BLUE FOLDER ITEM
Blue folder items are additional back up material to administrative reports and/or public comments received after the printing and distribution of the agenda packet for receive and file.
CITY COUNCIL MEETING
MAY 21, 2024
J.1 PUBLIC PARTICIPATION ON NON-AGENDA ITEMS
• PUBLIC COMMUNICATIONS
From: Stop BCHD
To: [email protected]; [email protected]
Cc: [email protected]; Michelle Bholat; Noel Chun; Jane Diehl; CityClerk; [email protected]; [email protected]; [email protected]; [email protected]; info; [email protected]; Zein Obagi; Nils Nehrenheim; Todd Loewenstein; Paige Kaluderovic; Scott Behrendt Subject: BCHD"s Decision to Agree to nearly $150M in allcove Indebtedness without Financial Analysis or Public Vote Date: Monday, May 20, 2024 8:56:59 PM
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LETTER OF PUBLIC INQUIRY: BCHD Counsel, LA County Counsel, LA District Attorney PUBLIC COMMENT: Councils and Counsels of HB/MB/RB
PUBLIC COMMENT: Boards of LA County and LALAFCO
To Whom It May Concern and Submitted in the Interest of Protection of District Taxpayers:
District Taxpayer Indebtedness Risk of allcove Beach CIties is nearly $150M BCHD has indebted District Taxpayers to nearly $150M in allcove Beach Cities liability. BCHD is obligated to operate allcove Beach Cities services and building for at least 30 years following initial operations of the allcove building. This is based on BCHD's acceptance of partial construction funding for the allcove Beach Cities building that requires a 30 year building and land restriction and obligation to operate the mental health building and services. These were terms of the grant application.
At present, we calculate the potential District Taxpayer obligation across 30 years to be:
BCHD Proposed Bond Obligation committed to allcove: $ 10.0M BCHD Estimated Bond Obligation Debt Service @5%: $ 15.0M BCHD 30-YR Building Shell Operations Obligation: $ 9.9M BCHD 30_YR allcove Services Obligation: $104.0M
BCHD Land Rent donation of the allcove Taxpayer Site:
$ 9.7M
$148.6M TAXPAYER LIABILITY OR COST
BCHD has a 30-Year allcove Obligation yet NO Secure Funding for allcove Beach Cities past June 2026
While BCHD intends to be successful with grant funding, BCHDs current grant funding expires in June 2026 before the building and 30 year operating guarantee by BCHD even begins. That leaves District Taxpayers with an immense potential debt. As a reminder, the Daily Breeze has elegantly published an article about the financial distress, layoffs, and ultimate license termination of the public South Bay Hospital in 1984. District financial failure has already occurred once and from a Taxpayer liability perspective, must be assumed in computation of risk.
District Residents Represent only 9% of allcove Beach Cities Service Area - Yet They Bear 100% Financial Risk
BCHDs Board actions are particularly disturbing because 91% of the 1.4M population LA County SPA8 service area of allcove Beach Cities is comprised of Non-Residents of the District. Therefore, this indebtedness risk is a 100% obligation for Taxpayers while they represent only 9% of the allcove service area. District Taxpayers are only 9% of the allcove Beach Cities service area population, and therefore face a cost risk of over 10-to-1.
The District was Established for Residents who Reside Within the DIstrict That level of obligation for a District Taxpayers is highly inappropriate for a District founded and funded by voters who reside within the District. Furthermore, the most contemporaneous statement of voter intent for the District comes from the 1957 pleading by the District with the Superior Court for land condemnation. The District tells the Court that it requires the land for the hospital for the "residents who reside" within the District. Not for non-residents, and certainly not for the totality of SPA8's 1.4M population.
allcove Beach Cities Indebtedness Exceeds District Asset Value Without considering the potential for significant economy-wide cost escalation as we have recently witnessed, the $148.6M Taxpayer obligation of allcove Beach Cities significantly exceeds the asset value of the District which is $55.8M per the last District financial audit. That makes the debt of allcove Beach Cities nearly 300% of the asset value of the District, and surely worthy of a public vote.
BCHD Board and Executive Management Failed to Conduct Appropriate Due Diligence of the allcove Beach Cities cost to Taxpayers
Unbelievably, when BCHD was presented with a Public Records Act request for their 30 year analysis of allcove costs, the District response was "no records." It is inconceivable that an organization of any kind would take on a 30-year obligation without first computing the exposure and PV of the obligation. BCHD clearly states that it did not compute such an obligation.
Should allcove Beach Cities, a 91% Non-Resident Building and Service, Required a Public Vote for $150M in Cost Risk?
Surely had BCHD Board and Executive Management undertaken an obligation that was fully funded this would not be an issue. And surely had BCHD been providing equal measures of costs and benefits to District Residents, this would merely be another program. However, allcove Beach Cities is effectively a speculative pseudo-business where District Taxpayers fund 100% of the risk, represent a small 9% share of the Service Area, and rely on the goodwill of donors and grant-makers to cover the costs. BCHD committed to this 30-year obligation without analysis of the cost or of the need for a public indebtedness vote.
It is now time for the legal counsels of the District, County and DAs Office to review BCHD's actions in an attempt to protect District Taxpayers from potential catastrophic financial losses, bankruptcy, and Court-ordered tax assessments for 30 years to cover the debt that BCHD Board and Executive Management has obligated those Taxpayers to pay.
District Taxpayers deserve a full review of how they were saddled with nearly $150M in obligations without a vote.
Supporting Analysis Below
BCHD Records Response - No 30 Yr Analysis
SPA8 Population Analysis - 9% District
image.png
BCHD Bond Proceeds - $10M allcove
30 YEAR BOND DEBT SERVICE - $15M
$10M * 30YRS * 5% = $15M
30 Year Building Operation Cost - $9.9M
30 Year allcove Beach Cities Operating Cost - $104M
30 Year Land Rent Donation for 0.5AC Flagler & Beryl Lot - $9.6M Taxpayer Market Value of allcove Building 30-year Free Use - $9.6M 30 Year Obligation Language
Current allcove Funding Termination of June 2026
--
StopBCHD.com ([email protected]) is a Neighborhood Quality-of-Life Community concerned about the quality-of-life, health, and economic damages that BCHDs 110-foot above the street, 800,000 sqft commercial development will inflict for the next 50-100 years. Our neighborhoods have been burdened since 1960 by the failed South Bay Hospital project and have not received the benefit of the voter-approved acute care public hospital since 1984.Yet we still suffer 100% of the damages and we will suffer 100% of the damages of BCHDs proposal.
From: Mark Nelson (Home Gmail)
To: PRR
Cc: CityClerk; [email protected]; [email protected]; [email protected] Subject: CPRA - Sesimic
Date: Wednesday, May 15, 2024 6:13:08 PM
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Provide documents demonstrating the probabilistic financial analysis demonstrating the date that the expected value of seismic costs/damages liability exceeds the net revenues from aggressive leasing of the 514 N Prospect building. The following document conducts NO FINANCIAL ANALYSIS or EXPECTED VALUE ANALYSIS:
https://www.bchdcampus.org/sites/default/files/archivefiles/514%20Building_Structural%20Cost_Seismic%20Evaluation%20Info.pdf Clearly if BCHD is telling the public that it is required to demolish or retrofit, there is a public financial analysis clearly demonstrating the decision to destroy a taxpayer asset. cc: Public Comment to HB/RB/MB City Councils
cc: StopBCHD internal list
From: Joan Davidson
To: CityClerk
Subject: I oppose the Bond!
Date: Tuesday, May 14, 2024 9:45:58 PM
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To whom it may concern,
I have never seen such lack of public concern by a public entity such as BCHD to build a monster building in the beautiful surrounding neighborhoods and parks.
Also the cost keeps going up year by year. A bond is the worst idea. People are fed up at this point.
Enough is enough!
Joan Davidson
Redondo Beach
From: Mark Nelson (Home Gmail)
To: Garth Meyer; Kevin Cody
Cc: CityClerk
Subject: Make BCHD provide the evidence - SPECIFICALLY - for this claim Date: Sunday, May 19, 2024 2:04:53 PM
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Gentlemen:
I don't know what press release the quote below in your story came from, but, it simply isn't supported by any public documents or analysis provided by BCHD. "A seismic risk assessment commissioned by BCHD shows that the old hospital will exceed acceptable risk standards in two and a half years." I spent years in nuclear power and seismic risk assessment. I am EPRI Seismic Probabilistic Risk Assessment Training certified. I am by training an economic statistician and have functioned as an expert witness for decades now.
I know what a seismic risk analysis looks like and how a probabilistic risk assessment and economic analysis are done. BCHD WANTS to tear down the hospital. BCHD has no objective evidence demonstrating that the seismic financial risk cannot be cost-effectively mitigated. Further, BCHD's own consultant, Youssef Assoc. stated that the City of LA Seismic Ordinance is the most stringent in the US, however it does not apply outside of the City of LA. That ordinance considers public safety ONLY and as such, it's 25 year continued use is the "best practice" for aging buildings.
But if that "best practice" ordinance is applied to the Hospital building, it would provide:
3 years for initial evaluation using the City of LA methodology 10 years to prepare both detailed demolition plans and also detailed retrofit plans (if desired) 25 years of continued use of the building prior to demolition or retrofit.
THAT IS BEST PRACTICE. CLEARLY BCHD IS NOT FOLLOWING BEST
PRACTICE, NOR HAS BCHD PROVIDED ANY DETAILED SEISMIC FINANCIAL
RISK MITIGATION USING INDUSTRY STANDARD INSURANCE PRACTICES FOR THE 25 YEAR PERIOD.
Public Comment: Redondo City Council
From: Richard Loeffler
To: CityClerk; Communications
Subject: OPPOSE THE BCHD TAX
Date: Thursday, May 16, 2024 2:25:14 PM
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I oppose the BCHD tax proposal.
From: Mark Nelson (Home Gmail)
To: Communications
Cc: CityClerk; [email protected]; [email protected]; City Council; Holly J. Mitchell; [email protected]; Noel Chun; Jane Diehl; Michelle Bholat; Martha Koo Subject: Public comment - all agencies - BCHD is placing far too much allcove cost and risk on Resident-Taxpayers Date: Tuesday, May 14, 2024 4:59:39 PM
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From: Mark Nelson (Home Gmail)
To: Metro Community Relations; [email protected]
Cc: CityClerk; [email protected]; Holly J. Mitchell; Nils Nehrenheim; Zein Obagi Subject: Public Comment - Descriptive Video of Metro"s Planned Destruction of Lawndale Homes Date: Thursday, May 16, 2024 5:40:12 PM
Attachments: Metro Demolition Plan for Homes due to Poor Greenline Route.mp4 CAUTION: Email is from an external source; Stop, Look, and Think before opening attachments or links.
Please see the excellent attached video by an impacted Redondo Beach citizen. Metro should NOT be considering adding 24/7/365, 200-300 trip per day rail through backyards of homes to extend the Greenline. The Hawthorne Blvd route through commercial land is a much better route.
Mark Nelson
Redondo Beach
It can also be found at https://www.facebook.com/reel/466091779170956 From: Stop BCHD
To: CityClerk; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]
Cc: Noel Chun; [email protected]; Jane Diehl; Michelle Bholat; Communications Subject: Public Comment - Easy Reader News Opinion by Bob Pinzler Date: Thursday, May 16, 2024 3:50:04 PM
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PUBLIC COMMENT ALL AGENCIES ELECTEDS AND BOARDS
As StopBCHD has pointed out quantitatively through analysis of BCHD's published Healthy Living Campus plan, the HLC supports a supermajority of non-residents of the district by 80% to 95% of facility use.
BCHD refuses to provide any enrollee data regarding the PACE facility. However, the National PACE Association provided data showing that on average, only 17 seniors of the 17,000 in the District will benefit. That is less than 5% of BCHD's proposed 400 enrollee facility (per Cain Bros, BCHD's investment banker). BCHD intends to use District land and resources for PACE.
BCHD signed up for allcove, service all of LA County SPA8. That's 1.4M population, so the District is only 9%. Yet, BCHD is providing use of a free $4M land parcel, uncompensated District employees, and $10M for additional allcove building funding. BCHD is required to operate allcove and its building for 30 years per the State BHCIP funding agreement. Again, District resources supporting 91% non-residents.
BCHD's assisted living is market rate, on District land, and BCHD's MDS consultants demonstrated by zip code that the assisted living services 80% non-resident tenants. As such, the HLC is 80% to 95% non-resident benefit with District assets, land, buildings, and staff.
BCHD's seismic consultant, Youssef Assoc, stated that there are no ordinances that require BCHD to either retrofit or demolish the Hospital building. Further, Youssef stated that even the most stringent seismic ordinance (LA City's which does not apply to Redondo Beach) would allow for 25 years of continued use before demolition or retrofit. As such BCHDs desire to demo the Hospital is not required nor necessary. It is also not supported by any detailed financial analysis that BCHD has provided.
Councilmember Pinzler hits the nail on the head regarding BCHD:
On Local Government: The “Save Their Butt” tax
SPECIAL CONTRIBUTOR|MAY 15, 2024
by Bob Pinzler
If all goes according to plan, on the November 2024 ballot property owners in our three beach cities will be asked to approve a 30-million-dollar tax measure which the Beach Cities Health District (BCHD) is calling a “Health and Wellness Bond.” It should be called the 30-milliondollar fix for their screw-ups.
Let’s break it down. Of that total, $8 million is dedicated to demolishing the antiquated South Bay hospital building. You might think, of course, it is going to take money to remove that facility. The problem is that when the District pitched its Wealthy Living Campus to us, that cost was to be included in the developer’s responsibilities. It was one of their bigger selling points.
However, as the District and the developer could not reach a financial agreement, the District decided to take on that cost themselves and gift it to the developer.
An additional $3 million is allocated to building a new allcove mental health center for youth.
This would be fine except that the District already received a grant from the State to cover the building costs. But now the District wants to add new “bells and whistles,” which have nearly doubled the projected cost. The State will not cover these additions.
Then, there is $7 million for the creation of open space. Ignoring the fact that the new open space would be just across the street from another Redondo city park, this type of facility is primarily used by people in its vicinity. Thus, open-space-poor cities like Hermosa and Manhattan Beach will be paying for a park in South Redondo. For up to 30 years.
Finally, there is a provision for $5 million for planning, architecture, and engineering. BCHD has already spent over $12 million dollars on this project, for which it seems to have gotten nothing except vague plans and some pretty promotional materials. One would have thought basics such as those found in any project would have been done before asking the public for funds to cover their inadequacies.
The only thing this request for additional money proves is that BCHD has not been a good steward of the many millions of dollars they have received from our property taxes. Having been provided a windfall when the last tenant left the hospital, BCHD has squandered it over the years, leading them to the existential panic, which has led them to this misbegotten position. This is not a “Health and Wellness Bond.” This is a “Save Their Butt” tax.
It is time for BCHD to take heed of the warning sent to it by the Local Area Formation Commission, an organization that monitors special districts, of which BCHD is one. They said that BCHD had spread its influence outside the area it was created for. Both of the projects they are asking us to fund are primarily for the use of people outside the district. Why should we pay the mortgage for that? BCHD should withdraw its planned tax measure and fix its own operations before asking us for anything more. ER
https://easyreadernews.com/on-local-government-the-save-their-butt-tax/ --
StopBCHD.com ([email protected]) is a Neighborhood Quality-of-Life Community concerned about the quality-of-life, health, and economic damages that BCHDs 110-foot above the street, 800,000 sqft commercial development will inflict for the next 50-100 years.
Our neighborhoods have been burdened since 1960 by the failed South Bay Hospital project and have not received the benefit of the voter-approved acute care public hospital since 1984.Yet we still suffer 100% of the damages and we will suffer 100% of the damages of BCHDs proposal.
From: Mark Nelson (Home Gmail)
To: Communications; CityClerk; [email protected]; [email protected]; City Council; CityClerk; Holly J. Mitchell; [email protected]; info; Jane Diehl; Martha Koo; Michelle Bholat; Noel Chun; Nils Nehrenheim; Todd Loewenstein; Paige Kaluderovic; Zein Obagi; Scott Berhrendt; [email protected]; [email protected]; Metro Community Relations Cc: Kevin Cody
Subject: Public Comment - Letters to the Editor regarding BCHD Date: Tuesday, May 14, 2024 5:11:20 PM
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Friendship lesson
Dear ER:
Beach Cities Health District could learn a thing or two from The Friendship Foundation and Homeboy Industries. These two organizations serve their target populations spectacularly well, are financially self sustaining, and do not burden the taxpayer. BCHD on the other hand, has taxation baked into their DNA. The District was created in the 1950’s to build a hospital through property taxation. The hospital opened in 1960 and became obsolete and ceased operations in By all rights, BCHD should have ceased to exist at that time becausethe purpose for its establishment was now gone. But in mission creep over the years that would make GW blush, BCHD is still here, serving an ever narrowing population and proving that there is nothing so permanent as a temporary tax. Sure, I know the argument, if it dissolves, the tax doesn’t go away it just gets absorbed into a bloated bureaucratic county budget. So why not spend the money locally? Fine. But not only does BCHD get our tax money, it has over 250,000 square feet of income property. So how dare it even consider coming back to us for more as a bond issue.
Warren Barr
Hermosa Beach
New isn’t necessary
Dear ER:
BCHD now wants a $30 million taxpayer bond issue after it spent $4,500 per foot on a bike path? I don’t think so. The bond is supposedly for the allcove building and demolition of the South Bay Hospital building.
Neither one of those proposals is a good use of district taxpayer funds. allcove is an LA County Service Planning Area 8 program that encompasses a 1.4 million population. Of that, the District is only 120,000 or 9%. Why does BCHD believe that 9% of the service area should pay $10M for the allcove building and upgrades out of the total $17 million cost? The irrationality doesn’t end there. BCHD received a meager $6 million state grant toward the cost of the allcove building, and that grant required BCHD agree to operate the building and its health services for at least 30 years. BCHD has no funding past mid-2025. That leaves District taxpayers at risk for the $100 million that 30 years of allcove program operations will cost. Sure, BCHD will apply for grants year after year, but District residents and taxpayers are always the backstop for that $100 million risk BCHD signed us up for. If grants don’t completely fund it, District taxpayers, only 9% of the allcove service area, are on the hook.
BCHD continues to pitch the fiction that the hospital building must be torn down because it doesn’t meet current seismic standards. That’s nonsense.
BCHD’s Youssef consultants told the Community Working Group in writing that no upgrades are required to continue use of the building. My 2015 car doesn’t meet current safety standards. My 2020 refrigerator doesn’t meet current energy standards. My 1966 house doesn’t meet current seismic standards. Should I landfill the car and refrigerator and demolish the house? That’s what BCHD suggests is the fiscally responsible solution.
It’s crazy talk to suggest that every building that doesn’t meet current seismic standards should be demolished. If BCHD were truly concerned about the failed Hospital building’s safety, why is it occupied today and collecting rent?
Just say NO to a BCHD bond for allcove and just say no to building demolition.
Mark Nelson
Redondo Beach
From: Stop BCHD
To: Communications
Cc: CityClerk; [email protected]; [email protected]; [email protected]; [email protected]
Subject: Public Comment - OPPOSE - BCHD Bond Issue
Date: Tuesday, May 14, 2024 8:56:51 PM
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The following is a Public Comment for the Mayors, City Councils, City Counsels of the addressed Cities, as well as, for each of the three BCHD public meetings.
We at StopBCHD.com oppose BCHD's proposed bond issue. BCHD has shown that it is not responsible for expenditures as demonstrated by the $1.7M, 400-foot bike path that appears based on searches to be the single most expensive bike path development in the US per foot of construction. At $22 million-a-mile cost, BCHD's bike lane eclipsed even Seattle's downtown, urban cost at a "startling $12 million-a-mile" (Seattle Times description).
With respect to each component of BCHD's ask:
allcove is 91% non-resident service area and as such, BCHD should not be spending $10M of resident-taxpayer funding on the allcove building project. That is simply inappropriate expenditure for a District founded and funded by three Cities.
BCHD has already spent $12M on consultants of various types for the Healthy Living Campus plan. That is over 3 years of resident-taxpayer property tax revenues. It appears increasingly unlikely that BCHD will receive any PMB reimbursement. As such, spending $5M more after $12M of bad expenditures fails any reason test.
Last, BCHDs consultants presented findings that clearly demonstrated that the 514 N Prospect building has no current ordinances that require retrofit or demolition. Any demolition or retrofit is a purely voluntary, non-required act at this time. As such, $8M for demolition is not required, nor would the $7M amount for paving, sod, and greenery for the 2 acres.
It is clear that BCHD has lost its way. The District condemned the private development land that was already plotted for homes on N Prospect by pleading to the Superior Court that the District required the land for the benefit of the "residents who reside" in the District. That was the scope of the voter approval based on the 1957 contemporaneous pleading document from the District to the Superior Court in Inglewood.
At some point, BCHD's executive and Board have allowed their ego needs to usurp their obligation to "residents who reside" in the District as BCHD pursues manifest destiny within LA County.
We OPPOSE the bond and will actively fight it if put on the ballot. --
StopBCHD.com ([email protected]) is a Neighborhood Quality-of-Life Community concerned about the quality-of-life, health, and economic damages that BCHDs 110-foot above the street, 800,000 sqft commercial development will inflict for the next 50-100 years.
Our neighborhoods have been burdened since 1960 by the failed South Bay Hospital project and have not received the benefit of the voter-approved acute care public hospital since 1984.Yet we still suffer 100% of the damages and we will suffer 100% of the damages of BCHDs proposal.
From: Stop BCHD
To: CityClerk; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]
Cc: Jane Diehl; Michelle Bholat; Noel Chun; [email protected] Subject: PUBLIC COMMENT: Proposal for "Fair Share" Spending by BCHD on allcove - 9% Date: Friday, May 17, 2024 7:13:39 PM
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allcove Beach Cities's Service Area is SPA8. That is 1.4.M population, while the District cities of Hermosa Beach, Manhattan Beach and Redondo Beach are 120,000 population. That means that the District makes up only 9% of the allcove Beach Cities Service Area.
AS SUCH - BCHD "FAIR SHARE"
SPENDING ON allcove MUST BE
LIMITED TO 9% OF allcove TOTAL
OPERATING AND CAPITAL COSTS
The analysis below demonstrates the four cost centers of allcove and the BCHD share based on current cost estimates:
#1 allcove OPERATING COSTS MAXIMUM 9%
PAYMENT OF ONLY 9% OF allcove OPERATING COSTS BY
BCHD
The current allcove operating budget from BCHD:
FY Expense 9% District LIMIT
2024-25 $1.9M$171K
2025-26 $2.0M $180K
2026-27 $2.1M $189K
2027-28 $2.2M $198K
#2 allcove EXECUTIVE & STAFF OVERHEAD REIMBURSEMENT
OF 91%
allcove REIMBURSEMENT OF 91% OF BCHD EXECUTIVE AND
STAFF COSTS
Staff and executives must keep timesheet hours of their planning, management and participation in allcove. allcove must reimburse 91% of the FULLY LOADED COST of BCHD staff.
#3 allcove BUILDING COSTS MAXIMUM 9%
PAYMENT OF ONLY 9% OF allcove BUILDING COSTS BY BCHD
The current allcove building construction budget from BCHD ranges from $7.4M to $10.9M. That would cap BCHD's expenditures on the allcove building at $666K to $981K with all other funding coming from other sources. #4 allcove BUILDING LAND RENT REIMBURSEMENT OF 91%
BCHD and its investment bankers, Cain Bros., determined that the appropriate rent for 3 acres to PMB was $1.5M per year. That is $250,000 per 1/2-acre. In addition, BCHD provided a rent adjustment escalator. allcove must reimburse District taxpayers 91% of the $250,000 in fair market value land rent each year for the 1/2-acre lot at Flagler & Beryl that will site the building. That is $228K (91% of $250,000) in the first year that allcove must reimburse District taxpayers with an escalation throughout the period. https://www.stopbchd.com/post/proposed-limit-on-bchd-allcove-spending-9-of-total-costs --
StopBCHD.com ([email protected]) is a Neighborhood Quality-of-Life Community concerned about the quality-of-life, health, and economic damages that BCHDs 110-foot above the street, 800,000 sqft commercial development will inflict for the next 50-100 years.
Our neighborhoods have been burdened since 1960 by the failed South Bay Hospital project and have not received the benefit of the voter-approved acute care public hospital since 1984.Yet we still suffer 100% of the damages and we will suffer 100% of the damages of BCHDs proposal.
From: Mark Nelson (Home Gmail)
To: CityClerk; Michael Webb; Communications
Subject: Re: CPRA - BCHD Polling
Date: Friday, May 17, 2024 6:07:26 PM
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PUBLIC COMMENT REDONDO BEACH COUNCIL & CITY ATTORNEY
Regarding the PRR to BCHD: I was forwarded a copy from one of our team of a presentation to BCHD.
It states:
Based on what you know now, or just my mentioning it, do you favor or oppose the Healthy Living Campus plan to replace the Beach Cities Health District building and adjacent medical building with a new campus which would have a new health and wellness building including community health and wellness services, assisted living and memory care for seniors, as well as a youth mental health center, an aquatics center, health and fitness center, and open green space for public use?
BEACH CITIES HEALTH DISTRICT COMMUNITY HEALTH/WELLNESS MEASURE To upgrade safety of local health/wellness/medical buildings, remove asbestos, mold, lead paint; upgrade/complete youth mental health center; provide open green space for youth/senior/community health programs with recycled water for landscaping, shall Beach Cities Health District’s measure authorizing $30,000,000 in bonds, at legal rates, levying $3.00 per $100,000 of assessed valuation, generating $1,700,000 annually while bonds are outstanding, be adopted, requiring public spending disclosure, all funds used locally? 1) It appears that your response based on the direct quotes of the FM3 presentation will be that information about SUPERMAJORITY NON-RESIDENT USAGE was deliberately WITHHELD during survey polling. That provided a false view to likely voters. I am very disappointed that BCHD is failing to tell voters the truth that 80% of the assisted living, 91% of allcove, and 95% of PACE will be non-resident service areas/enrollees/tenant prospects.
2) The PRR of 5/17 @1120 stands and must be responded to by BCHD for completeness of the record.
On Fri, May 17, 2024 at 11:20 AM Mark Nelson (Home Gmail) wrote:
This PRR is with respect to the poll described by:
As part of the exploration of a bond, this spring the District hired a public policy research firm, FM3 (Los Angeles), to conduct a survey of 650 beach cities respondents between April 13 and April 18. Results found that 66% of likely voters in the three beach cities believe there is a need to fund local community health and wellness services, an increase of 14% from a similar survey in fall 2021.
1. Provide documents demonstrating that the BCHD polling disclosed that the HLC is expected to be 80% to 95% non-resident benefit based on Service Area, PACE enrollee, and RCFE tenants.
2. Provide documents demonstrating that the polling disclosed that allcove Beach Cities has a Service Area of SPA8 and is 91% non-resident of the District population
3. Provide documents demonstrating that the polling disclosed that BCHD consultant MDS study found that zipcodes 90254, 90266, 90277, 90278 contain only 20% of the RCFE tenant prospects has a Service Area of SPA8 and is 91% non-resident of the District population
4. Provide documents demonstrating that the polling disclosed that only 1 in 1000 seniors uses PACE, and there only 17 of the 400 enrollees in PACE at BCHD are anticipated by the National PACE Association data to be residents
From: Stop BCHD
To: [email protected]; [email protected]
Cc: [email protected]; Michelle Bholat; Noel Chun; Jane Diehl; CityClerk; [email protected]; [email protected]; [email protected]; [email protected]; info; [email protected]; Zein Obagi; Nils Nehrenheim; Todd Loewenstein; Paige Kaluderovic; Scott Behrendt Subject: Updated with all Images due to link failure: BCHD"s Decision to Agree to nearly $150M in allcove Indebtedness without Financial Analysis or Public Vote Date: Monday, May 20, 2024 9:56:38 PM
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On Mon, May 20, 2024 at 8:56 PM Stop BCHD <[email protected]> wrote:
LETTER OF PUBLIC INQUIRY: BCHD Counsel, LA County Counsel, LA District Attorney PUBLIC COMMENT: Councils and Counsels of HB/MB/RB
PUBLIC COMMENT: Boards of LA County and LALAFCO
To Whom It May Concern and Submitted in the Interest of Protection of District Taxpayers:
District Taxpayer Indebtedness Risk of allcove Beach CIties is nearly $150M BCHD has indebted District Taxpayers to nearly $150M in allcove Beach Cities liability. BCHD is obligated to operate allcove Beach Cities services and building for at least 30 years following initial operations of the allcove building. This is based on BCHD's acceptance of partial construction funding for the allcove Beach Cities building that requires a 30 year building and land restriction and obligation to operate the mental health building and services. These were terms of the grant application.
At present, we calculate the potential District Taxpayer obligation across 30 years to be:
BCHD Proposed Bond Obligation committed to allcove: $ 10.0M BCHD Estimated Bond Obligation Debt Service @5%: $ 15.0M BCHD 30-YR Building Shell Operations Obligation: $ 9.9M BCHD 30_YR allcove Services Obligation: $104.0M
BCHD Land Rent donation of the allcove Taxpayer Site:
$ 9.7M
$148.6M TAXPAYER LIABILITY OR COST
BCHD has a 30-Year allcove Obligation yet NO Secure Funding for allcove Beach Cities past June 2026 While BCHD intends to be successful with grant funding, BCHDs current grant funding expires in June 2026 before the building and 30 year operating guarantee by BCHD even begins. That leaves District Taxpayers with an immense potential debt. As a reminder, the Daily Breeze has elegantly published an article about the financial distress, layoffs, and ultimate license termination of the public South Bay Hospital in 1984. District financial failure has already occurred once and from a Taxpayer liability perspective, must be assumed in computation of risk.
District Residents Represent only 9% of allcove Beach Cities Service Area - Yet They Bear 100% Financial Risk BCHDs Board actions are particularly disturbing because 91% of the 1.4M population LA County SPA8 service area of allcove Beach Cities is comprised of Non-Residents of the District. Therefore, this indebtedness risk is a 100% obligation for Taxpayers while they represent only 9% of the allcove service area. District Taxpayers are only 9% of the allcove Beach Cities service area population, and therefore face a cost risk of over 10-to-1.
The District was Established for Residents who Reside Within the DIstrict That level of obligation for a District Taxpayers is highly inappropriate for a District founded and funded by voters who reside within the District. Furthermore, the most contemporaneous statement of voter intent for the District comes from the 1957 pleading by the District with the Superior Court for land condemnation. The District tells the Court that it requires the land for the hospital for the "residents who reside" within the District. Not for non-residents, and certainly not for the totality of SPA8's 1.4M population.
allcove Beach Cities Indebtedness Exceeds District Asset Value Without considering the potential for significant economy-wide cost escalation as we have recently witnessed, the $148.6M Taxpayer obligation of allcove Beach Cities significantly exceeds the asset value of the District which is $55.8M per the last District financial audit. That makes the debt of allcove Beach Cities nearly 300% of the asset value of the District, and surely worthy of a public vote.
BCHD Board and Executive Management Failed to Conduct Appropriate Due Diligence of the allcove Beach Cities cost to Taxpayers
Unbelievably, when BCHD was presented with a Public Records Act request for their 30 year analysis of allcove costs, the District response was "no records." It is inconceivable that an organization of any kind would take on a 30-year obligation without first computing the exposure and PV of the obligation. BCHD clearly states that it did not compute such an obligation.
Should allcove Beach Cities, a 91% Non-Resident Building and Service, Required a Public Vote for $150M in Cost Risk? Surely had BCHD Board and Executive Management undertaken an obligation that was fully funded this would not be an issue.
And surely had BCHD been providing equal measures of costs and benefits to District Residents, this would merely be another program. However, allcove Beach Cities is effectively a speculative pseudo-business where District Taxpayers fund 100% of the risk, represent a small 9% share of the Service Area, and rely on the goodwill of donors and grant-makers to cover the costs. BCHD committed to this 30-year obligation without analysis of the cost or of the need for a public indebtedness vote.
It is now time for the legal counsels of the District, County and DAs Office to review BCHD's actions in an attempt to protect District Taxpayers from potential catastrophic financial losses, bankruptcy, and Court-ordered tax assessments for 30 years to cover the debt that BCHD Board and Executive Management has obligated those Taxpayers to pay.
District Taxpayers deserve a full review of how they were saddled with nearly $150M in obligations without a vote.
Supporting Analysis Below
BCHD Records Response - No 30 Yr Analysis
SPA8 Population Analysis - 9% District
BCHD Bond Proceeds - $10M allcove
30 YEAR BOND DEBT SERVICE - $15M
$10M * 30YRS * 5% = $15M
30 Year Building Operation Cost - $9.9M
30 Year allcove Beach Cities Operating Cost - $104M
30 Year Land Rent Donation for 0.5AC Flagler & Beryl Lot - $9.6M Taxpayer Market Value of allcove Building 30-year Free Use - $9.6M 30 Year Obligation Language
Current allcove Funding Termination of June 2026
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StopBCHD.com ([email protected]) is a Neighborhood Quality-of-Life Community concerned about the quality-of-life, health, and economic damages that BCHDs 110-foot above the street, 800,000 sqft commercial development will inflict for the next 50-100 years. Our neighborhoods have been burdened since 1960 by the failed South Bay Hospital project and have not received the benefit of the voter-approved acute care public hospital since 1984.Yet we still suffer 100% of the damages and we will suffer 100% of the damages of BCHDs proposal.