Sierra Madre Wine & Jazz Walk

Saturday, October 8, 2011


SATURDAY, OCTOBER 8, 2011

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..................VOLUME 5 NO. 41

SIERRA MADRE BUSINESS UPDATES - Part I

Proposals, Openings, Expansion, Remodels and Recently Listed by Chris Bertrand 

Sierra Madre Water Enterprise 
Credit Rating Downgraded

Insufficient Rate Increase Cited

By Susan Henderson

 

 Sierra Madre made national news this week when a pair of mountain lions 
decided to take a break in one resident’s front yard. That appeared to be the talk 
of the town until a story broke in the Pasadena Star News on Friday regarding 
the downgrading of the city’s water bond credit rating. 

 The report, which erroneously reported that the bonds were downgraded “from 
AAA to an A bond rating”, lead to allegations that the city had mislead opponents 
of the water rate increase by failing to disclose the impact of not enacting 
the rate increase as recommended by staff would have on the water enterprises 
bond rating. However, that fact was presented to the public on numerous occaisions 
by city staff. Many who opposed the increase were concerned because, 
“the proposed rate increase covered only the bond requirements and projected 
operational expenses”.

 When the council finally passed the increase, after months of re-education of 
the public and then Mayor Joe Mosca’s efforts to bring the community together, 
it reduced the amount of the increase from the approximate $8 per month per 
ratepayer in response to those who objected to the increase. At that time, it 
was stated that the city would review the impact of the reduced rates in a year. 
However, that action was the impetus behind the downgrade.

 On September 30, 2011, Moody’s Investor Service, a leading provider of credit 
ratings, research, and risk analysis downgraded the City of Sierra Madre’s Water 
Enterprise Revenue Bonds to “A3 from A1”. The bonds , which are secured 
by the net revenue’s of the city’s water 
enterprise system, have an outstanding 
balance of $3.4 million dollars.

 According to the letter issued to the city 
by Moody’s states, “Because it failed to 
reach its rate covenant in 2010, the City 
Council successfully completed a Proposition 
218 Protest Process in July, 2010, a 
necessary step for adoption of a five year 
rate increase. The rate increase would 
have rectified the rate covenant issue 
within 90 days. However, City Council 
delayed implementing the rate increase 
for one year to get residents more aware 
of the coming rate increase”. The notification 
goes on to list what could make 
the rating move up: “Significant increases 
in debt service coverage achieved and 
maintained over the long term

 Sustained implementation of regular 
rate increases which would bolster unrestricted 
cash reserves.”

 The city’s water enterprise, which has 
been rated by Moody’s since 1998, has 
never had an AAA rating. According 
to David Jacobson AVP - Communications 
Strategist, Public Finance Group at 
Moody’s Investors Service, “Moody’s has 
rated the Sierra Madre Water Enterprise 
A3 since its inception in 1998. When the 
rating was recalibrated in April 2010, it 
was recalibrated as an A1 rating. Then 
the downgrade last week took it to an A3.” 

 According to City Manager Elaine 
Aguilar, the impact of the downgrade 
changes the interest rate that the city 
can borrow money should we have an 
emergency.

 The City’s water enterprise is not the 
only agency whose credit rating is under 
review. According to Jacobson. the 
Sierra Madre Redevelopment Agency’s 
rating, along with every other California 
RDA is under review. That review 
will be done after the California Supreme 
Court’s rulling on Governor Jerry 
Brown’s effort to dismantle the agencies 
statewide. That ruling is expected in 
January, 2012.

BOWDEN DEVELOPMENT 
REVEALS SM BOULEVARD 
TOWNHOME PROPOSAL 

 Bowden Development of Monrovia 
appeared before the Sierra Madre 
Planning Commission on September 
15 regarding their interest in developing 
a six unit townhome project on the 
corner of E. Sierra Madre Boulevard 
and Sierra Place. 

 The current configuration, subject 
to change and the approval process, 
includes six units in a Craftsman 
style with current sizes ranging from 
1357 square feet to 1522 square feet. 
All townhomes currently have three 
bedrooms plus two and one half 
baths. The four that face Sierra Madre 
Boulevard have an elevator option, 
which commissioners liked, as it 
affords elderly residents the option of 
“aging in place” in a two story home. 

 The project’s proposal received a 
favorable initial reception from the 
commission, with members thanking 
Bowden for the completeness and 
detail level of this initial presentation. 
Project director, Richard Tipping, 
said, “We were pleased with the city’s 
appreciation of the hard work that 
went into providing them with a clear 
picture of what we propose.” 

 Tipping indicated that Bowden is 
making changes in the plans regarding 
rooflines, front door direction and 
other commission requests, and plans 
to return sometime in October with an 
updated plan, then to the City Council 
after that. For more information about 
the project, contact Richard Tipping at 
Bowden Development at 626-303-7917 
or RTipping@BowdenDevelopment.
com.

SIERRA FITNESS EXPANDS 
INTO FORMER LA BELLE 
ROUGE STOREFRONT

 On Saturday, September 24, Sierra 
Fitness formally opened their new 
Pilates Reformer Studio at 34 N. 
Baldwin in Sierra Madre, with food, 
festivities, demonstrations and a day of 
free classes. The new space will house 
the private and group classes in Pilates 
Reformer for up to nine students at a 
time. 

 Owner Sandy Lewis-Duvall expanded 
the main part of the fitness facility 
just last year, taking over the second 
floor of their two story building at 20 
N. Baldwin, to create a new classroom 
facility for Zumba®, step, Pilates mat, 
core, yoga and other classes, plus a 
separate spinning studio. In addition, 
the facility offers personal training 
by degreed or certified professionals, 
nutritional counseling and workout 
equipment.

 Lewis-Duvall also recently opened 
The Shabby Dog, another nearby 
business only a block away at 31 E. 
Montecito, with designer pet items, 
pet day care and grooming. For more 
information, including a tour of the 
new facilities, visit call 626-836-1236 
or visit www.SierraFit.com and www.
TheShabbyDog.com.

OWNER UPDATING 
FORMER STEAMERS 
BUILDING FOR RETAIL/
RESTAURANT AND 
OFFICES UPSTAIRS

 The owner of the two story building 
at 138-146 W. Sierra Madre Blvd., is in 
the process of updating and upgrading 
the property for new tenants. After 
extensive work with the City of 
Sierra Madre, the property will have 
a divisible restaurant or retail space 
on the street level. This will hopefully 
extend the foot traffic path further 
west, as per the city fathers’ vision for 
a revitalized downtown Sierra Madre. 

 The main floor is being fitted with 
separate HVAC and electric meters 
for up to four divisions of the 5500 
square foot gross leasable space. The 
owner indicated that in doing so, he 
hopes to entice new unique food or 
retail businesses with a small space 
and reasonable rents. He envisions 
something in the spirit of the 
uniqueness of Sierra Madre, which first 
struck him as similar to the European 
towns of his wife’s heritage. He hopes 
for a ‘non-franchise” business with an 
owner-operator onsite, doing what they 
do best, their unique specialty whether 
it be desserts, crepes, sandwiches or 
whatever in a beautiful modern, well lit 
space with reasonable rents. 

 The smallest divisible space is 
approximately 1000 square feet, and 
the maximum contiguous space is 3000 
square feet on street level. He indicated 
that this smaller space should entice 
local entrepreneurs to take the plunge 
into their own businesses without 
having to commit to rents of $5000 a 
month, etc. 

 Upstairs, the office space will now 
be accessible by a new elevator, which 
makes the space better suited to a 
medical or other office. Updating is 
expected to be complete and ready for 
occupancy in March, 2012. For more 
information, call 310-766-0588. 

Facelift in Progress for Former 
Highland Liquors Building Building 
owner, Nancy Schollenberger, is 
updating the interior and exterior of 
the former Highland Liquors. “The 
3400+ square foot building at 303 W. 
Sierra Madre Boulevard, is currently 
going through some updating and will 
be ready to rent November 1, 2011. 
There are some people interested in 
renting it, but no lease has been signed 
and no money has changed hands,” she 
said. 

 She was hoping for an Italian Deli, 
“but we… are not sure at this point. 
This would be a wonderful addition 
to Sierra Madre, if we can get past 
the setbacks. Keep watching.....when 
we have someone definite, the City of 
Sierra Madre will be told immediately!” 

The building is one of the larger 
commercial buildings on the West side 
of town, and would generate increased 
foot traffic as an “anchor” for that area 
of the business district. 

MOODY’S INVESTORS 

SERVICE RATING SYMBOLS 
AND DEFINITIONS

Long-Term Obligation Ratings

Moody’s long-term ratings are opinions of 
the relative credit risk of financial obligations 
with an original maturity of one year 
or more. They address the possibility that a 
financial obligation will not be honored

as promised. Such ratings use Moody’s 
Global Scale and reflect both the likelihood 
of default and any financial loss suffered in 
the event of default.

Aaa Obligations rated Aaa are judged 
to be of the highest quality, with minimal 
credit risk.

Aa Obligations rated Aa are judged 
to be of high quality and are subject to 
very low credit risk.

A Obligations rated A are considered 
upper-medium grade and are subject 
to low credit risk.

Baa Obligations rated Baa are subject 
to moderate credit risk. They are 
considered medium grade and as 
such may possess certain speculative 
characteristics.

Ba Obligations rated Ba are judged 
to have speculative elements and are 
subject to substantialcredit risk.

B Obligations rated B are considered 
speculative and are subject to high 
credit risk.

Caa Obligations rated Caa are judged 
to be of poor standing and are subject 
to very high credit risk.

Ca Obligations rated Ca are highly 
speculative and are likely in, or very 
near, default, with

some prospect of recovery of principal 
and interest.

C Obligations rated C are the lowest 
rated class and are typically in default, 
with little prospect for recovery of 
principal or interest.

Note: Moody’s appends numerical 
modifiers 1, 2, and 3 to each generic 
rating classification from Aa through 
Caa. 

 The modifier 1 indicates that the 
obligation ranks in the higher end of 
its generic rating category; the modifier 
2 indicates a mid-range ranking; 
and the modifier 3 indicates a ranking 
in the lower end of that generic rating 
category.

 
As part of its 80th Anniversary Celebration, 
the Sierra Madre Historical Preservation 
Society presents, “The Way We Were: An 
Historic Adventure with Costumes” on 
Saturday October 15th at 2 pm. Costume 
Historian Shon LeBlanc of Valentino’s 
Costumes will narrate this eye-catching 
show. Tableaus of models will show us 
how Sierra Madre folks dressed through 
the ages. A delicious Victorian tea will 
accompany the fashion revue to be held at 
Hartzell Hall, 695 W. Sierra Madre Blvd., in 
Sierra Madre.

In addition to the tea and costume 
presentation, the Society will place a 
number of silent auction items up for 
bid. A Leonora Moss floral arrangement, 
a photographic print by a local artist, and 
gourmet food and wine pairings are just a 
few of the enticing silent auction offerings. 

Proceeds from this unique event support a variety of 
educational activities. The Society hosts several school 
and group visits at its museums, Lizzie’s Trail Inn and 
Richardson House. The Society also offers walking 
tours and historical presentations to local schools 
and organizations. Funding from the Society directly 
supports the Local History Collection at the Library. 
This year the Society is providing matching funds for 
an intern from the UCLA School of Education and 
Information Studies to render more of its collections 
online.

Tickets are $40 each and are available for purchase at 
Arnold’s Hardware, Mary’s Market, 
Prudential Realty, Savor the Flavor, 
and the Sierra Madre Public Library. 
Don’t miss this opportunity to see 
“The Way We Were!”

Inside This Edition...

SIERRA MADRE HISTORICAL 

PRESERVATION SOCIETY TAKES US 
BACK TO THE WAY WE WERE

CALENDAR Page 2 

Sierra Madre News Page 3

Pasadena/Altadena Page 4

Around San Gabriel Valley Page 5

Arcadia Page 6

Monrovia/Duarte Page 7

Education & Youth Page 8

Nature & Environment Page 9

Arts & Entertainment Page 11

Left/Right Page 12

Opinion Page 13

Legals Page 14/15 The World 
Around Us Page 16

 The Good Life Page 17

Homes & Property Page 18


Models adorned in Valentino’s costumes 
accompany Sierra Madre’s award-winning 

Tournament of Roses Float Valentine’s Day in 
2008.


Read The Paper Online At: www.mtnviewsnews.com