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The other side of the Atherton election's profit/loss

Original post made by CPA, Atherton: Lindenwood, on Oct 24, 2012

Much has been made of the Atherton police officer union's endorsement of Cary Wiest and Elizabeth Lewis. The union obviously feels these are the two best candidates for the police officers in the upcoming negotiation regarding the police contract.

The police contract is the biggest part of Atherton's expenses. It's a huge issue.

But what about Atherton's revenues?

Since Atherton doesn't have businesses in town generating sales tax, it is severely hampered in terms of generating revenues to offset its expenses.

Atherton tried using a road impact fee. Real estate development is Atherton's largest industry, and a multi-billion dollar one. The developer on the finance committee makes millions on each house he develops (and continued doing so while on the finance committee).

But Elizabeth Lewis, who is in the commercial real estate business, and has been endorsed and received campaign contributions from real estate developers in addition to cops, made sure that road impact fee was rescinded.

She claimed it was illegal. She had help. At the time, Charles Marsala, also a darling of the Atherton developer community (and his garage cabinet company undoubtedly the recipient of work orders from them), was instrumental in defeating the road impact fee as well.

But if that's the case, that it's illegal, why does Los Altos Hills have it?

Guess what. Cary Wiest is also in the real estate industry.

These two candidates want to make sure Atherton taxpayers foot the largest possible bill they can, both in terms of giving the most to the cops (the largest expense), and favoring their real estate colleagues in terms of taking the least from them to offset these huge expenses.

Comments (6)

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Posted by Atherton Election
a resident of Atherton: other
on Oct 24, 2012 at 12:40 pm

Didn't McKeithen also vote to refund the Road Impact Fee. Dobbie opposed- right? What was McKeithe's motive?

Wasn't her motive the same as all the others-- the fee was excessive, not justified, and the town was caught doing an illegal activity of overcharging?

And with three votes WMD could have reinstated the fee in the last to years, why not?
It is probably illegal.

Or WMD could have even put it on the ballot for next month. Why didn't they?

Yes Los Altos Hills has one, but probably less than 30 cities in the state have them. Why not more?

LAH gets away with it because it charges much less than Atherton was charging. No one wants to spend the money challenging the smaller fee.

What we have is WMD don't want to work to renew Parcel Tax or get a Road Impact Fee tax passed by a full vote of the residents, but they do want to build a county Library in the park and they want the ability to raise other taxes without town votes.

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Posted by Atherton Election
a resident of Atherton: other
on Oct 24, 2012 at 1:10 pm

Did McKeithen cost Atherton a solid revenue source with the loss of the Road Impact Fee?

McKeithen voted to refund and terminate the Road Impact Fee, she has not tried to get in re-instated in the last two years, even though she has the votes of the WMD team.

What happened to the Road Impact Fee, Atherton had it for years and no-one complained. Around 2007 the Finance Committee, which McKeithen was senior member, recommended the council approve a 40% increase. By a 3-2 vote the council approved the increase.

At that point people complained. Suddenly the council gets rid of the whole thing and never tries to bring it back.

Maybe if the council voted no by a 3-2 vote, Atherton would still have the Road Impact fee.

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Posted by CPA
a resident of Atherton: Lindenwood
on Oct 24, 2012 at 2:04 pm

I guess you don't recall the 3-2 vote in which Carlson, Lewis and Marsala wanted to give a 100% refund to their developer friends, but McKeithen and Dobbie blocked that since a 2/3 vote was required. The city attorney, Wynne Furth, who was in the pocket of CLM, even said CLM could undo that 2/3rd requirement. But, before they could, an outcry of town residents developed, led by Mike McPherson, against CLM, and a reduced refund was granted.

This proves my point.

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Posted by Atherton election
a resident of Atherton: other
on Oct 24, 2012 at 2:55 pm

I take your point to be the Road Impact Fee is legal, based on the statement: "But if that's the case, that it's illegal, why does Los Altos Hills have it? "

My answer is less than 30 cities in CA have it. If it was legal, don't you think every city would have it. LAH gets away with it because it is much less than Atherton was charging after 2008 and people will pay a small fee rather than sue. Regardless if it is legal or not.

If the fee is legal, then why haven't WMD passed the fee the last two years? That is my point. The fee is probably illegal. For two years WMD have not passed any taxes or fee increases on real Estate or construction. You do not claim they are doing favors.

The reality is Atherton might still have the road impact fee, if it had not increased it by 40% shortly after it had to refund the Off-Haul fee and Business Liscense Tax increase. The goose that was laying silver eggs was killed.

Regarding the 3-2 vote.

The Road Impact Fee has been around for more than a decade. Lewis, Carlson, and Marsala did not want to refund the full decade.

When residents first came to the council it was in 2006 when the Off-Haul Fee which was put in place in was determined to be illegal. Lewis, Carlson, and Marsala felt the council had stalled action on refunding the fee and wanted to go back further in time than McKeithen and Dobbie.

The state only requires a city go back so far with refunds of illegal taxes one year.

That is an interesting way to run a city. From 2005-2007 the council put in place three illegal taxes or tax increases and had to issue refunds. But was able to keep more than a million dollars of illegally collected funds, because state law only requires a city to go back so far.

McKeithen and Dobbie felt comfortable keeping more of the illegally collected funds than did Lewis, Carlson, and Marsala.

McPherson had praise for Carlson's handling of the affair. Through Carlson's efforts a compromise was reached and lawsuits avoided.

In two years if the APOA endorses Widmer and Dobbie, will you claim it is for contract reasons?

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Posted by CPA
a resident of Atherton: Lindenwood
on Oct 24, 2012 at 2:59 pm

Haha, that's funny. Carlson voted to give it ALL BACK. It's ONLY WHEN public outcry started did Carlson change his tune.

The ONLY reason the full amount was not returned was because of Jim Dobbie and Kathy McKeithen.

And yes, if the APOA ever endorsed Jim Dobbie, Bill Widmer, Kathy McKeithen, and they accepted that endorsement, I would criticize them also.

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Posted by Atherton Election
a resident of Atherton: other
on Oct 24, 2012 at 3:25 pm

When did the Road Impact Fee go in place? Pre- 2000

How far did Carlson vote to go back at first? 2006? 2007?

That is not 100%.

There was an illegal tax, the council kept a large chunk of the money collected.

It then spent some of it in lawsuits and settlements.

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