MOORLACH UPDATE — Streetcar Warning — June 16, 2014

When I see a potential municipal financial fiasco on the horizon, my natural instinct is to provide a warning. The OC Register was kind enough to publish my concerns about the streetcar concept in the first piece below (also see MOORLACH UPDATE Streetcar Desire June 9, 2014). As every taxpayer in the OC may be subsidizing this arrangement, it is incumbent that you be forewarned. Orange County is a wonderful tourist destination and providing our guests with a viable transit system is easily done with buses. And, with the advances in technology, such as Googles driverless vehicle, better options than fixed-guide-way streetcars will be available in the future. It is the first piece below.

As for tomorrows Board of Supervisors meeting, the Voice of OC provides its perspectives of one of the agenda items in the second piece below. It would seem that articles of this nature would be more prevalent. How often does the media inform its readership on the contributions a county vendor has made to each of the Supervisors? Almost never. There are three priorities from which I make a decision to vote for a vendor. How much they contributed to my campaign is not one of them. The first is to let managers manage. If concerns about the firms activities in other jurisdictions is severe enough, then management can exclude any vendor that it wishes to, as being a responsible bidder is critical. Just ask Merrill Lynch how many years it took them to be reconsidered by Orange County. The second priority is to utilize outside firms wherever possible, due to the high pension costs of hiring employees. This is a position that is not shared by our public employee union leadership. The third is that I tell vendors who contribute to me to be the lowest priced and most responsible bidder and they will have my vote. I think Ive stated enough, but the item referred to (number 67, see http://ocgov.com/gov/bos/agenda/) is not providing alternative vendors and the selection process did not include this Supervisor on the panel.

I also have a column on Civic Openness in Negotiations (COIN) in the Flashreport see http://www.flashreport.org/ today or http://www.flashreport.org/blog/2014/06/16/civic-openness-in-negotiations-coin/. This topic will also be discussed at tomorrows Board meeting.

Why streetcars shouldnt be desired in O.C.

By JOHN M.W. MOORLACH

CONTRIBUTING WRITER

Anaheim and Santa Ana have used Measure M grant funding to recommend that streetcars be used to move riders to the train stations in both cities. The Orange County Transportation Authority has provided millions of dollars more to flesh out the proposals. The goal is to obtain the necessary funding from the Federal Transportation Authority through its New Starts program (never mind that the federal government is, at a minimum, $17 trillion in debt). But, its free money.

Anaheim has already begun the preparation of its Draft Environmental Impact Report to comply with the California Environmental Quality Act. The proposed streetcar line for Anaheim, connecting the train station with the Disney Resort and the Convention Center, is only 3.2 miles long. However, costs are expected to run about $100 million per mile.

What makes these streetcar systems so special? One thing is the possibility of paying for it with free money. Additionally, proponents proclaim that people prefer streetcars over buses. One advocate referred to streetcars as more charming. Being novel is about as deep as this option goes.

Whats not to like about a streetcar? Let me propose 10 things. The first is that its very old technology. If one streetcar malfunctions, the entire line is stalled until it can be towed or pushed by another streetcar, if possible.

The second is that its on fixed rails. There is no flexibility, and it is doubtful it would be quicker than a bus system.

Third, a bus system is more cost effective. The Anaheim Transportation Network adequately moves tourists around the resort area in buses, making a streetcar redundant and unnecessary. Using buses, according to one media account, would cost $260 million less.

Fourth, buses can be used for alternate purposes in the time of a disaster. The streetcar is of no use to anyone other than on the fixed route. And if the rails are damaged, the system could be out of use for months. Recently, a MetroLink train hit a cement truck in the Green River area. Buses were used to move the delayed rail commuters.

Fifth is the cost of eminent domain. Its unconscionable to demolish longstanding businesses to build a streetcar track. But that is what Anaheims EIR proposes to do. In the case of the proposed route, which is swarmed by tourists, the property/business values must already be astronomical. The proposal has the smell of sparing the Disney Resort from allocating property for a streetcar stop, at the expense of others.

Sixth, streetcars will mix with cars in general traffic lanes. This may be manageable, but it creates its own unique set of traffic hazards and will most likely add to the congestion (instead of alleviating it).

Seventh, the number of passengers disembarking at the train station to go to Disneyland is minimal. Using streetcars as a link with trains and other modes of public transit has been a big disappointment around the nation. Only the streetcar system in New Orleans has encouraging ridership statistics. Just like the early ridership projections for O.Cs toll roads, or the states high-speed rail dont believe them.

Eighth, claims that a streetcar system will encourage economic development along the route are mainly conjecture. Besides, the resort area doesnt look like it has had development problems. A recent survey of 13 streetcar systems in the country concluded that their economic impact was largely unknown.

Ninth is the shortness of the line. There is a long-term plan to connect the Anaheim and Santa Ana lines after 2018, at an unknown cost. However, walking a block or two to your next destination may be more expeditious than waiting 15 minutes for the next streetcar.

Finally, the emperor has no clothes. The streetcar fad is bolstered by weak reports written by paid consultants to support the projects. I found only one candid study. Coming out of Brooklyn, N.Y., it stated there would be a low expected ridership increase, significant costs, narrow streets and a zoning policy that precluded mixed use development.

Every taxpayer in Orange County will be paying for the two proposed city streetcar systems through Measure M sales taxes plus any cost overruns, fare deficiencies or other fiscal shortages. This was made abundantly clear at a recent OCTA board meeting and in a story in the Register.

The potential for free money could result in the subsidizing of centuries-old technology for decades, perhaps centuries. After all of the roads have been uprooted for tracks, it will be hard to walk away when the fiscal realities set in. It should be stopped now.

John M. W. Moorlach is a Republican member of the Orange County Board of Supervisors.

County to Renew Contract With Firm Sued By Feds

By NICK GERDA

Orange County supervisors are scheduled this week to grant a welfare management contract to a well-connected firm that was sued by the federal government for aiding an alleged Medicare fraud scheme.

The firm has contributed directly to the campaign accounts of all county supervisors.

Virginia-based Maximus, Inc. was sued by federal prosecutors for allegedly helping Washington, D.C. city officials defraud Medicare out of millions of dollars intended for foster children services.

The alleged scheme stretched all the way up to a Maximus vice president, prosecutors said.

The company ultimately settled the suit in 2007 for more than $30 million, deferring any criminal prosecution in the process.

Maximus was also the focus of controversy in California, where in 2010 it was revealed that positive drug and alcohol test results for more than 140 medical professionals were improperly discarded by a sub-subcontractor to the firm.

Maximus was paid $2.5 million per year by the state to run its alcohol and drug diversion program, and had subcontracted its drug testing to a Pennsylvania company, which in turn subcontracted to a firm in Kansas.

A state audit that year found that Maximus does not always report positive drug tests to the appropriate board in a timely manner, meaning healthcare professionals can keep working even after positive tests, according to the Los Angeles Times.

The audit also found that in more than half the cases reviewed, Maximus did not keep enough records that established that substance-abusing healthcare professionals were complying with all terms of the program, according to the report.

Following a bidding process in 2011, Orange County supervisors awarded Maximus a $4.9-million per year contract to provide case management for the countys welfare-to-work program.

Maximus is slated to receive a new three-year contract Tuesday at an annual cost of $6.3 million.

Campaign records show Maximus as a generous contributor to all five county leaders scheduled to vote on its contract.

The company gave a maxed-out $1,700 contribution to Supervisor Janet Nguyen in August 2009, as well as $1,700 to Supervisor Pat Bates campaign in 2010.

Supervisor Todd Spitzers campaign received $1,800 from the firm in 2011, while Supervisor John Moorlach received a $1,000 contribution in 2011 and another $800 the following year.

For supervisors Chairman Shawn Nelson, records show a $1,700 contribution in April 2010, another $1,700 in September 2010 and $1,800 in late June 2011.

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