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Schwarzenegger Makes Stop In San Diego To Promote State Budget


Aired 10/8/10

California Governor Arnold Schwarzenegger made a stop here Friday to praise the passage of a state budget.

— California Governor Arnold Schwarzenegger made a stop here Friday to praise the passage of a state budget.

The governor pushed the idea of California creating a rainy-day fund to protect state services when the economy dips. He also praised the pension reforms written into the budget, which Schwarzenegger said will save CalPERS up to $100 billion in the coming years.

"The pension has become, really, the silent thief I call it of our treasury. It takes money away from existing programs, from programs that we all love, like higher education, kindergarten through 12th, public parks," he said.

Schwarzenegger said last year the state spent more on pension than it did on higher education.

The governor also addressed the possible sale of the Del Mar Racetrack. He said the government shouldn’t be in the real estate business.

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Avatar for user 'bulldog2221'

bulldog2221 | October 9, 2010 at 4:46 a.m. ― 6 years, 5 months ago

Nobody should be in the real estate business if they know nothing about real estate. This does not mean, however, that they should just give away their real estate assets for pennies on the dollar. Speaking of which, the value of the Del Mar Fairgrounds apparently has been estimated based on the current income production. Any shavetail real estate school graduate knows that value should be based upon POTENTIAL income rather than historical income of underutilized property. "Gross Rent Multiple" or GRM, is a valid amateur guesstimate tool only if the property has been developed to its "highest and best use" as "income property." Politicos are fond of imagining that vacant land has no value when it produces no revenue, so they should be able to get or give such property for free. Show me a vacant downtown or oceanfront lot that you can get for free. For valuation of the 400 acre fairgrounds, they should consider recent sales of comparable property. In the absence of comparable sales, the purest measure of value is what the property would sell for at a public auction. If the State wants to sell the fairgrounds, they should advertise it for auction, subject to whatever environmental and developmental restrictions would be in the best interests of the taxpayers. Common sense indicates that the fairgrounds would sell for a couple billion or more. Otherwise, the $120 million deal will appear to be just another typical Kehoe backroom sweetheart deal.

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