Well, last week was just a mess.
Misspelled the editorial headline. Bea Beyer pointed out it’s spelled maneuver, not manuever.
She was the only one who noticed.
Mammoth Mountain’s Joani Lynch noted that Vail is giving out credits toward 2020-2021, not refunds for 2019-2020 as I had wrongfully suggested.
And certain pages of the paper that were supposed to be printed in color got printed in black-and-white because I had forgotten to notify the printer.
What the hell’s wrong with me?
But despite all that, I’m back again in the saddle tonight, marking The Sheet’s 17th anniversary (first issue came out May 14, 2003). One year left until adulthood.
And possible good news, Ikonics, related to ski passes. Alterra Resorts CEO Rusty Gregory suggested on the “Storm Skiing Journal and Podcast” hosted by Stuart Winchester on May 5 that Alterra’s terms and conditions regarding the Ikon pass may yet further evolve (and become more customer-friendly).
As I reflect upon this issue, I think there’s a theme running through it of winners and losers. As in, government policy creating a playing field where there are those who are largely insulated from the economic impact of the pandemic, and those who are bearing the brunt. And perhaps a third group which believes it’s affected (but is really not).
I’ve spoken to a lot of folks in the restaurant business over the past week. Folks who constitute some of the brightest and resourceful minds in the Sierra.
A few said they could make it at 50% capacity.
A few said they couldn’t. One said it’s tough enough to make it at 100% capacity.
It’s hard to walk away from onerous leases when you’ve invested so much in the TIs (tenant improvements).
But commercial real estate will have to take a haircut. If capacity is reduced by half, what does that make the real estate worth?
In particular, I was struck by what some owners of fine-dining establishments said. How do you cultivate a fine-dining experience in an atmosphere akin to downtown Chernobyl? And yet, some of the details they were thinking about were so thoughtful, so human. Like the idea of having face shields versus face masks because the sharing of expression is so important in communicating a mood.
One of the biggest obstacles for restaurateurs set on reopening is labor. As evidenced by our front page story, many workers are doing a helluva lot better financially right now than they ever did when they were employed,
So why would a guy forego unemployment plus $600/week to come back to work at a 25-50% capacity restaurant?
And how does a gal use her PPP loan to get people back to work knowing that there won’t be enough work and enough labor to spend the money on.
Labor received handouts. Business owners will ultimately get stuck with loans to repay that hardly helped them. Illegals? They get no help, either. Taxation without representation/benefit. And some actually think they steal from us …
Public agencies have also been slow to make adjustments. And public employees have been big winners.
The City of Bishop finds itself in fairly perilous straits. According to a presentation by Bishop City Manager Ron Phillips, the city estimates a $780,000 General Fund shortfall for 2019-2020, rising to $1.1 million for 2020-2021.
In a conversation the next day, Phillips revised the 2020-2021 number upward to $1.3-$1.6 million (out of a budget of $7.7 million).
This year, Bishop will draw down $600,000 in reserves to meet its obligations through June 30.
And yet, some of the “cost-saving” measures that Phillips offered at the Council meeting last Monday night reflected not so much cost-savings as cost-kicking-down -the-road.
Like minimally funding retirement accounts that are already significantly underfunded.
Or postponing (not eliminating) cost-of-living-increases until 2021.
And the contemplation (horrors) of asking employees to pay 15% of medical premiums versus 10%.
The last item is the only “sacrifice” contemplated thus far in any of the cost-cutting measures. The rest is just borrowing.
In Bishop’s defense …
It has already offloaded the salaries of two police officers. One officer via a grant is now the schools resource officer, Another officer left the force to join the MLPD.
Still, of Bishop’s $7.7 million budget, $3.1 milllion is spent on public safety.
Bishop is not filling vacant positions (there are five) and laid off 26 part-timers. Phillips characterizes current staffing levels as “really thin.”
Unlike Mammoth, Bishop has thus far resisted a lot of extra taxes. Bishop doesn’t have a UUT (Utility Users tax). Mammoth does.
Bishop’s room tax rate is a point lower than Mammoth’s.
Bishop doesn’t have a “local” sales tax, or TUT (Transactions and Use Tax). Mammoth’s is 0.5%.
Bishop doesn’t have a parcel tax. Mammoth does.
Phillips said “some kind of increase” would certainly be helpful.
“Myself, I lean towards no [on any increase] because it’s taxes.” -Mayor Laura Smith.
Bishop has begun to face reality. Sort of. It is scheduled to discuss budgetary matters at length at its May 25 meeting.
As for Mammoth, well, it held a community conversation on May 12 and pointed questions were asked regarding finances. I’ll let you, reader, parse through the transcript provided by Hite.
Q: It appears no efforts are being made to put a temporary freeze on funding of NGO’s [non-government organizations such as Mammoth Lakes Tourism and Mammoth Lakes Recreation]. Considering we have no significant revenue source I implore Council to make the tough decision to stop hemorrhaging money until we are able to reopen.
Q: What’s the capacity of Town employees [currently] working. I understand that Town staff might be working remotely. But I am specifically interested in knowing the financial obligations and commitments. Is everyone being paid their usual rates? Has anyone been furloughed or laid off, and if not, what is the plan?
Town Manager Dan Holler responded, “I can speak to a couple of those, but as to funding the NGO’s, that is a Town Council policy question to address. We have a lot of people working remotely, as well as some in the office. Obviously, our police department is fully staffed and our road department is out doing regular road maintenance. So people that have met all of those conditions are being paid their normal rates of pay. We have not laid off any active employees at this point. Early on, we let go a number of our part-time employees earlier than normal. We have frozen a few
different full-time vacant positions. We have gone through and stopped any non-essential purchases for the next couple months and we will continue that through the fiscal year. We are in the planning process … looking at next year’s budget as well as some funding plans/opportunities. We do have some difficult decisions to be made in that area in terms of work programs that need to be reduced. There will be other measures we need to take to make sure we are able to continue to move forward in a financially prudent manner.
Councilman John Wentworth addressed the NGO question, “These are important questions. Obviously this is not a meeting that the Town Council can take any action on. But I would hope that when we start getting into these issues, these very difficult and tough financial questions for the town, that we will be making strategic decisions, we are putting the interest of the community first, and that we are not cutting just to cut. That we aren’t making arbitrary or capricious decisions. I am very much looking forward to what the Town manager and the mayor and the types of questions you will bring about in front of us. To the folks paying attention to the Council meetings, we have requested that Rob, the Town’s finance director, bring us scenarios that we can use to balance and weigh the relative merits of the decisions we are going to make. So that we can be doing this in a strategic and tactical way to put the interest of the community first. And that we are not acting arbitrarily. Those are my thoughts.”
Then Town Finance Director Rob Patterson chimed in, “I think Mr. Wentworth did a good job of explaining the process we are about to take. We budget very conservatively year after year
*Lunch: I agree. This is true.
That does a couple of different things. Number one it sets us up to weather a short storm like this. But also, we have set aside those excess dollars into the reserves to try and protect us. This limits the size of our operation so that if we need to cut back, even in a year where we are down $6 million, we can sustain what we have … We are working through the cuts that we need to make in that process … Making arbitrary decisions so you will have some inflicted pain, I don’t support that.
Where I would challenge Patterson.
The town bonded $5.5 million for a rec center project which appears permanently on hold. The town seems to be using that bond money as a de facto reserve account. This would be disingenuous. And we’ve spent more than $300,000 servicing that bond since 2017.
Second, Public Works Director Grady Dutton talked last week about all the designated accounts (housing, roads, airport) that are effectively getting drained to bolster the town’s financial position.
I would hate to think whatever money we’ve saved over the past few years will disappear into the great, bureaucratic, self-dealing maw.
That would consign taxeaters to the aforementioned category #3.