to range from $60,000 to $80,000 per month. The actual figure may vary and will be determined after the completion of the pilot program.

    We may have our very own Summer of Love.  Like the original one in '67, it would be fun but comes with a price.

    SM Parlklet hydro

  • Staking Out a Position on Police

    The issue of police procedures and use of force got exactly zero discussion in the last City Council election.  The next election is about a year and a half away, but it's never too soon to take note of a candidate's or incumbent's public position on important issues.  The losing candidate in the last election, Mike Dunham, did fairly well last year garnering almost 2,700 votes (25.5%) so what he thinks matters.  In a letter to the Daily Journal this week, Mr. Dunham objects to police "displaying riot guns and batons" at one of the demonstrations while simultaneously noting that "witnesses spotted gun-toting individuals who were not part of the protest".

    Dunham ltte

    I'd like to meet an officer who is willing to provide on-the-ground support at a demonstration of highly-incensed people without a baton and at least a few fellow officers carrying (not "displaying", sorry) something more accurate at distance than a sidearm.  That is a job description of a position that will be open for a long, long time.  Dunham ends by broaching the subject of police funding.  Elsewhere in the DJ another B'game resident, Arne Hurty, starts the discussion of "defunding" our police and bringing on people trained to deal with mental illness, sex workers and even traffic violations.  He doesn't mean in a clinic or center after the fact–he means on the street in real time; as the stuff is hitting the fan.  I'd like to meet one of those pro's and review their credentials.  I'll let Willie Brown's comments in today's Chronicle respond:

    The call to “defund the police” as part of the anti-racism, anti-police-brutality movement is either one of the dumbest ideas of all time or the hands-down winner of the worst slogan ever.  I shouldn’t have to explain that actually defunding police is a nonstarter as a practical matter, let alone as a political one.

    I'm all for more mental health counselors, but it has to come from net-new funds and there are going to be precious few of those for the next couple of years.  And they have to be backed up by a judicial system that functions better than the one we have now; as seen in the comments on the Social Media and City Government post.  Now there is a problem I'd like to hear elected and future candidates weigh in on.

     

  • Prop. 13 – Who’s Getting the Shaft?

    News reports indicate that the "split roll" initiative to split commercial Prop. 13 tax policy from residential policy has submitted enough signatures to be on the November ballot.  I guess we should be thankful that California law about new taxes says it has to go to a vote of…the people instead of just the politicians.   The whole Proposition proposition is a mess, but that is a discussion for another day.  This day we have to assess whether reevaluating the market value of commercial property on a frequent interval and taxing it accordingly is a good thing or not.

    I touched on this after hearing our assumed new state senator, Josh Becker, throw his weight behind the idea here.  But is there more to the story?  And does the hidden story involve the Law of Unintended Consequences?  Care to guess?  Well, the Law of Unintended Consequences is a bit like the Law of Gravity.  The SacBee, no enemy of new taxes, just reported this interesting consequence:

    County tax collectors are reiterating their opposition to a proposed “split roll” initiative that could raise tax revenue from commercial and industrial property, calling the measure “problematic” and difficult it to implement.  The California Assessor’s Association in a letter to lawmakers says tax collectors don’t have the resources to execute the plan, which calls on them to more frequently assess commercial properties worth $3 million or more.

    “In my opinion, the property tax measure as written will be impossible for assessors to implement — not just difficult but impossible,” Santa Clara County Assessor Larry Stone said.

    Assessors project the changes would cost just over $1 billion to put in place over three years, and would “overwhelm” county assessors’ capabilities.  For example, according to an attached analysis commissioned by the Association, Santa Clara County would experience a 12-fold increase in the number of commercial and industrial properties it reassesses annually.   “It is expected that similar increases would result in all counties,” the analysis states.

    While we might have sympathy for all the tax collectors having to massively grow their empires to implement the law, what about the people paying these new taxes?  Most people who have never rented a commercial space or run a small business don't know how that world works.  That apparently includes our next state senator.  The term to learn is a "triple net lease".  I'll let Wikipedia explain it here.  If you don't know what it is, you have no business voting for this initiative.  Suffice it to say the very same shop owners and restaurants that I have been fretting about (more than usual) for the last two months are the ones who would get shafted by this ballot initiative.

    You are going to hear a lot about the budget shortfall, the evil commercial landlords who have been skating by for years, the school budget cuts and whatever else gets thrown against the wall in hopes it sticks.  Now is the time to understand who will actually be hurt by the latest tax grab.   Full disclosure:  I do not now, nor have I ever owned commercial property.  That doesn't mean I don't recognize a train wreck in the making.

  • More Parking: Perhaps You Missed It?

    When you walk or bike around town you get a good, current view of things that are happening–or not happening.  I shouldn't be surprised when people spout off on one of the other local social media sites about what the city should or shouldn't do–only to be told that they are already doing it because it has been in the works for years!  The absolute biggest case in point is the huge parking structure being built between Lorton Ave and Highland Ave. just south of Howard Ave.  I get it, they're sheltering-in-place, but really?  Before you put fingers to keyboard maybe you should get your mask and walk around downtown for the first time in six or eight months.

    When someone tells you we should shut down Burlingame Ave. for the restaurant trade to survive, that is debatable position.  We'll get to that another time.  But when some know-nothing says we can't do that because there isn't enough parking downtown and the city should build more someday, well, ta da.  Do try to get out more.

    IMG_9860

  • Tracking the Curve in Context

    I've been looking for ways to illustrate the infection case rate in the County since that is most pertinent to us here in B'game (verses the state, the country, New York City or whatever). Try this local comparison on for size.

    The County has 766,573 residents.  PacBell-AT&T- now Oracle Park, home of the SF Giants, holds 40,800 people. So if the Giants sold-out 18 games and the 19th game sold three quarters of the seats that would be everyone in the County going to one game. According to Wikipedia, there are "1,500 club seats at the field level behind home plate". If we get around a dozen new cases per day over the next month that the Shelter-in-Place is in effect, the total cases would just fill the Field Club section at Oracle once. That's not once per game–just once. Just some perspective on today's total case count of 1,177.

    It also reminds me how much I miss Major League baseball and the local BYBA and BHS games.  As the County relaxes some of the outdoor restrictions we need to keep up the SIP discipline, but it may not be obvious how to balance reopening with the impending economic hardships.

    IMG_9862
       

  • Municipal Charity is Limited

    The City-funded support for local businesses, residents and charities is coming into focus as the DJ reports today

    The Burlingame City Council agreed to build a $500,000 grant program for local businesses, while setting aside $250,000 to purchase gift cards for struggling families and donating another $250,000 to service providers.  The program is to be administered by the San Mateo County Economic Development Association, or SAMCEDA, which is also operating a similar program through the county.

    Noting the city’s contribution capacity is limited, Councilman Michael Brownrigg said the Burlingame Back in Business program would likely serve about 50 companies fitting a limited criteria with grants capped at about $10,000.

    Officials also agreed to purchase about 1,000 gift cards from Visa or Mastercard worth $250 which would be distributed to families in Burlingame, with hopes the cards would be redeemed at local businesses.  Councilmembers had first discussed attempting to restrict spending to a specific zip code, but ultimately determined allowing flexibility for families who need assistance would be more valuable.  Those eligible for the program will be contacted by the city’s utility provider, which maintains a list of those who qualify for financial aid.

    We are in the fourth quarter of the city's fiscal year which ends on June 30th.  Using last year's financial report as a rosy baseline,  page 34 shows the $84.5M of revenue had major components of property taxes (25.7%), sales and use taxes (21.1%) and the biggie that is also the most at risk, hotel tax (34.8%).  When Michael Brownrigg says that the city's contribution capacity is "limited", he ain't kidding.  We could easily see the hotel tax get cut in half for the year–which would be a $15M hit to the budget.

    Even at the end of June when the next report arrives, we won't really see the complete picture since the pain arrived at the end of the third quarter.  Another DJ piece on the San Mateo budget shortfall lays out the timing issue

    “There’s a challenge we have on sales tax in that the data we get is essentially six months in arrears. The most recent sales tax data we have is for the third quarter of 2019,” said Finance Director Richard Lee. “We won’t see the true impact of COVID-19 for another six months. … It’s a similar concept for [hotel] tax.”

    San Mateo's predicting a $7M "structural imbalance" next year which seems small to me.  It's total projected budget is $251M but only 14.3% in sales and hotel tax, so we shall see.

  • Friends with Benefits: Calpers Hedged or….Not?

    Four months ago, we looked at the new Calpers chief investment officer Ben Meng's early moves to shore up the municipal and state workers' pension fund here.  We watch this because the City sends a sizeable chunk of pension money to Calpers to invest on its behalf.  We already know the coming year or two is going to be ugly for city finances.  The hotel tax ("TOT") has evaporated and it's certain the various sources of sales tax are going to be down substantially.  So sending cash off to Calpers in Sacramento has to be funded from somewhere and how Calpers manages it is important to all of us.  A piece in today's Wall Street Journal highlights Meng's call to exit several "tail risk" funds–meaning they hedge against rare events (the "long tail" in a probability distribution).

    The California Public Employees’ Retirement System was well prepared to cash in on a stock market selloff. Until a few months ago.  After suffering big losses during the financial crisis, the $371 billion pension fund hedged against another dramatic downturn by investing in three funds designed to produce big payoffs when markets fall steeply. But the pension, also known as Calpers, decided to sell out of these hedges last year, giving up what could have been a payday of more than $1 billion.

    Some members of the Calpers board were caught by surprise.  “He took away a risk strategy that the board had approved without telling the board,” Ms. Brown said in an interview.  Calpers began investing in both funds in August 2017 and developed a third internally managed fund with a similar strategy.  Calpers decided to unwind the positions in October, and by March it only had a residual stake left in one fund– LongTail Alpha LLC , according to documents and people familiar with the changes.

    Mr. Meng, who took over as the pension’s chief investment officer in January 2019, said he has no regrets about exiting Universa and the other funds. “Knowing what we know, we would make the exact same decision,” he said in an interview.

    We shall see how the board and Meng address this.  Meng may have put in a viable substitute strategy–it's a story that is just starting, but one that highlights how expensive this lockdown will be for everyone regardless of whether they are working now or not and regardless of whether they are stock market investors or not.  Personally, I'm glad I live in a fairly well-run (financially speaking) city and that over the years we have chosen to limit our interdependence on other cities.

  • Covid-19 Tracking and Planning

    It's time to start a new thread on our tracking of the coronavirus.  You can see the prior post from March 24th and the path of the virus' growth in the County here.  Today's County report at SMChealth.org shows 16 new cases in the County for a total of 767.  67 cases are currently in hospital and 7,295 total tests have been done with a 10% positive ratio.  Recall there are about 769,000 people in the County so the testing rate is still minuscule.

    There was a great human interest story in the Daily Journal yesterday about Officer Steve Vega.  I've chatted with the officer on the street before (the last time was in front of the Apple store during the on-going patrol there) and I'm thrilled to hear he is better.  He may be down at Stanford right now donating

    After recovering from COVID-19, Burlingame police Officer Steve Vega is hoping the antibodies in his blood can be used to treat others infected with the disease.  Vega, 55, is among the first participants in a new effort by Stanford Blood Center to treat COVID-19 patients while the world waits for a vaccine to be developed.

    The 22-year Burlingame officer is set to donate his plasma, the liquid in blood, at Stanford this Thursday and however many times is needed after that.

    Also in the news is some data on how the work-at-home trend for self-isolating plays out across the economy.  Having worked full-time from home for more than a decade one article about the trials the newbies are discovering was gratifying to read.  On the data side, the Wall Street Journal has a piece titled "The Lucky Stay-at-home 37%"

    A newly released study called “How Many Jobs Can Be Done at Home?” reckons that 37% of all U.S. jobs can plausibly be done at home, meaning that nearly two-thirds cannot. The study’s authors, from the University of Chicago’s Becker-Friedman Institute, add that their 37% estimate is at the “upper bound of what might be feasible.”  Along with other studies, this one also finds that those in jobs that can be done from home “typically earn more.” By their calculations, for example, 37% of jobs that can be done at home account for 46% of all wages.

    Those who have stressed the need to get our economy up and running again are sometimes criticized for favoring profits over people. But the Becker-Friedman paper underscores that those lower down on the socio-economic scale are most in need of a re-opening for their livelihoods.

    That's an important point that can be missed during the high-anxiety zeitgeist we are in.  Here is the Avenew showing that zeitgeist.

    Pandemic Avenew at dinnertime
     

  • Electric Parking: Low Usage at Lot Y Spaces

    Some of the comments on the original post about taking 10 regular parking spaces in Lot Y just south of B'way and creating 8 electric vehicle-only charging spaces noted low occupancy (often no occupancy) of these new spaces.  I've noticed the occasional EV getting juice there, but not too often–and only once have I seen three EVs at the same time.  That motivated me to get the early usage figures from the City and the vendor, EVgo, so we can establish some sort of baseline.  I fully understand that some innovations take time to get to widespread use–the question is how long, if ever?  So here are the January 2020 figures (i.e. 31 days):

    312 Charging Sessions

    5.2 Megawatt Hours of charging delivered

    Equates to ~1,350 miles of electric driving

    Doing the math:  10 charges per day for 8 spaces is our baseline…1.25 charges per space per day.  Again, these things can take time, but I sure hope things improve otherwise we should turn at least a couple spots into EV-optional access until usage ramps up.

    EVgo threesome

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