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Fraud Alleged – At Desert Hot Springs

By   /   April 30, 2013  /   Comments Off

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fraudDesert Hot Springs, CA– When the city handed off $1.4 million to purchase the Jewish Temple on Pierson Boulevard, the city manager did order a structural inspection of the buildings. A few weeks later the building was found unfit for occupancy, leaving the city with a demolition job and mostly vacant lot.

Unable to use the facility for a much needed community center, the city manager floated the idea to move the downtown fire station there and preliminary plans were drawn up. Since several hundred thousand dollars had recently been spent on the old fire station, which was only located a quarter mile away, that idea went nowhere and that plan was abandoned.

It would take another two years for city manager Rick Daniels to concoct a face-saving plan. However his plan got snagged up in red tape when Sacramento made some changes thowing a monkey wrench into his attempt to give away the property. Originally the property had been purchased with public funds managed by the Redevelopment Agency. When Redevelopment Agencies for all the cities in California were disbanded by Sacramento, procedures were established to ensure that public properties were not undervalued or sold off to cronies and insiders but instead sold in a fair process to high bidders.

Ignoring the hold up resulting from dissolution of the city’s Redevelopment Agency, the city manager forged ahead – without approval from Sacramento – and sold the property in December for $250,000; for a loss of over one million dollars.

Municipal Bond

The $35 million Desert Hot Springs municipal bond was passed in 2008. Without complaint the city spent $11 million to improve 80% of city streets and sidewalks, as that was desperately needed.

Another $4 million was spent on downtown facades and streetscaping that has kept the center of the city a ghost town since construction was finished in 2011. Promised economic development never materialized. In fact, there were more businesses in business in the downtown core prior to spending the $4 million.

Yet it was the lion’s share of $17 million from the municipal bond that was used for questionable real estate transactions.

The plan passed by voters was to consolidate small lots in the downtown core in order to sell it all off in one lump sale to a revitalization developer of the shopping center ilk. That did not happen.

Instead properties were purchased by the city manager in a hodgepodge fashion all over town with what turned out to be a slush fund used for real estate purchasing and insider dealing. Properties were purchased during the depths of the economic depression at the highest appraised value, often lacking any negotiation of price, and often involving real estate company carpetbaggers from outside the city who suddenly appeared………..

More  Fraud Alleged – Victorville and Desert Hot Springs.

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About the author

Dean M Gray

Writer, Artist & Publisher. Dean started in the newspaper business at the age of nine earning 90 cents a week walking 3 miles delivering a newspaper door to door. 500 miles later he graduated to a bicycle route. Delivering news evolved into reporting news when he started publishing his first independent newspapers in high school. He served as editor for college newspaper has been published in newspapers and magazines. Dean has been writing his way out of a paper bag and traveling uphill ever since. He is a member of the Society of Professional Journalists and Investigative Reporters and Editors. His publication is Desert Vortex News - http://www.desertvortex.com

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