Schipske to Remain Focused on Council Work Until 2014 -- Says State of City Needs to Be Improved

January 24, 2012 – Long Beach City Councilwoman Gerrie Schipske today issued the following statement concerning her plans for the next two years:

“I want to thank those who have encouraged me to run for higher office. Your support and confidence are gratifying. However, many people also have come forward and urged me to continue my work on the City Council – being a voice of reason and asking the questions that need to be answered and bringing the community together through events, forums and discussions. 

The City of Long Beach faces  incredible challenges due in no small part to actions taken in Sacramento:  the release of criminals back into our community and the State Legislature’s elimination of redevelopment – which impacts more than 40% of Long Beach.  

In the first three weeks of the new year, Long Beach has experienced a dozen or more shootings – several of which were murders. Residential burglaries are up in my district. Our Police force is spread thin because of budget cuts – which I voted against. Our Fire department is using staff from the Westside of the city to cover the eastside – which I voted against. City employees in every department are stretched thin and services reduced – again which I voted against. Instead of using increases in oil revenues to restore cuts to public safety and quality of life services – as I proposed – these monies will be spent on one time special ‘projects.’ 

Additionally, public trust of government is at an all time low and needs to be restored by making all levels open, transparent and accountable. To make the City of Long Beach more transparent, accountable and collaborative – I have just announced the launch of OpenUpLongBeach.com – a project to involve residents in making certain this happens.

For these reasons, I have decided to continue to focus my attention on serving the City of Long Beach for the remainder of my second term on City Council. I urge residents to join me in the efforts to get more police and firefighters and to open up the City of Long Beach in order to make our local government accountable to and collaborative with its residents. Help me send the message that the ‘State of the City’ needs to be improved.”

League of California Cities Analysis on Pack Supreme Court Ruling

Click here to read an analysis of the Supreme Court decision concerning the City of Long Beach's ordinance which regulates medical marijuana collectives and why the council has been advised we need to revoke the ordinance and ban the collectives -- especially any with more than 4 members.

Teaching the Basics of Solar Energy to Our Local Students

 It is important that we teach our students the basics of solar energy so that we can stop being dependent upon fossil fuels. Part of our effort in the Solar Grand Prix is to make students aware of this important alternative energy source.

Click below and see a short video on basics of solar energy.


Solar Multimedia: Solar Power Basics

Preview of Solar Grand Prix Orientation This Weekend

Open Up Long Beach -- Why We Need to Do It

I have launched  OpenUpLongBeach.com -- a website and resident project to identify what we need to do to open up the City of Long Beach -- its records, its data, it processes and who impacts the decisions.

For instance:

• Residents trying to obtain emails of elected officials find themselves blocked because many elected officials now use private, personal emails to conduct city official business and claim it is not discoverable as a public record. If official business is being conducted on personal emails a copy of that email should be sent into the city email system to capture a record. (I do this on any email sent to me on my non city email.)
• Although elected officials must post campaign contributions they receive for city offices on the city website, they do not post on city websites the money they receive for their state or federal campaigns -- money received from those who have are doing business with the city or who have a financial interest in the outcome of the city's decisions. The public has to expend a great deal of time searching other websites to see who has donated to our city officials.
• The current collective bargaining process tells the residents little of what is being bargained -- unlike school districts which by law have to disclose publicly in a meeting before bargaining begins so that the public gets a chance to comment on the proposals. The residents of Long Beach are given little information on the proposals until they are basically a "done deal."
• Business that wants to decide whether or not to come to Long Beach or to expand in Long Beach find little data readily available on the website. Opening the data and making it readily available in other cities has grown businesses. Entrepreneurs have developed applications that help local government use the data better.
• What does the city spend tax dollars on? The data is lumped together in the annual budget report -- but why isn't there data given every month on line? It is the taxpayers' money and several cities and states have found it helpful to post the payments and expenditures on a regular basis so that taxpayers can see where their money is going.
• Who does the city contract with for services? There is a tab on the city website where you can search. But you need to know the contract number or the day the city council approved it. How about just listing all the contracts so the average citizen can get information that is a public record?

There are many, many more examples of how we can open up Long Beach so that we can hold all elected officials accountable.

Please check out the website: OpenUpLongBeach.com and come to our first informational meeting. The public is invited.

California Supreme Court Will Hear LB Case on Medical Marijuana

Supreme Ct Medical Marijuana

2012 Solar Grand Prix Team Orientation

Long Beach, CA – The 2012 Solar Grand Prix will not happen until April 21^st, but many teams are already registered and excited to compete. Last year, the event picked up steam and saw 150 teams and over 400 students race their carefully designed and constructed cars in El Dorado Park. The Solar Grand Prix challenges local students to use scientific know-how, creative thinking, experimentation, and teamwork to design and build high-performance model solar vehicles.

This year, to enhance the overall experience for all participating teams, registration was limited to 50 middle school and 50 high school teams, with a maximum of 5 teams per school. Teams must also be comprised of exactly 4 students, with a parent or teacher serving as a coach.

Councilwoman Schipske and the 5^th District Solar and Sustainability Task Force are still encouraging students in grades 9- 12 to sign up. Registration materials may be accessed by going online to http://admin.longbeach.gov/district5/solargrandprix/.

Long Beach City College is co-sponsoring the mandatory team orientation, which will take place on Saturday, January 21^st at the school’s Liberal Arts Campus. Car kits from the Segue to Solar Online Store are supplied to the teams and paid for by event sponsors.

Should the City Council Take Over Redevelopment? We Don't Have the Money and Now We Don't Have a Choice..

As you know the State Legislature has abolished redevelopment and the California Supreme Court upheld their actions. Unless additional legislation is passed, redevelopment agencies have to be dismantled by Feb.

More than 40% of Long Beach was placed into redevelopment -- which means the tax increment from properties in these areas went back to redevelopment projects and not for use for police, fire, recreation, libraries or any other general fund service of the city. These redevelopment projects have acquired a considerable amount of debt which needs to be paid off. Additionally, the City employs 34 staff for these redevelopment efforts.

So cities are being given the choice of either assuming the assets, debts, liabilities and employees of redevelopment or turn it over to another agency or entity.

In Los Angeles, Mayor Antonio Villaraigosa has urged the city council not to assume this risk because of the continuing shortfalls in the City of LA's general fund. The LA City Council was provided an in depth analysis of the financial costs of the City Council becoming the successor agency for redevelopment projects. Check the LA Times story about this.

Click here to read the analyses given to the Los Angeles City Council  about why the risk is too great for the city to become the successor agency for LA redevelopment:

• Letter from Mayor Villaraigosa to LA City Council
• Letter from LA City Controller to LA City Council
• 38 page analysis prepared by LA Administrative Officer
• Fiscal Impact Analysis prepared for LA City Council
• A report from the LA City Council Housing Committee

In contrast, the City Council was given a brief memo with no financial analysis and the recommendation that the Council become the successor agency. I cannot support this action unless and until the Council receives a detailed analysis and an evaluation of the risk of the City taking over millions in debt. Click here to read what Long Beach City Council has been provided.

But the most disturbing fact I have learned researching this issue, is that the City Council was supposed to act by January 13th if it (like the City of Los Angeles) wanted to opt out of assuming the risks of becoming the successor agency for Long Beach redevelopment.

The memo from the Long Beach City Manager is dated January 17th -- 4 days after the deadline for the Council to decide if it wanted to opt out.  Who decided for the City Council that we would become the successor agency? I don't recall a memo telling us of this deadline, nor the City Council taking a vote that it didn't want to opt out.

So next Tuesday, the City Council will be told, I mean get to decide, that it must assume the debt, liabilities, employees and operations of redevelopment. Stay tuned because I want to find out how it is that our City Council didn't get a full analysis of this issue and the choice to say "NO" to taking on debt we can't afford to pay.

Schipske Launches "Open Up Long Beach" Effort

Check out our new website on "Open Up Long Beach" -- a project to make the City of Long Beach more open, transparent and collaborative in 2012.


www.openuplongbeach.com

2012 Brings New Look to My Blog

Thought it was time to update the look of my blog.

As I write, the fog is still thick around El Dorado Park. I can't believe how much moisture it leaves on the sidewalks and streets.

Am hopeful 2012 will be better for many people. The economy seems to be improving for some. Long Beach has major challenges ahead as we grapple with how to bring jobs back to the city that now has one of the largest unemployment rates in the state.

I am grateful to be teaching again at CSULB. Teaching can make such a difference in a person's life. One of the my students wanted to quit last semester and I convinced her to stay -- she did and did quite well on her final grade. These students face higher tuition and costly textbook fees. Many cannot get the classes they need to graduate so they have to stay in school longer. I believe that anything a teacher can do to make their lives easier -- should happen. That's why I let as many students in my classes as are on the waiting list. Having 50 students in a class is harder for me -- but being a parent of college age students I know the pain of not being able to get through college in a 4 let alone 6 year timeframe.

Working on the State of the 5th Council District -- we usually have a good turnout. Also we start work on the Annual Solar Grand Prix which last year brought 150 students teams to the competition.

Again, I will be focusing on how best to maximize infrastructure dollars to get sidewalks and streets repaired and trees trimmed.

I wish you all a prosperous and healthy New Year.

Crime Stats in the City of Long Beach

Click here for Crime Stats

City of Long Beach's Investment Portfolio for October 2011

Click here to read the latest on the City's investment portfolio.

My Comments During Council's Vote on 2nd and PCH

Before I vote on this project, I think it is important to set out a number of issues that need to be considered before the vote is taken:

·      Tonight and this last week – are not last minute appeals – this is the first time these individuals have had the opportunity to address the city council with their issues – so let’s not mis-characterize.

·      I also want to clarify that Lyon Communities is not a new developer – they have been very active on a number of projects in the City.

·      I do believe it is misleading to state that the City needs to go forth on this project because the property in question is such an eyesore. The property is an eyesore – because the City of Long Beach has allowed it to be so. The site is littered with buses, limos, strawberry stands, a building that has been allowed to run down and no matter how we vote tonight – the eyesore needs to be cleaned up. Code enforcement needs to do its job – we demand that our residents maintain their property – we should do no less with other property owners.

·      We have somehow put the proverbial horse before the cart. The area being considered is included in a comprehensive planning area – called SEADIP – Southeast Area Development and Improvement Plan – a plan that was crafted by the residents and the developers – in the 1970s to control density, building heights to no more than 35 feet and traffic in a specific area. Any development of property within SEADIP must either conform with the plan – which this projects does not – or SEADIP must be changed in context with the entire area. This has not been done.

·      Let’s take a moment and talk about the purpose of SEADIP – and why Long Beach residents and developers worked together. It was the 1970s, and Long Beach was infamous for allowing developments without much care for impact. In fact, the City Planning Director was convicted of taking bribes from a team of architects who worked on 6 projects – including Marina Pacifica – at the time the largest building permit ever issued by the City Planning Department. The plan was put together in little over a year from mid 1976 to August 1977. While the plan was being developed Market Place and Marina Pacifica retail area went forward which compounded the traffic and impact on the area. Residents vowed this should not happen again. Residents and developers labored to put together this plan with the following purposes: first of all deal with the traffic impacts of Bellflower and 7^th – called the iron triangle – and Second and PCH – called the iron bottleneck.; keeping overall density and building heights low; keeping surrounding neighborhoods free of cross town traffic; keeping open spaces in the area. When SEADIP was adopted by the City Council it was hailed in an editorial in the Press Telegram: Something Great. The area was referred to as Long Beach’s Last Frontier.  Residents and developers had worked together to preserve the area and to require any development to be done consistent with an overall plan not done piecemeal.

·      The project also has to be approved by the State Coastal Commission. Today, City council members received a two page memo from the State Coastal Commission Manager who states: In discussions with City staff over the past year Commission staff has consistently stated concerns relative to the proposed project at 2^nd and PCH. Specifically, staff has recommended that any significant changes to the use and development standards for this parcel should be considered only as a component of a comprehensive review and LCP update of the existing SEADIP.  It is reasonable to expect that other property owners of commercially developed parcels along PCH would expect to receive similar development entitlements from the City in the future. Commission staff believes that the only way to determine the true development potential of any single parcel within the SEADIP is via an LCP update that takes into account the cumulative impacts of all potential future development in this plan area including the parcels currently containing or potentially containing wetlands.”

·      If city staff were told this for the past year, why wasn’t council so informed? Why wasn’t the developer informed? And why would the city once again go forward on a project we know doesn’t conform with our own local coastal plan.

·      As to the retail potential of 2^nd and PCH – I would like to quote from a 1970’s news article on Marina Pacifica and why the City needed it: 80 specialty stops, 9 major restaurants, 4 story office complex, a wooden pedestrian and bicycle bridge to promote neighborhoods to come to the shopping center, 2 novel design elements, 80 ft bell tower compared to St. Marks Square, mall will attract regional shoppers, shoppers will arrive by boat – the only facility in the nation to offer such facilities.

·      The traffic problems at Second and PCH are not mitigated in this project and can’t be because of the current configuration of the area. It only seems logical that the City needs to review and update SEADIP so we can deal with this entire area at one time and not in pieces. Because if we don’t – the owners of the adjacent properties at Market Place and Marina Pacifica will likewise want to develop and the problems will continue to compound.

·      Being called not business friendly is the new label to slap on anyone elected official who doesn’t want to give away the store…well for those of you who don’t come here every Tuesday – this council has given away millions of sales taxes away to businesses – Best Buy, Worthington Ford, Circle Audi….

·      But being a cheap date or pushover when it comes to our own zoning restrictions – doesn’t make us business friendly. It makes us contempous of the residents who have to navigate the messes we allow.

·      I would remind all here tonight that retail development isn’t happening anywhere – to date we still do not have tenants for the retail portion of Douglas Park in my district – and trust me – this city has facilitated every request for development on the former Boeing property.  That property is ready to go – so if you truly have retailers lined up to come to Long Beach – please send them over to Douglas Park.

·      But dealing with this project  -- let’s really be a business friendly city and get this right. Let’s get SEADIP reviewed and get the traffic mitigated so we can bring in development that will work in the area – not make the area a place where because of traffic – people once again do not patronize a massive development. 

I then made the motion which was approved 8-0 to direct city staff to move rapidly on setting up the process for reviewing and revising SEADIP.

Get to Know SEADIP Because You'll Be Hearing a Lot About It

There is much confusion over exactly what is SEADIP in Long Beach, how it came about, whether or not it has to be followed today and why the issues it dealt with are the very same ones now being raised by potential developers at 2nd and PCH.

History:
In the 1970's Long Beach was famous for allowing the building of developments without much care for their impact. The City Planning Director in fact was convicted of taking more than $52,000 in bribes from a team of architects who worked on 6 projects..that by the way were built...including Marina Pacifica (at that time the largest building permit ever issued by the City Planning Department).

The City Manager resigned before being ousted and the Council formed taskforces to deal with a number of issues including: citizen participation, reforming appointments to committees, commissions and boards.

Prior to the arrest of the planning director a citizen taskforce north of Seal Beach. The plan to be developed was called Southeast Area Development and Improvement Plan (SEADIP). Members of the taskforce became very upset when it was disclosed that 4 of the developments for which bribes were accepted were in the area being studied for regulation.

The focus of the taskforce was to deal with development in a responsible way that did not adversely impact the existing neighborhoods. Residents contended that PCH and Second Streets were clogged.
They argued that projects already under way (Marina Pacifica Shopping Center and the Market
Place) were too big for their approaches and that coordination of planning between city and developers
was inadequate.

As the Chairwoman Jan Hall told the local press: "It would be a tragedy to allow high density development in the SEADIP area that would compel unacceptable traffic conditions or radical measures..."

One of many newspaper articles pointed out that increasing the density of the SEADIP area would not be consistent with the Naples-like character recommended for the area in a shore line study done for the city by Sasaki-Walker.

When the 113 page document was finalized by the taskforce and adopted by the Planning Commission, SEADIP was hailed in editorials by the local press because it was a compromise of development with preservation. -- setting a maximum commercial building height of 35 feet.

SEADIP became an amendment to the 1961 general plan and was adopted unanimously by the City Council in 1977.

See below to read a series of newspaper accounts of what went on during the formation of SEADIP.
 Traffic Snarls SEADIP
Del Sol Project Approved
Beginnings of SEADIP
SEADIP Talks Extended
SEADIP Hearings
LB City Council Adopts SEADIP
 SEADIP A Dilmemma for the City
 Heart and Soul of SEADIP Gets Approved
Citizens Help in Planning
The Map of Long Beach's Last Frontier
Editorial Praising SEADIP


There are many more articles on SEADIP. But these should give you an idea of the intent and purpose of those many citizen meetings.

Why SEADIP Matters Tonight

Tonight the City Council will decide whether or not to approved the 2nd and PCH project -- you know, the one that promises to obliterate the blight at the southeast entrance to the City.

Before I go further, you have to ask yourself...self, why has the city not done code enforcement over there to make the owner clean up the property and stop using it as a parking lot for buses, limos and double deckers? Or has that been the plan all along...make it look so bad that the city would say yes to the first plan to come along to change it...

Anyway, I attended a town hall a few weeks ago sponsored by the Los Cerritos Wetlands Trust and listened to a full house ask numerous questions of the guest speaker. Among the many concerns expressed about the project and the city staff recommendation is the fact that city staff has now recommended amendment to SEADIP Local Coastal Plan that will not only allow changes in development restrictions for 2nd and PCH but be used as the template for additional development in SEADIP. Whoah....wait a minute buddy. We have gone from a specific project to an entire development area?

Little problem folks that may land the City back in court like we were taken on the ill planned Home Depot project adjacent to the wetlands...the EIR only addresses the impact of the specific project not changes to an entire zoning area.

The rules are clear and have been since the residents of the area and developers came together in the 1970s and established SEADIP – not high rises (buildings above 35 feet) and traffic and other impacts have to be mitigated. The proposed project breaks all the rules – so that is why some want to change the rules.

I am linking in this article Los Cerritos Wetlands Trust documents; articles on SEADIP; and the topic of the hour – the City staff report.
http://longbeach.legistar.com/LegislationDetail.aspx?ID=987797&GUID=2863C647-F6CE-4DD5-8784-795FA85244CC

Traffic Impact

Alternates for site

SEADIP and Traffic

Seadip complaints

Seadip -- Dilemma for the City

Press Telegram editorial praising SEADIP


Stay tuned. It is far from over.

Things I Have Worked on this Month...

 I want to call your attention to several important items I have worked on:

1. Long Beach Joins Specific Needs Disaster Voluntary Registry

   The purpose of this registry is to facilitate the planning and implementation of disaster response by first-responder agencies to Specific Needs persons living in the County of Los Angeles. The registry is a project of the Los Angeles County Office of Emergency Management in cooperation with other cities and agencies in the Los Angeles County disaster response operational area.
   
   If you (or the person you are registering) live in Los Angeles County and have any of the following conditions which might impede with your abilities to evacuate a building, travel to or stay safely in an emergency evacuation center, or to securely shelter in place without assistance, then you may want to consider enrolling in the Registry.
   
   Should a disaster strike in your area, this registry will be used to enhance the efficiency of those agencies called upon to respond. Enrollees are not prioritized for first consideration or evacuation. However the responding agencies will use this information to maximize their capacity to serve those with specific needs, both in the planning and preparation process, as well as in their actual post-disaster response.
   
   

   	Physical disabilities
   	Cardiac and/or respiratory circumstances
   	Developmental disabilities
   	Emotional or psychiatric disabilities
   	Deafness or hearing loss
   	Blindness or severe vision loss
   	Speech impairments
   	Short-term disabilities
   	Reliance on technologies that use electricity
   	Using medications
   	Participation in a home delivery program
   	Need specialized paratransit vehicles
   	Experience seizures
   	Immune system deficiencies
   	Communicable diseases
   	Severe chemical or other allergies

   Enrollment in the Specific Needs Registry is completely voluntary. Please read and understand the following paragraphs before enrolling. If you choose to enroll, please fill out the forms as completely and accurately as possible. Please remember to keep your registry profile updated, especially if your circumstances change. The information you provide could help to save your life.
   
   Click here and find out more about the SNAP registry.

2. Public Meeting on Potential Closure of Redondo Avenue Post Office. 
Although I was unable to attend, I did send staff to represent me and to clearly state my opposition to losing this postal site and the 600+ jobs that go with it.
Click here to find out more about the closure.



3. Update on Construction of New High School at DeMille Site.

I have requested periodic updates on the construction being done at the site of DeMille. The new facility will be a state of the art high school named after African American leader Ernest McBride. Click here to read update.

4. Vin Fiz Replica in Place at LB Arena -- Less than 900 feet from Where Cal Rodgers Landed in 1911.

The ceremony was wonderful and we even had a long lost relative of Cal Rodgers come all the way to see the replica that was being place in the lobby of the LB Arena...just less than 900 feet from where he landed on December 10, 1911, completing the first flight across America. If you get a chance, stop by the Arena lobby and see a piece of Long Beach and aviation history. Click here to read more about the event in the City Manager's newsletter.

5. Annual Report of the California Medical Board on which I serve.

This Board licenses and disciplines all physicians in California. I have been proudly serving as the only Registered Nurse (and Attorney) on this or any other Medical Board in the US for over 4 years. Click here to read our report.

 I do lots of work on behalf of the 5th Council District. Thought it important to share some of what has taken place this month.

City Investments Need Review

Last week I authored the "Responsible Investment Policy" that calls upon the City Manager and City Treasurer to provide a report concerning the soundness of the city's millions in investments in Bank America, Freddie Mac and Fannie Mae. It also calls upon the City Manager to send a letter expressing the concern of the City Council that many of our residents are in foreclosure and have not been able to work with lenders to modify their mortgages so they can stay in their homes. I also included a provision that the City encourage Bank America to make small business loans available so that our local economy can grow and create more jobs.

The item was approved on a 7-1 vote (DeLong opposing; Garcia absent). Mr. DeLong railed against the proposal and claimed that the City had been assured that the investments are sound by the rating agencies. Unfortunately, rating agencies also assured the City of Long Beach (even while newspaper articles warned of problems) about Lehman Brothers and the City lost millions of dollars.

I authored this item because one out of 243 homes in California are in foreclosure and these three financial entities hold more than 50 percent of all mortgages. Additionally, all three financial entities are under investigations at state and federal levels.

Just last week the California Attorney General Kamala Harris announced her investigations.

This morning on the front page of the newspaper, it was announced that the Securities and Exchange Commission (SEC) is pursuing actions against the executives of Freddie Mac and Fannie Mae.

http://www.presstelegram.com/news/ci_19565950

If the City Council won't stand up to make sure our investments are not only sound but that are placed with institutions that are not harming our residents and taxpayers, then we should be ashamed.

DeLong demeaned the effort stating our investments are miniscule compared to the overall amounts invested nationally in these entities. Really?

If you really believe this, then why do you have us spend so much time on the council passing resolutions on federal legislation when we are just one city out of thousands of cities in the US?

Why I am Voting to Ban Medical Marijuana Collectives and Dispensaries

After careful research and reviewing the advice of the Long Beach City Attorney, I am voting in support of banning medical marijuana collectives and dispensaries in the City of Long Beach. This council directed the city attorney to draft an ordinance to ban collectives in response to the ruling of the court. We did so in October. This just didn’t pop up.

First of all – I recognize the rights of those with medical problems to use medical marijuana. And nothing we do tonight will take away the rights of qualified persons to grow or have their legitimate caregiver grow medical marijuana for their use.

But there is nothing in law that requires the city to facilitate commercial operations of collectives. This city attempted to regulate collectives and the court has now told us that we cannot do so.

Second of all – as a city council, we have been informed by our legal advisor – who under our city charter is the only legal advisor to the city council – that we can no longer allow these entities in our city. We have been informed by our Chief of Police that their hands are tied if we continue to allow these collectives without regulation.

The people here tonight present some compelling arguments for not moving forward – but I have – this council has a legal responsibility to comply with legal direction from our city attorney and to not tie the hands of our police. Both have told us that to do nothing is not appropriate.

We are asked constantly why we can’t allow pharmacies to sell marijuana – it is because it is an illegal drug under federal law.

Like it or not, alcohol is legal – and is regulated by state and federal law – and quite honestly, we cannot locally regulate alcohol. We can regulate the hours and conditions under which it is sold and that is it.

People mention tobacco – this council has banned public smoking… and plastic bags because of health and safety concerns.

But here’s my dilemma – do I dismiss what the city’s law enforcement and legal advisors say I need to do?

On the other hand, I hear the real appeals of those who use this substance. But I am also concerned that state law is very clear that only a primary caregiver can provide marijuana if not grown by the qualified person – and that the primary caregiver has to have provided housing, health and safety prior to providing marijuana. These collectives do not do this. So how is it that we can allow them?

I would urge anyone here tonight or listening to this meeting that if you do not like the outcome of the vote that you take action and do a referendum. City law provides that voters can gather signatures to overturn any vote taken by the city council.

Schipske Calls on Council to Examine City Investments in Financial Entities That Are Foreclosing on LB Homes

Schipske Calls on Council to Examine City’s Investments in Financial Entities That Are Foreclosing on Long Beach Homes and Are Facing Federal and State Investigation – Doesn’t Want Another Lehman Brothers

December 9, 2011 --Councilwoman Gerrie Schipske today called upon her colleagues to support an agenda item she is submitting titled: Developing a Responsible Investment Policy In Connection with City Investments in Bank America, Freddie Mac (Federal Home Loan Mortgage Corporation) and Fannie Mae (Federal National Mortgage Association). The item takes aim at the fact that the City of Long Beach is investing millions in the same financial entities that are foreclosing on the homes of Long Beach residents.

“The City invests an enormous amount of funds with Bank America , the Federal Home Loan Mortgage Corporation and the Federal National Mortgage Association and all of these entities hold mortgages on which they are foreclosing in Long Beach,” explains Schipske.

“Additionally, these same entities are facing federal and state investigations and litigation because of their risky dealings – just as what occurred with Lehman Brothers. We don’t need to lose another $22 million.”

Schipske’s proposal would direct the City Manager and City Treasurer to provide a report to the City Council within 30 days that addresses the soundness of the investments and provides a status report on the numerous legal actions being taken against Bank America, Freddie Mac and Fannie Mae, as well as alternative investments available to the City.

“It does not seem logical nor right that the City of Long Beach would be placing cash or investments in financial entities which are putting our residents in severe economic hardship or in entities that are the focus of national and state investigations and litigation,” says Schipske.

The Federal Housing Finance Agency in September 2011, filed suits against Bank America and 16 other banks for selling FHLM and FNMA mortgage backed securities that soured and for which the federal conservator of FHLM and FNMA is seeking repayment.

Last week, the California Attorney General Kamala Harris announced a joint effort with the Attorney General of Nevada in the investigations of wrongdoing in mortgage loan origination, servicing, and securitization. Attorney General Harris is also investigating Bank America and FNMA and FHLM.

“ I am also asking that the Council direct the City Manager to send a letter to these financial entities expressing the sense of the City Council that because of our massive investments that we demand that every effort be taken to prevent the foreclosures of residential properties in Long Beach, including but not limited to loan modification and extension of the foreclosure process; and that we further demand that business loans be made available to businesses on a reasonable basis to enable these small businesses to create additional jobs.”


One in 243 homes in California are facing foreclosure. Freddie Mac and Fannie Mae hold almost 50 percent of all mortgages in the U.S.
#30