Blog Note: This article refers to a recent Monterey County Grand Jury report
According
to documents obtained by The Californian through the California Public Records
Act, ag-tech consultant John Hartnett has received a whopping $699,100 from the
city through May of this year.
So way back in the day — you
know, the fall of 2011 — the city began a business relationship with Silicon
Valley tech consultant
John Hartnett and his SVG
Partners group.
His mission, as oft described
by former Mayor Dennis Donohue, was to bring Silicon Valley venture capitalists
to Salinas to marry high-technology and ag together in such a fashion as to
deliver investment and create jobs.
At first glance it seemed like
a good idea.
I mean, who doesn't like the
idea of increasing ag production and food quality at the same time as creating
jobs that pay real living wages?
Fast-forward to the present day
and the narrative from Salinas City Hall has seems to have changed.
Almost four years after the
city engaged Hartnett there are few if any actual "deliverables" to
count from SVG — certainly no real investment money — unless you count the
delivery of public funds to him and his partners from the city treasury.
How much you ask?
A lot.
According to documents obtained
by The Californian through the California Public Records Act, Hartnett
and company have received a whopping $699,100 from the city through May of this
year.
Add in the extra $90,000 the
City Council approved for his services at its June 9 budget meeting and the
total jumps to $789,100.
So what exactly did we get for
our $789,100?
Well, we got this cool kids
computer coding club, we got two classes for local business entrepreneurs
(organized through the outside Kaufman Foundation), we got a whole a bunch of
colleges and universities saying what a great idea it was to merge ag and
Silicon Valley tech, and we got the promise of a still-not-open business incubator
program. We also got a business "thrive" program and an agreement by
Forbes to stage an ag-tech conference here early next month.
Hartnett has also set up a
swell new relationship with the Western Growers Association, which will
apparently run the new incubation center office once it's stood up.
Now, to be sure, $189,000 of
that $789,100 is Capital One blood money — (you know — that $1 million the
credit card company gave to the city when they decided to abandon its Salinas
operations for the fairer climes of South Dakota and displace about 800 local
workers in the process?)
The city says an additional
$67,500 paid to Hartnett comes from a grant the city received from the Economic
Development Administration.
So that means that your general
fund — the part of the city budget that pays for real things like police and
fire, roads, sidewalks and and drinking water pipes — paid out (or will pay
out) $532,500 — yes, more than a half-million dollars — to SVG.
(Damn. I knew I should have listened to my mom
when she told me to get into the consulting biz.)
To his great credit Councilman
Tony Barrera was the only member of the City Council at the June 9 budget
meeting with the guts to question City Manager Ray Corpuz Jr.'s spending
$789,000 on Hartnett.
"What deliverables have we
received?" Barrera asked simply.
Corpuz then did a masterful
thing.
In the course of a what was
about a 5-minute-long response, Corpuz quite literally changed the narrative of
why the city was involved with Hartnett right in front of our eyes.
In a low-key but determined
rhetorical style, Corpuz deftly told us that Hartnett's real goal all this time
wasn't about bringing investment money (hard dollars) here but to simply seed
and prepare the ground for future investments, i.e. laying the groundwork
(sorry) for venture capital money still to come.
And maybe, to be fair, Donohue,
Corpuz and Hartnett all set out thinking initially that with the right effort
that hard cash would rain all over the Salinas Valley in a relatively short
amount of time.
But it didn't, and now we're in
deep with this thing to the tune of $789,000. (And who knows, the City Council
might even throw another $90,000 at Hartnett at is mid-year budget review.)
It's true this amount isn't all
that big a deal compared to the size of the city's recently passed $184 million
operating and capital budget.
But that's not the point,
either.
I think at a minimum Hartnett
and Corpuz needed to be upfront with the taxpayers that doing something like
this wouldn't happen overnight — not even close. In other words the
expectations of why we pay Hartnett $15,000 a month drowned out the realities
of what is involved in trying to get Silicon Valley to invest here.
And, who knows, maybe five
years from now, if some real investment has come here we'll all look back and
pat ourselves on the back thinking how wise we were to hire Hartnett. Who
knows, maybe Corpuz will be hailed as a genius for his prescient thinking.
I hope for all of our sakes
that really happens.
I mean even an Econ 101 student
would be able to figure out that ag just can't continue to be ag. The field
worker shortage alone means we need some pretty clever technology to tend and
harvest the huge variety of crops we grow here. (Mechanical strawberry
harvester, anyone?)
Clearly, we need to bring more
science and technology to our fields.
I just wish our own City
Council had done its job by questioning what was going on here earlier.
When we talk about why people
distrust local government, this is the kind of thing that makes people just
shake their heads and turn away.
So at this point I think it's
fair to say we're all pretty much joined at the hip with Hartnett — like it or
not.
Let's all pray that the
metaphorical fields he has seeded deliver in a big way come harvest time.
Don't tick off the civil grand
jury
Proof positive that if you're a
city with a reputation for having an infamously slow, customer-unfriendly
business, permit and application processing center you should really try to
avoid running into members of the Monterey County Civil Grand Jury.
Unfortunately for the city of
Salinas a member of the jury ran smack dab into the frustrating jaws of the
city's 19th-century-era permit processing system when he tried to fill out a
business license application form online.
But unlike most people who just
take their business to another city, this jury member convinced his colleagues
that a full-on report should be issued on the problem.
That report was issued publicly on
Monday.
Here's a quote:
"One of the members of the
Monterey County Civil Grand Jury was considering doing business in Salinas and
accessed the City's web site to review the process of applying for a business
license. It was found that there are only two ways to apply for a business
license as a new business: by mail or in-person. If an applicant wants to mail
a completed form to the City, he must telephone the Finance Department to
determine the license fee for his specific business. Finally, it was discovered
that there is no database on the site that contains the identification of
business licensees."
Ouch.
But, it's nothing that a lot of
people in our business community didn't already know.
Here are the jury's formal
recommendations to the city:
•Add to the Business Portal of the
city's website the current business license application as a type-in fillable
PDF form that can be sent to the city's Finance Department via the city's
website without an actual signature but with a checked verification of the
information under penalty of perjury.
•The city of Salinas should hire
or assign an employee to track and collect delinquent business license fees.
•Add a secure credit/debit card
page so that license fees, new as well as renewed, may be paid online.
•Create a link to a page on the
city's website that explains clearly to the public how to calculate the
business license fees for all categories of businesses and include step-by-step
examples of how to calculate the fees for the most common businesses.
•Create and maintain on a periodic
basis (at least annually), a data base on the website that includes the names,
addresses and telephone numbers of all of the city's business licensees and
when each license expires.
Like all entities who become the
focus of the civil grand jury, the city will now have to formally (and legally)
respond and explain what it intends to do about the permitting issues.
I'm sure the city will say it
just didn't have the budget to update the city's computer system or hire more
staff and better train them. All that would be true, too.
But in a city that needs every
dollar it can put its hands on, it's just no longer acceptable to have a
permitting process with a hostile, bureaucratic and anti-business reputation.
I'm not saying that the city
should give away the store and/or forget its duties to uphold our laws and
regulations.
What I am saying is that the
city needs to approach each applicant from the perspective of helping him or
her get a permit in a timely, professional and businesslike manner.
Kudos to this grand jury for
taking notice and writing this one up.
June
23, 2015
The
Salinas Californian
By Jeff
Mitchell
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