CVIndependent

Sat11252017

Last updateWed, 27 Sep 2017 1pm

It’s official: Palm Springs now has the highest sales tax in Riverside County. Thanks to newly approved Measure D, the rate will be 9.25 percent. The half-cent sales-tax hike will bring in an extra $6.7 million annually, according to estimates.

Voters in November also approved Measure E, a new tax on recreational marijuana.

These new revenues will be coming into city coffers along with, among other revenue sources, funds from Measure J, the one-cent sales tax increase approved by voters in 2011.

Measure J has indirectly led to a lot of bad publicity for the city—because some of those funds were and are being used for the now-coming-to-fruition downtown redevelopment project that was embroiled in the shady dealings that led to the arrest of developer John Wessman and former Mayor Steve Pougnet on bribery charges.

With an entirely new City Council taking office over the last two years, it’s worth taking a look at those Measure J funds, as well as the whole city budget—a budget that is, according to many observers, not so transparent and very hard to understand.

Palm Springs, with 47,000 residents (and a lot of visiting tourists), has a general-fund budget of $110,130,162 for the fiscal year 2017-18. However, the city’s various special funds actually total more than the general fund—bringing the total fiscal-year budget to $229,966,656, an amount confirmed by City Attorney Edward Kotkin, although he added that the amount has yet to be audited.

Figuring out what’s going on with all of these special funds is nigh impossible. I spent several weeks trying to get information from the city’s director of finance and treasurer, Geoffrey Kiehl. After not getting a response, I reached out to Councilman J.R. Roberts.

Roberts said there are 64 separate special revenue funds. “I had to look that up,” he said.

Why are there so many funds—totaling an amount more than the general fund?

“Unlike most cities in the valley, Palm Springs has an airport, a sewer treatment plant, a convention center, etc.,” Roberts said.

Of course, having so many separate funds raises questions about transparency and fiscal responsibility. Roberts responded that city’s website OpenGov website is easy to navigate. He also pointed out that Measure J funds are under the strict supervision of its oversight committee.

“Once the Measure J oversight committee has made its recommendations, the money is moved to the various projects that were decided upon,” he said.

However … if everything concerning the city’s use of Measure J funds is clearly posted on the city website, how did the fund end getting FBI attention, including a raid at City Hall? Robert Stone, a self-proclaimed FBI informant and constant city-government critic who unsuccessfully ran for the City Council this year, said one of the problems is that the public is only able to find out how the funds were spent after the fact.

“The Measure J funds are controlled by the city manager and the council, with recommendations from the Measure J Committee,” Stone said. “The reasons behind who gets what are not always clear, and disbursements are pretty much at the discretion of the city manager for smaller disbursements, and council for the larger disbursements.

“We only find out how the funds have been administered at the end of the fiscal year,” Stone said. “We never know in advance where the Measure J money is going. We only find out as the transfers are made.”

As for the new Measure D funds: In their pitch to voters, city officials claimed the funds would help the city maintain essential city services, such as public safety. However, it’s unclear what the city will do to handle its huge long-term pension obligations.

“Measure D does nothing to address the ongoing $220 million unfunded pension and health care liability of the city,” Stone said, claiming that the burden from pension and health-care liabilities will bring the city to its knees if it does not fundamentally change the way it does business.

One common complaint about the city budget: generous salaries. In recent years, Palm Springs City Manager David Ready has been the Coachella Valley’s highest-paid public official, with salary and benefits totaling more than $420,000. However, the problem extends well beyond Ready: According to TransparentCalifornia.com, 68 city of Palm Springs employees earned more than $200,000 in pay and benefits in 2016—and when these employees retire, they’ll be in line for huge pensions. Councilman Roberts confirmed that former Palm Springs Police Chief Al Franz, who retired in December 2015, is receiving a pension of $189,083 per year.

In other words … when it comes to transparency and getting the city budget under control, the all-new Palm Springs City Council has a lot of work to do.

Published in Local Issues

The spot that once was home to downtown Palm Springs’ Desert Fashion Plaza—and before that, the legendary Desert Inn—is under construction. It’s slated to eventually become home to a shopping center and a Kimpton Hotel, under the direction of developer John Wessman.

One man has been leading the charge against the project as it is planned: Frank Tysen, the owner of the Casa Cody Bed and Breakfast Inn.

Because of his opposition to what many consider “progress,” some city officials—most notably Mayor Steve Pougnet—have harshly criticized and even demonized Tysen, who has been a fixture in various Palm Springs development battles now for more than two decades.

On Jan. 16, during his State of the City speech, Pougnet issued his most vicious public attack on Tysen to date. He referenced a series of letters that Mike Depatie, the CEO of Kimpton Hotels, was supposedly sent by Tysen and Tysen’s colleagues. Pougnet characterized the letters as “vile.”

“You know what that reminds me of? ‘We don’t want people here,’” Pougnet. “It’s something we got over in Palm Springs. We’re over it: ‘We don’t want Jews; we don’t want gays; we don’t want blacks; we don’t want Agua Calientes.’ We’ve moved past that kind of rhetoric that Frank Tysen continues to spew.”

Given all the controversy surrounding the proposed Hotel Palomar, the Independent decided to take a closer look at Tysen, his motivations and his future plans.

In a recent series of interviews with the Independent, Tysen denied sending any letters to Depatie that were in any way hateful or vile. (More on that later.) We found Tysen to be far from hateful; in fact, he comes off as polite and even charming. He’s also brilliant: In 1966, he was a Guggenheim Fellow due to his work in architecture, planning and design.

While Tysen is passionate, knowledgeable, resourceful and opinionated, he also has a point of view on the city of Palm Springs that may very well be antiquated. Most notably, he criticizes attempts by some city officials and business leaders to aggressively pursue business from younger professionals.

“The stupid thing that goes on is that City Hall has become obsessed about bringing in the millennials,” he said. “What makes this town work is basically an older crowd, because the older crowd has the time to come in mid-week; young professionals don’t have the time to come in mid-week, because they work.

“Every year now, they’re putting on this rock concert called Tachevah that they call a block party. I went there last year to take a look, and I saw all these youngsters from Coachella and Indio. These aren’t people who are staying here; it’s not going to fill the beds during the mid-week.”


About 25 years ago, Frank Tysen and his business partner were shown the Casa Cody Bed and Breakfast Inn. Tysen immediately fell in love.

“I thought it would be fun to have a little hotel here,” Tysen said. “(Palm Springs) was dead at the time, and there was nothing happening. Palm Springs was at a real all-time low in the ’80s.

“People complain now, but there’s nothing to complain about, because the town is hopping,” he said with a laugh.

“I loved the whole feeling of the place and the natural beauty, but also the lovely architecture, the beautiful estates, and so on. (Casa Cody) was in shambles because it was run like a flop house. We saw the potential and started to restore it. It’s been a nonstop restoration ever since. We’ve added three other properties … over the years.”

Over the last two and a half decades, Tysen has watched as Palm Springs has evolved.

“Several people came to the city (around the same time that I did) and started picking up the old inns and fixing them up,” he said “Basically, that started what I believe is the revival of Palm Springs in the ‘80s and early ‘90s. People started to discover it again.”

Flash forward to November 2011, when voters in Palm Springs approved Measure J, a 1 percent increase in the sales and use tax, with that money dedicated to the revitalization of downtown Palm Springs. Tysen said he was supportive of the measure.

However, as plans for the old Desert Fashion Plaza emerged, Tysen soured on that portion of downtown redevelopment. One of his main complaints involves the design of the Hotel Palomar, slated to be operated by Kimpton. In particular, the modernist design and height of the hotel was questioned and opposed by Tysen. (Most reports say that the hotel is slated to be six stories tall; however, Tysen insists that he’s seen plans showing the hotel could rise up to nine stories.)

In May 2013, Tysen and his group, Advocates for Better Community Development, filed a lawsuit to block hotel construction; the group also started to collect signatures to force an election on the hotel plans. The group eventually submitted 2,700 signatures—seemingly enough to send the matter to voters. However, the city refused to place the matter on the ballot, claiming the issue was not subject to voter approval. In December 2013, a Riverside County Superior Court judge ruled in the favor of the city; Tysen and his group appealed.

Then came that Jan. 16 State of the City address by Mayor Steve Pougnet. In addition to calling out Tysen’s “rhetoric,” Pougnet shocked the crowd by announcing the city would send the hotel decision to voters after all—during an April special election.

Then on Jan. 29, the city made yet another about-face, agreeing to pay Tysen and ABCD $50,000 (apparently to cover legal fees) to drop the lawsuit, and canceling the April election.

Tysen said he decided to drop the lawsuit because it felt like the right thing to do.

“At that point, there was such a show of hysteria,” said Tysen, who reportedly received a death threat after the State of the City speech. “The city, especially, approached me to drop it. So I tried to look for another way we can solve these problems.”

However, that doesn’t mean it is clear sailing for the redevelopment of the old Desert Fashion Plaza: A remaining lawsuit, also filed by Tysen and ABCD, challenges various approvals of and changes to the redevelopment project.

As for Pougnet’s claims that Tysen and his fellow hotel opponents were sending rhetoric-filled letters to Kimpton hotels, the matter remains unclear. However, Tysen provided the Independent with a copy of a letter that he sent to Mike Depatie, the CEO of Kimpton Hotels. The letter is well-written and politely lays out Tysen’s concerns about the hotel, with no “vile” rhetoric to be found.

“I am very much aware of the wonderful reputation of your company and the sensitive way in which you have fit your hotel in historic areas such as Alexandria, Virginia, and I hope for something like that,” Tysen wrote. (See the letter for yourself at the story's bottom.)

The Independent left multiple messages with Pougnet to discuss Tysen and his opposition to the downtown redevelopment project; the mayor did not return the calls.

What is the point behind Tysen’s opposition to the hotel? He said it’s all in the design.

“The whole thing started off fine,” Tysen said. “Everything looked like it was going to be exciting. There was no mention of a nine-story hotel in the visioning sessions. It was completely different and looked very European, very low-key; they talked about world-class architecture. … Then, suddenly, the mayor decided to drop the eminent domain and started working with a developer (John Wessman), and what came out of that had no relation to the visioning sessions.”

Tysen insisted the architecture is not appropriate for Palm Springs.

“If you see the pictures, it looks more like downtown L.A., in the area near the Staples Center,” Tysen said. “It certainly doesn’t look like Palm Springs. … It’s really nothing that people are going to come and look at. It’s a glass box.

“The whole thing is very dense. Also, the whole surrounding retail … is another stupid thing to do, because we already have so many vacancies that haven’t been filled. To add another couple hundred thousand feet of retail makes no sense.”

Several times, Tysen insisted that the voices of tourists and part-time residents are being ignored—in part because they are unable to vote in local elections.

“The tourists are shocked,” Tysen said. “Unfortunately, they don’t have any voice in it. If they asked the tourists, they wouldn’t build it. Somehow, there’s a group of people in town who are so tired of nothing happening for 10 years, that now, suddenly, they think we should do anything that comes along. To me, it’s something you just don’t do. You do the right thing instead. … The people who are really affected don’t vote here. The tourists and the second homeowners—all these people coming in don’t have any idea of what’s going on.”


Some of Tysen’s critics have speculated he is fighting to protect his own interests, because his hotel is just a few blocks away from the redevelopment site. Tysen insisted that’s not the case; he said he simply believes that the hotel is a bad fit for Palm Springs.

“If anything, we might get more business if people walk around, and they see a small place that looks charming,” Tysen said. “It’s going to affect the feeling of the town and those who do or do not come here. The world is getting so crazy, crowded and congested, and right now in L.A., you can’t even move around anymore. People go to places like Catalina, Carmel or Santa Barbara to get away from all that. People come here to savor the nature of it, and also the feel of a small town. To have this thing sitting in the middle of it—it’s a terrible mistake.”

Tysen also said he believes the proposed hotel and shopping center are bad ideas because the millennials who are coming to the city are not spending any money. He claimed that most of the corporate hotel chains in Palm Springs are suffering through too many vacancies.

“The average occupancy at the Hyatt Hotel in Palm Springs is no more than 50 to 60 percent,” Tysen said. “Palm Springs, like many resort cities, is a seasonal town. The high season is February, March and April. Most of the hotels fill up during those few months of the year. With the young market, the Hard Rock Hotel was selling rooms in November for $59 a night during the middle of the week, and that’s the ‘hot, crowded Hard Rock.’ The Saguaro was selling rooms for $69 during the middle of the week in November. The Riviera was selling Thanksgiving for $109. There’s a lot of foolish stuff going on. This would be a big, subsidized thing.”

The Palm Springs Bureau of Tourism did not respond to requests from the Independent for demographics and specific hotel-vacancy information.

“You can’t do everything, and I think … Palm Springs has spontaneously become very popular with young people. They enjoy coming down here, so we’re doing fine, and I’m not worried about it. But these people who say, ‘We need more millennials!’ don’t understand that they have no time or money to spend in the hotels!”

Tysen claimed Palm Springs’ quiet, lovely nature attracts more visitors than anything else.

“Everyone is so impressed by what’s going on at the Coachella festival once every year. Coachella is Coachella, but Palm Springs is Palm Springs. There’s no one at the Palm Springs International Film Festival under the age of 40. Don’t kill the goose that lays the golden egg! Don’t kill the flavor of the whole town.”


John-Michael Cooper, the general manager of Palm Springs Rendezvous and the president of Small Hotels of Palm Springs (SHoPS), has worked closely with Tysen, a fellow SHoPS board member. He said portrayals of Tysen as a radical are off-base.

“People judge Frank in a very general way,” Cooper said. “There are a lot of things about (Tysen) that are completely ignored.”

Cooper said he’s worked with Tysen on various matters for five years now. While he does not always agree with Tysen, Cooper said he has a lot of respect for him.

“He’s one of the founding members of the association of which I’m now president of, and he’s a very skilled hotelier,” Cooper said. “We’re all in favor of Measure J, and he’s been very accommodating. But he is very motivated in what he does, and he’s super-passionate. I’ve agreed with him on a lot of sides of this thing that is known as Measure J. I can’t say I think one way or the other about (the proposed hotel and shopping center), because it is pretty multi-faceted—but I have a lot of respect for Frank.”

Tysen said people are quick to make assumptions about him.

“The real sad thing is there are a lot of people who have a lynch-mob mentality,” said Tysen. “You know, ‘Oh, let’s go get him—the son of a bitch! He’s stopping progress and everything.’ Most of the time, they don’t even know what’s going on; they don’t even know the issues. It’s scary to see people crawling out from under the rocks. I came to Palm Springs because I liked what I see. I don’t know why they came to Palm Springs—they could have gone to Las Vegas if they liked that kind of stuff.”

Make no mistake: Agree or disagree with Tysen, he’s no dummy. In fact, before he became a hotelier, he had a long career in urban design, planning and architecture. He also has a history of public opposition to controversial projects.

“I taught for many years at USC in urban and regional planning. I have done lots of studies about all of this. I was a Guggenheim Fellow, and I spent time in India (working) on master-planning in Calcutta. I worked with Gov. Ronald Reagan and had a lot of impact in not moving the (main L.A.) airport from Los Angeles to Palmdale. I was very instrumental in stopping the freeway that was going to go through Malibu and Santa Monica, and I stopped two oil refineries when I was on the … environmental council, in Beaumont and Banning. So I’ve tried to protect the environment all throughout California. It’s not just that I own a small hotel.”

He also took credit for helping make Palm Springs a successful destination.

“The reason this town is so special is because people like me have fought these battles,” Tysen said. “It starts when Nellie Coffman owned the Desert Inn (which was located on the Desert Fashion Plaza site); they fought an asphalt plant that was going to be up the street. There was a group here called Citizens United that had a building moratorium here.

“All kinds of battles have been fought. Pearl McManus would cancel an escrow if somebody built something she didn’t like. All this stuff has been going on, and that’s why this town is special. It isn’t special by accident. Otherwise, it would look like Beaumont, or it would look like Fontana. It’s special because people like me have fought these battles.”

Photo by Kevin Fitzgerald

Published in Local Issues