Last week, a Los Angeles County Superior Court judge ordered the Irwindale, California plant that produces the highly popular “rooster sauce” Sriracha to cease operations that could be emitting odors that are “extremely annoying, irritating and offensive to the senses warranting consideration as a public nuisance.”
Too bad the judge didn’t apply the same logic to the city government of Irwindale and shut it down too.
A brief introduction to the conflict: On one side is David Tran the immigrant founder and CEO of Sriracha’s maker, Huy Fong Foods, who claims the rooster sauce (made of chili peppers, distilled vinegar, garlic, sugar and salt) is being scapegoated and worries (along with Sriracha’s many fans worldwide) that court action will threaten the company and its precious sauce supplies. On the other side are Irwindale city officials, who sought the judge’s order and claim the Huy Fong plant is producing odors that burn throats and cause coughing fits, gagging, and even nosebleeds.
But the stench of Sriracha has obscured a far more toxic California problem at play in the dispute: our state has far too many local governments for its own good.
Irwindale, one of California’s more than 6,000 local governments, is not so much a city as it is a playland for 700-some businesses. The city has nearly 30 times more workers (40,000) than actual residents (1,400), and residential neighborhoods take up less than one percent of its 9.5 square miles.
And Irwindale is not alone in having such odd proportions. Vernon, a city of 112 people and 1,800 businesses, is so relentlessly corrupt that Assembly Speaker John Perez championed legislation to disincorporate it two years ago. Vernon fought off the municipal death penalty by buying off opponents, including a promise of $60 million in donations to its neighbors.
Small, not-quite-cities like Irwindale are often the sites of disputes between small local factions over the city’s spoils—jobs, development incentives, city contracts, special services. Occasionally, outside authorities—a county district attorney or an air quality regulator—intercede to stop the worst abuses, but they invariably retreat without resolving the larger structural problem. California has little in the way of government at the regional level, and its state government is distant and out of touch. So no one can rein in the Irwindales.
Instead, California local governments, left to their own devices, compete to exploit loopholes in the state’s dysfunctional tax and budget systems. Those with the fewest scruples tend to turn those loopholes into incentives to bring in businesses and provide lavish salaries and perks to public employees and, in the cases of some small cities, the residents themselves. Corruption sometimes results. It’s hardly surprising that two Irwindale city councilmen, a former city councilman, and the retired finance director currently face charges of embezzlement, misappropriation of funds, and conflict of interest.
The deal that brought Sriracha to Irwindale three years ago was smelly to begin with. The city used redevelopment dollars (essentially, property tax money that would otherwise go to schools) to offer Hoy Fung Foods a sweetheart loan as part of a deal to build a $40 million plant on Azusa Canyon Road. In a recent open letter, CEO and founder Tran wrote that he found the loan terms to be “irresistible,” but that he grew so nervous about Irwindale’s government that he paid off the loan with bank financing on less generous terms. Everyone in this dispute has a different deal with the Devil.
By the way, I can’t help mentioning an especially rich irony: two years ago, when California city leaders were trying to stop the state from shutting down local redevelopment agencies, they cited Irwindale’s Hoy Fung Foods deal as the sort of development they wished to preserve.
Today, the community redevelopment agencies are gone, but Irwindale, sadly, is not. So how to shut it—and other cities—down? The best idea for consolidating cities was suggested in 1996 by the California Constitution Revision Commission, which recommended giving citizens in each California region the power to rethink local governments and produce new regional charters.
One day last month, I stopped by the Hoy Fung plant and walked around the neighborhood. There was clearly an odor—it reminded me of the garlic you smell while driving through in Gilroy in Northern California—and those who complain say it gets much worse during chili-processing time. But it wasn’t nearly as strong as the scent of coffee when I drove by the Starbucks three blocks away, or of the truck exhaust that seems to be everywhere in this part of the San Gabriel Valley. Irwindale may be able to rid itself of the stench of Sriracha, but that won’t change the fact that local governance, here and across California, stinks.