Proposition 64 legalizing pot is not that big a deal

Smoking marihuana is more fun than drinking beer, But a friend of ours was captured and they gave him thirty years. Phil Ochs from Small Circle of Friends  just-say-no

I should be more excited about Proposition 64 which if passed will legalize the recreational consumption of marijuana in California. After all, as an individual who grew up in San Francisco close to the Haight Ashbury, I have been a user of this substance for most of my life since experimenting with the stuff as a teenager.

Currently for me, making it OK to legally smoke a joint should be a big deal; but it isn’t. It appears that I am suffering from a strange case of “Reefer Madness” In this case apathy seems to be a more appropriate sentiment. I just don’t care.

How could such a condition exist for an individual who has been an avid consumer of pot even before my foray into the counter-culture while attending college at UC Santa Barbara and living in Isla Vista? Has smoking weed for so long finally turned my mind to mush to such an extent that it has destroyed my brain into a permanent state of station identification?

I don’t think so. It is still possible for me to conduct business and write articles which make sense to some folks. However, these activities are best done straight under the influence of nothing stronger than coffee. I learned a long time ago that wine and/or weed are not a creative force for a matter of any substance. On the other hand consuming moderate amounts of alcohol and marijuana can be a pleasurable pastime when not on the clock.

With this being the case why does Proposition 64 not excite me? Perhaps the reason for this is that one of the greatest allures of smoking pot is that it is illegal. Such a “we versus them” mentality was an important component of the counter culture generation in the 1960’s and 70’s.

Going along with the loss of all the paranoia associated with being as a doper is the concern that by legalizing weed, the outcome will not be satisfactory. There is a haunting suspicion with my generation that if the government gets involved with marijuana distribution, they will screw the process up like has been done with virtually everything else they have tried to regulate.

Not even taking into account warning labels, disclaimers, packaging requirements, calorie counts for edibles, and formulating THC percentages, we can count on the “do gooders” in Sacramento to eventually reduce the quality of cannabis to save consumers from themselves.cheech-and-chong-parked-meme

And let’s not forget controversies which will inevitably ensue when some expert concludes pot causes cancer for labratory mice that eat triple the amount of cheese they would ordinarily consume. There will be so many studies done that an extra 10 cents per gram will be needed just to fund research grants. People like me who have been under the influence for years will become valuable guinea pigs for studies on long term effects of cannabis use providing we can remember to show up for meetings.

There are also likely legal issues that would come up should marijuana become regulated by the government. Using the same logic as the anti firearms lobby utilizes to make gun makers such as Smith & Wesson responsible for crimes committed with their weapons; we can expect similar suits against weed purveyors.

I can just see the defrocked American’s with Disabilities attorney’s suing the makers of Cheetos for millions of dollars claiming that this product caused poisoning for their midnight munchies challenged clients. Baskin Robbins might find themselves on the defensive should a consumer of what Alice B Toklas distributed O.D. on massive amounts of Pralines and Cream. Who would pay if a recreational marijuana user needs to attend a 12 step Jack in the Box avoidance program?reefer-maddness

Even then, as things stand consuming marijuana still violates Federal laws. Theoretically, emissaries from Washington D.C. can crash the party at any time and arrest all who are involved with pot sales. Likely, this same type of stalemate will continue until the Feds changes their stance. Unfortunately, there are just too many individuals in our puritanesque culture to allow for the legalization of marijuana to be the law of the entire land.

The biggest issue that various agencies in government from local communities to Washington D.C. are trying to deal with is whether marijuana and its derivatives as a class #1 drug have legitimate medical uses. Those in favor claim that ingestion of THC assists the appetites of cancer patients undergoing chemo therapy or treatment for anorexia. It has many other applications including providing assistance for sleeping and providing pain management for those with chronic arthritis.

On the other hand under the present system in California recreational users of pot can be granted a user card approved by a so called doctor for any imaginable reason varying from I hate my mother-in-law to claiming depression because their regular dope dealer is on vacation in Hawaii.

The bottom line is that marijuana and immigration laws are basically on the same level of selective non enforcement. In both cases this leads to a lack of respect for government authority. A good example of this is sanctuary cities in places such as Berkeley and San Francisco where dopers’ and illegal aliens can run free with impunity with no consequences of being busted.

This Wild West state of affairs is not good for society. In many ways things have not changed much since the days of Cheech & Chong. Most of the laws pertaining to pot are literally and figuratively “up in smoke”.  Even worse is the money wasted over the years with enforcement and its effects on thousands of citizens? Putting people in jail has accomplished virtually nothing and wasted tax payer’s dollars with dubious results.

A choice needs to be made to either legalize pot sales, while trying to regulate its distribution versus the present system of anarchy which no one seems to like. This November, it will be up to California voters to weigh in on how they feel on the subject. Fortunately, the playing field for the vote on Proposition 64 is on a fairly equal level. With exception of some pro-pot business interests, there isn’t lot money being spent on this campaign.

Perhaps this present sad state of affairs explains my apathy about the outcome of Prop 64. Few people believe that there is a significant risk of weed becoming a so called gateway drug which will lead to consumption of heroin and hard drugs. Yeh, it makes people forget promises made in the dark, where their car keys are located, and leads to a temporary state of couch potato syndrome; but smoking pot just does not seem to be such an important issue to me these days.

As such by a narrow margin, I plan on making a “yes” vote on Proposition 64. After all of these years it would seem to be hypocritical for me to become a follower of Nancy Reagan’s “Just say No” philosophy. The Baby Boomer generation and their siblings, who had to endure the “noble experiment” outlawing weed, should have this chapter of American history humanely come to an end on November 8th.

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More bad news for Concord’s partner Lennar-Five Point in CNWS project

It is not surprising that following my articles which were recently published which questioned the viability of Lennar-Urban and their subsidiary Five Point Holdings Inc. to finance the Concord Naval Weapons Station (CNWS) Reuse Project, a wall of silence  prevailed.

The San Fernando Spine Flower being designated as an endangered specie puts yet another nail in Five Points Newhall Ranch coffin
The San Fernando Spine Flower being designated as an endangered specie puts yet another nail in Five Points Newhall Ranch coffin

No one involved in local government seems to be willing to admit the distinct possibility that they have been dealt a losing hand selecting Lennar.

At the City Council meeting on September 13, 2016, not a word was mentioned about the serious charges brought forth about Lennar and their shell companies that might question their ability to do the job necessary to make the promises in the glossy four color brochure sent to every Concord resident come to fruition. Instead, the City Council spent a considerable amount of time discussing the composition of the largely ceremonial Citizens Advisory Council (CAC) that will oversee the new development.

For them, the fitness of Lennar to be their partner working together on the CNWS was not an issue. Since then a couple events have transpired concerning two of the chief components of my previous criticisms of the Master Developer selection process by the City of Concord of some note.

The “poor” stress rating for Lennar issued on September 2nd Dunn & Bradstreet (D & B) which stated that the company could be a candidate for bankruptcy in the coming year. Because of the magnitude of this dire prediction, apparently there was a lot of pressure placed upon D & B to review their previous findings. The results were published by the credit rating service on September 13th.

At that time D & B confirmed their previous findings that Lennar currently has an abundance of financial problems. If such a conclusion does not raise a red flag for the Council, City Manager, and staff, what will be needed for them to reconsider tying the knot with Lennar?

Would not change the dismal stress test rating given to Lennar Lennar
Would not change the dismal stress test rating given to Lennar

Considering the recently-obtained information, it would be a dereliction of duty for City management not to demand audited financial information immediately from Lennar for Five Point Holdings Inc. And why would the City not want this information?

Of equal concern is an article published in the San Fernando Valley News on September 14th which read in part:

[CBD] – In response to a settlement with the Center for Biological Diversity to speed protections for 757 species, the U.S. Fish and Wildlife Service proposed today to protect the San Fernando Valley Spine Flower as a threatened species under the Endangered Species Act. There are only two known populations of the flower, which is so rare it was once thought to be extinct.

The San Fernando Valley spine flower is an annual plant in the buckwheat family that grows low to the ground with small, white flowers. Historically it was found in washes and sandy areas in only 10 locations in the foothills of Los Angeles and Orange counties.

All 10 of these locations were lost to development, and scientists thought the species was extinct from 1929 until a population was discovered in 1999 in Ventura County and the Service placed the flower on the candidate waiting list for protection. In 2000 an additional population of the flower was discovered near Santa Clarita in Los Angeles County, within the footprint of the proposed Newhall Ranch Development Project.

The Ventura County population is protected from development because it occurs in a designated open space preserve. The population in the footprint of the Newhall Ranch development has been proposed for management under a conservation plan developed by the company, under the state Endangered Species Act, that allowed the company to remove part of the population in exchange for creating preserves to protect about 75 percent of the plants.

Protection under the federal Endangered Species Act will require the company and state to work with the Service to develop an expanded and supplemented conservation strategy.

The people of Santa Clarita apparently don't want to build a new community that resembles Agrestic as depicted in the notorious TV series "Weeds"
The people of Santa Clarita apparently don’t want to build a new community that resembles Agrestic as depicted in the notorious TV series “Weeds”

What this all means is that my previous comment that the shovels Lennar had in storage for ground breaking to occur on their Newhall Ranch development would be getting rusty waiting for the ceremony to occur, might be a bit of an understatement.

With the spine flower being designated for protection under the Federal Endangered Species Act, Lennar’s Kofi Bonner’s prediction of getting the Newhall ranch development back on track within a couple years does not seem to be even remotely realistic. Along with the California Supreme court’s decision in November 2015 to shelve the Newhall Ranch Environmental Impact Report (EIR), Five Point’s current principal asset is for all practical purposes DOA.

Coupled with the liabilities of Five Point is the debt held by the Third Ave Fund left over from the bankruptcy of Lennar’s LandSource subsidiary back in 2008. As such, why in the world would Concord want to be connected with them? It would appear them getting involved Five Point would be the equivalent of hiring the Captain of the Titanic to be your safety consultant.

This whole deal of Concord selecting Lennar has made no sense from the offset. By the city in effect running Lennar’s competitor Catellus Development out of town, the CNWS Reuse Project is in the hands of an inferior vendor with no solution in sight.

What has transpired in the last couple days with D & B sticking with their decision in down grading Lennar and the spine flower being placed on the endangered species list, ought to be a wake-up call for city government in Concord who is betting their future on a losing hand with few alternatives available.

Perhaps they should listen to Kenny Roger’s advice of “knowing when to hold em’, knowing when to fold em’, and when to walk away.”

Are these people willing to stake their futures on the ability of Lennar to be there so called partner and deliver the project the community yearns for?

We shall see.

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Dirty Tricks Upset Contra Costa Elections

Contra Costa Election Officials may have violated state law and free speech rights in choosing Voter Information Guide ballot arguments for the controversial Measure X, which would double the county’s transportation tax rate. By doing so, Election Officials left themselves open to criticism.

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Political Stakes High for Measure X Transportation Tax

Long before Election Day, voters are flooded with political mailers.  As November approaches, election fatigue kicks in and most political junk mail goes directly in the recycling bin, unread.

The only publication that reaches every voter is the official Voter Information Guide prepared by state and local election officials.  Voter Guides contain the full text of ballot measures and pro-and-con arguments.

For each ballot measure, only one official argument For and Against is published in the Voter Guide.  The arguments are selected by election officials according to state law.

Arguments in support of ballot measures are filed by the sponsoring government agency and, typically, others who stand to benefit from the measure.  Arguments against ballot measures are filed by organizations, such as taxpayer groups, or individual voters.

When more than one For or Against argument is filed, election officials must choose.

State law provides a pecking order for selecting ballot arguments for publication.  In most cases, this determines which argument is published.

On rare occasions more than one argument is filed with equal standing, per the state pecking order.  In such cases, most election offices use objective methods that demonstrate non-partisan neutrality.  Customarily election officials do a random draw or coin flip, with the involved parties present.  Sometimes the random selection process is filmed and posted on the election office website, as extra assurance to voters that everything’s on the up and up.

In past elections, Contra Costa election officials have used a coin flip to decide such cases.  Not so with Measure X.

Measure X = Lots of Money and Political Influence

Measure X is a 30-year half-cent transportation sales tax measure on the November countywide ballot.  It would double the current tax rate and is expected to raise $3 billion to benefit the Contra Costa Transportation Authority (CCTA) and regional transportation agencies.

Democratic Party campaign office in Walnut Creek
Democratic Party campaign office in Walnut Creek

The Measure X tax would be added to the current Measure J half-cent sales tax.  Measure J, expected to raise $2.7 billion, went into effect 7 years ago and was supposed meet Contra Costa’s transportation needs for 25 years, through 2034.

Passage of Measure X would conceal CCTA photo-4-8mb-sizespending problems, including steep borrowing costs that have exhausted money for projects promised under the current tax.  In photo-12-8mb-sizeaddition, both the Metropolitan Transportation Commission and BART are banking on getting Measure X money.

Election Officials’ Actions Earn Scrutiny

Two arguments against Measure X were filed with the Contra Costa Elections Office.  One was signed by a Marin County group and one Contra Costa voter; the other was signed by two taxpayer organizations and three Contra Costa voters.  The Marin argument addressed climate change and transportation policies.  The Taxpayer argument focused on the tax measure and controversial CCTA management practices.  (Full disclosure:  The author signed the latter.)

Contra Costa Election Officials determined both arguments had equal standing under state law, though this decision is disputed.  (Under state election code the argument with two organizational signers and three local voters should have been selected; the Marin argument should have been rejected.)

To decide between the two, Contra Costa Election Officials evaluated the content and quality of the arguments.  They used a subjective selection method, rather than flipping a coin or doing a random draw.  In doing so, Election Officials leave themselves open to criticism.

Clues to the Truth

One signer of the Marin argument publicly voted to support Measure X only four days before filing the argument against it with the Elections Office.  This is only one of several questionable circumstances that should be reviewed.

This week California Taxpayers Action Network submitted a complaint to the Contra Costa County Office of the District Attorney and civil Grand Jury, asking them to investigate and publicly report their findings.

A copy of the complaint is available here.

Trust is Earned

Michael Josephson, founder of the Josephson Institute of Ethics, says:

Trust is a coin with two sides. One is the willingness to trust another; the second side is the commitment to be worthy of another’s trust.

Contra Costa voters need to know if county officials are worthy of our trust.  How they respond to this complaint will begin to give us an answer.

Hillary making me nervous trying to live in a “deplorable” P.C. world

On better support Hillary or else
One  better support Hillary or else

“To just be grossly generalistic, you can put half of Trump supporters into what I call the ‘basket of deplorables.’ Right? Racist, sexist, homophobic, xenophobic, Islamaphobic, you name it.” Hillary Clinton before LGBT fundraiser Sept 9th

According to Hillary Clinton, those who are contemplating to cast their ballot for her opponent Donald Trump should be considered to be some form of a racist, bigot, white supremacist, or possibly holding KKK views. This kind of disturbs me. As an individual who grew up in the cultural milieu of San Francisco, my friends and business associates have historically been a literal United Nations of diversity.

Yet now the Democratic candidate is name calling in my direction because of me being an undecided voter. If the truth be known, the last time the last time I covered myself inside a sheet, it involved trick or treating pretending to be a ghost for Halloween. Even those who re-write history to depict George Washington and Thomas Jefferson as villains for owning slaves should give me a pass on that one.

Besides that I am of Jewish heritage which doesn’t exactly make me as a Face Book friend of David Duke or allow eligibility for the Lester Maddox Pickwick Dinning Club membership awards program.

As for being homophobic, this is clearly not the case. Again, I want to pull my San Francisco card and tell the world of my apathy for friends and foes sex preferences. Even if working in another life on Harvey Milk’s early campaign for Supervisor does not count, I have always had my fair share of gay friends of all stripes.

In my mind gay marriage is a non issue. If those of the same sex want to get hitched, they can be just as miserable as most straight people are. Who cares, as any card carrying libertarian such as myself might ask?

Being “Xenophobic “is another matter. I thought Hillary had me on that one because prior to looking this disorder up, I surmised being xenophobic was someone who has an aversion to Yoga classes, meditation, and self improvement pod casts. That is me.

Apparently I got off the hook because according to the reference bible Wikipedia:

Lester Maddox closed his restaurant down rather than serve African Anericans but used this as a spring board to become Governor of Georgia
Lester Maddox closed his restaurant down rather than serve African Anericans, but used this as a spring board to become Governor of Georgia. Ironically, Jimmy Carter served as his Lt. Governor.

Xenophobia is the fear of that which is perceived to be foreign or strange. Xenophobia can manifest itself in many ways involving the relations and perceptions of an ingroup towards an outgroup, including a fear of losing identity, suspicion of its activities, aggression, and desire to eliminate its presence to secure a presumed purity. The terms xenophobia and racism are sometimes confused and used interchangeably because people who share a national origin may also belong to the same race

It was a relief to learn that I do not belong in this subgroup especially because my day job is in international shipping where getting along with foreign cultures is part of the resume everyone in this field possesses. These same criteria equally applies to me for those who worship Islam as well.

As for being sexist, which Hillary accused those who do not support her of, I am somewhat guilty as my wife and daughters can attest. No matter how sensitive I pretend to be, it is still difficult for me to choose the Oxygen Channel rather than Sports Center for my viewing pleasure.

After all I am still a guy who struggles to be politically correct and sensitive to the feelings of others much of the time. Even if my approval ratings on the “macho meter” are somewhat challenged, I still faithfully empty the garbage each Monday and drag the can to the street for collection.

With this being said, there is still work to be done by me. On the other hand Hillary didn’t exactly hook up with Mr. Perfect either. When any women finds a mate without sexist tendencies, I would be more than willing to view the video production as long as it doesn’t conflict with a 49er game.

Hardly Mr. Perfect
Hardly Mr. Perfect

Having sexist leanings doesn’t preclude me from supporting female candidates or Democrats for that matter. Even if I am taking a pass for voting in the Hopson’s Choice Senate race in California between Kamala Harris and Loretta Sanchez, there are several office seekers of the feminine persuasion who will get my vote on November 8th.

Why then Is Hillary lashing out at middle class people trying to make us feel guilty should we not choose to make her President? I thought we were living in a democracy where being pro-choice was not only allowed, but celebrated as well? Apparently not.

Is Clinton confusing her desire to become the first Women President of the United States as a mandate to place her in the White House, no matter what one might think of her political views? In my case I do not approve of her work with the Iran Arms deal or what transpired in Benghazi while she was Secretary of State. And then there is email scandal which is still going on where it appears Hillary was not telling the truth much of the time.

These discressions could be cast aside compared to the Pay to Play tactics used to gain donations from foreign interests to the Clinton Foundation in exchange for favorable treatment by the State Department. In my mind they call such behavior treason.

So despite what Hillary might think of me, I still do not intend to vote for her ever. In the June primary, having “decline to state” registration, I could not select Ohio Governor John Kasich who would have been my choice. Unfortunately, one had to be a registered Republican in California to have voted for him.

With few options, I ended up supporting Bernie Sanders as a protest vote signifying my lack of alternatives. This act of desperation should have gotten my so called “progressive” friends off my back; but unfortunately I lacked the courage to tell them what had been done.

So as Jimmy Hendrix once said “Excuse me while I kiss the sky.” Or maybe a better way of saying this is what Stephen Stills quipped in For What It’s Worth “Nobody’s right if everyone is wrong.”

So be it.

 

Bitterness still remains on selection process that made Lennar-Five Point developer for CNWS Reuse Project

By Richard Eber

Ted Antenucci, long time CEO of Catellus Development Corporation, seems to be a man at peace with himself. Picking over a Chinese Chicken Salad while at lunch with me August 12 in Aurora Colorado, the celebrated developer defended his decision to accept a token $250,000 fee in May of this year from the City of Concord to withdraw his company for consideration to become master developer for the 3 billion dollar Concord Naval Weapons Station (CNWS) Reuse Project.

Catellus President Ted Antenucci decided to "Take the money and run" rather than continue to deal with the powers that be in concord.
Catellus President Ted Antenucci decided to “Take the money and run” rather than continue to deal with the powers that be in Concord.

Given what had transpired during the past year with the competition Catellus had with Lennar-Urban, he didn’t think his firm could get a fair shake in dealing with Concord’s City Council and their administrative staff.

Despite the fact that Catellus has had a sterling track record of building successful developments while at the same time possessing a sound balance sheet, in Antenucci’s mind the City of Concord inexplicably worked overtime to discourage his bid. He was equally perplexed of why Concord was supporting Lennar Corp’s competing proposal which the city staff earlier stated was inferior to what his company had tendered?

Even worse, Antenucci reasoned, Catellus had none of the baggage that came with Lennar: no bankruptcies, no FBI investigations, no bribery allegations, no fraud judgments, no Dun & Bradstreet downgrade, and no failed IPO. No employees and consultants like Willie Brown or Keith Jackson were part of the Catellus team either.

Antenucci eventually decided to cut his losses and move on. In his mind, capital-rich Catellus has enough on their plate dealing with municipalities that are trying to recruit them. Why put themselves in a position to be involved where they were not wanted, he concluded?

Another aspect of Antenucci’s concerns was that in order to be successful in competing with Lennar to land the Concord contract, he felt Catellus would have had to engage in questionable business practices that were not of his firms play book. Antenucci’s firm, who in the Bay Area is best known for their work done with the San Francisco Giants in the area surrounding AT&T Park at Mission Bay, took responsibility for not recognizing earlier the poisonous political climate in Concord and for not getting out of the CNWS bidding earlier.

What led to Ted Antenucci dropping the Concord project like a hot potato? It all began July 30, 2015 which was the reporting time for political donations for state offices. The following month Catellus learned that then Concord Mayor Tim Grayson, who was running for the State Assembly, had received $14,800.00 in concealed donations from businesses directly affiliated with Lennar. This, he felt was in contradiction to a side agreement the two parties previously agreed to not lobby to be chosen for the Master Developer slot.

Catellus was furious about these payments even after Grayson, who feigned ignorance on the origin of the funds, ended up giving the money back. The only regret Grayson publicly expressed was not vetting who sent large checks for his Assembly campaign earlier. A few weeks later when it was revealed that Grayson had met twice with Willie Brown, purportedly seeking only “political” advice on running for the Assembly, Catellus was fit to be tied.

Brown, who openly lobbied on behalf of Lennar, was Kofi Bonner’s mentor when he was Mayor of San Francisco. Even worse, Brown and his partner Steven Kay were principles in Golden Gate Development. This firm was working directly with Lennar to raise capital utilizing EB-5 funds which gave foreign nationals green cards for job creation in the USA.

Also upsetting Catellus was that one of the parties who contributed $4,200.00 to Grayson’s campaign was Brown’s partner Steven Kay. Another individual donating to Grayson was Philip Bunting, whose public relations agency regularly represents Lennar. On top of that Kofi Bonner’s daughter had served on their advisory board.

An additional conflict of interest that disturbed Catellus was that Tim Grayson’s then campaign manager was Mary Jo Rossi, also a protégé of Willie Brown in the Assembly. She had strong ties to Steven Kay and Philip Bunting. Catellus had a difficult time believing that it was a mere coincidence that all of this money flowed into Grayson’s campaign with nary a clue about the origin of these funds.

Concord Mayor Tim Grayson-state-of-city
How the CNWS selection process will effect Tim Grayson’s Assembly bid will not be known until November 8th.

Things got even more estranged between Mayor Grayson and Catellus when Grayson’s personal attorney (San Francisco insider Jim Sutton) along with Mary Jo Rossi were working hand and hand trying to convince Concord City Attorney Mark Coon to push forward with the developer vote at the same time Coon was investigating Catullus’s allegations of wrong doing.

Coon quickly cleared Catellus of charges brought forth by Grayson that Catellus was engaged in a conspiracy with discredited developer Albert Seeno to take over the CNWS project. There were also allegations Coon rejected that Catellus was purchasing tickets to Golden State Warrior games for city staff to curry favor with them.

Things became even more inexplicable when Mark Coon tragically committed suicide in late October of 2015 during the midst his investigation of Catullus’s allegations of unfair treatment. Whether the turmoil which was going on with the CNWS project played a role in this tragedy has never been determined.

Trying to right the ship, the Concord City Council brought in an independent party respected attorney Michael Jenkins to look into what was going on in the Lennar-Catellus struggle. Two months later, the investigator came out with the Jenkins Report which said that Lennar definitely broke their agreement not to lobby the City council by virtue of the side agreement made earlier.

It was difficult for Jenkins to come up with any other conclusions about Lennar’s activities because neither Mary Jo Rossi, Kofi Bonner, Willie Brown, nor Steven Kay was willing to speak with him directly.

Though unintentional breaking the Brown Act's open meeting laws was the tip of the iceberg in the turmoil involved with the CNWS selection process
Though this action was unintentional, breaking the Brown Act’s open meeting laws was the tip of the iceberg in the turmoil involved with the CNWS selection process

Mr. Jenkins condemned Lennar’s influence peddling, but made no recommendations to the Concord City Council on how they should conduct themselves on a go-forward basis.

Shortly afterwards, the staff report under city project manager Michael Wright endorsed the Catellus proposal. Apparently this did not please the City Council. Mayor Laura Hoffmeister, City Manager Valarie Barone, City Councilman Edi Birsan, and Tim Grayson. They tried to keep this recommendation away from the public. As it turned out, in doing so they were in violation of the Brown Act.

What made this even slimier was that although several news media outlets, including the Bee and East Bay Times exposed the cover-up, nothing was done to censure or disqualify Lennar from the CNWS selection process. In making this decision the Council appeared to use the “everybody does it” excuse to leave Lennar in as a finalist.

Ironically, Michael Jenkins, who presented his findings to the Concord City Council one night, stayed in town to give a Brown Act tutorial to the same group the following evening.

Tim Grayson, who had been leader of the anti-Catellus forces, ended up recusing himself because of conflict of interest issues. Councilman Ron Leone did not participate in the selection process on the recommendation of the city attorney’s office because his house is located within 500 of the Weapons Station property.

Given what had transpired, it would appear that Catellus with their seemingly superior proposal and not breaking the any lobbying side agreements, was in a good position to receive the Master Developer contract. In addition they had a strong financial position that did not require them to mortgage the property they were developing to pay for infrastructure costs.

Another major difference between them and Lennar is that Catellus planned to auction finished building sites in the CNWS project to the highest bidders. This contrasted with Lennar, who proposed to sell the land essentially to themselves as they planned to build 60% of the housing in the CNWS.

When it is taken into account that Lennar would be subbing out the construction of 25% of the project which is to be of the affordable housing variety, according to present plans they will control 90% of market rate residential property sales and construction.

Under these circumstances, Lennar would have no incentive to sell property at its highest value since in effect they would be selling it to themselves. This could come into play because amenities such as parks, bike trails, and recreational facilities at the CNWS are to be paid for principally from land sale revenues.

None of this mattered as the selection process continued. Even with the damnation of Lennar in the Jenkins report, the City Council decided to keep them as a viable finalist in the selection process. This decision was now in the hands of only three members of the City Council: Mayor Laura Hoffmeister along with City Councilman Dan Helix and Edi Birsan, who were still eligible to vote

With only three individuals making the decision on the developer, it soon became obvious to Ted Antenucci that his company would not be selected. There was still a great deal of hostility with the City Council because of Catullus’s alleged aloofness along with airing their dirty linens in public rather than doing this more in private with the City Council.

Indicative of this Edi Birsan commented at a Council meeting that he didn’t trust Catellus quipping he should wear a Kevlar vest to avoid being stabbed in the back by them.

Only Councilman Dan Helix, who is retiring at the end of November, seemed to be in favor of partnering up with Catellus. Seeing the writing on the wall, Ted Antenucci negotiated a buy out with the city. Once the agreement was made, the money was wire transferred into Catullus’s account the following day.

While Kofi Bonner and Lennar appeared to get the victory they coveted so much; no binding agreements have yet been executed by the two parties  It will be up to Guy Bjerke, who succeeded Michael Wright as project director along with City Manager Valarie Barone to negotiate the final terms with Lennar-Five Point.

Concord has shown some concern for Lennar’s bankruptcy with LandSource by limiting the amount of property they will allow them to control to no more than one 60 acre parcel at a time. Even if this provides some degree of security to Concord, the Council must also realize that they are dealing with an entity that has joined the exclusive club of Enron and Trump University in being represented by attorney Daniel Petrocelli in litigation matters.

Yet to be determined is how the transparency, co-operation, and team work both parties have pledged will unfold in the coming months and years ahead.

Concord’s “partner in development” Lennar-Urban-Five Point in dire financial trouble

A warm late summer evening found Concord Councilman Edi Birsan introducing Kofi Bonner to the Holbrook Heights neighborhood watch group as the President of Lennar-Urban’s West Coast operations. He was quickly corrected by Bonner who told the small audience that after more than a decade of being at the helm of Lennar in the Bay Area, he was now switching job titles to hold a similar position at Five Point Holdings Inc.

Credit rating firm Dun & Bradstreet not bullish on Lennar's long term prospects these days
The credit rating firm  of Dun & Bradstreet is not bullish on Lennar’s long term prospects these days

It is this Lennar-controlled entity which is their shell company for handling the operations of military base conversion to civilian purposes in California. Bonner explained that the Concord Naval Weapons Station (CNWS) project, which will someday house almost 40,000 people, will be managed under the Five Point umbrella.

This move is consistent with Lennar’s previous practices of using subsidiaries to their main corporation to shield themselves from legal and financial responsibilities should these ventures fail.

Perhaps there is a good reason why Bonner wants to separate himself from the orbit of the mother ship Lennar-Urban by changing his corporate identity to Five Point.  On September 2,  just prior to the Labor Day weekend, the credit rating service Dun & Bradstreet downgraded Lennar to the Financial Stress class “poor”. This is close to the bottom of the barrel. In their words “it’s a rating that predicts the likelihood your company will experience financial difficulty in the next year such as bankruptcy.”

This move came after D&B changed their PAYDEX Credit Rating to “fair” on July 5  and their Delinquency Predictory Class to “poor” on April 29.  Despite this the City of Concord apparently feels comfortable in becoming a partner with Lennar on the CNWS project. They seem to be suffering from amnesia when it comes to financial ruin associated with Lennar in the not so distant past.

This occurred in 2008 when Lennar’s LandSource LLC, the predecessor of Five Point, was placed into bankruptcy by Lennar for the express purpose of wiping out investors, lenders, and unsecured creditors. This move ended up killing their Mare Island Project which to this day has never recovered.

Focusing on the Mare Island development, even taking into account toxic waste problems at the former Naval Base where Liberty ships were constructed during World War II, Lennar has done little of what they originally promised. Instead of using their own capital, they have opted to use property tax revenues to finance their activities which to date has not included constructing any affordable housing units.

Even more distressing is the billion-dollar hit the California Public Employee Retirement System CalPERS took with their ill fated investment into LandSource. This legacy of financial ruin under Lennar management lives on today in Five Point.

Under Lennar’s guidance, the value of Five Point’s principal asset, Newhall Ranch, has been all but wiped out. The consequences of this failure continue to adversely impact both Five Point and Newhall’s principal investor – The Third Avenue Fund group.

Third Avenue Real Estate fund has failed to report the loss of equity in the Newhall Ranch development while continuing to issue rosy quarterly reports, even while a sister fund – Third Avenue Focused Credit Fund – was forced into an SEC-supervised liquidation in December of 2015. Third Avenue had purchased the distressed debt created by Lennar’s manipulated bankruptcy of LandSource LLC and later converted to equity after the bonds went unpaid.

Ironically, if Five Point were ever able to obtain approval for a stock offering, Third Avenue Fund would be the first creditor to be in line to be paid. This would, leave little if any of the proceeds for capitalizing Lennar’s California base conversion projects including Concord should they join the Five Point team.

This brings us to Five Point and their ability to borrow money to finance their endeavors.  Recently, they tried to float a stock offering for their military base conversion projects in California. This IPO of Five Point Holdings Inc. did not include the CNWS. At this time Lennar has not secured the final rights to development of the project. The CNWS is projected to be a big money maker given the shortage of affordable housing in the Bay Area

In May of 2016, Lennar and Five Point abruptly cancelled the Five Point IPO process citing a “choppy market”. This  explanation was not exactly true. Confidential sources close to the SEC tell a different story. If the truth be known, complaints were filed with the agency about the truthfulness and reliability of  data supplied to the SEC by Five Point.

If environmentalist's have their way, The unspoiled Santa Clara River will stay that way
If environmentalist’s have their way, The unspoiled Santa Clara River will stay that way which would halt construction of  Lennar’s Newhall Ranch development indefinitely.

When the SEC asked for more information pertaining to these complaints , the choppy market conditions became a tsunami. At that juncture, Lennar and Five Point either elected or was forced to withdraw the offering. Keep in mind this all happened prior to D&B’s dire warnings about Lennar’s overall financial health which was to follow.

Even if Lennar was successful in obtaining the development rights to the CNWS project prior to bringing the Concord project into the Five Point fold, there are many questions that must be satisfactorily answered. For example:

Newhall Ranch, in Santa Clarita California, is the largest current asset under their control. Unfortunately, the project is now in a near-worthless condition after the California Supreme Court stripped the development project of all of its entitlements in November of 2015. Lennar then moved for reconsideration from the court but was soundly rejected.

Lennar apparently failed to include this information in their initial mandated SEC filings which might have partially accounted for the cold shoulder they received for their proposed stock offering.

Of major concern were the facts and assumptions made in their Environmental Impact Report (EIR) that did not take into account the habitat of the Santa Clara River or the effect of traffic, smog, and increased green house gases on adjoining communities. In a rare move the California Supreme Court told Lennar to start their new EIR from scratch rather than to fix it in small segments as is normally done.

While Kofi Bonner initially predicted that this was a minor problem and could be “fixed” in a matter of weeks, Lennar  issued a press release shortly after the cancellation of the Five Point IPO that stated the problems with the Newhall Ranch entitlements were considerably more serious. They predicted a minimum of 1.5 to 2 years to solve the problem.

Outside observers predict it is more like 10 years, if ever. The bottom line is that as long as this development slowly works its way through the courts and a new EIR is written, the shovels Five Point has in storage will be getting rusty waiting for ground breaking ceremonies to commense.

One of Five Point’s better properties that they manage is El Toro-Great Park in Orange County. This project was procured in 2005 with a $775,000,000 loan from Lehman Bros.  When Lehman collapsed the note was purchased by State Bank in Boston for $ 150,000,000 which gave them effective control of the project.

State  brought in several investors including MSD Capital, Rockpoint Ventures, and Castle Lake.  Currently, these opportunity funds effectively own the majoprity of equity in El Toro. Lennar’s and Five Point’s role is essentially as manager which leaves little upside potential.

Looking at other parts of the Five Point Empire, “choppy markets” are very much in place. In San Francisco the Hunter’s Point Project is in a major state of discord. This undertaking has been a political football from the start.

Lennar oeiginally obtained the project in the mid 90’s by hiring Nancy Pelosi’s nephew, Laurence Pelosi as director of “Real Estate Acquisitions” along with Willie Brown, then mayor of San Francisco, who brought in  his protégé Kofi Bonner to run the operation.

The management group  later hired, as a political consultant Keith Jackson, another associate of Willie Brown,  He is currently under FBI supervision awaiting sentencing. Jackson, the former San Francisco School Board President and political fundraiser admitted arranging to accept bribes from undercover agents in exchange for political favors for then State Senator Leland Yee.

Surrounded by his legal team, Lennar's former political consultant pleads guilty to receive a more lenient sentence
Surrounded by his legal team, Lennar’s former political consultant Keith Jackson  pleads guilty to receive a more lenient sentence

Naturally Lennar, who paid Jackson over $ 500,000 as political consultant on the Hunters Point project, claims they were not aware of Jackson’s activities, including a murder for hire scheme that got him sentenced to nine years in Federal Prison.

Jackson, former head of the San Francisco Board of Education, has been known as an individual who can open doors. One of these doors was his involvement, with bid rigging accusations in carrying hazardous waste from the Hunter’s Point site utilizing minority owned contractors.

Concerns continue to this day that housing and commercial properties are being developed in toxic waste areas that have yet to be properly cleaned up.  More to worry about.

Also not to be forgotten is the scandal that the New York Times recently uncovered of Kofi Bonner being honored by the Washington D.C. think tank the Brookings Institute. They openly supported Lennar’s and Kofi’s work on the Hunter’s Point Project, despite the obvious toxic waste problems.

Absent in this high praise from the Brookings Institution was the fact that Lennar donated $ 400,000.00 to the group in 2014 as a down payment and continued to pour money into the non-profit in a quid-pro-quo pattern. At the same time the think tank continued to heap accolades on the work of Kofi and Lennar.

This pay to play model of Lennar has been widely criticized for its similarity to accusations made against the Clinton Foundation where donations to the organization have been followed by favors allegedly granted by Hillary Clinton when she was working as Secretary of State.

Back to Hunter’s Point. To date after 20 years following the start of the project very little that Lennar has promised (less than 10% of affordable housing  projections) have been delivered by them.

In fact Lennar through their friends in San Francisco City Hall are trying to pass Proposition M this November which would allow for building more lucrative office space instead of housing intended for Hunters Point in close proximity to the area surrounding where the Giants and 49ers once resided affectionately known as Candlestick Park.

In addition to the Hunters Point development, Lennar has a large interest in the Treasure Island Project which is converting the former Naval Base to housing and commercial use.  Preliminary construction has begun, but problems persist with sinking land on the man-made Island.

In addition, there is a need for a 8 million dollar plus sea wall that is required to combat sea level intrusion from the Pacific Ocean. Who is to pick up the tab for this costly improvement has yet to be determined? Even construction of a sea wall will not solve the fact that the island is slowly sinking.

Could this be another Lennar development headed underwater?

What’s left? Five Point’s material source of revenue to finance their projects is EB-5 money raised by none other than Kofi Bonner’s close friend Willie Brown. It is his Golden Gate Development company that has been a major source of funding for Lennar’s San Francisco activities.

Under a government sponsored program, rich folks in foreign countries, (mostly China) are allowed to gain green cards for themselves and family members by investing $500,000 to $1,000,000 dollars in the United States that create 10 new jobs in the workforce.  However, this EB-5 Program with all the investigations currently surrounding it including Congress and the FBI just might be on life support, and could be terminated at any time.

Should this be the case, Willie Brown and his partner attorney Steven Kay can gracefully exit having made a handsome return on their politically connected dealings with Lennar.

At the end of the day, the bankruptcy of LandSource  created difficulties borrowing from banks. Along with the SEC’s discovery that Lennar was supplying misleading information (designed to swindle a new crop on investors) has resulted in an inability to do stock offerings on Wall Street. Along with the collapsing EB-5 Program, portend finding investors willing to fund Five Point developments will not be an easy task.  Added to this bleak assessment is the dismal  rating from Lennar  put out by D & B.

This is why getting the Concord CNWS project into the fold is so important to Lennar as they need new developments to place in their arsenal of properties.

The parallels between Five Point Holdings Inc. and its predecessor, LandSource LLC are remarkable; which is not a good thing. Despite these facts of life, the city of Concord has been more than willing to stake their future on a company and their subsidiaries which are demonstrably dishonest and currently on the financial ropes.

Next – How and why Concord decided Lennar should be their “partner” in development.