4/30/25 Money Flows: Sports Marketing Revenue and Kern County's Water Rate Reality

The Moneywise Radio Show and Podcast Wednesday, April 30th BE MONEYWISE. Moneywise Wealth Management I "The Moneywise Guys" podcast call: 661-847-1000 text in anytime: 661-396-1000 website: www. MoneywiseGuys.com facebook: Moneywise_Wealth_Manageme instagram: MoneywiseWealthManagement Guest: Lois Henry, SJV Water website: https://sjvwater.org/

• 0:00Speaker 00

  From the padded radio room off Stockdale Highway, here is Money Wise. Call or text in at 661-396-1000.

• 0:09Speaker 01

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• 0:40Speaker 00

  Now, let's start the Money Wise Show.

• 0:43Speaker 03

  Welcome to the Money Wise Show. We are live from the Gero Ellis padded radio room off Stockdale Highway on ESPN Bakersfield, 1230 a.m., 101.1 FM, and always streaming at MoneyWiseGuys.com. You can call or text into the show 24 hours a day at 661-396-1000. Today, we're your hosts. I'm Sharad Waite and?

• 1:04Speaker 04

  LaTroy Dinkins.

• 1:05Speaker 03

  LaTroy Dinkins, great having you here.

• 1:07Speaker 04

  What's going on, man?

• 1:08Speaker 03

  You know, we're staying busy. You know, we're busy.

• 1:10Speaker 04

  Yes, sir.

• 1:11Speaker 03

  You're busy advising, being a financial advisor, and doing all that financial advising stuff.

• 1:15Speaker 04

  Yeah.

• 1:17Speaker 03

  You know, before I kind of get into the hot topics and the headlines today, I keep pushing this off because I'm so curious about it, but this sponsorship deals in professional sports.

• 1:26Speaker 04

  Yeah.

• 1:27Speaker 03

  I haven't, you know, like you, haven't watched a lot of professional sports, been busy, been doing other things, but recently watched one of the playoff games with the Lakers. They're playing the...

• 1:38Speaker 00

  Timberwolves.

• 1:39Speaker 03

  Minnesota Timberwolves.

• 1:40Speaker 04

  Did they play yesterday?

• 1:41Speaker 00

  They play tonight.

• 1:42Speaker 03

  Tonight. They're down.

• 1:43Speaker 00

  So, they're down 3-1.

• 1:45Speaker 03

  Yeah.

• 1:45Speaker 00

  So, they have to win or they're done.

• 1:47Speaker 04

  LeBron can retire.

• 1:48Speaker 03

  Are you a Laker fan?

• 1:49Speaker 04

  I'm a, yeah, I'm a Laker fan, man.

• 1:51Speaker 03

  Okay. Not a Clippers fan?

• 1:53Speaker 04

  No.

• 1:53Speaker 00

  Or a LeBron?

• 1:55Speaker 03

  Are you a LeBron fan?

• 1:56Speaker 04

  Yeah, I'm a LeBron fan, but he's a, he's playing like La Bum right now, so.

• 1:59Speaker 03

  Ah, he's done pretty good. I think he's averaged over 30 points a game in the playoffs so far.

• 2:04Speaker 04

  That's not good enough LeBron.

• 2:05Speaker 00

  I mean, we, on my other sports show, we, uh, we talked about, you know, going over how LeBron has played this long. You know, a lot of players don't get into the playoffs in their whole career. This guy, if you count all his playoff games, it's two full seasons. Two 82 game seasons.

• 2:24Speaker 04

  That's crazy, man.

• 2:25Speaker 03

  That is insane.

• 2:26Speaker 04

  That's crazy math right there.

• 2:27Speaker 00

  Yes. Well, I mean, I figured you guys would like that since you're the math guys.

• 2:30Speaker 04

  I like it.

• 2:31Speaker 03

  He started playing like right out of high school.

• 2:33Speaker 00

  Yep.

• 2:33Speaker 03

  Right? So he's been, and, and that's also, he's the, is he the number one scorer? Like he passed Kareem Abdul-Jabbar, like the top, most points, uh, career points. Uh, it's impressive. He's 40 or almost 40.

• 2:48Speaker 04

  Yeah, I think he is 40, right? 39?

• 2:50Speaker 03

  It's like, it's impressive to see him, you know, play like he has.

• 2:54Speaker 00

  But he's the all-time leader, but he also played a lot longer.

• 2:57Speaker 03

  Yeah. Well, yeah, I don't know if he played longer than Kareem.

• 3:02Speaker 00

  Not, probably not Kareem, but he's, he's played more seasons than I believe who, who he passed.

• 3:07Speaker 04

  Jordan?

• 3:08Speaker 00

  Yeah.

• 3:08Speaker 04

  Jordan and all his guys.

• 3:09Speaker 03

  I, I was, I, I mean, I was, I guess I'm still a fan of Laker fan, but I was a diehard Laker fan with Kare, in Kareem, when Kareem reached that record and then when he retired and had like every place that he went and played at, they gave him a gift. And they would do a thing and it was really cool to see what he would get.

• 3:26Speaker 04

  He should be holding back, man. He gotta know about sports and the game.

• 3:29Speaker 03

  I know a little bit.

• 3:30Speaker 00

  I, I liked the Lakers when they had Magic and Worthy and I, I loved watching them. I wasn't a fan, but I liked Showtime, so.

• 3:36Speaker 03

  Oh, Showtime was amazing. When they had the three-peat, I was in junior high when they had the three-peat and I remember I had a shirt. I was in it and my dad, we'd go to the Forum, we'd watch the games at the Forum. We even got to the Forum Club a couple of times.

• 3:50Speaker 00

  Right on. Who would've known?

• 3:52Speaker 03

  I took photography class at Actus Junior High and had pictures of, uh, a Laker game that I, that I took. And I would run down to the court and run down to the floor and take pictures. I still have them.

• 4:03Speaker 00

  The good old Forum.

• 4:04Speaker 03

  You're good.

• 4:05Speaker 00

  That's awesome. I gotta see those pictures.

• 4:06Speaker 03

  Yeah, it's cool. Really cool. But what caught my attention in watching this is the, the most recent NBA game are the, the little patches that the players now have on their jerseys. They're about two and a half inch square sponsored logos. And I thought, what is that? You know, what, what is going on there? I even had to look up for the Lakers. It's a company called Bibigo. I don't know if I'm pronouncing it right, or Bibigo? B I B I G O? Which is a, I believe it's a Korean food company.

• 4:35Speaker 00

  Okay.

• 4:36Speaker 03

  Um, they, I was like, what do they pay?

• 4:38Speaker 00

  Oh, it's frozen food.

• 4:40Speaker 03

  Is it frozen Korean food?

• 4:41Speaker 00

  Korean food, yeah.

• 4:42Speaker 03

  Like, uh, and I was curious, how much do they pay to have their name on the Laker jersey?

• 4:49Speaker 00

  Are they that profitable to be paying?

• 4:51Speaker 03

  They must be, but you, what would you guess? So this is like a wild guess, but how much?

• 4:55Speaker 00

  This is tough.

• 4:56Speaker 03

  I'll say it's, it's in the millions. I'll say that.

• 4:58Speaker 00

  For?

• 4:58Speaker 03

  For a season.

• 4:59Speaker 00

  For a season, like just for one team?

• 5:01Speaker 03

  Yeah.

• 5:02Speaker 00

  Yeah, a million or, I don't know.

• 5:04Speaker 03

  Twenty.

• 5:05Speaker 00

  Twenty million. Really?

• 5:06Speaker 03

  Twenty million.

• 5:07Speaker 00

  I was thinking ten.

• 5:08Speaker 03

  It, well, it's, I'm, I'm looking at.

• 5:10Speaker 00

  For a whole season?

• 5:11Speaker 03

  For one season, for one year.

• 5:13Speaker 00

  I mean, that's a lot of games.

• 5:15Speaker 03

  Uh, yeah, eighty something games.

• 5:17Speaker 00

  Yeah. So is it just the Lakers are wearing this?

• 5:20Speaker 03

  No.

• 5:21Speaker 00

  Or the whole NBA?

• 5:22Speaker 03

  I think.

• 5:23Speaker 00

  The NBA started in two thousand seventeen.

• 5:25Speaker 03

  Yeah.

• 5:26Speaker 00

  They started allowing the, the selling of, of sponsorships. A lot of leagues, like, I know it started in like soccer and they've been doing it for a while, but the NBA recently did about five, eight years ago. I know the NFL, we, we were gonna get into this yesterday, but some, you know, the NFL, the big, the big league is not allowing it yet, but I wouldn't be surprised if it's coming. I know they've, they've started doing it with practice uniforms. So like during the off season or, or during camp, they do the same just for side, side cash. But there's a lot of money into this.

• 6:00Speaker 04

  Is it, is it revenue that goes straight to the organization or is it split between the NBA and, and the actual team?

• 6:06Speaker 03

  Well, there, there's both. It goes to the team and then also the league has their own sponsorships. So like the league gets a lot of money from the media, media sponsors and or deals, media deals. But it is, it is interesting that, you know, the Lakers are paying $20 million for this, for this patch, but it's kind of down near the bottom of the list in terms of how much other companies are paying. The number one, the most expensive patch that I could find were the Dallas Mavericks. They're, that company is Chime, which I don't know if that's a fintech. I don't know who Chime is.

• 6:40Speaker 04

  Chime is that online app or it's like a

• 6:42Speaker 03

  It's not Ring, is it?

• 6:43Speaker 04

  It's like a, it's like an app. It's like a money, is it like a money app?

• 6:47Speaker 03

  That's what I'm guessing. It's like a, it's a fintech company because there's, there's quite a few of those. $50 million that they paid their 2023 to 2024 season, the Mavericks paid for that. Then you have the New York Knicks. They pay 30 million a year for experience Abu Dhabi. So like a country like

• 7:06Speaker 04

  Mavericks and the Lakers. Okay. So this

• 7:09Speaker 03

  All the, all the play, all the teams have it.

• 7:11Speaker 04

  The teams have it, but the team organizations are paying for those patches?

• 7:14Speaker 03

  No, the companies pay for the patches and the team allows it to be on their jersey.

• 7:20Speaker 04

  Okay. I thought you said Mavericks are paying 30 million dollars.

• 7:22Speaker 03

  I, I meant the other way. I missed, I misspoke. They're, they're, they're, they're receiving that in revenue as like sponsors, you know, from, from the companies that are paying for it.

• 7:32Speaker 04

  You know, it'd be so dope if, if the NFL allowed it to put a sticker on their helmet somewhere. Kind of like in college football when you got stripes. When you wanted, when you wanted those star players, you get to put those stickers on your helmet.

• 7:42Speaker 03

  Yeah, right. You put like

• 7:44Speaker 04

  Just put a little emblem on the back of your helmet or something.

• 7:46Speaker 03

  Google on there or whatever. Well, it's not anywhere close though, what, what other professional sports pay in other countries and other parts of the world. Formula One leads the pack. They're, they have, and they just landed a landmark 10 year deal valued at a billion dollars to, to make those, those top sponsor for Formula One racing.

• 8:11Speaker 04

  That's their whole revenue.

• 8:12Speaker 03

  Yeah.

• 8:13Speaker 04

  It's your sponsorship.

• 8:14Speaker 03

  Yep. Yeah, I think that is.

• 8:15Speaker 04

  That's not a surprise at all.

• 8:16Speaker 03

  Formula One, I think, receives their most from sponsorship deals.

• 8:20Speaker 04

  Yeah.

• 8:20Speaker 03

  Their sponsor is LVMH or Louis Vuitton, paying a billion dollars over 10 years for that. And then you have other, you know, world leagues that really pay and receive a much higher percentage of their revenues from these sponsorships. So, for example, in the NBA, or in NBA, NFL, Major League Baseball, it's between 8 and 15% of the team's revenue comes from sponsorship revenue.

• 8:52Speaker 04

  That's not bad at all.

• 8:53Speaker 03

  Compare that, though, to European clubs, and it's much higher. It's closer to 30 to 40, sometimes 45, up to 45%.

• 9:07Speaker 04

  You're talking about like international soccer, football teams, right? So, I always wonder, you know, Stephen, you probably looked this up real quick, but what's the capacity of soccer stadiums versus like, you know, NFL stadiums? Like, it'd be a lot of games, like, they'd be packed out.

• 9:23Speaker 03

  Yeah, you know, that's interesting that European soccer clubs only receive about 20% of their income from ticket sales.

• 9:30Speaker 00

  Really?

• 9:31Speaker 04

  Wow.

• 9:32Speaker 03

  And NBA, it's a little bit more. Yeah, that's right.

• 9:36Speaker 00

  Soccer fields is anywhere from 80 to 130,000 compared to 50, 60 in NBA and stuff like that.

• 9:43Speaker 04

  So they sell cheaper tickets probably than soccer.

• 9:46Speaker 03

  Yeah. The NBA receives 20, 25% of its total annual revenue from tickets. NFL's 15 to 20%. European soccer clubs is 15 to 25%. And it's pretty much across the board. They're all even with licensing and merchandise, you know, selling jerseys and things like that. But the media rights, that's where the American professional teams get a lot more of their revenue. 40 to 50% of their revenue comes from media rights compared to 30 to 40% for European soccer clubs.

• 10:16Speaker 04

  Gotcha.

• 10:17Speaker 03

  So, but European soccer clubs get a lot higher percentage of their revenue from sponsorship. So they've They've already been selling like their whole jersey will be an ad.

• 10:25Speaker 04

  Yeah.

• 10:26Speaker 03

  Like the it's just like the team has like a the jersey just looks like an ad.

• 10:31Speaker 04

  Yeah.

• 10:31Speaker 03

  Basically, the NFL is is still the lowest at 10%, less than 10% comes from sponsorships.

• 10:38Speaker 04

  That's crazy.

• 10:38Speaker 03

  Yeah.

• 10:39Speaker 00

  I've I've seen a lot of it with like boxing and UFC, even with the NBA playoffs. I've recently seen like how it'll be a digital ad on the court, but when the players step over it, they're, you know, it disappears.

• 10:51Speaker 03

  Oh, yeah.

• 10:52Speaker 00

  Oh, okay. So now not only is the league allowing teams to sell advertising on their jerseys and their gear, but now the TV is doing the same thing with the courts.

• 11:04Speaker 03

  Yeah.

• 11:04Speaker 00

  And like the UFC fights, you can see on certain parts of the ring, there's certain sponsorships and it changes in different matches. So it's like they're selling multiple advertising. They they found a way to sell each match instead of the whole fight. So I mean, they're they're making they're making money. They're finding different ways to utilize the digital side as well.

• 11:26Speaker 03

  Yeah.

• 11:27Speaker 04

  Yeah, and those those are sports that really need the sponsorship, too.

• 11:30Speaker 00

  Yes, 100%.

• 11:31Speaker 03

  The Formula One receives about 70%. It generates about 70% of its revenues from sponsorships. Which is like way more than the NBA at, you know, roughly 15% and European soccer league.

• 11:46Speaker 04

  I'm gonna have to start a kickball league out here in Bakersfield. Maybe we could get some sponsors.

• 11:50Speaker 03

  Yeah, I I'd join that. I could play kickball.

• 11:52Speaker 04

  Get like maybe, you know, 10, 11 teams of adults that that could raise their foot at least and.

• 11:59Speaker 03

  And we could we could offer sponsorships to like like local companies.

• 12:02Speaker 04

  I'm serious.

• 12:02Speaker 03

  Charge, charge, charge them for a for a patch on our jerseys. That'd be fun. That would be really fun, actually. So I I wanted to bring that up. I, you know, I got a couple of sports guys here and it's always fascinating.

• 12:16Speaker 04

  What about the markets, though? What's going on?

• 12:17Speaker 03

  Yeah, let's talk about the markets. Um, we'll we'll take a break first. When we take a break, when we come back, we're gonna we're gonna cover the markets because we still are waiting for Lois, right? We're gonna have Lois Henry on too later in the show. We're gonna talk about what's going with water and these rates going up. Plus the water, plus the water in the river. Much more to talk about. Don't go anywhere.

• 12:36Speaker 00

  Are you an employee with a company sponsored retirement plan? Do you fully understand how you're invested and whether or not you are maximizing your retirement plans options? For more information on a free assessment, contact MoneyWise's 401k specialist, Justin Leland at 661-847-1000. That's 661-847-1000.

• 13:09Speaker 03

  Welcome back to MoneyWise. We're live taking your questions and comments. I'm Sherrod Waite, your host, along with Latroy Dinkins. This is a momentous day today in the markets, Latroy.

• 13:23Speaker 04

  Yeah.

• 13:24Speaker 03

  There is, this is the longest winning streak that we've had this year. We're now on day six of barely squeaking out a positive gain. Markets were trading negatively all day until the very last end of trading the S and P 500 and the dumb Dow ended squeaking out tiny gains. But what's interesting is we're still facing the uncertainties basically surrounding the tariffs and what changed the course of the markets. I don't know if you read this, but they found out that there was a Chinese social media account that's affiliated with a country state run channel that posted a comment that the US has been reaching out to them

• 14:09Speaker 03

  seeking to negotiate on tariffs.

• 14:12Speaker 04

  So, okay, yeah, that's not good.

• 14:15Speaker 03

  Isn't that crazy?

• 14:17Speaker 04

  That's crazy.

• 14:17Speaker 03

  It's like, oh, oh, there's a rumor, but it's not a rumor, but there's a social media post, a Chinese social media post from a supposed government agency that says, oh, the US is wanting to negotiate with us. It's like, oh, what?

• 14:33Speaker 04

  Maybe market manipulation or something? I don't know.

• 14:35Speaker 03

  Maybe. Yeah, there's definitely gotta be some of that going on.

• 14:39Speaker 04

  Well, I'm a little optimistic because I mean, you just introduced me to the zleague, breath thrust.

• 14:46Speaker 03

  This week breath thrust. It's such a terrible day. We talked about it a little bit yesterday.

• 14:51Speaker 04

  Yeah.

• 14:51Speaker 03

  Yeah, it's it's been accurate 19 out of the past 19 times. And then it just happened for the 20th time. Was it last week?

• 15:00Speaker 04

  Yeah, last week.

• 15:01Speaker 03

  And essentially, it's kind of hard to explain.

• 15:03Speaker 04

  Well, basically, what it is, is like the market, the S and P 500 rises real sharply. And in that rise, they noticed that 60 like 60% of all stocks within S and P 500 are building momentum. So it's like a meter that measures. Okay, right now, you know, early on during the year, it was less than like 40% of stocks were not really performing or just really, you know, down.

• 15:32Speaker 03

  Yeah, yeah. The way I understand it is if you have a group of stocks in or a part of an index where it moves from 40% up to just above 60% of of advancers versus decliners in a 10 day window.

• 15:47Speaker 04

  Yeah.

• 15:48Speaker 03

  Then that's what has preceded that 19 out of the last 19 times. It happens about every five years or so. But going back to World War II, what has preceded that in the following year has been on average of 25 or 26%.

• 16:02Speaker 04

  Yeah.

• 16:02Speaker 03

  Annualized return. I think it's almost always positive after 12 months.

• 16:06Speaker 04

  After six, it can be anywhere from six to 12 months. Yeah.

• 16:10Speaker 03

  So what's crazy about these, I know you you're kind of you're more of a technician than I am. You enjoy the the trading aspect to it. But my complaint to the technical trades has always been that they're only as good, they're only good until they're no longer good. Which they're not like, they're not golden rules that are always going to come into play because trends kind of change and you never know when that's going to be. Therefore, it's really unreliable.

• 16:36Speaker 04

  Very unreliable because, I mean, I don't know, you just introduced me to this week breath thrust. But I know back in 22, you know, we we made a higher high in the market like early on when we was going through that little crash in 22 and everybody was very optimistic. And then guess what? We rolled back over. So like you said, like, when you're looking at the charts, this actual fact until it's not. You know, things are good until it's not. Once you see it that is evident, then, you know, so.

• 17:01Speaker 03

  Yeah, like if there's enough traders that are like following a certain technical in um indicator.

• 17:09Speaker 04

  Yeah.

• 17:10Speaker 03

  Then it can it can start to skew it or mess it up. So it no longer works anymore. There's lots of reasons why a technical indicator no longer is reliable, which is why what's the legal

• 17:22Speaker 03

  words that we have to say or put when on our on statements. Past performance is no.

• 17:28Speaker 04

  Is not uh.

• 17:29Speaker 03

  No indication of future guarantees or future performance.

• 17:33Speaker 04

  Yep.

• 17:34Speaker 03

  And you know, past performance or past indications, no, no guarantee or doesn't mean it's gonna happen. Doesn't mean it's gonna happen again.

• 17:43Speaker 04

  It's and technical analysis in itself is like you said, technical indicators, it's a bunch of fluff, but people look at tech technicals to manage risk. That's it. Simple. Simple as that.

• 17:53Speaker 03

  What? What do you mean?

• 17:55Speaker 04

  To to manage risk, like if if a stock is like there's there's certain strategies out there where, you know, if a stock, for instance, there's what's called tactical portfolios where if a stock falls below a 200 moving average, then you know, they'll get out of that position and and rotate their money into a different, you know, sector. Um, things of that nature, like just to mitigate risk. And the only way they're able to see that is by looking at technicals.

• 18:19Speaker 03

  Yeah.

• 18:19Speaker 04

  Technicals wasn't meant to be like a fortune teller.

• 18:21Speaker 03

  Yeah.

• 18:22Speaker 04

  It was meant to say, okay, I'm here. This is the the health of the market right now. But the minute that, you know, something happens, then we could rotate into another sector based on price action.

• 18:31Speaker 03

  Yeah, almost like a a stop loss.

• 18:33Speaker 04

  Exactly.

• 18:34Speaker 03

  Stop stop loss uh procedures was real common in brokerage accounts where you say, look, I'm gonna buy a stock at at $50 a share, but if it drops down to $30 a share, I'm gonna sell. You know, or if it goes up to $80 a share, I'm gonna sell.

• 18:48Speaker 04

  Yeah.

• 18:49Speaker 03

  Um, and so.

• 18:50Speaker 04

  Guardrails.

• 18:51Speaker 03

  Guardrails.

• 18:52Speaker 04

  Yeah.

• 18:52Speaker 03

  You have a big besides the, you know, the Chinese social media post today is a big day because we have our GDP numbers came out today. And the core index, the core inflation numbers came out today. So both of them, bad news, which is really surprising to me that we saw the markets end up in positive territory because we've now are officially in a negative GDP for the first quarter.

• 19:17Speaker 04

  Uh oh, that's one quarter.

• 19:18Speaker 03

  One quarter.

• 19:19Speaker 04

  We're one quarter away if we get another negative number.

• 19:21Speaker 03

  Then we, then it's really, now we're officially in a recession.

• 19:25Speaker 04

  Yeah.

• 19:26Speaker 03

  The, the, you know, the big one being the GDP numbers, which were expected to drop to 0.1%, they dropped to 0.3% in the first quarter of this year.

• 19:38Speaker 04

  Wow.

• 19:39Speaker 03

  So that's a, that's a retraction of 0.3%.

• 19:41Speaker 04

  Yeah.

• 19:42Speaker 03

  So worse than what was expected. And compared to the fourth quarter of last year, so the previous quarter was 2.4%. So we went from 2.4% growth to a negative 0.3%.

• 19:56Speaker 04

  And I, and I'm gonna say this, I don't think it has anything to do with tariffs because it's like, that, that number is kind of like a lagging number, right? If GDP is all based off of, like, like what, three months, six months ago?

• 20:10Speaker 03

  It was the first quarter, so the first three months of this year, so.

• 20:13Speaker 04

  But those prices then like just all of a sudden just hit, you know?

• 20:17Speaker 03

  That's right. Yeah, because Trump didn't take office till end of January.

• 20:20Speaker 04

  Exactly, yeah.

• 20:21Speaker 03

  It's just going in 100 days now.

• 20:22Speaker 04

  Yeah.

• 20:23Speaker 03

  Of his, of his presidency and, but what it, and what the economists are stating is it's just the uncertainties of his tariffs were enough to disrupt business. The fact that companies were now, they were forced to plan for the potential of the tariffs that he started talking about, and they started, they started kicking in in March. So there was at least that last month of the first quarter.

• 20:49Speaker 04

  So you think the last month had disrupted that bad?

• 20:51Speaker 03

  Yeah, 100%, 100%. And the beige book came out, um, last, I think it came out last week, and the beige book is the Fed's. Sort of analysis, not analysis, but they're, it's like a survey of how, how business leaders and companies are feeling in their different regions around the country. And the beige book said the same thing, like it's definitely disrupt businesses, the uncertainties behind what could happen with tariffs. So I think it definitely had a play. I think it definitely had an impact.

• 21:25Speaker 04

  Well, that's, that's very instantaneous considering GDP numbers are usually like, like lagging a little bit.

• 21:31Speaker 03

  Yeah.

• 21:32Speaker 04

  Like right now, we, you know, tariffs came, came about like, like you said in March. So what, what does the future behold, you know, with, with the full quarter of, you know, going through this, you know?

• 21:42Speaker 03

  It's, it's a little scary, I think, because now we're a third of the way through the second quarter and I don't think it's gotten any better in, in April.

• 21:51Speaker 04

  Yeah.

• 21:52Speaker 03

  There's, you know, the tariff, we still have 140 something percent tariff on China.

• 21:56Speaker 04

  Yeah.

• 21:57Speaker 03

  And, you know, everything else is, is up in the air. And then we have, you know, we're looking now today, the numbers coming out for the core personal consumption expenditures index. This is the, the Fed's most respected or followed inflation gauge. It grew by three and a half percent in the first quarter and it was only estimated to be 3.2 percent. So it's pretty substantial, about 10% higher than what, than what analysts were expecting. And it's, the, the previous quarter was 2.6%. So we had 2.6% inflation, the end of last year, the beginning of this year, it went up to three and a half percent. So that's a, that's a big jump.

• 22:39Speaker 04

  It is.

• 22:40Speaker 03

  In inflation. And that doesn't help consumer confidence or investor, investor sentiment.

• 22:46Speaker 04

  Definitely not, yeah.

• 22:47Speaker 03

  And this is also very busy week for earnings reports. I think it's one of the busiest weeks, over 150 companies of the S and P 500 are reporting this. This week.

• 22:59Speaker 04

  They have major implications on the market.

• 23:01Speaker 03

  Huge. And what we're seeing so far actually isn't too bad. Microsoft, Meta, both announced better than expected earnings today. And we've had other big companies report their earnings that haven't, haven't, at least I haven't seen them being too terribly bad. GM, there were a lot of surprises there. They had to really revise down their expectations and they said specifically it was because of tariffs and the uncertainties that come, even though it's an American company, but so many of these parts are manufactured across the world. And, and so, you know, there we have it. This is, this is a busy day. If this indicator though is right, we're gonna be alright.

• 23:43Speaker 03

  I seek, I still will, I'm a strong believer in the US stock market as continuing to, to lead the world and that the long-term prospects, like I'm, you need to think years ahead. And if you're, if you're able to have years to ride this out, you should be excited about some of the deals that there are, that there is happening in the markets. And that means if most people are dollar cost averaging, money coming out of their paycheck. So they're buying into a lower market right now and that will, that really helps. That really helps in the long run. It doesn't help for you to worry or freak out too much about what's going on in the short run. So hopefully this is, this whole tariff stuff is just a speed bump.

• 24:27Speaker 03

  It's not a, like a major catastrophe.

• 24:30Speaker 04

  It's not a toupee.

• 24:32Speaker 03

  Yeah, hopefully. And that's my, that's my prediction is that, that, you know, we're going to get through this. We'll get through this period of uncertainty and then, and hopefully we're back on track. We'll find out. Alright, time for another break. When we come back, we're going to be joined by Lois Henry. She's a regular guest that we have on the show. She knows her stuff about water. And there's been a ton of water in the news. She is the CEO and editor of the, of the SJV Water publication. We'll be right back with Lois Henry.

• 25:01Speaker 00

  Are you nearing retirement and currently working with a financial advisor? Are you not sure if you're invested appropriately? Call our offices at 661-847-1000 to sit down with a MoneyWise financial advisor for a no obligation assessment.

• 25:20Speaker 03

  Welcome back to MoneyWise. We're your hosts. I'm Sharad. That's Latroy. That music means Lois Henry is here playing air drums. AC/DC fan, huh?

• 25:28Speaker 00

  She must be in a good mood. She's rocking out today.

• 25:31Speaker 05

  I'm never in a good mood, Stephen. Don't make that mistake, ever.

• 25:35Speaker 03

  You are the local water expert and watchdog, I believe. You take that title?

• 25:43Speaker 05

  I try and keep up. Believe me, so much is going on with water and it's so complicated. I don't consider myself an expert at all.

• 25:50Speaker 03

  You got your earpiece there, funny. There you go.

• 25:52Speaker 05

  Because this is made for people with giant heads.

• 25:56Speaker 00

  They do adjust.

• 25:57Speaker 03

  It's okay.

• 25:58Speaker 05

  I can't make it any smaller.

• 26:00Speaker 03

  No, it just flips like this. Flip it over. You're like this. So if you just turn it like that, it'll go.

• 26:05Speaker 00

  I'm gonna get you a Walkman.

• 26:06Speaker 03

  You can leave it.

• 26:08Speaker 00

  I got you.

• 26:08Speaker 05

  I need like how, you know, girls back in the day, they would put like tape around their boyfriend's like high school classroom. I need tape on the top of this. So it holds up like this.

• 26:18Speaker 03

  Oh, I see. They put tape on so it wouldn't fall off their fingers. Okay, we can do that.

• 26:22Speaker 05

  The world of girls, the stuff about the world of girls that you don't know that goes on.

• 26:28Speaker 03

  Well, just class rings is a thing.

• 26:30Speaker 05

  Is that it? The rest you know all about, girls? Yeah. I know all about women. Yeah.

• 26:34Speaker 03

  No, I definitely don't.

• 26:35Speaker 05

  Shared weight, folks, if you have questions.

• 26:37Speaker 03

  I definitely do not. I don't even want to pretend I know a fraction of what should be known. But great to have you here. Talk about water. Let's talk about the biggest... I mean, there's really two big stories. The river and the lawsuit that's going on with the Kern River and for water to run through the city. But the other one being that I don't know how many people are aware of this, but you did write about it. It showed up in the Bakersfield, California on April 22nd, April 24th, and it was about the...

• 27:09Speaker 03

  Upcoming increase in people's water bills.

• 27:13Speaker 05

  Right. I actually wrote about this in March 13th, on March 13th.

• 27:16Speaker 03

  Oh.

• 27:16Speaker 05

  If you go back, this is why you need to like, keep track.

• 27:19Speaker 03

  I know.

• 27:19Speaker 05

  And the Californian did run it, but it just didn't get on people's radars that the Water Board, which is a committee of the council, the city council, and you have to understand, Bakersfield City has its own water purveying system. But it's, it's very confusing because the day-to-day operations of it are run by Cal Water and the billing comes from Cal Water. So people get very confused. Cal Water is the, is the majority, largest server of water. But I think it's 165,000 residents or households get their water from Bakersfield City. Okay, so.

• 27:54Speaker 03

  It's Bakersfield City's water, but it's being operated by Cal Water?

• 27:58Speaker 05

  Yeah, like the day-to-day type operations, you know, making sure that they have enough pressure in the system and things like that. So they have a contract, right? And billing.

• 28:06Speaker 03

  Yeah.

• 28:06Speaker 05

  But it's Bakersfield's water. So when a municipality decides that they need to raise their rates, they have to do what's called a Proposition 218 election. So they have to go through this whole system because you can't just raise rates, which are considered taxes under Proposition 218, on people without their input anymore. This was decided, and the Proposition 218 was passed in the late 1990s.

• 28:28Speaker 03

  Oh.

• 28:28Speaker 05

  So a Proposition 218 election, sorry to get into the weeds with you, but it's very important to understand this because this process is now on the train tracks and is moving. So a Proposition 218 election doesn't mean you, everybody gets to vote yes or no. It is, oh, this notice goes out and if we don't, we, the agency, don't get a majority of protest letters, meaning 51% of eligible voters send us a protest letter not to do this, then it passes.

• 28:59Speaker 03

  Wow.

• 28:59Speaker 05

  So here's the thing. With water rates, with sewer rates, all that kind of stuff, a lot of it, you know, I don't, I don't know too many people who anymore open their mail and write a check. They don't, they, they have it either auto pay or they just like.

• 29:13Speaker 03

  From their escrow and their mortgage bill.

• 29:14Speaker 05

  Right. Yeah, it's all, it's all part and parcel with that. So people don't really check it that much. So I wrote about this.

• 29:22Speaker 05

  Because like I said, the process has to be, you know, very specific. So the water board is a committee of the city council and they had a water board meeting, March 12th. I attended and they said, yes, we want to increase the sewer rates, which are an annual fee on your property tax. They are currently $239 a year. It's extraordinarily low and have been left low for many decades, ridiculously. It should have been looked at like, oh, we need to, we need to keep up with infrastructure. We need to keep the fees going. Well, they didn't. Okay. So here we are. They need to raise it to $950 a year.

• 29:57Speaker 03

  So 300% increase on the sewer rate.

• 30:00Speaker 05

  I love how you did that really quickly.

• 30:01Speaker 03

  Well, you wrote it.

• 30:02Speaker 05

  Okay. You know how long it took me to like, figure that out? Like, ah, you figure a percent increase?

• 30:06Speaker 03

  Carry the zero?

• 30:07Speaker 05

  Yeah. What do I do with the dot?

• 30:10Speaker 03

  Well, this is, this has been well known. We talked about this on the show. I actually referenced your article about it because people were losing their minds.

• 30:17Speaker 05

  Right.

• 30:17Speaker 03

  You know, they're like, they were getting the letter.

• 30:19Speaker 05

  Right. They, they didn't. It's so interesting. So I wrote about it, uh, March 13th and then it has to go to the council. The council approved, holding the 218 elections, one for the sewer rate and one for the water rate. Now, I, I, I thought the sewer rate, like, hey, man, that's been low, too low, too long. That, I mean, the percentage is outrageous, but that didn't disturb me so much as the water rates. But nobody has paid attention to the water rates. In 2022, the city council approved increasing water rates for like a five-year period, right? So 2022, they went up, 2023, 2024, they went up. Now, they said,

• 30:52Speaker 03

  Yeah. Now they're like, oh, but we needed, we needed those rates to be higher anyway.

• 30:56Speaker 05

  So now we're going to, we're recommending a five year. So that's going to end up being seven years of rate increases.

• 31:02Speaker 03

  Yeah.

• 31:02Speaker 05

  Um, to take it up 51%.

• 31:05Speaker 03

  From where it is this year?

• 31:07Speaker 05

  Yeah. And the first rate jump will be 34%.

• 31:10Speaker 03

  Yeah.

• 31:10Speaker 05

  I'm like,

• 31:11Speaker 04

  It's a front loaded, uh, jump.

• 31:13Speaker 05

  Right. So it's like, whoa, people are just going to, they don't, you know, they paid attention to that 300 and some percent increase on the sewer thing, but they've been increasing fees on the water rates and they've been getting this money and it's not like the same, you know, huge lag time. So I was like, man, to me, that seemed a little bit more outrageous. But what, what can I say?

• 31:32Speaker 03

  So the average bill, average residential bill in the city is going from $43 to about $54 this year, eventually up to $64.

• 31:44Speaker 03

  And so that's a, that's a pretty substantial, it's about over $20 a month increase is going to hit a lot of people.

• 31:53Speaker 05

  Right.

• 31:53Speaker 03

  Is it going to go beyond that? That's, that's where it'll, that's where it'll max out.

• 31:57Speaker 05

  That's where it'll max out for then. I mean, who knows what will happen in the future.

• 32:01Speaker 03

  Why?

• 32:02Speaker 05

  So here's the thing, though, when you think about that, because I didn't think about it in monthly costs. I just looked at it as a yearly cost of $950 as opposed to 239. That actually adds 80 bucks a month. If you're looking at it as, you know, your monthly.

• 32:13Speaker 03

  Oh, yeah.

• 32:14Speaker 05

  So your sewer rate is going up by 80 bucks a month. And then your water rate is going up too. So I, you know, it was a double whammy.

• 32:22Speaker 03

  Yeah. It's a definite double whammy. I can understand the increase. Basically, it seems like city council over the last 30 years has just kicked the can down the road. Like, we, we know we're going to have to repair these or upgrade our sewage, our water treatment.

• 32:35Speaker 05

  Now it's, now it's a 500 to 600 million dollar fix.

• 32:38Speaker 03

  Yeah.

• 32:38Speaker 05

  As opposed to 10 million every year to repair and replace things. Yes, it's huge.

• 32:43Speaker 03

  It's a big, that's a big cost. But I'm not, I'm unclear on why the cost for the water.

• 32:49Speaker 05

  Well, that's an interesting question.

• 32:51Speaker 03

  It seems, like, I pay, I pay more than that. I'm, I'm part of the Vaughan.

• 32:55Speaker 05

  Right.

• 32:55Speaker 03

  Vaughan Water Company.

• 32:57Speaker 05

  Yeah, everybody, everybody in town pays more than the city people do. Because the city municipalities are only legally allowed to charge how much it actually costs to get the water out, treat it, and get it to you. They cannot do anything more than that as opposed to like Cow Water is a for-profit utility, so it can build in 12% profit margin for capital improvements. Vaughan is a mutual water company.

• 33:21Speaker 03

  Yeah.

• 33:21Speaker 05

  They can create a reserve fund. They, they're actually, mutual companies are overseen by the business, State Department of Business Administration. And then there's CSDs, Community Services Districts, like East Niles, and they have their own rules. But the city can only legally, they can't do like tiered pricing in order to push you to not use as much water. You know, there, there's a lot of things that they have to really kind of adhere to.

• 33:48Speaker 03

  I see.

• 33:48Speaker 05

  So that's why their prices are so low, and they're always going to be lower than anyplace else, but they have to match what it costs to run the system.

• 33:57Speaker 03

  Yeah. Right.

• 33:58Speaker 05

  Anyway.

• 33:59Speaker 03

  So that must be, there must be increased costs in running the system.

• 34:01Speaker 05

  So it's interesting you mention that. Do you have time for me to go on my rant?

• 34:05Speaker 03

  Yeah, yeah, what is it?

• 34:06Speaker 05

  Can I rant?

• 34:06Speaker 03

  Yeah.

• 34:07Speaker 05

  Okay, so at this-

• 34:08Speaker 03

  No swear words.

• 34:09Speaker 05

  Dang it!

• 34:10Speaker 03

  Have to wait till off the air.

• 34:12Speaker 05

  Okay, I'll try to do it without swear words.

• 34:14Speaker 03

  Okay.

• 34:14Speaker 05

  It's really taxing me. At that March 12th Water Board meeting, the city staff said, "Oh, we need this water rate increase because we have, we paid for, we, taxpayers, paid for this sort of survey to look at 10-year, what we need 10-year infrastructure plan." Right? And so they showed a couple of slides from this 10-year plan. It wasn't in the packet, the agenda packet. So I was like, huh. So I go up to them later and they vote on it. They're like, "Oh, well, we need all this stuff." Oh, my gosh, right? So based on, you know, this information that was provided verbally in one or two slides, they said, "Yes, we're going to go ahead and recommend to the city council that they start a Prop 218 election of 51% rate increase." Okay, great. I go up to the staff later and like,

• 34:57Speaker 05

  "I'd like to get that 10-year infrastructure plan." It's in draft, you can't get it.

• 35:03Speaker 03

  What?

• 35:04Speaker 05

  And I was like, "Well, first of all, the California Public Records Act actually says that you can give me a draft document. You don't have to. You're not compelled under the law to give it to me, but you can. And I'd like it since these people just voted to tax people, you know, or to increase their rates by 51%. I think it's kind of important. I'd like to see what that list says."

• 35:21Speaker 03

  Yeah.

• 35:22Speaker 05

  Well, you're going to have to do a Public Records Act request.

• 35:24Speaker 03

  Oh, boy.

• 35:24Speaker 05

  So I do a Public Records Act request. And it came like, it came within the time period, but by then, I'm on to something else, right? I'm like, too busy to look back at it. So finally, I get it and I look at it and I'm, and I noticed that there's a $6 million need for a consolidation pipeline. Bakersfield has been mandated by the state to consolidate with two failing systems in the south, like, south of Independence High. And that costs a lot of money. You've got to get a pipeline to them. You've got to make sure they have treated water, blah, blah, blah, blah. You have to make sure you have capacity. It could involve, you know, having to drill an extra well, although I don't think so because it's only like 40 connections total. So I was like, huh, that's interesting. Well, they had a-

• 36:06Speaker 05

  A special meeting on April 23rd, which I couldn't attend, I had to send a freelancer, but her story said that they were talking about this consolidation. I was like, oh, that's interesting. And it's going to cost 7.7 million dollars total, the whole consolidation. Legal fees, engineering fees, physical, everything, 7.7 million dollars that the state is going to completely reimburse the city for.

• 36:27Speaker 03

  Oh.

• 36:28Speaker 05

  So.

• 36:29Speaker 03

  So we shouldn't have to pass that on to the taxpayer?

• 36:31Speaker 05

  So I said, hey, because you can't like call anybody at the city of Bakersfield and like get them on the phone, you know, like a department head who makes 200 and some thousand dollars. You can't go, hey, expert who's running this department, can you answer me a couple of questions? You can't do that. You have to go through their, whatever. It's just ridiculous. They've, they've hired a phalanx of PIOs, public information officers and, you know, that you can't get the city attorney, the city manager's office is like a freaking bunker with all their new deputy city managers. And by the way, our homeless is still out of control, but whatever. I told you I was going to go on a rant.

• 37:07Speaker 03

  Yeah, I hear you.

• 37:07Speaker 05

  So I sent an email, because I'm stubborn as hell, and I sent an email to the department head of the water department going, wait a minute, what about this 6 million dollars that's on your 10-year infrastructure plan that I had to do a public information act to get?

• 37:20Speaker 03

  Yeah.

• 37:22Speaker 05

  I thought that was all going to be reimbursed by the state. Can you tell me if this is different or something, you know, there's some reason that are they leaving off 6 million dollars for this? Because according to your meeting that you just had, you're getting 7.7 million dollars from the state for this. So how is this part of the, the thing? And just, you know, anyway, so.

• 37:39Speaker 03

  Yeah. And?

• 37:40Speaker 05

  As of yet, no, no response.

• 37:42Speaker 03

  No answer?

• 37:43Speaker 05

  No response. I'm so mad at the city of Bakersfield. The whole thing just needs to be ripped up, torn away and just put, put back together.

• 37:48Speaker 03

  What do you mean, the, the city administration?

• 37:51Speaker 05

  Yes. The council, every, they're just like asleep at the wheel.

• 37:55Speaker 03

  I have, I have a lot of sympathy for the council because they're essentially volunteers. They are volunteers. They barely get a little stifled.

• 38:03Speaker 05

  Then why do they fight to get on those seats? Don't, don't have sympathy for the devil.

• 38:07Speaker 03

  Well, okay.

• 38:09Speaker 05

  Politicians are politicians are politicians.

• 38:11Speaker 03

  Yeah, the city council's a little different. At least our city council, I believe. If they got, if they were actually paid where they didn't have to have like a real job, then I would be, I would feel a little different, you know? And there's a lot of city council members, there's some that want to move up, you know, they want to become supervisors or they want to go to the assembly or whatever.

• 38:30Speaker 05

  Let's look at the percentages.

• 38:31Speaker 03

  Yeah.

• 38:32Speaker 05

  And who reps them? Who gets them on city?

• 38:34Speaker 03

  Yeah.

• 38:35Speaker 05

  I mean, you know.

• 38:36Speaker 03

  There's some devils in there.

• 38:37Speaker 05

  It's not like they're just like, oh, you know.

• 38:40Speaker 03

  Yeah.

• 38:41Speaker 05

  Andy Taylor from Mayberry. Oh, shucks. I'll serve.

• 38:43Speaker 03

  Some of them, some of them.

• 38:45Speaker 05

  They've got heavy duty campaign people pushing them.

• 38:48Speaker 03

  We don't have any other choice when they don't get paid. Like, how, who else are we gonna expect to be on there?

• 38:53Speaker 05

  People like me ought to be in their ear at all times.

• 38:55Speaker 03

  I agree. That's why I say you're a great watchdog. That's why we need you. Our community needs you. Latroy.

• 39:00Speaker 05

  Latroy had something.

• 39:01Speaker 04

  Yeah, I was gonna say, um, Proposition 218, if that passes, is there some sort of alternative measure to be able to fund like the infrastructures and?

• 39:11Speaker 05

  Oh, yeah, they can bond for it.

• 39:12Speaker 04

  Like municipal bonds?

• 39:13Speaker 05

  Yeah, which means we'll.

• 39:15Speaker 04

  What about sales taxes and things of that nature?

• 39:17Speaker 05

  No, no, no, no.

• 39:18Speaker 03

  No, the only other way is they can borrow money by issuing bonds.

• 39:22Speaker 05

  Which is more money for us. So.

• 39:24Speaker 03

  Yeah, it costs us more money in the end, right? Because we have to pay interest and.

• 39:27Speaker 05

  Right. So $10 million becomes whatever, $17 million over because of interest.

• 39:32Speaker 03

  And we're still paying it. Like, you're still having, you're seeing a bond on your property tax bill or on your, yeah, on your, on your property tax bill is going to show, you know, water bond.

• 39:41Speaker 05

  So.

• 39:41Speaker 04

  What's the sentiment, what's the sentiment right now? Like, is it looking like it's gonna pass or?

• 39:46Speaker 05

  Well, so like I said, the backlash on the sewer rate was so vociferous that the, the recommendation at the last council meeting from Christian Clegg, the city manager, was to, um, like, like, I recommend, who listens to this guy? Anyway, he recommends that the city council rescind the Prop 218 election, but it wasn't noticed on the agenda. All of a sudden, you know, oh, my gosh, and let me tell you this. Anyway, so you have to have it noticed so that the public, there's a whole reason you have things noticed so that the public and that, and you have it in your agenda packet. So the public can participate in their own governance.

• 40:21Speaker 05

  Somebody at the city council might want to listen to that. Ginny Gennaro does. But anyway, so they recommended the council rescind the 218 election, but that has to come up at another city council meeting. It has to be properly agendized and noticed. And then they have to vote on it and people can have their say at it. So it's not a done deal. People think, oh, we beat back the sewer rate. No, they did not. It is still in process. And by the way, the water rate increase is a separate 218 election.

• 40:46Speaker 03

  Yeah.

• 40:47Speaker 05

  So that is still on the tracks. That train is still moving.

• 40:50Speaker 03

  My understanding is those letters have not gone out yet, or they're going out like this week.

• 40:54Speaker 05

  They went out, people started getting them because if you look at, if you're on Nextdoor, people are going nuts again.

• 40:59Speaker 03

  Like they did with the sewer one, it's a separate letter.

• 41:01Speaker 05

  Yeah, it's a separate letter. It's a separate election. That, um, and here's this, the city, um, sent me, one of their P I Os sent me, because I'd been asking, you know, like, when are these letters going out? What's happening with the water rate increase? And sent me a note saying, oh, we've decided not to send those notices out. And I was like, wait a minute, the council didn't say that that was going to be rescinded too. You have to vote on it. I mean, there's, there's a legal.

• 41:25Speaker 03

  Procedure that they have to go through.

• 41:26Speaker 05

  If you're going to have the hearing on June 11th, you have to send those notices, like, I don't know, six to 12 way. Yeah, some, you know, so that people can know what's happening.

• 41:35Speaker 03

  Or they can write back, right? And if 51% write back and go, no way.

• 41:38Speaker 05

  Right.

• 41:39Speaker 03

  Then they had, then there's.

• 41:40Speaker 05

  Which is a hu- is a very high bar. So anyway, so.

• 41:42Speaker 03

  Yeah.

• 41:43Speaker 05

  The city, the city, uh, P I O kept insisting that, no, no, we're not going to send those out. And I was like, I don't think this is right. So I called up Ginny Gennaro, the city attorney, and she was like, you know, what? No, there's this whole lot, there's this whole law thing.

• 41:58Speaker 03

  Yeah. So they're going out. She was like, no, they're going out.

• 42:00Speaker 05

  Yeah. So they went out.

• 42:01Speaker 03

  Yeah. And like you said, you're seeing it on Nextdoor.

• 42:04Speaker 05

  Yeah.

• 42:04Speaker 03

  This is a double whammy for the city because they're going to, they've already got all these.

• 42:08Speaker 05

  Yeah.

• 42:08Speaker 03

  Pissed off citizens.

• 42:10Speaker 05

  It's not going to be, you swore, you got to swear.

• 42:11Speaker 03

  That's not a swear word, is it? We're, we're not in the UK.

• 42:17Speaker 05

  I demand swearage.

• 42:18Speaker 03

  Yeah. In all fairness though, like, I, I don't have a ton of sympathy for the city water people because it's like, they're like, we're paying more. You know, we're paying more, you know, and it doesn't seem super unreasonable if it's going to go up to 60 bucks a month.

• 42:34Speaker 05

  I don't have a, I don't have a problem with any of these fee increases as long as they can show.

• 42:39Speaker 03

  That it's legitimate expenses.

• 42:41Speaker 05

  Expenses and with the sewer rate, it absolutely is. And here's the other thing is it all comes down on the water board, the water department. Because last year, last July, they merged wastewater into the, uh, water resources department, which usually had only been dealing with, you know, just providing people with drinking water. So they're having to take on this whole other thing and, you know, do with, deal with public works and really kind of, I get it that they looked at this and went, oh. Crapola, we've got to do something and I don't, I just, I disagree with how the city has gone about things. And by the way, Christian Clegg got an earful from me about how this was, you know, very poor adherence to the Brown Act, very poor adherence to Public Records Act, very poor adherence to, you know, outreach. I don't hold back. I'm kind of, I'm kind of.

• 43:26Speaker 03

  Again, that's, this is why we have journalism. This is why we have local journalism, I think, is one of the major factors. Nobody else is going to go there and get as upset as you are about it. They're not even going to notice it. You know, they're going to look at the slideshow and they're going to go, oh yeah, okay, I guess we got to pay for it. They vote, okay, there we go.

• 43:43Speaker 05

  And I was just sort of sitting in this meeting like, wait, hold the phone, what's happening? You guys are not going to get this past people once it starts out. But like I said, the Prop 218 elections are kind of a little bit of a sneaky way. I don't want to, I don't mean like the city's trying to be sneaky. I mean, the Prop 218 is kind of like, oh, you have to, it's an opt out election. And if not enough people opt out, you're automatically opted in.

• 44:04Speaker 03

  Yeah.

• 44:04Speaker 05

  So it is kind of like they had to, they passed it as a method of transparency for the public, but it's a, it is a high bar. Getting 51% of people to send in letters and do it the proper way. You have to have your name, you have to have your address, you have to have your parcel number. Does everybody know where their parcel number is?

• 44:22Speaker 03

  No. And you got to get 51% of the people to write it. Yeah.

• 44:26Speaker 04

  So, so what's the deal with this solar energy project thing?

• 44:29Speaker 05

  Which solar energy project?

• 44:31Speaker 04

  See here.

• 44:33Speaker 03

  I want to hear, I want to hear about, while you're looking that up, about bringing back the Kern. Cause there was, there was a, there has been some movement on that. I was just, almost a month ago, but there was a ruling.

• 44:45Speaker 05

  Uh, okay. So.

• 44:47Speaker 04

  Yeah, it says it here in the article, but go ahead.

• 44:48Speaker 03

  What, does it say about the solar?

• 44:50Speaker 04

  It says something about solar energy project for $12 million.

• 44:54Speaker 03

  Is this part of the upgrades that they're doing?

• 44:55Speaker 05

  Yeah, that's, um, yeah, that's one of the things that they want to try and do because, um, any water system's main cost, aside from treatment, is power. Pumping the water and moving it.

• 45:06Speaker 03

  Oh.

• 45:06Speaker 05

  Huge cost.

• 45:07Speaker 03

  Yeah.

• 45:08Speaker 05

  And I think it's $12 million a year that power costs the city just to move water. And so, um, the council member, Bob Smith, at that March 12th meeting was like, we've got to get solar, we've got to get solar, we've got to get solar. Well, that has its own cost too. And I, you know.

• 45:24Speaker 03

  Yeah.

• 45:24Speaker 05

  So anyway, but, um, not a bad idea. Not saying it's a bad idea. It's just, yeah, it's, that's one of the things that they're kind of trying to look at is how do we operate this more efficiently?

• 45:33Speaker 03

  I see. Yeah. That could save us money in the long run.

• 45:35Speaker 05

  Right.

• 45:36Speaker 03

  My guess is they're gonna end up issuing bonds.

• 45:38Speaker 05

  Oh.

• 45:39Speaker 03

  They're not gonna be able to pass it. They're not gonna be able to pass.

• 45:41Speaker 05

  Not at this point. I mean, they've.

• 45:43Speaker 03

  Paying that much more.

• 45:44Speaker 05

  You know, they screwed the pooch on this one. Sorry.

• 45:47Speaker 03

  Our previous leaders did, right?

• 45:49Speaker 05

  All of the above.

• 45:51Speaker 03

  Well.

• 45:51Speaker 05

  You have a mess, right, that has not been attended to.

• 45:56Speaker 03

  Yeah, since the 90s.

• 45:57Speaker 05

  Right. Well, I mean, in 2006, they did some stuff and this and that and the other.

• 46:00Speaker 03

  They did a small increase.

• 46:02Speaker 05

  You know, people, and then last year, they were like, oh crap, you know, they moved it under another department. And that's when everybody was like, sort of like, oh, we've got to fix this. We've got to fix this. They should have started last year saying, explaining to the public, this is a problem. This is what, here's our options for how to fund it. I mean, they really need to bring the public in, but to just zap them with a 300% increase.

• 46:22Speaker 03

  Yeah.

• 46:23Speaker 05

  I mean, my goodness.

• 46:24Speaker 03

  Yeah, it's not good.

• 46:25Speaker 05

  No.

• 46:26Speaker 03

  It's not good. So, real quickly, we just got a couple of minutes here. The Bring Back the Kern, where do we sit on that?

• 46:32Speaker 05

  Okay, so we sit, well, the lawsuit is still going on and the lawyers for Bring Back the Kern say that, you know, any lawyer is gonna tell a media person anything other than something, oh, yeah, we're gonna win this sucker. You know, we're gonna get water in the river for sure. So that lawsuit is still going on. It basically demands that the city look at its operations of how it operates the river based on the public trust doctrine, which says, you know, you've got to have water for the public trust and, you know, the highest best use, and that can include environment and public access. So they, they think that that's gonna move forward. That, the next hearing on that is December 8th, I think.

• 47:11Speaker 03

  Oh, my gosh.

• 47:12Speaker 05

  Yeah, so it's a while. In the meantime, the injunction that had been issued ordering the city to have some water in the river has been completely reversed by the 5th District Court of Appeal. Not only was the injunction reversed, but, and they remanded it back to the court. Like, hey, if you want to, you know, reinstate this injunction, here's how you have to look at it. You have to first determine what an adequate amount of water for fish would be. That's like a huge fight in and of itself. That's like never, you know, you go back and forth on that with experts forever, environmental documents, blah, blah, blah, blah. So that's hurdle one.

• 47:44Speaker 03

  Yeah.

• 47:45Speaker 05

  Totally unsustainable. Once you've determined how much water that takes, then you have to balance it, like, is that reasonable? Is that a reasonable use in comparison with the other uses? Huge fight, never gonna get past it. And then the third hurdle that is completely insurmountable is the justices said. You have to post a bond, like whenever you sue somebody and you want an injunction, you have to, you as the plaintiff have to post a bond, like say I'm going to enjoin you against talking and that's how you make your living, right? Well, if the injunction is successful and you are no longer allowed to talk, you're losing money and then if later the injunction is found to be faulty, you're out all that money, right?

• 48:26Speaker 05

  So, the idea is the plaintiffs have to post a bond to pay for that potential loss of revenue.

• 48:32Speaker 03

  Oh, boy.

• 48:33Speaker 05

  Well, in environmental lawsuits, that's always been a nominal bond and in this case, it was a thousand dollars. Well, the plaintiff, I'm sorry, the appellants, the water districts came back and said, hey, while that injunction was in place, we lost 5.7 million dollars. So, if, say, you know, I mean, that could be 50 million dollars, depending on how long it might take to appeal an injunction and that means, and you have to, unlike a criminal case, as I happen to know, a bond, you know, is 10%.

• 49:00Speaker 03

  Yeah. Is that the same in this case?

• 49:03Speaker 05

  No, it's 100%.

• 49:04Speaker 03

  Oh, no. So, they'd have covered potentially 50 million dollars or tens of millions of dollars, potentially.

• 49:11Speaker 05

  Right.

• 49:12Speaker 03

  Well, dang.

• 49:13Speaker 05

  So, that injunction is likely, is a no-go, but that issue is probably going to go to the state Supreme Court. I'm going to bet that is.

• 49:22Speaker 03

  Well, so, there's hope. You're for it, right? You're for water coming through the river?

• 49:27Speaker 05

  Well, I cover it. I don't know, I'm just telling you what happens.

• 49:29Speaker 03

  I know, but come on, we all want water in that river. We don't want it to be crazy, but it's so, it was so nice when we had water flowing. We got a taste of what it could be like, right?

• 49:40Speaker 00

  Well, we'll have Gary Ananian on this Friday.

• 49:42Speaker 03

  Oh, great, great. He wants water in that river.

• 49:45Speaker 05

  Well, he has water in the river. He's up there above the canyon. He's got as much water as he wants.

• 49:50Speaker 03

  Well, thanks so much, Lois Henry. That's Latroy Dinkins. I'm Sharad Waite. Remember these three things: be smart, be safe, and always be money wise.