The 1.8 billion dollar courthouse

Posted on September 18, 2012

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Someone way more familiar with the Long Beach project dropped us a note overnight showing us the errors of our ways. Apparently, the AOC did not sign up for a 22 million dollar per year building which would represent just the costs of construction number and it is the costs of construction number that the intellectually dishonest over at the AOC’s ministry of truth are promoting. Of course we can leave it to the AOC to not reveal the real costs which are about to floor you.

The AOC signed up for a $53 million dollar per year rent payment (for 35 years) or roughly  $1.7 MILLION per year per courtroom. All of these other fees and costs being tacked on include service and operations and maintenance fees, so while they will not commit to maintaining any public building they own, they absolutely committed to maintaining a public building that a private developer owns. 

Do you see yet why we don’t like PPP projects?

Did anyone know that the AOC committed this pot of money to ONE project? Total out-the-door cost? 1.855 BILLION dollars. Apparently the rent payment mentioned in the Cheryl Miller / recorder article being 44 million dollars is not even for a full year but when they’re scheduled to occupy it in the fall until the end of the fiscal year. A full annual rent payment is actually $53 million dollars.

The note goes on to state that both the AOC and the investors were eyeing SB1407 funds from the onset to fund this project and that was the reason everyone signed on the dotted line “because the money was there.” I wonder if Justice Hill has factored in a front-loaded 53 million dollars per year in his grandiose plans. The number of 53 million per year is higher than the annual facilities maintenance budget for all 500 buildings that the AOC owns and operates while all those buildings suffer an additional 250 million per year in deferred maintenance.

Payments like this coming from funds destined to pay back bonds (front-loading) would take about a billion dollars away from other court construction projects from around the state.  Additionally, the private/public partners were given a free reign over the project without any AOC oversight and never had to deal with any of the standard regulatory oversight required for bond funded projects. Additionally, the partners received certain tax benefits that are quite significant and also received title to a nice ocean view lot where they will build a 30 story plus high rise condo project without paying a dime for the property in a property trade.

Is that the sound of boiling blood I hear out in the trial courts?

The legislature needs to charter a department of common sense and Senator Leno would be our recommended pick when he terms out. Under the usual AOC guise that appearances are far more important than money, it appears the AOC may have signed on the 1.855+ billion dollar dotted line.

Finally, the note urges a top-to-bottom invoice by invoice audit of the entire SB1407 bond program run by the AOC because this money is being mis-spent by the AOC without any fiscal controls and on projects well outside the scope of legislative intent. “This whole story of the Long Beach Courthouse and the spending of SB1407 bond funds by the AOC has legs” the note concludes, “as bad as you think it is now, it is far worse than anyone can possibly imagine”