Tale of Two Bungalows

On the east side of the block of South B between 9^th and 10^th there sit a row of same plan duplexes, each consisting of two 2/1 of approximately 1K sq ft per unit, arranged on long, thin lots around 7500 sq ft. This weekend I went along with my friend Sam to inspect two properties with nearly identical layouts which she was considering for rent. What we discovered were such stellar examples of the Dr. Jekyll and Mr. Hyde of landlords the whole episode felt like a parody.

Both landlords have properties purchased long ago. Both landlords have properties which have been sitting empty for many months due to the slower rental market post-Covid. Both landlords had units with similar layouts on the same block. Here the similarities end.

At the first unit we were met by a sweet little old lady who had been chatting amenably with the tenant in the back unit. The unit she was showing was freshly painted, inside and out. The carpets were clean and recently vacuumed. The bathroom and kitchen were updated. There was an adorable back patio with the perfect orange tree (you have to pay extra for that). She explained how, in order to make the place more appealing, they had moved a few fences to enlarge the space. They had owned it for 40 years, she said, and you can tell she felt real affection towards the property.

The front yard, she explained, was in the process of being redesigned. She had tried for years to maintain a nice lawn, but she was ceding the war to the neighbor’s gophers. She would not, she insisted, make it plain stone. Her aesthetic ambitions were higher minded than a cheap stunt like that.

Finally, in a gesture which made me want to sell my house and move in myself, she apologized for the state of the windows, which did not appear dirty to me. Whoever moved in, the landlord promised, could set up a cleaning to suit their schedule. She would pick up the tab. For all this, she was asking $3150 a month.

Our next appointment was a few units south. The expectation was that this place would be cheaper, for a reason. It was purchased in 2000 by another landlord who has rented to friends for years. I understand that getting lower rent often requires compromise, but this guy, who I’ll call Bill, is beyond, in my opinion. Codes are broken. Service providers are sketchy. Fix times are extended. I mean, the man didn’t even pave their driveway after cars kept getting stuck in the mud. He bought a dump truck of gravel, which they had to spread out themselves. In San Mateo! Solidly into the 21^st century!

Anyhow, I was prepared for this unit to be down market from the one we had come from. Bill did not disappoint. As an indifferent young man (not Bill) opened the place for us to look around, I was instantly transported to the most beat up rural properties I have had the opportunity to inspect in person. The condition was deplorable.

The floors wood floors were scuffed. A tile was missing off the tub, which reminded me of what you might find in a cut rate hostel. Dark scum was apparent on the tile floors. The kitchen appeared to be original, and none of the cupboards closed all the way. The backyard was a tangle of weeds, and contained a rusted old shed, a barbeque covered in spiderwebs, and a large, broken screen. All this was going for $2700 and one month free with a year lease.

In the end, it is unlikely Sam will take either. Her timeline for moving out of her current place is flexible, as is the part of the Bay where she settles. A friend gave her the number of a property manager in SF, and insisted they were offering better deals than in San Mateo. For once, it is renters who have options, and they plan to exercise them.

 

*Please note, despite the ridiculous discrepancy in condition Redfin predicts their sale price to be within 1.5% of each other. Such is the power of stale data…

Feeling Bearish in a Bull Market

Perhaps the most famous naysayer to the notion a home is an investment is Robert Kiyoskaki. Per his seminal book, Rich Dad/Poor Dad, the conventional wisdom is bunk. Committing to 30 years of mortgage payments represents a liability, not an asset. Even when owned free and clear there are associated expenses, such as tax, insurance and maintenance. Sure, you can sell, but then where would you live?

Conversely, Kiyoskaki considers an investment a passive stream of income that is profitable today, not, potentially, at some nebulous point in the future. My boss in NYC had this discipline back in 2006 when the name of the game was pay now for income streams that will “inevitably” come to fruition as rents rise every single year forever. If he couldn’t get a little bit of upside from day one, he didn’t buy. Please refer to the new book Saving Stuyvesant Town: How One Community Defeated the Worst Real Estate Deal in History for an example of how you can make a few billion disappear in less than a decade by betting on future cash flows that never materialize.

While it may be a personally satisfying to watch your predicted value rise on the realty websites, you can’t eat equity. Having Zillow tell you your house is worth a million dollars more than what you purchased it for ain’t bad. However, it is a far cry from having a million dollars in the bank.

Americans loves to own their own homes. It’s our thing – an essential part of living the dream, we are told. According to Princeton University’s The Eviction Lab 45.67% of Californian’s rent. San Mateo County is a hair more, at 46.72%. Comparatively, an article published this week by Isacc Würmann on housing activism in Europe estimates population of renters in Berlin is 85%.

But does it actually make financial sense, based on the numbers, to own a home in the Bay Area?

For people who have only followed the Bay Area housing market it might be hard to believe that people in other parts of the country buy a home to save money on rent. If you are able to come up with the down payment in the rural Illinois town where I hold property, your monthly payment with mortgage and insurance on a 70K house is about $400. Rent on the equivalent home would be at least $900.

This could not be further from what is happening right now in the single family market in the Bay. Consider a comp which closed earlier this month. It was a cheerful little house on a quiet block in Shoreview (2/1, 820 sf ft house, 5250 sq ft lot). It closed at 1.14, for an estimated monthly payment of $7665 with a conventional mortgage. This is more than twice the estimated high rent of 3800 (Redfin).

How is this justified? Asset appreciation, they say.

On a base level, this is true. My favorite Illinois rental is predicted to have risen less than 7K since 2016, and this doesn’t take into account the 7K we put into it at purchase. However, it brings in a positive cash every month like clockwork.

Compared this to a home sold in San Mateo in 2016 which is said to have appreciated 533K in the same amount of time, or 38%. Yet one should take out the approximately 125K in interest paid in the first 5 years of the loan. Now, from the 408K remaining you can back out the commission at 4.5% of the sale price and you are down to a profit of approximately 319K, or 22% over 5 years. This also assumes no other capital expenses in that period (HA!).

Additionally, unless you sell, it is hard to call it an asset when the expected fixed monthly payment is over 7K a month and the expected rent per month during the equivalent period was around 5K. If you aren’t living there, you are losing actual money day in and day out for the benefit of counting on the future benefit of undeterminable gain. If you are living there, you still ought to back out the 2K a month for the 60 months you have been paying more to own than rent from the profits. Down to a profit of 199K, your return at sale would be predicted at closer to 13.7% over 5 years. The situation does not improve if you are subject to capital gains.*

If the psychic value of being a homeowner outweighs the math, go forth and own my friend. Ditto that if you have piles of cash or an overwhelming fear of inflation. Otherwise, Kiyoskaki’s point on the heavy liability of homeownership is worth considering in the heat of the current bidding environment.

 

 

*Yes, there may be SALT tax benefits to consider, but they have been capped now. Also not included in this model is the impact of closing costs, such as staging, as well as the unexpected costs of ownership which tend to crop up all too regularly, such as appliance replacement, mold mitigation, window replacement, yard maintenance...

 

Why Pay Over Market

If you fall in love with a house and can afford it, go ahead and pay more. If you have a strict timeline in a constrained market, go ahead and pay more. Money talks, as they say, and this is of course the number one way for the consumer to make themselves heard. When there is only one and you want it, strike.

However, are overbids always the result of irrational exuberance?

Back in 2017, as I went over the numbers in the Highlands, one data point stood out. It wasn’t the biggest overbid: 15% over ask versus a high of 34%. What got me was the price per. The low comp was $607 a sq ft, which correspond to the fact it was a very large (3790 sf) and stylistically…unique. The second highest comp was $1282 a sq ft, due to, I expect, the flat, nearly 10K sf ft lot accompanied by an almost vintage Eichler, always a selling point to the architectural purist out there. Finally, my outlier, which clocked in at $1515 per. WTF??? Why would anyone do that?

Back then, I raised an eyebrow, but let it go. People do all kinds of odd things in this world. Tacking on 18% more per than the other highest bidder isn’t that out there, especially when the total purchase price was within 1.3%.

Revisiting the data set, I went back to that question of why. Why did someone pay so much a square foot back then? How is it working out for them today?

First stop was the realty websites, followed by Google Maps. Results? The visual reveals a new building being framed.

We are dealing with a teardown situation. There are two typical cases of a total redo. There is the discerning homeowner who wants to create a dream home from ground up and has the patience, vision and means to do so. Then, there is the speculator, or flipper, in HGTV speak. The investor pays $1515 per for $1140 and has a basis of 1.727. The you rebuild at the non-retail price of, say, $300 per for 2300 and now your basis goes up to 2.417 – enough to maybe get you a visa thrown into the investment mix.

Assuming someone is willing to buy it for today’s average sale price in the Highlands ($1500 per says Redfin), you sell at 3.45. Subtract a discount commission, you are taking in over 875K. Given the timeline under consideration, that isn’t terrible, but nothing which couldn’t have been accomplished with some clever Bitcoin trades and a hell of a lot less headache. Another problem with the notion it was purchased to flip is that it still hasn’t come back on the market. Contractors who know what they are doing can bang out a mini mansion in 18 months flat. It should have hit the market by spring of 2021 if the plan was to sell.

My fallback assumption was that someone built themselves a luxe dream home, money be damned. My guess then, was the place would be, upon inspection, gorgeous, no expenses spared…because if you have the money and want it enough, why not. Knowing the photos available lag real life by many moons, I went to investigate.

Final answer?

Both of those scenarios were incorrect.

From what I can tell, they paid extra because they wanted THAT lot. If there is a big lot you really want which has a small house on it, you are in luck. Most folks will be paying simply for the house, maybe a little extra. Therefore, going a hard on the price per wins you the hand. I mean, the house…

Why did this lot get this financially well-endowed individual all geared up to break out the Benjamins (and then some)?

1)      Oversized (8640), which allows a higher sq ft rebuild

2)      Quiet block off a cul-de-sac

3)      Good school to attract long term family renters

4)      Corner Lot

Wait a minute! Corner lot? Since when was that a plus? Doesn’t it limit the backyard due to having two setbacks from the sidewalk as opposed to one?

Sure. But that only matters if you aim is maximizing the size of your bucolic oasis. Not everyone thinks that way. For example, if your goal is a low maintenance revenue flow, you are throwing some pavers in the yard and calling it a day.

Beyond that, the corner offers a special benefit for anyone seeking to turn a single residential house into a rental which operates more like a duplex. Because the house has two sides facing a street one may design it so there are two separate driveways, one on each. The tenants benefit from a sense of privacy, as well as twice as much off-street parking.

That is the new setup of my comp. After untold amounts of money on construction, it is a very plain looking building, with a utilitarian, rock strewn yard. There are two entrances and two driveways, one on each side. Both of the off-street parking spots were occupied by sensible family cars.

Under the assumption the owners of this place are now collecting not one but two revenue streams, both which should be superior given the particular configuration of the lot in question, why wouldn’t you pay a little more to ensure yours is the winning bid? As a percentage of the total project, the 229K overbid represents perhaps 10% of the total project cost (HA!). However, if you are now renting a 3/2 (Realtor’s estimate $4600 a month for a house in that area) as well as a one bedroom ($2185 average in San Mateo per Zumper) your monthly revenue has been kicked up almost 50%. In the long run, that makes sense to me.

 

 

Seeking Higher Ground

 

At some point in 2017 I considered buying a house in the Highlands area of San Mateo. I know this, because I recently came across an old list of comps from the area. All were sold in mid-2016 and mid-2017.

Out of curiosity, I revisited them all. 34 out of the 38 have not changed hands, and one was pending for its first sale. The other had two sales, and the last is so strange it warrants a column of its own. Given all the hype in the press about housing prices, would it surprise you to know that a full 10 out of the 34 are predicted (by the website Realtor) to have appreciated 20% or less in the last 5 years? If you remove the cost of the commission at sale using a discounted broker (call it 4.5%) the number bumps up to 13.

What about the upside?

The best projected return on a property was, at first glance, a whopping 60%, or about 12% a year, which is along the lines of what optimists say. Once you take out the commission, it drops to 53%. However, the property was purchased at a low price because of the abysmal condition. Even if they had only spent $200 a square foot for full renovations, which is optimistic, to say the least, it brings their basis from 1.6 million to just about 2.05. Now the projected return on the money is a hair under 20% in 5 years, which is a somewhat less glorious take home rate. The lowest projected return was 7% after commission over 5 years.

The second best rate of return was for a similarly unrenovated Eichler, purchased for $908 a square foot and a total price of 1.625. After a commission, the expected return is 46%, which isn’t all that bad if you like it a little retro. Otherwise, you have to start hoping a buyer rewards you above market for your improvements.

One comp sold on April 28 of this year for $2.55. It previously sold for 13% over ask, or 1.8, on April 19, 2016. Assuming no other costs (HA!), this is a return of about 635K, or 35% over 5 years. However, if it had sold for the Redfin estimated value of $2,242,713, that would be down to 19%. Throw in there the fact you were most likely paying more for your home per month than you would have in rent, the notion that this is your most valuable asset you can't go wrong owning becomes even murkier.

 

Update on My Favorite Comp (on Maple Street)

If you don’t want to overpay in real estate, it is important to know your objectives and your hold time in advance as much as possible. What are you trying to achieve? This answer is as various as the bids received. What is important is to not allow what might be a rational bid to someone else distort your view of what you should have spent on that asset.

What is most interesting to me about a comp is the story behind the data, as well as how that one little puzzle piece fits into the macroeconomy. Most transactions are unnoteworthy. They are part of the median, and regulate the data when the outliers threaten to trash its logic.

Which brings me to one of my favorite comps - as if I could pick one.

Nothing brings out the voyeur in me quite like a high-end flip. For one, they tend to set the market. Two, it is like HGTV live.

So it was that in the spring of 2017 a house for sale in San Mateo caught my eye. Sold for 1.65 at the end of September of 2016, it had been rehabbed within an inch of its life in a mind boggling six months and relisted at 1.995 at the end of March 2017. It went pending within two weeks and closed in nine days for a huge (at the time) 2.4 before the end of April. The home was immediately listed for rent on Craigslist for 6K a month.

This is all so delightfully juicy.

First, let’s start with the flipper, who absolutely knocked it out of the park. The work was perfect for the discerning buyer, whether homeowner or investor. The school district was very desirable. The buy price was judicious and under ask. The sale price didn’t go overboard. If their work timeline was a sprinter, it would be Usain Bolt.

With a total hold time of less than seven months they took in ¾ of million dollars. Unless one goes too hard on the high-end finishes or personal style front, which they did not, anyone generating a gross return of 100K a month is probably making a decent money.

On to the buyer…

At that moment in time, 2.4 was an astounding price for a single family home on a corner lot of a busy street, hot school district or not. Beyond that, the time pending gives you another bit of information, because nine days is not the speed of an underwriter. Only cash closes like that.

The rent requested for this gorgeous home, 6K, was under market - designed for a quick rental and stable tenant. This indicates an investor wants to treat the asset more like a bond than an equity. They found a tenant at that price with ease.

Looking at the math:

Cost = 2.4

Annual costs on cash with a tenant paying all utilities include tax and insurance

 

 

Tax: Max 30K a year

Per the Internet, taxes have been running about 30K a year. However, we cannot truly understand the tax cost of the buyer. The urgency of the bid suggests a 10-31 swap, which gives a buyer a very limited window in order to identify a property. Such a bidder has an incentive to ‘overspend’ in order to ensure they preserve an important tax advantage.

Insurance: Roughly 6K a year

Assuming no costs on the house for a few years given its updated status (HA!), and no property management fees, which is questionable for an investor with enough sophistication to go flinging 2.4 million around, the best-case scenario for the cash flow on the investment at 30K per year of tax would be 3K a month, or 1.5% on their money. If the owner instead paid 10K a year on tax, this perks up to 4.66K a month, or about 2.3%.

As for the so-called market value of the home today?

After a roller coaster of valuation predictions, Zillow reckons it is a hilarious $2,415,981.

Oct 2017 – 2.23

June 2018 – 2.14

Dec 2018 – 2.075

Feb 2018 – 2.4

Sept 2020 – 2.26

Jan 2019 – 2.045

June 2019 – 1.84

June 2019 – 2.75

Oct 2020 – 2.24

Mar 2020 – 2.91

Jul 2020 – 2.27

Final Answer?

No one knows. Unless the investor gets bored of the cash flow, can’t rent for an extended period of time, or suddenly needs to access the capital behind what has to be one of many financial instruments they have available by selling alone, we aren’t going to find out anytime soon.

San Mateo City Council Candidate Summaries, 2017

Some thoughts on the seven candidates whose names will be on the ballot for the San Mateo City Council election on November 7, 2107:

These reflections are informed by six years of active engagement in San Mateo’s affairs, my current role as Public Works Chair, the statements of the candidates (available here - http://www.cityofsanmateo.org/2352/Meet-the-2017-City-Council-Candidates), and the candidates’ presentations at 2 out the 3 organized candidate forums.

These are my personal opinions.

Kara Cox

Evaluation Parameters*

I have based my evaluation primarily on two key parameters – Civic Experience and Follow the Money.

Civic Experience

In my opinion, experience in government is essential for a City Council Member. The notion of sending someone into a government position without intimate knowledge of the role they are confronting has proven detrimental in Washington. Let’s not experiment by sending someone unexperienced to San Mateo City Hall, which is complex and unyielding in its own way.

Follow the Money*                                                                      
My bias leans heavily towards grassroots candidates (defined here as receiving less than one third of their funding from businesses or unions). I like to see the majority of campaign financing donated from local residents or the candidate him or herself.  I don’t mind business, union or real estate interests per se, but major funding from outside the city should be looked at with a critical eye.  

* Data set pulled Oct 9 - totals have changed. For up to date reports on current contributions and loans please link here - https://www.cityofsanmateo.org/3739/24-Hour-Campaign-Contribution-Reports 

Candidate Summaries

Rick Bonilla   - http://www.bonillaforsanmateo.com/

Neighborhood: Hayward Park

Civic Experience: Strong

Bonilla has been closely involved with shaping the affairs of our city for over twenty years. His first major appointment was with Bay Meadows/Transportation Corridor Citizens Advisory Committee so he has been involved with the new development at that location since the beginning. This kind of deep knowledge of the history of San Mateo is invaluable for a City Council Member. I admire his gradual ascent to the Council as it allowed him to really learn and understand what is and is not possible in the context of City Hall.

Another quality that I like is that Bonilla is active and outspoken support of all San Mateo citizens, not just homeowners. He is an active supporter of unions and the equity value of all workers receiving a living wage. His leadership with regard to establishing Peninsula Clean Energy was critical for its success.

Follow the Money:

So far Bonilla has raised around 27K. Approximately half of Bonilla’s campaign funds come from unions. Individuals make up around a quarter of his donations. Real estate interest represent around 15%.

Summary: I support this candidate without reservation based on his experience and commitment to helping all San Mateo citizens.

Chelsea Bonini - http://www.chelseabonini.com/

Neighborhood: Beresford/Hillsdale

Civic Experience: Good

While I have not met Chelsea, I have heard only good things about her time on the San Mateo Foster City School Board as well as her standing and reputation within the Democratic Party. As with municipal government, leaders at the school board must engage with stakeholders with diverse opinions and high expectations. From my understanding, she has approached this challenge with bravery and determination. Link here for her detailed list of her accomplishments -

 http://www.chelseabonini.com/images/55460/Chelsea%20Resume%207.30.17.pdf

However, while there are definite parallels between the school board and city government, there is nearly no overlap in terms of personnel and process. It is for this reason I cannot truly unpack the extent of Bonini’s accomplishments on the school board, nor how she would adapt to the new challenge of Council Member.

Follow the Money: Grassroots Certified

So far Bonini has raised approximately 18.5K in order to run. Slightly over half of this is loans. Slightly under half comes from individual donors. She has taken no money from real estate interests and only a very small percent from the business community. 

Summary: While I do not doubt Bonini’s ability to be an ethical leader, as a Council Member she will face the additional challenge of no prior city hall experience

Mark DePaula - https://www.facebook.com/mdforsmcouncil/

Neighborhood: Not included in campaign materials

Civic Experience: Not Clear

At the one candidate forum he did attend, Mr. DePaula stated he is running on a staunchly anti-growth platform and wants a moratorium on all new constructions. He apparently has no previous experience in City government. He did not attend the second forum despite confirming that afternoon. At present there is no candidate statement or statement of qualifications available.

Follow the Money:

As this candidate plans to raise less than 2K detailed filings are not required.

Summary: Nonviable

Charlie Drechsler - https://www.facebook.com/sanmateostrong/

Neighborhood: North Shoreview

Civic Experience: Strong

Drechsler has deep roots in the community and has regularly served in leadership roles in pursuit of the good of his community. He held multiple terms as President of the North Shoreview Neighborhood Association as well as Block Captain for the Citywide Neighborhood Watch Board. In his capacity as a city worker, Drechsler has been elected by his peers as union president. He supports increasing the minimum wage. His vote against accepting a settlement from SPI was crucial for preserving the Bridgepointe ice skating rink.

In terms of direct experience working with the City of San Mateo, Drechsler has a lot. Over the past 16 years he has been on several commissions: Community Improvement (6 years), Public Works (5 years) and Planning (entering 5^th year).  He has served as the Chair of all three.

Follow the Money: Grassroots Certified

So far Drechsler has raised approximately 8K. Slightly under half is loans. Half is from individuals. He has taken no money from real estate interests and only a very small percent from the business community.

Summary: A grassroots candidate with a long and diverse track record for leadership and community service

Joe Goethals - http://www.joegoethals.com/

Neighborhood: Not included in campaign materials

Civic Experience: Strong

Goethals has been a Council Member since 2013 and has previously served as Chair of the Public Works Commission, as well as the Director of the Peninsula Health Care District. He is balanced, sympathetic and has the chops to do the job. He has a tremendous wellspring of faith in the good of people and is not the sort who rushes to judgement. Instead of quick, reactive solutions, Goethals diligently probes multiple perspectives before suggesting a course of action.

A key player in the nearly impossible task of finding a compromise which would allow the San Mateo ice skating rink to stay open, Goethals delivered on his promise to help and the ice rink has been reopened. These actions displays an incredible commitment to using the clout of his office in support of the agenda set by the citizens he was chosen to represent.

Follow the Money:

So far Goethals has raised a little over 41K. A little under half comes from individuals. Union support accounts for just under 20% and real estate interests make up just over 20%.

Summary:  An established and talented politician willing to put in the work

Robert G. Newsom, Jr. - https://www.robertnewsomjr.com/

Neighborhood: Sunnybrae

Civic Experience: Weak

Newsom has some limited experience with city government given time spent on projects for San Francisco, but has held no position or appointment related to San Mateo. He is open about wanting to pursue a measured growth agenda due to the impacts he and his neighbors are experiencing around the Sunnybrae. He also voiced support for a higher minimum wage. He attended both forums and seemed comfortable speaking in public and passionate about serving San Mateo.

Follow the Money:

As this candidate plans to raise less than 2K detailed filings are not required.

Summary: I think he would make an amazing city commissioner and hope he pursues other opportunities to get involved with helping his neighborhood

Eric Rodriguez - http://www.ericrodriguez.com/

Neighborhood: Aragon/Baywood

Civic Experience: Weak

I have met Rodriguez. He is clever and witty and I bet he is an outstanding Little League coach. I like that at the first candidate forum he highlighted the need for addressing the pension imbalance, which is a massive expense slowly inundating our city budget.

His experience with city management is limited to 2 years on the planning commission and he was passed over for the position of Chair by a vote of 4-1 by his peers. Rodriguez voted to accept money in exchange for rezoning the ice skating rink. He is running a glossy campaign, but, for me, substance is lacking.

Follow the Money:

So far Rodriguez has raised almost 70K. This is nearly double Goethals, who is the second highest fund raiser. Over half of his money comes from real estate interests. The National Association of Realtors (based in Illinois) and the California Apartments Association (Sacramento) have spent over 21K in support of  the Rodriguez’ campaign. No other candidate has recieved more than iK from these entities. Overall, over 50% of the total funding for Rodriguez has come from real estate interests. He has raised nearly 10K (approximately 15%) from out of the state while no other candidate recieved any funds from outside California. Less than a third of his donations come from individuals. He has negligible support from unions. 

Summary: With more years of civic engagement, Eric may prove himself worthy of a public office in San Mateo, but to vote for him now you must prioritize potential over actual track record and consider whether his major financial backers are in tune with your interests.

*Outline of My Most Prominent Biases

Bridgepointe Ice Skating Rink (Now reopened as Nazareth Ice Oasis)

The impetus for Joe Goethal’s dedicated negotiations to reopen the ice skating rink was Charlie Drechsler’s vote against a buyout (in addition to the votes of Commissioners Ebneter and Whitaker). Voting against a big pile of money in favor of an ideal takes guts. Committing yourself to finding the impossible solution takes dedication. Together Goethals and Drechsler delivered an amazing win for the community. While he was a Planning Commissioner Bonilla was so voracious in his denouncement of the rezoning he was forced to recuse himself from further meetings on the matter.

Issues over Party

My ideals lie in a time when party affiliation was a marker of how you lean as opposed to how you necessarily vote. I am not a member of the Democratic Party out of protest of their exclusive hold on Californian politics. If we are all Democrats what does it mean? If I figure it out, perhaps I will reconsider.

If you are into voting party line, your go-to-candidates Bonilla, Bonini and Goethals. All the candidates running are doing so as Democrats. The candidates endorsed by the Democratic Party were found to hold ideals most closely aligned with the overall principles of the party. Link here for their full recommendation -
http://www.smcdems.org/smcdems_endorsements_2017

Rick Bonilla

A mentor and friend for many years, Rick is a demonstration of the highest ideals of a public servant. His record is clear and consistent and his ideals unwavering. While no one is infallible, Rick is pretty close. So yes, I am a biased about him.

Letter to the Planning Commission, PA17-034

Dear Planning Commission,

I am writing tonight in to support 4 changes to the existing plans for the new sewage treatment plant; size, location, decentralization and sustainability.

1)      Size

The proposed plant, 78 million gallons per day, is far larger than necessary if measures are taken to seal the laterals and mains which have failed. Shoring up the whole sewage system will result in smaller peak wet weather flow predictions, the outcome of which would be the option to reduce the size of the proposed plant’s capacity. This would result in significant savings for the city, both in terms of capital outlay but also annual maintenance expenses as a larger plants uses more energy.

2)      Location

There are key shortcomings of the proposed plant’s location. Primarily, its location at the bay front is questionable. San Mateo County has been deemed the number one county in California at risk due to sea level rise. Placing the city’s sole sewage treatment plant in the direct path of where water is projected to inundate the coast is a risky proposal. And, even if we accept the existing site is the most satisfactory under expected conditions, it is essential that the plant be elevated as much as possible in order to avoid a catastrophic citywide failure.

3)      Decentralization

The most progressive practice advanced in the area of waste water treatment today is for processing to be dispersed throughout the city. There are two key benefits to this model. One, energy use is cut down due to the decreased distance waste must be pumped for treatment, resulting in annual cost savings. Two, having several substations dramatically reduces the likelihood of a citywide failure.

4)      Sustainability

Given San Mateo has no emergency water reserves, it is critical our waste water treatment plant process water to the level it is clean enough to drink, as well as keep supply available in the case of a disaster. Having multiple plants in dispersed locations with this capability would be the safest option to ensure the health and safety of our residents in all circumstances.

Thank you for your time and consideration