The $420-million Question? Part 2.

Part 1 of the $420-million Question can be found on Badlands Journal on June 1. At that time, the City of Merced's new General Manager, Steve Carrigan, was likened to a Pit bull, drooling at the mouth to take a bite out of Merced County CEO, Jim Brown because the County was not rolling over for the combined wishes of UC Merced, landowners and the City to annex about 650 acres along the Bellevue Road approach to the UC campus.  Carrigan was only prevented from mauling Brown, so the urban narrative went, by the Chihuahua behind him, Assistant General Manager Mike Conway.
Perhaps they will mate and produce another Pithuahua to add to the city's pack of feral leftovers from the Great Bust.  
Let's get some things clear that are not being made clear by the City or the McClatchy Chain's local outlet. AMCAL Housing does nothing but affordable housing projects. It is ranked in the top 10 of affordable housing developers. This is not the same as being a top 10 developer. You will find that ranking at Professional
Builder magazine. This hyperbole "ranks" up there with the claim often made that UC Merced is the only UC campus in Central California.
What does it mean to be a top affordable housing developer?
To put it in the words of John Mourier, Roseville's largest local developer, "I love affordable housing projects. The developer cannot lose on them. Profits are guaranteed."
If developers are willing to sort their way through the paperwork involved, they can't lose on an affordable housing project because the state has a mandate to promote these projects and provides an array of financial incentives to do so through low interest loans and state and federal tax-credit programs designed to combat our constantly growing affordable housing crisis. AMCAL is a vertically integrated development/construction/management corporation that has been in the low-cost and affordable housing business for over 30 years.
Also, low interest loans from the University of California may also figure in this project, which targets the UC Merced students.
It should be noted that developers and investors sell the tax credits to raise capital for the projects.
So, $420 million of whose money for this guaranteed profit project?
A sense of civil horror rises in the gorge of people who went through the insane Boom-Bust cycle of the last 20 years when he listens to the uncivil growling and howling of 'Kid Stockton' Carrigan. We call him Kid Stockton because he is the former economic development director of Stockton, a city plundered and bankrupted by its developers and their friends in government. One wonders if Carrigan was picking up valuable tips on municipal administration at Fritz Grupe's Lodi ranch the day former representatives Richard Pombo, R-Tracy, and Dennis Cardoza, D-Merced, split $50,000 from a fundraiser in return for their promises to yet again try to gut the Endangered Species Act. Or was Carrigan learning valuable lessons from Monte McFall, a San Joaquin County fixer who served time in a federal penitentiary for charges arising from a scheme to corrupt the Port of Stockton? (The sheer improbability of such an endeavor led eventually to a shortening of McFall's  sentence. And just because he lived on the same ranch as the 1,000-plant marijuana operation busted last year didn't mean he knew anything about it.)
As 'Kid Stockton' Carrigan continues to blare out the figure, "$420 million," we might fail to notice that he is talking about a project on the corner of Bellevue and Lake roads. These parcels are not contiguous to the City of Merced, therefore cannot be annexed because that would be the very essence of leapfrog development, a bad thing in the minds of nice people. Therefore, those parcels will not be the only ones annexed. A chain of parcels, some owned by the Bandoni family, others by the Koligian family (nephews of the UC Regent who pushed hardest for the San Joaquin Valley campus), should also be annexed to make everything all legal and to greatly increase the value of their property.
We also note that the McClatchy Chain's outlets do not appear to be listening very clearly. If they had been, they would have heard County CEO Jim Brown say that nothing about this annexation had been written down as of June 7.
The usual coda: Fanfare from the Brass Section:
"The agreement will allow the city and county to bring jobs to the area," Carrigan said. "It will allow the opportunity to lower the poverty rate and unemployment rate, which are things we all want. It will help make Merced County a better place to live, work and play." Early Care and Education Consortium, June 3, 2016.
 And how many poor, unemployed people either here in Merced or from elsewhere are going to find work on this project. Most construction contractors and workers have left the area to find work elsewhere. But, no doubt, a vertically integrated affordable housing development corporation will bring its own workers and managers to the project.
'Kid Stockton' and his ilk in the economic development field throughout the nation all believe that housing development equals economic development. But what residents of Merced, Stanislaus and San Joaquin counties know is that a housing boom benefits finance, insurance and real estate special interests and that whatever paper crumbs they strew about them are all consumed in the inevitable bust.
North Merced will demand and receive more city services as Central Merced becomes the inner city slum. All it takes is quality public leadership like what we're getting with 'Kid Stockton.'
M erced Sun-Star
Developer nearly pulled plug on Merced

Lack of tax-sharing agreement caused frustration
$240 million project expected to move now that city, county in agreement

Other cities have complained they can’t complete deal with county in timely fashion
 Thaddeus Miller
A developer who plans to build apartments for thousands of people near UC Merced said he was close to pulling out before the city and county recently announced they’d reached a deal on tax-sharing terms.
The city of Merced has been working with Agoura Hills-based AMCAL Housing, which has plans for about $240 million in projects on three parcels of land across Lake Road from UC Merced. The apartments are to be built in four phases and the first part could be ready by fall 2018, according to CEO Percy Vaz.
“We were, in fact, getting ready to drop out,” he said. “So it was music to our ears when we heard that this revenue-sharing agreement was reached by the city and the county.”
The apartments should have been under construction a year ago, according to Vaz, but the developer was unable to do any work while Merced and Merced County leaders played tug-of-war over tax dollars that potentially could be generated in the area. The leaders agreed to tentative terms last week.
The city and county have been without a tax-sharing agreement since 2014, and city leaders said negotiations have been on and off for a decade. Without the agreement, the city cannot annex land and provide services such as sewer and water to the development.
AMCAL has experience in building housing for college students, Vaz said, and has complete or ongoing projects in Chico, Monterey, Turlock and Sacramento. But one thing he says the company has never seen is development held up by lack of a tax-sharing agreement.
“We never had this situation before, so we weren’t quite sure how to deal with it,” Vaz said. “There was a great deal of frustration because this deal was not getting concluded and was holding up just about everything.”
Other cities leaders, like those in Livingston, have complained that development is weighed down by long negotiations with the county. Los Banos was also waiting on an agreement,which it got this week.
Back in Merced, other developers have plans for retail, research and other space near the university. Vaz said the university’s needs and the interest from other developers gives the company confidence that the apartments will be successful.
The Merced projects would offer space for about 2,400 beds, aimed at students. While tenants would have private bedroom and bathroom areas, the apartments have common living, dining and study spaces.
UC Merced has about 2,100 beds on campus, according to spokeswoman Brenda Ortiz. The 2020 Project, which will double the size of the campus, is expected to add enough space to bring the number of students living on campus to about 4,060.
Leaders have said they do not expect to have room for all students, which means they could spill over into the new apartments.
City Manager Steve Carrigan has expressed a sense of relief that the negotiations seem to be a thing of the past. “We’re very fortunate to have a top 10 builder in the country here building their product in Merced County,” he said. “AMCAL’s a first-class organization. We’re not going to hold them up.”
Not all of the kinks have been worked out, but the city and county have tentatively agreed on terms. The Merced County Board of Supervisors directed staff on Tuesday to move forward in drafting the tax-sharing agreement with the city, but are also including a backup plan.

Early Care and Education Consortium
City of Merced, county agree on tax-sharing approach;jsessionid=1wq6smkypnd8...
June 02--The city of Merced and Merced County have reached a tentative agreement on a potentially historic deal that would pave the way for $420 million in future construction projects near UC Merced, the Merced city manager confirmed Thursday.
The revenue-sharing deal, more than a decade in the making, was described by City Manager Steve Carrigan as "win-win" for the city and the county.
Reaching agreement on how the two bodies will divvy up tax revenue is crucial for the city of Merced to jump-start development in the Bellevue corridor near UC Merced. Much of the land around the campus is outside of city boundaries and the city cannot provide services such as police, fire and recreation until it annexes the area, a step that cannot win state approval without the revenue-sharing agreement in place.
The city has a developer waiting to build about 1,000 apartment units in the area and now is ready to greenlight the development as soon as the revenue-sharing agreement is approved, Carrigan said.
"The agreement will allow the city and county to bring jobs to the area," Carrigan said. "It will allow the opportunity to lower the poverty rate and unemployment rate, which are things we all want. It will help make Merced County a better place to live, work and play."
Under the tentative agreement, funding to support firefighting would be shifted to the city. All general fund taxes would go to the city, but after a required allotment of money is directed to a state education fund, the city would keep 37 percent of leftover tax revenue while sending 63 percent to the county.
Overall, the city stands to collect about 53 percent of taxes and the county will collect 47 percent, said Mike Conway, a spokesman for the city.
County CEO Jim Brown cautioned that elected officials for the city and county have the final say on whether to pursue the new approach to a deal.
The Merced County Board of Supervisors and Merced City Council will discuss the tentative deal at their respective meetings next week. Both sides still must vote to formally approve the agreement.
"At this point, it's a good direction and we need to bring the concept to the board to see if it's something they are interested in moving forward with," Brown said.
Brown said the approach is new and will need to be approached cautiously. "There are some risks to the county," he said, "We do need to make sure we minimize those risks through discussions on how to implement it and the language that is put together."
The deal is the first new revenue-sharing agreement between the city and county in 10 years. In the middle of 2015, the two sides began more consistent, but frequently contentious, negotiations. Bargaining appeared to break down many times during the decade-long process. The Merced City Council in May sought a third-party mediator to break the gridlock, saying the critical deal had been stalled too long.
Two meetings this week and many conversations between Carrigan and Brown finally produced the tentative agreement, the city manager said.
"We have made significant progress the last couple days," Brown said. "We have both compromised in trying to put something together that we think works overall for both the city and county."
Carrigan said the city and county still are massaging language details.
"In most negotiations, when you get to the finish line and have a good deal, both parties compromised and walk away angry," Carrigan said. "In this case, I think the county got what they wanted and the city got what we needed."
California State Treasurer's Office
Treasurer’s Program Approves $466 Million in Affordable Housing Financing
Tax credits will help build 37 projects with 2,162 units of housing with below-market rents
Contact: Marc Lifsher
SACRAMENTO – As California lawmakers and governor search for a plan to confront the state’s massive shortage of affordable housing, the State Treasurer’s Office is making steady progress with its own program to finance the construction of thousands of safe, comfortable, below-market-rent apartments.
On Wednesday, the California Tax Credit Allocation Committee (CTCAC), chaired by Treasurer John Chiang, approved the issuance of $466 million worth of competitive federal and state tax credits that will help pay for the construction or rehabilitation of 37 affordable housing projects with 2,162 units. At the same time, CTCAC awarded non-competitive tax credits to finance an additional 850 new or rehabilitated housing units statewide.
Developers can sell the tax credits to raise money to allow them to offer lower rents for tenants, who earn between 30% and 60% of the local annual median income. The Allocation Committee issues nearly half a billion dollars in tax credits twice a year after evaluating developers’ applications in a competitive selection process.
“We are proud to support the creation of over 2,000 units of very affordable housing that gives families, seniors and homeless persons safe and stable places to call home,” said State Treasurer John Chiang. “The Treasury’s housing programs are a model for how to efficiently fund and build new units in a state facing a 1.5 million-unit shortfall in low-cost, rental units,” he said.
Among the winners of the latest round of tax credits awards are:

  • Morgan Hill Family in Morgan Hill, Santa Clara County, 40 units in scattered sites for large families.
  • Courson Arts Colony East in Palmdale, Los Angeles County, 80 units serving large families and artists’ live-work space.
  • Roland Curtis East, Los Angeles, 69 units serving large families.
  • Fullerton Heights, Fullerton, Orange County, 36 units, including housing for the homeless.

The Allocation Committee’s tax credits are “absolutely critical” for building affordable housing, said Dave Egan, area director of real estate development for EAH Inc., which is developing the Morgan Hill project.
“Many of these projects would not get financed without the existence of federal tax credits being sold to investors to generate the equity needed to build these homes,” he said. “Tax credits provide consistency for financing affordable projects.”
Efforts by the Allocation Committee and a sister housing agency, the California Debt Limit Allocation Committee, are the basic “building blocks of how almost all affordable housing in California is financed these days,” said Mark Stivers, executive director of the California Tax Credit Allocation Committee.
“We’re doing everything we can to put more roofs over people’s heads.”
For more news, please follow the Treasurer on Twitter at @CalTreasurer, and on Facebook at California State Treasurer's Office.
Come on Down to Pombozastan!
Members of the San Joaquin Valley public would like to invite you to the first annual UC Pombozastan Pot Luck.
We’ve got the barrel; you bring the pork.
Public/private partnerships get preferential picnic tables behind gated, straw-bale walls, just like they did it at the old-time Condit Country extravaganzas.
The Valley public would like to invite you all to Merced to help us get this UC Merced 900-acre expansion past them damn federal environmental regulators. Our largest developer, the University of California Board of Regents, is having trouble getting a pesky little Clean Water Act permit out of the Army Corps of Engineers so they can build on land in a ESA designated critical habitat area containing the richest fields in the state of vernal pools, environment for 15 endangered species of flora and fauna, for which one cannot help but think a responsible, institution of public higher education would have secured a permit before commencing construction. The UC Regents are not supposed to be typical California fly-by-night developers.
But, who cares?
COME ON DOWN! Bring the People’s Money, we’ll run it through UC and it will pick up your tab. Stay anywhere, pay as much as you want for breakfast, lunch and dinner, rent only the most expensive cars — if you need further instructions we can refer you to UC consultants, who can teach you also how to add that absolutely mandatory 10-20 percent on every expense chit.
COME ON DOWN and see UC Merced, which the last state Senate Pro Tem called the “biggest boondoggle ever.”
“I don’t know why anyone would be surprised,” said Patrick Callan, president of the nonprofit National Center for Public Policy and Higher Education. “It was just the wrong campus in the wrong place at the wrong time. It was pork-barrel politics and institutional arrogance that led us to this. There was a belief at UC that you could just hang a UC shingle out and that would attract students.”
And, hey, be sure to bring the People’s Money with you, because UC Merced wants all of it. UC’s talented team of tax-paid flacks and lobbyists can give you all the details. The effort will no doubt be headed by Rep. Dennis Cardoza, Shrimp Slayer –Merced Division. Surely, you know the Shrimp Slayer – he’s the guy who’s making Rep. RichPAC Pombo, Buffalo Slayer-Tracy’s war against the Endangered Species Act “bipartisan,” on behalf of a few developers, large landowners, financial institutions and realtors in their adjoining districts.
Down here we started calling them the “Pomboza” soon after they strolled arm-and-arm out of a little fundraiser at San Joaquin County developer Fritz Grupe’s ranch and split $50,000 in what Cardoza called an act of “aggressive cooperation.” It may not have been accidental that a few months later the Pomboza co-authored what is known in environmental circles as the Gut-the-ESA bill, now languishing in the Senate. What Cardoza calls aggressive cooperation, we call the Pombozation of the San Joaquin Valley.
COME ON DOWN TO POMBOZASTAN and watch Pombo and Cardoza pombozate the West’s federal resource agencies.
COME ON DOWN and bring us the People’s Money. We don’t have enough of it. You’ve no doubt read the Congressional report about how the San Joaquin Valley is poorer in some ways than Appalachia. We appreciate our subsidized water, our subsidized cotton, dairy and cattle industries, and all the health and human services aid you’ve been sending. But we need more of it, more and more and more of it. We can’t make it without more and more of the People’s Money down here in Pombozastan, the former San Joaquin Valley. And if we don’t get it, we’re going to pave over the largest, richest agricultural valley in the West.
So there!
Listen to the UC Merced Chancellor (until she quits at the end of the month)! We need a UC Merced research medical school down here to specialize in respiratory illnesses, cancer clusters, pesticide-related diseases, diseases related to contaminated ground water, drug addictions, rural mental illnesses and disorders arising from bovine flatulence here in the epicenter of the dairy industry in the nation’s top dairy state. Until recently, under the Bush administration, the fortunes of this industry were jealously guarded by Modesto’s own USDA secretary, Annie Veneman. Pledge the People’s Money to build out UC Merced, which will stimulate a tremendous amount of growth because it will be the anchor tenant for development down the east side of the Valley from Sacramento to Kern counties along a planned eastside Highway 65 and an Eastside Canal.
COME ON DOWN TO POMBOZASTAN and help replace Valley life with mega-dairy subdivisions-in-waiting and slurbocracy. And while you’re at it, explain why you’re doing it, because we really don’t know and the Pomboza won’t tell. Nevertheless, Cardoza provides thoughtful continuity for the slurbocracy from his top floor offices in the Merced County Administration Building.
COME ON DOWN! We know this all sounds a little grim, but we want to assure you that the Valley is a really funny place. We’ve got comedians galore here in Merced. Consider the UC Chancellor Until the End of the Month, Carol Tomlinson-Keasey, for example. She had the whole Valley rolling on the floor in helpless mirth this week when she told the McClatchy chain reporter:
“I needed to make (congressmen) aware that this is the beginning of the process,” Tomlinson-Keasey said. “People speak out all the time and say their opinion, (but) I have talked with the Corps, and they have assured me they will play by the rules.”
Choking back life-threatening guffaws, members of the public asked: “What rules could she possibly be talking about?”
Surely, she could not be talking about local, state or federal environmental law and regulation. Beyond urging the Pomboza onward to alter it to suit UC’s needs in eastern Merced County, she has no tolerance for it.
Surely, she could not be talking about the rules of good taste, whose university campus sponsors a yearly Fairy Shrimp Festival, hosted in its inaugural year by the son of a recently ousted provost.
Surely, she could not be talking about those rules of candor said to govern testimony before legislative committees.
Surely, she could not be talking about regulations governing the rehabilitation of wildlife, when she purloined a bobcat for the UC Merced mascot that should have been rehabilitated and released back into the wild.
Surely, she must be speaking about the UC RULE: UC is sovereign and gets what it wants.
Another great Merced comedian is the businessman Mr. UC Merced, Bob Carpenter, who appeared in the pages of the Los Angeles Times recently.
So why didn’t the university secure permission to build the entire campus before beginning work? “It’s easy to criticize after the fact,” said Bob Carpenter, a Merced resident who has helped with university planning for 18 years. “But you could argue that if you wait until all the I’s are dotted and all the Ts are crossed, probably no projects would ever get done.”
But then, the chancellor, not to be trumped in the comedy game by a mere UC Merced booster, even if Carpenter could be called, justly, The UC Merced Booster, got the last word:
“We’re contributing enormously to the community. We believe we deserve an Olympic gold medal, and not have every bump being foreseen as some Mt. Everest to climb.”
An Olympic gold medal, some would say, requires a sports team of some sort. The UCM Golden Bobcats are undefeated so far, but they remain in smoky backrooms rather than taking the field in any sport in which they would have to play by any rules other than their own.
UC built the first phase of the Merced campus without getting a Clean Water Act permit. They spent millions in state funds on conservation easements to mitigate for wetlands habitat, as the result of backroom deals in the state Capitol between the governor, congressmen, state legislators vying to see who was the Biggest Mr. UC Merced of them all, state and federal resource agency officials, The Nature Conservancy, the Audubon Society and other prominent state and national level environmental sluts.
Yet, today, when federal agencies look at these easements, they discover many of them aren’t on the right land and have no financial mechanism for monitoring. In some cases, landowners are under the impression they can take millions in public funds for easements yet refuse to let resource officials on the land to observe the condition of the natural habitat.
The chancellor has announced she plans to take a year off to write a book about the founding of UC Merced, before returning to teaching. However, some speculate that in the current crisis she will continue at the helm as Chief Bobcat Lobbyist. Historians will probably prefer legal briefs on the project to pure Bobcat flak anyway.
COME ON DOWN! The pombozated federal resource agencies are holding a raffle on our remaining natural resources, wildlife habitat and wetlands – piece by fragmented piece.
COME ON DOWN TO POMBOZASTAN! Watch the Developer Dutch Auction on San Joaquin Valley land-use planning.
COME ON DOWN! Watch the sales-tax increase sweepstakes so that the Valley can match funds with the federal government on new freeways, highways and loop roads to stimulate even more growth, as the rural county roads crumble before your eyes. Come on down and watch them fill the potholes in front of the Merced County Association of Governments office!
COME ON DOWN and learn the mystical process of making plans to make plans to make plans to make plans and get public funds to do it.
COME ON DOWN and listen to some whoppers about the Merced County water supply plan, which ain’t, but they all say it is.
COME ON DOWN TO POMBOZASTAN and observe, first hand, the latest design in up-scale yuppie labor camps – zero lot lines, no yards, parks and play areas closer to the freeway than to the home. Watch childhood asthma develop before your very eyes as you are stalled in freeway traffic.
COME ON DOWN and join the fun, if you want to play by the rules UC, the Pomboza, the developers and our wise, far-seeing local governments make up as they go along for the benefit of themselves and their families.
COME ON DOWN! Maybe you can be an early student in UC Merced’s Coelho Institute of Honest Graft (and public policy), or the McClatchy/Singleton School of Conglomerate Media Management, or study the nanotechnology of nuclear weapons triggers. If you’re lucky and everything goes right, you might get a joint appointment with UC Lawrence Livermore National Laboratory to study Ebola and Anthrax in a genuine safety level 4 biowarfare lab.
We got the barrel; you bring the pork.
BILL HATCH is a member of the Badlands Journal editorial staff, a San Joaquin Valley-wide group that publishes news and commentary on Valley issues at
AMCAL has developed quality housing throughout California since 1978.
In recent years, AMCAL has focused on the affordable housing sector, including family and senior apartments. Inclusionary housing that provides the affordable housing for master plans in Orange County and the San Francisco Bay area also are being developed. New for-sale workforce housing is being built at infill locations in emerging urban neighborhoods.
During the past several years, AMCAL has developed, or is currently in the planning process of building and developing 4,827 affordable rental and for-sale units. The new housing is located throughout California, including Santa Barbara County, Simi Valley, Pomona, Victorville, Coachella, Rancho Palos Verdes, Palmdale, Oakland, Sacramento, San Diego, the San Joaquin Valley, the Bay Area, and numerous urban revitalization projects in central Los Angeles and the San Fernando Valley.
The value of AMCAL housing completed or under construction exceeds $1,000,000,000. Financing is based on allocations of Low-Income Housing Tax Credits, local public agency funding, and traditional institutional equity and bank loans. Since 1995, AMCAL has been awarded among the highest allocations of state and federal tax credits in California, valued at $631,351.453.
Strong financial institutions are impressed by AMCAL’s competence and regularly partner on for-sale and rental product, including Bank of America, Chase, Union Bank, Raymond James, Hudson Housing Capital, SunAmerica Affordable Housing Partners, Genesis Workforce Housing Fund (Phoenix Realty Group), Wells Fargo, Citibank Community Development, California Bank and Trust, John Hancock Life Insurance and Verizon Capital.
Award-winning architects are partners at the earliest stages of planning, including Withee Malcolm, MVE, William Hezmalhalch, Van Tilburg, Banvard and Soderbergh, Newman Garrison Gilmour + Partners and KTGY Group. Design excellence and sustainable/green elements are incorporated into every community, and AMCAL has won numerous awards for its rental and for-sale products.
Award-winning housing includes Mirandela apartments, which was honored by the BIA as the best senior housing in southern California in 2011. The Royale apartments in Westminster and Avenida Villas in Anaheim were honored as Projects of the Year in Orange County by the Kennedy Commission. Multifamily Executive magazine selected two San Diego brownfield developments, Los Vientos and Mission, as “Project of the Year – Best Re-use of Land.” In 2007, the “Avenue 26 Master Plan” with 534 units of workforce condominiums and affordable apartments won Multifamily Executive magazine’s “Editors Choice – Project of the Year” award and the NAHB’s “Innovation in Workforce Housing” award.
The Castelar Apartments in Chinatown was named a “Best of Downtown” new affordable development in 2004. Positano in Santa Barbara won the National Association of Housing and Redevelopment Officials Award, and Canyon Cove for sale development in Oak Park won several Elan Awards in the 1990s.
AMCAL’s affordable developments offer amenities similar to market-rate projects. Computer centers, job skills training, childcare, English language lessons and senior services are available at most new communities.
AMCAL is vertically integrated with acquisition, development, finance, asset management, and construction departments, which results in efficiencies and cost savings. From land acquisition to design, to the coordination with municipalities and final construction, AMCAL communities always look and feel like market-rate developments.
Quality is built in, and with AMCAL, ‘affordable’ never means less.