Church/Playhouse Will Co-Use Theater

Visalia - Let’s divide the baby in half. That was the Biblical solution offered by King Solomon. But this week it may have been the Visalia city manager Steve Salomon’s wisdom that came up with a common sense solution to a drawn out lawsuit in which there would have been no winner.

Over a year long lawsuit appears to be settled this week between a local church group who sought to buy the Main Street Theater in downtown and the City of Visalia that stepped in to buy the property by eminent domain to allow its continued use by a popular children’s theater group.

Restoration Church had the property in escrow and their attorney argued that the city can’t come in “at the last moment and steal it away from them” in comments made in 2004.

But this week Visalia city attorney Alex Peltzer says both sides in the closely watched dispute agreed to settle the lawsuit in comments made in open court and the issue was agreed to by Judge Melinda Reed who overrode objections against the settlement from its current property owners, the Martin family.

“All the details are not final, but in general the plan is to have Restoration Church and the city own the theater 50/50,” says Peltzer and to divide its use in a mutually agreeable schedule as well. That would allow the theater to be used say on Friday and Saturday for children’s theater while the church would get the building’s use for church service on Sunday and likely several week days. It is the city’s intention to sell their interest to the Enchanted Playhouse group - the long time children’s theater troupe that currently operate the old Main Street Theater building.

Restoration officials were not available for comment at press time. The church is run by Dr. Robert Hooks who ministers to “forgotten” ones in their northside facility “helping transform them into strong and effective Christian leaders,” according to their web site. They had maintained to the city at the time of their application for conditional use permit in 2003 that they planned to offer service in the Main St. building but run a soup kitchen or the like amid concerns that the homeless would frequent the facility.

But the city’s main concern was the potential loss of decades worth of community theater at the location that was part of the city effort to restore Downtown, maintained mayor Bob Link, noting that “the arts” are part of our economic development strategy.

The city took the property in eminent domain action and yet to be decided is just how much they will pay the former owners in the sale. Restoration had offered a higher figure than the city had been willing to make during negotiations a few years ago.

There is suggestion that the Martin family - not happy with this outcome - is starting to get State Senate interest in investigating what they believe was an abuse of the eminent domain process and if that happens, they hope this won’t be the end of this.

Restoration had hired the high-powered Pacific Justice Institute to carry their legal case that the city was violating their constitutional rights under the Religious Land Use and Institutionalized Persons Act (RLUIPA). The city had, on the other hand, maintained the city had a right to take the property for a public purpose - the maintenance of an art district in the Downtown. Now it looks like people will both pray and play on Main Street.

The Restoration Church will be able to hold services and other activities in the building sharing their front door key with a children’s theater group whose events will be scheduled around others. Maybe not an ideal solution - but better than cutting the baby in half.

A court date of next Tuesday, October 11 is set to decide how much the owners will be compensated in this case.

---

Council Candidates Address Economic Development

Visalia - Visalia city council candidates addressed business questions at a morning forum held be the Visalia Chamber of Commerce and Visalia Economic Development Corporation this week.

Rather than have an open forum format, the business leaders asked council candidates to address specific questions of how they would improve the economy in Visalia and whether they support the city’s 2020 growth plan. Perhaps not surprisingly, all 7 candidates uniformly salute the 2020 plan used as the template to expand the city until the year 2020.

The concentric growth circles assume ground zero as Downtown and each candidate noted their strong support for Downtown - and the current city plan to expand downtown big time to the east. Here is a sampling of some of their remarks, particularly as it relates to growth and economic development in Visalia.

Amy Shuklian: Amy, who works for Kaweah Delta wished she worked in the Downtown campus area with all its activities and she misses the area. She says she is excited about city efforts to rejuvenate east Visalia and the northside’s new “Community Campus” area and the Manuel Hernandez center. The city recently got a grant to put in more park area and kids soccer sports fields, part at the community campus area - the former juvenile hall site. Regarding economic development, she states the city needed to pay attention to the needs of small business.

Don Landers: Says the city has been following the 2020 plan and notes criticism by some that allowing the big Shannon Ranch project was leapfrog development - noting it was within city growth boundaries and reminding us that the city was installing sewer lines nearby. Regarding economic development Landers noted that he helped get the city back into the Tulare County EDC and cites the city’s record low 5 ½% unemployment rate.

Victor Perez: Says his years as a Downtown property owner and member of Downtown Visalians shows his commitment to the downtown area but claims Downtown vitality “doesn’t just happen by osmosis.” He says the east Visalia plan is not just infill but multi use plans for combining residential, commercial and retail and public uses. Regarding the town’s rapid growth, Perez suggests the city might want to examine its efforts to attract distribution centers because of air quality problems and says Visalia needs good paying jobs.

Walter Deissler: Says he is in favor of “growing inwardly and upwardly rather than outwardly.” He suggests expansion of the city’s downtown finance district. Regarding economic development he is in favor of the new city plan to offer incentives to companies under the right conditions, but asks “what about small business?” Deissler says he wants to “keep Visalia’s uniqueness.”

Sam Logan: Says he is excited about the east Visalia plan in that city hall will get as much as 6 stories like the hospital and the new hospital support building and add multi story parking lots in an effort to create a more dense Downtown area. Regarding one key feature for Visalia that is missing - no four year college. He suggests Visalia travel to the state chancellor’s office at every monthly meeting to complain about it.

Greg Collins: Says he has a four point program for economic development in the city. 1. Work to expand the industrial park including the annexation to the north now underway. 2. Play to your strength including the expansion of the Visalia airport. 3. Organize an ag enterprise district where farmland on the edge of town we want to save would get the chance to site an ag related industry in exchange for keeping the balance of land in farming. 4. Expand East Visalia plan to include the stockyard and add high rise affordable housing.

Jesus Gamboa: Says he has been guarding the general plan and does job creation for a living as administrator with Proteus Job Training. He notes that north Visalia in the past had been left out of the economic development loop and hailed the new backing supporting the city plan a few years ago pushing more growth to the north. Gamboa supports expansion of the industrial park and says our private partnerships need to work together to promote economic development. Gamboa says he supports the fact the city has now budgeted to pay companies an incentive to locate here if the revenue coming in will justify it.

---

Mearles Drive-In Faces Lean Times

Visalia - Arguably one of the most famous landmarks in Visalia and one of its best known eateries, Mearles Drive-In on Mooney is facing lean times, says its current owner Melissa Ward. The restaurant, that celebrated its 65th birthday a few days ago, is not getting the crowds it once did and is facing higher costs to stay open.

To make matters worse, Ward says the restaurant faces a lawsuit over handicapped access issues that could force the eatery to spend big time to upgrade the facility - a place they don’t own, just rent from a Fresno owner. That owner just raised the rent and the drive-in is on a month to month rental agreement.

The Mearles building is a little worse for wear - maybe shabby chic is the right word, but the classic drive-in still has its loyal fans who don’t want to see the place go away or become some Starbuck’s location.

That’s been a concern to local fans like Annie Silveira who want to keep the place that rivals the Fox as an icon of Visalia. “People would step up to support Mearles if they knew it would make a difference,” says Annie who lives nearby.

Melissa Ward says the big problem Mearles is having is all the new restaurants that have opened in Visalia in the past few years. “That is what is really hurting us,” says Ward. They may not be the only ones.

A slew of well known local eateries have closed, changed hands or are in the process of changing hands this summer in Visalia including some long time favorites like Hagopians, Wagon Wheel Steakhouse, Dharma’s, Mr. Gables, Acequia On Main and El Presidente. In the meantime, perhaps a dozen new restaurants have opened their doors in Visalia mostly on Mooney in the past few years at several shopping centers. Two new national chains are going up this fall - Chili’s and Applebees on south Mooney, with more in the works.

You might remember that Mearles suffered the grease fire that closed the restaurant for almost five months in late 2003 into early 2004. That set back Melissa and company. Ward doesn’t serve up as many of their signature hamburgers anymore - down from a count of about 400 a day to half that on a typical day. She doesn’t want to, but Mearles is having to raise prices just to keep up on costs.

Because of the tough times Ward says she has brought in a silent partner to help her weather these times. Mearles could close some day soon unless Visalia wakes up and returns to the town’s best old-fashion lunch counter. The place is sporting a new menu with some healthier fare or you can settle back and get that big burger and overflowing plate of fries like you really want. Tell ‘m you read about it in the Valley Voice.

---

San Joaquin River Issue Could Be Resolved In Congress Instead Of Courtroom

Tulare County - As the trial date in February nears on the long awaited court battle over the San Joaquin River, perhaps it should not come as a surprise that a high powered attempt to settle the case has surfaced.

At issue is whether the federal government and water contractor Friant Water Authority must release enough water to allow the return of a salmon fishery on the state’s second largest river - a river that also supplies the water to some 15,000 mostly family farmers and one million acres on the eastside of the valley.

The water is critical to our own Tulare County for both irrigation and drinking.

In recent weeks a behind the scenes effort by California Senator Feinstein and Representative Radanovich to forge a federal fix has come out - made public by the National Resources Defense Council (NRDC) the main environmental party to the lawsuit NRDC v. Rodgers. NRDC, apparently concerned the federal initiative would impact the state’s status on California rivers, prompted state Democratic leaders to fire off a letter to Feinstein September 15. Saying that while “we were encouraged to learn recently that you are committed to a settlement only if the parties agree” that the proposed language of the settlement through federal statue would “make serious inroads into the State’s sovereignty over federal water projects on the San Joaquin River systems.” The letter was signed by Democratic leaders Don Perata for the State Senate and Fabian Nunez leader of the Assembly.

Despite the hubbub over the new federal effort, there is a glimmer of hope out there.

Concept Paper

A two page statement concept paper from the federal legislators had been distributed to both NRDC and Friant Water Authority - the real parties in the dispute - early in September. According to the Friant general manager Ron Jacobsma, the concept paper had principles that could be a basis for a settlement from both Friant and NRDC’s points of view. Speaking for Friant was local attorney Dan Dooley.

But Jacobsma says recently NRDC has put up some red flags revealing the private discussions to the press through the state legislators. Still he says the possibility of some movement on the settlement front. “Friant and NRDC are discussing whether these core concepts may be the basis to resolve the SJR issues, potentially via federal legislation. Friant has not committed to any specific commitments of water or any other terms.”

Apparently what is being contemplated is certain language that would be adopted for the coming fiscal year through the Energy and Water Appropriations Act that would codify that the “Bureau of Reclamation would by October 1, 2010 release sufficient flows from Friant Dam (“the Dam”) in order to restore a viable and self-sustaining salmon fishery on the San Joaquin River.”

The concept paper suggested what many studies have found - that modifications to the channel will be needed first to allow the migration of salmon - including channel improvements at Mendota pool, Sack Dam and San Slough Diversion dam and others.

Secondly, a guarantee that at least 100,000 acre feet of water, even in a critically dry year, be released for the salmon fishery, 125,000 acre feet in a dry year, 150,000 acre feet in a normal year, and 200,000 acre feet in a wet year.

To augment the water supply the draft concept paper says Reclamation will develop additional water supplies and at least 150,000 acre feet to be used to make their water releases for the fishery and excess water above that would be divided 50-50 between more water for fish and additional water for the service contracts.

The two page concept paper says costs to be allocated on the basis of “beneficiary pays.”

Jacobsma says in the past few weeks “some numbers have changed” but that both NRDC and Friant are looking hard at the ideas. “We’ll know if this is going to go anywhere in the next few weeks,” says Jacobsma.

The concern by the NRDC and state Democrats appear to be over a state law that mandates that dams must release enough water to maintain healthy fisheries - the law NRDC has prevailed on in federal court that the Bureau and Friant did not comply with. Federal judge Lawrence Karlton has ruled that the US government did not comply with his state law and now will rule on the remedies the government must comply with to satisfy the court.

NRDC may understand that the Karlton ruling will be appealed and this thing will drag on even longer than the 18 years it has already and may be ready to listen to what is arguably the Bay Area’s highest official, Diane Feinstein, to get the restoration process going - something both sides say they want to get to.

Jacobsma says a major hurdle in the restoration decision is how to keep the water in this long valley river from getting too hot during some critical weeks as young salmon are moving upstream. Success in the Toulome River could be a model for what happens to the much larger 150 mile largely flat river where temps can be lethal to young salmon. Re-vegetation is contemplated to cool the river as part of a solution.

---

Visalia Milk Plant To Be A Big One
Salt Limits Tulare’s Milk Future

Visalia - California Dairies - one of the nation’s largest milk cooperatives - plans to transform the former Visalia Frito Lay plant into one of the state’s largest dairy processing plants. CEO for the company, Gary Korsmeier, says the membership of the cooperative - over 700 dairymen strong - voted this past month to invest $124 million to convert the potato chip plant into a milk processing facility that should be ready to receive milk beginning in the Fall of 2007. Korsmeier says the planned butter/powder plant will be able to process as much as 5 million pounds of milk a day.

But the company CEO says a second phase of the plant should follow a year later in 2008/09 when the plant capacity will likely double to 10 million pounds a day, one of the largest plants by volume in the state. The nation’s largest plant is Dairymen’s Land O’Lakes at between 12-13 million pounds a day capacity. The largest cheese plant built in recent years by Cheese Protein International (Land O’Lakes) is rated at 6 million pounds a day as is Leprino’s new plant.

Korsmeier says a key factor in buying the Frito Lay plant is the fact that the “City of Visalia is one of the few cities in the state with available sewer capacity” to discharge dairy processing waste. Visalia’s large capacity is part circumstance and good planning that the town’s largest waste water discharger, the old California Foods olive plant, shut down their operation here a few years ago. In addition the city has made concerted efforts to expand its sewer capacity as an economic development strategy to attract more food industry jobs here.

Korsmeier says the second phase won’t take as long as the first phase because of all the complicated piping and silo work that needs to be done to transform what was a food processing plant making corn and potato chips into a milk byproduct facility will be accomplished.

Korsmeier says the company has more big plans for the 55 acre plant in the future - it could be the co-op’s number one plant - and other food products including cheese might be made here.

In the meantime, the local regional office for California Dairies is moving into the office space in coming months adding about 20 office workers to the 100 plant jobs expected when it opens. Korsmeier says more office jobs will be added in the next few years.

One key strategy for the plant is to increase powder sales for the export market. “We’re selling to Cuba now and Mexico and China” are big customers for the powder that can be fat fortified.

Korsmeier says a second California Dairies plant near Pixley is expanding its capacity right now and the company recently purchased an additional 30 acres next to the plant for ag field discharge of water waste. “We think it’s prudent to make future expansion within a city where there is a sewer system,” says Korsmeier looking to protect itself from a big problem if regulations on open field discharge are tightened up.

Regarding discharge issues, the city of Visalia has a large enough water flow to reduce the volume of salts per gallon compared to the city of Tulare. Salt discharge is the number one problem in faced by processors.

In Tulare the city is under a cease and desist order by the Regional board and has adopted a “carrot/stick” approach to the problem notes city public works director Lew Nelson. “The stick is penalizing companies who discharge high volume of salt into city waste stream and the carrot is a rebate program expected to be in the $2 million range this month to the same companies when they reduce their salt volumes.” Several companies have instituted salt reduction technology to get the city rebates including CPI Inc.

Civil engineer Dennis Keller says food processing companies regularly ship their most concentrated salt waste by truck where high levels don’t matter including the desert, oil fields where it is used for steam injection and even the ocean where salt is not a problem.

Salt limits may put the brakes on any big expansion program for new dairy processors in Tulare however, admits Nelson who is nevertheless celebrating the fact that the city has now met salt levels two years ahead of the Regional Board schedule. Tulare’s big milk processing plants already expand their production on a regular basis as the local milk supply increases by a 4 to 5% clip each year.

By contrast, Visalia’s big population helps dilute the salt content from other sources. Cleaning substances everyone uses and water softeners each add salt to sewer waste that builds up at city treatment plants. Left unchecked, salts can ruin farmland as it has in history time and again.

---

Lemoore Tomato Processor Expanding

Lemoore - SK Foods is undergoing an $8 million expansion this month gearing up for a new, unnamed customer that will push the company to year-round production. “We expect to add about 50 full time jobs,” says the company’s chief operating officer Mark Grewal.

Normally the facility operates mostly in summer months processing about a million tons of area tomatoes for private label customers from their own fields as well as tomato growers on the westside where the valley’s processing tomato crop is centered.

During peak harvest times, the plant and field operations employ nearly 600. That dwindles to a little over 200 during off-peak production times. He says they operate currently about 270 days a year. The plant has been in operation since 1991.

“We’ve grown tenfold since then,” says Grewal, both in production and income.

Grewal says the new customer will mean several new lines of production at the plant in the Lemoore industrial park that makes tomato paste, diced tomatoes, fresh packed tomato and salad products. Much of the crop is grown organically.

The new processing line will use stored product to be put in plastic or glass containers ready for the supermarket or food service business. Part of the plan is to add cold storage for the new line.

Grewal says the company couldn’t have done the expansion without the help of Westlands Water District who is allowing use of land for waste water discharge. He says the City of Lemoore has also been helpful in the expansion.

While the Lemoore plant packs in glass or plastic containers, they send product to a sister plant in Colusa to be canned. SK packs for most of the well known tomato product companies consumers are familiar with.

Last year the company produced 24 million jars of pasta sauce.

In recent years the state’s tomato acreage has moved south such that most of the processing tomato acreage is now in the central valley. Grewal says unlike other vegetables or fresh fruit, actually processing the tomato makes it even better for you to eat. The processing brings out the Licopene and other beneficial ingredients, he says.

The Salyer family of Corcoran founded the company in 1990.

---

What's New

Old Visalia chamber building will be demolished in coming weeks and the site cleared in a musical chairs scenario no one would ever of thought of. Seems as so that the city wants to relocate its Downtown firehouse to the Locust and Court and Noble block and hospital owns most of the land. One small piece is owned by a Presbyterian group - the old Frugalti Black building. The plan is to relocate the old Frugalti Black building to the Mineral Kings site where the religious group plans an office. In turn, that makes the Noble block available for the city's new fire station. City envisions a medical building on the site of the current city hall sometime in the future. The city will swap the hospital for some land later. Clearing the chamber building from the site and bringing in the other building will still leave 25 feet of space alone Mill Creek, says naturalist Brian Kempf, allowing Kempf to write a grant to put in a walking trail on the south side of the creek connecting the trail planned for the entire stretch of Mill Creek into Downtown.

Another huge distribution center - this one at 1.2 million sq ft is considering a Visalia location informed sources say. Construction of the new Vanity Fair warehouse is underway right now at Plaza and Shirk.

FoodsCo is looking at the northwest corner of Lovers Lane and Walnut for a new warehouse market, says informed sources. FoodsCo is owned by Ralphs.

North Mooney will be getting some attention for a change when Auto Zone lands in front of In Shape City. The car parts company will renovate the 7300 sq ft former T-shirt shop, says broker Brian Heron of Prudential Commercial Real Estate. Plans for fast food next to the Auto Zone store are in the works as well. This is the second Auto Zone parts store in town with the other one being on Houston Ave.

Lowes is eyeing a Porterville location once and if Walmart relocates out of their current Henderson store, say real estate sources. Lowes is doing a similar deal in Selma. Walmart's supercenter project will be considered by the Porterville city council next year. Lowes rival, Home Depot, opened in town and Lowes - as they are doing in Tulare - doesn't want to be far behind.

Westland Development has big office plans for the land on both sides of Plaza Dr. off of 198 to construct as much as 35,000 sq ft of leasable or built to suit office space east of the interchange, says Westland Development's Craig Mangano. "We haven't yet submitted to the city but that's what we have planned." The development would require a conditional use permit on land zoned Business Research Park.

Lemoore Chevy dealer - Bob Williams is making a deal with the City of Lemoore to buy 1.14 acres of land adjacent his dealership near 19th Ave. and Highway 198. The City of Lemoore will sell the acreage to Williams at market value ($45,000 per acre) with the expectation the city would make their money in sales tax revenue. Williams wants to add a new unknown car line on the acreage.

Visalia Rotary clubs have formed a steering committee to raise funds for a 2000 seat outdoor multi-use facility to be sited somewhere near the new Civic Center at Oak west of Ben Maddox. The City of Visalia may continue the effort in the way of funding for what is being termed a new "Central Park" in the area.

---

By Miles Shuper

Tulare County - Tulare County residents have responded in a big way in helping the thousands of victim of hurricanes Katrina and Rita.

But, will their generosity take its toll on local charitable and emergency needs?

That question has the Salvation Army, the Tulare County Chapter of the American Red Cross and other groups and organizations pondering the issue as the holiday season fast approaches.

Local Salvation Army leaders say the willingness of area residents to donate to Katrina relief efforts has been outstanding, but they are concerned they might not be able to help as many need families as they hope, especially during Thanksgiving and Christmas.

In the wake of the Sept. 11, 2001, charitable and relief groups experienced a crunch of funds after the tremendous donations due to the disaster.

Tulare Salvation Army Corps Capt. David Scott is concerned that some needy area families might not get the help, especially food baskets, they normally receive during the holiday as a result of the hurricane relief giving.

He said the Tulare corps funding is down about 40 per cent and expects that some programs, especially youth outreach programs may have to be reduced. "These programs, which we feel are the most needed, may have to be trimmed. The cuts have to be made somewhere," he said.. He also is concerned that fewer food baskets given to the needy during the holidays may be provided. Food to fill the baskets is paid for with donations. Scott said toy donations for Christmas will be taken care of and are no reduction in the number of children getting presents. Scott said after 9/11,2001 the local corps had a 30 percent decline in donations.

Funds donated to victims of national disaster relief, are sent from the local corps directly to the nationals organization. Scott said after 9/11, in 2001 the Tulare corps had a 30 percent decline in donations.

In Visalia Capt. Ezekiel Guevara is enthusiastic with the hurricane relief donations but also is concerned about what impact they may have on the holiday giving. He said about $22,000 has been collected so far for the hurricane relief. "I ve never seen such a giving community " noting that donations big and small are coming from all areas. He cited a donation of $11,572, from Kingsburg High School students who raised that money in six hours by circulating donation cans and hosting a barbecue. He said many area schools and organizations have raised funds.

Although he is optimistic about donations during the holiday period, he acknowledges that the Katrina-Rita donations may impact the holiday giving. Last year the Visalia Corps Kettle Drive raised $82,000 and this year's goal has been raised to $100,000 he said.

The Red Cross and Salvation Army are the major vehicles most commonly used for disaster relief efforts. In both cases money specified to go to relief efforts are collected locally and sent to some central location for distribution.

Ken Iiams, executive director of the Tulare County Chapter of the Red Cross said $194,000 has been collected so far in the county for the hurricane relief and money is still coming in.

While that is good news, Iiams is quick to point out that local emergency needs don't stop when a major national or international disaster strikes.

"We still have local fires and disasters. These local people in need are just as devastated from a fire or other event," he said, noting that on the average an area family is left homeless from l a fire every third day. Fortunately, he said, since the hurricanes struck, there have only been two local fires which required immediate housing for families.

"We want to let local donators know we want their help for local needs as well as for the hurricane victims as well." He said.

Like the Salvation Army leaders, Iiams has been impressed with the giving by local residents, businesses as well as schools and other groups.

After last years' hurricanes ravished Florida, local donations topped $80,000 and .

Tsunami donations totaled $225,00, he said.

The needs of victims of major disasters are magnified due to media attention, he said, but a fire or other tragedy leaves local victims "just as devastated and just as much in need as those victims the world sees on television."

---

Visalia - One of the county's oldest hardware stores - Morris Levin & Son of Tulare - are planning a 50,000 sf home improvement store on Lovers Lane in Visalia. Marketing director Brook Killingsworth told the Voice that the company is planning a 5 acre store at the northwest corner of Lovers Lane and Tulare Ave. "We are ready to break ground as long as we get all approval from the City of Visalia," says Killingsworth.

"We've been looking for a place to open in Visalia for some time," she says and it could take a year to 18 months to open the door, he says.

Killingsworth says Morris Levin that dates from 1934 seeks to provide hardware and equipment rental to both the home remodeling market, contractor and traditional ag customers. The company has a store in Porterville as well.

The company offers a complete supply of hardware, rental equipment, small engine parts, plumbing service, air condition sales and sheet metal contracting. Altogether the company now has over 140 employees and continues to be run by a fourth generation of family members. Paul Atas is president of the company today having married into the family and joining the company in 1960.

Killingsworth says the Tulare-based firm feels it can compete quite nicely with their famous big box competitors already open in Visalia, soon to open in both Tulare and Porterville.

---

By Miles Shuper

With the end of the popular "Employee Discount" sales incentives less than a week old, are auto dealers say they are preparing of what appears to be an uncertain market.

While the "Big Three" automakers see a decrease in SUV sales nation-wide and anticipate lower new car sales, area dealers haven't seen a dramatic change in consumer buying trends.

Local dealers are stocking up on newer used vehicles, including SUVs, with their stock of 2005 and 2006 models down due to brisk "employee discount" sales over the months. General Motors, Ford and Chrysler all ended the sales promotions on or near the end of September and the first weekend in October.

Marc Hefner of Will Tiesiera in Tulare, said the incentive programs increased sales locally but said it is "just too early" to tell what will happen in coming months. He said SUV sales still are good, despite the fuel costs. "Families with several kids say they have no choice, they still need a seven passenger vehicle. Hefner said smaller new car dealerships are scrambling to get "newer used cars" so they will have something to sell. He said his company has been getting calls from other dealerships wanting cars from 2003 on up to 2005.. Dealers are eager to buy rental cars from Hertz, Avis and Enterprise who annually switch to the latest models.

John Sappington, general sales manager at Lampe Dodge –Chrysler-Jeep in Tulare said his company recently purchased about 60 of the 2005 models from a national rental company, about twice the number they normally buy. New car dealers are "stocking up" on newer used cars, he said.

Jon Serpa of Serpa Automotive said he has seen some slight changes in market at Serpa noting that potential buyers are finding a variety of choices. He also said that SUVs are still selling, adding that several buyers have said they need them but will try to reduce their amount of driving to off-set the fuel costs.

Nationally the picture is a little clearer.

General Motors and Ford reported shifts away from large SUVs with GM reporting sales down 24 per cent from the previous year and Ford cited a decline of 19 per cent.

In September, U.S. car and light truck sales declined 7.6 per cent.

Daimler Chrysler reported a 4 per cent increase in sales compared to September last year. Chrysler is less dependent on large SUVs, auto analysis noted. Large car sales and the demand for the Dodge Ram pickups were cited as reasons for the sales hike.

While Toyota, the major Japanese automaker, said its U.S. sales jumped 10 percent with demand for the gas-electric Prius high . Sales of the Prius leaped 23 percent,.but Toyota's big SUV, the Sequoia, dropped 47 percent.

The decline in demand for large SUVs is being felt nationwide in the used vehicle sector. Kelly Blue Book s reports prices for used SUV down from January to October. A 2004 GMC Yukon dropped nearly 7 percent to $25,700 during the same period. A 2004 Hummer H2 which was worth $41,700 in January is worth $39,000 now.

Figures show a 2004 Ford Expedition dropped nearly 10 percent to $22,200.

Local dealers agree that used car buyers can save some money due to the amount of used vehicles in stock as the result of the discounts on new vehicles. According to officials from the National Automotive Dealers Association, prices are about 5 per cent lower.

Jon Serpa said buyers can save up to $1,000 due to the high used car inventory from trade-ins.

With used car totals climbing, sellers can expect to get less for their vehicles, auto dealers and industry experts agree.

---

Return to Archive