Adam Sanchez Seeks Return to DHS City Council

Adam Sanchez seeks return to Desert Hot Springs in District 3

DESERT HOT SPRINGS — Former Mayor Adam Sanchez is challenging incumbent City Council member Jan Pye in the Nov. 8 election. This will be the first time that voters here elect representatives by districts.

Mayor Pro Tem Gary Gardner, who represents District 1, is unopposed. Members of the City Council from Council Districts 2 and 4 shall be elected on a by-district basis beginning with the General Municipal Election in November 2024 and every four years thereafter. One mayor shall be elected at-large in November 2024.

The move to district-based elections was prompted by a letter the city received on Nov.1, 2021, asserting that the city’s at-large election system may violate the California Voting Rights Act (CVRA) and threatening litigation if the city did not voluntarily transition to a district-based election system for electing its City Council.

On Dec. 8, 2021, the City Council adopted Resolution No. 2021-071 declaring its intent to transition from at-large to by-district elections.

Sanchez was first elected to the City Council in 2011 and two years later, in 2013, was elected mayor. He ran for re-election as mayor in 2015 but lost to then-Councilmember Scott Matas. Matas currently serves as mayor. His term expires in 2024.

In 2018, Sanchez sought a Council seat but lost to Pye. He ran for mayor in 2020 but failed to unseat Matas.

Uken Report (UR) posed a series of identical questions to both Pye and Sanchez. Pye did not respond. Following are the questions and responses from Sanchez.

UR: Occupation

Adam Sanchez: I’m the director of Operations for the Desert Hot Springs Art Foundation. The purpose of the Arts Foundation is to weave the fabric of our currently distressed community into a new, healthier pattern, using the strong and vibrant fibers of the arts. I’m currently planning a November Fall Community Arts Harvest Pop-Up Event in Desert Hot Springs to raise funds to create an art mentoring program between at-risk youth and the Desert Hot Springs Police Department.

I would like to thank our police officers for their dedicated service in keeping law and order in our city.  Our police officers’ families need to be thanked for their support and for understanding the challenges and dangers our officers witness daily and night on the job. Let’s build stronger relationships between police officers, at-risk youth, and families to build a trusted Desert Hot Springs for all.

UR: Who or what motivated you to run for City Council at this time?

Adam Sanchez: I was motivated to run for City Council by over 100 Desert Hot Springs Boys & Girls Club families that wanted to know the truth on why the Boys & Girls Club was closed and bring to light the $300,000 in a $700,000 Club reserve funds account that was lost in the stock market by my opponent Jan Pye who served on the Clubs Finance Committee responsible for the investment policy and reserve fund account.

The $700,000 was in a Fidelity investment account which was converted to a Board Designated Reserve Fund by the Boys & Girls Clubs’ external auditor to prevent fraud and not allow Club Board members, especially Finance Committee Members, from removing monies to trade in risky stock market investments.

The following paragraphs are from the Club’s mandated annual Standards of Effectiveness report to the Boys & Girls Club of America which states that reserve monies are not to be touched by Jan Pye and only managed by outside professionals. The balance of the $700K will be invested by outside professionals with a board-adopted Investment Policy in place by June 2007, including capping stock performance to protect gains and transfer gains to Operating-Reserve.

July 26, 2005 – Board Designated Reserve Fund is at $660,000

April 2006 – Board changed the Board Designated Reserve Fund –Removed $30-$60K to a Payroll Act. & $200K to Operating Reserve Act. The balance of the $700K will be invested by outside professionals with a board-adopted Investment Policy in place by June 2007, including capping stock performance to protect gains and transfer gains to Operating-Reserve.

In January 2007, the Balance of the Boys & Girls Club’s $700,000 thousand reserve account was to be invested by outside professionals with a board-adopted Investment Policy in place by June 2007, including capping stock performance to protect gains and transfer gains to Operating Reserve. The new investment policy was in place to prevent Club Finance Committee Members under the direction of Jan Pye and Board Members from raiding it to gamble on the stock market.

In January 2009, I opposed the Desert Hot Springs Board of Directors’ merger of the Boys & Girls Club with the Coachella Valley Boys & Girls Club because it was a huge financial mistake. In 2009 the Boys & Girls Club of Desert Hot Springs had been in operation for nearly 30 years and was the envy of the Coachella Valley with a $700,000 reserve account, an operating budget of $800,000, with after-school programs at four elementary schools, one middle school, and one housing neighborhood youth center serving over 1,000 children and youth daily.

The merger idea did not make sense at all. At this time the Desert Hot Springs Health & Wellness Foundation was being formed under the guidance of the Palm Springs Health Care District to utilize New Market Tax Credits to help build the Health & Wellness Center. The New Market Tax Credit Program works by attracting private capital into low-income communities by permitting individual and corporate investors to receive a tax credit against their federal income tax in exchange for making equity investments in specialized financial intermediaries called Community Development Entities (CDEs).

The Desert Hot Springs Boys & Girls Club Board led by Pye was insistent that a merger would be best for the city. The Boys & Girls Club of Coachella was also jealous that the Boys & Girls Club of Desert Hot Springs had better programs and we were connected to Congressman Jerry Lewis and U.S. Sen. Barbara Boxer and their director Jim Duccate had his eyes on these relationships and on the $700,000 thousand reserve account that was being promised to him by my opponent Jan Pye.

Under Council Member Jan Pye’s guidance, she convinced the Board of Directors of the Boys & Girls Club of Desert Hot Springs to merge with the Boys & Girls Club of Coachella and promised them all the Club’s assets including the $700,000 in the reserve account. I left the Boys & Girls at this time under protest and the Board of Directors then began running the Club during the merger. During the one-year merger process over $400,000 in grant program monies were lost due to the Board of Directors running the Club’s operations with no professional experience. This included over $300,000 in the designated reserve account due to my opponent Jan Pye’s financial negligence.

The facts are clear, the Boys & Girls Club Board Members no longer had the wisdom, passion, and competency to lead the non-profit and made the inexcusable financial mistake to close the doors. What should have happened is for the Board members to resign and allow new Board Members to lead the non-profit forward with my continued good faith guidance and professional experience.

Once the merger was finalized, Council Member Pye allowed the Club’s $700,000 reserve account to be invested in risky stock market investments and over $300,000 was lost.

No other city council in California would be that incompetent to give away $2.5 million in taxpayers’ dollars over 10 years to a non-profit Boys & Girls Club. This could only happen in a small city run by unprofessional staff and City Council Members under the pretense that they had common sense. The following paragraphs are the lease agreement between the City of Desert Hot Springs and the Boys & Girls Club of Coachella Valley.

The Boys & Girls Club of Coachella operated the health & wellness center for four years between 2010 and 2013 for 1,000,000 million dollars. I became a City Councilmember in 2011 and discovered the City Council was spending too much and headed to serious financial troubles. Council Member Jan Pye was on the City Financial Budget Committee and was not transparent about the finances.

I ran for Mayor in January 2013 because City Finance Committee Members Jan Pye and Mayor Yvonne Parks would not make public that the City Council budget was operating in a serious multi-million-dollar budget deficit of over $6million dollars. By August 2013 City department staff directors began leaving their jobs.

As Mayor, I began the process to save the city by working with Council members Betts and Mckee to balance the budget and keep us out of possible bankruptcy. I continued to work to build the Health & Wellness Center Borrego Health & Medical center with the Desert Health Care District and assist with the creation of New Market Tax Credits under the newly created Health & Wellness Foundation.

Yvonne Parks, Jan Pye, and Scott Matas knew that Coachella’s Boys & Girls Club had no financial resources to help raise money for the new City Health & Wellness Center. Their jealousy over my efforts to build the Health & Wellness Center was too much for them to accept.

Residents will remember their legacy as poor politicians who made terrible decisions for their political gain. The sad part is that after they almost bankrupted the city and gave away $1 million taxpayers’ dollars to the Boys & Girls Club of Coachella, Coachella left the city.

It’s now time for Council Member Jan Pye to acknowledge the truth about her role in closing the Boys & Girls Club and how $300,000 or more were lost in the stock market and why it was covered up by the Board of Directors. As a City Council Member, Jan Pye was obligated to disclose the facts about this due to the monies being public funds.

In the end, Councilwoman Jan Pye’s best interests were not in our children but in her own political interests to have me removed as Director of the Boys & Girls Club to then take credit for moving the Health & Wellness Center forward and receiving credit for those efforts. The interest of the Boys & Girls Club of Coachella was all financial to benefit their bank accounts and no longer having to be second best to the Desert Hot Springs Boys & Girls Club.

The above facts can be verified by the past Boys & Girls Club Board Members, Club Annual Standards of Effectiveness Reports, City Council Agenda Meeting Minutes, and City & Boys & Girls Club Financial Audits.

Boys & Girls Club Board Roster

Cynthia Flores, retired CSUSB Dean-Board President, Dave Cantwell-realtor-Board Treasurer, Jan Pye-Council Member, Manny Aragon, John Aguilar-County EDA, Jessica Gilbert-realtor, and Bill Houston. The above Public Information can be found from the audit for the Boys & Girls Club using the IRS Business Master File and form 990 financials. GuideStar.org has the final financial audited reports of the Boys & Girls Club of Desert Hot Springs. The Boys & Girls Club of America also has the final financial merger reports.

UR: What makes you a better candidate than your opponent(s)?

Adam Sanchez: First, I have a history of guiding our city out of financial trouble. My opponent Jan Pye has led us into financially troubled times more than once. The past bad financial times came about in part with some very giant spending mistakes that created a 6,000,000-million-dollar budget deficit in 2013 that led the city to a financial emergency and on the edge of bankruptcy. Also, my opponent voted for and strongly supported giving a concert promoter $250,000 to produce a music festival that was designed to raise money for the health & wellness center, and never happened. She not only did that once, she did it once before to the tune of $90,000 for a concert the city paid for but never happened. Her errant financial judgment has repeatedly cost the taxpayers money for nothing.

Second, I have a track record of being a good leader who maintains and develops financial skills, grant writing knowledge, fundraising expertise, and experience in community development. I’m objective, fair, and reasonable. I take responsibility for my actions as well as the action of others. I act with conviction and understand civil law, government, and the rules and processes associated with serving on a City Council.

Third, in 2003 after returning from Washington D.C. visiting with Congressman Jerry Lewis, the City of Desert Hot Springs Community Health and Wellness Center was conceived to provide facilities for a medically underserved community to improve the health and welfare of the community. With a poverty rate of 33.8 percent, an unemployment rate of 13.2 percent, and a median family income of 45.5 percent, the need for this project was acute.

The design for the health & wellness center came from drawings I secured from the Crow Creek Boys & Girls Club Sioux Indian Reservation located in South Dakota. A 30,000 square foot state-of-the-art health & wellness center. Dozens of local, not-for-profit, and federal programs are interwoven to create a robust and comprehensive program designed to address the many needs of the Indian Reservation.

In 2013, I was elected Mayor and the City of Desert Hot Springs partnered with the Opportunity Fund, a New Markets Tax Credit (NMTC) allocatee, to provide over $20 million in financing necessary to construct the facility and create more than 120 construction and permanent jobs. Approximately 33 percent of the city’s population is under 18 years of age and the project targets this important segment of the population. The 6.63-acre, 36,000-square-foot health & wellness center project provides upstream preventive and primary healthcare opportunities through a newly constructed facility designed to activate the community in physical activity, as well as health and nutritional education.

The New Market Tax Credit Program works by attracting private capital into low-income communities by permitting individual and corporate investors to receive a tax credit against their federal income tax in exchange for making equity investments in specialized financial intermediaries called Community Development Entities (CDEs).

My campaign website states my knowledge and experience as a community development leader. Visit voteforadam.org for more details on my community contributions.

UR: What can you bring to the City Council that is currently missing?

Sanchez: A cautionary note on city finances and a look to make sure the city is not heading to the same financial troubles I faced when I first joined the City Council. I warned for two years that the city was spending too much and headed to serious financial troubles. Council Member Jan Pye was on the city financial budget committee as an accountant and was not transparent about the finances. It crashed. I see some of the same financial dynamics now as I did then, excessive spending, a slowing economy, and several new projects that will be a significant financial burden on city finances. I got the city through those difficult financial times and left it in a stable financial situation with a 12-million-dollar reserve budget account.

UR: What is the single most important endorsement you have and why?

Sanchez: Not seeking endorsements, why, because even though citizens are uninformed about basic policy decisions uninformed voters can use endorsements to choose the candidate they would have chosen if they had complete information about the candidates’ ideological position and public record facts. They then could use endorsements to guide their political decisions.

Endorsements do not serve as a true reflection of the candidate running for office. My opponent Jan Pye uses endorsements because she has no record of public service achievements to improve the community.

To prove my point, Supervisor Manuel Perez endorsed my opponent who has a track record of incompetent financial decisions, and the DHS Police Department also made an endorsement even though my opponent created a $6 million deficit in 2013 that reduced the police department staff and salaries, and the city came close to having the Riverside County Sheriff’s Department take over policing services. It was my vote as Mayor in 2013 that saved our current police department from closing its doors.

UR: What do you consider your greatest accomplishment either in or out of office?

Adam Sanchez: Saving Desert Hot Springs from bankruptcy in 2014. One day after being elected Mayor of Desert Hot Springs, city accounting staff announced we only had $400 in the bank. We went to work and reduced wages, condensed staff, and sharpened our pencils to negotiate new business contracts with vendors. We were able to achieve a balanced budget and then we asked the voters to consider cannabis ordinances to become the first city in California to welcome industrial-based cultivation and dispensaries to create new revenue sources for the city budget. This allowed the city budget to double and today we have a 12-million-dollar reserve fund, a new Police Department Dispatch Center, and a new 10-million-dollar City Hall.

UR: What is the single biggest issue facing Desert Hot Springs and why?

Adam Sanchez: Holding onto the Cannabis industry that I helped to create which is supplying 30% of the city budget. If the Cannabis industry in Desert Hot Springs should falter or God forbid should pull out of Desert Hot Springs, the city will be facing tough financial choices. Money set aside in reserves, which the Council has already cut back from what they were when I voted to establish them, will not sustain the city. We saw that in the last city financial crisis.

Homelessness is also a big and serious issue. We can’t allow our main streets and neighborhoods to be overwhelmed as we see in the news. You can already see that happening on our main boulevards and now starting to spill over into neighborhoods. People don’t want to live next door to houses and Spa Resorts that have been taken over by squatters and our main street sidewalks turned into camps.

UR: What will you propose to do about it?

Adam Sanchez: Councilmember Jan Pye is on the Coachella Valley Association of Governments (CVAG) representing Desert Hot Springs and gives CVAG $100,000 every year as her way to wash her hands and avoid dealing with the current homeless crises in the city. After five years that equals $500,000.

It would be best to spend the yearly $100,000 locally by hiring a clinical health specialist to work with police officers and code enforcement to first document the current homeless population and where they are living. The health clinician can assist the homeless in requesting help with available resources. It’s obvious to anyone driving down the main street of Palm Drive every day seeing homeless people sleeping on city sidewalks next to businesses that we have a health & welfare human crisis.

Additionally, a part-time sidewalk cleaning company needs to spray wash sidewalks weekly to keep business entrances and bus stop areas clean of trash. Lastly, currently, the city’s homeless population has created living camps at two closed-down resorts in the city. The Sahara Spa Resort and the Las Palmeras Spa Resort are in our current District 3 and neighborhood residents have been complaining of trash and vandalism on their property. This should not be happening in a city that prides itself on being a health & wellness community.

UR: Is there one decision with City Council has made with which you strongly disagree? If so, what was it and why?

Adam Sanchez: The City Council chose to use tax revenue from the Cannabis industry to pay for ongoing expenses rather than treat it as one-time money. The funds should have been treated as one-time money and used for infrastructure projects. It was a financially bad approach and one with which I strongly disagree. Using the funds for infrastructure would supplement future budgets by reducing strain on future budgets. Further, the present grant environment is one of money flowing from State and Federal sources for shovel-ready projects. The cannabis funds would have served as significant leverage for many much-needed public works projects in the city.

From a taxation standpoint, treating Cannabis revenue to handle ongoing expenses has made the city extremely reliant on present taxation levels. The Cannabis industry is in serious need of financial relief. The only way the city can now offer that relief will be for the city to cut back on staffing and services. Cities make those decisions reluctantly under any circumstance. It is a worse circumstance for the city presently. The city will have a difficult time financially cutting the square foot tax rate from $10/sq foot to $5/sq foot or reducing the tax rate on retail cannabis. Both of those steps are needed to maintain the fantastic levels of employment that have come to our city.

UR: Desert Hot Springs has a significant LGBTQ population and it’s growing, we are told. What have you done, or will you do to better help this population?

Adam Sanchez: Every group of residents in our city will get the help and attention they need for issues that arise. No group will or should be excluded. At the most basic level, City Councils are about providing services to residents. That is universal and all-inclusive.