1. 12/5/20151 Coachella Valley 2010 Now What? John Husing, Ph.D. Economics & Politics, Inc.

2. After Losing 8.36 Million Jobs … U.S. Job Creation Is Crawling Back

3. ! Consumers Confidence Decaying Again! 100.0 = Normal

4. 12/5/20154 So. CA Job Change, 1991-2010e -488,700 -886,849 -10.0%

5. 12/5/20155 Inland Empire Job Change, 1984-2010e +20,600 -168,577 -13.1%

6. 12/5/20156 Coachella Valley, Job Changes 1,879 14,121 -10.1%

7. 12/5/20157 Worst National Unemployment Rates

8. 12/5/20158 “ ” not U or V Shape of Recovery?

9. 12/5/20159 What About the Future? … Look At The Economic Base

10. Gold Mine Theory Primary Tier Secondary Tier

11. Economic Base 12/5/201511 Construction Hotels & Conventions Tourism Tourist Shoppers Agriculture Clean Tech Creative Arts Distribution Retirees Health Care Manufacturing

12. 12/5/201512 Existing Homes Sales Headed For A Record in 2010 … Thanks To Short Sales/ Foreclosures 7.3%

13. New Homes Sales Headed For A Record in 2010 … Thanks To Short Sales/ Foreclosures 12/5/201513

14. 12/5/201514 Existing Home Price Rebound To 2003 Level 30.5%

15. 12/5/201515 New Home Price Back To 2000-2002 Level … Just Above Existing Homes

16. 12/5/201516 Coachella Valley Housing Permits At Modern Low … Can’t Build At These Prices

17. 12/5/201517 42,60743.7% 42,607 Traded 2004-7 of 97,471 Total (43.7%) 31,995 31,995 Drained Equity 74,562 76.5% 74,562 Problem Homes of 97,471 Total (76.5%) 46.6% County Average Notices of Default 46.6% County Average Notices of Default 34,746 Notices of Default Filed (estimate) 39,816 Where Are They? Supply: Upside Down Homes

18. Somebody Has To Take A Major Hit! Homeowners Lose Their Homes Lenders Lose Part of Their Investments Mortgage Backed Security Owners Lose Part of Their Investments Taxpayers Subsidize One of the Above Until This Happens … We Don’t Have A Recovery!

19. 12/5/201519 Isn’t There Any Good News? Yes!

20. 12/5/201520 Supply & Demand Demand From Lower Prices Supply From Foreclosures vs.

21. Price Stability? Riverside Co.San Bernardino Co. May$180,000 $137,000 June$185,0002.80%$140,0002.20% July$185,0002.80%$140,0002.20% August$190,0005.60%$145,0005.80% Sept.$183,0001.70%$150,0009.50% Oct.$190,0005.60%$150,0009.50% Nov.$200,00011.10%$160,00016.80% Dec.$196,0008.90%$154,00012.40% Jan-10$195,0008.30%$150,0009.50% Feb.$190,0005.60%$144,0005.10% Mar.$198,00010.00%$152,00010.90% Apr.$195,0008.30%$150,0009.50% May$210,00016.70%$160,00016.80% June$210,00016.70%$160,00016.80% July$200,00011.10%$155,00013.10% August$200,00011.10%$158,00015.30% Sept.$200,00011.10%$160,00016.80%

22. Assessed Valuation UP … Next Move Is UP!

23. 12/5/201523 Demand Soaring CV Housing Affordability Sets A Record & Drives Demand 62% 10% 53% 55%

24. Competitive Housing Prices 12/5/201524

25. DoneConstTotal Palm Springs-Cath. Cty, DHSprgs.170 Rancho Mirage8715 Palm Desert62127 Indian Wells-La Quinta7533108 Indio-Coachella1731 48 12392215 12/5/2015 Limited New Home Supply, 2 nd -2010

26. Economic Base 12/5/201526 ConstructionD- Hotels & Conventions Tourism Tourist Shoppers Agriculture Clean Tech Creative Arts Distribution Retirees Health Care Manufacturing

27. Hotel Rates, A Weak Pulse 12/5/201527 Corporate Meetings & Conventions Still Missing

28. Airport Volume Increasing 12/5/201528 Wishing For More Flights Like Phoenix-Scottsdale

29. Car Rental Activity On & Near Airport 12/5/201529 Tourists … Not Business Travelers?

30. 12/5/201530 Transit Occupancy Tax: Palm Springs 12.7% -1.1% -0.4% -11.9% 4.8% 21.6% 13,024,611 14,677,511 14,521,402 14,466,704 12,751,478 13,367,685 FY 05FY 06FY 07FY 08FY 09FY 10FY 11 July/Aug. Note: FY 2011 Based On July-August 2009-2010 Source: City of Palm Springs Transit Occupancy Tax Palm Springs, FY 2005 to FY 2011 ytd Cold Weather In So. California Helped!

31. Increased Tourist Options: Possible Thermal Motor Sports Park 12/5/201531

32. Retail Sales … Finally Some Life 12/5/201532

33. 12/5/201533 Retail Sales By City

34. Economic Base 12/5/201534 ConstructionD- Hotels & ConventionsD- TourismC+ Tourist ShoppersC- Agriculture Clean Tech Creative Arts Distribution Retirees Health Care Manufacturing

35. High Value Crops 12/5/201535

36. Agricultural Production 12/5/201536 When Construction Recovers … Will Need The “AgJobs” Temporary Visa Program

37. Economic Base 12/5/201537 ConstructionD- Hotels & ConventionsD- TourismC+ Tourist ShoppersC- AgricultureB Clean Tech Creative Arts Distribution Health Care Retirees Manufacturing

38. Clean Energy Initiatives 12/5/201538 Demand Property Assessed Clean Energy Financing (PACE) Palm Desert Municipal Program AB 811 Net Metering Development Skill Training To Work In the Industry Electric Vehicle Production

39. Economic Base 12/5/201539 ConstructionD- Hotels & ConventionsD TourismC+ Tourist ShoppersC- AgricultureB Clean TechC+ Creative Arts Distribution Health Care Retirees Manufacturing

40. Creative Arts 12/5/201540

41. Major Films & Important Commercials Are Already Shot in the Coachella Valley 12/5/201541 Value of Filming Activity Coachella Valley Coachella ValleyRiverside Co.Share 2006$11,892,591$24,225,50049.1% 2007$10,174,750$15,336,75066.3% 2008$11,705,000$13,551,00086.4% 2009$4,732,000$9,639,20049.1% 2006-2006$38,504,341$62,752,45061.4% Assumes Coachella Valley equal to lowest share of 2007-2009 Source: Inland Empire Film Commission

42. Opportunities Exist: 12/5/201542 Coachella Valley Has Always Been A Hollywood Playground Films & Commercials Are Already Shot In the Valley Major Venues Already Require Skilled Technicians Major Entertainment & Film Related Events Already Take Place Relationships With Key Arts & Entertainment Leaders Already Exist Its Time To Take The Next Step & Seriously Become A Center For the Creative Arts

43. Economic Base 12/5/201543 ConstructionD- Hotels & ConventionsD TourismC+ Tourist ShoppersC- AgricultureB Clean TechC+ Creative ArtsB- Distribution Health Care Retirees Manufacturing

44. Logistics Links 12/5/201544

45. Key Transportation Links 12/5/201545 To East To Mexico To East & Mexico

46. Distribution 12/5/201546

47. Economic Base 12/5/201547 ConstructionD- Hotels & ConventionsD TourismC+ Tourist ShoppersC- AgricultureB Clean TechC+ Creative ArtsB- DistributionC+ Health Care Retirees Manufacturing

48. Facilities & Medical Staff 12/5/201548

49. Health Care Employment 12/5/201549

50. Age Distribution 12/5/201550

51. Economic Base 12/5/201551 ConstructionD- Hotels & ConventionsD TourismC+ Tourist ShoppersC- AgricultureB Clean TechC+ Creative ArtsB- DistributionC+ Health CareA- Retirees Manufacturing

52. Is the Past … the Future? 12/5/201552

53. Active Baby Boomer Retirees 12/5/201553 Now This No Longer Just This

54. Economic Base 12/5/201554 ConstructionD- Hotels & ConventionsD TourismC+ Tourist ShoppersC- AgricultureB Clean TechC+ Creative ArtsB- DistributionC+ Health CareA- RetireesA Manufacturing

55. Manufacturing Jobs Back Below 1997 Level 12/5/201555

56. Setting Conditions For The Future 12/5/201556 ConstructionD- Hotels & ConventionsD TourismC+ Tourist ShoppersC- AgricultureB Clean TechC+ Creative ArtsB- DistributionC+ Health CareA- RetireesA ManufacturingD- Over All Grade C-

57. Other Key Current Facts … 12/5/201557

58. 12/5/201558 Growth Has Slowed

59. 12/5/201559 Academic Performance

60. 12/5/201560 Adult Educational Level Economic Target: Educational Performance

61. 12/5/201561 What Jobs Grew?

62. 12/5/201562 Largest Employers

63. 12/5/201563 Payroll Released Into Valley

64. 12/5/201564 Crime Per 1,000 Residents

65. 12/5/201565 2010, 2011 When Will “Normal” Start To Return? x 2012 If Mortgages Fixed! x x 2014-2015 Not

66. 12/5/201566 www.johnhusing.com