Anaheim LLP
Commentary by Rick Reiff
MAYBE ANAHEIM’S CITY COUNCIL IS STILL SMARTING FROM SUPERMARKET CHAIN Gigante’s success in derailing its attempt to micromanage grocery shopping in the city, so the council has decided to shuck the regulatory role and instead go into commercial development and investment for itself.
That’s one way to interpret the council’s decision last week to spend about $7 million on each of two money-losing ventures.
One of the $7 million outlays is for a new clubhouse at city-run Anaheim Hills golf course. There is general agreement that the existing, 35-year-old clubhouse, part of a profit center that contributes about $1 million a year to city coffers, is on its last legs. But critics question the need for a replacement twice the size that includes an expanded banquet facility. The city’s own projections show that the city’s net cost to cover the capital expenditure will amount to about $400,000 a year. The only plausible way to close the gap appears to be to raise fees to the golfers, including Anaheim residents. Did anybody ask them if they wanted to subsidize a dining room?
Councilwoman Shirley McCracken, a project supporter who lives near the golf course, defended the new clubhouse to the Register this way: “It’s part of the community that has expensive homes surrounding it, and it really needs to measure up to the whole neighborhood.” Call it trickle-up spending.
The council also decided last week to buy the Grove Theater, taking back the then-empty parcel it sold for $2 million in 1997 to Ogden Entertainment, which spent $15 million to build the theater. The city’s cost to exercise its “right of first refusal,” then, is less than half of Ogden’s land-and-construction costs. That part sounds like a good deal for the city, until you consider the theater has exhausted three private operators, changed its name twice and still remains a struggling enterprise. Backers of the deal say the city can hire a better private manager for the venue.
Officials also say the purchase will enable the city to maintain control over all of the parcels that constitute “Sportstown,” the dreamed-of sports, retail and entertainment complex linking Edison Field and The Pond. Indeed, the purchase would stop the theater from falling into the hands of Melodyland Christian Center, a ready buyer professing a desire to fit into the existing entertainment scene with its Christian music. Since the church says it’s ready to pay $1 million more than the city has offered, and there are courts of law, the story may not be over.
Granted, Anaheim has a better track record than many cities at these sorts of things. One can argue that the city-run electric utility, its golf courses, or the millions Anaheim put into the Disneyland expansion and Edison Field renovation demonstrate the city’s business know-how.
But a power company has captive customers and the golf courses have wide appeal. The cases for a fancy clubhouse and a hobbled nightclub are far less convincing. In the case of Disneyland and Edison Field the city was chipping into private ventures making a big impact on the city; Anaheim’s expenditures went into infrastructure or leveraging outside investment. These latest projects appear capricious by comparison.
“If you looked at taxpayer money as your own money, you wouldn’t invest in them,” said Councilman Tom Tait, who cast the lone dissenting votes against the two projects.
City coffers are tight and the economy is shaky. Even well-run companies are having trouble improving golf courses, serving meals and filling seats.
Maybe Anaheim’s leaders are smart enough to buck these trends, but I think the city would be better served if the $14 million were put into activities with a more obvious public benefit.
, Rick Reiff
