Disinformation Campaign by City Administrator Rich Guillen & Mayor Sue McCloud

THESIS: City Administrator Rich Guillen and Mayor Sue McCloud have dishonestly engaged in a disinformation campaign to explain the city’s status quo by citing “financial difficulties.” In reality, the status quo can be explained by City Administrator Guillen’s and Mayor McCloud’s ongoing campaign to centralize all power, authority and control with them. They have either forced city employees to prematurely retire or created a working environment which has caused city employees to voluntarily leave the city. These were not “cuts,” as City Administrator Guillen communicated to Herald Staff Writer Dania Akkad. Rather, they were purposely eliminated positions. Moreover, since the elimination of these positions, none of the positions have been filled; no Assistant City Administrator, no Public Works Director, no City Forester, no Planning Director, no Fire Chief, no Library Director, et cetera.

BACKGROUND: On Sunday, 18 February 2007, The Monterey County Herald published an article entitled, “A step toward consolidation: Peninsula: PG to contract with Monterey for fire official” by Herald Staff Writer Dania Akkad. In the article, Akkad wrote “With their small size, high cost to run separate departments, and especially in light of financial difficulties in Pacific Grove and Carmel, it makes sense, officials say.”

On Sunday, 18 February 2007, a Carmelite contacted Dania Akkad and wrote in part, as follows:
“While a Carmel-by-the-Sea official may tell you that the city has “financial difficulties,” a professional would publish the fact that the City of Carmel-by-the-Sea has an annual budget of $12 million dollars (per capita spending of approximately $2,926) and reserve funds of nearly $10 million dollars.”

“In short, a reporter who fails to engage in the disciple of verification and provide facts for context is irresponsibly misleading the public. Moreover, printing what you are told, without verification, is not a principle of journalism; it is propaganda.”

On Monday, 19 February 2007, Dania Akkad wrote the Carmelite to explain, as follows:
“Carmel City Administrator Rich Guillen told me that since 9/11, Carmel has had to be innovative with the way it spends its money because the tourism industry revenues have decreased significantly since then. He told me that in 2004, the city cut more than 20 full-time positions and that a future consolidation makes sense as the city continues to pursue innovative ways to get more services for the same dollars. That was what I was referring to by ‘financial difficulties’.”

On Tuesday, 20 February 2007, the Carmelite responded to Dania Akkad’s explanations, as follows:
Herald Staff Writer Dania Akkad: “Carmel City Administrator Rich Guillen told me that since 9/11, Carmel has had to be innovative with the way it spends its money because the tourism industry revenues have decreased significantly since then.”

Carmelite’s Response:
Revenues: Major 5 Totals:
FY 2001/02 8,948,985 -15%

FY 2002/03 8,623,105 -4%

FY 2003/04 9,079,076 5%

FY 2004/05 9,302,991 2%
*Without the first year accrual income the “Major Five” total would be $9,441,882 and a 11% increase in F.Y. 00/01 and a 5% decrease in F.Y. 02/02. The Hostelry Tax total would be $4,045,589 a 7% increase in F.Y. 00/01 and a 11% decrease in F.Y. 01/02.”

(Source: http://www.ci.carmel.ca.us/, CITY OF CARMEL-BY-THE-SEA CALIFORNIA DRAFT BUDGET FISCAL YEARS 2006/07 THROUGH 2008/09, pg. 42 of 72)

Herald Staff Writer Dania Akkad: “He told me that in 2004, the city cut more than 20 full-time positions and that a future consolidation makes sense as the city continues to pursue innovative ways to get more services for the same dollars. That was what I was referring to by "financial difficulties".”

Carmelite's Response:
GENERAL FUND TOTALS

Actual FY 2004/05
$ 11,921,573

Revised 2005/06
$11,931,765

Proposed FY 2006/07 $ 11,649,860
Proposed FY 2007/08 $ 12,077,916
Proposed FY 2008/09 $ 12,008,964

(Source: http://www.ci.carmel.ca.us/, CITY OF CARMEL-BY-THE-SEA CALIFORNIA DRAFT BUDGET FISCAL YEARS 2006/07 THROUGH 2008/09, pg. 46 of 72)

Herald Staff Writer Dania Akkad: “financial difficulties”

Carmelite’s Response:

A comprehensive understanding of the fiscal state of Carmel-by-the-Sea requires knowledge about the city’s reserve funds, not just each year’s general fund. As shown below, Carmel-by-the-Sea’s reserve funds grew from $8,322,653 as of June 30, 2005 to $9,593,226.00 as of June 30, 2006.

CITY OF CARMEL-BY-THE-SEA
California
Annual Financial Report
June 30, 2006

BALANCE SHEET
Government Funds
June 30, 2006

FUND BALANCES
Reserved for debt service:$627,309

Unreserved:
Designated: $5,359,692
Reserved: $552,884 (Parking)
Undesignated: $3,053,341

Total Fund Balances: $9,040,342 $552,884

TOTAL: $9,593,226.00

(Source: Financial Statements, CITY OF CARMEL-BY-THE-SEA, BALANCE SHEET, Government Funds, June 30, 2006, CITY OF CARMEL-BY-THE-SEA, California, Annual Financial Report, June 30, 2006.)


CITY OF CARMEL-BY-THE-SEA
California
Annual Financial Report
June 30, 2005

BALANCE SHEET
Government Funds
June 30, 2005

Fund Balances
623,709 Reserved for debt service

Unreserved
$37,662 Designated for street and traffic safety
$740,451 Designated for liability insurance
$647,527 Designated for health insurance
$1,370,334 Designated for capital improvements
$249,579 Designated for equipment replacement
$1,432,394 Designated for benefits and wc insurance
$657,000 Designated for reserves
$549,690 Designated for economic uncertainty
$165,011 Designated for emergency response
$140,000 Designated for general services and operations
$468,857 Designated for customer deposits
$1,240,439 Undesignated

8,322,653 Total Fund Balances

(Source: CITY OF CARMEL-BY-THE-SEA California, Annual Financial Report, June 30, 2005, FINANCIAL STATEMENTS, Fund Financial Statements, Balance Sheet – Governmental Funds.)

Herald Staff Writer Dania Akkad:
“So I guess it could be said that all three cities have had some work to do on their finances in recent years, as have so many other cities in California.”

Carmelite’s Response: Admittedly not being familiar with the fiscal state of either Monterey or Pacific Grove, I doubt if Monterey or Pacific Grove have reserve funds totally 80% of their annual budgets; the convention and standard for most cities is to have 10% -20% of their annual budget in reserve funds.

Herald Staff Writer Dania Akkad:“I welcome your input as I am not a propagandist,...”

Carmelite’s Response:
While I appreciate your view that you are “not a propagandist,” the record of staff writers and editorial commentators at The Monterey County Herald in their coverage of Carmel-by-the-Sea has been as purveyors of the City Administrator’s and Mayor’s spin, without any hint of verification through other sources of information, i.e., individuals, documents, audits, staff reports, et cetera. Moreover, when corrections and clarifications have been brought to the attention of The Herald, they have been routinely ignored. This state of affairs leads readers to believe that The Monterey County Herald is not interested in covering Carmel-by-the-Sea fairly and objectively. Moreover, two other Principles of Journalism have consistently not been upheld, namely “ITS PRACTITIONERS MUST MAINTAIN AN INDEPENDENCE FROM THOSE THEY COVER; “While editorialists and commentators are not neutral, the source of their credibility is still their accuracy, intellectual fairness and ability to inform--not their devotion to a certain group or outcome” and “IT MUST SERVE AS AN INDEPENDENT MONITOR OF POWER.”

FINAL COMMENTS:
Citizens of Carmel-by-the-Sea are not well informed about the state of their city for two main reasons.

1. Mayor Sue McCloud, and her City Administrator Rich Guillen, have a covert policy of eliminating city positions in order to centralize power, authority and control with them, exclusively. Furthermore, they dishonestly alibi their policy by citing “financial difficulties.” In reality, it is an issue of priorities, not finances. That is, Mayor McCloud, City Council Members and City Administrator Guillen have refused to budget and fund deferred maintenance projects which would benefit residents and the city, including maintenance and upgrades to the Scout House, Forest Theatre, Flanders Mansion, streets and roads, et cetera. All the city’s deferred maintenance projects should be budgeted and funded from General Fund revenues and Reserve Funds.

2. The Staff Writers and Editorial Commentators at The Monterey County Herald have a long record of not honoring journalism’s “Principles of Journalism,” including, “JOURNALISM’S FIRST OBLIGATION IS TO THE TRUTH,” “ITS FIRST LOYALTY IS TO CITIZENS,” “ITS ESSENCE IS A DISCIPLINE OF VERIFICATION,” “ITS PRACTITIONERS MUST MAINTAIN AN INDEPENDENCE FROM THOSE THEY COVER,” and “IT MUST SERVE AS AN INDEPENDENT MONITOR OF POWER.”

In sum, because Mayor McCloud and City Administrator Guillen are dishonest individuals who purposely mislead reporters and the public, and because local media writers and commentators “print what they are told,” Carmelites are ill informed about the state of affairs in Carmel-by-the-Sea. These obstacles to an informed Carmel-by-the-Sea citizenry must be overcome if Carmelites are ever to recapture the essence of the City of Carmel-by-the-Sea as “primarily, a residential City wherein business and commerce have in the past, are now, and are proposed to be in the future subordinated to its residential character.” Only then will Carmelites be able to proudly enjoy all the amenities of Carmel, including a rehabilitated and ADA compliant community center in the Scout House, a renovated and ADA compliant Forest Theatre, a rehabilitated, renovated and publicly used Flanders Mansion, a regenerating forest, et cetera.