At the Anaheim Republican Assembly’s candidate forum this Wednesday, District 6 candidate Patty Gaby demonstrated astonishing ignorance of an issue that has been at the heart of Anaheim city politics for years: using TOT tax rebates to attract 4-Diamond hotel projects to Anaheim.
Earlier in the day, news hit the media regarding Disney’s request to cancel 1) the 30-year gate tax moratorium that was part of its agreement to invest up to $2 billion in the Disneyland Resort (including Star Wars Land) and 2) and the TOT rebate agreement for the 4-Diamond hotel project it halted last week due to the hostile business attitude of the city. The company again cited the toxic business climate emanating from City Hall.
Gaby – who was recurited to run several weeks ago by Mayor Tom Tait – greeted the news with elation in her remarks at the forum, saying “today was a great day” and gushing that Disney had “waved their white flag.” She credited Tait with “putting a little light” on the issue “so that we were all aware of what was going on.”
As a result, Gaby claimed, “We now have $267 million more dollars in our general fund” – money she later told the audience could be used to build more homeless shelters.
The $267 million figure is the estimated total TOT tax rebates for the fourth Disney hotel over the 20-year life of the agreement – but that’s only if Disney builds the 4-Diamond hotel project. No hotel, no TOT tax revenue.
The same thought occurred to a number of audience members upon hearing Gaby’s claim. One of them asked her: “You mentioned $267 million that we have now that we didn’t have yesterday. Can you explain that? Because I don’t think that’s true.”
“Well, that’s the subsidy that Disney had – part of the subsidy – that was their part,” Gaby replied.
That prompted another audience member to point out, “That money doesn’t exist. It hasn’t been generated.”
Gaby’s claim that ending the agreement magically deposits $267 million into the city’s general fund – money suddenly available to spend on homeless shelters and other projects – betrays an astonishing lack of understanding by a would-be city council candidate.
Disney has halted the hotel’s construction because the city was playing games with the economic assistance agreement. Now, Disney wants cancel that agreement – which doesn’t put one additional dime into city coffers, because there is no hotel to generate TOT revenue. Indeed, the city’s five-year budget forecast is predicated on the revenues that would have been generated by the 4th Disney hotel.
It’s understandable why Gaby thinks cancelling TOT rebates for a non-existent hotel project that is unlikely to ever be built (at least in Anaheim) swells the city treasury by $267 million. For years, Mayor Tait, Councilman Jose F. Moreno and his allies have repeatedly attacked the TOT rebates as “taxpayer giveaways” and misleadingly talk about them as if there is the city is writing checks to build these hotels. Just a few days before, on August 20, Tait spoke to the OC Weekly as if the money currently exists: “The $267 million is desperately needed to pay for our vital city services.”
So when one of those agreements its cancelled, its no surprise that residents who buy the “giveaway” claim will believe the city is suddenly $267 million richer.
While Gaby’s claim that “We now have $267 million more dollars in our general fund” is patently false, it’s flows from the logic of the ceaseless “giveaway” mantra from the Tait-Moreno camp.
It’s said that if you repeat something often enough, people will start to believe it – even if it is untrue. Gaby bought into the misleading “giveaway” mantra, and consequently came off as uninformed, unquestioning and unprepared to be a councilmember.