6/23/25 Bakersfield Business Beat: Oil Regulations, Wonderful Pistachios, and New Development

The Moneywise Radio Show and Podcast Monday, June 23rd 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_Management Guest: John Cox, Business Editor for the Bakersfield Californian website: www. Bakersfield.com

• 0:00Speaker 00

  From the Garo Ellis padded radio room off Stockdale Highway, here is Money Wise. Call or text into the show 24/7 at 396-1000.

• 0:39Speaker 00

  Here is Money Wise.

• 0:40Speaker 01

  Money, money, money, money.

• 0:43Speaker 02

  Welcome to the Money Wise Show. We are live from the Garo 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 01

  Sammy Abiyawi.

• 1:05Speaker 02

  Sammy Abiyawi. We've got a couple of listener questions and comments.

• 1:09Speaker 01

  Yes, we do.

• 1:10Speaker 02

  And it's a great way to start the show out.

• 1:11Speaker 01

  Yes, definitely. Hello, Money Wise. I've got to hand it to you. The way you guys break down financial complexities on your show is nothing short of brilliant. Your ability to cut through the noise and deliver real, actionable insight is a huge reason your show stands out in a crowded space. I just wanted to let you know that a friend turned me on to your show, and I've passed that along to a few business partners, and just wanted to say thank you. Have a great day.

• 1:37Speaker 02

  Wow, so nice, Sammy. I'd love hearing that.

• 1:39Speaker 01

  Yeah, it's great. This is exactly why we do the show.

• 1:42Speaker 02

  Yeah, and, you know, we consistently are looking for feedback. We want, we want to improve our, this program. We want to improve what we feel is a service to our community. And some of the feedback that we have gotten over the years has been that sometimes we, we're talking about things that are, are too complex.

• 2:03Speaker 01

  Yes.

• 2:04Speaker 02

  And we take it for granted because we use a lot of these acronyms, and we use a lot of these, you know, these, these examples, and, and that, you know, we take it for granted that not everybody has heard all of this stuff before, and so things can just go over the top of heads. So this was, this was really nice to hear.

• 2:19Speaker 01

  Yes, very, very nice.

• 2:20Speaker 02

  And really appreciate the feedback.

• 2:21Speaker 01

  Cool, we have a question actually. Hey guys, I know you don't talk politics, but do you see the bombings over the weekend hurting the markets? Starting to make me nervous.

• 2:31Speaker 02

  So this is really great because this will lead us right into some of today's headlines. Of course, you know, over the weekend, we had a involvement, the United States got more involved in the bombing in Iran and bombing some of those, their nuclear sites. And of course, this just happened, you know, not too long ago, just less than two days ago. And, you know, like the listener, me too, was thinking, okay, markets are closed right now during the weekend. Generally speaking, when you have a major geopolitical event like a bombing happen, the markets will retreat. They'll go down because it leads to uncertainty about the, about the future

• 3:15Speaker 02

  and about what things might cost and how long that might take for things to settle down. And so I was surprised, very much surprised today to actually see the markets go up. So major indices here in the United States are up in positive territory and they're decent gains. It's not just, you know, just like a little bit. S and P 500 is up nearly 1%. The Dow is up 0.9%, Nasdaq's up almost 1%. So we saw across the board an increase in the value of equities.

• 3:50Speaker 01

  Same thing for oil prices, I believe. I don't think they've fluctuated that much. I don't think we, we've, we, we saw a large increase. In fact, I think they retracted a little bit.

• 4:03Speaker 02

  Yeah, oil prices?

• 4:04Speaker 01

  Yes.

• 4:05Speaker 02

  That was another big shock because we saw oil prices today fall about 7%. They, it opened up at $72 a barrel and it closed at about $68 a barrel. This is very surprising to me because of the region that we're, that we're involved with is a very large producer of, of oil and gas. And they also, there's been some fear. That the Strait of Hormuz could be could be somehow disrupted and you know, we don't, I don't, as far as I know, we don't import any oil from Iran and haven't for a long time.

• 4:44Speaker 01

  Since 1979.

• 4:45Speaker 02

  Was that, yeah.

• 4:48Speaker 02

  But it's this idea, it's the global market. It's the oil is traded on a global scale. And so when there's a disruption on a major producer, it can have, it can have effect on us here in the United States. But today we saw oil prices go down, which is again, counterintuitive. And it goes to show how difficult it is to trade on news.

• 5:09Speaker 01

  That's right.

• 5:09Speaker 02

  Because you.

• 5:10Speaker 01

  It's just investors brushing aside. So to me, if I'm an investor, what I'm looking at is, is Iran going to retaliate and how big that retaliation is going to be, right? That's, that's what I would, and of course, they're going to have to, in my opinion, so they can say face and show their internal population that, hey, we're going to stand behind what we always say we're going to do.

• 5:33Speaker 02

  Yeah.

• 5:33Speaker 01

  So they attacked the base in Qatar, one of the largest US bases in the Middle East and another base or bases in Iraq.

• 5:43Speaker 01

  But they've, or they've gave the warning to Qatar before they did that. And I'm sure they've also warned the US like they did before on the last attack.

• 5:51Speaker 02

  Iran, Iran warned them and said, hey, here comes some bombs.

• 5:54Speaker 01

  Yes.

• 5:56Speaker 02

  How, how nice. How polite.

• 5:58Speaker 01

  This is, this is polite war.

• 6:00Speaker 02

  I know. It's, it's a, it, I don't know, Sammy, to me, it just, you know, stop, I need to stop trying to make sense of why the market moves in certain directions.

• 6:11Speaker 01

  Yes.

• 6:11Speaker 02

  Because it's, you know, there's larger forces that are coming into play. But it does seem as though it's like very early, we've only, you know, the bombing on, in Iran took place on.

• 6:26Speaker 01

  The Saturday night?

• 6:26Speaker 02

  Saturday night, early Sunday morning.

• 6:29Speaker 01

  Stadium when that took place.

• 6:30Speaker 02

  Yeah. And so, and then it's like, okay, we, you know, we're less than like 48 hours roughly from it. And just based off of the, the one retaliation here that Iran has. Place traders are going ah few ah it's not going to be that big of a deal and I'm thinking what it's only been a couple of days.

• 6:48Speaker 01

  That's right. That's right. And and and I think you're on to something there shared because a lot of the for for instance, a lot of the airlines in the Middle East have suspended flights in the region. Kuwait Air, Egyptian Air and a bunch of other countries. So that I don't think we have seen the impact yet now. I don't think I think I'm okay with with the oil. The only thing I can think of is the twenty to twenty five percent of the oil. World oil travels through the Hormuz. So if there's disruption there, we might see a difference in the next couple of days depending what Iran does.

• 7:26Speaker 02

  Yeah.

• 7:27Speaker 01

  And and also just goods that are coming from China towards Europe and some parts of Africa. That and maybe even America to tell the truth, we we might see some increases in prices depending on how long these things last.

• 7:42Speaker 02

  Yeah, that's the that's the big unknown. How long is this going to last? And then I would just say it's still unknown and how bad it could get.

• 7:50Speaker 01

  Yes.

• 7:51Speaker 02

  But traders and stock market traders, they're they're always just really looking ahead. They're always trying to. Get, you know, you know, really get out there ahead of things. And so. Um, hopefully that it is a sign of.

• 8:06Speaker 01

  De-escalation.

• 8:07Speaker 02

  Yeah, it'd be great. More politeness.

• 8:09Speaker 01

  More politeness.

• 8:10Speaker 02

  It's weird. I mean, I I'm glad that there's a warning before you they drop a bomb, but it's it's also like, I don't know, it's just. It just seems like we're in a weird space of that and all the drone stuff.

• 8:21Speaker 01

  Oh, yeah.

• 8:22Speaker 02

  Um, absolutely be absolutely terrifying to live.

• 8:25Speaker 01

  War has changed.

• 8:26Speaker 02

  Yeah.

• 8:27Speaker 01

  Face of war has changed.

• 8:28Speaker 02

  Yeah.

• 8:29Speaker 01

  Dramatically. I I just hope for the population in that region of the world, just for things to just de-escalate.

• 8:35Speaker 02

  Yeah.

• 8:36Speaker 01

  People get back to their senses and hopefully there's none no more nonsense.

• 8:40Speaker 02

  Yeah, I'm with you. I'm with you. All right. Last message.

• 8:43Speaker 01

  Yes. How do you think the high speed might change things economically here in town? And what should our local leaders be doing right now to prepare whether this thing? Actually gets built or not lol.

• 8:54Speaker 02

  Gosh, this is, this is a really great question. If anybody missed our interview with Vince Fong last week.

• 8:59Speaker 01

  I think we're gonna, we're gonna put it back on. Wednesday.

• 9:02Speaker 02

  Replay it on Wednesday. It's, it's worth replaying because it was, um, it was eye opening to me to, to, to peer into sort of what Congressman Fong's thinking about this high speed rail. He's been opposed to it for a very long time. And of course, my, my, my big question is what, what about all of these, the costs that we've already sunk into this? And what, what would happen to that? And this listener brings up even more questions about what, what, you know, what about our local politicians? How much are they currently investing in preparing for the high speed rail to come through? And what would, you know, should they be doing more or less? Is that money just going to be wasted?

• 9:47Speaker 02

  It's not really, as far as I know, maybe, maybe our next guest, John Cox from the Bakersfield, California, he's been reporting on this for years. When we have him on in the next segment, we can get his opinion on this, but the, the, the city, other than, you know, trying to, to, to talk about this, I think there has been some city planning that has been done in terms of where the station, the high speed rail station is going to be over off Golden State. But I don't know how much the city itself is investing, you know, how, how much of this is a distraction?

• 10:20Speaker 01

  Yeah. That's costing us. I don't know, don't know much. I just, I look at the cost of the project, the length of the project. And you, you talked about, you know, sunken cost or how much money we spent already. We had a term in banking, don't throw good money after bed.

• 10:35Speaker 02

  Yeah.

• 10:37Speaker 01

  You know, when, when a business is going out of business, you know, you as the banker is like, maybe it's time to throw in the towel. I don't know if that's the case. I wish for the idea to actually take place. Like if you traveled the world, especially Europe, or if you go to certain countries, dude, there's a high speed rail in Morocco. It's actually nice. You get in within one town to another in 45 minutes.

• 11:02Speaker 02

  Yeah.

• 11:03Speaker 01

  It's beautiful.

• 11:04Speaker 02

  Yep.

• 11:04Speaker 01

  I wish this thing works. I wish we have it. It's, but I think we have some, some bottlenecks that need to be worked out. Land acquisition is one of them. You know, the, the other thing is just labor cost.

• 11:17Speaker 02

  Yeah.

• 11:18Speaker 01

  And and and just the opposition to the project from the get go.

• 11:22Speaker 02

  Yeah, there's but yeah, it's been there's been a lot of opposition because it just is like like a lot of big infrastructure projects, they become underfunded and they become delayed. And this is I mean, this this is a project that was supposed to already be done.

• 11:40Speaker 01

  Yeah. So it's projected just this segment, I think they're doing, and maybe maybe Mr. Cox, when he comes on, he can talk about this. The segment is projected to finish, I think, by 2030 with the the the longer or the biggest part of it, maybe late in the 2040s. So is it still a doable project? I don't know. What can we do or what the leaders can do here locally to prepare? I really don't know if they can do anything at this point.

• 12:10Speaker 02

  Yeah.

• 12:10Speaker 01

  Given where the project stands.

• 12:13Speaker 02

  I I I liked the idea of what it if it does get completed, what it could do to our region, even if we're just connected to Merced or that's where it is, right? The northern stop. I mean, because I'd love the idea of getting to Fresno and, you know, 40 minutes or whatever, half an hour and, you know, grab dinner and come home like you could can have a nice date, you know, real, real comfortably. And and that, of course, will enhance the Central Valley as we would have, you know, a quarter sort of these hubs that can be here and could, you know, incentivize more people to want to

• 12:55Speaker 02

  buy here, live here, spend their money here when they can just jump on a train rather than jumping on I five to get to their work. And that, you know, I think it kind of shrinks down our the size that our. That we have here in terms of our economic island. I really, I really think that the, that the economic benefits could be really great for Bakersfield. Whether they're great for the state that's invested all this money and the taxpayers a whole, it's, I think that's yet to be seen. So when we do this, when we take a break, we come back, we're going to have John Cox join us on the show. He's from the Bakersfield Californian. We've got a lot more to talk about. Don't go anywhere.

• 13:32Speaker 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.

• 13:49Speaker 03

  John Cox. He's a man of a million words. John Cox. He's the king of the business nerds. He looks like Jimmy Elson from Superman, but a little bit taller and a bit of a tan. John Cox. He's from Bakersfield, California. John Cox. He's stories on credit unions. It's a good thing that he's only on the radio air, or else you'd be distracted by his dark flowing hair. John Cox.

• 14:18Speaker 02

  There it is. Theme song to John Cox. He's our current guest right now, joining us from the Bakersfield Californian. John, welcome back to the show.

• 14:24Speaker 04

  Thank you very much for having me. Great to be here.

• 14:26Speaker 02

  Great to have you. You have been following for years, the county's move to take on the responsibilities for permitting oil, new oil wells and, and that. Wrote and released an article on Thursday giving an update. What can you tell us that's new there?

• 14:48Speaker 04

  Well, so at the planning commission, which is more procedural vote, you know, it's a recommendation, but either way, the question was going to go to the board of supervisors. I believe that is set for, I think it's 10 a.m. this Thursday, and I plan to be there covering it in the house. I expect a lot of people would be there, a lot more than, a lot of more comments that we saw during the planning commission. I mean, there was, there was a time when there were just hundreds and hundreds, you know, when people were calling in during the pandemic from LA and elsewhere around California. Big concern being, you know, how many new wells are going to come out of this? And, and some of the statements that have come out, well, according to Laura Oviott

• 15:30Speaker 04

  are just vastly inflated, such as, well, you know, this is going to bring 50,000 new wells to Kern County. Well, Probably it'll be no more than about 19,000, but I think that the limit by 2035, which is apparently the timeframe we're talking about, would be about 23,000, I think. So far less than some of the observers have estimated. So that's a concern, how many new wells is it going to be? But I think that this time it's a big concession. I think that the oil industry has funded this. So a lot of what has happened, I think Orla- Orla-Li speaks with the oil producers,

• 16:13Speaker 04

  the association, saying, you know, what are you willing to do? How far is it going to go? Because you're balancing a couple of things. There's, you know, balancing what the court wants and what the opponents are pushing for and finding flaws within the environmental review versus what's going to be the cost of this to oil producers who may, you know, want to get an oil permit for something? And the price is going up. The cost for producers, if this goes through, it's going to go up substantially because there's going to start paying into these funds and requirements that there be, for example, replacement of farmland that you have to buy from an existing, you know, conservation within the county. That's a limited supply.

• 16:58Speaker 04

  Right. Not like anywhere in California, you just buy a land and you say, well, there's our replacement farmland. So that's part of it. And then paying for, you know, matching of state funds into helping local water systems. So there were already expenses that producers were paying for. This is going to add substantially to that. My understanding is that they're willing to pay that. Nobody wants to see their costs go up. But above all, what a business people want. They want certainty, you know? Take the risk out of this. We want to know just what it is we got to do to get that permit. And so the question is next is, is this going to satisfy the courts? Right. And I don't think there's any question that the opponents of this measure for

• 17:40Speaker 04

  climate change, for environmental health, to what they call the frontline communities living near these, they're going to be against it. They're going to say more needs to be done. Just historically, that's what they've done and they're against this thing philosophically. So what are they going to come back with? If the judge approves this, what are they going to come back with? Because that's going to determine whether the permitting resumes or not. And if it doesn't happen, I don't know that we can expect to see much at the state level. Although we do hear that oil producers have been a little cautiously optimistic about some of the permitting that's been happening lately, a little easier to get permits than it had been.

• 18:25Speaker 04

  Not necessarily drilling new wells, but reworking existing wells.

• 18:28Speaker 02

  So I was going to ask you that. This is saying that over the next 10 years, it could be up to 19,000 permits issued in the county of Kern.

• 18:36Speaker 04

  Likely so, based on averages. It could be more than that, but likely it would be in that range.

• 18:40Speaker 02

  That seems like a lot because my understanding is they're essentially not being issued at all right now. Are there some that are being issued?

• 18:47Speaker 04

  There have been some, but those are based upon existing approvals, project like plans that were submitted long ago and that they sort of didn't get the final permit. All the reviews are done, everything is ready, you just need the final thing. And apparently, if you've got these things completely done otherwise, the state has shown some flexibility, permitted those, Berry Petroleum, I believe, and maybe CRC. But I think certainly Berry has been able to get some permits. But for the most part, what you're seeing out there, according to the oil producers I've talked with, are reworks, what is it, the side?

• 19:31Speaker 04

  I forget what those are called, the side, can't remember. But also plugging and abandonment. If you want to plug your well as you sort of have to, under a certain percentage, have to be done by state law, you can get a permit to close your well. The state is giving those out. Can you drill new? Drill new, only very limited circumstances at this point.

• 19:53Speaker 02

  Right, and part of this new procedure will require is asking that the oil producers shut down anything. That's on there before they create anything another well or they do anything else. I think I read that somewhere, maybe not. Yeah, also reported that the fees for each new oil well would amount to $9,732, which is projected to raise between 17.3 million and 25.9 million per year. This would be for the county. That seems low.

• 20:24Speaker 04

  I don't know that it would be stay with the county. What I mean, I think that some of that is what they call mitigation measures. You have to pay into some fund for like air quality and things like that. So, you know, when you think how much it costs to drill a well, you know, that's not nothing, but it is a small portion of the total overall cost of doing it.

• 20:44Speaker 02

  Right. I mean, this is the bigger, the big discussion for us here locally is the, the fact that the revenue, the tax revenues that we're used to receiving from these big oil companies is just shrinking very quickly.

• 21:00Speaker 04

  Right.

• 21:01Speaker 02

  And then there is a concern about the loss of the refineries in our state and the, you know, the prices of our gasoline that we're paying for potentially going up. And so, you know, it just seems like there's so many disadvantages to the oil and gas producers here that, and I'm even skeptical that this would even pass, like that the county's going to get away with this. Is that still questionable? That a judge is going to rule that this is okay?

• 21:33Speaker 04

  Definitely. It's in question. However, you know, I spoke with Lorelei about this when I think it was about a year ago, maybe not that long. No, it couldn't have been that long, that, that she released the, the revised supplemental, you know, environmental review. And her feeling was that she was going to be. Anxious to see what they come back with because she, her reading was that they've done everything, you know, some measures, some steps that they were not expecting to have ever have taken. Now, you know, they've conceded, okay, fine, we'll do all of that just to give us a little certainty and address pent-up demand.

• 22:13Speaker 04

  I see what you're saying, you know, is there, is there much sense in even trying to build, investing in new wells around here? Maybe there is a relationship between some of these refineries, well, certainly there is, and local producers. Some of them need the kind of their gear, they're designed to take in California crude, you know, the heavy oil that comes out of Kern County. And so you produce, they might have to get that from somewhere else. They'd rather get it from California. They could lower their costs if they get it from California. So, you know, maybe, maybe these refineries would be in a better position if they could get some Kern County crude.

• 22:58Speaker 02

  Yeah, I mean, it wouldn't, it's, it's, it's a frustrating subject. It's, I'm glad you're reporting on it still, I'm glad you're following it, that the county's quickly trying to reinvent itself to replace the loss of, of tax revenues that it's used to getting from oil and gas.

• 23:17Speaker 01

  And high-paying jobs.

• 23:19Speaker 02

  Yeah, great jobs.

• 23:20Speaker 01

  Yeah, high-paying jobs that are now leaving the state, leaving the county, going somewhere else.

• 23:25Speaker 02

  Yep.

• 23:26Speaker 01

  And all the ripple effect that those jobs have on the local economies from just expenditures for these individuals, buying houses that are not entry level, they buy a little bit of that mid-sized house, that the second, second house, or maybe even a custom home at times, depending on the job that you have in the oil fields. So we're losing a lot of that.

• 23:47Speaker 02

  Yeah, and it's, you know, you're seeing it also a lot, and I see it when we go to these fundraisers

• 23:54Speaker 04

  Yes.

• 23:54Speaker 02

  You know, nonprofits that have used to be getting very large sponsorships from Chevron, or CRC, and Era, what used to be Era, and, you know, these, these different companies, and they're just, they're just not there.

• 24:07Speaker 04

  Yeah.

• 24:07Speaker 02

  They're just not there anymore. You know, and part of this reinventing of our county of, because of the loss of ag and oil, is warehousing, and being kind of this logistics center. And you wrote on June 10th, John Cox in the Californian, about a report saying that there's a slowing in the warehouse market. There's a pivotal moment happening right now in Kern County. What can, what can you say about that?

• 24:34Speaker 04

  I'm glad you brought that up. I think that's a very significant moment. I read into that, say, this pivotal moment is really, what could happen next is rents actually lowering. The prices have come down, more vacancies, but the rental prices have stayed fairly consistent. The pivotal moment may be that the prices come down. However, if I'm Stuart Resnick, or I'm Toney Ranch, and I'm looking at, how am I going to use this land? Yeah, you, I think you go forward, right? I mean, I think the long term is that there is going to be demand for these. You know, American business is so much focused on quarter to quarter, year over year, you know, that's how we measure our performance.

• 25:18Speaker 02

  Yeah.

• 25:19Speaker 04

  And that's what we look at, demand. Do we look, you know, 10 years out into the future? No. Is there going to be demand for these things? Almost certainly. So, you know, I, I think we, we take that, that report, that things have slowed down, this, this, you know, the star of local real estate has, is dimming a little bit. I think we take that with a grain of salt, because I don't think, I don't think that the situation has changed very much. Are there more vacancies? And more leverage in Southern California? Sure. But, you know, I just think it's, it's more of this sort of, maybe a year, maybe two years? Okay. Is it, does it ju, does this justify holding back in If you're going to go forward like a wonderful project, which is, you know, huge.

• 26:02Speaker 04

  No, I think that is so forward looking. This is probably short term.

• 26:08Speaker 02

  Yeah, I mean, it's worth reporting. I'm glad you reported on it. The average price, sale price per square foot declined 4.5% to settle at $104 a square foot. And the overall vacancy was listed at 7.2, which is up from 6% a year early. And again, we're talking about warehouse properties. So not, not, not residential, but that, you're right. That's like, that is a move and I think it's worth noting, but I mean, that's a natural fluctuation.

• 26:37Speaker 01

  Is that, is that just a natural cycle though? For us building so much space that we don't have the demand yet? We're going to catch up and then the cycle will restart again? Like it happens with, you know, other things like office buildings, like apartments. You know, we don't have that problem with houses, unfortunately. But I've seen it before where the cycle of the real estate just goes up and down based on what we build. And then we catch up and then we restarts again.

• 27:06Speaker 04

  Well, I think, yeah, I think you can see things. How many things just sort of go up forever? Not too much, even gold, you know? But my sense is this started in Southern California. Because really the market that we have here is an outgrowth of what's gone on in Southern California. They're just tired of having so much and they're running out of space. Running out of, you know, patience with these developments. And so apparently what we're seeing here is a reflection of some vacancies that started showing up in Southern California. And if you've got leverage, you know, you're saying, well, I might be interested in going in there to Home Ranch, you know, right next to the five there. But you know, there's an opening down in Southern California.

• 27:51Speaker 04

  And I want, I want you to drop your price a little bit. Well, sure, you know, that, that seems like that could, that could be how this happens. Is it, is it? Is it necessarily a weakness in the local market? No, other than to the degree that we depend, you know, much of this demand is created in Southern California. That's right. So I think that it'll get worked through. But it is, you know, it's worth noting, I mean, people, people sort of get this idea that, well, this, this train is never going to stop. We're just going to up and up and up. Well, nothing is like that, really. Yeah. You know, so, you know, it's, I think it's good to be aware of these things, but, you know, if you've got a lot of investment that you're willing to make in a big project that's going to change the game, such as The Wonderful Company is looking at doing, I don't think this slows them down.

• 28:36Speaker 02

  Well, let's take a break. When we come back, you mentioned The Wonderful Company. You were out there when they had their ribbon cutting for their big new facility out in Shafter. I'd like to hear more about your insights on what's going on with Wonderful. We're Money Wise. We'll be right back after the break.

• 28:49Speaker 00

  Don't forget, Money Wise is more than a radio show. We're an independently owned local wealth management firm with 60-plus years of collective experience. Our financial advisors are here to help you, Kern County. Together, let's be smart, be safe, be money wise.

• 29:09Speaker 02

  Welcome back. We're the Money Wise Show. We're your hosts today. I'm Sharad Waite. Here with Sammy Abiyawi. We're joined by our guest, John Cox from the Bakersfield Californian. John, you recently wrote and attended a Wonderful Company event. This was held out in Shafter last week, and Shafter was treated to this, I guess you'd call it a ribbon cutting ceremony? Did they actually cut a ribbon?

• 29:37Speaker 04

  That's what it was. They did, they did cut a ribbon.

• 29:39Speaker 02

  And this is a new amenities center for Wonderful, really for the community. It is a kind of an employment base that is expected to expand over time around the logistics center. Is that correct? Their big logistics center that Wonderful has out in Shafter?

• 29:57Speaker 04

  Right. It is already large, and they're looking to roughly double it. The size of the thing, so it would become even larger, go the other side of the railroad tracks.

• 30:06Speaker 02

  It's massive. I mean, this, I wasn't there and I haven't seen this, but there's also plans for housing units that the company is proposing to build that could expand Shafter's population by about 40%.

• 30:20Speaker 04

  Wow.

• 30:20Speaker 02

  Like, that's huge. Like, 40%? Can you imagine if, you know, Bakersfield had some project and it was like, oh, we're gonna, you know, we're gonna add 150,000 people to our population. I mean, for Shafter's, it's gonna increase by 40%. That's, that's massive.

• 30:35Speaker 04

  And the way they're doing it is really, I, I'm anxious to see how it's gonna play out. They have taken a ground-up, profound look at their housing situation, look at who are the people who work at this, distribution hub, largely Latino, and they've, they've done focus groups. What do you want in housing? If we're gonna build housing from scratch, what do you want? And, you know, multi-generational is a big thing, you know, the Latino community. And so they're gonna design it that way. How can they remove all unnecessary costs, maximize livability, and make it multi-generational? And so they're, they're, they're designing it with those things involved. Now, I haven't seen the

• 31:17Speaker 04

  exact plans. I mean, I've seen the big view and the, sort of, the bird's eye view, literally, what it would look like. And it is very, you know, for example, like a gazebo that you can do your quinceañera set. That's very, you know, Hispanic-focused, reflective of the community there. But exactly what it's gonna look like, I don't know. But they're gonna have like these ADUs, you know, the, the granny flats, as they call them, where you can buy a property and you can sort of buy right, build one of those if you want for, for your, for your mother, you know, or your grandkids or something. And so they're, they're taking an interesting approach to the housing. I think if this thing goes forward, that's gonna be something interesting to watch.

• 31:57Speaker 02

  Oh, yeah. I mean, this is, I mean, companies don't generally just do these types of things for, just for the good of humanity. I'm guessing that there is, this is self-interest?

• 32:11Speaker 04

  Guided here.

• 32:13Speaker 01

  Need of the labor force for all the acres and thousands and thousands of acres of ag operation they have, but but also I think having or taking an interest into the population is something that, you know, is admirable. Regardless of how you feel about the Resnick family or or, you know, the water conversations that we've had in this state with them having a lot of the water rights and what have you. I mean, some of these things that they're doing is truly admirable.

• 32:41Speaker 04

  Right.

• 32:42Speaker 01

  Thinking ahead.

• 32:43Speaker 04

  Yeah, it they do say to be doing this. They've really, you know, they haven't rushed into this. They have taken the long view on all this and John Gwynn, one of the main points he makes when he when he talks about this is that even government can't do this. Government doesn't have the capacity to build this whole community from scratch. It takes a large corporation, a very large corporation. For example, some of the things that they're doing like this sort of inland port, but it's not exactly that. It's where you you you right now, if you want to to get an empty container for the ports, you got to send someone to LA and bring it up or Long Beach to the ports and bring it back here, where they're going to do a lot of that in shafters, save lots and lots of

• 33:24Speaker 04

  miles on the freeway so that you you dump off your your empty import and you you pick up for for an export. And that's something you have to have a lot of weight as a corporation. Not not any company can just say, we're going to do this here and we're going to sign up the major world shipping companies to become involved in this. Wonderful can do that. And that's sort of one of the major points here. Who else? I mean, really name another company around here that really has the pull to be able to say, we're going to have all of this stuff. We're going to and not many can do it. So, I mean, I do think that there's a sense that if you're a company that has the wherewithal to do this, you know, you're not just going, you're not only going to say, well, I'm just

• 34:06Speaker 04

  going to make as much money as I can on this and we're not really going to think about their workers. You're going to take into account what the community wants, not only to get the approval, but you want people to stay there. You want to work or you want to have a steady workforce and make them happy.

• 34:22Speaker 02

  Yeah, part of this project that Wonderful is working on, this amenity center is a precursor to other developments. It's going to be a training center that works in partnership with Amazon and Bakersfield College to help train some of these warehouse-oriented jobs, right?

• 34:40Speaker 04

  Right, yeah, and that is underway. They're doing it. I've toured that center, too. They've got sort of these classrooms where they teach people how to work on a circuit board and the specific components of the different, you know, they're calling it maintenance and repair, but I believe what they're mostly talking about is the robots, the automation, because they break down. You don't right now have a robot that fixes another robot. People do that. So there's a lot of different jobs, but increasingly, they pay better. There may be fewer sort of, you know, I don't know, basic jobs, but there's a lot more of the advanced jobs that pay better because you've got, you need people who are skilled to be able to do these technical repairs and maintenance.

• 35:24Speaker 01

  That's visionary, in my opinion, because, I mean, we always talk on the show about the lack of, you know, talent to do certain jobs, tech jobs, that are required today to compete against the lacks of China, even Taiwan and other countries, including India, and having stuff like this happening here and close to us in Bakersfield in the Central Valley is really cool. You've mentioned John Quinn, a former manager, city manager of Shafto. Talk about visionary. I mean, a lot of the stuff that happened to the city of Shafto as a city was thanks to him before he moved to the private sector.

• 36:02Speaker 04

  Yeah, yeah. What better person to understand the community and work with him?

• 36:05Speaker 01

  Yep. And he ran the city of Shafto like a business, too, which I really liked.

• 36:09Speaker 02

  Well, and he works for Stuart Resnick, which can be somewhat polarizing, I guess, in some circles, because he's just been such a force to be reckoned with for the last 10, 15 years. And it's not often, as you mentioned in your report, that it's not often that he's seen at these events in Kern County.

• 36:29Speaker 04

  First time I've ever seen him.

• 36:31Speaker 02

  It's the first time you've seen him?

• 36:32Speaker 04

  Yeah.

• 36:32Speaker 02

  And was, and it was unexpected. So he just, there he was, he just showed up.

• 36:38Speaker 04

  I was looking forward to seeing him. So, yeah, I guess I did know that he was going to be there.

• 36:43Speaker 02

  He said, you quoted him as saying, "I say I used to be six foot four. My competition came and beat me into the ground."

• 36:50Speaker 04

  He's funny.

• 36:51Speaker 02

  He's got a sense of humor. Which is, you know, it's, it's, I'm glad he was here. I'm glad that he showed up for that. This seems like a big deal for not just Shaftor, but for Kern County as a whole. And, um, you know, it, my, again, anecdotal evidence that I have of people who've worked at Wonderful, they, they seem to treat their employees well. They give them all a stipend that they can, they can donate. I think it's a thousand dollars that each employee gets that they can choose which nonprofit they wanted to go to.

• 37:25Speaker 01

  Also support their kids too. I mean, if you have kids, if you work for Wonderful and you have kids that are going to college, I mean, some of the, part of the tuition could be, I don't know if it's financed or just given, as long as you attend school, that's something that's also wonderful.

• 37:41Speaker 04

  Right. And then they've got those academies, the one in Delano, the one in Lost Hills. I went to the one in Delano to check it out. They're like high school, basically. Unbelievable. Unbelievable. Everything was so nice. And they teach the kids how to eat and everything is super fresh food. You know, and they have these wellness centers at their workplaces. I mean, I, I, I don't want to minimize, I know there is something controversial going on right now. There is a conflict between the UFW, another significant force based here in Kern County, and Wonderful and about this unionization and some legislation was involved. You know, so I don't want to weigh on are they the ideal employer. I think, I think that they've done a lot for this, this community.

• 38:25Speaker 04

  Especially Lost Hills, Delano, and increasingly Shaftor. You know, they're sort of trying to step back a little bit from their active role in, in Lost Hills and picking up in Shaftor a little bit, a lot.

• 38:40Speaker 02

  Got a couple of questions here, comments. John, maybe you can help us with this. So the first one is here. It says, can you ask, what is being built down Coffee right before you get to Lowe's on Rosedale Highway? I saw two big buildings being built and figured John would know.

• 39:00Speaker 04

  Yeah, we have reported that in the paper. Because I've been watching that property for a long time. The Bakersfield Commons, right? It was gonna be, there was gonna be a top flight golf center. And before that, there was gonna be the baseball stadium and all that. None of those things that we've thought of have moved forward. What we have here is distribution centers. The largest distribution centers within the metropolitan area, actually. I don't know that they've, I think they might be speculative. And by the way, if there's an outcome of what we talked about earlier of the dip in the market, we may see less speculative development starting up, at least in the very near term. But this is that.

• 39:40Speaker 04

  These are two large distribution centers. If memory serves correctly, they are speculative development. I think Rexco is the company that is working with World Oil Corporation to develop those two. Fairly large. I mean, what is a large distribution center anymore? The one by Meadows Field is 2.6 million square feet. That's gigantic. But, you know, large would be 600,000 square feet. A million is very large. They have a lot of those in Chaffter.

• 40:13Speaker 02

  Yeah. Another question here, and it's kind of unrelated, and you may not know the answer, but it says, "I heard over the weekend that Long Beach is testing a new program where there will be areas for public drinking. Wasn't Bakersfield talking about getting rid of the idea of extending later bar hours?" John, I don't know if you know anything about this, but I know that California has recently introduced legislation that will allow some restaurants and bars in California to serve alcohol until 4:00 in the morning on Fridays and Saturdays and state holidays. So extending that time right now, which is 2:00 in the morning. And this has been brought by Assemblymember Matt Haney

• 40:57Speaker 02

  and Senator Scott Wiener are both bringing this measure to sort of extend that and what locally is defined as hospitality zones. And so this would let cities create their own hospitality zones where the last call can sort of be later. I don't know if there's been any movement in Bakersfield or the talk on how the city of Bakersfield would do it, but do you have any insights to that by chance?

• 41:25Speaker 04

  Well, I have heard of that. I don't know that we've had anything in the paper about it unless it's a wire story. I know that Bakersfield College and Memorial Stadium just got some special permission to begin selling beer at the college in the stadium.

• 41:42Speaker 02

  Oh, that hasn't happened. That's not there, huh?

• 41:45Speaker 04

  Well, they didn't. I think they now have the permission. There was legislation. I think it got approved that they're gonna be able to sell beer.

• 41:51Speaker 02

  Wow.

• 41:51Speaker 04

  Um, I haven't, I, I've heard, I know there's been some discussion, uh, but, but was that discussion only in the newsroom? Was it just me and my buddies at two in the morning? There's gotta be somewhere else we can go.

• 42:02Speaker 02

  What do you mean you're shutting down? It's only two. Man, not a lot of good happens, you know, after two.

• 42:10Speaker 01

  I'm telling you, I used, you know, you guys bring me back memories. I used to work the, the night shift in the gas station and I'm glad we closed at two, that the beer section at two, because nothing good happens after that.

• 42:23Speaker 02

  Oh, yeah.

• 42:24Speaker 01

  After 2:00 AM, nothing good happens. I'm telling you, from experience, it's, it's craziness.

• 42:30Speaker 04

  It's worse.

• 42:31Speaker 01

  It's, oh, yes.

• 42:33Speaker 02

  Well, a couple of people in Sacramento feel like it's something, I don't know if it's the bar lobby.

• 42:37Speaker 01

  Yeah.

• 42:38Speaker 02

  Or who's, who's really pushing for this, uh, but.

• 42:42Speaker 01

  I mean, if, if there, if there are people that are drinking, they're responsi- I think those two words don't go together. Drinking and responsible just don't go together. Drink responsibly. I don't know who came up with that.

• 42:53Speaker 02

  Yeah.

• 42:55Speaker 04

  Budweiser.

• 42:56Speaker 01

  Yeah, exactly. Drink responsibly. Yeah. What is that? Uh, on, on O'Doul's with 2% alcohol?

• 43:04Speaker 02

  John, you've also written about Tesla's plans for its first local dealership in Bakersfield. What can you, what can you share about that?

• 43:12Speaker 04

  Yeah. So, uh, so if you go, I can't remember what the name of the street is, but it's kind of on the west side here. There is a, there's, it's not a dealership repair center, but you can't pick up your new Tesla there.

• 43:23Speaker 02

  Yeah.

• 43:23Speaker 04

  And I've driven by and there's Teslas all over and the Cybertruck all over, but not a proper, you know, dealership. So this one is right next to the 99. Um, and it's under construction.

• 43:34Speaker 02

  Right in the auto mall, right?

• 43:35Speaker 04

  Right. Well, just off, I mean, so the, all the auto mall, but it's not on Wybelle. It's, uh, between Wybelle and, and Highway 99.

• 43:44Speaker 01

  Is it gasoline alley?

• 43:46Speaker 04

  It's not that street. Um.

• 43:48Speaker 01

  Is that the new building being built right now next to Toyota?

• 43:51Speaker 04

  No, that one's Toyota.

• 43:52Speaker 01

  Okay.

• 43:52Speaker 04

  That one is actually Toyota. They've consolidated the big chats. We had something in the paper about that a while ago.

• 43:57Speaker 02

  Auto Mall Drive.

• 43:58Speaker 04

  That's it.

• 43:59Speaker 02

  That's it.

• 44:00Speaker 04

  Thank you. Auto Mall Drive indeed. And, uh, this is the former Gailey's Marine. I, my understanding was they were going to take down the building. No, no, they're just, uh, making some changes to the building. I think.

• 44:14Speaker 04

  Certainly this year, I think they plan to open the thing. So, you know, I see a lot of Teslas around town. And so is there a market? Sure, I think there's a market. And I don't think one makes a big investment like this unless you know. However, I would say that I think that the decision to go forward with this was made before sort of the controversy that Mr. Elon Musk was involved in in Washington. And so, you know, sales were affected by his involvement there. Will that turn around? Is there? Yeah, I think there's probably still plenty of appetite for it. But, you know, not something I watch very closely.

• 44:51Speaker 01

  If I was a betting man, I would bet on Tesla being successful in Bakersfield. We're a red town.

• 44:56Speaker 04

  Yeah.

• 44:56Speaker 01

  We're not a political show, but this town and county altogether is a red.

• 45:00Speaker 04

  Yeah.

• 45:00Speaker 01

  And county, so.

• 45:02Speaker 04

  Yeah.

• 45:03Speaker 01

  I think the controversy he created was well received here.

• 45:07Speaker 04

  Well, on the other hand, you know, we're an oil town, too.

• 45:11Speaker 01

  That's the other thing, yeah.

• 45:12Speaker 04

  I don't think that stops folks. I think there's plenty of people who are engineers, let's say, in oil fields and kind of would be interested in getting a Cybertruck or a Tesla. I think there is some support for that. But there's going to be some people who are never going to want to get rid of their Dodge Truck.

• 45:28Speaker 01

  Yep.

• 45:28Speaker 04

  Or F-150, you know?

• 45:30Speaker 02

  Yeah, right. Or of, you know, another topic that you wrote about are oil rigs that are electronic.

• 45:38Speaker 04

  How about that?

• 45:39Speaker 02

  E-rig. So you've written about e-rigs cutting emissions. And I'm like, an e-rig? So this is, explain this. This looks like it's a, it's basically a hybrid electric well servicing rig.

• 45:50Speaker 04

  Yeah.

• 45:51Speaker 02

  And this is like interesting because like, why would an oil company invest in a, in a technology that's putting their, their sector out of business?

• 46:01Speaker 04

  Well, if you can get credit for it, I think, and I wasn't able to confirm this for this story, but it would be interesting to know whether this could factor into the low carbon fuel standard. Low carbon fuel standard, look at the overall carbon intensity of your fuel. And if you can say that we overhauled this well, again, not for drilling, but for doing work like, and I remember the term sidetracking.

• 46:23Speaker 02

  Sidetracking.

• 46:24Speaker 04

  Sidetracking, it's when you're working on a well as opposed to drilling a new one.

• 46:30Speaker 04

  So.

• 46:32Speaker 04

  If you can, if you can show to the regulators that I have now lowered the carbon intensity of my fuel that I'm producing, or the oil that I'm producing, and I sell it to a refiner, then the amount of cap and trade that you need to pay into that system could be lower. Now, I'm not exactly sure how that works, and is the system set up to take into account your hybrid rig? I don't know. But of course, you know, the bigger point in this story is that that's not necessarily the biggest challenge. It's getting adoption by an industry that likes to do things the way it has always done things.

• 47:08Speaker 02

  Yeah.

• 47:09Speaker 04

  That applies to farming, that applies to oil. You're gonna have skeptics who say, "I know how to use the old one. I like the old diesel rig. I'm sticking with my diesel rig. I don't wanna have, I don't wanna have to retrain my guys." And if it's your guys are gonna be doing it, they already have the experience in that. So, that's gonna be the bigger challenge.

• 47:30Speaker 02

  Well, we've covered oil, and we've covered a little bit of ag, but one other thing that you've written about also is the almonds and bees. You've been following the bees, the bees story for many...

• 47:42Speaker 04

  Wherever they go, I go.

• 47:43Speaker 02

  Yeah. New federal report suggests 60% of bee colonies that would have otherwise pollinated Central Valley orchards instead died from viruses. And yet, it appears that we should still have a decent crop this year of almonds.

• 48:01Speaker 04

  Yeah, yeah. Well, they were able to get them. They were able to get the pollination that they needed this year. But this is something that absolutely needs to be addressed. It's just getting so expensive. It's very hard for the beekeepers. We draw essentially all of the nation's bees to Kern County, well, the Central Valley, in January, February. And, you know, they have an extremely important job to do that, you know, is important for our local economy. We need to make sure that the bees are healthy, that they're gonna be doing, they're gonna be coming back, and that the beekeepers are gonna continue to invest their time and money into bringing them back. And if 60% or whatever are dying, you're gonna see few people... Fewer people in that business. And there are, you know, self pollinating trees.

• 48:46Speaker 02

  Almond trees?

• 48:48Speaker 04

  Almond trees.

• 48:49Speaker 02

  Oh, wow.

• 48:50Speaker 01

  They have, they have the varieties that are different. That's why they plant them one variety next to the other variety. So they can cross pollinate just via wind or whatever.

• 48:59Speaker 02

  Gosh, well, just cut out the bees altogether, right?

• 49:02Speaker 01

  You know, we're talking about bees. I have, I have a bunch of them in my backyard. I don't want to kill them just because I had the, the pest control guy at the house Saturday was like, oh, we don't touch those. Oh, good for them. Which is great.

• 49:12Speaker 02

  Yeah, you need those bees.

• 49:13Speaker 01

  Yes.

• 49:14Speaker 02

  They're good for your garden.

• 49:15Speaker 01

  I need to call a bee guy to just come in and just maybe take them. They're very, they look very healthy. I have two.

• 49:19Speaker 04

  The beekeeper.

• 49:20Speaker 02

  Are they hives that you have?

• 49:21Speaker 01

  Yeah, inside the post that I have in my backyard.

• 49:23Speaker 02

  Oh, that's awesome.

• 49:24Speaker 01

  Yeah, I just let them be.

• 49:25Speaker 02

  Oh, good. They're, they're really, really great.

• 49:27Speaker 01

  Yes. Yes.

• 49:30Speaker 02

  Another, another pun. We're full of them today. Well, thank you so much, John. Thanks for coming.

• 49:34Speaker 04

  Thank you for having me. Glad to be here.

• 49:36Speaker 02

  Want to remind all our list, remind all of our listeners, go subscribe to the Bakersfield, California. And it's a great, great information there. It's our local news that we all rely on. And John Cox did a great job.

• 49:48Speaker 01

  Yes.

• 49:49Speaker 02

  Appreciate it. Want to remind you, if you miss any of these shows, you can go wherever you listen to your podcasts and find us there. And remember these three things. Be smart, be safe, and always.

• 49:59Speaker 01

  Be money wise.

• 50:02Speaker 05

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