City Council
Taxpayers Pay for City Council Trip to Olympics
By Stacy Holmes
The City Council is proudly announcing the agreement reached with the Netherlands to do some of their training prior to the 2028 Los Angeles Olympics in Mission Viejo. To seal the deal, Council Mayor Pro Tem Bob Ruesch, Council Member Brian Goodell along with a City employee have traveled to Paris to meet with the Dutch officials at the Olympic Games. Previously, Mr. Goodell had traveled to South America trying to drum up business for Mission Viejo prior and during the 2028 Los Angeles Olympics. It’s not clear if the Council is trying to drum up business for Mission Viejo businesses or just trying to get known as a “sports town”.
There is no explanation as to why the deal with the Netherlands could not be completed without an expensive trip to Europe by three Mission Viejo representatives. The text of the agreement has not been released to the general public. We are told that some of the cost of the trip will be borne by the Dutch, but not the air fare and perhaps not other costs.
How much is this misadventure costing? It looks like MV residents and taxpayers are paying for intercontinental trips for Mr. Goodell and others. Some of those costs may be paid by the Dutch, but a substantial amount is paid by Mission Viejo taxpayers.
Exactly how much are MV residents and taxpayers paying for South American and European trips and other promotional activities? How much are the Dutch or others paying MV to use City facilities? What additional expenses does the City anticipate paying to maintain and staff athletic facilities used by non-resident Olympians? What displacement of residents’ use of the City’s recreational areas will be necessary to provide the Dutch with the agreed upon training space?
How is it not unethical or even illegal self-dealing for two of the four Council members who voted to spend the MV taxpayers funds to fly two Council members and a City employee to the Paris Olympics when those two Council members were the direct, personal beneficiaries of their votes? Had they recused themselves, there would not have been the required three votes to approve the funds for the trip. Council member Cynthia Vasquez voted against spending the City’s funds to send Council members on a junket to Paris to see the Olympics.
Mission Viejo Subsidizes the Nadadores Foundation for Another 10 Years
by Michael Schlesinger and Walt Lawson
On September 26, 2023, Mission Viejo’s City Council voted 3-1 to amend and renew its contract with the Nadadores Foundation, Inc., for 10 years to July 1, 2034. Mayor Goodell abstained due to his position on the Board of the Nadadores. Council member Cynthia Vasquez voted against it.
The City owns the Marguerite Aquatics pool complex and is responsible for its management, general maintenance and capital improvements. In 2018 the City completed an $11 M capital improvement project to renovate the entire Center.
The Nadadores Foundation, a private 501(c)3 Foundation, uses the Marguerite Aquatics Center exclusively as a training facility for swim and dive programs that over the past 50 years has produced national championship teams and Olympic medal winners. The Foundation does not pay rent for use of the complex; instead, it pays for certain aquatic complex management activities, such as for marketing and events, public swimming and diving programs, as well as a portion of the utility expenses.
To use this facility, one does not have to be a resident of Mission Viejo but must become a member at a projected general membership cost of $1,368/year as of January 1, 2024 ($104/month, plus annual fee of $50 and required fee to US Masters Swimming program of $70). In contrast, a single general membership cost to swim at the City’s Montanoso or Sierra Recreation Center is $360/year after a one-time registration of $50. The Aquatics Center does not allow leisure or lap swimming like can be done at the City’s Montanoso or Sierra Centers; its members must sign up for 50-minute swimming workouts with a coach.
To justify the large ongoing subsidy to this private foundation, which is open to non-residents, the City maintains that the Nadadores club brings economic benefits to the City, national / international marketing advantages as well as “swimming and diving instruction to the residents of Mission Viejo.” However, no detailed analysis of the specific economic benefits to Mission Viejo businesses, particularly the limited numer of hotels and restaurants near the Center, has ever been presented. Meanwhile, Mayor Goodell has also been spending thousands of taxpayers dollars on international travel to Asia-Pacific nations in search of these economic drivers.
The agenda report discussed the expenses the City was paying before contract renewal, or a total of $367,484 for pool chemicals and utilities, with the Nadadores paying $237,276 for the remainder of maintenance expenses. Under the amended contract, the City will continue to pay $180,000 for pool chemicals and $60,319 for utilities, plus all other maintenance for the pool, locker rooms, and janitorial services, or a grand total $389,487 annually, with no escalation provision for its expenses. After two one-time payments of $60,000 for utilities for the next two years, the Nadadores will pay $215,273/year, plus a 3% cost escalation factor for each year thereafter. However, for the term of the contract, if the City’s expenses increase over $389,487, the Nadadores will not be required to reimburse the City for any portion of the increase.
The amended contract states that the City shall do all landscape maintenance and replacement; maintain the pools aside from routine vacuuming; keep and maintain all swimming and diving pool equipment including moveable bleachers; and do all major repairs and replacements of broken, malfunctioning, worn or defective equipment (personal property owned by the Nadadores is excluded). The ongoing capital and structural improvements can be very costly. For example, after the $11M total renovation of the Center in 2018, the City had to spend $77,000 for dive tower repairs per its amended FY 2022-23 budget.
The agenda report went on to compare the Mission Viejo’s net cost to operate the Aquatics Center to those in Irvine and San Clemente, with the conclusion that Mission Viejo “serves the most users at a fraction of its price.“ However, the analysis is skewed – it neglects to spell out Mission Viejo’s full cost of running the Marguerite Aquatics Center and revenues it generates. The statistics from the other cities appear to include their full staff costs and user fee revenues. In that comparison, Mission Viejo’s expense total of $565,344 omits the complete cost to run the Marguerite Aquatics Center, which per page 220 of its Proposed FY 2023-25 Budget, is $1,012,690/yr including a .7 FTE employee. There was also no explanation for the $100,243 revenues; it is unclear if it is a minor portion of the contractual amount owed by Nadadores or a portion of the revenues generated by membership fees or other fundraising.
At the September 26 Council meeting, citizens were permitted 3 minutes each to ask questions concerning the amended contract. Two members of the public commented that there was no audit provision in the contract, no escalation clause for the City’s expenses, no standards set for Nadadores expenses for salaries, travel expenses, promotional events, etc. There is no transparency as to how the Nadadores collect and spend their money. There was also no information provided about any independent fund-raising the Nadadores does to support its operations, something that is common for private foundations to do.
Council member Cynthia Vasquez asked several questions concerning the Nadadores contract. As a result, it was revealed that only 40% of the Nadadores members represent residents of Mission Viejo. The City is paying for non-residents to train at the facility in return for undetermined economic benefits. She also suggested that a review should occur yearly or some period less than 10 years because of uncertain factors such as inflation or a pandemic. Before Vasquez could finish her questions, Council member Kelley cut her off by calling the question on the motion to approve the contract.
Despite the comments by some of the members in the audience, Council members Kelley, Bucknum and Reusch decided to approve the contract instead of tabling approval to consider the points raised by the public and Council Member Vasquez. At the end of the meeting, after the vote was taken, Ms. Vasquez explained her remaining concerns, two of which were significant.
With this contract, the Nadadores are now required every 6 months to report revenues, economic benefits and the value the Nadadores provide for use and operation of the Aquatic complex. Ms. Vasquez first asked what accounting standards were going to be used for this report. Her second point was the need to define the City’s responsibility for repairs and maintenance. She used an example of a broken washing machine that has a leak and asked in that circumstance would the City have to replace the washing machine or fix it.
Larger questions include why the City continues too heavily subsidizes a private foundation that serves so many non-residents; charges much more than the City’s other recreation facilities; and doesn’t fully share or offset the full cost to operate, maintain and improve the Aquatics complex.
In summary, the Mission Viejo taxpayers are stuck with a 10-year contract that was approved without sufficient scrutiny and leaves the City open to ever-increasing costs. A first year law student could have drafted a better contract.
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