There is no magic pot of money at the end of the rainbow.

Recently I've mentioned some comments I've received here from Dr. Paul. If you havent seen those, feel free to browse around and check them out. Dr. Paul is an admitted skeptic, however he is asking the right questions. I can't say I agree with everything he says, particularly when he says we shouldn't be discussing the clear ethical breaches of the opposition, but I certainly respect his thoughts.

In that light, a couple days ago the doc asked me to post something here. It's a bit long for a comment, and more general then what might conveniently fit into the comment secion of any of my missives. So in that light, I'm going to run it here as a guest comment. No, it doesn't mean I'm having second thoughts, or that I'm anything less than 100% for incorporation. But it does mean I am willing to debate. I'm hoping this sparks some debate here. Feel free to respond with your thoughts, but remember the doc is a guest in my house.

A wise man once told me that it was only acceptable, but essential, to question authority. Because any real authority worth following is capable of standing up to the questions. So with that, here's Dr. Paul:


I’ve read that 40% of our tax dollars go elsewhere in the County. I’ve read that we will be ahead by $60 million at the end of ten years. The idea is that wonderful things can be done with all that money.

The LAFCO Report and the Executive Summary provide the best set of numbers. (It’s hard to read and it seems to me like there are some inconsistencies across the two final reports.)

A City needs to bring in more than it spends each year. On average and at the end of ten years, the New City will be bringing in about 9% more than what it needs while maintaining required reserves. According to the standards used, LAFCO says that the New City “may be” fiscally feasible. For them to come out straight up and say that the numbers work, we would have to be taking in 10% or more of what we are going to spend. So it may or it may not work, but they also said that the numbers “strongly indicate” that the New City is not infeasible.

They are assuming there will be no tax increases. And they did not see either a need or a possibility for any when saying that the New City may be feasible.

Their spending projections are just for operations and maintenance and do not include any capital improvements. Those will come from the County under other funding mechanisms, but we should not expect that the New City will go out on any development programs on its own.

The report also shows comparisons with the other new cities in the County. At current service levels, Folsom and Rancho are spending a lot more than is being spent in Arden Arcade on a per capita basis. Elk Grove and Citrus Heights also have expenditures greater than Arden Arcade. But the thing is, except for Citrus Heights, those cities also have a lot more money coming in for each resident.

(Folsom and Rancho are way ahead primarily because of property taxes. And even though they have the Sunrise Mall, we are actually ahead of Citrus Heights on sales tax revenue.)

What that seems to mean, is that when people talk about how good things are in the cities that have already formed in the County, they are not considering the fact that we won’t have as much money to spend.

The way I think about it, a 9% or 10% cushion is not that much when you are talking about a project of this size. I’ve built a couple of houses, and I know about budgets and overruns and unexpected stuff.

LAFCO says it’s doable, but it’s going to take careful management and there is not a lot of room for error. If it goes sideways, there’s not really much way the New City will be able to raise more funds (i.e., “raise taxes”), which means that there will need to be service cuts.

With that having been said, there is also a risk in sticking with the County. The County has to provide a broader range of services, and a lot of those are tied to State funding and State mandates. The New City “may be feasible” in maintaining our current and already diminished service levels, and it is less likely to be hit with some new funding problem created in the Capital.

This doesn’t mean that the New City will not be affected by what happens with the County. All kinds of quality of life issues depend on the County (starting with the Courts and the District Attorney), and if the County drowns, the New City will go with it. If they can’t afford to prosecute downtown, we are not going to get our crime and code enforcement benefits, and there will be costs.

I haven’t made up my mind on how to vote, but I am leaning towards a yes. After reading the LAFCO reports, I’m thinking that with the County we have a predictable and continuing expectation that things will get worse. With a New City, they may not. At least we can hold law enforcement spending steady, even if the challenges increase. Same thing goes for roads.

There are other things I see as potential problems with the New City. For that, I want to hear from the candidates. They are the ones who have stepped forward to say that they have studied the issues. I want to see the vision of those who plan to lead us.