The High Desert Report » November 2012

Monthly Archives: November 2012


Publisher’s Message-Fall 2012

Published by:

Joseph W. Brady, CCIM, SIOR

I wish to welcome our current, future and long standing subscribers of the 51st edition of the Bradco High Desert Report, the first and only economic overview of the High Desert region, covering the Northern portion of San Bernardino County and the Inland Empire. We more specifically address economic issues affecting the Cities of Adelanto, Barstow, Hesperia, Victorville, and the Town of Apple Valley.

As always, we are most appreciative to our over 135 committed article suppliers and our longtime newsletter sponsors for their continued commitment to our endeavor, and our attempt to find positive, factual and interesting economic information as it relates to the High Desert economy.

One item that the Bradco High Desert Report has always prided itself with is giving facts for people to make better decisions. Charts in the article prepared by the renowned Dr. Gobar showing the significant decrease that a residential building permits have seen in the High Desert region, are purely factual. The day will come where the High Desert will recover, but the charts are clearly intended to help decision makers make decisions over the next year, 3, 5, or 10 year period of time.

Dr. Gobar, Chairman of Alfred Gobar Associates (Brea) continues to do such an outstanding job of depicting the issues affecting the High Desert region and helping us have a better understanding of where we are moving.

We welcome Mr. Carlos Rodriguez, Chief Executive Officer of Building Industry Association (BIA/Baldy View Chapter), with his article, as well as Senator Jean Fuller regarding the very controversial Fire Prevention “Fee” that is of major discussion in the High Desert region and in other places throughout the state. I wish to thank Brittany A. Ortega of the State of California Employment Development Department for its ongoing assistance relative to employment date etc.

Ronald J. Barbieri, Ph.D., CPA, Senior Vice President of The Bradco Companies has included (5) five articles in this edition which discuss population, industrial growth, the expansion of the Panama Canal, local housing price increases and the snapshot of the High Desert and Southern California commercial and industrial real estate markets. What is interesting about the population base that we all use to describe the area we consider the High Desert region, and the article about population that Dr. Barbieri has included clearly indicate the High Deserts current population as of January 1st, 2012 as 446,950 with an increase of 3,434± residents in the last 2 years. You will find his article very interesting. I asked Dr. Barbieri months ago what he thought expansion of the Panama Canal would have on industrial space in Southern California. Please read his articles about his prognosis for the future.

I asked our long time friend Mr. Bob Thompson of Advanced Listing Services to team with Dr. Barbieri to discuss what effect the shortage of homes is currently having on price increases within the High Desert region. The Bradco Companies typically stays away from issues within the Bradco High Desert Report, we are pleased that we have leased or sold nearly 1 million square feet of industrial and commercial space in the last 18 months. We thank those cooperating real estate brokers from within the area and out of the area for their expertise and their professionalism in these transactions.

I would like to re-welcome back Assemblyman Mr. Tim Donnelly and his article “Reviving California if Going to Take a Revolution”. Thank you to Ms. Violette Roberts of the Mojave Desert Air Quality Management District for its continued support in the articles that they supply.

Our current First District Supervisor, Mr. Brad Mitzelfelt has submitted his last article as Vice Chairman and First District Supervisor titled “The County of San Bernardino is Moving Forward with Major Construction Projects”. I would like to publically thank Brad and his wife Megan for all their public service for many many years. We wish you the best Brad in your future endeavors and we had such a great opportunity to work with you. We will continue to move forward on the economic development council project that we had talked about in the last year.

I would like to thank Ms. Vici Nagel whose former group has recently renamed itself to the Academy for Grassroots Organizations, for her article. We hope to be making an announcement in January of 2013 that will augment the efforts with the great group, and the nearly 1,000, 501C3 and 501C4 now profit organizations that need monies within the High Desert region.

I would like to thank Mr. Bill Gruelich, Public Information Officer for Victor Valley Community College District (where I am proud to be an appointed Trustee) on the article that he has submitted about all the positive issues affecting our great institution. The Mojave Water Agency has submitted their article “MWA is Ahead of the Curve in Reliable Fiscal and Program Policies” and prepared by our friend Ms. Tamara Alaniz.

We continually appreciate the great relationship that we have had with SANBAG (San Bernardino Associated Governments) for many years and re-welcome Mr. Ray Wolfe as its Executive Director. We had worked with Ray when he was the Executive Director of Cal Trans (District 8), which included the entire Inland Empire. He takes over for our longtime friend Ms. Deborah Barmack. Ray again welcome to SANBAG. Thank you for the information that you and your staff supply our readers on an ongoing basis.

We are working very closely with Mr. Paul Granillo of the Inland Empire Economic Partnership and hope to be able to make a positive announcement in the first quarter of 2013 about a pending economic development group that would be formed in the High Desert region, and have some type of a working relationship with Mr. Granillo, IEEP and all their other partners.

Lastly, I would like to thank the City of Adelanto, Town of Apple Valley, the City of Barstow, the City of Hesperia and the City of Victorville for their updates and their articles from their economic development professionals. The High Desert has the best economic development organizations within any region that we have done business and we continually encourage their efforts to work together, as we are all in this issue together. We hope that you are enjoying the gorgeous fall we have had. We hope that you enjoy the 2012 Holiday season, we look for to preparing the 52 edition of the Bradco High Desert Report in February of 2013.

Lastly, and most importantly, if you wish to continue to receive a copy of the Bradco High Desert Report, any statistical reports, op-ed articles that we post to our website for free, please register at our website at Thank you.

Economy Property

Real Estate Market Outlook-Fall 2012

Published by:

By Alfred Gobar
Chairman, Alfred Gobar Associates

Over the past 50 years, increase in nonagricultural wage and salary employment as reported by public agencies has correlated closely with household formation and, therefore, housing occupancy. Employment growth is a good thing for real estate markets. An index of nonagricultural wage and salary employment for Southern California as a whole (Ventura, Los Angeles, Orange, Riverside, San Bernardino, and San Diego Counties) is illustrated in Exhibit A in comparison with a similar index based on the 1990 recession. As indicated, employment declined more in percentage terms in the current recession than it did two decades ago, and the recovery has been relatively feeble. Those of us interested in the High Desert real estate market, therefore, should have patience in order to identify attractive real estate market opportunities. From August 2007 until August 2009 (about the bottom of the decline in nonagricultural wage and salary employment), total job base in the six-County Southern California area decreased by about 800,000 jobs. Recovery since August 2009 through August 2012 has amounted to almost 200,000 jobs. Currently, therefore, the total employment base is about 600,000 jobs below the peak prior to the onset of the current recession. Theoretically this amounts to an improvement in demand from the low point of the cycle on the order of 135,000 dwelling units. Concurrently, however, despite modest new construction, approximately 140,000 new units have been added or are in the pipeline to be added to the total housing stock in Southern California; i.e., new development is at about the rate of demand growth.

Real Estate Outlook-Exhibit A

There may be a light at the end of the tunnel. It is likely, however, that we are looking into a fairly long tunnel.

During the twelve months ended August 2012, nonagricultural wage and salary employment as reported by the California Employment Development Department for the six-county area grew by approximately 158,000 jobs. This is a significant increase. Employment trends for California recently have been outperforming the general trends for the U.S. overall.

Employment growth over the twelve months ended August 2012 shows increases in most sectors including construction. Of significant interest is the increase in employment in the finance sector amounting to 9.2 percent of the overall job growth. Within that category, employment in real estate-related activities—rental and leasing, etc.—amounted to 4.9 percent of the 158,000 jobs increase. The finance sector represents less than 6.0 percent of Southern California’s employment base. The real estate portion of the finance sector amounts to about 2.0 percent of the total base. These categories of employment, therefore, are growing substantially faster than the general economy and faster than their overall role in the economy.

Employment in leisure and hospitality accounted for a substantial portion of job growth during the twelve months ended August 2012, amounting to 23.3 percent of the increase. This sector accounts for less than 12.0 percent of the total employment base in the six-county area.

Government employment grew little during the most recent twelve months for which data are available, accounting for 2.2 percent of the net increase. Overall, government employment is about 15.0 percent of the total employment base in Southern California. If government employment were to be increasing consistent with the other categories, total increase in nonagricultural wage and salary employment over the twelve-month interval would have been above the long-term average for Southern California as a whole and job growth would have exceeded the long-term average trend.

When Harry Truman was President, he was said to have pushed for “one-handed economists” so that economists could avoid tempering their projections by saying “on the other hand.” Similarly, we should point out that for the past several years, employment estimates from government agencies have been subject to revision and to rather erratic behavior on a month-to-month basis contributing to some queasiness regarding the validity of the data. Since the recent employment figures have been so positive, however, until they are revised, we will continue to act like we fully trust their validity. In the most recent twelve-month data, the most significant growth in nonagricultural wage and salary employment occurred in Los Angeles County, followed by San Diego County, Orange County, and the Inland Empire, in that order. The level of nonagricultural wage and salary employment in Ventura County declined slightly during the twelve-month interval.

The pattern of housing development in Southern California derivative of building permit activity for 2011 is fairly consistent with the relative growth in nonagricultural wage and salary employment among the five study areas (Riverside and San Bernardino Counties are grouped together as the “Inland Empire”). A comparison of the percent of nonagricultural wage and salary employment growth accounted for by each of the five areas relative to the percent of new units authorized by permit in each of the five areas is shown below:

Real Estate Outlook-County Comparison Chart

The specific data indicate that San Bernardino County represented 5.9 percent of the new units authorized during 2011 and Riverside County for 13.3 percent. Riverside County’s housing market benefits from its proximity to San Diego County, which experienced the recession sooner than the rest of Southern California and has been doing somewhat better than much of the rest of Southern California. In addition, Riverside County serves a national market for second homes and retirees.

The trend of building permit activity for residential development in Southern California since 1985 is illustrated in Exhibit B.

Real Estate Outlook-Exhibit B

There has been a modest increase in residential building permit activity since 2009. Actual numbers of new units authorized by permit since 1985 for Southern California overall are summarized in Exhibit C. Projections for full-year 2012 suggest building permit activity for Southern California will total about 29,000 units. Interestingly, this is roughly 14.0 percent of the level of building permit activity observed in 1986 when Southern California was emerging from the 1980 recession. It is also interesting to note that during 1985—at the end of the 1980’s recession—building permit activity in Southern California totaled nearly 150,000 new units, while currently in 2012, approximately three years after the bottom of the current recession, building permit activity is only 20.0 percent of that level at about 30,000 units a year.

Real Estate Outlook-Exhibit C

Although the 1980’s recession had the special features of extraordinarily high inflation and interest rates, the recovery from the current recession has been minimal, suggesting that economic growth that occurred during the 1980s supported a strengthening housing and real estate market, while the tepid economic growth observed currently has obviously not resulted in similar real estate sector activity.

Exhibit D shows the pattern of residential building permit activity on the High Desert. At the peak of activity, more than 8,000 units a year were being authorized by permit. Recently, as shown in Exhibit E, overall residential building permit activity has been on the order of less than 250 units per year in 2011 and likely to be substantially less than 1,000 new units for 2012.

The figures in Exhibit E are influenced substantially by 205 multi-family units authorized by permit in Victorville. Absent this atypical level of activity in multi-family housing construction, overall building permit activity on the High Desert would probably be on the order of 350 units for the full year, or less than 4.0 percent of the more than 8,000 new units authorized in 2005.

Real Estate Outlook-Exhibit E

Based on the average building permit value per unit, much of the new construction of single-family housing on the High Desert recently has apparently been custom homes. This is not a product that lends itself to high-volume activity. Much of the real estate activity observed recently has been of a qualitative nature—purchase of distressed assets that lend themselves to be reworked for enhanced value. The whole process of flipping foreclosures has attracted increasing levels of interest on the part of real estate professionals who have limited opportunities in tract developments, land entitlement, or other large-scale endeavors which typify opportunities in a strong market. Although interest rates are at record lows—a factor which should encourage real estate development or real estate investment—uncertainty associated with the tax environment, the risk of a double-dip recession, and general unease about an uncertain fiscal policy in light of the potentially inflationary impact of the current monetary policy contribute to anaura of uncertainty that makes real estate decisions particularly difficult, even for those intrepid individuals who somehow chose to make their living in this field.

One thing that makes this recession different from previous ones is that heretofore we generally relied on the housing market to lead the country into an economic recovery. Because of efforts through the Community Reinvestment Act and encouragement of Fanny Mae and Freddie Mac, we induced marginal buyers into real estate ownership prior to the recession. The reservoir of pent-up demand represented by potential first-time homebuyers was severely eroded and is not readily available to stimulate an economic recovery associated with lower interest rates and more moderate-priced housing. Significant portions of the housing market(which is the largest proportion of the real estate market) have been overexploited because of the interference of government policy, making this recession atypical relative to past experience. Basically, we have already shot that arrow and no longer have it in our quiver. This implies that the recovery is likely to continue to be slow, and that the real estate market will not begin to be vibrant for quite some time. Opportunities, therefore, will continue to be in rearranging real estate assets better to conform to the demand profile or exploiting market imperfections associated with limited understanding of the characteristics of demand and supply for real estate product. Raw demand is not likely to drive a strong real estate market for a number of years.

Economy Property

Some Encouraging Signs on the Home Front

Published by:

By Carlos Rodriguez
Chief Executive Officer
Building Industry Association (BIA) Baldy View Chapter

After years of cautious optimism, home building professionals are beginning to see signs of improvement in Southern California’s housing markets. While there is still a long road to a full recovery, the good news is Southern California home sales rose to their highest level in six years while prices hit a four-year high in August.

Data Quick reports that the number of homes sold increased more than 14 percent in August to more than 22,000 compared to the same period last year. The median price for new and existing houses and condos in the six-county region rose nearly 11 percent to $309,000 last month compared to August 2011. Last month’s median price was the highest since the median was $330,000 in August 2008. Experts say the housing market is fueled by low mortgage rates, more mid- to high-end deals, and near-record levels of investor and cash buying. Likewise, prices have been lifted partly by fewer sales of foreclosed homes.

Locally, communities located within the Victor Valley market have also experienced an estimated 4% increase in the median home pricing between July 2011 and July 2012 from approximately $112,400 to $117,100. If these figures continue to improve in the fourth quarter of this year and throughout 2013, then that’s great news for the outlook for a potential economic recovery.

The simple fact remains that an improved housing market will lead us out of economic recession. According to the report The Economic Benefits of Housing in California prepared by the Strategic Economic Research Center, in 2010 new home construction contributed over $13.8 billion per year and supported nearly 77,000 jobs in California in 2010. Over one-half of the economic output (about $7.8 billion) was directly the result of new housing construction and another $6.1 billion was generated by those sectors which supply goods and services to the residential construction industry “as well as the spending activities of the employees of the construction industry and its supplier sectors.”

The report went on to say that every dollar spent on new housing construction in California generated 80 cents in total economic activity while each job created through residential construction supported an additional 1.2 jobs in related businesses.

Because new homes have an assured longer life, appraisals are generally higher than on comparable resale homes and new homes are more likely to sell for a comparatively higher value in the future. This results in enhanced property tax revenue streams for our cities and county. That’s also good news for local and county government in desperate need of funding for quality of life services.

New home construction also funds new infrastructure such as streets, schools, parks, libraries along with fees for public safety such as police and fire services. These investments benefit everyone by keeping us safe and increasing the property values of existing homes and businesses surrounding new home communities.

There’s still a long road ahead to a full economic recovery. However, the recent signs of improvement in the housing market provide us with encouraging news about the prospects of increased local job creation and enhancements to local infrastructure improvements. While the market is still on the mend, the Building Industry Association Baldy View Chapter will remain steadfast in our efforts to work with elected leaders at every level of government to find public policy solutions to help us back on the pathway to prosperity.

The Building Industry Association of Southern California, is a non-profit regional trade association that represents more than 1,000 member companies within a six county region. Together, BIA members build most of the homes and communities throughout the same six-county region. For more information about the Baldy View Chapter go to

General Politics

Fire Prevention “Fee”

Published by:

By Senator Jean Fuller
California Senate District 18

My office has been overwhelmed with calls and questions about notices in the mail that they must pay a fire prevention “fee.” In July 2011, Governor Brown signed into law AB X1 29. The bill established a fire prevention “fee” for homes within the State Responsibility Area (SRA), an area that encompasses 31 million acres and approximately 825,000 homes.

In the eyes of many, myself included, this “fee” is really a tax. Because they could not persuade the required two-thirds of the Legislature to vote for a tax increase, the majority party instead re-labeled it a “fee,” thereby requiring only a simple majority vote for passage. The majority party in Sacramento used verbal gymnastics to twist and turn a tax increase into law.

This “fee” was passed to help backfill a budget problem that came about as a result of overspending. There is nothing about this tax that will provide better fire protection or prevention for property owners. It was done simply to balance our state budget, and that is wrong, and in this case, illegal.

If you received a notice from the State Board of Equalization (BOE) and believe you have been billed in error or the “fee” amount calculated is incorrect, it’s important you petition the California Department of Forestry and Fire Protection(CAL FIRE) for a redetermination of the amount determined to be due, using a Fire Prevention Fee Petition for Redetermination form. You can find the petition form by visiting www.firepreventionfee.orgor contacting the Fire Prevention Fee Service Center at 1-888-310-6447. A list of frequently asked questions and answers can also be found on the website.

Please keep in mind that you have 30 days to pay and appeal this fee, so it is important that you take action as soon as possible.

In the meantime, there are taxpayer advocacy groups like the Howard Jarvis Taxpayers Association that are closely following this issue and are preparing to file a lawsuit to stop this tax. I will be keeping a close eye on their activity while updating you, the constituents, on their progress. To ensure that you receive a refund, should this lawsuit prove successful, I strongly encourage you to file the redetermination form.

Economy General

Employment Development Department

Published by:

By Brittany A. Ortega
Employment Program Representative

2012 unemployment rates are shown in the chart below. The rates shown are National, State of California, San Bernardino County, and the High Desert Region.

It appears that 2012, so far has been a year of steady unemployment for most of the nation as well as California. The High Desert cities had a higher unemployment rate for the months of the year shown than either the nation or the state.

The past four months of 2012 did show a slight downward slope in unemployment rates, which we hope will continue throughout the remainder of 2012. The data shows that it is trending in a more favorable direction for the economic growth of California, San Bernardino County, and the High Desert Communities.

Employment Development Department-Table

Contributed by the staff of the EDD Workforce Services office in Victorville. Please contact (760) 241-1682 for further information.

Economy General

The Population of the High Desert Has Increased Since the 2010 Census and is Projected to Continue Increasing through 2016

Published by:

By Ronald J. Barbieri, Ph.D., CPA
The Bradco Companies

In order for home and land values to substantially appreciate in the High Desert over the next five years the area’s population must continue to grow at a moderate rate. The greater the growth rate the greater will be the rate of appreciation. The population of the High Desert peaked in 2008. As of January 1, 2009 Nielsen/Claritas(Nielsen) estimated that the population of the greater Victor Valley-Barstow area was 443,516. During the next 27 months the number of individuals living in the High Desert declined by 13,250. By the time of the April 1, 2010 U.S. Census the population was only 430,250. Since then there are indications the population of the greater five city area has increased. Nielsen estimated that as of January 1, 2012, the population of the High Desert was 446,950, which would represent an expansion of 16,684 during the 21months after the U. S. Census.

During the four year period from the beginning of 2009 through the end of 2011, Nielsen estimated the High Desert completely recovered the population it had lost during the last recession and actually added an additional 3,434 individuals. Nielsen also projected the population of the High Desert would continue to expand by 40,607 over the five year period ending January 1, 2017. This reflects an average annual population growth of 8,121. During the three year period 2004 through 2006 the population of the High Desert increased by approximately 25,000 per year. Although the expected population growth is only a third of what was experienced during the last housing bubble, it is significantly positive; and it has been sufficient to stabilize the residential housing markets in the High Desert, and to enable Taxable Retail Sales to increase in all of the last eight economic quarters.

The accompanying table depicts the same population information for each of the eight counties in Southern California, the state of California and the 21 ZIP code areas in the High Desert. At the time of the census, the Inland Empire had a population of 4,224,851, which reflected an increase of 7,999 from January 1, 2009. San Bernardino County suffered a loss of 32,260 while Riverside County gained 40,259. During that same period, Los Angeles County experienced a decline of (336,252) and Orange County lost (58,343), while San Diego expanded by 30,694. Ventura, Imperial, and Santa Barbara Counties all experienced increases in population. During the 27 months prior to the U.S. Census Southern California lost 340,571, while the population of the State of California only declined by 305,772. Hence, the rest of the state actually grew by approximately 35,000. At the time of the census, the state had a population of 37,253,956 of which 21,570,742 were in Southern California.

During the 21 months after the census, the population of the Inland Empire increased by 130,228, while the three coastal counties of Los Angeles, Orange, and San Diego only increased by 105,793. The population of Southern California increased by 252,261, while California grew by 464,337.

The five-year forecast by Nielsen estimates the Inland Empire will be the fastest growing region in Southern California. During the period ending 1/1/2017 the Inland Empire is projected to increase by 357,903, of which San Bernardino County would capture 112,771 of the increase and Riverside County 245,132. This reflects annual county growth rate of 22,554 and 49,026 respectively. During that same 5-year period, Los Angeles County is forecasted to increase by 24,635 per year, Orange County by 15,528, and San Diego County by 20,533. Nielsen estimates Southern California will experience an average annual increase of 141,455 compared to an average annual increase of 260,000 for the entire state.

The U. S. Census Bureau estimated that the population of the State of California increased by 93,000 for the three months immediately after the 2010 Census, and by 354,000 for the year ending July1, 2011. Nielsen’s annual average growth rate of 260,000 for the five year period appears to be a conservative forecast, in that it is 94,000 less than the most recent estimates by the U.S. Census Bureau.

The five cities in the High Desert experienced different population trends during the last recession and the subsequent slow economic recovery. The City of Adelanto and its surrounding ZIP code had significant population growth both before and after the U.S. Census. For the four year period ending January 1, 2012 it grew by 2,597 to 34,224. Households are attracted to Adelanto because it has the lowest median home prices of any of the cities within commuting distance to the Los Angeles Basin. Nielsen forecasts an average annual population growth of 755 for the 5-year period ending with 2016.

The two ZIP codes associated with the Town of Apple Valley lost 4,622 inhabitants during the 27 months prior to the U.S. Census; but in the 21 months following it the area experienced a rebound of 2,085 in the population. As of 1/1/2012, Nielsen estimated the Town of Apple Valley had a population of 79,552, which represent a net decline of 2,537 over the four year period. The Town is projected to experience an average annual population growth of 1,148 over the five year period beginning with 2012.

The Barstow ZIP code area lost 1,611 inhabitants from the beginning of 2009 to the end of 2011. Almost the entire decline in population occurred prior to the census. The population as of the start of 2012 was 31,846. Nielsen estimates the population of Barstow will only increase by 34 inhabitants per year for the 5-year forecasting horizon.

The City of Hesperia and the Oak Hills area lost 3,224 from the beginning of 2009 to the Census; but saw a population increase of 3,980 after the census. As of 1/1/2012 the area had a population of 103,454, or 746 higher than the pre-recession level. The Hesperia-Oak Hills area is projected to have an annual average growth of 2,184 for the five year period.

The three ZIP codes that include the City of Victorville had a decline in population of 4,267 before the census; but experienced an increase of 6,309 after it, which resulted in a net population gain of 2,042 for the four years ending January 1, 2012. As of that date the population was 136, 794. Nielsen forecasts an average yearly population increase of 3,497 for the Greater Victorville Area through 2016.

All the cities in the High Desert, except the Greater Barstow Area, have experienced significant population growth since the U. S. Census; and Nielsen is forecasting solid growth for the five years beginning with 2012. A substantial greater portion of the households in the cities of Adelanto, Hesperia and Victorville have at least one member who commutes to the Los Angeles Basin for employment than was the case for the Town of Apple Valley. A greater percentage of the Town’s employees worked in the High Desert and in residential construction, real estate and finance, which have experienced substantial declines since the start of the last recession. Consequently, it is not surprising that the Town of Apple Valley experienced a greater decrease in population prior to the Census than the other three cities in the Victor Valley Area. Since then the Town has experienced an increase in population similar to the other three cities.

Economy Politics

Reviving California is Going to Take a Revolution

Published by:

By Assemblyman Tim Donnelly
California 59th District

“You can send everyone else home; this is my job.”

That is what a woman told an employer when interviewing for a job that received hundreds of applicants right here in San Bernardino County. When asked why she was so confident, the woman told her interviewer that she wanted it more than anyone else – that unless she found work that day, she and her young son would be living out of their car.

She isn’t alone.

When I was walking door-to-door meeting constituents, one man stepped away from our conversation mid-sentence to take a phone call, then rushed out the door and took off in his car. His wife nearly broke out into tears explaining that he got a call offering a half-day’s work. They had been living on a wing and a prayer, hoping against hope to keep their home, and every little job was a godsend. I wish every elected official in this state could have stood with me on that porch. These are the people we represent. We were not sent there for the lobbyists and special interests who try to buy power.

People all over this state are doing everything they can to get back to work. I wish I could say the same for the legislature. Instead, the people who are supposed to represent us are doing everything they can to stay in the good graces of the green police and union bosses to keep their pet projects running. They have done so at the expense of our business climate, job market and overall economic health.

In the last week of session, the Assembly tried to pass 550 new bills in just 5 days. Most Californians don’t think we need any new laws at all. Governor Brown just finished going through the mess of hundreds of bills the Legislature sent him this year. Among them was a brand new tax on timber, which, of course, he signed. This means that the Sacramento majority and the Governor, both looking at double-digit unemployment and a state that is hemorrhaging businesses, decided that taxing the literal building block of the recovery was the answer.

I disagree.

I regularly have the pleasure of meeting business owners from across the state. Recently, a gentleman explained to me that because of California’s heavy regulatory hand, he is unable to expand his business and hire more employees, although he would otherwise do so. In the midst of the greatest recession since the Great Depression, it is a devastating and offensive reality. It’s offensive because it is 100% preventable. The vast majority of business owners in almost every industry tell me that their number one problem is not the economy; it’s government interference.

While other states are rolling out the red carpet for businesses to open or expand, California taxes materials, penalizes energy users (aka manufacturers) and punishes production. These backwards policies have chased business owners out of our state, with manufacturers leading the charge. It’s as if the so-called leaders of our state don’t want anything to be built in California! When they drive stable, high-wage jobs out of our region, they create a hole in the budget, which always disproportionally affects education, the largest state expense.

Instead of trying to attract new businesses or incentivize employers to hire people, California is literally extorting billions of dollars from companies under the guise of “Cap & Trade.” And what are they going to do with all this new-found money? Are they going to pay down the deficit or restore K-12 funds? No. Instead, the Governor just signed AB1532, removing all constraint on how those funds can be used. No constraint. That describes the legislature’s actions through the last session. AB1532 is a recipe to fund every hare-brained scheme and pet project they can dream up, all under the guise of reducing greenhouse gasses.

The inescapable reality in California is that no matter what business you are in, government, not greenhouse gas, is the greatest threat to your livelihood. The good news is that we can change our government. The founders created a peaceful process of revolution that takes place every 2 to 4 years. Beginning in November 2012, I believe the people will confound the experts and reject these wrong-headed policies that threaten to strangle our state.

Economy Property

The Expansion of the Panama Canal Will Not Have a Negative Effect on the Demand for Industrial Space in Southern California

Published by:

By Ronald J. Barbieri, Ph.D., CPA
The Bradco Companies

The completion of a third set of locks in the Panama Canal by 2015 will enable container vessels capable of carrying up to 12,000TEU’s of containers to pass through the canal and deliver goods from China and other countries in the Far East directly to eastern half of the United States via East and Gulf coast ports. The conventional wisdom is that this will substantially reduce the flow of in-bound containers through the Ports of Los Angeles and Long Beach. An article titled: “Panama Canal: Myths and Misconceptions” that appeared in the May 2012 issue of the American Shipper argues that the opening of the third set of locks in the Panama Canal will only have a minimal impact on the volume of imports entering through the twin Southern California ports.

This conclusion is based on the following observations discussed in depth in the article: First, there are few, non-bulk products that are not shipped by containers; so there is little growth from the conversion of loose cargo to containers. Second,the amount of outsourcing by U.S. manufacturers has already been maximized to the greatest extent possible. The relocation of manufacturing from Canada and Mexico to China was mostly completed during the last decade; and there are an increasing number of companies that have begun to relocated production back to Mexico and the United States, because of issues related to cost, quality control and time-to-market. The article claims analysts are now predicting slow growth and more trade volatility with competition among ports for container throughput becoming a zero sum game of winners and losers. A third point made in the article that shippers will not realize any significant cost savings due to the shipping of goods through the Panama Canal because the tolls chargedby the canal will offset much of the cost savings of using the larger container vessels. Also the West Coast carriers, ports and railroads have the advantage of being able to differentiate pricing by market segment and could lower prices for less premium service with slower transit times if they feel pressure from the all-water service going through the Panama Canal.

Fourth, the all water service via the canal,though less expensive,can be one to two weeks slowerthat transcontinental intermodal transport. High-value or perishable products that must quickly get to market will continue to rely on the faster transit times available through the West Coast corridor. Finally, the article also notes that by 2015 only the four ports of Norfolk, New York-New Jersey, Baltimore and Miami will have the 50-foot deep channels and berths capable of handling the largest vessels. While many of the ports are competing for federal and state funds to dredge channels and increase railroad capacity most will have a difficult time securing adequate funds because they will not have the shipping volumes to justify the required infrastructure investment. Whereas, the West Coast ports already have the infrastructure in place, and have the container volumes to justify adding additional infrastructure.

The articles concludes that the ports of Los Angeles and Long Beach could lose up to 10% of their volume to East Coast ports serving the Ohio River Valley or gain a few percentage points in market share depending on how shippers respond to the expansion of the Panama Canal. What is apparent from reading the article is that there are a number of offsetting factors that make it difficult to determine with precision the level of impact the expansion of thePanama Canal will have on the twin ports of Los Angeles and Long Beach. Nevertheless, the article, which is on The Bradco Companies website, makes a convincing case that the decline in the level of imports handled through the twin Southern California ports, is not likely to be much greater than 10%.

Even if the Ports of Los Angeles and Long Beach were to experience a 10% decline in volume because of the expansion of the Panama Canal it is not likely that such a decline in container volume would have any significant negative impact on the demand for industrial warehousing space in Southern California for following three reasons.

First, approximately 2/3 of the inbound containers that are handled by the Southern California ports are loaded on trains or trucks and are transported to the east. The containers placed on trains are hauled more than 1,200 miles because that is the distance at which the cost of shipping by train before transferring the containers to trucks become less than the cost of loading the containers directly on trucks and hauling them to their final destination. Even if the containers transported by trains experience some reduction in traffic it would not impact the demand for industrial space in Southern California.

Second, the expansion of the Panama Canal will not have any impact on the containers that are hauled east by truck because it would not make any economic sense to ship the containers to Texas and then backhaul them west to their destination points that are within 1,200 miles of Los Angeles. Containers transported from the ports to the east by truck do not create any demand for warehousing space in Southern California; nevertheless, they are one of the factors motivating the Los Angeles Metropolitan Transit Authority to get the E220 Freeway from the City of Palmdale, CA to the I-15 freeway in the City of Victorville, CA completed ASAP. The construction of the E220 is by far the least expensive solution to get trucks from the ports of Long Beach and Los Angeles to the I-15 Freeway heading east. The E220 is also expected to relieve congestion on I-10, I-210, I-15 and the 60 Freeways in the Los Angeles Basin and therefore mitigate several environmental and congestion problems.

One third of the inbound containers at the ports of Los Angeles and Long Beach are transported by truck from the ports to industrial firms in the Los Angeles Basin for local distribution, inventory storage, or for use in manufacturing. None of these will be impacted by the addition of a third set of locks in the Panama Canal.

The high levels of Net Absorption in the Inland Empire by large industrial users and tenants is further confirmation that Southern California role as a warehousing, distribution and manufacturing center will not be negatively impacted by the expansion of the Panama Canal.

Air Quality General

Mojave Desert Air Quality Management District Offering Over $1.3 Million in Mobile Emission Reduction Grants

Published by:

By Violette Roberts
Community Relations & Education Manager

The Mojave Desert Air Quality Management District is currently accepting proposals for projects that reduce smog forming-emissions from heavy-duty vehicles and equipment and other mobile sources operated within the District’s jurisdiction, which encompasses the High Desert portion of San Bernardino County and Riverside County’s Palo Verde Valley.

Approximately $575,000 in AB2766 grant program funds are available to public or private entities for projects that reduce emissions from mobile sources, which account for more than 60% of air pollutant emissions gauged in the High Desert. Eligible projects include transit and parking management projects, demonstration projects in telecommuting, videoconferencing, and alternative fuel vehicles, electric/alternative fuel vehicle infrastructure development, and public education programs. The incremental cost of purchasing or leasing clean fuel/electric vehicles or repowering existing vehicles to operate on alternative fuel may also be eligible for funding in an amount not to exceed 25% of the total project cost.

In 2011, $138,000 in AB2766 grant funds was awarded to the City of Victorville for the La Mesa/Nisqually Interchange Traffic Signal Synchronization Project. In 2002, the City of Barstow received a $450,000 grant toward the construction of a Liquefied Natural Gas/Compressed Natural Gas station within city limits.

The AB2766 competitive grant programis funded through vehicle registrations fees, which the local regulatory air agency uses to support programs that reduce air pollution from motor vehicles, as required by law. Public and private entities are encouraged to submit proposals either as sole or joint applicants. Proposals will be accepted through December 3, 2012 at 5:00PM.

Approximately $775,000 is also available through the state-funded Carl Moyer Program, which provides grants for projects that reduce emissions from heavy-duty vehicles and other mobile diesel equipment operated within the MDAQMD’s boundaries. Under the Moyer program, monies are disbursed to local entities via participating air districts to reimburse the partial cost of upgrading or replacing existing equipment with lower- emission technology. Small on-road fleets, small off-road compression ignited fleets, agricultural irrigation pumps and certain off-road large spark-ignited engines and locomotives are eligible for repower or retrofit through the program.

Applications for the Moyer program will be accepted continuously on a first-come, first-served basis until available funding is exhausted.

To download a Call for Projects packet for the AB2766 program or to find out more about Moyer grants, visit the MDAQMD website at For additional information, call (760) 245-1661, ext. 1885

Economy Property

A Shortage of Homes for Sale Has Caused a Significant Increase in the Price of Homes in the High Desert

Published by:

By Bob Thompson & Ronald J. Barbieri, Ph.D., CPA 
The Bradco Companies

During the 2004 -2005 housing bubble, 600 new homes were sold each month in the Victor Valley area in addition to 500 previously owned homes. The vacancy level was low and builders were straining to meet demand, which was artificiality inflated by the lax lending standards fostered by the federal government through Freddie Mac and Fanny Mae. The median price for previously owned single family homes in the Victor Valley area peaked in February 2006 at $322,000. By April 2009 the median price had declined approximately 68% to $103,000, which was the low point for this real estate cycle. In March 2012 the Median price for the area was only $110,000; however prices have increased consistently since May of this year. By September 2012 the median price reached $121,000. The table below titled the Victor Valley SFR Market Condition Report for September 2012 was prepared by Bob Thompson for Escrow Junction. It is the information source for this article.

A Shortage of Homes for Sale-Table 1


In the last six months the financial institutions including Freddie Mac and Fanny Mae have further reduced the number of home they release for sale. The number of homes listed has declined from a 2.2-month supply last March to only 1.4 months today. There were 641 homes available for sale in September 2012 compared to 451 closings. During 2004 and 2005 the number of outstanding listings averaged 2,500, which represented four to five months of sales. Real estate agents believe this is one of the factors causing the rise in home prices over the last few months.

Also, a review of the second page of the Market Condition Report would reveal that only 77 REO properties were listed for sale at the end of September, which is less than the 209 units available at the end of March. There were only 97 “short sale” units available in September compared to 230 in March of 2012. On the other hand in the latest report there were 469 “Standard Sale” homes listed by non-financial institutions which was essentially the same number available last March. In case of REO sales the ratio of closings to listing as only 0.50 months. There is truly a shortage of REO listings. The inventory for Short Sale properties that could be sold in 1.1 months at the current rate of sales, while the ratio of supply to demand was 2.2 months for Standard Sales.

A Shortage of Homes for Sale-Table 3


A Shortage of Homes for Sale-Table 4


A Shortage of Homes for Sale-Table 5

REO and Short Sales accounted for 53% of the transactions in September 2012. This is down from 67% in March of this year and 74% from 18 months earlier. This is a positive trend because it indicates properties that were foreclosed on represent a declining portion of the sales activity. Many of the buyers were investors, rather than owner occupants, who renovate the homes, and either, resell the units, or lease them to renters who are not able to purchase a home.

The demand for single family homes continues to be artificially inflated, because of the policies of the federal government. Interest rates are extremely low and down payments are usually substantially below 20% of the purchase price for owner occupants. Individuals are purchasing homes in the High Desert with as little as 3% down. On the other hand the underwriting criteria and documentation requirements are far more rigorous and extensive than normal; and the requirements for home appraisals tend to place a downward pressure on home prices. In the past appraisals could only include REO sales comps which are lower than standard sales comps. The effect of all this is to make home prices in the High Desert the most affordable in Southern California.

The requirement to use REO sales when doing an appraisal has been recently waived, which will make it easier for home price to increase. This will be the case, not only for the High Desert but for all of Southern California. The second page of the Market Condition Report depicts the Median Close Price for the 11 residential submarkets in the Victor Valley Area. In September of this year the Median Close Price for the REO sales in the area was $108,000. This compares to a Median Close Price of $116,000 for Short Sales and $130,000 for Standard Sales.

Home prices are expected to continue trending upward if the U.S. and California economies continue to expand, creating jobs that could support population growth and substantial household formations in both the High Desert and the Inland Empire. The good news is that the population of the High Desert increased since the U.S. Census and is currently slightly higher than it was at the beginning of 2009, before there was an out migration caused by the last recession. Recent population trends are discussed in another article on population in this Bradco High Desert Report.

Politics Property

The County of San Bernardino is Moving Forward with Major Construction Projects

Published by:

By Brad Mitzefelt
Vice Chairman & First District Supervisor
San Bernardino County Board of Supervisors

As I’m completing my service as San Bernardino County’s First District Supervisor in December, I’m pleased to take this opportunity to update readers of the High Desert Report on just a few of the county’s many ongoing and recently accomplished initiatives.

First and foremost, the ability of local government to provide public services is correlated to the success, or lack thereof, of local businesses. While I have recently successfully pushed for reforms to our development code and permit processing to encourage economic activity, my successor will have much to work on to build on this progress. In addition to whether an area is open for business, there are several other factors considered by a business making a decision about where to locate, including infrastructure and quality of life, especially related to public safety and public and private amenities.

Infrastructure is perhaps the most visible. For example, it’s impossible to miss the rapid construction of the La Mesa/Nisqualli interchange on Interstate 15, due to be complete next year. It was a true team effort by High Desert representatives to SANBAG, and I was proud to have been President of SANBAG when we agreed to partner with the City of Victorville in constructing this critical bypass to Bear Valley Road.

Strategic flood control improvements, including two that help advance development of a critical east-west corridor, from the Yucca Loma Bridge in Apple Valley to the Nisqualli Interchange in Victorville, to more traditional projects like a new storm drain at Mountain View Acres in the Victorville area are just a few examples of the county and cities working together to solve longstanding problems. Mountain and desert communities worked together to bring more than $28 million in additional road funding from state sources over the past few years, not including tens of millions of state bond dollars secured for Nisqualli and the new Ranchero interchange in Hesperia, and a hundred million dollars for the soon-to-be-reconstructed Devore Interchange at the I-15/I-215 junction that will eliminate the evening and weekend backup there.

A longer-term project that deserves special attention is the High Desert Corridor, which will link Palmdale and Victorville through a Public-Private Partnership that will speed up construction by 20 years. It will be the most powerful job-creating machine the High Desert has ever seen, ranging from blue-collar logistics jobs to highly skilled manufacturing to high-tech research and development. I was proud to be the founding chairman of the joint powers authority between the two counties that has since expanded the environmental analysis to include a rail component. This is our ticket to Metrolink commuter rail service to the High Desert, and potentially even a Palmdale to Victorville leg of the XpressWest private high-speed rail to Las Vegas project.

On October 1, the Board of Supervisors supported my motion to approve the Cadiz Valley water project, 15 years in the making, that will make available more than 200,000 acre-feet of water to water agencies within San Bernardino County over a 50-year period after it’s constructed in a few years. This will provide hundreds of millions of dollars of investment in our county and thousands of jobs, without harming the environment in the remote desert watershed near Amboy.

Public safety is always the top priority of local government, and nearly tripling the capacity of the Adelanto jail from 760 beds to 2,152 beds will allow the county to better deal with state prison realignment, which is putting thousandsof additional convicts and parolees under County jurisdiction. This improvement is currently under construction.

Outstanding public safety services require modern facilities. We’ve built new fire stations in Hesperia and Phelan, and the County’s new High Desert Government Center in Hesperia will soon be home to a state-of-the-art Public Safety Operations Center that will house dispatch for sheriff and fire and will serve as an emergency operations center. The County recently approved plans for a new fire station at Spring Valley Lake, which should be completed by fall 2013.

Public safety is one aspect of the important services provided by county government. Educational, cultural and recreational facilities also define the character of a region. The Victor Valley Museum in Apple Valley reopened last year as a fully accredited branch of our exceptional county museum system. It is truly an important cultural and historical touchstone for the High Desert.

It was quite an undertaking to acquire this previously private museum and bring it into the county system. However, I am now concerned with its future. So I am helping start the Friends of the Victor Valley Museum to raise private support to keep the museum open and thriving. I have pledged matching funds to a fundraising kickoff event on November 8 from 6 p.m. to 8 p.m. at the museum.

The County continues to support development of the Mojave River Walk trail which will join downtown Victorville with Mojave Narrows Regional Park and beyond. Victorville is the lead agency and my office was able to provide $75,000 as matching funds for a grant that allowed the environmental review by Victorville to continue uninterrupted. And early next year, Wrightwood will have a new skate park, providing young people with a safeplace to enjoy their favorite pastime.

The most popular and internationally recognized attraction in the nine-park county regional park system is undergoing major improvements. Calico Ghost Town just opened the new Calico Mining Museum in the previously unused Zenda Building, providing an entertaining and informative window into the past lives of the miners and the historic mining equipment and techniques that made Calico one of the most productive mining districts in the late 19th and early 20th centuries. The Lane House at Calico is also being refurbished with new exhibits, and the County recently awarded a contract to construct new restrooms and showers at the campground that serves as a popular staging spot for off-road trail adventures.

As we continue to look to the future, we want to ensure that growth and development down the road has necessary infrastructure and public amenities to ensure a great quality of life. The community of Helendale in the not-too-distant future will be an even more ideal location for the highly skilled workers and managers the region is beginning to attract. When a number of proposals emerged several years ago to build hundreds of new homes there, I called for and have since funded development of a Helendale specific plan, which is analyzing and planning for the community-wide need for roads, water, parks, and other infrastructure. The specific plan will guarantee that Helendale will live up to its potential.

To address the county’s past corruption and prevent future continued ethical issues, we have prosecuted and pursued wrongdoers for punishment and restitution. We are recovering millions of dollars lost to corruption and we have passed numerous reforms. We have made county government more transparent and put a cap on campaign contributions to county elected officials. Our citizens demand clean government and our good name depends on it.

I was proud to have helped usher in entirely new management that includes a world-class, respected and empowered County Executive Officer, who has helped us get our financial house in order over the past few years, identifying and eliminating myriad deficiencies and bringing order and professionalism to a government that was at times dysfunctional, sometimes unable or unwilling to do more than follow the whims of elected officials.

Like any family or business, the County is obligated to live within its means and serve as vigilant stewards of your tax dollars. The decline in property values and taxable sales have hammered County government on the revenue side, but generous pensions for our public employees that were negotiated and awarded during boom times threaten to overwhelm our ability to provide essential public services.

Employee associations are recognizing the gravity of the long-term situation and have been partners in reaching solutions. Top administrative staff started paying the 7 percent employee share of their pension deductions more than a year ago and fire department employees followed suit. More recently our deputy sheriffs and probation officers joined them in being part of the solution as well. The next challenge will come when the contract with the general employees comes up for negotiation in 2014. Labor costs are the bulk of local government expenditures so we will have an opportunity to make adjustments that will put the county on solid financial footing for years to come.

But government is a lagging indicator and the financial health, and as I said before, of local government depends on the success of the private sector. The High Desert needs to work as a region to attract employers. I have made key investments on your behalf in education of our workforce, from aviation mechanics training to nurse training to precision machinists training. But there is much more to do to replicate these efforts and leverage training programs and dollars across all major industries.

Our selling points are compelling – location, land, labor, and leadership. But we need to realize that whether a business comes to Adelanto or whether it comes to Apple Valley, we all benefit. To that end, I am supporting the creation of Team High Desert, a cooperative effort among the four Victor Valley cities to market the region to site locators.

I see High Desert governments working together better than they did when I began my public service with the county. This is helping us solve regional problems, which is always a huge challenge. I consider that one of the most important things I have had a hand in. It has been an honor to serve, and I thank you for the opportunity.

General Nonprofits

Academy for Grassroots Organizations

Published by:

By Vici Nagel
President & CEO
Academy for Grassroots Organizations

As I have stated in previous columns in this publications, the nonprofit sector presents our region with huge opportunities for economic growth … and it is time for serious investment to help this sector embrace its role as a component of San Bernardino County’s economic engine.

First, let’s take a look at some facts and figures.

  • There are currently 1,563,596 tax-exempt (nonprofit) organizations in the United States: 5,600 in San Bernardino County.
  • In 2010, nonprofits accounted for 9.2% of all wages and salaries paid in the United States.
  • Nonprofits’ share of Gross Domestic Product was 5.5% in 2010.
  • In 2010, public charities reported over $1.51 trillion in total revenues and $1.45 trillion in total expenses.
  • Public charities reported $2.71 trillion in total assets in 2010.

Why are these figures important?

These figures demonstrate that the nonprofit sector is not just a collection of “do gooders,” but rather is a significant industry contributing to our nation’s economy. And similar to any industry in these challenging economic times, we need to think about how we can increase its strength to create greater economic activity and jobs.

In previous columns I have talked about our local nonprofit sector not receiving its share of foundation funding, with San Bernardino County communities receiving only $3 per capita in foundation funding compared to a state average of $119 per capita.

What is even more startling is the disparity in the amount of government funding our county receives. In 2010, the last year data is available, San Bernardino County received just $1,018 per capita in federal grants compared to a national average of $2,213. That is a $1,196 per capita disparity, or in other words, our county received $2.4 billion less than the average allotment of federal grants … in just one year.

What would you invest to bring an additional $2.4 billion to our county every year?

A great deal, I hope!

Our organization, Academy for Grassroots Organizations (formerly High Desert Resource Network) is dedicated to improving our quality of life by supporting and strengthening this woefully under-resourced sector/industry. As we work to strengthen individual organizations and the sector as a whole, we hope to help organizations become effective, responsive, innovative and sustainable. We do this through a variety of collaboration building, resource development, and training services provided to nonprofits throughout San Bernardino County.

But moving the local nonprofit sector from its dire lack of capacity and resources to one that is a vibrant and dynamic contributor to our quality of life, as you can imagine, is a huge undertaking. No one entity can accomplish it alone. Fortunately, Academy for Grassroots Organizations (AGO) is part of a wider network of nonprofit management support organizations, government entities, and businesses all working together to change the paradigm.

During the next several months AGO will be working with this network to create a strategic plan for building the county’s nonprofit capacity. We will be looking at the sector’s strengths and gaps in services and will develop a list of strategies aimed at significant increases in both nonprofit funding and performance. I look forward to reporting to you about those strategies in the next Bradco High Desert Report. Then, I hope you will join us by investing in this critical work to grow our nonprofit sector and grow our economy.

Finally, I am excited to report that our organization is also poised for growth. During the past year and a half our Board of Directors has stepped up to the plate to take an even greater leadership role in the region’s social service sector. Doing the groundwork to lay a foundation for growth, the Board has expanded our service area to include all of San Bernardino County, developed a formal relationship with The Community Foundation Serving the Counties of Riverside and San Bernardino, partnered with organizations throughout the county to provide training in multiple locations, and changed our corporate name from High Desert Resource Network to Academy for Grassroots Organizations.

We believe that this new corporate name will help people better understand our mission and what our organization does. Academy relates to our strong focus on learning and Grassroots Organizations relates to our focus on helping organizations that are grounded in and concerned about local communities.

We also want readers to know that High Desert Resource Network will live on as a program of Academy for Grassroots Organizations. Through the Network we will continue hosting informative monthly meetings and bringing attention to this important sub-region of the county. Like our other signature program, The Fundraising Academy for Grassroots Organizations, the Network provides training and networking opportunities nonprofit professionals and volunteers need to advance their organizations.

For our schedule of meetings and trainings please visit

I hope to see you soon!

Vici Nagel is a 30+ year nonprofit professional and President/CEO of Academy for Grassroots Organizations, a nonprofit management support organization dedicated to improving the quality of life in our region by supporting and strengthening the social service sector. Further information may be found at .


Victor Valley Community College-Fall 2012

Published by:

By Bill Gruelich
Public Information Officer
President’s Office

Victor Valley College, established in 1961, has undergone many changes since its inception. Most significant is student population. From humble beginnings, the college has grown from serving 500 students to more than 17,000 per year. Throughout this period, the college has managed to meet the higher education needs of the people of the Victor Valley. This educational experience has allowed students to reach one or more personal goals that include transfer to four-year colleges and universities , receive an A.A. or A.S. degree, earn an occupational career certificate,or access career training that expands his/her ability to meet current industry standards.

VVC offers Associate in Science and Associate in Arts degrees in 23 different disciplines and more than 100 certificates. Three new degrees have been approved for VVC by the Community College Chancellor’s office to include an Associate in Science for Transfer in Administration of Justice, an Associate in Science for Transfer in Mathematics and an Associate in Arts for Transfer in Sociology.

Today, the college’s budget is approximately $47 million after suffering more than $12 million in cuts over the past four years. The college employs 770 in faculty, management and classified positions. Year-to-date, the VVC budget has been cut by a total of $4.9 million ($2.7 million budget cut was imposed at the beginning of the year and two subsequent cuts in the amounts of $925,000 and $1.2 million, respectively, were implemented in January and February 2012.) This year the college also absorbed another cut of approximately $1 million due to the Redevelopment Agency’s tax revenue shortfall, which brings the total budget cuts to VVC for the current fiscal year to $5.9 million.

Cuts caused the workload to be reduced from 9,404 FTES (Full-Time Equivalent Students or approximately one student taking a full-time load of 12 credit units) in FY 2010-11 to 8,829 FTES in the current fiscal year as the result of the mandated budget cuts. However, VVC staff has continued the plans that were recommended by the Budget Committee, Enrollment Management team and approved by the Board of Trustees to generate approximately 9,600 FTES. The level of workload production contributes to two positive results: 1) more course offerings to local students and 2) the District receives an additional one million dollars in state funding for meeting the mid-size college standard. VVC will continue receiving the additional one million dollars through fiscal year 2014-15 because we met the mid-size college threshold this year.

VVC has used the budget reserves to balance the current year budget despite the large aforementioned revenue cuts. An anticipated current ending balance of approximately $14 million will help with the balancing of next year’s budget.

VVC’s main campus encompasses 253 acres and the Regional Public Safety Center in Apple Valley that encompasses 13 acres. The college dedicated the new Regional Public Safety Training Center on April 21, 2012. The center is located on the corner of Navajo and Johnson roads near the Walmart Distribution Center. The $31.4 million center is the first construction project funded by Measure JJ that was approved by voters in 2008. The center features a multi-agency learning environment to maximize disaster training by incorporating first responders programs that include Fire Science, EMT, Paramedic and Administration of Justice and Corrections.

VVC also owns 55 acres at Main Street and US Highway 395 for a future Workforce Development Center. Victor Valley College (VVC) has always placed a high value on workforce development through the support of strong vocational or career/technical education (CTE) programs. These programs are critical to the community and to the local economy, as they provide entry level employees and incumbent workers with the skills necessary to both improve their own standard of living, and to contribute to the growth of local businesses and industries.

VVC currently holds a 70.2 percent success rate for completion of credit vocational courses (2010-2011 year/ARCC 2012 Report).

At this time, VVC is focusing on building future enrollment for the Workforce Development Center by offering classes at both Silverado High School and Hesperia High School as a means to meeting current academic needs in this region of the High Desert. This project will be funded with Measure JJ bonds once the market improves. VVC serves a population base of approximately 400,000, and has more than 20 diploma granting institutions in its service area.

Construction Project Plans

Every year, Victor Valley College is required to update its five-year facility plan for submission to the California Community College Chancellor’s Office and the Department of General Services. Once the plan is approved, it is presented to the College’ Board of Trustees for approval. Projects at the top of the list include the modernization of the music building, the construction of an additional Science/Health facility and the expansion and refurbishment of certain vocational buildings. The funding source for these top three prioritized projects is Bond Measure JJ, passed in November 2008 by the voters of the District.

Music Building Modernization

This project is currently underway and calls for modernization of 8,308 Assignable Square Footage (ASF) / 10,002 Gross Square Footage (GSF) comprising the existing Music Building built in 1968. This building has not been updated for 43 years. The project includes bringing the building into compliance with the ADA code, updating the sound system, improving room acoustics, updating electronics, and creating additional practice rooms.

For the fall 2010 semester the Music Building laboratories were utilized at 110% of capacity (Capacity/Load Ratio of 91.4%). Project Cost: $3,800,000 Net ASF: 9,708, Occupancy Year: 2014/15

Science/Health Building

This project constructs a new permanent 14,880 ASF / 21,200 GSF science and health/nursing laboratory building on the main campus at Victor Valley College. It will be in the form of a one story building located adjacent the existing one story Science Building. The original design for the Science Building was based upon enlarging the lab capacity as enrollments grew by adding an additional row of Life and Physical Science Laboratories on the west side of the building. The existing science prep spaces (lab service) are unchanged, as their location and present size were anticipated to meet this expansion.

Across a hallway from the new science labs are new laboratories and offices for the Health/ Nursing programs, including Skills labs and SIM (simulation) labs for training in various health specialties: OB/Gyn, Pediatrics, ICU, Medical/Surgical Patient Room, and Psychology. Each SIM Lab will have a control room and a group Debriefing Room using one way glass and video cameras for observation and critique.

The new building will be free-standing and will be situated to provide convenient access from the new science labs to the existing science prep spaces. Concurrently, the new nursing/ allied health labs will be close to the existing Nursing Building, which will continue to accommodate part of the nursing program. It will be remodeled as a future secondary effects project with some vacated labs converted to lecture space for these programs.

For the 2011 Fall Semester, the existing Science Building laboratories were used at 121.9 percent of capacity. The Allied Health/Nursing Building laboratories were used at 314.4 percent of capacity. In addition, the Health programs also used the Technology Center Lab room 143 and Lower Portable room 7 (at 176.7 percent of capacity). These use data demonstrate a clear need for additional science and health laboratory classrooms. Concurrently, classrooms on campus were used at 121.4%, representing an immediate shortage of 11,000 ASF, approximately 14 classrooms.

It will incorporate new labs in the health and science fields including:

  • Nursing
  • Allied Health
  • Health Simulation Labs
  • Biology
  • Chemistry
  • Earth Science

Project Cost: $14,400,000 Net ASF: 14,880, Occupancy Year: 2015/16

Expand/Refurbish Certain Vocational Buildings

This project reconstructs 2,862 ASF / 3,720 GSF of existing space and constructs 6,732 ASF / 9,357 GSF of new expansion or replacement space for the Auto/Diesel Mechanics and Welding lab programs on the lower campus. The project will also result in moving the Digital Animation Laboratory currently located in a portable building that occupies the location of the Diesel Mechanics Lab expansion. The Auto and Welding facilities are among the oldest at the VVC Campus and in dire need of updating/upgrading.

For the 2011 Fall Semester, the Welding laboratory was used at 150.6 percent of capacity, the Auto laboratories were used at 546.3 percent of capacity, and the Agriculture laboratory was used at 594.2 percent of capacity. Project Cost: $6,500,000 Net ASF: 6,732, Occupancy Year: 2014/15.