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Leucadia Economics

A commenter seemed to think all Leucadians have taken on unsustainable and unstrategic debt. I don't know if there is good data on local consumer debt, but you'd think that local businesses and governments would want to know how tapped out the people are before making revenue projections. Is that data available?

A lot of Americans took on debt for boob jobs, boats, and trips to bermuda. The NYTimes did an interesting series on why so many jumped into the "debt trap". It is unfair to imply that this behavior was conducted by all Americans. Many were responsible and more thoughtful about taking risks. Many even realized the generational penalty we would pay for all the play.

Here is a little write up on the impact of interest rates and housing prices. Rates will have to rise (lets hope) and that will cause a deflationary pressure on housing prices. Maybe the government should prop housing prices with the Mick Pattinson solution of increasing permit fees and legal hurdles for development. We all know that the cost of production is what sets the price of a home. The papers printed that anyways.

Here is an example house that is for sale on Crocus:

Below are the zillow market price estimates. 

click to enlarge

You can see that the Zillow estimate for this house and for 92024 demonstrates a substantial drop in real estate prices, since the peak. The Fed can't lower interest rates enough to shove prices back up, especially in this economy. No more housing credit ATM machines. Good thing  a lot of us didn't over leverage.

Low Income Housing

From the inbox:

How things work in Leucaida

1. Low income family lives in an old house on greenhouse property.

2. Developer subdivides property and asks for a density bonus, that is only available to those doing large developments and is granted regardless of proximity to mass transit or a local coffee shop.

3. Developer gets density bonus for providing a place for low income people to live. Yes, it can be the same house that was already occupied by low income families and, yes, you can end up with less free market low income housing in the end.

4. Developer builds out the development and the old house is bulldozed. Zero low income housing.

John

Bloggers note: Below shows where there was once a home housing a lower income family and now awaiting  (years) to become a density bonus low income house.

Houlihan waved her hands at the Density Bonus stuff a few years ago. Other than that, there has been no real effort to fix this homespun density bonus law. What can be done? 
1. Make it a council goal to adopt a density bonus ordinance that closes grand canyon loopholes and makes sure it is consistent with other city goals, 
2. work with our state reps to change the state law. The council (disingenuously?) complains about density bonus but does not follow through on changing the law.

Pacific View Cultural Center?

Fellow Arts Supporter,

Please join us at the next EUSD Board of Trustees  meeting
Tuesday December 7, 2010, 6:30pm
101 S. Rancho Santa Fe Road, Encinitas

The Downtown Encinitas Mainstreet Association has let the school board and its superintendent know that we are very interested in leasing the Pacific View School site for a cultural arts center.  We intend to have 3-5 key speakers address the board at this meeting.  You will not need to speak, but the most  potent a message is a room packed with as many  supporters as possible so that they realize just how enormous the community sentiment  for this venture really is.  You can also send each of the board a quick message of support.

Please keep in mind that any future use or project on the Pacific View site should have four guiding principles:
·             Education including art and nutrition, and our children’s access to the site.

·             Historic Preservation and adaptive reuse of the existing buildings.

·          That it remain in a public use

·          That it provide revenue to the EUSD and/or Encinitas Education Foundation for the benefit of our schools

       The final decision is up the EUSD board of trustees.  I urge you to write to them.
Bill Parker                       bill.parker@eusd.net
Carol Skiljan                    carol.skiljan@eusd.net
Catherine Regan             cathy.regan@eusd.net
Emily R. Andrade            emily.andrade@eusd.net
Gregg Sonken              greggsonken@gmail.com
Marla Strich                    marla.strich@eusd.net
Maureen Muir               maureen.muir@eusd.net

Hope to see you at the meeting and eventually at the “Pacific View Cultural Arts Center”!
Please forward this to as many interested people as possible.


Dody Crawford
Executive Director

The Yurt don't Hurt

Saw this petition on my Facebook wall feed:

Save the Yurt @ Yoga Swami's @ 912 S. Coast Hwy 101

I've never actually been there. Is it cool? It sounds cool.

RTV Estates Update

Here is some happy news from the Planning Commission meeting last night.

The Planning Commission meeting concerning the topic of the ol' Barratt development took a bit over 2 hours to discuss tonight.  The PC was concerned that the affordable unit allotted on Sheridan was not part of the build out by ELN...and they had some concerns about the 2 units proposed for Andrew - plus other problems in the proposal.

Remarkably they seemed to have read the emails sent by us. (I know it's hard to believe. I was impressed that the commission had done their homework - and told them so.)

In the end they voted NOT to approve the application of ELN.

You can be proud of the excellent speakers tonight -- each highlighting different elements of this very complicated situation.

Thanks to all who participated and supported this effort to make things right in the hood.

Ron

Hermes Commotion

This just in:

Major commotion with a dozen plus law enforcement officers rolling on Hermes Ave, one block off Leucadia Blvd. Who was on the scene first to cover the story?  encinitas.patch.com. Watch for their report to appear here.

Rancho Tyvek Estates

From the In Box:

There are two important quality of life issues for Leucadia that need citizen attention right away.

# 1 - More about the famous Barratt-American business at the corner of Sheridan and Andrew:  There is an agenda item before the Encinitas Planning Commission this Thursday Dec. 2 at 6 PM that needs our attention.  Brief summary of case # 10-150 RA  (the full and very involved agenda item is at: http://archive.ci.encinitas.ca.us/WebLink8/DocView.aspx?id=671211&dbid=0)

A company called ELN, LLC has purchased the remaining home in escrow on the western Nantucket property. It can't be sold until the affordable home is built on Lot 8 along Andrew Avenue. They propose to increase the square footage of what is required to 2000 sf and add a 600 sf additional unit for affordable income families. Two units would be on the same lot. That would free up the existing home in escrow to be sold.

ELN also is proposing to the city that ELN be allowed to build out all of the eastern part of Nantucket WITHOUT HAVING TO BUILD THE AFFORDABLE UNIT designated for Lot 4 - along Sheridan. They are asking for a change in the contract with the city to get out of building the affordable home.  They say they do now own Lot 4 and are therefore not responsible for the affordable unit on that property.  This plan if passed on Thursday would allow the complete build out of eastern Nantucket, and would not provide an affordable unit there.
ELN proposes that the additional 600 ft unit on Andrew would fulfill their obligation. That property would also not have a 30 year time limit and would be managed by a non-profit in the city.

Many people who attended the CPP on October 25, 2010 opposed another higher density housing unit on Andrew. We already have enough.  And many also spoke up against allowing ELN to build out a density bonus development without having to build a proper affordable housing unit...as per the city's contract.  The city would be breaking it's contract, many believe.

If you can weigh in on the subject please send an email to Kerry Kusiak at the city and have him forward your comments to the planning commission. KKusiak@ci.encinitas.ca.us

********************

# 2  There is a CPP (citizens "participation" ) meeting on the proposal to build TWO 30 ft high cell-phone towers at the RE/MAX office site on the corner of La Costa Avenue and Highway 101 - Thursday Dec 2 - also at City Hall.  This proposal would also build a utility building 12 ft high x 12 wide x 50 long on the site.  (That's almost the size of railroad box car)  This is the gateway to Leucadia.  What an ugly image for us.  The city has said in the past they will not fight the increasingly possible severe health hazards of cell-phone towers in the city (even though they don't allow them on fire houses). The only way to fight these tower monsters is from design and neighborhood eyesore issues.

If you can weigh in on the subject please send an email to Kerry Kusiak at the city and have him forward your comments to the appropriate city planner: KKusiak@ci.encinitas.ca.us

************

Many thanks,

Ron Ranson

Made in Encinitas

Do we have much of an  industrial (manufacturing, commercial, or agricultural) base in Encinitas, beyond the service and retail industry? Do we have jobs or job centers here in Encinitas to sustain us locally?

No Calaway, Heidelberg Engineering, Qualcom, ViaSat.

Here is a list of local makers of things. What else do we produce, here in Encinitas?

B. Elliot Sierra Padre Mill Co. 555 N. Vulcan Ave. Zip 92024 Phone 760-753-5368	Bill Iwaisako Print & Copy House 523 Encinitas Blvd., Ste. 104-6 Zip 92024 Phone 760-632-8911	Cynthia Blodgett Blodgett Glass, Inc. 1086 Hygeia Ave. Zip 92024 Phone 760-942-2002	Donnie Valentine T & M Plumbing Enterprises, LLC 132 N. El Camino Real Zip 92024 Phone 760-230-1069
James Shatto Shatto's Shirts 696 Hwy. 101 Zip 92024 Phone 760-436-5542	John W. Concrad Falcon Co. 3435 Jasmine Crest Zip 92024 Phone 858-759-6746	Max F. Afcari Master Plating 1709 Hill Top Ln. Zip 92024 Phone 760-943-1482	Michael Seewald Award Custom Framing 835 N. Vulcan Ave. Zip 92024 Phone 760-633-1351
Patricia Brady Ipanema P.O. Box 230746 Zip 92023 Phone 858-759-5015	Robert Bahne Fins Unlimited 585 Westlake St. Zip 92024 Phone 760-753-8847	Scott Clayton Fine Line Screenprinting 740 N. Hwy. 101 Zip 92024 Phone 760-943-1701	Sherrie Cook Accent Packaging 1042 N. El Camino Real, Ste. B225 Zip 92024 Phone 760-632-5880
T. Wragg Wragg, Inc. 899 Passiflora Ave. Zip 92024 Phone 760-943-0750	William L. Bahne Jr. Bahne & Co. P.O. Box 230326 Zip 92023 Phone 760-753-0255

Poinsettia Time!

Leucadia 101 Mixer Dec 2

You Are Invited to a

Leucadia 101 Main Street Mixer

Find out what’s new in Leucadia!

When: December 2, 2010

Time: 5 - 7:30 pm

Where: JamRoc101 Caribbean Grill,

101 Coast Hwy 101

Enjoy Their Great Caribbean Cuisine – Ya Mon!

Happy Hour Prices for Appetizers & Beverages

Please RSVP by Nov. 29th 760-436-2320

There is no charge to attend!

Thankful

What are thankful for on this day?

Lessons from the State for Encinitas

Selling Assets the Wrong Way

Suppose a grinning real estate agent knocks on your door with a proposal.  He will buy your home (which you own free and clear) for a fair price if, in return, you promise to spend all the proceeds within one year and agree to rent back your property over the next 20 years for an amount that exceeds what you were paid.  At the end of 20 years you will have to arrange a new rental agreement or become homeless.

At this point most property owners would recognize a scam and some might even summon the family pit bull to make sure that the slick salesman beats a hasty retreat. 

However, what is an obvious scam to average taxpayers is called sound public policy by Sacramento politicians.

The Schwarzenegger administration plans to sell 24 state buildings, including the Ronald Reagan State Building in downtown Los Angeles, to raise $1.2 billion to help offset the budget deficit.  If these were surplus properties for which the state had no further use, taxpayers would be cheering.  Indeed, we’ve consistently argued that the state’s real estate portfolio has been mismanaged and offloading surplus property should be vigorously pursued.  There is, for example, no reason whatsoever for the state owning a golf course which could be better managed in the private sector.

But, sadly, this is not the case with the current proposal.  These are facilities that are being used and are important enough that the state is agreeing to lease back these properties for the next 20 years.  Here is how this pencils out according to the Legislative Analyst's Office:  The transaction amounts to borrowing at 10% interest over the next 35 years, an amount much more than the state pays for bonds.

Indeed, the long term financial commitment – in the form of a 20 year lease – is a stark admission that the subject property is not surplus.  Thus we have the worst of all worlds from the perspective of fiscal prudence:    All downside and no upside (other than a quick infusion of cash that will be quickly squandered by the same political elites who are more focused on the debate over the official state rock than they are with balancing the budget).

This deal also runs contrary to the spirit of the law which requires voter approval of long term financial commitments.  But the forces behind this scam know that voters would never agree to so burden the next generation of Californians which is why they are jamming through this sale that does nothing to fix the state’s addiction to overspending and, in fact, makes it worse.

Only in Sacramento does this make sense.  Unemployment is up, personal income is down and so, too, is revenue to government.  The politician’s response is to use tricks to avoid reality and the obvious need to cut back on spending in these times of economic crisis.  Their goal is preserve the government status quo, regardless of how much it hurts already beleaguered taxpayers.

Ironically, the only two voices of reason that are coming from Sacramento on this issue are two officials affiliated with the political party not renowned for fiscal prudence.  State Controller John Chiang and Treasurer Bill Lockyer, both Democrats, have blistered the real estate agreement as bad for taxpayers.  Both serve on the Public Works Board, which granted final approval of the arrangement, but were outvoted by three Schwarzenegger appointees.

Taxpayers will be burdened with decades of lease payments, said Lockyer, while Chiang called the property sale and lease back another budget gimmick that pushes the state's fiscal challenges down the road.  A spokesman for the one of the firms involved in financing the deal has been quoted as saying, "We're happy we came out on top."

The firms involved in this horrible deal did in fact come out on top.  But the taxpayers came out on the bottom.

Now, where is the dog when we need him?

Jon Coupla (www.hjta.com)

City Hall Gets Touchy Feely

It is kinda funny how most of the council thinks that the government shouldn't be involved in telling developers what their developments should look like and then at the General Plan Workshop the attendants are asked how they "feel" about a bunch of photos of different street frontages. A lot of time was spent on that.

At the meeting, staff said the images wouldn't be online so we had to come up with our own set.

"How do you feel when you see?"

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