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It has been an amazing honor to serve the residents of Orange County as their Treasurer-Tax Collector, to serve the former Second District as their County Supervisor, and to serve the former 37th Senate District as their State Senator. And as a candidate for Mayor, it was a privilege to walk neighborhoods, meet with friends, view old haunts, and reflect on my 46 years of involvement in Costa Mesa.
It was an honor to run for Mayor. I want to thank all my donors, walkers, callers and yard sign displayers. Nearly half of those who voted wanted a change. And with good reason.
Twenty-eight years ago, the Federal Reserve Board raised interest rates by 75 basis points. Before this occurred, I warned that if the tightening of interest rates continued, it would have a major impact on Orange County. It did. It filed for the largest Chapter 9 bankruptcy in U.S. history at that time.
Watching the Federal Reserve Board tighten interest rates by 75 basis points again this year made me worry as to what will break in this economic cycle? Will it be CalPERS, which lost 7.5 percent in its last fiscal year ended June 30, 2022? Will it cascade to cities, with the demand of larger annual required contributions, thus crowding out other necessary expenditures during an already difficult inflationary environment? Combined with a recession, what will our unsuspecting city council majority do since it has taken Costa Mesa to the bottom of fiscal wellness listings in ten short years?
Seeing that Costa Mesa has the largest unrestricted net deficit per resident in Orange County is very disconcerting. Having the California State Auditor chastise Costa Mesa for being 26th from the bottom as one of the worst fiscally managed California cities is embarrassing. Especially when the state has 482 cities.
As someone who started his career as a Certified Public Accountant and Certified Financial Planner, I wanted to bring my skill sets and experience to turn my city’s finances around. That’s why I ran for Mayor in the November General Election. I fear for the upcoming fiscal train wreck on the horizon for my city and wanted to do something about it.
Costa Mesa voters did not see the need for a fiscal reality check. Consequently, I called John Stephens the afternoon of November 18 to concede and congratulate him on his election as Mayor. With two tough years ahead, I wish him the best.
The highly regarded State Legislative Analyst’s Office, which I worked with while serving in the State Senate, is already predicting a $25 billion deficit for the state of California. Rough economic times are being felt at every level. Costa Mesa will not be immune, as it has not reduced massive unfunded liabilities.
Sadly, the only ones that do not seem to be aware of these economic reverberations are Costa Mesa’s appointed incumbent Mayor and the City Council majority. I wish them all the best as they navigate through the down cycle and hope their only solution is not to simply raise the sales tax rate or city fees.
