Review of PS land sales shows violations

At Wednesday night’s city council meeting, Palm Springs officials released the results of an independent review of the city’s redevelopment land sales.

A News Channel 3 investigation back in May examined one of those transactions, in which the city sold a piece of land called Casa del Camino to developer Richard Meaney while he employed Palm Springs Mayor Steve Pougnet as a consultant.

That sale has since been rescinded and prompted the city to commission the audit. Los Angeles-based firm Kane Ballmer and Berkman conducted the review and found several serious violations.

One of issues was with so-called “Prairie Schooner” lot near the Palm Springs Convention Center.

It was sold by the city to Orange County-based “Nexus Development” in 2011 for $1.5 million.

That same year, a city-commissioned appraisal of Prairie Schooner valued the land at $2.5 million. That value was never presented to the Oversight Board as required by law.

The firm recommended the city examine whether it can legally undo this sale.

“They never looked at the real value of anything,” said Frank Tysen, owner of Casa Cody Inn in Downtown Palm Springs.

Tysen says he’s tired of the city giving what he calls “sweetheart deals” to select developers. He’s also sued the city over the Downtown Plan under construction by developer John Wessman.

“Certain people get all these benefits and get all this public money and the rest of the community has to compete against that,” Tysen said.

The review also found a violation with a land sale that hasn’t been finalized yet: the Convention Center North Parking Lot. It’s the site of the planned Dolce Hotel.

The review says the land appraised for $4.4 million in 2007. The developer, CDI Ventures LLC agreed to pay $2.2 million for the land and an additional $2.6 million to replace the convention center’s parking which will be demolished during construction.

But the city omitted the appraisal and the parking agreement were also not provided to the Oversight Board.

The audit also found issue with the city notifying the public only three days in advance of a meeting to discuss a land sale when it was required to give 10 days notice.

“They keep trying to tell people that nothing wrong was done and of course a lot of wrong was done,” Tysen said.

Tysen was disappointed with city officials reactions at Wednesday’s council meeting when the review was presented.

“Our staff did a very good job under very arduous conditions and in it there are a couple of procedural errors,” said Councilman Paul Lewin, who requested the review back in May.

“I must compliment the staff, I’m very excited about this report,” said Councilwoman Ginny Foat, who is running for the mayor’s seat this November.

City Manager David Ready who’s on the Oversight Board couldn’t sit down with us for an interview and didn’t respond to our questions via e-mail. But Ready said in published reports that he blamed the errors on sloppiness and a confusing law.

“That’s a lame excuse, that’s why you hire good people. I think the problem is their orientation has been to help certain developers,” Tysen claims.

Foat told us by phone the report is good news and Lewin didn’t respond to our requests for comment.

“It’s not just Steve Pougnet. All five of them voted for it. We need to clean house and get them all out because we can’t function with a corrupt council,” Tysen said.

The city said last night it is working to clean up this process going forward and will correct its errors.