W H E R E W E G O F R O M H E R E .

Compiled for the Coachella Valley Economic Partnership by John E. Husing, Ph.D., Economics & Politics, Inc.

C O A C H E L L A VA L L E Y E C O N O M I C R E P O R T, 2 0 0 7

W H E R E W E A R E T O D AY.

Dear CVEP Members and Guests:

It is my pleasure to welcome you to the second annual Coachella Valley Economic

Outlook Conference brought to you by the Coachella Valley Economic Partnership.

We have an excellent lineup of presentations set for today’s event, so get ready for a

lot of valuable information and insights about the local economy from the top

experts. By attending this event, you will get the best snapshot available of what has

been happening in our regional economy and forecasts for where it is headed.

As we consider the opportunities and challenges ahead at this wonderful event, I

want to give my sincere thanks to CVEP’s staff and volunteers for the great work they

have done during the past year. During the year we made what I have often referred

to as the ultimate organizational sacrifice by loaning and then relinquishing our

former CEO, Rick Daniels, to the Salton Sea Authority. The arrangement was urgently

needed to support one of our most important initiatives – the effort to seek restoration

of the Sea using a locally preferred alternative.

Last year was a period when our membership continued to grow. Welcome to all of the

new members. I invite all of you to join one of CVEP’s committees, attend our regular

and special meetings and get involved as we take things to the next level this year.

We also had great success this past year in expanding our exceptional Career

Pathways Initiative through a new major grant from Desert Healthcare District that

enabled us to fund the Healthcare Industry Council, which is off to a very active

start. Through the hard work of Kim McNulty and her team, the Initiative is gaining

a reputation as a model program for the entire state of California and beyond.

Finally, I am excited that we have John Soulliere on board as our recently hired

President and CEO. He hit the ground running from day one and has already made

a significant impact on the organization in a short time.

Sincerely,

Robert W. Marra

Chairman of the Board

2

3

S P O N S O R ST O P I C PA G E

A Letter from Bob Marra, Chairman of the Board 1

Executive Committee 2006-2007 and 2007-2008 4

A Message from John Soulliere, CEO 6

Coachella Valley Economy: Brief Analysis 13

Exhibit List 19

Demographics 22

Employment 28

Housing 38

Taxable Sales 44

Banking 48

Assessed Valuation 52

Crime Rates 56

Education 60

Colleges and Universities 62

Appendix (Employment & Payroll Detailed Tables) 64

A D D I T I O N A L S P O N S O R S

ORR BUILDERS • SOUTHERN CALIFORNIA EDISON • VERIZON FOUNDATION

City of Cathedral City • City of Coachella • City of Desert Hot Springs • City of Indian WellsCity of Indio • City of La Quinta • City of Palm Desert • City of Palm Springs • Town of Yucca Valley

Coachella Valley Report, 2007

TA B L E O F C O N T E N T S

4

2006-2007

Thank you to the following individuals and the organizations they represent, for their

dedication and commitment to CVEP this past year:

Chairman of the Board: Bob Marra, Wheeler’s Market Intelligence

Immediate Past Chairman: Paul Magana, Union Bank of California

Vice Chairperson: Patrick Swarthout, The Gas Company

Secretary: Michelle Krans, The Desert Sun

Treasurer/Class A Member: Mark Weber, IID Energy

Member-at-Large: Lee Morcus, Kaiser Restaurant Group

Member-at-Large: Bill Powers, Pacific Western Bank

Member-at-Large: Dick Oliphant, Oliphant Enterprises

Member-at-Large: Tom Davis, Agua Caliente Band of Cahuilla Indians

Public: Rob Bernheimer, City of Indian Wells

Public: Jim Ferguson, City of Palm Desert

2007-2008

For the 2007/2008 year, we welcome the following individuals and the organizations they

represent, and look forward to their assisting CVEP with its mission to assist in building

a prosperous Coachella Valley for the coming generations:

Chairman: Jim Ferguson, Ferguson Law Firm

Immediate Past Chair: Bob Marra, Wheeler’s Market Intellegence

Vice Chairperson: Michelle Krans, The Desert Sun

Secretary: Kevin McGuire, PDNB

Treasurer: Aubry Serfling, Eisenhower Medical Center

Member-at-Large: Ben Scholten, Rabobank

Member-at-Large: Lee Morcus, Kaiser Restaurant Group

Member-at-Large: Steve Pougnet

Member-at-Large: Kathy DeRosa, City of Cathedral City

Public (West): Agua Calliente Band of Cahuilla Indians

Public (East): City of La Quinta

Coachella Valley Economic Partnership

E X E C U T I V E C O M M I T T E E

5

W H E R E W E A R E . W H E R E W E G O F R O M H E R E .

The theme of the 2007 Coachella Valley Economic Partnership Forecast

event — Where we are today... where we go from here — suggests a time of

introspection, evaluation and planning. Consider what the valley might become

by the year 2025. Consider the economic changes that are occurring globally,

nationally and within our region and how we should respond to them.

Consider, too, the great opportunity we have today as leaders to chart a

course that will lead our valley to a desirable destination.

A M E S S A G E F R O M J O H N S O U L L I E R E , C E O

8

Regional growth statistics indicate that

though it comes in cycles, growth most

certainly will continue to come. Pressure

from the west along with an insatiable

appetite for our desert environment will

only increase in coming years. The question

then is not “Will we grow?” but “How will

we ensure we grow into what we want to

be?” Today, through regional collaboration

and planning, we can seize the opportunity

of the changing marketplace to answer that

question. In doing so, we will discover the

awesome potential we have to build a

prosperous Coachella Valley for the

coming generations.

The Coachella Valley possesses the right

mix of amenities to become a center for

new and emerging industries. The key to

those new markets such as “cleantech,”

alternative energy research and develop-

ment, and numerous other sectors is the

triangular relationship between higher

education, private industry and local

government. Within the Coachella Valley

Economic Partnership (CVEP), this most

critical alliance exists today.

As we continue to unify in purpose, we

will become more effective in reaching

into the global marketplace to capture our

share of the emerging economy. It is

through a unified front that our valley as a

whole must be presented to be recognized

as a superior business destination that is

not only business-capable, but also includes

a coveted resort lifestyle.

The Coachella Valley and CVEP are at the

same exciting crossroad. We are not only

enjoying the return on investment from

the efforts of the past years, we are poised

to make the shift towards bringing balance

to our regional economy. This balanced

economy will create greater levels of

economic stability, higher paying jobs,

provide greater opportunity to our children,

and attract intellectual capital — “the

creative class” — to the region.

Through CVEP’s innovative Career Pathways

Initiative (CPI) we have set the mark and

received state-wide recognition for bridging

the gap between education and industry.

Our partnership with the regional K

through 12 institutions, our community

college network and our university systems,

is serving to cultivate the kind of young

talent that the global marketplace is search-

ing for. In the coming year the CPI team

will be working closely with the regional

utility providers and the county’s workforce

development team to fill the void of the

retiring “boomer” generation with a skilled

labor force. Our message to the world is

that we have the business environment, the

lifestyle and the talent right here in the

Coachella Valley.

I am a bit awe struck when I consider the

foresight of those great and visionary

minds who looked over the horizon back

in 1994 and saw what the Coachella Valley

would need to compete in the global mar-

ketplace in the decades that would follow.

They knew that the region, not a single

jurisdiction, represented a true business

destination. They saw that collaboratively

— from the western mountain pass to the

Salton Sea — the Coachella Valley pos-

sessed all of the necessary components to

complete the package for the kind of eco-

nomic growth our future generations

would need. They did their part and have

passed the torch on to us, the CVEP of 2007.

Our task is not to reinvent the vision, but

to have the courage to implement it.

Through our unified partnership, the

Coachella Valley will compete and win in

the global economic arena. This is the

vision of CVEP. We are business-capable

in every way with a resort lifestyle found

nowhere else in the world.

As we proceed through inevitable periods

of change and challenges, I thank you, our

investors, for your consistent support of

CVEP. I also thank the members of the

Executive Committee for their service and

leadership over the past year. Your con-

tinued involvement with your mind in

addition to your money is essential to

our success. The plans we develop and

implement together will make the differ-

ence in the years to come.

John Soulliere

9

The question then is not “Will we grow?” but “How

will we ensure we grow into what we want to be?”

10

11

12

E C O N O M I C R E P O R T

14

This is the case for five reasons:

n The area is a national destination for

tourists and conventions plus people with

seasonal second homes. As the flow of

these people to the Coachella Valley is

heavily dependent upon U.S. discretionary

income, the Coachella Valley’s economy

has tended to have an exaggerated business

cycle: soaring in good times and plunging

in bad times.

n The region has grown up as an important

Southern California and national retirement

center. As a result, an important portion of

its economy is devoted to providing serv-

ices to an aging population. This is seen in

its health care industry as well as its retail,

restaurant and entertainment (including golf

courses and tennis clubs) sectors. With the

first of the baby boomer generation now at

60 years old, residential construction has

been added as a major economic force.

Meanwhile, the number of full time resi-

dents of the area is growing as retirees,

many from Southern California, make the

decision to migrate to the valley.

n The expanding frontier of Southern

California’s urban economy has not yet

reached the valley. Thus, the jobs within

the region tend to be filled by local residents

while relatively few local residents tend to

be commuters to jobs outside of it. This fact

means that the economy can be thought of

as one that ebbs and flows according to the

extent to which dollars flow into it from

any location outside of it. That isolation will

likely breakdown now that the edge of the

urban region is in Beaumont and heading

east along the I-10 freeway.

n An economy that evolves based upon

providing services to tourists, conventions,

seasonal second homeowners and a

growing base of retirees is one in which a

significant share of the job base is in retail-

ing, consumer services, hotels, amusement

and construction. The skills required to

work in these sectors often do not require

well-educated workers. The major excep-

tion to this fact is the valley’s large health

care field.

n The Coachella Valley’s agricultural

heritage has meant that, historically, a

significant blue collar population has

always lived in it. Though agriculture is

now less of a growth force, many people

from these families now constitute a sig-

nificant share of the local labor force. This

working population has tended to live in

Indio, Coachella, Desert Hot Springs and

Cathedral City, while their jobs have often

been in the other five cities. Though recent

housing trends have tended to break down

some of this separation, the valley still has

a significant division between cities with

high income people needing services and

cities with modest income residents who

provide them.

These facts about the economic life of the

Coachella Valley, today, present the area

with its important economic challenges:

n How to broaden the economy away from

the exaggerated influence of the ebbs and

flows of U.S. discretionary income to even

out the levels of its peaks and valleys.

n How to plan for an economy with a much

larger full-time retirement population and

use that emerging trend to help stabilize

the valley’s ebbs and flows.

Coachella Valley Economy: B R I E F A N A LY S I S

John E. Husing, Ph.D.

Fundamentally, the data in this report show that

the Coachella Valley’s economy can still be thought

of as a relatively isolated economy operating

according to dynamics that, while related to the

Inland Empire and Southern California, have

distinctive rhythms and aspects.

15

n How to take advantage of the migra-

tion of the edge of urbanized Southern

California into the portions of the valley

closest to San Gorgonio Pass to help diver-

sify the economy.

n How to develop industries that will

employ well-educated and higher paid

workers and help raise the incomes of

local workers.

n How to raise the educational aspirations

and achievement of the region’s school

children as well as its adult workforce, given

that higher paying jobs tend to require

greater levels of education and/or skill.

Dealing with these broad issues requires

the development and execution of economic

strategies. This has become the essential

mission of the Coachella Valley Economic

Partnership. Some comments on the

directions which their work can and/or

is taking are thus in order:

n Certainly, the valley will continue to

welcome the influx of spending by national

tourists, conventions and seasonal residents.

These outside flows of dollars are a key

portion of the region’s prosperity, because

as this money changes hands locally, it has

a multiplied impact on the area’s economy.

The issue is not how to lower these flows

of outside funds, but rather to broaden

the economy with other sources of funds

that are not subject to the seasonal and

national business cycle fluctuations

inherent in an economy heavily based on

this form of spending.

n One way to broaden and stabilize the

Coachella Valley’s economy is being natural-

ly presented to it by the aging of the baby

boomer population. Already, numerous

members of this generation are beginning

to eye the valley as their full-time retire-

ment home. Many of the couples making

these decisions are Southern Californians

and are not afraid of the heat that impacts

desert areas in the summer. Their retire-

ment incomes will provide the region

with a year-around source of outside dol-

lars that will serve to blunt the Coachella

Valley’s seasonal cycle. And, as pension

incomes are relatively stable, they will also

have the desired impact of blunting the

ebbs and flows that hit the local economy

when the U.S. economy goes through its

business cycles. In effect, this flow of

retirees is a trend that should be encour-

aged by the valley’s leaders.

n Like it or not, the edge of urban Southern

California is now quite close to the

Coachella Valley. The outward migration of

residential construction for a commuter

population has now reached Beaumont

along the I-10 freeway. While this building

cycle appears to be coming to an end, the

shortage of housing in Southern California

makes the next up-tick inevitable. When

it occurs, Banning will be the next city

caught up in a building boom followed by

north Palm Springs and Desert Hot

Springs. This will put added pressure on

the valley’s I-10 linkage to the balance of

Southern California as many of these new

residents will be commuters. This pattern

has already emerged in the Victor Valley

and its issues can be instructive for leaders

in the Coachella Valley. The incomes

brought home by these commuters will

have a stabilizing impact on the region’s

economy as they will ebb and flow with

Southern California’s economy which often

has been more stable than the national

economy (exception: aerospace/defense

bust at the end of the Cold War).

n Meanwhile, the disappearance of indus-

trial land in the urbanized portion of the

Inland Empire, combined with the rapid

rise of imports through the ports of Los

Angeles and Long Beach will likely open a

new source of jobs in the Coachella Valley

in the next decade. These will be in the

logistics sector. Already, 41.5% of all con-

tainers entering the country pass through

Southern California’s ports. There is a cry-

ing need for facilities where the goods in

these containers can be unloaded,

stored, managed and shipped as needed.

The Coachella Valley is the next place

along the I-10 truck route and UP

Railroad mainline that will be asked by

the development community to host

these facilities once the San Bernardino-

Redlands area runs out of room. Already,

large buildings are going up in San Gorgonio

Pass and UP Railroad is apparently seeking

a site for a new intermodal yard along its

mainline, a key piece of logistics infra-

structure since it is where containers move

between trucks and trains.

As the data following shows, distribution

is the blue collar sector that pays more

than either construction or manufacturing,

both in the Coachella Valley and in

Southern California. It can thus serve to

provide a source of higher pay to workers

who lack higher education and need a

career path via on-the-job learning to

reach the middle class. It is also a sector

that can broaden the valley’s economy and

make it less dependent upon the flow of

funds that are seasonal or follow the U.S.

business cycle. However, this sector brings

important issues. It will put pressure on the

I-10 freeway. Unless its air quality issues

16

are addressed, it will impact the levels of

diesel emissions. For the Coachella Valley,

it will also provide higher wage competi-

tion for the kinds of workers now earning

less in the consumer service sectors. Like

commuter-based residents, the flow of this

activity into the valley is likely inevitable

and leaders need to be planning for it.

n Another way to raise the incomes of

workers in the Coachella Valley is to

attempt to stimulate sectors that pay better.

The Coachella Valley Economic Partnership

has targeted five such parts of the economy:

health care, multi-media, advanced tech-

nology, education and recreation.

• The health care sector is a natural for

the valley since it is already a well-

defined cluster including hospitals, out-

patient care, rehabilitation, dentists and

related work. In addition, the valley has

a national reputation in these areas.

What is lacking is a labor force that can

keep up with the expansion of the sector,

given the educational and skill levels

needed to work within it. In addition,

the maturity of the sector plus the antic-

ipated growth in base of local full-time

retirees, opens the possibility of research

and development on techniques and

products needed by what will be a grow-

ing segment of America’s population.

• The multi-media cluster is another

natural for the valley. Traditionally, it has

been home to the stars of radio, televi-

sion and the cinema. It is often the

location for major production shoots.

There are annual film and music festivals

that are growing in industry recognition.

Today, many of the technicians and

artists who operate within the sector

are relocating to the area. This gives the

region a base of activity and knowledge

from which to build. In addition, in the

virtual world, many of the activities that

can drive this sector can be located any-

where. Here, an example is the remote

location of George Lucas’s Industrial

Light and Magic in Marin County.

• One just has to drive by the windmill

farms at the entrance to the Coachella

Valley or read about the solar energy

farms in Southern California’s deserts to

realize that alternative energy produc-

tion is already showing up in these

areas. In addition, as a desert region,

the valley has long had to be aware of

the need for advanced water technology,

a fact now heightened by the need to

preserve the Salton Sea. With petroleum

prices soaring, global warming and

energy independence emerging as issues,

plus population straining our water and

electrical resources, there is and will be

a rising worldwide demand for alterna-

tive energy and water solutions. Again,

the valley has an important base of

knowledge and activity from which to

develop these sectors.

• There is no such thing as a poor,

well-educated region. It is unfortunate

that the opposite is also true. That is

why CVEP’s economic development

strategy seeks to tackle the relatively

low educational level of the area’s adult

workforce as well as the marginal per-

formance of too many of its school

children. Strategies for doing so must

be partially driven from the business

community, given its increasing under-

standing of the types of workers it will

need. In addition, the development of

the strategies just mentioned has also

involved the framing of educational

strategies as they cannot succeed with-

out them. Similarly, the expansion of

the logistics will require local access to

workforce training.

A good sign is the fact that test scores

in the area have been rising in all three

local school districts, with particular

success in the Desert Sands district.

Meanwhile, each of the three districts

are in various stages of adding facili-

ties and a new Catholic high school is

functioning today as a college prep

school. Noteworthy is the interest and

willingness of College of the Desert to

17

participate in working to increase the

skills of the adult workforce. The cam-

pus is expanding at its current site and

at two additional locations.

Ultimately, the expansion of the Cal State

San Bernardino campus as well as UCR’s

nearby Richard Heckmann International

Center for Entrepreneurial Management

will also be of great significance in help-

ing the Coachella Valley both hold its

best students and boost its economy.

This year, Cal State will break ground

on its third building, a Health Sciences

facility. It will provide training in one

of CVEP’s key target sectors. In addi-

tion, UCR has launched an MBA pro-

gram plus an MFA in Screenwriting.

The second of these will be on point to

another of CVEP’s targeted sectors. UCR

campus is also assisting in the forma-

tion of an Angel Network to assist

entrepreneurs in gaining start up and

second stage funding.

• Recreation is CVEP’s other targeted

sector. This is in keeping with the

Coachella Valley’s obvious strength in

serving retirees, tourists, convention-

eers and others wanting to enjoy golf,

tennis, gaming, biking and hiking, as

well as rock climbing in nearby Joshua

Tree National Park. This sector already

brings huge amounts of tourists dollars

to the region. The Indian gaming sec-

tor has added a new element that pays

above average for its sector group.

Affiliated with these activities is the

possibility for expanded design and

manufacturing of the equipment asso-

ciated with these activities such as the

alternative energy vehicles related to

golf carts and the specialized equip-

ment used in rock climbing.

Today, the Coachella Valley has an economy

that has become increasingly prosperous.

However, it is one that is still overly vul-

nerable to seasonal and national cyclical

fluctuations and the valley still has a

disproportionately large share of its

work concentrated in modest paying

sectors. However, conditions are devel-

oping in ways that could well allow the

region’s leaders to improve upon both of

these situations.

Today, the Coachella

Valley has an economy

that has become

increasingly prosperous.

However, it is one that

is still overly vulnerable

to seasonal and

national cyclical

fluctuations...

18

The unified front that presents the Coachella Valley

as a superior destination that is business-capable

and offers a coveted resort lifestyle.

It’s where we go from here.

Coachella Valley Economic Partnership

73-710 Fred Waring Drive, Suite 106

Palm Desert, California 92260

Phone: 760.340.1575 or 1.800.596.1007

Fax: 760.340.9212

www.cvep.com

19

N U M B E R T O P I C PA G E

D E M O G R A P H I C S

1 Population Growth, Coachella Valley, 1990-2007 22

2 Population Growth Rates, Coachella Valley & Other Major Areas, 2000-2007 23

3 Population By City, Coachella Valley Communities, 2007 23

4 Population Growth By City, Coachella Valley Communities, 2000-2007 23

5 Age Distribution, Number, Coachella Valley, 2006 24

6 Ethnic Change, Coachella Valley & Riverside County, 2000-2006 24

7 Ethnic Composition, Coachella Valley Cities, 2006 25

8 Income Estimates, Coachella Valley & Inland Empire, 2006 25

9 Median Income By City, Coachella Valley, 2006 26

10 Total Income By City, Coachella Valley, 2006 26

E M P L O Y M E N T

11 Employment, Coachella Valley, 1991-2006 28

12 Employment Gain By Sector, Coachella Valley, 1991-2006 28

13 Employment Growth Rates, Coachella Valley & Inland Empire, 1991-2006 29

14 Employment Distribution By Sector, Coachella Valley, 2006 30

15 Employment Distribution By Sector, Coachella Valley, 1991 30

16 Payroll, Coachella Valley, 1991-2006 30

17 Payroll Growth, Allowing for Inflation Coachella Valley, 1991-2006 31

18 Payroll Gain By Sector, Coachella Valley, 1991-2006 32

19 Payroll Per Job, Coachella Valley, 1991-2006 32

20 Growth in Average Pay Per Job, Coachella Valley, 1991-2006 33

21 Average Pay Per Job By Sector, Coachella Valley, 2006 33

22 Number of Firms, Coachella Valley, 1991-2006 34

23 Growth in Number of Firms By Sector, Coachella Valley, 1991-2006 34

24 Distribution of Firms By Sector, Coachella Valley, 2006 35

25 Average Workers per Firm, Coachella Valley, 1991-2006 35

26 Employment of Residents, By Sector, Coachella Valley, 2006 36

27 Employment of Residents, by Occupation, Coachella Valley & Inland Empire, 2000 36

H O U S I N G

28 Existing Home Sales, Coachella Valley, Annual, 1998-2006 38

29 Existing Home Sales, Coachella Valley Cities, 2006 38

30 New Home Sales, Coachella Valley, Annual, 1988-2006 39

31 New Home Sales, Coachella Valley Cities, 2006 39

32 Existing Home Price Trend, Coachella Valley, 1998-2007 2nd Qtr. 40

33 Existing Home Price Prices, 2007 2nd Qtr., Coachella Valley & So. Calif. Counties 41

34 New Home Price Trend, Coachella Valley, 1988-2007 2nd Qtr. 42

35 New Home Price Prices, 2007 2nd Qtr., Coachella Valley & So. Calif. Counties 43

36 Apartment Rental Rate, High Grade Units, Inland Empire Markets & Coastal Counties, 2007 43

Coachella Valley Report, 2007Exhibit List

20

N U M B E R T O P I C PA G E

TA X A B L E S A L E S

37 Taxable Retail Sales, Coachella Valley, 1990-2006 44

38 Taxable Sales Growth, Coachella Valley vs. Inland Empire, 1990-2006 44

39 Retail Sales By City, Coachella Valley, 2006 45

40 Retail Sales Growth & Growth Rates, By City, Coachella Valley, 2005-2006 45

41 Retail Sales Per Capita, Coachella Valley & Inland Empire, 1990-2006 45

42 Retail Sales Per Capita, Coachella Valley & Major Inland Cities, 2006 46

43 Retail Trade by Sector, Coachella Valley, 2006 46

B A N K I N G

44 Bank Deposits, Coachella Valley, 1992-2006 48

45 Bank Deposits by City, Coachella Valley Cities & Highest Inland Cities, 2006 48

46 Per Capita Bank Deposits, Coachella Valley, 1992-2006 49

47 Per Capita Bank Deposits, Coachella Valley Cities & Highest Inland Cities, 2006 49

48 Bank Deposits By Bank, Coachella Valley, 2006 50

A S S E S S E D VA L U AT I O N

49 Assessed Valuation, Coachella Valley Cities, 1990-2007 52

50 Assessed Valuation Growth, Coachella Valley & Riverside County, 1990-2007 52

5 1 Assessed Valuation by City, Coachella Valley, Fiscal year 2007-2007 53

52 Per Capita Assessed Valuation, Coachella Valley, 1990-2007 53

53 Assessed Valuation Per Capita, Riverside County Cities, FY 2007-2008 54

C R I M E R AT E S

54 Reported Crime Rate Per 1,000 Residents, Coachella Valley, 1994-2005 56

55 Total Crime Report per 1,000 Residents, Coachella Valley Cities, 2005 57

56 Violent Crime Reported Per 1,000 Residents, Coachella Valley Cities, 2005 57

57 Property Crime Reported Per 1,000 Residents, Coachella Valley Cities, 2005 58

58 Types of Crime Reported, Coachella Valley Cities, 2005 59

E D U C AT I O N

59 Academic Performance Index, All Schools, Coachella Valley School Districts, 2007 60

60 High School Exit Examination, Riverside County High School Districts, 10th Grade, 2007 61

6 1 Scholastic Assessment Test Scores, Major Riverside County High School Districts, 2006 61

Colleges & Universities 62

A P P E N D I X : E M P L O Y M E N T & PAY R O L L D E TA I L S

62 Employment By Sector, Coachella Valley, 1991-2006 64

63 Payroll By Sector, Coachella Valley, 1991-2006 65

64 Average Pay Per Job, Coachella Valley, By Sector, 1991-2006 67

21

22

n From 1990-2007, the Coachella Valley’s

population grew from 230,865 to 408,624.

That was a gain of 177,789 in sixteen years

(77.0%) and 99,094 (32.0%) since 2000

(Exhibit 1).

D E M O G R A P H I C S

23

n In 2007, the Coachella Valley’s cities

ranged in size from Indio with 77,146

people to Indian Wells with 4,842. Three

additional cities had over 45,000 people:

Cathedral City (52,115), Palm Desert

(49,752) and Palm Springs (46,858)

(Exhibit 3).

n From 2000-2007, Indio’s growth led the

Coachella Valley, up by 22,538 people

(Exhibit 4). La Quinta was second, up

14,646, followed by Coachella (12,483),

Cathedral City (8,434) and Palm Desert

(8,384). The importance of land availability

was reflected in the growth of the first

three of these communities. The fewest

people were added by Desert Hot Springs

(5,429), Palm Springs (3,632), Rancho

Mirage (3,423) and Indian Wells (1,049).

n The Coachella Valley’s 32.0% increase in

population from 2000-2007 was much

faster than the surrounding Inland Empire

(25.3%), California (11.2%) or the U.S.

(7.7%) (Exhibit 2).

24

n The Census Bureau’s 2006 American

Community survey found that the

Coachella Valley’s largest population

groups were young adults aged 25-34

(54,601; 14.1%) and children 10-19 (51,786;

13.4%). For the full Inland Empire, the

largest groups were 10-19 years old (16.5%)

and young adults 25-34 years old (16.2%).

n Among adults ages 55 and up, there

were 112,237 people in the Coachella

Valley in 2006 or 29.0% of the population.

Reflecting the area’s importance as a retire-

ment community, this was far above the

17.4% for the Inland Empire as a whole

(Exhibits 5-6).

n Interestingly, people in their prime

working years from age 20-54 years old

represented just 45.2% of the Coachella

Valley’s population as opposed to 51.0%

for the full Inland Empire.

n From 2000-2006, Hispanics provided

29.6% of the Coachella Valley’s population

growth, well below their share in Riverside

County (61.5%) (Exhibit 6). Whites account-

ed for 21.8% compared to just 17.0% in

Riverside County. Persons who were multi-

ethnic represented 45.1% of the valley’s

growth versus just 6.1% in the county. As

people self-identify their ethnicity, this

appears to represent a choice of many valley

residents to choose this category.

25n In 2006, the share of population in Coachella Valley cities that was White was 43.2%

compared to 43.0% in the county (Exhibit 7). Hispanics were 43.4% in the valley and

42.2% of the population in the county.

n The Census Bureau’s new American Community Survey, which will be issued annually,

provides more accurate data than was previously available. It provides detailed information

on the full valley by school district boundaries.

n In 2006, estimates based upon the 2006

American Community Survey indicated

that the Coachella Valley’s total income

was $9.8 billion. That was 11.8% of the

$83.1 billion in total income for the Inland

Empire (Exhibit 8).

n The Coachella Valley’s average house-

hold income of $66,473 was about $2,000

lower than the Inland Empire’s $68,400.

Its per capita income of $25,934 was

roughly $4,000 above the region’s $21,740.

However, Coachella Valley’s median income

of $46,074 (half above & below) was lower

than the regional figure as medians are not

pulled up by very high incomes.

26

n The wide variation in community incomes is shown in median

incomes ranging from the $120,074 in Indian Wells and $72,434 in

Rancho Mirage to the $36,402 figure in Coachella and $33,263 in

Desert Hot Springs (Exhibit 9).

n Six Coachella Valley cities exceeded $1 billion in total income in

2006: Palm Desert ($2.1 billion), Palm Springs ($1.56 billion), La Quinta

($1.44 billion), Rancho Mirage ($1.27 billion), Indio ($1.20 billion) and

Cathedral City ($1.08 billion) (Exhibit 10). Three smaller cities had less

than $500 million in total income: Indian Wells ($482.3 million),

Coachella ($365.7 million) and Desert Hot Springs ($360.5 million).

27

28

n From 2000-2006, the Coachella Valley’s

employment went from 112,889 to 141,092

a gain of 28,203 jobs or 25.0% (Exhibit

11). In this period, the Inland Empire

was up 27.5%.

n The region’s economy grew because its

full time population is growing and its

convention, tourism and retirement activi-

ties are increasing. Also, companies in the

construction industry were very strong

throughout this period.

n From 2000-2006, the Coachella Valley’s

retail trade added 8,500 more jobs or

30.1% of its 28,203 expansion due to

growth in both population and tourism.

Construction added 6,930 jobs or 24.6% of

the job growth due to accelerating home,

hotel and retail development. The hotel

and amusement sectors including casinos

added 3,159 jobs or 11.2%. Engineering

& management added 3,145 jobs or

11.2%. The four sectors were 77.1% of the

area’s growth.

n The valley’s growing population caused

education to add 1,830 jobs from 2000-

2006. It was followed by the finance group

(1,287) and distribution (1,209) (Exhibit 12).

Distribution is important as the region seeks

to diversify its economic base. Ultimately,

distributors will likely locate facilities along

the Union Pacific Railroad’s right of way

through the area to handle goods entering

Southern California through the ports of

Los Angeles and Long Beach.

E M P L O Y M E N T

29

n The Coachella Valley tends to under-

perform the Inland Empire’s economy in

bad times but out-perform it in good times.

Thus, the area’s job growth was slower in

most of the early 1990’s and during the

2001-2002 recession but has been faster in

most other years (Exhibit 13). The impact

of the slowdown in construction on the

economy is seen in 2006 with the valley’s

jobs up 2.5% versus the region’s growth

of 3.9%.

30

n With the general expansion and diver-

sification of the Coachella Valley’s job base

from 2000-2006, its large and growing

retail sector went from to 21.7% to 23.4%

of employment (Exhibits 14-15). The sec-

ond largest sector, hotel and amusement

(including casinos), saw their share fall

from 15.2% to 14.4%. Meanwhile, the con-

tinued growth in residential, retail and hotel

projects caused construction employment

to soar from 9.8% to 12.8% and move from

the fourth to third largest sector.

n Increased urbanization and rising costs

caused agriculture to fall from 13.5% to

9.2% and drop from third to fourth

largest. Health care lost some share of jobs

from 2000 to 2006 going from 7.7% to

6.7%. Education remained constant at 6.5%.

Indicating some increase in the valley’s

diversification, the smaller sectors com-

bined went from 11.1%to 12.9%.

n From 2000-2006, the total payroll

released by the Coachella Valley’s firms

and agencies grew by $1.86 billion from

$2.88 billion to $4.74 billion.

n The gain in the Coachella Valley’s payroll

from 2000-2006 was $1.86 billion or 64.4%

(Exhibit 16).

31

n Of the $1.56 billion gain in payroll, $653

million was needed by workers to make

up for the 22.6% increase in Southern

California’s price that occurred from 2000-

2006. When this was deducted, the

Coachella Valley still saw the purchasing

power of its local payrolls far more than

double, increasing by $1.20 billion or 41.8%

(Exhibit 17).

32

n From 2000-2006, the largest share of the

$1.86 billion increase in the Coachella

Valley’s payrolls (20.2%) was from the $374

million gain in the construction sector.

Next was retail trade, which was responsi-

ble for $306 million (16.5%) of the increase

(Exhibit 18).

n The hotel and amusement sector

ranked third in payroll growth accounting

for $179 million (9.7%). The education

sector ranked fourth accounting for $179

million (9.6%). These four sectors accounted

for 55.9% of the Coachella Valley’s payroll

expansion.

n In 1991, the average pay per worker in

the Coachella Valley was $19,663. By 2000,

this had reached $25,538. It then moved

on to $33,596 by 2006. That was 9.8% below

the $37,235 for all Inland Empire firms

(Exhibit 19). The gap was 12.9% in 2005.

33

n The Coachella Valley’s average pay per

job increased by $8,058 (31.6%) from

2000-2006. Of this, $5,783 was needed to

keep up with the 22.6% gain in Southern

California’s prices. As a result, the average

worker’s purchasing power rose $2,275 or

8.9% (Exhibit 20).

n There is a correlation between average

pay by sector in the Coachella Valley and

the education or technical training

required by workers within it. The highest

paying sectors use well-educated workers:

government ($59,048), utilities ($58,030),

finance & real estate ($50,811), education

($49,966), engineering & management

($47,970) and health ($45,291).

n Blue collar sectors paid relatively

well: distribution ($42,530), construction

($38,120) and manufacturing ($33,007). The

economy’s difficulty is that three of its four

largest sectors pay below $30,000 per year:

#2 hotel & amusement ($27,856), #1

retailing ($24,101) and #4 agriculture

($19,231) (Exhibit 21). The exception was

#3 construction ($38,120).

34

n The number of firms in the Coachella

Valley has risen from 5,400 in 1991 to

6,240 by 2002, and 8,483 by 2006. The

gain from 2000-2006 was 2,243 firms or

35.9% (Exhibit 22).

n These numbers should be viewed as a

long-term “general trend” not “exact” data

as they do not include entrepreneurs with

no payroll. For this reason, upward or

downward fluctuations from year to year

are not as significant as they may appear as

they generally involve very small firms

switching from pure entrepreneurs to

employers of one or two workers.

n From 2000-2006, the largest number of

firms was added in retailing (505). The next

largest gain was in finance, insurance and

real estate (391). These were followed by

construction (379) and health services

(268). The strength of the Coachella Valley’s

economy is indicated by the fact that no

sector had a net loss of firms (Exhibit 23).

35

n Among the major sectors, the largest

number of firms in the Coachella Valley

during 2006 were those serving the area’s

growing population: retailing (1,823; 22.6%)

and other “consumer” services (1,153;

14.3%) (Exhibit 24).

n The Coachella Valley’s real estate markets

resulted in the next two largest number of

firms being construction (1,114; 13.8%) and

finance, insurance & real estate (993;

12.3%). In 2006, the fifth largest number of

firms was in the health industry (780, 9.7%).

n In 1991, the average number of workers

in the Coachella Valley’s firms was 13.5.

This remained relatively constant until

1997 when it reached 15.7. In 2000, the

average jumped to 18.1 workers per firm.

In 2006, the number of workers per firm

fell back to 16.6 as a number of very small

firms was added (Exhibit 25).

36

n In 2006, the data showed five sectors in

which residents of the Coachella Valley

had jobs were: hotel and recreation (17.1%),

construction (15.9%), retailing (13.3%),

education (12.7%) and professional work

including private health care (11.0%)

(Exhibit 26).

n By occupational type, a much higher

share of Coachella Valley workers were in

service industries, such as hotel, casino

and recreational jobs, than in the Inland

Empire generally (24.8% v. 16.0%). It had

a much smaller share of work in production

and transportation related jobs (6.1% v.

13.9%). In addition, the area had a smaller

share of unemployed (6.8% v. 7.4%) and a

larger share of agricultural workers

(3.8% v. 0.5%).

37

38

n From 1988-2006, existing home sales in

the Coachella Valley have cycled with

Southern California’s economy. Volume

peaked in 1989 at 6,367 units (Exhibit 28).

It fell to a post-Cold War recession low of

4,259 in 1995. From there, sales hit 6,211

in 1997 before stabilizing at about 5,000

units until the 2001 recession set volume

down to 4,451. Low interest rates and

strong demand set sales soaring to a record

7,574 sales by 2005. In 2006, volume was

still strong at 6,695 units, but plunged with

high prices and the slowdown to 5,240

units in 2006.

H O U S I N G

n By city, the Coachella Valley’s 2006 exist-

ing home sales were led by Indio (915) and

La Quinta (902). The cities of Palm Desert

(802), Palm Springs (731), and Cathedral

City (638) were next. The lowest volumes

were in Desert Hot Springs (564), Rancho

Mirage (324), Coachella (218) and Indian

Wells (146) (Exhibit 29).

39

n New home sales reached post-Cold War

recession lows of 715 in 1993 and 732 in

1995. From there, demand sent sales to a

modern record of 2,255 units in 1999. The

number stayed close to 2,000 units

through 2002 (2,679) before exploding to

4,065 in 2003 and a record 5,535 in 2004

(Exhibit 30). Given the pent-up demand

for housing in Southern California, the

aging of the baby boomer generation and

the fact that real estate out-performed the

stock market through 2005, the Coachella

Valley’s new homes continued to sell rapidly

at 5,490 units in 2005, despite rising prices.

The housing slowdown sent volume to

4,913 in 2006.

n By city, Coachella Valley’s 2006 new

home sales were led by three cities with the

most available land: Indio (1,666), La

Quinta (773) and Coachella (640), followed

closely by Palm Springs (630) and Desert

Hot Springs (574) (Exhibit 31). The valley’s

well developed cities added fewer new

homes with Cathedral City (176) and

Indian Wells (40) trailing.

40

n The pace of the Coachella Valley’s existing home prices stayed in single digits in

2007. In 2nd quarter 2007, the area’s median existing home price was $498,039, up

$27,848 or 5.9% over the median price all homes sales in 2006 ($470,191). Since 2000,

the valley’s prices have nearly tripled, rising 191.7% or $327,283 from a median of

$170,756 (Exhibit 32).

41

n Every income group can be accommo-

dated by the Coachella Valley’s existing

home market. In 2nd quarter 2007, median

home prices in Indian Wells ($1,020,000)

and Rancho Mirage ($755,000) were above

all of Southern California’s counties

(Exhibit 33).

La Quinta ($507,500) was below Orange

County ($715,000) and Palm Springs

($541,715) was below Los Angeles County

($580,000) and San Diego ($561,500)

counties. It was followed by Palm Desert

($481,358), just above the two inland

counties. Coachella ($297,500) and Desert

Hot Springs ($253,400) were among the

Southland’s more affordable markets.

Yucca Valley ($200,000) has emerged as an

affordable housing market for commuters

working in the Coachella Valley.

42

n Coachella Valley’s new home prices have slowed with the drop in demand. In 2nd

quarter 2007, the valley’s median new home price was $419,999, down $42,862 (-9.3%)

from the prices for all 2006 sales ($462,760) (Exhibit 34). Still, prices are up 42.8% from 2000.

43

n Again, nearly every income group can

be accommodated by the Coachella

Valley’s new home market. Indian Wells

($2,321,256) and Rancho Mirage ($638,500)

were above Orange County ($633,500), and

La Quinta ($563,500) was just below.

Cathedral City ($443,500) and Palm

Springs ($428,310) were below Los

Angeles ($505,500), but above Riverside

($421,000) and San Diego ($171,000)

counties. Palm Desert ($393,858) was just

below those counties but above San

Bernardino County ($387,000). Indio

($359,908), Coachella ($350,125) and

Desert Hot Springs ($326,326) had the

most affordable new home prices. Again,

high prices in the Coachella Valley are

making Yucca Valley ($264,475) a player

in the commuter market (Exhibit 35).

n The Coachella Valley’s class “A” apart-

ment market is relatively affordable by

Inland Empire standards. The average

rental rate in 1st quarter 2007 was $928, up

1.4% from 2006 and ranked well below the

inland region’s average of $1,128 (Exhibit

36). The market had only a 4.3% vacancy

rate. Its prices were far below those in

Southern California’s coastal markets.

44

n With a growing population and its con-

tinuing success as a regional and national

tourist and convention destination, the

Coachella Valley’s retail sales have soared.

In 2006, taxable sales within its nine cities

reached a record $6.05 billion, up $338

million or 5.9% from 2005 (Exhibit 37).

From 2000-2006, sales growth was $2.17

billion or 56.0%, far above the 22.7%

inflation rate indicating that the underly-

ing volume of goods grew substantially in

this period.

n The Coachella Valley’s taxable sales are

more volatile than the surrounding Inland

Empire (Exhibit 37). In good times, the

valley’s sales tend to grow faster than the

region as in 1997-2000. In poor times,

they tend to grow slower as in 2001-2002

(3% vs. 6%). This pattern was somewhat

broken in the good times of 2004 (14% v.

16%) and 2005 (9% v. 13%). In 2006, the

problems in the housing market likely

continued this pattern of slower growth

(6% v. 8%).

TA X A B L E S A L E S

45

n In 2006, Palm Desert ($1.60 billion) had

the highest retail sales, ranking 10th among

the 48 Inland Empire cities. It was followed

by Cathedral City ($908 million), Palm

Springs ($900 million) and Indio ($863

million). The mid-range cities were La

Quinta ($727 million) and Rancho Mirage

($536 million). Cities with sales below $325

million were Coachella ($321 million),

Indian Wells ($98 million) and Desert Hot

Springs ($97 million) (Exhibit 39).

n From 2005-2006, Palm Springs had the

greatest increase in retail sales ($77.6

million or 9.4%), followed by Palm Desert

($73.4 million or 4.8%), Indio ($68.0

million or 8.5%) and Coachella ($58.6

million or 22.3%). The latter had the fastest

growth rate (Exhibit 40).

n Given the importance of retail sales to city

finances, sales per capita are a key measure

of a municipality’s ability to provide services

to its population. They give an estimate of

the purchasing power per resident that this

tax supplies to the city’s services.

n From 2000-2006, the Coachella Valley’s

per capita sales went from $14,919 to

$17,568. That was a gain of $2,849 or

19.1% and left the valley with more sales

per person than the Inland Empire

($15,570) (Exhibit 41). That said, inflation

grew 22.7% in the six year period, indicating

that the volume of trade per person actually

fell slightly, as did the purchasing power

of local sales taxes per person based upon

this activity.

46

n Of the Inland Empire’s 48 cities, Palm

Desert ($32,173) ranked 3rd to Montclair

($35,622) and Ontario ($33,598) in per

capita sales in 2006. Rancho Mirage

($31,764) ranked fourth ahead of Temecula

($28,730) (Exhibit 42). Compared to other

major cities, Indian Wells ($19,824), Palm

Springs ($19,235) and La Quinta ($18,237)

ranked just ahead of Riverside. Cathedral

City was just below it ($17,535). Indio

($11,566) was below Fontana ($12,009).

n In 2006, Coachella Valley’s $6.05 billion

in retail sales were led by automotive

sales 16.2% ($980 million), down from a

17.8% share in 2005. Next was non-retail

outlets ($959 million; 15.8%). They include

manufacturers, distributors, builders and

professionals selling direct to consumers.

General merchandisers ($940 million;

15.7%) was third, followed by restaurants

($668 million; 11.0%) and other “specialty”

retailers ($637 million; 10.5%) (Exhibit 43).

47

48

n Total deposits in Coachella Valley area

financial institutions more than doubled

from a recession low of $2.62 billion in

1993 to $6.44 billion in 2006 (Exhibit 44).

From 2000-2006, the gain was from $3.4

billion to $6.4 billion, up $3.0 billion or

89.8% while inflation was 22.7%.

B A N K I N G

n In 2006, Palm Desert ($2.19 billion) had

the largest deposits in the Coachella

Valley. It ranked 3rd of 48 Inland Empire

cities after Riverside ($5.03 billion) and

San Bernardino ($3.0 billion). Palm Springs

($1.53 million) was second in the valley.

Among major cities, it was ranked after

Rancho Cucamonga ($1.76 billion)

(Exhibit 45). In the Coachella Valley, the

cities of Indio ($823 million), La Quinta

($552 million), Rancho Mirage ($461 and

Indian Wells ($328 million) were next in

size. The others were below $300 million.

49

n Deposits per capita in the Coachella

Valley have risen consistently from a low

of $9,649 in 1997 to $16,001 in 2006

(Exhibit 46). The decline from 1992

($11,436) to 1997 ($9,649) occurred both

because of the recession, and because

consumers began using money market

funds for checking and mutual funds for

saving. From 2000-2006, per capita

deposits went from $10,807 to $16,001, up

$5,194 or 48.1%. Inflation was 22.7%.

n In 2006, Indian Wells ($66,732) and

Palm Desert ($43,912) ranked 1st and 2nd

in per capita deposits among the Inland

Empire’s 48 cities, ahead of Big Bear Lake

($37,297). Palm Springs ($32,619) and

Rancho Mirage ($27,318) ranked 4th and

6th. Nearby, Yucca Valley ($24,548)

ranked 10th in the region. The valley’s

other cities were below 17th ranked Loma

Linda ($13,916) starting with La Quinta

($13,856) (Exhibit 47).

50

n In the Coachella Valley, three of California’s

mega-banks had the most deposits in 2006:

Bank of America ($1.5 billion; 17.9%

share), Wells Fargo ($766 million; 11.9%

share), and Washington Mutual ($735

million; 11.5% share).

n Several regional banks also had large

shares: Downey S&L (8.1%), World Savings

(5.9%), Union Bank (5.8%), La Jolla Bank

(4.8%) and PFF Bank (4.3%) (Exhibit 48).

n Palm Desert Bank ($278 million), a local

financial institution, ranked ninth during

the year.

Exhibit 48 Bank Deposits By Bank, Coachella Valley, 2006 (000)

Financial Institution 2006 Deposits (000) Market Share

Bank of America NA $1,150,501 17.9%

Wells Fargo Bk NA $765,759 11.9%

Washington Mutual Bank $734,868 11.5%

Downey S&LA FA $520,041 8.1%

World Svgs Bk FSB $381,427 5.9%

Union Bk of CA NA $373,676 5.8%

LA Jolla Bk FSB $310,057 4.8%

PFF B&T $275,147 4.3%

Palm Desert NB $271,944 4.2%

Firstbank $237,423 3.7%

Canyon NB $216,663 3.4%

Rabobank, NA $203,700 3.2%

Pacific Western NB $202,852 3.2%

Guaranty Bk $185,742 2.9%

Citibank (West), FSB $148,480 2.3%

Frontier Bk FSB $101,390 1.6%

California B&TC $87,535 1.4%

Provident Svgs Bk FSB $80,135 1.2%

Desert Commercial Bk $70,772 1.1%

Other: Under 1% Each $95,010 1.5%

Total $6,413,122 100.0%

S O U R C E : Highline Data

51

52

n Consistent with the Coachella Valley’s

expanding economy and rising property

values, the assessed valuation of the region’s

cities has accelerated. From July 1, 2000-

2007, valuation more than doubled rising

from $15.0 billion to $62.6 billion, up $38.2

billion or 156.4% in just seven years (Exhibit

49). The gain outpaced the inflation rate of

27.9% from 2000-2007.

n Since 1999, the Coachella Valley’s

assessed valuation has soared. It slightly

out-performed rapidly growing Riverside

County from July 1, 1999-2002. Since then,

the area’s aggressive growth has been some-

what below that of county. The valley’s cities

saw a record 21% in 2006 just behind the

county’s 23% (Exhibit 50). In 2007, the

growth was slower at 16% for the valley and

17% for the county. The gain from July 1,

2006-2007 was $8.6 billion.

A S S E S S E D VA L U AT I O N

53

n In FY 2007-2008, Palm Desert ($13.1 bil-

lion) had the Coachella Valley’s highest

assessed valuation followed by La Quinta

($11.9 billion). Palm Springs ($9.7 billion)

was third followed by Rancho Mirage

($7.8) just ahead of Indio ($7.0 billion)

(Exhibit 51).

n Indian Wells ($4.8 billion) was followed

by Cathedral City ($4.3 billion). The small-

est assessed valuations were in Desert

Hot Springs ($2.1 billion) and Coachella

($2.0 billion).

n Assessed valuation per capita is another

measure of a community’s ability to finance

governmental services for each resident.

From July, 1 2000-2007, this measure in the

Coachella Valley rose from $92,369 in

2000 to $171,907 in 2007, a gain of $79,538

per person or 86.1% in just seven years

(Exhibit 52).

n As inflation was just 27.9% from 2000-

2007, there was a significant gain in the

purchasing power of the property taxes

collected per person due to this gain in

valuation.

54

n On July 1, 2007, five Coachella Valley

cities had the highest per capita assessed

valuations among Riverside County’s 24

cities (Exhibit 53). Indian Wells ($961,477)

led followed by Rancho Mirage ($462,124),

La Quinta ($288,777), Palm Desert

($262,455) and Palm Springs ($207,026).

They ranked above Canyon Lake

($155,192) and Temecula ($135,119).

n Per capita valuation in the valley’s other

cities was Indio ($90,673), Desert Hot

Springs ($89,830), Cathedral City ($82,460)

and Coachella ($51,514), which ranked

23rd of the county’s 24 cities.

55

56

n The Coachella Valley’s crime rate

dropped from the 76.6 incidents per 1,000

people in 1994, to 57.4 in 2005, down 25%

(Exhibit 54). Altogether, there were 2,348

more crimes in 2005 than in 1994 (14.2%),

they came from a much larger population,

up 113,015 (52.2%).

C R I M E R AT E S

57

n For 2005, there were 57.4 total incidents

per 1,000 residents in the Coachella Valley

versus the 43.6 average for Riverside

County residents. The difference was

largely due to property related incidents

in the valley because of the large number

of tourists and part-time homes.

n By city, the Coachella Valley’s crime

rates in 2005 varied from a low of 45.6

incidents per 1,000 people in Cathedral to

94.1 per 1,000 residents in Desert Hot

Springs (Exhibit 55). In each case, the cities

exceeded Riverside County’s average of 43.6.

n By city, the Coachella Valley’s violent

crime rate in 2005 varied from a low of 1.4

per 1,000 residents in Indian Wells to a

high of 12.3 per 1,000 residents in Desert

Hot Springs. Four other valley cities were

also below Riverside County’s average of

4.6 incidents per 1,000 residents: Indio

(4.3), La Quinta (3.4), Palm Desert (2.9)

and Rancho Mirage (2.5). The Coachella

Valley average was 5.0 (Exhibit 56).

58

n By city, the Coachella Valley area’s

property crime rate in 2005 varied from a

low of 40.6 per 1,000 people in Cathedral

City to a high of 81.8 per 1,000 residents

in Desert Hot Springs. All of the valley’s

cities were above Riverside County’s rate

of 39.1 incidents per 1,000 people. The

average in the Coachella Valley was at 52.5

incidents. Again, these high rates are a

reflection of the large number of tourists

and part-time residences in the region.

59

n In 2005, 91.1% or 17,238 of the 18,924

crimes reported in the Coachella Valley

were property crimes: larceny-theft (9,410;

49.7%), burglaries (4,968; 26.3%) and motor

vehicle thefts (2,860; 15.1%). The other

1,689 or 8.9% percent were violent crimes:

assault (1,083, 5.7%), robbery (415, 2.2%),

rape (113, 0.6%), arson (55, 0.3%) and

murder (20, 0.1%).

60

n California schools are annually measured

by the Academic Performance Index based

on student testing. In 2007, California’s

students averaged 727. This was below the

731 in Desert Sands Unified School

District (Indio, Indian Wells, Palm Desert,

Rancho Mirage, La Quinta). The district’s

students improved by 5 points over the

726 in 2006.

n In the Palm Springs Unified School

District (Cathedral City, Desert Hot Springs,

Palm Springs), the 2007 average score of

671 and well below the state average or 727.

The district’s students improved by 6 points

over the 665 in 2006.

n Students in the Coachella Valley

Unified School District (Coachella, Mecca,

Salton City, Thermal) averaged 592 in

2007, up 10 points from the 582 in 2006

but well below the state average of 727

(Exhibit 59).

E D U C AT I O N

61

n In 2006, 76.2% of California’s 10th graders passed the high school examination. The

Riverside County average was 74.1%. In the Coachella Valley, 77.8% of Desert Sands dis-

trict’s did so and ranked 5th of the county’s 19 districts (Exhibit 60). It was 62.5% in the

Palm Springs district (16th) and 53.4% in the Coachella Valley district (19th).

n On the 2006 Scholastic Assessment Test, the seniors in the Desert Sands district (1,451)

ranked 6th of 18 districts in Riverside County. The Palm Springs district (1,417) ranked

10th. The Coachella Valley district (1,221) ranked 17th. All three districts were below

California’s average score of 1,506. Riverside County’s average was 1,428 (Exhibit 61).

62

C O L L E G E S A N D U N I V E R S I T I E S

College of the Desert

The Coachella Valley has been served by the

160 acre College of Desert since 1958. The

school offers the first two years of a four

year college education, as well as two year

technical degrees and certificated skill pro-

grams. In addition, the college works with

employers to offer workforce training

programs to enhance the abilities of the

existing labor force.To support its academic,

occupational/vocational, developmental

and community programs, the college

offers classes in basic skill development. In

fall 2006, the enrollment was 9,986, up 505

or 5.3%. In 2005, voters authorized $346.5

million in bonds to renovate and expand

the campus. Students can major in a wide

range of practical and academic fields. A

sampling includes: agricultural specialties,

automotive technology, air conditioning,

architecture and environmental design, life

and physical sciences, business/hospitality

management, communications, culinary

arts, health science, math, science, social

sciences, law enforcement and fire science.

UCR Palm Desert

In 2001, a $6 million gift was made to

the University of California Riverside to

establish the Richard J. Heckmann

International Center for Entrepreneurial

Management and launch a satellite campus

in the Coachella Valley. An additional $10

million from the State of California and a

donation of 20 acres of land from the city

of Palm Desert allowed the building to

begin in January 2005. Construction is

now complete. The inaugural class of stu-

dents began classes in 2006 in both MBA and

MFA academic programs. The campus has

state-of-the-art facilities including a high-

tech 300-seat conference hall, teleconfer-

encing and distance learning capabilities,

classrooms and seminar rooms and com-

puter labs.

California State University

San Bernardino

CSU San Bernardino began offering classes

in the Coachella Valley via leased land at

College of the Desert in 1986. The first of

three buildings on donated land in Palm

Desert was opened in 2002. In 2007, ground

was broken for the campus’s phase two.

Undergraduate degrees can be earned in

accounting, communications, criminal jus-

tice, english, finance, human development,

management, nursing, liberal studies and

psychology, as well as masters degrees in

public administration and education plus

educational credentials.

UCR - PALM DESERT

63

64

n The Coachella Valley’s third largest gain

from 2000-2006 was in the hotel and

amusement sector, up 3,159 jobs to 20,370

(18.4%). This occurred due to the expan-

sion of hotels, resorts, Indian gaming, golf

courses and other entertainment venues.

There was a slight decline from 2005-2006.

n Engineering & management firms

tripled their job base (200.9%) from 1,565

in 2000 to 4,710 in 2006, up 3,145 positions.

The gain ranked fourth in the valley and

was likely related to the construction

industry’s expansion.

n The Coachella Valley’s employment rose

from 72,974 in 1991 to 112,889 in 2000

and on to 141,092 in 2006, a gain of 28,203

or 25.0%.

n From 2000-2006, the largest gain in the

Coachella Valley’s employment was in

retail trade, up 8,500 jobs (34.7%) to reach

32,998 due to the expansion of the area’s

full time population and its increasing

success as a regional and national tourist

and convention site.

n Construction was the valley’s second

fastest growing sector from 2000-2006,

adding 6,930 workers to reach 18,022

(62.5%). It has now passed the declining

agricultural sector (-2,236 jobs; -14.7%) to

be the valley’s third largest employer.

n Education (24.8%) added 1,830 positions

to reach 9,211, the fifth largest gain, due to

the region’s rapid growth of young people.

Health sector employment was up 822 jobs

to 9,481, a modest 9.5% due to the area’s

large medical sector and a population of

both younger and older people than in

most communities.

A P P E N D I X . -Employment & Payroll Details

Exhibit 62.-Employment By Sector, Coachella Valley, 1991-2006

1991 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 00-06

Retail Trade 18,265 18,793 21,743 21,304 22,219 24,498 24,651 25,364 27,022 29,281 30,722 32,998 8,500

Hotel & Amuse 7,847 12,749 14,814 15,356 15,973 17,212 17,924 18,441 19,824 21,120 20,930 20,370 3,159

Construction 4,376 4,018 5,084 6,370 8,456 11,092 12,572 12,934 11,962 14,441 16,498 18,022 6,930

Agriculture 11,518 11,386 13,344 12,186 12,379 15,255 14,312 14,709 14,828 14,048 13,390 13,019 (2,236)

Health Services 6,325 6,618 6,522 7,892 8,269 8,659 9,157 9,420 9,750 10,136 9,948 9,481 822

Education 3,684 2,358 3,224 3,629 6,599 7,381 7,809 8,033 8,357 8,423 8,653 9,211 1,830

Other Services 4,722 5,867 6,206 6,099 6,741 6,990 7,121 7,326 7,993 8,263 8,275 8,053 1,064

Distribute/Transp. 2,923 3,252 3,597 3,910 4,385 4,863 5,597 5,759 5,737 5,827 6,239 6,071 1,209

Fin., Ins., R. Est. 3,582 3,485 3,229 3,283 3,766 4,428 3,628 3,732 4,522 4,708 4,996 5,715 1,287

Eng. & Mgmt 1,264 1,167 1,139 1,017 1,385 1,565 1,681 1,729 2,001 2,423 4,027 4,710 3,145

Business Services 1,661 2,513 2,766 2,851 2,855 3,242 3,403 3,501 3,918 4,294 4,374 4,256 1,014

Manufacturing 2,605 2,415 2,682 2,714 2,935 3,218 3,449 3,549 3,389 3,717 3,779 3,138 (80)

Utilities 2,138 1,997 2,001 2,259 2,090 2,157 2,229 2,293 2,902 3,065 2,698 2,625 468

Employ Agcy. 534 729 472 731 867 939 1,236 1,271 2,604 1,782 1,426 1,733 794

Government 1,534 1,298 1,262 1,269 1,394 1,391 1,353 1,392 1,537 1,467 1,736 1,689 299

TOTAL 72,974 78,642 88,084 90,870 100,310 112,889 116,121 119,453 126,344 132,993 137,688 141,092 28,203

SOURCE: CA Employment Development Department

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n From 2000-2006, the largest increase in

the Coachella Valley’s payroll was in the

construction sector which grew by

$374.3 million because of the area’s

strong residential, hotel, office and

shopping center markets. The payroll

more than doubled from its 2000 level

(119.7%) to reach $687.0 million, the

valley’s second largest.

n The hotel and amusement group had

the Coachella Valley’s third largest payroll

in 2006 at $567.4 million and was its third

fastest growing payroll since 2000, up

$179.4 million (46.2%). This came about

because of the expansion of the valley’s

hotel resorts, its new Indian gaming opera-

tions and its golf courses and tennis clubs.

n The payroll released by firms and

agencies located in the Coachella Valley

rose from $1.43 billion in 1991 to $2.88 bil-

lion in 2000 and on to $4.74 billion in 2006.

The 2000-2006 gain was $1.86 billion or

64.4%. Inflation of 22.6% took $653 million

of the gain, leaving a payroll purchasing

power increase of $1.20 billion or 41.8%.

n In 2006, the valley’s largest payroll was

in its retail sector at $795.3 million, due to

the area’s growing full time population

and its many convention and tourist visitors.

The payroll was up $306.4 million from

2000, the valley’s second largest absolute

gain (62.7%).

n In 2006, the education sector was the

valley’s fourth largest payroll at $460.3

million. Its payroll grew by $178.9 million,

the fourth largest gain in the Coachella

Valley from 2000-2006 (292.6%).

n In 2006, the health services group,

including hospitals, out-patient care,

senior care facilities and dentist’s offices,

had a total payroll of $429.46 million to

rank fifth in size. However, it fell from

2005-2006. The group’s pay has increased

by $99.4 million since 2000, the valley’s

eighth largest gain (30.1%).

Exhibit 63.-Payroll By Sector, Coachella Valley, 1991-2006 (million)

1991 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 00-06

Retail Trade $275.6 $330.5 $385.5 $377.2 $414.6 $488.9 $502.5 $548.3 $590.8 $652.5 $698.3 $795.3 $306.4

Construction $106.3 $105.0 $121.6 $167.1 $228.9 $312.6 $383.5 $418.5 $395.2 $482.1 $565.9 $687.0 $374.3

Hotel & Amuse $133.4 $232.2 $287.3 $310.6 $334.5 $388.1 $412.4 $450.0 $489.8 $542.2 $543.5 $567.4 $179.4

Education $105.1 $73.3 $94.8 $139.4 $256.0 $281.3 $340.5 $371.7 $380.9 $393.2 $412.6 $460.3 $178.9

Health Services $206.8 $228.5 $237.7 $290.2 $300.6 $330.0 $358.2 $390.8 $409.2 $450.9 $461.6 $429.4 $99.4

Fin., Ins., R. Est. $94.2 $107.6 $113.3 $124.2 $145.0 $169.7 $159.7 $174.3 $194.7 $222.2 $251.1 $290.4 $120.6

Distribute/Transp. $63.9 $84.4 $91.4 $105.2 $135.7 $149.8 $184.3 $201.1 $197.4 $220.8 $247.4 $258.2 $108.4

Agriculture $96.4 $111.3 $180.1 $176.5 $185.6 $218.2 $208.6 $227.6 $240.1 $248.0 $240.2 $250.4 $32.2

Other Services $81.1 $115.8 $120.9 $116.8 $124.5 $141.6 $152.1 $166.0 $204.1 $209.7 $228.1 $238.1 $96.5

Eng. & Mgmt $37.6 $44.9 $49.9 $34.8 $44.4 $51.9 $62.9 $68.7 $93.9 $106.7 $173.6 $225.9 $174.1

Utilities $67.5 $74.9 $85.9 $93.1 $92.4 $97.0 $107.1 $116.9 $147.9 $166.2 $145.9 $152.3 $55.4

Business Services $45.2 $51.8 $54.5 $71.1 $78.7 $77.5 $87.2 $95.2 $108.4 $120.6 $143.6 $149.8 $72.3

Manufacturing $66.0 $63.3 $73.5 $81.8 $88.2 $104.9 $105.8 $115.5 $114.7 $130.4 $134.8 $103.6 ($1.3)

Government $49.0 $48.2 $53.0 $52.2 $55.6 $58.6 $63.1 $68.9 $78.2 $92.5 $95.6 $99.8 $41.1

Employ Agcy. $6.8 $7.9 $3.8 $7.2 $9.5 $12.8 $17.9 $19.6 $47.9 $29.2 $26.9 $32.2 $19.4

TOTAL $1,434.9 $1,679.6 $1,953.1 $2,147.3 $2,494.3 $2,882.9 $3,145.9 $3,433.0 $3,693.1 $4,067.0 $4,369.2 $4,740.1 $1,857.2

SOURCE: CA Employment Development Department

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67

n There is a correlation between average

pay by sector in the Coachella Valley and

the education or technical training required

by workers within it. The highest paying

sectors use well-educated workers: gov-

ernment ($59,048), utilities ($58,030),

finance & real estate ($50,811), education

($49,966), engineering & management

($47,970) and health ($45,291). Blue collar

sectors paid relatively well: distribution

($42,530), construction ($38,120) and

manufacturing ($33,007). The economy’s

difficulty is that three of its four largest

sectors pay below $30,000 per year: #2

hotel & amusement ($27,856), #1 retailing

($24,101) and #4 agriculture ($19,231)

(Exhibit 21). The exception was #3 con-

struction ($38,120).

n The Coachella Valley’s average pay per

worker over time is developed by dividing

the total payroll in a sector by the total

number of full and part time workers in

that sector. The numbers can rise either

because pay levels for the occupations in

the sector go up or because the mix

includes more workers in higher level jobs.

n The average pay per job in the

Coachella Valley rose from $19,663 in

1991 to $25,538 in 2000 and on to $33,596

in 2006. The 2000-2006 gain was $8,058 or

31.6%. Inflation of 22.6% took $5,783 of

the gain, leaving the purchasing power of

the average worker $2,275 better off or

8.9%. The valley fell 9.8% below the

Inland Empire’s average pay ($37,235) in

2006 compared to a 12.9% gap in 2005.

n From 2000-2006, the largest absolute

gains in pay occurred in government

($16,902; 40.1%), engineering & manage-

ment ($14,818; 44.7%), utilities ($13,072;

29.1%), finance, insurance & real estate

($12,478; 32.6%) and education ($11,849;

31.1%). The importance of education can

be seen in these gains. Other relatively

large gains were seen in distribution and

transportation ($11,724; 38.1%) and busi-

ness services ($11,287; 47.2%). Pay in dis-

tribution and transportation sector has

accelerated due to the extensive adoption

of information technology.

Exhibit 64.-Average Pay Per Job, Coachella Valley, 1991-2006

1991 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 00-06

Government $31,912 $37,143 $42,011 $41,130 $39,929 $42,146 $46,654 $49,503 $50,907 $63,045 $55,063 $59,048 $16,902

Utilities $31,594 $37,516 $42,913 $41,191 $44,210 $44,958 $48,048 $50,974 $50,970 $54,240 $54,091 $58,030 $13,072

Fin., Ins., R. Est. $26,306 $30,884 $35,082 $37,840 $38,503 $38,333 $44,036 $46,722 $43,048 $47,193 $50,266 $50,811 $12,478

Education $28,531 $31,112 $29,397 $38,421 $38,793 $38,117 $43,609 $46,275 $45,583 $46,677 $47,686 $49,966 $11,849

Eng. & Mgmt $29,709 $38,452 $43,820 $34,177 $32,041 $33,152 $37,442 $39,702 $46,940 $44,018 $43,102 $47,970 $14,818

Health Services $32,697 $34,531 $36,451 $36,772 $36,348 $38,113 $39,117 $41,484 $41,967 $44,484 $46,406 $45,291 $7,178

Distribute/Transp. $21,873 $25,946 $25,402 $26,895 $30,954 $30,806 $32,919 $34,916 $34,401 $37,887 $39,656 $42,530 $11,724

Construction $24,300 $26,128 $23,908 $26,233 $27,067 $28,186 $30,506 $32,358 $33,036 $33,388 $34,305 $38,120 $9,934

Business Services $27,236 $20,614 $19,699 $24,921 $27,587 $23,918 $25,637 $27,185 $27,661 $28,090 $32,825 $35,205 $11,287

Manufacturing $25,345 $26,209 $27,395 $30,124 $30,062 $32,584 $30,679 $32,537 $33,837 $35,081 $35,680 $33,007 $424

Other Services $17,174 $19,743 $19,481 $19,152 $18,465 $20,258 $21,364 $22,660 $25,532 $25,375 $27,569 $29,567 $9,309

Hotel & Amuse $17,000 $18,211 $19,393 $20,227 $20,943 $22,546 $23,006 $24,402 $24,708 $25,671 $25,969 $27,856 $5,310

Retail Trade $15,088 $17,585 $17,732 $17,705 $18,662 $19,957 $20,382 $21,617 $21,862 $22,286 $22,729 $24,101 $4,144

Agriculture $8,369 $9,773 $13,495 $14,487 $14,991 $14,300 $14,576 $15,470 $16,193 $17,652 $17,937 $19,231 $4,931

Employ Agcy. $12,718 $10,839 $8,157 $9,858 $10,984 $13,636 $14,520 $15,402 $18,406 $16,379 $18,867 $18,601 $4,965

TOTAL $19,663 $21,357 $22,173 $23,630 $24,866 $25,538 $27,092 $28,739 $29,230 $30,581 $31,733 $33,596 $8,058

SOURCE: CA Employment Development Department

68