An open financial wound of unknown consequence

The north San Joaquin Valley has gained another first. No doubt, Modesto-based UC/Great Valley Center is ecstatic to see that its "smart growth" agenda has been so hugely successful. Our area is now the nation's leader in mortgage foreclosures as the San Joaquin Valley bids to surpass Los Angeles as the worst air pollution region in the nation. The north San Joaquin Valley is now a suppurating financial wound for finance, insurance and real estate special interests. Who knows how far the infection will spread?

Our region was so convulsed by greed in a speculative housing boom that the Pomboza (representatives Dennis Cardoza, Shrimp Slayer-Merced and former Rep. RichPAC Pombo, Buffalo Slayer-Tracy), backed by cash raised by Fritz Grupe, Stockton's preeminent developer and the active co-chair of the California Partnership for the San Joaquin Valley, were determined to break the back of the Endangered Species Act in order to build out on all those seasonal pastures that provide the existing residents of the Valley with their watersheds and what clean air still exists.

Who do you blame?

Let's start with who you can't quite blame. You can't blame a realtor for doing her job. You can't blame a mortgage lender for selling another subprime mortgage, and you can't blame a family for getting in on the American Dream of Home Ownership even if they can't pay for it or understand the mortgage that enables it. You cannot blame the Silicon Valley retirees for taking the advice of their financial consultants to roll over their 401Ks in the hottest real estate market in America. You'd be unwise to blame the flippers, because, hey, there was a market that encouraged flipping.

But, you can blame government that is supposed to look out for the common good, despite the cynical claim that the concept of the common good no longer exists. If the government doesn't look out for the common good, the common people are going to have to rise again, somehow, in a disciplined political movement intent on one aim: Throwing the bums out.

Government in Merced County cannot deny it was told. It cannot deny that critical, well informed, citizens spoke in public hearings on development for the last eight years, starting with UC Merced, the anchor tenant for this whole real estate feeding frenzy that has ended as a national disgrace to American financial prudence. Government, local land-use authorities, and only local land-use authorities, had the duty and the power to resist this obscene greed fest. And the governance of elected officials at the federal, state and local levels abdicated the dignity of their offices and enabled the addiction to real estate speculation that has produced this.

Local land-use authorities cannot deny that they have been presented documents filled with substantial arguments against the path they took. They cannot deny they have been sued by their own public on numerous occasions -- and sued more often successfully than not -- on these issues. Elected officials of local land-use authorities have been well and fully warned of the consequences of their decisions.

But, these warnings were delivered largely by environmentalists. Due to their psychotic hatred for environmentalists, elected officials did not listen, could not hear, other warnings. Finance, insurance and real estate special interests charged forward, enthused with their own mythology, and government rolled over, sold out and abdicated its regulatory function. A land-use authority is supposed to regulate land use. These bums opened the doors to a frenzy of speculation.

We aren't talking about a lack of wisdom here. We are talking about a lack of the most elemental common sense.

Below, find one of our more recent cautionary letters to the Merced County Board of Supervisors. Below the letter, you will find the latest report on the shameful irresponsibility of government in San Joaquin, Stanislaus and Merced counties, all lying within the district of Cardoza, the rear end of the Pomboza. Now that Pombo has become a lobbyist in Cardoza's district, no one can say the Pomboza is dead. Electoral defeat has only encouraged the beast.

Reckless, wholesale destruction of natural resources, at least in the San Joaquin Valley, is a recipe for financial destruction as well. John Muir's refrain haunts the boardrooms: "All things hang together."

Badlands editorial board
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To: Opponents of the Riverside Motorsports Park
From: Central Valley Safe Environment Network
Date: Nov. 10, 2006
Re: Join us in calling for a moratorium on projects like RMP, Wal-Mart, the UC Community Plan, the UC Parkway and other growth, destructive to agriculture, communities and the environment, until Merced County has fully and legally updated its General Plan.
Calling for a moratorium on growth is a drastic step. However, we ask you to join the 16 groups that have already called for it, for the following reasons:
· Merced County has been amending its General Plan, approved before UC Merced was conceived, to make way for every project developers, County planning commissioners and the Board of Supervisors desire. Although there is an update process working now, despite a public call to halt development until the process was completed three of the largest, highest impact projects will receive county approval before a new general plan is in place – RMP, Wal-Mart, the UC Community Plan, and the UC Parkway and others.
· Meanwhile, a mile-long, 42-inch sewer trunk line heading south out of Livingston, lies buried, uninspected and unpermitted in County jurisdiction awaiting subdivisions on prime farmland to serve.
· Meanwhile, thousands of acres of seasonal pasture containing federally listed endangered species have been deep-ripped without any permits and put into orchards and vineyards to hold for future subdivisions.
· Meanwhile, cities and communities update their general plans, expand their sewers and spheres of influence without reference to a coherent county General Plan.
· Meanwhile, the Merced County Association of Governments – despite its third defeat in trying to get residents to hike their sales taxes to pay for more growth-inducing roads – goes on furiously planning more roads.
· Meanwhile, by the ceaseless political meddling of the Great Valley Center in partnership with UC Merced, there is a whole parallel state planning drive, called variously the San Joaquin Valley Partnership and/or Blueprint.
· Meanwhile, the San Joaquin Valley air basin continues to be in severe non-attainment of its quality goals and is today the worst air-polluted farming area in America.
· Meanwhile, our officials ceaselessly blabber about the “inevitability of growth.”

Special interests are in the process of creating a planning map for Merced County created out of continual overlays. The purpose is to create a GIS planning map from Hell to provide a perpetual motion machine of non-accountability for the growth of slurb.
So, why not try something new and comprehensible: Just say NO to more growth until our leaders produce a fully legally compliant county General Plan to guide future growth in Merced County?
Central Valley Safe Environment Network

Coalition Statement on Merced County Planning Process

We call for a moratorium on County General Plan amendments, variances, minor sub-divisions changes to existing projects, zoning changes, and annexations of unincorporated county land by municipal jurisdictions, MOU’s and developments with private interests and state agencies, until a new County General Plan is formulated by a fully authorized public process – and approved locally and by the appropriate state and federal agencies.
The continual process of piecemealing development through amendments, willfully ignoring the cumulative impacts to infrastructure and resources, for the benefit of a small cabal of public and private special interests, is illegal and reprehensible conduct on the by elected and appointed officials of local land-use authorities.
We also call for a permanent moratorium on indemnification of all local land-use jurisdictions by private and public-funded developers.
Indemnification is the widespread, corrupt practice in which developers agree to pay for all legal costs arising from lawsuits that may be brought against their projects approved by the land-use authority — city or county. Without having to answer to the public for the financial consequences of decisions made on behalf of special interests, local land-use authorities can be counted on to continue unimpeded their real policy: unmitigated sprawl, agricultural land and natural resource destruction, constant increases in utility rates, layering of school and transportation bonds on top of property taxes, and the steady erosion of the county’s infrastructure.

Adopted 2006

San Joaquin Raptor/Wildlife Rescue Center
Protect Our Water
Central Valley Safe Environment Network
Merced River Valley Association
Planada Association
Le Grand Association
Communities for Land, Air & Water
Planada Community Development Co.
Central Valley Food & Farmland Coalition
Merced Group of Sierra Club
Citizens Committee to Complete the Refuge
VernalPools.Org
California Native Plant Society
Stevinson Citizen’s Group
San Bruno Mountain Watch
San Joaquin Valley Chapter of Community Alliance with Family Farmers

CENTRAL VALLEY SAFE ENVIRONMENT NETWORK
MISSION STATEMENT

Central Valley Safe Environment Network is a coalition of organizations and individuals throughout the San Joaquin Valley that is committed to the concept of “Eco-Justice” — the ecological defense of the natural resources and the people. To that end it is committed to the stewardship, and protection of the resources of the greater San Joaquin Valley, including air and water quality, the preservation of agricultural land, and the protection of wildlife and its habitat. In serving as a community resource and being action-oriented, CVSEN desires to continue to assure there will be a safe food chain, efficient use of natural resources and a healthy environment. CVSEN is also committed to public education regarding these various issues and it is committed to ensuring governmental compliance with federal and state law. CVSEN is composed of farmers, ranchers, city dwellers, environmentalists, ethnic, political, and religious groups, and other stakeholders.
P.O. Box 64, Merced, CA 95341

6-13-07
Modesto Bee
Foreclosures: Valley leads nation
By J.N. SBRANTI
http://www.modbee.com/local/v-dp_morning/story/13684201p-14274141c.html

We're worst in the nation. That's what home mortgage foreclosure statistics reveal for the Northern San Joaquin Valley.
The region's foreclosure rates were nearly seven times higher than the national average in May, according to data gathered by RealtyTrac.

San Joaquin County had the highest percentage of properties in default on their mortgages. Merced County was second-highest. Stanislaus County was third.

"I'm surprised at how high your foreclosure numbers are. They've really jumped," said Daren Blomquist, spokesman for RealtyTrac, which publishes a national database of properties facing foreclosure. "You've got an exponential increase."

That's for sure.

Just two years ago, foreclosures in the valley were virtually unheard of. Now they're a daily occurrence.

For example: In Stanislaus County during May 2005 there were just 78foreclosure filings, most of which were notices of default, which is the first step in the process. This May, those filings skyrocketed to 1,278. That's more than 16 times higher than two years ago.

Merced County foreclosure filings are a whopping 31 times higher, rising from 22 two years ago to 688 last month.

San Joaquin County filings are 18 times higher, rising from 120 to 2,157.

By comparison, nationwide foreclosure filings are 2.4 times higher than two years ago.

The vast majority of homeowners who enter the foreclosure process traditionally have been able to get out of it without losing everything. They could refinance their mortgages or sell their homes before the bank took over.

That's no longer the case. Statistics from RealtyTrac show massive jumps in the number of homes being repossessed by lenders.

"People have gotten into home mortgages that stretch them too thin," Blomquist said. "They were anticipating home values continuing to go up, so they could bail themselves out by selling or refinancing. But the market is not cooperating now."

Homeowners these days often owe more than their homes are worth, so there's no easy way to escape their mortgage burden. As a result, increasing numbers of homeowners who fall behind on payments are having their homes taken over by lenders.

Last month in Stanislaus County, 162 homes were repossessed. In May 2006, no homes were lost that way.

Lenders have taken over so many homes, in fact, that they're flooding the resale housing market with so-called distressed properties.

Forty-seven of those lender-owned homes will be put up for auction June 25 in Modesto, with starting bids as low as $89,000. That auction, by the Real Estate Disposition Corp., has many starting prices at less than half the home's previous value.

"Those auctions are an indication that lenders are more desperate to get rid of those (repossessed) homes," Blomquist said. He said buyers are getting harder to find. "A lot of investors are very gun-shy about getting into this market right now."

Homeowners are having a hard time finding any kind of buyer.

Only 774 homes have been sold in Modesto this year compared with 1,548 at the same time last year, according to the Central Valley Association of Realtors.

New home sales also have plummeted. In Stanislaus County, only 82 new houses sold this April compared with 212 in April 2006, according to the California Building Industry Association.

And home values continue to fall.

The Realtors association reports that the median-priced Modesto home sold for $325,000. That's $18,000 less than at this time last year.

In Stanislaus County, new homes in April sold for a base price of $429,990, which was $16,000 less than last year, the building association reported.

Another sign of the real estate market's troubles is the rising rate of delinquent property taxes.

In Stanislaus County, nearly 7.7 percent of landowners have yet to pay their 2006-2007 property taxes, which were due in April. Tax Collector Gordon Ford said that delinquency rate is on track to set a record.

Many of the region's real estate woes are expected to be discussed today at the Valley Real Estate & Economics Conference at the DoubleTree Hotel in Modesto.

That conference will include sessions on what's ahead for the region's real estate market and investment opportunities. The event starts at 7:30 a.m.; tickets are $50 at the door.

staff writer J.N. Sbranti can be reached at jnsbranti@modbee.com or 578-2196.