Is Sacramento cracking up?

What does Arden Arcade have that other communities don’t? Well, lots of streets named after inventors. There’s Watt (we associate him with light bulbs, but he helped perfect the steam engine), Edison (the phonograph), Howe (sewing machines), Fulton (the steamboat). It also has lots of shopping centers, nondescript apartment complexes and auto dealers. In that way, it’s one of those big stretches of the unincorporated county—not inside any city’s boundaries—that looks a lot like other big stretches of the unincorporated county.

Given that Arden Arcade may become its own city soon—if voters there approve a cityhood proposal on the ballot this November—it’s tough to say where the civic heart of Arden Arcade might be.

Where will they put City Hall? At the Town & Country Village on Fulton and Marconi avenues? At the Pavilions shopping center on Fair Oaks Boulevard? Certainly not at the old auto row along Fulton Avenue.

These are not exactly places that make you think “city.” But these commercial centers do make Arden Arcade one of the economic powerhouses of Sacramento County. In fact, the area generates more in property taxes and sales taxes than it receives in county services, like cops and road maintenance.

“We’re basically the revenue generator for the rest of the county,” said Rob Harrison, who lives in the Arden Terrace neighborhood and who serves on the board of the Fulton-El Camino Recreation and Park District. “Sixty percent of the tax revenue earned in Arden Arcade goes out.”

Activists like Harrison are pushing to get Arden Arcade incorporated into its own city, in order to maintain a quality of life they fear is in decline, along with the county’s long-term fiscal health. And they want better elected representation than they get now. “Self-determination is the bedrock of democracy,” Harrison said.

But critics say it’s not fair for one area to take revenue away from the rest of the county, to have better police protection or roads or parks, while other neighborhoods suffer. After all, people from all over the county and the region shop—and pay sales taxes—at those same auto dealers and shopping malls. Take that revenue away and you may “ghettoize” the remaining county.

And a lot of people who live in Arden Arcade think of themselves as being part of Sacramento.

“Arden Arcade? What is that? A carousel? A pinball machine?” asked psychologist Mike Duveneck, leader of the anti-cityhood group called Stay Sacramento. “This is Sacramento. We identify with Sacramento, the place, the Kings, the rivers, all of that.”

Incorporation backers fear that if Arden Arcade doesn’t become its own city, then the neighboring city of Sacramento will “assimilate” the community in a few years.

And it might. The county is finding it more and more difficult to provide urban services, something that counties really aren’t designed to do. And Sacramento is unusual in having such large urbanized areas outside of city limits. Some say it’s time for the county to get out of the business of delivering municipal services, like cops and code enforcement and parks, altogether.

There’s a lot of agreement that the current system isn’t working, but little consensus on what should take its place.

By the numbers, Arden Arcade would make for a pretty respectable city. It would contain about 90,000 people, and cover about 13 square miles.

Mission Avenue would form its eastern edge, bordering Carmichael. It would be nestled up against the city of Sacramento on the west, with Ethan Way as the dividing line. The city would also share its northern border, Auburn Boulevard, with the city of Sacramento, while its southern edge would butt up against the American River Parkway.

That’s roughly the same size and population as Citrus Heights. By comparison, the most recent data say Sacramento city contains 490,000 people, Elk Grove 130,000 and Rancho Cordova just 60,000.

For the longest time, Sacramento County was a fairly urban area with very few cities. The city of Sacramento, of course, was born out of the gold rush in 1850. Isleton is the next oldest city, incorporated in 1923. Folsom and Galt joined in 1946. And for 50 years, that was it; no new cities were formed.

But the county started to Balkanize in the late 1990s. In 1997, Citrus Heights broke away, drawing its city limits around, and staking its financial viability on, Sunrise Mall. Elk Grove and Rancho Cordova followed in 2000 and 2001, and each have grown quickly. In fact, Elk Grove was the named the fastest-growing city in America by the U.S. Census Bureau in 2005.

Arden Arcade is a little different; it’s been highly urbanized for decades. Harrison notes that half of the population are renters, higher than the county average. And unlike the newer suburban cities of Elk Grove and Rancho Cordova, Arden Arcade is mostly built out, with little open space to add new development.

And Arden is elbow to elbow with the city of Sacramento, which has expressed interest in annexing the area, but has been quietly biding it’s time.

Harrison and his cohorts don’t want to see that happen. They look at City Hall and the budget problems, the slashing of services, and worry they’ll be worse off than they are now.

At the same time, they don’t want to go down with Sacramento County’s ship. The county is trying to close a $122 million budget gap, with deep cuts to mental-health services, code enforcement and sheriff’s patrols.

Sheriff’s vice and narcotics units in the county have been eliminated, along with many of the “problem-oriented policing” teams for Watt Avenue, Fair Oaks, Carmichael and Arden.

“Due to the cuts and the lack of proactive policing, we’re seeing quality-of-life issues crop up, and petty crimes are going up,” said Capt. Stephen Bunce, commander of the Sacramento County Sheriff’s North Division.

Bunce added that prostitution activity has surged in the hotels along Watt Avenue, and has made something of a comeback on Auburn Boulevard, too. “A year ago, we had it under control. Now we’re starting to lose some of that control,” Bunce explained.

And Harrison points at some high-profile violent crimes—including a recent three-day standoff with a mentally disturbed man who took a toddler hostage on Arden Way, and a recent murder on Howe Avenue—to underscore the need for better police protection.

Throughout California, it’s the cities that primarily provide police services, along with trash pickup and code enforcement, and parks and city planning. Counties tend to be more focused on health and human services—welfare, public health, running elections. In this way, they behave more like an arm of state government.

For several reasons—including the historic influence of large military communities, like the Mather and McClellan Air Force bases—Sacramento County allowed large new areas of urban growth outside of its cities. But that meant the county had to take on the responsibility of providing urban services.

With the wave of defections by Citrus Heights, Elk Grove and Rancho Cordova, the county’s tax base shrank; it became more difficult to provide services to those areas left behind.

As they broke away, each city struck a “revenue neutrality” deal, a sort of alimony payment, to the county. And under the proposal that will be on the November ballot, the city of Arden Arcade will have to pay the county nearly $9 million every year.

But even with revenue neutrality, critics say the larger county ends up losing. “As you have more and more incorporation, the county is left with more of the dregs, less affluence and less of a sales-tax base,” said Al Sokolow, a public-policy professor emeritus at UC Davis.

Backers of cityhood agree with this analysis, they just disagree on the solution. Harrison said he thinks the incorporations of Rancho Cordova and Elk Grove, and their ability to more effectively police their own communities, has exacerbated the crime problem into the unincorporated areas. And he thinks Arden Arcade incorporation will put more pressure on neighboring communities like Carmichael or Rio Linda to incorporate or, more likely, join existing cities.

You’ve heard the old saying “All politics are local.” But some politicians are more local than others.

Right now, the people of Arden Arcade are represented by one elected supervisor, Susan Peters, who is one of five members on the county board. Her district contains more than 250,000 people, and Arden Arcade is just one part of that district, along with North Highlands, Carmichael, Foothill Farms and parts of the city of Sacramento.

If cityhood passes, Arden Arcade would have a seven-member city council, with six members elected by district and a mayor elected at large. Cityhood would mean one elected representative for every 15,000 citizens.

Proponents of cityhood started gathering signatures back in 2006 for their cause. They needed 14,000 signatures to try to get onto the 2008 ballot. “It was a grassroots effort, and it was a lot of work. We were failing miserably,” said Joel Archer, a financial-services consultant who has since taken over as chairman of the incorporation effort.

He raised $10,000 from clients and friends and hired a signature-gathering company. Cityhood got enough signatures to start the process with the Sacramento County Local Agency Formation Commission. As it turned out, it took three years and $300,000 worth of economic studies and environmental-impact reports to make it to the ballot.

Thanks to its considerable sales-tax base, and the fact that a city can capture certain revenue streams available only to cites, like $6 million in vehicle-license fees, the city of Arden Arcade would have a $57 million surplus after 10 years, at least if LAFCo’s projects for the revenue and costs of running the new city hold up.

But opponents say the studies make too many rosy assumptions and rely too heavily on commercial centers—like car dealerships—with uncertain futures. “This is probably the worst time in the world to try and start a city,” said Duveneck. And he said the incorporation backers are underestimating the size and cost of the new government they want to create. “I think they’re highballing their revenue and lowballing their costs.”

But the economic analysis was enough for LAFCo to agree that potential Arden Arcadians should have a vote on cityhood this November. The county board of supervisors still must give its consent for a ballot measure. But that’s mostly a formality at this point.

Duveneck’s opposition group is making the argument that cityhood will lead to higher taxes, and that it won’t fix the area’s problems.

“Susan Peters is doing a good enough job. The garbage is getting picked up,” said Duveneck.

He lives in the Arden Park neighborhood, not far from the American River. And Harrison said he thinks the more affluent sections of the proposed new city tend to be more anti-cityhood. Arden Park resident Lou Blanas is one of the higher-profile opponents.

Arden Park residents have hired private security patrols for the neighborhood, and they have their own small park district, based on a small property tax that Arden Park homeowners pay. “They get what they want down there. We get what the county wants up here,” Harrison said.

The Stay Sacramento effort is already raising money to defeat incorporation at the ballot. Duveneck said his side has raised just “five or six thousand dollars,” but he was getting ready for a big fundraiser. For $5,000, donors can be named “co-chair” of the Stay Sacramento campaign; $2,500 just gets you listed as a campaign supporter. So far, Stay Sacramento hasn’t had to report who its donors are.

The pro-incorporation group was also initially reluctant to reveal who financed the various studies and fees that the group had to provide to pass legal muster. Technically, the group had no legal obligation to reveal its financial backers until cityhood was approved for the ballot.

But after months of complaints by the opposition and accusations that they were hiding something, the pro-cityhood side finally listed their donors on their website this spring.

Many of the large donors turned out to be the unions and companies who will be jockeying for contracts if the new city incorporates. The Sacramento County Deputy Sheriffs’ Association has given $7,500 so far. Pacific Municipal Consultants, a company which specializes in privatized government functions—and helped Elk Grove and Rancho Cordova get up and running—gave $4,000. Joel Archer, who is considering a run for Arden Arcade city council during the November election, has given more than $14,000 himself.

The incorporation bid also got a good chunk of its money from the cities of Elk Grove, Rancho Cordova and Citrus Heights.

“It’s a power struggle. They want another city to sit with them on those regional boards, and power away from the city of Sacramento and from the county,” said Duveneck.

But the most controversial donations came from Fulton-El Camino and Arden Manor recreation and parks districts, which gave a combined $30,000. Again, the donations were legal, but because some of the park district board members were also cityhood proponents, they were accused of having a conflict of interest.

The incorporation committee made matters worse when it seemed to be trying to hide the donations from these groups by listing them as “Sacramento County,” instead of listing the contributions by the individual park district names. City backers said this was a mistake, and that although the checks did come from Sacramento County, it should have been clear the money was coming from the parks districts.

Then the incorporation group got in even more trouble when it failed to register with the California attorney general as a nonprofit organization.

Incorporation backer Mike Grace, whose day job is as superintendent of the Fulton-El Camino Recreation and Park District, characterized all of the above as stumbles, made by regular citizens attempting the complicated task of forming a new city.

“There were some mistakes we shouldn’t have made, but those don’t take away from the reason for cityhood.”

But cityhood opponents play up the significance of the blunders. “There’s this sleaze factor,” complained Duveneck. “If you’re going to do this kind of stuff now, what are you going to do when you become a real city?”

“If the vote were to happen today, I don’t think it would pass,” said Grace. He is considering a run for city council of Arden Arcade, though he said his mind changes from day to day. He thinks residents haven’t really engaged and don’t understand the issues of incorporation. And incorporation backers have just four months to make their case to voters. Part of the problem may be that lack of identity. Perhaps a new name would help. “I think it should be called American River,” Grace mused.

If incorporation doesn’t go through this year, said Grace, he expects the city of Sacramento to begin the process of annexing Arden Arcade.

That would be fine with some people. “Growing up, I never thought of it as Arden Arcade,” said Rob Turner, one of the owners and publisher of Sactown Magazine.

Turner grew up in the neighborhood of Sierra Oaks, one of the areas that would be part of the new city. His old street is half in the city, half in the county. Last month, he penned an essay, “Town and County,” in which he made the case against incorporation and for joining with the city of Sacramento.

He explained that many of his friends and family still live there. “And most of the people I’ve talked to, they really feel like they’re part of the city of Sacramento,” he said. “If you look at a map, it’s clear that there’s this bite out of the city of Sacramento where Arden is.”

Steve Cohn, who serves on the Sacramento City Council and also as the chairman of the Local Agency Formation Commission agrees, but said it can’t be a hostile takeover.

“My own preference would be that Arden should annex, but they don’t seem to feel that’s their best option,” Cohn explained.

Indeed, both sides of the incorporation debate in Arden Arcade say publicly that they very much don’t want to be annexed.

“Our taxes would just go from one place on I street to another place on I street,” Harrison explained.

“It would be like the Borg; we’d be assimilated,” Grace added. Both men, representing the local park district, noted that their swimming pools will remain open this summer, while the several city of Sacramento pools are expected to be close due to budget cuts.

In 2009, the city of Sacramento decided as part of its general plan that Arden Arcade would be a “study area,” for eventual annexation. But given the nervousness of some residents, the new growth manager Scott Mende takes pains to say that nothing is imminent.

“It is an area that we’re thinking at some point we may want to entertain for annexation someday in the future,” Mende told SN&R. Then, perhaps feeling he’d gone out on a limb, added, “There’s no direction from the city council to proceed on that any time in the foreseeable future.”

The city of Sacramento could, however, move to place Arden Arcade within its “sphere of influence,” and that would scotch any future incorporation efforts. But there are other options for Arden Arcade, and for the rest of the unincorporated urban area.

“I’d like to see serious consideration of city-county consolidation. I always thought that was a very good idea,” said Al Sokolow.

In 1990, voters shot down a measure to merge the city of Sacramento with the county of Sacramento, with a single council of supervisors and combined services. Conservative groups were sure the merger would lead to higher taxes; more liberal political interests in the city worried about losing power to the suburbs.

With the defeat of Measure S, a wave of new cities followed.

But Sokolow said it makes sense to at least reconsider consolidating some major services like public safety and parks. It’s something that Sacramento City Manager Gus Vina, as well as interim County Executive Steve Szalay have been talking about on a more limited scale, consolidating certain law-enforcement functions, like SWAT teams or helicopter services, or animal services.

Sprawl, public transportation and air pollution have all prompted local governments to talk about “regionalism” for years. But the collapse of revenue streams for local government may spur more than talk. “The last thing we need right are all these little fiefdoms running around,” said Duveneck, noting that the trend has been toward more cooperation between local governments, not less.

Rob Harrison agrees that the county needs regional solutions. But he talks about a countywide “metro plan” in which the remaining unincorporated areas of the county would be incorporated or annexed to existing cities. For example, he sees the city of Arden Arcade as logically extending its influence into the adjacent community of Carmichael.

All of these ideas should be on the table, said Cohn. “It’s really past time that we get proactive about this. We should get all the cities and the county, and the neighborhood groups, labor groups, and all the constituents and plan for the transition.”