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Eric Reed: A Pinocchio Award Candidate

The Washington Post has been awarding annual Pinocchio Awards to the person in various disciplines who has told the biggest whopper (fib or lie) in the past year. The nominees are chosen and compared to the fictional Pinocchio, whose nose grew after each lie he told.Usually the winner from the political arena is a national or international figure. 

If we had a local political nomination in Belmont, I firmly believe that someone would certainly nominate Eric Reed, a candidate for the City Council, who wrote this on his Web site:

"Would you give up over $5 million dollars if someone offered it to you? Well, by saying no to CSUS, the City Council did just that.

Think of CSUS as an investment that pays a set amount of money each period: $250,000 per year. Plus, CSUS was going to pay $1 million down. This kind of investment is known as an annuity and you can use an on-line calculator to determine its value. When I did that calculation, I got an answer greater than $5 million dollars. Yes, $5 million.

With the road repair budget $27 million dollars in arrears, with the need to turf the sports complex, build Davey Glen park or fix the sewers, why did the Council say no to CSUS? What would you do with this kind of money if you were running the City?"
(End of quote)

Whether you are pro or con on the issue, you have to agree that the $1 million payment and the $250,000 per year were being deferred for at least 2 or more years (1 year after the first year of enrollment); this would calculate to be far less in present value. 

Moreover, Reed failed to mention that the City of Belmont would have approximately $120,000 of additional associated costs to service the school and an estimated loss of $50,000 from secured and unsecured taxes. And the worst part of the offer is the annual payment of $250,000 is fixed forever (with a maximum 2% annual escalator) while the City's costs grow each year due to inflation and expansion. In time, the City's cost to service the school could exceed the school's payment, which would compound the substantial loss of taxable property,

As far as the money going to to City projects, what money? The schools, fire department, community college, hospital, library, etc. that lose tax revenue because the school is tax exempt have to be supported, and after the City's costs exceed the $250,000, the City and the taxpayers are stuck with the bill. Rather than an annuity, this could be an impediment to the progress and financial health of our City.

Anyone want to second the nomination of Eric Reed for the Belmont Pinocchio Award?


This post is contributed by a community member. The views expressed in this blog are those of the author and do not necessarily reflect those of Patch Media Corporation. Everyone is welcome to submit a post to Patch. If you'd like to post a blog, go here to get started.

Justin July 02, 2013 at 05:02 PM
I'll second that nomination! He is known for stretching the truth a bit.
Steve Hayes July 02, 2013 at 06:02 PM
Joe I suggest you look in a mirror when you look for a dishonest person.
George Robinson July 02, 2013 at 06:18 PM
All good points which is why so many residents opposed the school in the first place. We need tax generating business in a business park not a school.
Joe Brennan July 02, 2013 at 06:46 PM
Steve, thank you for your incisive, detailed and cogent analysis of your personal feelings. An ad hominem attack without facts seems immature. Now, what do you have to say about the post.
Denny Lawhern July 02, 2013 at 06:47 PM
looks like this is pretty much a political hit piece Joe Brennan . Our Zoning Ordnance and our General Plan in Belmont should not be for sale to the highest bidder!!!!!
Rob July 02, 2013 at 06:59 PM
Go Eric Reed! Spot on. Time for change in Belmont. This topic will not be good for the good 'ol guard if they choose to run YET AGAIN! Keep bringing CSUS up Joe...it only favors those running for the much needed change Belmont needs.
Joe Brennan July 02, 2013 at 07:06 PM
Denny, I agree!!! "Our Zoning Ordnance and our General Plan in Belmont should not be for sale to the highest bidder!!!!!"
Joe Brennan July 02, 2013 at 07:10 PM
Ron, I think you underestimate the number of Belmont voters that don't want to sell Belmont to the highest bidder and suffer the consequences without end.
Rob July 02, 2013 at 07:15 PM
Belmont missed out HUGE on CSUS. That's why Coralin went back to CSUS to "make good" and save face after she voted it down. Kinda like the old Oracle deal we missed out on too that she had a hand I way back when. We lost all that tax revenue. So much good could have come from CSUS on Davis Drive. I see that other potential buyers have flocked to office park...nope...still sits vacant with no revenue to the City. Time for change!
Joe Brennan July 02, 2013 at 08:36 PM
Rob, you're missing the point. This post is not about CSUS, it is about a politician who is bending and stretching the truth about a subject important to the voters of Belmont for his own benefit. Or worse, it is a manifestation of an inability to understand crucial financial facts. Please post your opinion about the past decisions of our City Council on an appropriate blog. My hope is that all our candidates will tell it like it is and respect the intelligence of the electorate.
Belle July 02, 2013 at 08:38 PM
Rob is correct. The fact CSUS was turned down just shows how out of touch with reality our elected leaders are in Belmont. Both the public and privates schools are bursting at the seams. There is a huge demand for another middle school in Belmont, and once again the NIBMY mindset won out. For those who follow local politics, the vote was all too predictable. Has anyone noticed the crumbling roads in Belmont? According to the San Mateo Daily Journal, we have the second worst roads in San Mateo County just ahead of East Palo Alto. When I asked the Mayor about this, her quote was "The neighbors in Hallmark neighbors should get together and tax themselves to pay for repaving the Hallmark neighborhood." I have never heard of such a ridiculous answer. If we actually had tax revenue, we could repave the roads. However, if we keep turning down businesses in Belmont, we will never have money for our public schools and roads. Time for change in Belmont. Please vote for Eric Reed and Charles Stone come November 2013!!!!!!!!!!!!!!!!!!!!!!!!!
Rob July 02, 2013 at 08:58 PM
Joe, I get your point all too well. I will continue to post here or anywhere that will talk about our upcoming election. The past is VERY important as some of our current City Council members had their chance for huge tax revenue projects in the past and they turned them down. CSUS is another example of poor decision making on our behalf. And those who had a hand in those decision may run for election again. Everyone needs to be reminded. So I will stay on your blog or anywhere I see a chance to talk about CHANGE for Belmont. Charles Stone and Eric Reed are needed to help make our wonderful little city prosper.
Joe Brennan July 02, 2013 at 09:03 PM
Boo, please see my note above to Rob.
Rob July 02, 2013 at 09:33 PM
Joe, If you are going to blog about political topics with an upcoming election you better be prepared for those of us who are paying attention to post and get our opinions out as well. Sorry. It's part of the deal. The past is VERY important because Warden and Feierbach will most likely run again since we LACK term limits in our fine City. In the past huge revenue making deals were past on. Just like CSUS. Now more of us are paying attention and want serious change. Belmont has changed over the past 20 years. Our demographics are very diverse and Silicon Valley has grown too. We need our city to prosper. It's time. Charles Stone and Eric Reed are right for change. We need better leadership. The CSUS deal really brought this all up and woke many us up. So I am awake, paying close attention and will comment on your blogs all I want if you continue to blog about the election in our wonderful City. Do not direct me any where but here. Thank you. We all have opinions, just like you. You calling Eric Reed a liar in your blog is not cool. You may disagree, but that is not cool. So I am here to stay. We need change and I think YOU underestimate how many of us feel this way.
Belle July 02, 2013 at 10:21 PM
Rob, I agree calling Eric Reed a liar is a new low. Everyone please just don't blog on the Patch, get out and support Eric Reed and Charles Stone for a better Belmont! I do hope the CSUS debacle woke everyone up. It is about time.
Steve Hayes July 02, 2013 at 10:23 PM
Let get into some detail so we can determine who is really bending the truth. First Mr. Brennan points out that a present value calculation is the proper way to look at the value of the CSUS proposal. He is suggesting the $5 million figure is wrong. Anybody can calculate the PV of an annuity. Assuming 30 years and a 4% interest rate with and cash flow stream of $250K the PV is roughly $4.3 million and when you throw in the $1,000,000 one time payment you get over $5 million. So it is easy to see how Mr. Reed got his number. I am sure Mr. Brennan knows the answer the answer also but apparently he is trying to mislead everyone. Next Mr. Brennan argues the school would have cost the community $120K per year - again in an effort to twist the facts. The City calculated that a reasonable allocation of costs to the school would be $116K. However, when pressed for detail the City admitted there would be no INCREMENTAL cost increases - they were not going to add any staff or any other costs so there was no real cost increase. The largest single piece of the $116K was about $40K for Police involved training of students (something like the old DARE program) - the police would not be adding staff. The fact is the Police, Fire,City Schools (elementary and HS) and library got about $90K in annual taxes from the site and CSUS offered to provide $250K - more than 2.5X as much. In fact after the CSUS deal was rejected the Tax Assessed Value of the property was reduced by about 30% because the owner can not sell the property and now the community (the six organiztions mentioned above) only gets $60K. It would be better to get $250K per year rather than $60K.
Joe Brennan July 02, 2013 at 10:30 PM
Boo, I hope not.
Steve Hayes July 02, 2013 at 10:44 PM
Then Mr. Brennan complained about the 2% inflated attached to the $250K annual offer. Everybody's taxes can only rise a max of 2% per year, including mine and Mr. Brennan's. That is the max increase that any business has to pay. I guess Mr. Reed understands the concept but Mr. Brennan does not. Lastly. Mr. Brennan concludes there would be not money for projects because the cost of the school would be greater than the revenue. Again, if the City shared the $250K with the schools, library, police and fire everyone would have received more than 2.5x what they got before the project. Of course more can be done with more money - again Mr. Brennan is not telling the truth. My problem is that Mr. Brennan knows all of the things I mentioned above, but continues to distort the truth in an effort to support his agenda. Mr. Brennan complains that Mr. Reed is bending the truth, but all of his "support" is complete distortion. So who is the one with the long nose?
Belle July 02, 2013 at 11:57 PM
Please click "like" on Eric Reed and Charles Stone's web sites if you would like to support their campaigns. Thanks. Signed, Citizen for a Better Belmont https://www.facebook.com/ericforcouncil2013 https://www.facebook.com/CharlesStoneForBelmontCityCouncil
Joe Brennan July 03, 2013 at 01:43 AM
Steve, you are calculating the PV by using the gross payment of $250,000 and not the net amount of less than $50,000 per year. And you are calculating the PV of $1MM that is actually payable in two or more years. I still maintain $250,000 or $1MM payable in more than 2 1/2 years has a PV less than these respective amounts. The net figure has to take into account: —The cost of the City maintaining the campus ~$120,000 (despite your figures which are disputed), — the lost-tax revenue paid to "the Police, Fire,City Schools (elementary and HS) and library got about $90K in annual taxes from the site" —and any loss to the City when these costs exceed through inflation the 2% escalation clause and exceed the annual payment. (No estimate) This reduces the $250,000 payment far below $50,000. The $250,000 payment is not an annuity issued by an insurance company and not guaranteed with assets. You brought Prop 13 tax-increase rates into the discussion. That is a red-herring issue to divert attention from a bad calculation on a political Web site that was a whopper, but not a lie if there was no conscious intention to deceive the reader. It is interesting that you can state what is in my mind and what I know, as well as I am a liar. I would not be as presumptuous to judge whether you are honest or not, and if you are a liar, but it seems you are confused.
Belmont96 July 03, 2013 at 01:49 AM
For those of you who will say; this is not part of the discussion, Steve Hayes in two posts on this blog has stated that people are dishonest. Steve Hayes has a history of stating people make things up. Case in point: FYI to Ralston parents, when the custodian at Ralston was arrested and charged, Steve wrote that he knows kids at Ralston make up stories. What is that based on Steve? Now that that Andre has been convicted, I never saw an apology from Steve to the victim; especially after what he said: Steve Hayes 8:41 am on Tuesday, March 22, 2011 I have known Andre for many years and have worked with him - I doubt the accusation. If there was really a problem, the Belmont Police would have uncovered more examples of the behavior - he has been coaching thousands of girls over the course of 23 years. A problem I have is I know kids at Ralston contrive stories, mostly to get attention. The accuser is a child and therefore is able to make the accusation knowing full well that there is very little downside to making false statements. Of course I am against any form of sexual abuse but I am also against dragging a good person through the mud based on false cries of abuse.
Bita Shahrvini July 17, 2013 at 06:45 PM
It’s true that we cannot keep turning down businesses in Belmont, but we need to support smart businesses that will not end up costing the city more to maintain in the future, and Joe Brennan is spot on in calling out the Reed for manipulating the facts surrounding the CSUS subject. Some of you (Rob, Citizen for a better Belmont, etc) are failing to realize that a school is not a business. Schools do not pay taxes to the city, and thus they will not produce revenue for the city. Schools get tax revenue from the state government; however, they do not pay taxes themselves. Therefore, if CSUS was created, it would merely drain the funding allocated for other Belmont-Redwood Shores/Sequoia Union schools. @Citizen for a better Belmont: Yes, Belmont schools are bursting at the seems, but CSUS would in absolutely no way help the situation because it is a PRIVATE school. The majority of Belmont’s population cannot afford to send their children to private school. Moreover, since only people willing to pay the significant fee that comes hand in hand with the CSUS would be allowed to attend that school, CSUS would not help drive down the number of students in the public schools. Almost all of the students who attend public school come from families who are already unable to afford sending their children to private schools. When speaking to the belmont City Council, CSUS reps admitted that they anticipate only 4 students from Belmont and 2 from Redwood Shores to attend their new school if built--- that inconsequential decrease of 6 students will do nothing to help lessen the over crowding of students at Ralston.
Belle July 31, 2013 at 06:24 PM
Hi Bita, There are many families that can afford CSUS in Belmont. There are many dual income, high powered families in Belmont that already send their children to Belmont Oaks, Serendipity, IHM and Notre Dame elementary school. Belmont Oaks and Serendipity end in fifth grade. Plus, CSUS gives out $2,000,000 per school year in financial aid to those families that qualify, which is a very generous amount for a private school. CSUS is one of the top schools in the country. It is truly Belmont's loss that it was not voted in last fall. Another neighboring town will gladly snap it up....I will vote for Eric Reed and Charles Stone in November 2013. They support hardworking families with children in both the public and private schools! PS I understand that private schools do not pay taxes. However, if you go back and read the City Council minutes you will see the money they would give to Belmont on a yearly basis was very generous. Oh well, it is all water under the bridge now...Let the voters speak in November...

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