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Blog Archives - 2005 Third Quarter

  Atkins' outrageous letter of apology - 09/30/05  
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Toni Atkins knows that KPMG has no intention of issuing an audit in January.

Jim Madaffer said something very revealing when chairing the City Council Meeting on Monday. Protesting Aguirre's line of questioning of KPMG Madaffer said that he could guarantee that if KPMG quit we would not see an audit for another two years or more. For those who may be hurt by what an audit will reveal it is a no-brainer to have KPMG quit and blame it on Aguirre. Is that what is going on?

The $2.8 million we have already paid KPMG through September 15, 2005 is not contingent upon them issuing an audit. They can just quit on December 31, 2005 along with their paymaster Ewell. They can just take their money and run. Why should they complete the audit? Why incur the liability? That was exactly Aguirre's point on Monday! Yet Atkins sides with KPMG against the people of San Diego!

Her outrageous written apology to them is like apologizing to a rapist for your daughter's resistance. The Council plan seems to be to have KPMG and the Audit Committee quit on December 31 and blame it on Aguirre. Why else would Atkins write such a letter? She is setting it up.

I now understand the wisdom of Donna Frye declaring a state of financial emergency to combat this Council's gross mismanagement of City finances. She believes only the people, by direct ballot intervention, can save this City.
 
 
  Lamont has just dug himself deeper into his own grave - 09/28/05  
 

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You can almost feel the power of Lamont Ewell and the Office he holds melting away. He knows and everybody knows that a deluge of criminal charges will descend upon many who held high positions in the City Manager’s Office the moment he clears out his desk on December 31, 2005.


First clue was Arthur Levitt’s absence from his Audit Committee’s presentation to the City Council on Monday. Mr. Ewell would have liked to have him there, that’s what he is paying him for. I suspect we have seen the last public appearance of that wily old influence peddler. He knows his paymaster Mr. Ewell is a lame duck.

But the chicanery goes on.

Ewell and Levitt's partner Troy Dahlberg have cooked up a new scheme to comply with the SEC court order while continuing to withhold the eight controversial documents from the City Council. The Audit Committee has admitted to having seen them but has decided the documents are not relevant to its inquiry! I wonder how long that little subterfuge will hold up to public scrutiny.
 

 
  Fireworks over City's payment of "bribe" to Levitt - 09/27/05  
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Anybody who watched the heated exchanges (go to 1:36 mins) between Jim Madaffer and Mike Aguirre in the Council Chamber yesterday must be wondering what it was all about. The focus of this nasty episode was the absent Arthur Levitt.

Aguirre believes that Levitt does not actually do any work, that he trades on his reputation as past President of the SEC, that he is a professional influence peddler and payments to him are essentially bribes.

That is why Aguirre has been pressing for details of Levitt's bill. So far the City Manager Lamont Ewell has flatly refused to ask Levitt for any details of his time. So far Levitt has flatly ignored the City Attorney's direct request for a detailed bill showing anything that he has actually done or even anything he has read.

So the fireworks yesterday was Mike objecting to the City Council's continued payment of what amounts to a bribe to Levitt for his attempted cover up of illegal activities by certain Members of the City Council and City staff with the SEC.

Despite the fact that the SEC, through the courts, has forced SDCERS to cough up all the documents they have been withholding claiming attorney-client privilege, they now have told the Audit Committee and presumably the SEC that they are not going to part with eight mysterious documents. Troy Dahlberg, a member of the Audit Committee,  told the Council that these eight letters are all from Seltzer Caplan, CERS attorneys. One of them appears to be a legal opinion, Dahlberg said.

So, as I wrote on August 31, 2005, it all comes down to one smoking-gun document, a legal opinion letter that Aguirre believes will prove his case that the pension board knew they were acting illegally. That is what the stalling and cover up was all about.

Watching the level of coordination between Troy Dahlberg and Lamont Ewell was very revealing - Ewell pays Dahlberg's fee and actually works out of the City Manger's office. It is also revealing that the Audit Committee will run out of money (and authority) the same day City Manager Ewell leaves office - December 31, 2005.
 
 
  The more I think about Donna's bold plan the more I like it - 09/25/05  
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Donna Frye has bravely nailed her revolutionary "Financial Plan" to the church door, or should I say to San Diego's City Hall door. At least as far as this troubled town is concerned her soon-to-be-famous Financial Thesis is as clear, as "reforming" and possibly will be as controversial as that other famous document nailed to a church door in Germany so many years ago.

I say "brave" because, even as Mayor, she need not have taken upon herself the sole responsibility to solve the financial problems of the City. But she did, and that says as much about her and her dedication to San Diego as the document itself.

At first reading Donna's document seems breathtaking in its audacity and scope but once you get over the  initial shock you start to see what lies behind it. It is really quite brilliant in its conception and will probably be revolutionary in its implementation.

So what is she proposing? As I see it she is declaring a (financial) state of emergency and asking for emergency powers. That is the breathtaking part.

Why is she doing it? Obviously because she has completely given up on her City Council colleagues, as indeed have the rest of us. And because she thinks the city's union leaders are completely incorrigible, as indeed they are.

I asked her to explain why she is asking for such wide emergency powers: "First, without that authority we will continue along the same political path; second, the Mayor also needs the voter's authority to be able to file a Chapter 9 (if necessary) as leverage to get the unions to the table."

I know of nobody who knows the present City Hall better than Donna Frye and if that's her assessment then it's probably right. Sanders' assessment is logical but it does not come from the insight Donna possesses. So it all depends on how hopeless and how incorrigible the present Council and the present union leadership really are. Sanders seems to have more faith in these people than Donna does.

Donna has sat in that Chamber for four and a half years and watched the chicanery of people like Murphy, Madaffer, Maienschein, Peters and yes, Toni Atkins. She has listened to countless fifteen minute whines from Ann Smith every time Smith's MEA empire was threatened with reality. Ms. Smith thinks all city employees belong to a privileged class that should be totally immune to the realities of life outside City Hall.

Therefore it is hard not to agree with Donna. How else are we going to bring these people to heel?

If I read her correctly the ballot initiative she will introduce will be a temporary measure. I don't think she is challenging
the basic provisions of the newly added Section XV of the City Charter known as the Strong Mayor initiative. I think her problem is specifically with the present City Council and her measure will sunset when they go.

This lady means business. For that she deserves our support. We wanted decisive leadership - this is it. The more I think about her audacious plan the more I like it.

Sanders is probably a nice guy, but that is a liability not an asset in our present circumstances. Donna has sat among this den of thieves and knows them well.
 
 
  The City Council can always be trusted to sell out - 09/22/05  
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On August 21st I suggested that Bowtie Bob's (Bob Kittle Editor of the San Diego Union-Tribune Editorial Page) campaign to discredit Mike Aguirre is explained by the fact that the Sanders camp want to keep the pension problem unresolved until after the November 8th election.

Kittle has devoted editorial after editorial to lash out at City Attorney Mike Aguirre. He champions Levitt whose only function is to delay any resolution with the SEC until after Sanders is elected to give him leverage over City and union officials.

So today another long self-contradicting editorial from Bowtie Bob attacking Aguirre while praising the City Council and their high cost cover up man Arthur Levitt.

The Voice on the other hand have been following Aguirre's example and doing their own investigation into City Councilor wrongdoings, specifically Jim Madaffer.

It is bad enough having a corrupt City Council and an incompetent City staff but we are also damned with a highly partisan city newspaper with an editorial board who act as the mouthpiece for the Republican Party.

If Mike Aguirre is defeated in his efforts to make our city officials obey the law and hold them accountable, this city will descend into a long dark age of unrestrained greed.

What makes San Diego the perfect political storm is an unholy alliance between organized labor and private developers forged by a common greed. JMI and the Labor Council have come together to carve up the eastern portion of downtown. What new scandals are brewing in that Catagory 5 hurricane of corruption?

Continued last Tuesday (because it was altered at the last moment) a devious Affordable Housing Agreement between JMI and the City will be re-presented to the Council on October 11th. It is not enough that developers like JMI (Padres' owner John Moores development company) get free land and cash handouts, they want to avoid their legal obligations to provide a housing mix that includes affordable units.

Watching the proceedings in the City Chambers on Tuesday (go to 1:19) it was obvious that the usual developer-friendly cadre of Madaffer, Maienschein, Peters and Atkins were angry at the City Attorney's office for requesting a continuance, due to "additional legal questions". They attempted to ram it through without time for vetting by Aguirre's office. Maienschein was beside himself with personal venom for Aguirre.

Hopefully the continuance will give civic watchdogs a little space to find out what is going on. But in the end the deal being worked out behind closed doors will be skillfully maneuvered through the City Council on October 11th. The above four developer-backed Councilors have never let their powerful benefactors down one single time.
 
 
  How the decks are stacked against Donna Frye - 09/20/05  
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The editorial page of the San Diego Union-Tribune under its flamboyant and opinionated editor Bowtie Bob (Bob Kittle), is now for all practical purposes the Jerry Sanders campaign web site. The Union-Tribune editorial column will jump from side to side on any issue in order to attack Donna Frye.

I am rarely in support of the City Council these days but I am fully in support of them making a deal with the SEC behind Arthur Levitt's back or in front of his face for that matter. Bowtie Bob (Bob Kittle) on the other hand thinks the sun rises and sets from Levitt's posterior

He writes: "The audit committee has been kept out of the loop because Aguirre hopes to persuade council members to bypass the panel's probe of the city's financial irregularities and reach an early settlement with the SEC before all of the facts have been established. The audit committee has warned strongly against attempting to short-circuit the investigatory process as Aguirre proposes. Given Levitt's standing as the highly respected former SEC chief, his opinion ought to be given some weight by the council. Instead, he has been kept in the dark, along with the public, as the council plans to retreat behind closed doors to deliberate without benefit of his considerable experience."

Kittle just wants Levitt to be allowed to play the delaying role, while Aguirre wants to get all the dirt out before the election.

Kittle says "Before all of the facts have been established"? He and his Republican cohorts want to postpone the day of reckoning for Murphy until after the Mayoral election as Donna Frye, quite correctly, has likened Sanders to Murphy. They are both the creation of the same Republican business elite.


The Union-Tribune and its Republican corporate clients want Sanders in the Mayor's Office so he can carve up the City for them according to their Republican agenda. Jerry's office will become the meeting place for the City's business elite, regaled by Bowtie Bob with epic tales of corporations' divine right to rule. The Mayor's Office will become the new home of the Lincoln Club, in permanent session.

Donna Frye on the other hand would run the City for and on behalf of the people, meeting in the evenings in community halls as she has often doen. But the people's interests are diametrically opposed to big business interests. So they will tear her up between now and November 8th, if we let them.

Why? Because under Sanders every piece of land that can be developed will be developed, it will become Sanders' Law.

The manifest destiny of Corky McMillin, John Moores, Doug Manchester and Sol Price is to erect steel and concrete monuments to their insatiable greed on every square inch of developable land in San Diego. That is what they do, if we let them. To them "park" is a dirty word. The only park John Moores cares about is Petco Park and Spanos would shudder at the idea of putting a park in Mission Valley.

So how do we stop this? By educating ourselves for a start! By realizing that everything Bowtie Bob writes in his editorial column is designed to help the business elite. Why? Just look at the banner ads from the City's big corporations.

His "newspaper" is virtually the sole source of voter information about the candidates!

How can the people's candidate, Donna Frye, who has no prospects of raising real money, fight the corporations' candidate, Sanders, who has unlimited money? I wish I knew. But I can at least point out the bias of our city's one and only "news"paper.

Maybe more BLOGS like mine will one day right the information imbalance. In the meantime most are condemned to live in Union-Tribune "mushroom-land".
 
 
  We can no longer stand idly by - 09/16/05  
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Pat Shea is saying the reason his wife Diann Shipione, or anybody like her, is unwilling to go back on the pension board is because the existing City Council is not committed to fixing the pension problem. He says:

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Folks responsible for adverse conditions either grow up and deal with the problems, or not. And they are more likely to take the "or not" road if they were involved, in the neighborhood, or witnessed it from a distance without objection.

That is why the council will not replace any of the remaining pension trustees, remove the chairman, or do anything that would remotely bring the pension system into sync with the city it is supposed to serve. That will not happen unless, and until, new leadership emerges intolerant of the situation we find ourselves in, or the people that got us there."

Pat's remarks echo Mike Aguirre's waste water report released yesterday "At some point you see a pattern of recklessness and a way of doing business that serves the few at the expense of the many".

Jim Madaffer, defending his involvement, told the Union-Tribune "the decisions that went into the sewer rate reports and bond disclosures were all made based on advice from city attorneys and outside experts."

Yet Madaffer, together with Toni Atkins, Brian Maienschein, Ralph Inzunza, Byron Wear and Dick Murphy voted not to release a report by "outside experts", Black and Veatch, on Jan. 15, 2002 stating the need to begin charging users for organic materials. Donna Frye and George Stevens voted in favor of its release.

Andrew Donahue writing in the Voice today explains what was going on:

"In one 2003 memo included in the report, an official of International Specialty Products, Inc., a food ingredients manufacturer and the largest industrial user of the city's wastewater system, boasted that former City Councilman Byron Wear had persuaded his council colleagues -- with the exception of Donna Frye -- in a closed hearing to kill a 2002 attempt to adjust the rate structure.

David McKinley, the company's manager of environmental, safety and health, said that the new rate structure would have added annual costs of $1 million each to two of the company's plants in San Diego. One plant is under the ISP name, whereas the other is CPKelco."

So Byron Wear, one City Councilman, was able to persuade five of his colleagues to put the entire City's finances in mortal danger to save one campaign contributor $2 million per year! And they would expect no less of Wear if the situation was reversed.

Is that what Zucchet's lawyer, Jerry Coughlan is now trying to tell the courts? That the jury and the rest of us have a  "fundamental misunderstanding" of politics? That these actions are "staples of the American political system" as he has put it in his appeal?

Oh I think we understand it all right. Pat Shea is right. Diann Shipione is right. The San Diego political community and much of the San Diego City staff has become a criminal community. Pat Shea has gone so far as to call them thugs.
 

 
  Even the Union-Tribune can see through the City Management - 09/15/05  
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Mr. Bob Kittle has finally seen the light in his Editorial today. Either "Bowtie" Bob reads my blog every day or he has finally seen through City Manager Lamont Ewell and people like Lisa Irvine of the City Management staff. Is Kittle now ready to withdraw his outrageous characterization of Mike Aguirre as a "junta strongman in some quarters of Latin America" in his Editorial of August 17, 2005? I hope so.

Unfortunately Kittle's August 17th Editorial was prompted in part by the surprisingly unanimous vote of the City Council on August 9th, to approve
Items 330, 331 and 332
, against Mike Aguirre's strong advice, involving massive further payments to spurious "outside consultants" serving no purpose other than protecting City officials from the consequences of their illegal acts.
 
 
 

The never-ending cost of cover ups - 09/15/05

 
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I suspect if Donna Frye were to recast her vote on
Items 330, 331 and 332 on August 9th she may do it differently.

Last Monday on Item S401 (go to the 3 hours 20 minutes point) she was asked to vote a further $727,500 for Arthur Levitt's Audit Committee to hire an additional "Electronic Repository" company to do what
Vinson & Elkins
failed to do.

"What are they going to need after this?" asked Frye. She felt she was being pulled in "deeper and deeper", so she voted against it. Atkins gave the lame excuse that the investigation was "expanded" - always attempting to blame everything on Aguirre.

It is well worth listening to as it reveals a great deal about where these Councilors heads are, delaying everything in order to cover for themselves and members of the City staff. All of them except Donna Frye had no problem shelling out another $727,500 to their white knight Arthur Levitt.

But there is an old saying "if they will do it with you, they will do it to you". I predict that when Mr. Levitt has bled all he can from this City Council he will turn state's evidence against them - if he has not already secretly done so.
 
 
  Something very strange happened in City Chambers today - 09/12/05  
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I attended the City Council meeting today and spoke (go to 1 hour 49 minutes point) against Item 200 (page 43).

I was concerned that the City Council in accepting this City Manager's Report and "directing the City Manager to proceed with the evaluation of pension solutions" contained therein they might be accepting the unions' claim that the City is obligated to deposit $600 million in the SDCERS retirement fund before June 30, 2008, over and above the mandated actuarial contribution, as supposedly agreed in the June MOUs.

Before going to the Council meeting I asked the City's Labor Relations office for copies of the MOUs that were (supposedly)
Approved and Ratified (page 52) by the City Council on June 27, 2005. I was informed that they were not yet typed!

I talked to
Joan Raymond, President of AFSCME Local 127 in the City Chambers and asked her if she had a copy of the MOU for her own Local 127. She did not and understood that it is not yet available. I checked with her Local 127 Web site and sure enough it says: "We will post the contract on this website as soon as it is available".

What is going on?

Were these MOUs "approved", sight unseen, on June 30, 2005? Item 208
(page 52)designated in the Minutes as (R-2005- ) ADOPTED AS RESOLUTION R-300600 was supposed to be that action. I checked with the City Clerk's Office for the above numbered Resolution, or any labor relations action about that time. None exist!

I watched the entire June 27th discussion again and noted that Mr. Aguirre had refused to co-operate in this Resolution. Could it be that without his assent it never legally came into existence? He never wrote the actual Resolution. Is that the reason these MOUs are "not available"? If so there is no labor contract and therefore no City "obligation" to the unions to "leverage" the so-called union salary concessions.

Was today's Resolution a disguised attempt to "fix" this?

Even
Brian Maienschein stuck his head in the sand today. He spoke as if this pension problem is fixable. It isn't. That is why Lisa Irvine denied having seen actuarial forecasts past 2014. Perhaps they are so scary she dares not share them with us.

This Report is not a "first step" towards fixing the funding problem, as Scott Peters and Toni Atkins tried to represent, it is the first step towards bankruptcy.

The City Council (with the exception of Donna Frye) put their blinkers on today and knowingly followed union attorney Ann Smith into the gaping mouth of this monster that is growing exponentially. The ever spiraling pension cost feeds upon itself. We are paying 8% interest on the unfunded actuarial liability and amortizing it over 15 years.

There is no possibility of the City ever catching up. The unions have granted themselves benefits we can never pay. Please study the section dealing with this.


San Diego's pension battle has become the center of a wider battle between pension benefits and pension contributions in the public sector. It first became obvious to City Manager Jack McGrory back in 1996 that the City could not pay, but instead of facing reality he concocted a plan that could never work because the problem fed upon itself.

Brian Maienschein said he has not heard anybody propose a solution. Well I have: abandon the Defined Benefit plan in favor of a Defined Contribution plan.
 
 
  The stonewalling continues - 09/08/05  
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The City Manager is withholding $1 million from Vinson & Elkins for "failing to review approximately 57,000 of some 160,000 files identified as potentially relevant to the federal subpoenas ... as part of its investigation", purportedly because they didn't contain certain key search words.

These electronic files are in addition to the contents of Dick Murphy's and each of the City Councilor's hard drives that were never examined by V & E.

Mike Aguirre speaking to the Union-Tribune called these newly discovered review lapses "paltry compared to Vinson & Elkins' failure to extend its electronic document search to the hard drives of council members".

I remember Paul Maco of V & E being asked directly by Mike Aguirre in front of the City Council if V & E had examined Dick Murphy's and the other City Council Member's hard drives. Mr. Maco clearly told the City Council that they had not because it was they, the City Council, who had instructed V & E which drives to examine and which ones not to examine. Nobody on the Council corrected him.

Today City Manager Lamont Ewell told the Union-Tribune that "he was notified of the situation two weeks ago by members of (Levitt's) city audit committee" and that "Applied Discovery (a company under V & E supervision hired to collect relevant electronic documents) has blamed the problem on a technical issue in which some city employee e-mails were reviewed but related attachments accompanying those e-mails were not".

But we may have to pay the $1 million to V&E anyway because Mike Aguirre warned in his Fourth Interim Report dated may 9, 2002: "The Outside Professionals’ Audit Committee’s (Levitt) effort to relieve V&E of its contractual duty to provide the City with a written report may substantially prejudice the City’s rights to recover losses sustained by the City caused by V&E."

Thus Levitt cleverly shielded V&E because he had a close prior relationship with them and he knew they were vulnerable. But who is Ewell shielding today?

Why did Toni Atkins tell the Union-Tribune "It means we're definitely getting our money's worth. They're calling into question certain aspects, and that is exactly what we hired them to do, to be independent and objective."

Andrew Donohue in The Voice is probably closest to the mark: "City Attorney Mike Aguirre is suspicious of Ewell's claims that computer glitches caused the delay, accusing Ewell and the firm staffing the audit committee, Kroll, Inc., of working to delay the investigation in order to boost the audit committee's paycheck."

In a separate Voice article today by Evan McLaughlin, Aguirre is quoted as commenting regarding a City Manager's Report released yesterday: "What this proves is that it's hopeless to feed the insatiable appetites of those who want the illegal benefits. The city manager's report should be sold in Disneyland, because it's make-believe. What a great idea" he said "if we sell $600 million worth of pension obligation bonds and public land, and raise the city's contribution to 42 percent of total payroll by 2013, we'll still be back below 80 percent".

It seems the citizens of San Diego are going to have to fight their City officials and the City unions to prevent them selling the store and mortgaging what's left of it for several generations to come. I am not sure the citizens fully understand the enormity of the fraud that has been committed upon them. Please study the attached City Manager's Report.

In the meantime it
seems that the City Council plans on keeping Levitt indefinitely to do the cover up job he was hired to do.

Read Mike Aguirre's May 9, 2005 Report 4 where he showed how the so-called Audit Committee "regularly meets with those who were “potentially involved in misconduct” to keep them informed and updated".
 

 
  Jerry Sanders makes a  power grab - 09/08/05  
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Well who knew! Sanders' dramatic announcement today of his intention to force the  resignation of  approximately 300 top City officials from "the Mayor's office staff, the City Manager, Deputy City Managers, Department Directors, Assistant Directors, Deputy Directors, Program Managers and Coordinators, and Management Assistants" makes Mike Aguirre's so-called reign of terror at the City Attorney's Office look positively benign in comparison.

Why such a drastic announcement and why today?

The answer: Tom Shepherd. Tom is the general in charge of Sanders' army and obviously Tom has scoped out the ground on which he thinks the Mayoral battle will be fought - reform of City Government.

Like all good generals Tom has a keen eye for a political battleground. He has looked it over and he is absolutely right that the reform agenda is the hill upon which everything will be won or lost on November 8. But is he right in his opening gambit?

He has done exactly what I would have done if I were Sanders' commanding general, although not this particular tactic as it is fraught with danger. Yes, I would have made a bold strike to secure the (reform) political high ground, because like Tom, I am a man.

But Donna Frye is a woman. What will she do in response? She will do what a woman would do. That is why this contest is so interesting - the male mind vs. the female mind. Fiction writers love to explore the phenomenon.

As a woman (and savvy politician) Donna knows that Sanders must now defend the political territory he has so rashly seized. She knows that he and his foot soldiers will take heavy fire from the City "insiders" - whose long-held territory he has invaded.

But no doubt Shepherd has calculated that the louder the fire and thunder from that quarter the more Sanders will establish his "outsider" and therefore "reformer" credentials in the minds of the watching voters. Maybe.

Donna, being a woman, was never one to take the "make my day" approach with City insiders or with anybody else. It's not her style. She uses a more subtle (feminine) approach. Mainly she uses the law. So, enter her commanding general - Mike Aguirre.

General Aguirre has already carved out a considerable portion of the contested "reform" hill for himself and Donna, long before General Shepherd appeared on the City horizon.

(Read his six Interim Reports posted on this web site - in HTML format which provides hundreds of internal navigation links for study and reference.)

Donna's response will be (as it has always been) that the way to reform City Government is through the courts, hence her chosen General, Mike Aguirre. She will point out that we have a City Charter which has not been followed, State Law has been frequently violated, so has the State Constitution. That is what reform is all about.

The courts will flush out the wrongdoers and punish them (as two former City Council Members are painfully finding out). That is what the rule of law is all about.

Ms. Frye will point out to Sanders and his Republican Rough Riders who stormed the San Juan Hill of political reform today, that we are still a "government of laws not of men". That is not the way to reform. That is the way to conquest, which is maybe what this all about for Sanders' and his army of "free enterprise" carpetbaggers.

She will point out that under the rule of law the great issues of governance, so carefully catalogued in Mike Aguirre's six exhaustive Reports, will have to be litigated one by one. It took a long time for City officials to stray so far from the law, it will take time and patience to get us back on track - using the law.

Donna is fortunate in having a capable co-reformer in Mike Aguirre but the Sanders' "club them to death" approach will only inflame City Hall because it punishes the innocent with the guilty.

He can't possibly believe it will work therefore I can't help wondering if today's "reform" grab is not really a "power" grab.

Just imagine the patronage Sanders will have if he actually succeeds in firing the top 300 people in the City Government on his very first day! So he can replace all of them with his own political cronies!

If you think things are bad now can you imagine our City Government populated by every get-rich-quick Republican hack in San Diego County and beyond?

Not since Pancho Villa rode into Mexico City and turned it over to his blood-thirsty banditos will a city be so abused, not since the Northern carpetbaggers descended like locusts on the conquered South.

Hang in there Mike and Donna. Sanders' way is not the American way.
 
 
  Is the pension waiver now moot? - 09/06/05  
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Ann Smith got lost in her own verbosity and arrogance in the Council Chambers today which shows her vulnerability. Her unrelenting personal attacks on Mike Aguirre even had Toni Atkins beginning to show irritation with her.

Her passionate defense of Preovolus showed that the MEA handpicked him to prevent the release of the SDCERS' documents and that there is total identity between SDCERS and the MEA. The MEA has controlled the SDCERS board for years That is why the City is in such financial trouble. The unions have bled the City dry.

If the SDCERS pension board and the MEA did nothing wrong what are they so afraid of? Why the massive defense of this Preovolus guy who came before the City Council and said there was nothing wrong with the Pension Scheme? There is nothing wrong with it from MEA's point of view. It is the perfect cash cow.

Donna Frye was not buying any of it. She continued to insist on the public's right to see all the pension board documents. She said Preovolus' minimalist action was not good enough and that he acted only because he was forced to do so by a court order.

She reacted angrily to an MEA suggestion that she was only obeying orders from Aguirre in demanding Preovolus' removal. That was a huge mistake to underestimate Donna like that. Characteristically she then became even more insistent that she will settle for nothing less than full public release of all pension documents and reminded the MEA that it was SDCERS who first sued the City, not the other way around.

Scott Peters supported the MEA as usual asserting (falsely) that the City Council has achieved its objectives and will now get its audit as a result of Preovolus' recent action in allowing limited release of the pension board's documents to "qualified" investigators.

Not so with Atkins. She is like a weathervane. Today she sensed the wind was blowing away from Smith and favoring Frye and Aguirre. So she did her usual waffle of non-words that meant nothing even to herself and voted with Frye having said at the outset that she was seconding the motion for the purposes of debate only.

Peters, ever nasty, suggested that they had the votes to do the the waiver if Aguirre had not filed his lawsuit against SDCERS. Aguirre shot back that if such an agreement had been made by anybody on the Council it was done in secret and was a breach of the Brown Act. That shut Peters up.

Don McGrath, Aguirre's loyal assistant, got a little animated and said "the waiver is a joke", that he and Mike will get the documents when Levitt and the audit committee get them. The audit committee is not a privileged entity. By complying with the court order Preovolus my have put the pension documents in the public domain.

The appointment of Richard Rider and Diann Shipione to the pension board was abandoned because Richard and Diann had conditioned their acceptance on the removal of Preovolus.

Nominee Ezekiel E. Cortez bugged out but Thomas C. Hebrank hung in and got himself appointed. He may feel it will look good on his resume.

Hebrank lives in Kensington which is Atkins' district so he is probably her pick. It is interesting that Ann Smith filed a speaker slip in opposition but decided not to speak. Did she know he is in favor of the waiver? That would tell a lot about where Atkins is on the pension issue. I think the redevelopment issue means more to her.
 
 
  A bird's eye view of Toni Atkins - 09/06/05  
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Read my analysis of Toni Atkins' interview in the San Diego Union-Tribune yesterday which ends:

 
"Toni knows that the new Mayor's Office will have even less power than the powers of the previous City Manager's Office and the previous Mayor's Office combined. The big winners are the City Council and the developers. The present owners of single family lots located in the path of the "densification" juggernaut bearing down on them will have few friends on the City Council and the new Mayor will be powerless. Atkins like all upwardly mobile politicians knows where campaign finance comes from - redevelopment."
 
 
  "Rooting out political corruption and white-collar crime" - 09/04/05  
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Mike Aguirre said he inherited an office that had traditionally served as a "facilitator" for the City Council. "Casey Gwinn saw himself as a facilitator. He saw the city attorney's role as finding plausible excuses for the council. I see our role as upholding the city charter and holding the council accountable under the law to the people of San Diego."

That according to this article in today's Union-Tribune. It goes on:

"Aguirre said many of the departing employees are people who were unable to adjust to the new mission of the City Attorney's Office: rooting out political corruption and white-collar crime." I love it.

Now if only we could get Donna elected and have her "root out" the self-serving hell-hole that is the City Manager's and Mayor's Offices. Can you imagine the whining and crying when she starts doing what Aguirre is doing right now? Can you imagine the shrieking op-ed pieces by Ann Smith and Bob Kittle? The surgery will be painful.
 
 
  Ann Smith is a disgrace to organized labor - 09/03/05  
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According to a Voice article today Ann Smith believes she and her City union can collect on an illegal bargain: "regardless of how they were created, employees simply deserve those kinds of benefits." She thinks the end justifies the means.

Her strategy all along seems to have been: any benefit, no matter how outrageous, once promised must be delivered. Her instructions to her negotiators for years seems to have been: get them to promise the benefit and "Labor Law" will make sure they pay it.

Aguirre is right. Her strategy is not only illegal but is doing enormous damage to unions and collective bargaining. Any decent labor union would reject her and her outrageous policies. Such policies are better suited to gangland, not civilized society.

But she and her union are doomed to lose. California "Government Law" protects us from exactly what Ann Smith and her gang of selfish union officials have done to us.
 
 
  People are realizing that there is a cover-up - 09/02/05  
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The City Manager (with the connivance of the City Council) has appointed another "independent consultant", another super-expensive law firm this time from Philadelphia
called Morgan, Lewis and Bockius, another bunch of former SEC employees on the make. The Union-Tribune reports that "the firm's lead lawyer in San Diego will be John Hartigan, a former assistant director of enforcement for the SEC".

The whole purpose of hiring these "consultants" is to keep vital prosecutorial documents relating to the pension crisis out of the hands of Mike Aguirre. But the Council's fig leaf is slipping. People are realizing that there is a cover-up.

At next Tuesday's Council closed session Mike will present his proposal for a "Consent Decree" with the SEC. It is Item CS-11.

The open session will be notable for what it will not achieve:

Item 200 is "Appointments of Richard Rider and Diann Shipione to the San Diego City Employees’ Retirement System Board of Administration."

Item 203 is "Removal of Peter Preovolos as a Member of the Retirement Board of the San Diego City Employees’ Retirement System (SDCERS)."

Both Rider and Shipione have said they will not serve under Preovolos yet Atkins has docketed his removal after their "appointment". She is obviously playing games.

Item 204 is "Appointments of Ezekiel E. Cortez and Thomas C. Hebrank to the San Diego City Employees’ Retirement System Board of Administration."

The Union-Tribune reports that Toni Atkins is "displeased that Shipione tried to set guidelines for returning to the panel." So why is she even on the docket?

Atkins is posturing as usual. She and the City Council have no interest in addresing the attorney-client privilege issue. They want to keep that Seltzer Caplan memo out of the hands of Mike Aguirre for as long as possible. And so the cover-up game goes on.
 
 
  It all comes down to one Seltzer Caplan memo - 08/31/05  
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The San Diego Union-Tribue reports today: "
Sources say the most potentially damning of the records is a legal memo from an outside law firm suggesting the pension board broke the law in the 2002 vote on the balloon payment.

The brief – said to be from Seltzer Caplan McMahon Vitek, an outside firm that continues to work with the pension system – advises fund officials that the vote to allow the city's underfunding of the system to continue – in connection with increased benefits – could be vulnerable to a challenge based on the conflict-of-interest law."

If it exists, sooner or later that legal memo will be available to Aguirre and to the judge who will try the case. When that happens the 8 accused are toast and those who have been shielding them will have some explaining to do. Mike is right, somebody knew.
 

 
  Breaking with the unions will be Frye's ticket to the Mayor's Office - 08/30/05  
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Nobody wanted to tangle with the all-powerful city union bosses so the City Council voted unanimously to continue Levitt's doomed whitewash job. Donna Frye just wanted it all to go away until after the November 8 election. It won't.

The Court has given all the participant parties in the SDCERS case until September 30th to file their final pleadings. This will require many more hot Council closed sessions, more misleading leaks from Peters and more fiery public speeches from Ann Smith, but file they must by September 30th and Mike Aguirre is in the driver's seat.

Donna Frye must, by September 30, choose sides. Mike will want the City's strategy endorsed in the Mayor's race. His final legal pleadings on behalf of the City on September 30th, will be just that - final. He will make sure that the new Mayor is committed to the City's legal strategy. No more politicking with it.

The race will come down to this: Who better understands and is most willing to break the union stranglehold that threatens to bankrupt the City? By November 8 everybody will know that for many years Judie Italiano and Ann Smith have had this City by the throat, while elected officials like Murphy said "Thank God for Ann Smith".

To win therefore, either Sanders must break with his (Republican) backers and side with (Democrat) Aguirre or Frye must break with the unions. Once the city employee unions are identified as the problem (which they will) there are no other choices.

Openly siding with Aguirre will mean Donna losing the Labor Council endorsement! That's what Italiano and Smith have been holding over her. They will use union solidarity to rip it from her.

But breaking with the unions will be Frye's ticket to the Mayor's Office!

When the City's final Cross Complaint identifies the union representatives on the pension board as the source of our financial problems, a break with the unions will seem like a positive blessing for Frye. She will be seen to be on the side of the people.

Donna can do without Labor Council yard signs (which is about all they contribute) but Sanders cannot do without massive Republican money for his final TV advertising blitz.

The best that Sanders can hope for is that Donna will continue to listen to those who (continually) tell her that Aguirre is a liability not an asset. If she does, she will lose. Aguirre is her best chance of winning against massive Republican TV advertising.
 
 
  Mike's legal Cross Complaint is the Centerpiece - 08/29/05  
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This Cross Complaint by Mike Aguirre is now the eye of San Diego's political storm. Now that the Council has backed him Mike has made it the centerpiece of the City's defense against any SEC charges.

The 8 city and union officials Mike sued on July 6th are the "cross-defendants". They are no longer defending themselves against Aguirre as civil prosecutor, they are  defending themselves against the full might of the City of San Diego.

Item 33 of Mike's Cross Complaint quotes California Government Code § 1092: "Every contract made in violation of any of the provisions of Section 1090 may be avoided at the instance of any party except the officer interested therein."

Mike has ratcheted up the whole thing. In his July lawsuit he only asked the judge to set aside “any and all benefits conferred on any party as a result of the adoption of MP-1 and MP-2”, now at Item 49 he pins all blame for any SEC violations on the pension board! He points out that in the SDCERS annual reports or financial statements "no mention was made that the City had ceased contributing to SDCERS on an Actuarially-determined basis but was instead contributing on a basis of an agreement entered into between the Trustees and the City as described in MP1".

Item 91 "Unaware that Cross-Defendants' representations about the financial health of SDCERS were false, the City included said misrepresentations, which were reviewed and relied upon by the City and by members of the public including potential bond investors".

Item 92 "As a direct and proximate result of Cross-Defendants' actions the City's credit rating has been suspended and thus Cross-Complainants have suffered substantial loss and injury in an amount according to proof at trial."

Mike has offered the City Council the perfect defense in front of the SEC - provided it stops shielding the 8. Why do they need Levitt? To stall and do a whitewash.
 
 
  Mike Aguirre's legal strategy - 08/27/05  
 

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First, his bottom line:

There is no doubt that portion of the pension benefits are illegal in and of themselves because they are in clear breach of San Diego City Charter § 99 and California Constitution Article 16 § 18.

Charter § 99 says: ”
The City shall not incur any indebtedness or liability in any manner or for any purpose exceeding in any year the income and revenue provided for such year unless the qualified electors of the City, voting at an election to be held for that purpose, have indicated their assent as then required by the Constitution of the State of California.”

California Constitution Article 16 § 18 says essentially the same thing “No county, city, town, township, board of education, or school district, shall incur any indebtedness or liability in any manner or for any purpose exceeding in any year the income and revenue provided for such year, without the assent of two-thirds of the voters of the public entity voting at an election to be held for that purpose
.”

The judge will have no choice but to apply the law and rule illegal all pension benefits that were applied retroactively. You can’t increase the “multiplier” from 2.5% to 3% in the 25th year of a 30-year service and backdate it for 25 of those years. They created what is known as a "past service liability", which is illegal.

Rolling back the “retroactive element” of the pension benefit increases will net hundreds of millions for the City. That is Mike's bottom line. The retroactive portion is non-negotiable. See my blog on July 6, 2005 where I deal with this more fully.

He has requested An order setting aside the actions taken by the SDCERS board of trustees in 1996 and 2002 adopting the above proposals and further setting aside any and all benefits conferred on any party as a result of the adoption of MP-1 and MP-2, as alleged in this complaint.”

At least eight of the Board Members violated § 87100 of the California Government Code which states: “No public official at any level of state or local government shall make, participate in making or in any way attempt to use his official position to influence a governmental decision in which he knows or has reason to know he has a financial interest.

The judge will have no choice but to find the eight guilty of a § 87100 violation. (The District Attorney has also charged them with § 1090 violations which states "Members of the Legislature, state, county, district, judicial district, and city officers or employees shall not be financially interested in any contract made by them in their official capacity, or by any body or board of which they are members.")

Will the judge set aside “any and all benefits conferred on any party as a result of the adoption of MP-1 and MP-2”? Mike believes he will.

The City Council has used Charter Section 40 to block Aguirre suing SDCERS on behalf of the City for as long as they could. The Charter says that the City Attorney can only file lawsuits on behalf of the City “upon order of the Council”. That was why Mike's first suit was as the civil prosecutor for the City of San Diego under California Govt. Code § 91001.5.

Scott Peters is telling reporters that Aguirre has filed this Cross Complaint "in his own name" while Aguirre is telling reporters that he has Council authority. The people need the truth. We need abridged minutes of that closed session published. Mike would never file this or any other lawsuit in the City's name without Council authority.
 

 
  It is time for some honest, open debate - 08/25/05  
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Diann Shipione and Mike Aguirre are not on vacation these days. Their Letters to the Editor today show that they are on the job and very much in tune with each other.

Diann said "
Our city, and its pension system, misrepresented us into a box from which there is no easy or convenient exit." How right she is to remind us that it will take much more than Arthur Levitt and his "Audit Committee" to get us out of it, as the City Council and the San Diego Union-Tribune would have us believe.

She ends with an ominous warning of the dangers that lie in the fact that "our elected officials refuse to muster their own recovery plans, or tolerate those few who have one."

In his companion letter, Mike Aguirre asks us to begin working our way out of our present difficulties by starting "a fair and impartial debate on the plan that I have put forward." He wants us San Diegans to "regroup" and solve this thing ourselves.

Diann Shipione agrees saying "Aguirre's plan is remarkable only because he was willing to stick his neck out and propose it, as no one else seems ready to do."

It seems the debate Diann and Mike are calling for will not start until after Labor Day, when the two mayoral candidates say so, not when Diann and Mike say so.

It the candidates are using Levitt to avoid the whole thing until after the election, Diann and Mike are not going to let them, which may be the point of their two letters today.
 
 
  The truth about Donna Frye's voting record - 08/25/05  
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In view of Michael Congers' "bribe" allegation yesterday I think it is time Donna Frye clarified what happened on October 21, 2002 and November 18, 2002.

I extracted the relevant City Council Docket items for October 21, 2002 and November 18, 2002 and the two City Ordinances, O-2003-67 and O-2003-74 that were the final outcome of that year's pension negotiations.

On October 21, 2002 Donna Frye voted with the rest of the City Council (9-0) on the complete Consent Agenda for that day, which is normal. On that particular day the Consent Agenda contained Item 53, among many others, which are either City Manager "housekeeping" items or "introduction" items.

Item 53
"Introduced" Ordinance O-2003-67, the details of which would be the subject of "meet and confer" negotiations and then either be passed or rejected  after the usual amendments. This is normal, particularly in the case of ongoing labor relations as applied in this case. Donna was simply enabling those negotiations to proceed. Any other vote would have been considered "obstructionist" by the City Manager.

She was right to reserve her final vote and then vote her conscience when, and only when, all the labor negotiations were finally concluded.

The Mayor docketed Ordinance O-2003-67 for final City approval as Council Agenda Item 50 on November 18, 2002. Since the October 21, 2002 vote it had been much amended through the "meet and confer" process. Read the City Manager's "Supporting Information" where he refers to "recently concluded" negotiations.

Ordinance O-2003-67 was then passed as Agenda Item 50 on November 18, 2002 with Donna Frye casting the sole vote against it.

Ordinance O-2003-74 was "Introduced" as Item 51 on the same day, November 18, 2002  and  Donna was the sole vote against that too. Two weeks later on December 3, 2002 she had it "pulled" from the Consent Agenda as Item 50  when it came up for "Approval" and she again was the sole vote against it.

There seems to be a good deal of confusion in the media about Agenda Items that merely "Introduce" an Ordinance and those that actually "Approve" an Ordinance. There also seems to be confusion about the effects of Resolutions.

Here is what the City Clerk's web site has to say about "City Council Resolutions and Ordinances":

"
An ordinance is a law adopted by the City Council. Ordinances usually amend, repeal or supplement the Municipal Code; provide zoning specifications; or appropriate money for specific purposes. Most ordinances require two hearings: an introduction, followed later by the final adoption.

A resolution is a formal expression of opinion or intention of the City Council. Resolutions usually become effective upon their adoption.
"

From that explanation it is clear that a City Councilor may find it advisable to vote in favor of an Ordinance at its "Introductory Hearing" so as not to be obstructive and in the hope of amending it before its "Final Adoption", as Donna did with O-3003-67.

In addition to Item 50 on November 18, 2002, Item 133 consisted of two Resolutions (not an Ordinance). The Item was divided into two parts: Subitem-A was a Resolution regarding "Board Indemnification" and Subitem-B was a Resolution regarding "Employer Contributions".

Subitem-A was designated
R-2003-390 which indemnified Members of the Pension Board, provided that the City Council found, in each case and in its sole discretion, that the Board Member concerned was "acting within the course and scope of his or her employment" and "acted or failed to act in good faith". Donna Frye voted for it.

Subitem-B was designated R-2003-661 "Authorizing the City to enter into an agreement with the San Diego City Employees’ Retirement System regarding employer contributions." Nothing wrong with that so again Donna voted for it, knowing that R-2003-661 could not include any more than that when drafted.

But it was never drafted! It does not exist! Try it for yourself at the City Attorney's web site. You will find an Attorney No: R-2003-660 and an R-2003-662, but no R-2003-661. Therefore Subitem-B had no effect as R-2003-661 never came into existence.

This was very shady practice by the Mayor and City Manager, as was common at the time. It was the way Murphy did things. He played a constant cat and mouse game.

"Subitem-B" was clearly added as a ploy to include spurious "Supporting Information" for an "Employer Contributions" Subitem that did not exist. This "Supporting Information" has been wrongly quoted in the newspapers as if it were part of a Resolution or an Ordinance that was approved by Donna. It was not.

A Council Member has no control over what the City Manager chooses to put in his "Supporting Information". This was clear abuse and manipulation by the Mayor and City Manager. The Mayor had control of the Docket. He wanted this spurious "Information" in there. Murphy was a master manipulator, as I personally experienced over a period of three years watching his handling of the so-called San Diego-Shannon Sister Cities Partnership between his Office and a development Company in Ireland.

The author of Item 133's dubious  "Supporting Information" was Bruce Herring, who has since resigned in "dubious" circumstances. It is time the media got the facts straight.
 
 
  Congers uses the "Bribe" word - 08/24/05  
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The media coverage of yesterday's court decision clearly reveals the legal battle lines. The judge was just clearing the undergrowth around the case's core tree trunk.

Receivership remains at issue, so does the ability of the pension board to exclude Aguirre as their primary legal council. But the core tree trunk issue is now clearer than ever - whether the massive retroactive pension increases were legal or not.

Jennifer Vigil writing in the San Diego Union-Tribune today quotes Don McGrath's summary of the whole thing:  "whether Aguirre eventually should be allowed to serve as the system's legal adviser and whether the fund should pay (certain) employee benefit increases." McGrath, Aguirre's assistant, ended "That's the case. The rest of it is (just) technical."

Ronald Powel and Jennifer Vigil in a separate
San Diego Union-Tribune article today reports: "Michael Conger, a lawyer who successfully sued the city on behalf of retirees to stop the city's underfunding of the pension system, said he is not sure the City Council wants the pension board to waive attorney-client privilege. If it does, he said, the documents will reveal how the council bribed the retirement board in 2002 to allow the continued underfunding of the pension system."

"Bribed the retirement board"? That's what the man said. Michael Congers probably knows more about what went on than any outsider. He really shook them up with his Gleason Case, which he won. He would not use the word "bribe" lightly to the U-T.

You can get a feel for the arguments we will be subjected to over the next few months from this piece by Ann Smith in The Voice of San San Diego on June 21, 2005.

She suggests that both Aguirre and Congers gave underfunding the "nod" by not protesting strongly enough when the City Council were taking their unanimous votes in 2002. She believes
"
that both Mr. Aguirre and Mr. Conger acted in good faith and did what seemed "right" at the time based on what each understood about the issues."

Nice try Ann, but you forget to mention that they were not City Councilors. The Councilors were the ones who "bribed" the pension board to allow underfunding.
 
 
  The Billion Dollar Law Suit to come - 08/23/05  
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Today's court decision is in accordance with the City Charter which allows for a City agency to hire its own attorney when "necessary". It does not undermine or exclude the City Attorney as the City's "chief legal adviser". The judge clearly saw a "necessity", for which the Charter just as clearly provides. This is an important case.

Attorneys Seltzer, Caplan on behalf of SDCERS filed Case No. 851286 on July 26, 2005 Complaint for Declaratory Relief against the City of San Diego, requesting a judicial determination that all City Resolutions and Ordinances granting all existing pension benefits were legal and must be paid.

Ann Smith on behalf of the MEA filed a Complaint in Intervention on August 10, 2005 outlining the various City Resolutions and Ordinances granting pension benefits and requesting a judicial determination that they are all lawful and must be paid.

Case No. 851286, when it does come to trial, will be High Noon between Mike Aguirre and Seltzer/Smith. The prize is control of San Diego itself.

Brian Seltzer will ride into town that morning to take down this interloper Mike Aguirre. Seltzer will be backed by his formidable gang of hired guns, all bent upon defending their longtime City Hall gold mine. This is their town - Seltzer has been the behind the scenes king of this hill  for a long time now. Ann Smith will be circling like a hyena to chew on any pieces left of Aguirre when Seltzer has dismembered him. That is the plan.

Read the Case above, together with Smith's Intervention and you will see for yourself what is at stake. It will attract national attention, probably be known as The San Diego Case and will have profound effects on municipal pension systems all over the United States for decades to come. It will make or break San Diego.

For us anxious tax payers, it will represent a billion $$ won or lost on that day and control of this city for years to come - it is high noon between Democracy and Greed.
 

 
   My suggested "Joint Plan" for Donna Frye and Mike Aguirre - 08/22/05  
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Here is my suggested "Joint Plan" for Donna Frye and Mike Aguirre:

1. The City Attorney shall reaffirm, under the City Charter, the sole right of the City Council to initiate all legislation and personally refrain from any such activity.

2. The City Council shall reaffirm, under City Charter Section 40, that "the City Attorney shall be the chief legal adviser of, and attorney for the City".

The Council shall interpret "The Council shall have authority to employ additional competent technical legal attorneys to investigate or prosecute matters connected with the departments of the City when such assistance or advice is necessary in connection therewith" to mean exactly what it says: "additional competent technical" legal advice and only when "necessary". This clause is not to be used to exclude the City Attorney as the "
chief legal adviser" t
o the City, which includes the City's Pension Board as an integral part of the City's organization.

Those two items should put an end to the current turf fights.

3. Donna Frye and Mike Aguirre shall jointly ask the City Council to withdraw their three remaining representative Pension Board members and then nominate all six current City Council Members onto the Pension Board, with Diann Shipione making up the seventh member of the City's (Prop. H mandated) representation on that board.

These seven members shall call a special meeting of the Pension Board and place two resolutions on the docket; Item 1: the waiver of attorney client privilege on all documents sought by the various agencies conducting illegal acts investigations into the Pension Board's past activities and Item 2: the resignation of all six Council Members from the Pension Board immediately after passage of Item 1.

4. The City Council would first pass a resolution indemnifying the six Members against any and all legal liability arising out of the above action.

This would clear the audit logjam without raising any "1090" issues - there is no way the six City Council Members could be said to have "personally benefited" in any way from their above action. Their immediate withdrawal would preserve the independence of the board while demonstrating the overall authority of the City Council and its overriding responsibility to conduct an illegal acts investigation as required by KPMG.

5. Adopt item 12 of Mike's Plan: "The City Council will place on the June 2006 primary election ballot a Charter amendment that will require a majority vote of the City electorate to approve any increases in pension benefits."

6. Create a two-tier system where existing employees will enjoy the "Defined Benefits" plan but new hires will come under a "Defined Contribution" plan" (my plan last May)

Has anybody got a better idea?
 
 
  Lies, damn lies and City Councilors - 08/22/05  
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Last week I wrote "
Atkins and others are
.... promoting the idea that the City Council are supportive of their elected City Attorney in the roll backs and as legal counsel for the pension board. They know that is their vulnerability."

There is no doubt that Aguirre has been methodically setting up the entire City Council for a decisive lawsuit charging them with breach of their duties under the City Charter in that they have repeatedly and egregiously circumvented him as their City Attorney.

He is forcing them to choose between him and Ann Smith. So far Ann Smith seems to be winning - but they do not see the cliff towards which she is leading them.

The City Council mysteriously permitted Assistant City Attorney Les Girard to make this (unchallenged) announcement
at the August 15, 2005 City Council meeting (go to 1 hour and 43 minutes into this archived link), he said "last week in closed session by a unanimous vote the City Council authorized the city attorney to pursue a modified cross complaint in the action of SDCERS v. the city of San Diego and City Attorney Michael Aguirre."

Scott Lewis in the Voice of San Diego picked up on the word "modified", big time. He and I got into an email argument about what might be going on. I guess I gave the City Council Members more credit for brains than they deserve (at least Scott Peters).

In his column today Lewis explains how Peters has put himself and the rest of the City Council back on the endangered species list by continuing to assert positively, absolutely that none of the disputed pension benefits are illegal. How stupid is that?

Peters goes so far as to blame the Pension Board for being too trigger happy in filing their lawsuits against Aguirre and the City, thus forcing the City to become embroiled in Aguirre's cross complaints asserting illegality. Peters very stupidly says: "he (Aguirre) has been authorized to make that argument in his own name but not on behalf of the City Council or the City of San Diego." Then who is Mike Aguirre? Some guy off the street? It looks like Mike is running rings around Peters, Atkins & Co.

Lewis reports that he spoke to Council Member Scott Peters on Thursday who totally contradicted Aguirre's earlier version of what took place at the closed session of the City Council. So what is a reporter to do? I guess that is why these guys have closed sessions - so they can all lie about what took place.

This entire City Council is skating on very thin ice and may all be heading to join their former colleagues Zucchet and Inzunza in the Four Bar Motel for a couple of years.
 
 
  My theory - 08/21/05  
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The more I read Bowtie Bob's (Bob Kittle Editor of the San Diego Union-Tribune Editorial Page) obsession with discrediting Mike Aguirre the more I am convinced that my theory is correct: that they are making a monster out of Mike for Sanders to slay.

Just as Swaggering Sanders did at San Ysidro in 1984, when the shooting stops at City Hall and the bad guy goes down, the man before the cameras will be Sanders.

That is the plan. That is why Kittle devotes today's editorial to once again lash Mike.

They want to keep the pension problem going until November 8th. That is why they love Levitt (the least lovable man to visit San Diego since the 1915 rain man).

After the election they will get rid of him. That is why the August 9th unanimous vote to retain him and his entourage was so tragic. But it is not over yet. Frye and Aguirre now have time to "regroup" as Mike put it, and come out fighting on September 6th.
 
 
  Viva La Prensa - 08/20/05  
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I am glad to see that at least the Mexican American community have not forgiven Jerry Sanders for allowing James Huberty to kill 22 of their people (mostly children) at McDonalds in San Ysidro back in 1984, because neither had I.

La Prensa wrote: "It was revealing that the leadership of the Police Department failed to promote him for 13 times to a significant post thereafter. However on May 17, 1993, City Manager Jack McGrory picked him to succeed Chief Bob Burgreen. Mayor Golding and her City Council approved the promotion. It is also instructive to note that the rank and file, within the Department, highly disapproved of Jerry Sanders."

Jack McGrory and Susan Golding picked him because he had a history of doing what he was told. Jerry knew how you get on in the Republican Party- read what is put in front of you and your bills get paid. Republicans always pick somebody who will be "grateful". Who will Sanders' be "grateful" to this time around?

But things may be changing.

Like the immigrant Irish in the late 1800s, tired of digging canals and being housemaids to the rich, they turned the tables on the arrogant Republican bankers and mill owners.  They became politically active and seized City Halls all up and down the East Coast under the banner of the Democratic Party.

The rapidly politicizing immigrant Mexican population may be about to do the same. They may reverse the current downward spiral towards 1800s style rule by the greedy Republican establishment and start seizing City Halls all up and down the West Coast, beginning with San Diego.

Today's stirring article in La Prenza may be the first shot over the old establishment's bows. If so, their timing is right, they have the perfect champions in Frye and Aguirre.
 
 
  Bowtie Bob of the San Diego Union-Tribune Undertaking Co. - 08/19/05  
 
The San Diego Union-Tribune's demonization of Mike Aguirre is all about defeating Donna Frye - not about Aguirre at all. They can easily neutralize Mike once they get Sanders in the Mayor's office.

Bob Kittle (Bowtie Bob), Editor of the San Diego Union-Tribune Editorial Page, confirmed my suspicions on the KPBS "Editors' Roundtable" this morning.

He asked: "Which of the two Mayoral candidates, Sanders or Frye, will best be able to restrain this runaway strongman, Mike Aguirre?". That's what this is all about. It is about getting Sanders elected Mayor and keeping Frye out.

It is the old PR trick. First you maximize the problem then you market the solution.

The unrelenting drumbeat of hatred emanating from the San Diego Union-Tribune Editorial Page against Aguirre will continue right up to November 8. In the final weeks Sanders' backers will saturate the TV airwaves with their smiling cop Sanders, who will promise to arrest Mad Mike and chain him to his City Attorney's desk where he can quietly live out the remainder of his four year term - like Napoleon on St. Helens.

Not a bad plan. The trouble is that Mike is right - the city is in mortal danger.

If the Sanders crowd succeed, the McGrory-Murphy-Ewell-Sanders funeral march will continue, right into the financial grave, piped along by Bowtie Bob of the San Diego Union-Tribune Undertaking Co.

We cannot afford to let them succeed. They will make this a third world city, governed by bowtie elitists, while we all grub around for cheap food and clothing in Wal-Mart.
 
 
  All six City Council Members should go on the Pension Board - 08/18/05  
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Finally, we have all agreed that the city's top priority is to get its pension board to waive attorney-client privilege for the documents sought by Federal investigators.

But the City Council (except Donna Frye) are still wringing their hands and feigning frustration, putting the responsibility on everybody but themselves. Far from trying to get the waiver, they are desperately scouring all of San Diego County for seven Preovolus clones, who will make sure that we don't.

I therefore challenge them to nominate all six of themselves as the City Council's representatives on the Pension Board, with Diann Shipione making up the seven.

They could do that in a heartbeat if they really wanted to solve this problem. There can be no 1090 issues if they simply pass one resolution, waiving attorney-client privilege, and withdraw. They could hardly be considered to have benefited personally from that.

Sanders had nothing positive to offer either, except strong condemnation of the only one who is genuinely trying to do something - Mike Aguirre.

If they all fail to do what is so screamingly obvious, appoint themselves to the pension board and take the responsibility, then we should implement Maureen O'Connor's best solution below, "Solution No. 5" and recall the lot of them (except Donna of course).
 

 
  If not Aguirre who will face up to our problems? - 08/18/05  
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Before everybody starts jumping all over Mike Aguirre for opening yet another investigation as reported in the San Diego Union-Tribune today, they should remember that he did not invent these problems as his enemies continually charge.

This latest investigation
is as a result of city officials having received last Tuesday subpoenas requesting "a broad range of documents dating to 1996 related to sewer bills and potential city liability for not complying with federal, state and local laws governing the charges" according to the Union-Tribune.

What people have to realize is that our City Attorney is doing exactly the right thing to demonstrate to these agencies that the city is taking steps to rectify our problems.

While the City Council have been following a head-in-the-sand strategy Aguirre has had the courage to confront our problems and for that he is vilified as a megalomaniac.

Somebody has to face up to the reality of our situation. We cannot keep hiring a Levitt or a Preovolus to make every problem disappear in a cloud of verbose pomposity.
 
 
  Diann Shipione's op-ed on the Pension Crises - 08/17/05  
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For all those San Diegans trying to come to grips with the present Pension Crisis it would be well to reread Diann Shipione's op-ed piece in the San Diego Union-Tribune on April 9, 2003. Here it is.

The Union-Tribune editorial staff should read it and dare tell San Diegans this is all Mike Aguirre's fault. Lamont Ewell should read it and dare say he has not tried to "Razzle-Dazzle 'Em", as Diann put it.

The City Council (except Donna Frye) should blush with shame for their continued obfuscation since Diann wrote those words in April 9, 2003.

This city owes a great debt of gratitude to Diann Shipione. This is the girl they kicked off the Pension Board for telling the truth! And Aguirre's law suit is not justified?
 
 
  Where have all the thinkers gone? - 08/17/05  
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Where indeed! Maureen O'Connor wrote this op-ed piece in today's U-T offering five solutions to the city's problems:

"Solution No. 1: Create a legal entity called the "Pension Fund Archives." Put all the pension fund documents into an archival storage room – and donate the "archives" to the city of San Diego. Literally give the city the legal key to the problem."

"Solution No. 2: Direct new members of the pension board to present the City of San Diego with the real due bill for the pensions (legal or otherwise)."

"Solution No. 3: Put a gag order on the city attorney, the city manager, the pension board president, members of the council and all union representatives until the legal and financial issues are settled."

"Solution No. 4: Notify all city employees of the inability of the city to fund its 1996 and 2002 pension promises. Thank them for their work. Explain reality. Ask them to stay. Understand if they don't. Then put out the "Help Wanted" sign."

"Solution No. 5: Recall the entire City Council. They have proven themselves ineffectual and inept at dealing with a financial tsunami. Run a slate of candidates committed to move with fairness, swiftness and honesty to take back the city."

Where have all the politicians gone?
 
 
  Who are the real junta in this town? - 08/17/05  
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The center of this whole controversy between the San Diego Union-Tribune and the City Council with Mike Aguirre is whether he is the City's Attorney or not.

The San Diego Union-Tribune backs those on the City Council who want to circumvent the City Attorney by hiring outside attorney's for just about everything. They have already spent $15 million to do work that is the province of our elected City Attorney.

In their editorial today the San Diego Union-Tribune describe Aguirre wanting to represent the City before the SEC as: "That is the way junta strongmen behave in some quarters of Latin America, but that is not the way democratic government functions on this side of the border."

This City has finally elected a City Attorney who represents the people, not the power elite whose mouthpiece is the Union-Tribune. It is make or break time in San Diego.

If we do not support the only City official who has been elected by a city-wide vote we may well lose control of our city for generations to that "junta of strongmen" led by Bill Kollendar and the Union-Tribune that run this city. Remember the coup attempt Kollendar led to transfer misdemeanor prosecutions to the District Attorney's office?

From the moment Mike Aguirre was elected the real San Diego junta went to general quarters to get rid of him. We need to start the fight back by asserting Mike's continuing right to be the prime legal representative of the City in front of the SEC or anybody else. That is what the people elected him to do.

It was not the intent of last week's unanimous vote on
Items 330, 331 and 332 to grant that right to an outside attorney. It is one thing to hire additional technical legal experts to support the City Attorney, as was the intent, it is quite another to totally exclude the elected City Attorney, as the San Diego Union-Tribune absolutely wrongly assert.

Charter Section 40 clearly states: "The Council shall have authority to employ additional competent technical legal attorneys to investigate or prosecute matters connected with the departments of the City when such assistance or advice is necessary in connection therewith."

Note the words "additional" and "technical".

If Toni Atkins or anybody else on the City Council supports the San Diego Union-Tribune's interpretation they are guilty of a deliberate breach of the City Charter.

Get used to it City Council and Union-Tribune, the fact that you have had a cipher for City Attorney for twenty years does not mean it was right. This is right. Mike is right.
 
 
  Mike Aguirre provides "some leadership for a change" - 08/16/05  
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Mike Aguirre went to the editorial board of the San Diego Union-Tribune this morning and stuck his blue print for fixing San Diego's financial mess right in their faces.

Here is a link to the full document on the City Attorney's web site.

It looks like Mike has hit all the right buttons. If half of what he is proposing gets done we will be well on the way to solving the city's problems. How can this city not see that we have all the talent we need right here in San Diego? How can this be a political problem when we have all the political expertise we need? I am sure there were others who had input into Mike's plan.

I think I see a little of Richard Rider in there, particularly the part about a "proposed charter amendment called for by Aguirre would require a majority vote of San Diegans to approve any increase in pension benefits." That would at least close the barn door now and prevent future (give-away) horses from bolting.

What a pity the City Council did not ride Levitt and his bunch of verbose panhandlers out of town on a rail last Tuesday, so we could implement Mike's plan right away.

Unfortunately we will have to wait until the end of the year when Levitt and lamentable Lamont, our poor excuse for a City Manager, will have taken their pieces of silver and left. At least then we will be able to start fixing the mess they leave behind. And these were the guys the editorial board of the Union-Tribune thought were magnificent?

If only the City Council would take Aguirre's advice and fire Ewell right away. But they won't, Italiano and Smith will nix that.

Good for you Mike for providing "some leadership for a change", not just sloganeering.

Our fearless leader-in-waiting, Jerry Sanders, is exactly that - waiting. He wishes to wait until the "wise men from the East" tell him what to do (not to mention having to wait for word from Judy and Ann, not that he doesn't know their thoughts on this already). So he lamely blames Aguirre for "seeking to preempt the role of the Audit Committee in their interactions with the SEC, and of the courts in resolving issues that are currently under contention", surprise, surprise.

This is a direct contradiction of his criticism of Mike in his "Saving the City Pension Fund" on his web site, where he says "The problems with the City Attorney's strategy are that it leaves the decision as to the validity of the benefits in the hands of the courts, with uncertain results, on a timeline over which the city has no control". You should read your own plan Jerry, if of course you wrote it.

Then Jerry says "I strongly oppose his proposal to place tax and fee increases on the June 2006 ballot" referring to Mike's proposal number 10: "The City Council will prepare a revenue enhancement plan for submission to the electorate on the June 2006 primary election ballot that will raise sufficient funds to pay for all legal and replacement pension benefits."

What makes you so sure it is going to be "tax and fee increase"? That is what you would do Jerry, put it on the little guy. You know that Mike means to raid your redevelopment friends' piggy bank which is why you "strongly oppose" Mike's "revenue enhancements". You know very well that Mike means what Donna Frye has been calling for all along, that your fat cat "redevelopment" partners start paying their fair share into the City's general fund for police, fire and every other city service.

Now if only the people would back Mike instead of listening to the Union-Tribune tripe and the contradictory reactionism of the Jerry Sanders' candidacy. San Diego does not need "wise men from the East" and we certainly don't need a Mayor who thinks we do.
 
 
  There is always MacDonalds and Jerry will need a maid - 08/16/05  
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The latest demonstration of the phoniness of this whole attorney-client privilege waiver issue is Bill Lopez the City Manager's representative on the Pension Board being the instigator of the newest maneuver by SDCERS to hide the truth about illegal benefits that will could cost us taxpayers $1.7 billion.

Ewell was hand-picked by the union bosses, Judy Italiano and Ann Smith, for City Manager because of his compliance. That's how you get on in this city, you obey the union bosses. They have a long reach, onto every board and commission in the city.

The union bosses will now pick another "audit committee" for SDCERS and we will pay for that too. The ones we already pay $800,000 per month are not good enough?

Jerry Sanders on his web site under "Saving the City Pension Fund" offers a solution based on "simultaneously pursuing additional concessions from employee unions and securing a significant portion of the Pension Fund debt". (No mention of any roll backs, showing the hidden hand of Judy and Ann.)

He dismisses Aguirre's efforts to prove some portion of the debt illegal because "it leaves the decision as to the validity of the benefits in the hands of the courts, with uncertain results, on a timeline over which the city has no control." (That road is blocked by Judy Italiano and Ann Smith, nor has he any solution to the phony attorney-client waiver other than the usual pious hand-wringing.)

The key to his "solution" is contained in this sentence: "First, the city must show that employee concessions are being matched by the city's commitment to address a share of the shortfall." He will "negotiate" with the union bosses and of course they already have a plan, which he will impose on us taxpayers. Nice deal Jerry.

The union side of the deal will offer "concessions" like:
  • "Bringing the retirement age for city employees closer to national standards by raising it from age 55 to age 60 for general members and from age 50 to age 55 for safety members.
  • Setting 75% of average annual compensation as the upper limit for retirement benefits.
  • Increasing the employee contributions."

Our part: "Second, employees and their unions must trust that the city's leadership is moving forward to act fairly and effectively in managing the city's finances."

His "fair and effective management solutions": "the city should consider issuing pension obligation bonds to meet a portion of the Pension Fund debt" and:

"The city should also consider transfer of surplus real estate assets to the Pension Fund.  The value of the city's portfolio of surplus property runs into the hundreds of millions of dollars.  Securing a portion of the UAAL with such assets may be a prudent vehicle for restoring stability to the fund."

So there you have it. The Sanders Plan, courtesy of Judy and Ann.

The unions get to keep their illegal benefits and we get to issue millions of dollars of P.O.B.s and transfer of our "surplus real estate" to the Pension Fund to pay for it.

From a Lincoln Club perspective everything owned by the city is surplus - only businessmen should own property. We working stiffs better rally around Donna. Of course there is always MacDonalds and Jerry will need a maid.
 

 
  Ann Smith's Army is on the march - 08/15/05  
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Scott Lewis in his Voice of San Diego column today seems to be privy to what goes on in Council closed sessions, or somebody is using him to get their  message out. He reports that
"The City Council also gave formal support to Aguirre's efforts to become the legal counsel for the pension board." Really?

Then he drops the "deal" bombshell: "The City Council did, however, only agree to join Aguirre if he modified the suits and dropped his request that specific individuals face financial penalties for their alleged contribution to the city's pension problem".

They want us to think that they are buying Aguirre off.

Then Toni Atkins goes on KPBS radio this morning and tells us that there were at least two secret meetings between "some members" of the City Council and the SEC (she did not mention Levitt) and THAT THE CITY ATTORNEY WAS PRESENT!

Why do I have a feeling that Scott Lewis has been given a bum steer. Atkins' entire interview on KPBS was an attack on Aguirre.

Mr. Aguirre in his summation before the vote on Item 330 on Tuesday (go to 6 hours 48 minutes into this archived link) said “I understand that my Council is not supporting their elected City Attorney on this”.

Atkins and others are now trying to
counter that by promoting the idea that the City Council are supportive of their elected City Attorney in the roll backs and as legal counsel for the pension board. They know that is their vulnerability.

I contacted Mr. Lewis and he informed me that his primary source for his report was this announcement by Les Girard at Tuesday's City Council meeting (go to 1 hour and 43 minutes into this archived link):

Girard says: "I made this announcement following the conclusion of closed session last week but the open council meeting was over and I just want to restate it again for the record. Last week in closed session by a unanimous vote the City Council authorized the city attorney to pursue a modified cross complaint in the action of SDCERS v. the city of San Diego and City Attorney Michael Aguirre. In addition, the council, by the same unanimous vote, authorized the filing of two cases against potential plaintiffs with regard to recovering monies for professional services related to the pension issues."

I made this summary of Aguirre's law suit on July 7th, 2005.

Mr. Girard's announcement is not very clear but it appears that what has happened is that the city in their cross complaint against SDCERS' suit against the City and Mike (which is different from Mike's) have not asked for triple damages.

But Mike's original complaint still does. He has not "modified" his suit - Mike has not "dropped his request that specific individuals face financial penalties" as Lewis has suggested, it just isn't in the city's cross complaint, that's all.
 
 
  Levitt had "reason to believe" all right - he set it all up - 08/13/05  
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In my BLOG of August 9th I wrote:  "Levitt, Mr. Fix-it from the East, also said he "had reason to believe" that there would be movement on the SDCERS waiver issue soon. Has he fixed that too? I noticed that Judy Italiano speaking on Item 500, pleaded with the Council to give Mr. Preovolos just a little more time. Is Levitt about to make that issue disappear too?" By the way, he left out that little tit-bit in his op-ed version of his speech to the Council.

The Voice Of San Diego yesterday reported that "San Diego's pension board will consider at a special meeting called for Monday a waiver of attorney-client privilege".

But it was all fixed long before Tuesday's City Council meeting, which explains a lot. It explains why Donna Frye and Tony Young voted to retain Levitt and Kroll Inc. Those two Council members could have sunk the whole ship - but they didn't. Levitt bullied them with what he can get the SEC to do to this city if the Council does not box in Aguirre and prevent him from uncovering the wrongdoings we all know took place.

Levitt said in front of the Council on Tuesday
"This past week, the Securities and Exchange Commission confirmed the wisdom of this approach in regaining access to the sources of public funding needed to begin to restore the city's financial viability – and the viability, in particular, of its pension system." This means that the first bond issue will be massive P.O.B.s (Pension Obligation Bonds).

Now that the City Council members (to their shame) have unanimously renewed Levitt's contract, whatever the Pension Board have been hiding will be released to him not to Aguirre. He will then write "Whitewash 3" or have V & E's replacement write it.

As usual, the city employee union bosses are calling the shots. Ann Smith has outmaneuvered Aguirre, with the help of the City Council. But only for now. This is very shortsighted on the part of the Council and will come back to haunt them. It is very similar in nature to the quid pro quo of MP1 and MP2, which have not gone away and will not go away.

From inside the City Council counsel it looks like everybody comes out of this deal smelling like a rose, except Mike Aguirre. They may have grievously underestimated Aguirre and the rule of law. As I said on August 9, "facts are stubborn things".

The fact is that the City Attorney is the lawful legal advisor to the SDCERS board. The fact is
that "Negotiating directly with the SEC is the role of the elected city attorney" as Mike so correctly put it. The fact is that the City Council has put itself in serious legal jeopardy by seeking to circumvent the elected City Attorney. They may yet have to resign en masses over this issue. And by their own vote, they may not have their legal expenses paid by the City. We are, after all, governed by laws not by men.

Where did the City Council go wrong? They allowed Levitt to get the city employee unions off the hook. They held at least one illegal meeting with him and the SEC where he browbeat them into accepting his plan to "fix" things. None of them had the courage to resist him (or the Union-Tribune). And they (wrongly) kept Aguirre out of it.
 
 
  Heads will roll - 08/12/05  
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There are some who want to clean up San Diego and there are some who do not.

Mike Aguirre's letter to the U-T today is actually very conciliatory in view of what some in this city are putting him through for having the temerity to get himself elected without the permission of un-elected bosses like Ann Smith and the Union-Tribune.

Mike confines himself to making the following points:
  1. He is not a rookie to SEC matters, therefore the Charter prevents the Council from hiring outside "competent technical legal attorneys". There is no need.
  2. Nevertheless he did support the hiring of Kroll Inc. in February 2004 as an audit committee "with the understanding that the committee would be an independent investigation into the genesis of the city's financial crisis".
  3. Levitt and his so-called audit committee proved they were not independent when they "actually helped V&E draft a second "whitewash" report" - whose first report was soundly rejected by auditors KPMG.
  4. Mike points out "that Levitt and the audit committee do not speak for the SEC and should not presume to act as a liaison between the SEC and the city". They were not hired to do that, but that is exactly what they have done.
  5. "Negotiating directly with the SEC is the role of the elected city attorney, and I do not intend to abdicate that responsibility". Nor should he.
  6. The outgoing City Attorney did one last service for his un-elected bosses: "four days before I was sworn in, the former city attorney altered the reporting relationship to allow V&E to report directly to the mayor and the City Council on its investigation". They all knew what Aguirre's election meant.
  7. Levitt, who was hired to "reconcile" the new City Attorney's reports with those of Vinson & Elkins, has read none of Mr. Aguirre's six written reports. Of course not, he was hired to ensure that they were ignored and discredited.
  8. Lastly, Aguirre's plan to "get rid of the illegal pension benefits and fund the legal ones" and to "replace any city official who participated in the wrongdoing" and to "adopt a package of reforms to make sure that this never happens again" was suppressed and never put before the Council.

Nor was any computer hard drives belonging to Dick Murphy or any of the City Council members included in the "investigation". Why should they? The investigators were investigating themselves. This is "Watergate-by-the-sea" not "Enron-by-the-sea".

The only thing on which I would differ with Mike is this: "Unfortunately, it appears the audit committee has succumbed to political pressure from city officials and other insiders". He is much too lenient on both of them, it is the other way around.

They did not just succumb, they were hired to neutralize Aguirre and continue to do so with the help, to their eternal shame, of the San Diego Union-Tribune. If the Union-Tribune do not want to clean up San Diego, then they must be part of it. My money is on Mike and the good sense of the good people of San Diego. Heads will roll.
 

 
  Mike asserts his rights under the Charter - 08/12/05  
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It didn't take long for Troy Dahlberg of Kroll Inc. to cash in on the Council's weakness on Tuesday by pointing to "the council's decision Tuesday to extend the committee members' contract as proof that the city has faith in their work", according to this interview with Jennifer Vigil in today's San Diego Union-Tribune.

I doubt Donna Frye meant it that way, but she did vote to accept their report and to continue funding their ritzy lifestyle by paying their bill, now up to $6 million. Not bad for a firm specifically hired to contradict the findings of San Diego's City Attorney. Of course the word used in Ewell's contract is "reconcile", but "refute" is the word meant.

I wonder how many of these scams Kroll Inc. has going around the country. What is Ewell getting out of it? Is Levitt taking advantage of more than San Diego? It would make a great story for 60 Minutes.

Jennifer Vigil's story confirms that a meeting did indeed take place with the SEC on Friday August 5. We know that at least Atkins and Tony Young attended and that the SEC "expressed confidence" in Levitt and his firm, Kroll Inc. Atkins went so far as to "vent her displeasure with Aguirre, who did not inform the City Council that he would be asserting his right to appear on the city's behalf before the agency."

He doesn't need to, no more than he needs to assert his right to do any of his duties.

The Charter is very clear on his duties.
Charter Section 40
is also clear on the fact that
"The Council shall have authority to employ additional competent technical legal attorneys to investigate or prosecute matters connected with the departments of the City when such assistance or advice is necessary in connection therewith."

The Council must first prove that the City Attorney is incapable of representing them before the SEC. Clearly Aguirre is more than capable, which is why they don't want him to do so. Ann Smith is afraid he might point the finger at some of her MEA clients.
 
 
  Mike Aguirre has found a worthy opponent - 08/11/05  
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Now we know what Mr. Levitt meant by "Indeed from the outset of this project, we have been clear that we cannot complete the task at hand without the active support and cooperation of key members of the San Diego community", when he spoke imperiously in front of the City Council on Tuesday.

He was referring of course to the editorial board of the San Diego Union-Tribune. As an old hand at the Washington power-game he made sure the U-T would have a well honed
editorial ready for the day he published his own well honed op-ed piece, glorifying the part he is playing in saving San Diego from Mike Aguirre.

There are a few flies in the ointment of his well-laid plan however:

His piece says: "
This past week, the Securities and Exchange Commission confirmed the wisdom of this approach in regaining access to the sources of public funding needed to begin to restore the city's financial viability – and the viability, in particular, of its pension system." That was illegal.

He has now embroiled representatives of the SEC in his machinations. Not only was Friday's meeting between members of the San Diego City Council illegal in its breach of the California Brown Act, but it was also illegal in its breach of the laws governing the activities of all Federal regulatory bodies (investigative journalists please note).

This is the guy who was in charge of the SEC while WordCom bilked the investing public of $11 billion and while his friends at Vinson & Elkins cavorted with Ken Lay.

I think our Mr. Aguirre has found a worthy opponent. This will propel him onto the national stage - and the San Diego Union-Tribune into the national trash can.
 
 
  We need Donna Frye to be Donna Frye - 08/10/05  
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During yesterday's Council meeting Tony Young and Toni Atkins both referred to a meeting with the SEC last Friday. I would love to know where it was held and who was in attendance. Any whistle-blowers out there?

The chances are it was held in the City Manager's or the Mayor's conference room. If there was a quorum of City Council Members (who would dare miss it?) it was a flagrant breach of the California Brown Act. In any case it was an outrageous power-play by Levitt, but that's his style.

It certainly determined the outcome of yesterday's historic Council Meeting in advance. The shenanigans that went on behind the scenes may yet come back to haunt the Council Members who attended. That is not the way to do the people's business.

San Diego is not Washington DC. We have a thing called the Brown Act here in California. Levitt and the other hired guns from the East may not be familiar with it, but all the members of the San Diego City Council certainly are.

I have a feeling Atkins & Co. may be in for a refresher course - from Mr. Aguirre.
 
 
  Mike may still win - because he is right - 08/09/05  
 

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Items 330/1/2 on today's Agenda were passed unanimously - including Donna Frye!

This amounted to a vote of confidence in Kroll Inc., the one-firm "audit committee", despite Mr. Aguirre's reservations. I was surprised that Donna Frye did not back him; his presentations were clear and credible. Donna all but apologized for Mike's behavior during her summing up. I wonder how it will affect their relationship.

Mr. Aguirre is concerned that the intent is the same as the first Vinson & Elkins report - to find that there was no quid pro quo in 2002. He pointed out that Kroll Inc. guided Vinson & Elkins in drafting their second report so that it minimized the "smoking gun" memos Aguirre had found between certain City staff and the Pension Board.

The City Council (possibly now including Donna Frye) are banking on the status of Arthur Levitt, as a former chairman of the SEC, giving sufficient cover to KPMG to issue the audit and make the SEC go away.

Jim Madaffer, for one, is not very anxious to have his computer hard drives added to the 28 city employee hard drives already copied and searched by Vinson & Elkins. Perhaps there might be some revelations about the Data Processing thingy on Jim's drives. Mr. Aguirre pointedly established that Dick Murphy 's weren't searched either.

It seems that Mr. Levitt has convinced everybody (except Mr. Aguirre) that "our friends from the East", as Aguirre called them, can fix everything, that Levitt's connections can get everybody off the hook - for a price.

Levitt has a very high opinion of himself. He is a Washington DC veteran insider and says it will take the SEC several years to conduct their investigation.

So that is how this will work? The SEC, under the direction of their former chairman, will just let the investigation die of old age? Is that what Levitt and the SEC told the Council on Friday - in private? Is that worth $15 million of tax payer's money? The City Council seem to think so. They swallowed it hook line and sinker today.

Both Toni Atkins and Tony Young in their comments before the vote referred to this meeting with the SEC on Friday. Ms. Atkins even said that the SEC had recommended keeping Kroll Inc. It seems Levitt is very well connected indeed.

The trouble is, the SEC is not the only agency investigating the City. The FBI and the U.S. Attorney are also investigating. Was Carol Lam at that meeting? I doubt it.

Levitt, Mr. Fix-it from the East, also said he "had reason to believe" that there would be movement on the SDCERS waiver issue soon. Has he fixed that too? I noticed that Judy Italiano speaking on Item 500, pleaded with the Council to give Mr. Preovolos just a little more time. Is Levitt about to make that issue disappear too?

But there is an old saying: "facts are stubborn things". The fact remains that there WAS a quid pro quo in 2002, we DO have a real pension deficit and it did NOT all start with the election of Mr. Aguirre. Mike may still win - because his is right.

Items S-500/1/2 were continued to September 6th because Diann Shipione sent Toni Atkins this letter. Ms. Shipione wisely conditioned her participation on the removal of Preovolos and the other Dick Murphy  appointees. In other words she smelt a rat.



Ms. Atkins received Ms. Shipione's letter before the meeting started!
Evan McLaughlin posted it on the Voice of San Diego web site at

 
  08/07/05 - The City Council has to choose between themselves and Ewell: one of them has to go.  
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The City Council must either:
  1. Fire Lamont Ewell together with the consultants he hired: Vinson & Elkins, Kroll Inc. and Willkie, Farr and Gallagher.
  2. Turn over all investigations to the SEC and the U.S. Attorney, Carol Lam.

Or face severe consequences e.g. obstruction of justice charges.

Everything will end up in the SEC and U.S. Attorney's office anyway.

Ewell and his army of consultants were hired to cover up for Murphy and whoever controlled him, probably Judy Italiano and Ann Smith.

The people have elected a competent City Attorney, Mike Aguirre, who can represent the City before the SEC and the U.S. Attorney. Those who have done wrong will be punished and those who did not will continue their excellent services to the City.

It is either Ewell or the whole City Council. Their last chance to choose will be on Tuesday. The people will not stand for this any longer.

Ewell said on June 28, 2005 (select Item 203) that we must continue to pay KPMG so they can sit in on all the conversations between Vinson & Elkins and Kroll. He is telling us that these guys can fix this, but it will cost us - plenty.

How can we conclude other than that they are all engaged in a massive cover-up or worse? What's a million dollars between friends?
$15 million is an awful lot of money to be sloshing around in the City Manager’s Office, where they all have their offices.
 

 
  The San Diego Union-Tribune needs to think again - 08/05/05  
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Anybody watching this exchange (select Item S-408) in the City Council Chambers on August 1st, would see that the editorial board of the San Diego Union-Tribune has it wrong with regard to the controversy between Aguirre and Ewell.

It is bad enough that all but two of the remaining City Council Members, Donna Frye and Brian Maienschein, have joined the City Manager and the MEA leadership in seeking to cover up the financial wrongdoing this city has been subjected to, but the Union-Tribune are now siding with City Manager Lamont Ewell.

I can only assume that their motivation is political. They fear the growing influence of Donna Frye and Michael Aguirre and an end to the power structure that has ruled this city from the golf course at the Rancho Santa Fe Country Club.

The saddest part of all is that Toni Atkins is clearly part of this inner group - or wants to be. Several times she used her chair to suppress Mr. Aguirre's probing questions.

Donna Frye deserves enormous credit for the cool way she exposed the "interactive" clubbiness in the City Manager's 9th Floor suite. She and Mr. Aguirre totally outclassed the best brains of the combined forces of the City Manager's Office, the sycophancy of the Toni Atkins' "wannabes" and the legions of Ann Smith and Judy Italiano's obedient servants on all floors. Donna and Mike were magnificent.

The Union-Tribune are now desperately trying to obscure, in a mushroom-cloud of editorial bombast, the damning revelations inadvertently made by Audit Committee member Troy Dahlberg, who came before the City Council on Monday for what he thought would be a "routine" Council waiver of attorney-client privilege, completely unprepared for the legitimate and searching questions of Frye and Aguirre.

Damning revelation number one is the "interactive" nature of the relationship between Vinson & Elkins and the so-called "outside independent" Audit Committee; damning revelation number two was that the binder toted by Mr. Troy Dahlberg into the Council Chambers contained what he described as a "draft" memorandum of written conclusions by Vinson & Elkins - "draft" because the "interactivity" between the two "independent" bodies had not yet decided on its final form under the supervision of Ewell and Atkins on behalf of the MEA and its pension board appointees.

The leader of this three member Audit Committee (appointed by Dick Murphy ) is Lynn Turner former chief accountant of the Securities and Exchange Commission. He should be ashamed of himself. The two others are former SEC chief Arthur Levitt and Troy Dahlberg his colleague at the international financial consulting firm Kroll, Inc..

Atkins and four other City Council members imagined they could give the Audit Committee and Vinson & Elkins the waiver they needed to comply with subpoenas from the various investigative bodies but keep it all secret from the public. She is proving herself a worthy successor to Dick Murphy  and Susan Golding.

Despite the fact that the Council voted to waive privilege on the Vinson & Elkins report, in a letter to the Union-Tribune today Lamont Ewell accused Mike Aguirre of releasing "
a confidential, draft report prepared by the firm Vinson and Elkins regarding certain financial issues". That is dishonest and the U-T knows it.


On the basis of what I watched on the above streaming video link on Monday (which I would urge anybody interested in the affairs of this city to watch at least once), I would urge the editorial board of the San Diego Union-Tribune to take another look at the question of whether the Audit Committee, particularly, the two members from Kroll Inc., are as independent as the U-T asserted in its August 4, 2005 editorial.
 
 
  The first of many - 08/04/05  
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Bruce Herring has saved Donna Frye the trouble of firing him when she becomes Mayor. She has often said it would be the first thing she would do on taking office.

It is only a matter of time before many more join Herring "moving on to other aspirations". Don't let the door hit you on the way out Herring. Hope you find a good attorney. Use your DROP money to pay his fees - before it gets rolled back..
 
 
  The battle lines between Aguirre and Ewell - 08/04/05  
 

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The battle lines between Aguirre and Ewell are drawn:

  1. Aguirre asserts that this Resolution passed by the City Council on November 18, 2002, to "defend, indemnify and hold harmless" the 6 city employees who sat on the pension board, is illegal.
     

  2. Ewell re-asserts its legality and relies on its clause: "in the event the City Attorney for the City of San Diego is unable or unwilling to provide such defense, the City shall pay for any and all costs and expenses of a Board Member related to such defense, which obligation it may satisfy in its sole discretion by engaging outside counsel at its sole expense."

    He further cites City Charter Section 40 as his general authority to hire outside counsel: "The Council shall have authority to employ additional competent technical legal attorneys to investigate or prosecute matters connected with the departments of the City when such assistance or advice is necessary in connection therewith."
     

  3. Aguirre asserts that Section 40 only confers authority to employ "technical" attorneys, when the City Attorney would not reasonably be expected to have such technical expertise. This was not the case with respect to the pension.

Who is acting in good faith? Aguirre? Ewell and his City Council cohorts? It all comes back to what is at stake and that brings us back to Judy Italiano and Ann Smith. Ewell is just the "fool in the middle". This is a battle for the very soul of San Diego - who is running this City - the city employees or the people, through their representatives.

Yesterday's Council machinations was an attempt to ratify the November 18, 2002 Resolution. It was narrowly defeated by Donna Frye and Brian Maienschein (I think I will send Brian a personal "thank you" email).

This is the eye of the storm. If the 6 city employees go down, Ewell and the entire Council go down. So do the city employees unions. The stakes could hardly be higher.

Will Judy Italiano and Ann Smith use MEA funds to defend the "Pension 6"? The 4 City Councilors who sided with Ewell yesterday now have big legal problems of their own - they are clearly guilty of having tried to circumvent the City Attorney.
 

 
  Donna needs to disassociate herself from the sinking ship that is City Hall - 08/03/05  
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As a Donna Frye supporter I would urge her to get the hell out of City Hall. It is a political death trap. It will end every political career (including Atkins who thinks her present position will propel her to higher office), eventually they will all have to resign.

I want to see Donna completely disassociate herself from that nest of corruption by withdrawing her entire Council staff to a building in her own District. I am sure there are lots of Clairemont or Mission Valley landlords who would love to have her. She can serve her District much better and safer away from the machinations of City Hall.

I don’t know if that is legal or not but it certainly should be. As I understand it she has a budget of around $850,000 per year and she should be allowed to spend it any way she wishes as the people’s representative.

Donna showed great leadership last year in refusing to attend closed-session Council meetings. She smelt a trap back then and she should smell one now. They are all scurrying to save their skin, all but her. Even Tony Young was a staffer for much of it. Downtown is like a volcano ready to blow; she will go up with it if she doesn't get out.

Look at Sanders’ web site. He has posted this “Voice of San Diego” article dated yesterday. Scott Lewis quotes Diann Shipione telling how she and Frye missed some of the trap set for approving the underfunding of the pension system in 2002: "It was another game played by city manager and staff to trick those of us trying to prevent this underfunding scam." The City Manager and staff had buried the items so deep in the “Consent Agenda” that neither Shipione, Frye nor Frye’s staff caught it.

It shows how deadly City Hall can be. Donna needs to send a very strong message to the electorate that she is not part of that vipers' nest of corruption and manipulation.

If she doesn't, by November 8 Jerry Sanders and his sidekick "
Ronne” Froman will make it look like it was Donna Frye who was Mayor when all the dirty deals were done not Dick Murphy . They will tag her with every evil deed while he gets away scot-free.

How do I know that? Because the exact same people who backed Dick Murphy  are backing Sanders. Look at his contributor list. Donna, you are in mortal danger.
 
 
  Where is our outrage? - 08/03/05  
 

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This is what Moody’s had to say about us yesterday: "(there is) significant uncertainty (regarding management, investigations and release of audited financials) as to when and how these will be addressed.

It was linked to this story in the Union-Tribune whose separate editorial today ends with "
The question now is, how much closer to the brink of financial ruin will San Diego slide before the City Council takes real action to curb skyrocketing pension benefits?" Indeed!

The “significant uncertainty” is costing loss in portfolio value to the holders of our bonds - their investments are becoming worthless - they will never invest with us again.

How did the City Council deal with this “significant uncertainty” charge yesterday?

They released a 118-page report dated July 15th by their lawyers Vinson & Elkins, saying that the City Council has done nothing wrong. They had been keeping it for exactly this situation. They are only interested in saving their own skin.

Another story in today’s Union-Tribune is informative: ”The city hired Vinson & Elkins to investigate its disclosure practices in February 2004. It is also representing the city in talks with the SEC. Kroll was hired a year later to mediate between Aguirre and Vinson & Elkins.”

It goes on: “… Ewell countered (Aguirre) that the consultants, who work out of two offices on the same floor of City Hall as the manager and his staff, are so independent that the locks on their work space were changed and only they have the keys.” Sure Lamont, that makes them independent.

We have paid (in service cuts and potholes) for these “outside consultants” (effectively working out of Mr. Ewell’s office) to the tune of $12 million! Where is our outrage?
 
 
  This is going to be a tough city to win back for the people - 07/30/05  
 

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In a Union-Tribune interview today, Toni Atkins says:
"I need to have people on my transition team that help me feel comfortable and focused on what I've got to do over the next four months."

So now we know where Toni feels "comfortable" – with insiders like: Kevin Tilden, Michel Anderson, Bob Nelson,  Nikki Clay, Dave Watson, Jane Potter, Paul Grasso and Denise Price.

Anybody familiar with San Diego City politics will recognize all of these right away as long time lobbyists and council staffers - the ultimate insiders. People like these have been making decisions for this City for years – on the inside. That is where Toni herself comes from - Christine Kehoe's staff. She is keeping it all in the family.

The U-T asked Donna Frye for her comments. She pointed out the obvious, that three of Toni’s transition team – Michel Anderson, Nikki Clay and Dave Watson – are registered lobbyists with the city and noted that there were no “community” people. Indeed! Unlike Donna, Toni is much more “comfortable” with insiders.

Speaking of filling the four vacancies on the pension board (which apparently she now hopes to docket on August 8 or 9, if the unions are ready, that is) Ms. Atkins said “she would not make the waiver a litmus test for prospective board members.” Sadly we already know what the outcome of Toni’s pension board appointments will be: the same as
Dick Murphy ’s. Because the same union bosses will pick "safe" appointees.

Mike Aguirre likened it to not asking “if you'll uphold the law if you're appointed to a judgeship”.

In case there was any doubt about where Atkins stands, she proceeded to parrot Ann Smith, calling for “the leveraging of city-owned property, the issuance of pension obligation bonds, the institution of a pension tax, or the shift of the city's retirement fund to the massive California Public Employees' Retirement System.” No mention of roll-backs or anything nasty like that, Ann Smith would eat her alive.

Donna Frye on the other hand “wants expedited court hearings to determine whether previously approved benefit increases to fund beneficiaries are illegal and to decide the waiver issue.” No union votes there for Donna.

Donna could be in the Mayor’s chair right now if she had sold herself to the unions as Atkins is obviously willing to do, and as
Dick Murphy  did before her.

Sanders said he “is not troubled by her transition team.” Of course not. Some of them are on his contribution list!

And he will eventually make a pact with Ann Smith, like Golding, like
Dick Murphy
, like Zucchet, like Atkins. He (and Tom Shephard) knows it is the only way he will become Mayor. That is what he meant on the campaign trail by "bringing them to the negotiating table". Jerry is a "realist". Let's hope Donna never becomes one.

This is going to be a tough city to get back for the people. But we must try.
 

 
  Ann Smith is the real Mayor of this town - 07/29/05  
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Joan Raymond, president of the American Federation of State, County & Municipal Employees (AFSCME) Local 127, a union representing 2,100 city of San Diego workers in maintenance, labor, skilled trades and equipment operator units wrote an op-ed piece in today's Union-Tribune. It could be the first crack in the dam.

She called on the Pension Board to waive attorney-client privilege: "Let's open the doors, turn over the books and fully cooperate with the auditor."

Fear of receivership no doubt drove her to write: "Delays in a decision to waive privilege have some people calling for placing the pension fund into receivership where a court-appointed trustee controls the system. Under receivership we risk losing control of our future and face a protracted and expensive process that may do more harm than good." She rightly fears losing control.

Ms. Raymond is the first union leader to break ranks on this issue.

Not so Toni Atkins. She cannot find space on the Council Docket for an Agenda Item filling the four vacancies on the Pension Board. She must wait until Ann Smith, Judy Italiano and Ron Saathoff find four more shills who can be relied upon not to waive.

The unbelievable reality is that the Mayor does not even control the Council Agenda. The MEA does, through Mayoral Office insiders like Colleen Windsor. That is why the City Council appointed Atkins, she was the unions' choice. They had no say in it.

Dick Murphy
 may be gone but nothing has changed - the union bosses tell our elected representatives what to do. Ann Smith is the real Mayor of this town.
 
 
  Redevelopment and quid pro quo - 07/29/05  
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Finally somebody with muscle power is speaking out against redevelopment abuse. The County is suing San Diego City over Grantville.
"In short, the county accuses the city of forming the redevelopment district just to get the extra tax dollars it brings, without proving that conditions there are bad enough to justify it."

The County claims that the loss of its share of property tax will put a "severe strain on the county's ability to provide needed public health and safety programs throughout the region,". It puts a similar strain on the City's finances because "the extra tax dollars" do not go to the city as a whole but to the redevelopment project.

Forming redevelopment areas is like taking steroids. It pumps up a favored area at the expense of the health of the athlete/city. In this case it pumps up Jim Madaffer's District while, to paraphrase the County, putting "a severe strain on the city's ability to provide needed public health and safety programs throughout the rest of the city".

Madaffer's assertion that forming a redevelopment area is the "only way" to cure whatever problems they have conjured up to justify forming the project, is wrong. Any problems that may exist will be fixed with borrowed money either way. The City can borrow at the same or better terms than a redevelopment project.

So why do they do it? Simple - to retain revenue in their Districts. Forming the Grantville  redevelopment project retains substantial tax revenues in Madaffer's District. He doesn't care about the rest of the city. That's the root cause of the problem.

In supporting the Grantville project in May, Scott Peters said from the Council bench that while he had no redevelopment areas in his own District, he understood why Madaffer and others supported them - to retain revenues in their Districts.

He openly admitted their motive was selfish. He should have argued on behalf of the rest of the City. But Madaffer supports him on other issues - the old quid pro quo.

The next mendicant City Council Member who is foolish enough to propose a redevelopment project for their District will be answered by a mass City Hall invasion of angry residents and small business owners. The "New London" decision is the "Roe vs. Wade" of eminent domain. The people are alerted.

In fact the Grantville project may yet fail. It is currently only a "Study Area".
 
 
  What is Aguirre playing at? - 07/26/05  
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Perhaps it was only human for Toni Atkins not to share her moment of glory with anybody yesterday, but politically it was a big mistake - she did not "docket" the November 8th election ordinance.

We all know that the elections for Districts 2 and 8 will be held on November 8th and most know that the last day for filing nomination papers (88 days prior to an election) is August 12th. But that is not the point, especially if you happen to be a candidate.

A candidate cannot "take out" papers or start a campaign until the City Council passes the enabling ordinance (which Atkins now says will be on the docket next Monday, August 1st). The point is: that leaves very little time for grass-root candidates to get the necessary 800 nominating signatures, which is unfair. Why did she do it?

"You should have put the election ordinance on today’s docket, not waited until you are ready. The Citizens are ready now. You Ms. Atkins told the media last Friday that your docket was “too packed” today", Mr. Agee from Point Loma (go to "Non-Agenda Comment") told the City Council yesterday at public comment. He told them: "you still don't get it".

They definitely did not get what Agee was trying to tell them.
Aguirre backed Atkins! He said Agee's concerns would be answered next week, when the ordinance would be on the docket. He reiterated Atkins' lame excuse that the docket was too full.

Either Aguirre "didn't get" Agee's point about the time-squeeze or he is now cozying up to Atkins and the rest of the City Council. He offered: "The candidates are already out there doing what candidates do". They are not! They are prevented from doing so as a matter of law. What is Aguirre playing at?

If he is not now covering for Atkins and the Council he owes Mr. Agee an explanation. He should have joined Agee in condemning the City Council's deliberate manipulation of the Docket to time-squeeze grass-root candidates.
 
 
  Today's U-T hit piece on Donna Frye - 07/25/05  
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Bob Kittle and the Union-Tribune are back in form. Kittle saved his hit piece on Donna Frye for this morning, the day before the election. It was not enough for him to endorse Sanders he had to go negative on Donna. More than City Hall needs changing around this town, we need a real newspaper, not just a right wing echo chamber.

Kittle says Sanders would "bring a proven moral compass to an ethically challenged city government". A moral compass? Tell that to the two survivors of the McDonald massacre, Ronald Herrera and Albert Leos, who criticized Sanders for taking too long to shoot Huberty. It took 77 minutes!

During that period 21 people, mostly children, died while
Lieutenant Sanders ensured that he and only he got to go before the TV cameras when Huberty was finally shot.

Mr. Kittle conveniently ignores this report in his own newspaper dated July 22, 1984 four days after the massacre:
"SWAT commander Lieutenant Jerry Sanders, 34, was sipping a beer at the Salmon House in Marina Village, attending a birthday party for a fellow commander. About 25 minutes after the first call went out for SWAT help, Sanders was approached by deputy chief Norm Stamper, who just got off the phone. 'Have you been beeped yet?' ". On July 26, 1984 the same newspaper reported that Sanders was "still trying to determine why his pager failed to work."

The July 22 article continued: "He quickly hopped into his squad car and headed for the scene. While en route a message came in on his radio: 'The green light is on.' The order had been issued to kill Huberty. Sanders pressed his transmitter button, countermanding the order. 'This is the SWAT commander. That's a negative on the green light. There's a red light' -- no firing permitted -- 'unless he leaves the building."

Are these the kind of "tough decisions" we can expect from Sanders? That must have been a tough decision all right, he has had to live with it ever since.

Not content with burying Sanders' dark personal secret, Kittle continues to do the job for which the U-T pays him, a Roger Hedgecock-style hit on Donna:
"She deserves enormous credit for her campaign to eradicate the culture of secrecy at City Hall. But otherwise her leadership has been mostly confined to opposing any and every initiative to come before the council."

I suppose "any and every initiative" includes the only "opposing" vote against the illegal pension benefit increase, which was backdated for the benefit of Sanders et al., a benefit increase which 26 year pension recipient Sanders would undoubtedly have enthusiastically supported if he were in her place at the time, a benefit Mr. Sanders will undoubtedly fight to retain against Donna's current efforts to roll it back.

Mr. Kittle's remarks regarding Francis  best describe the unworthiness of his own remarks regarding Frye: "But Francis' last-minute hit pieces targeting Sanders and Frye – often with grossly misleading information – has sullied his standing as he seeks to make a high-level entry into San Diego politics."

Today's Union-Tribune hit piece on our next Mayor sullies the standing of our only daily newspaper in San Diego and we are all the poorer for it. Shame Mr. Kittle.
 
 
  What is Toni Atkins playing at? - 07/22/05  
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What is it about this town and power? Toni Atkins was not in the Mayor's chair five minutes before going on a power trip. Two Council Members resign this week and as Mayor pro tem she decides NOT to docket an ordinance setting an election date for their replacement on Monday's agenda
. Here is the closed session agenda:
  1. Brown Field Aviation Ventures v. City of San Diego
  2. De Anza Cove Homeowners Association, Inc. v. City of San Diego
  3. San Diego City Employees’ Retirement System v. San Diego City Attorney
  4. William J. McGuigan v. City of San Diego
  5. Michel A. Kozak v. City of San Diego
  6. People of the State of California v. Grissom
  7. Barrett American, Inc. v. City of San Diego
  8. California State University Board of Trustees
  9. Regional Water Quality Control Board San Diego Basin Plan.

The first item on the Agenda should have been to ask the people of District's 2 and 8 who they want to represent them on the City Council, that's what elections are for.

Ms. Atkins has demonstrated a total disregard for the people's will in deciding that the above items are more important than setting a date for the people to elect two Council Members. Nobody can seek nominating signatures or file papers until the Council passes an election ordinance. Is she deliberately rigging it against "outsiders"?

This article in today's San Diego Union-Tribune quotes her: "Atkins said the agenda for Monday's City Council meeting is too packed to consider calling for a special election Nov. 8 to replace Inzunza and Zucchet, and Tuesday the council won't meet because of the special election to replace Mayor Dick Murphy , whose resignation took effect last Friday."

The agenda is too packed! It goes on:  "Atkins has been supervising the management of the two council districts' offices and said the former councilmen's staffs are saddened but dedicated to doing their jobs."

There are several qualified outsider candidates lining up to run for Districts 2 and 8. Does Ms. Atkins want to give insiders like Ana Molina, Inzunza's chief of staff the "inside" advantage? She herself was chief of staff to Christine Kehoe. They like to keep it in the family down there on the 10th Floor.

We need to end this "hand-me-down" culture of Council Membership. These "insiders"  have a stranglehold not only on the top City jobs but on the elected offices as well.
 

 
  We do not want our City to become a tangle of public/private LLCs - 05/21/05  
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I have on a number of occasions over the past few years suggested to some of our developer-friendly City Council Members that they pass an ordinance requiring all entities who enter into a business relationship with the City, be entirely constituted under California law. It was like suggesting detox to drunks on a bender.

In other words I was suggesting no more Delaware or Nevada LLCs - we want to know where to find you if something goes wrong.

You would think that would be the norm wouldn't you? Far from it.

Many of the City's Redevelopment Partners like Corky McMillin in the NTC, do their deals with the City using Delaware LLCs. What happens when something goes wrong, like mold in the Liberty Station condominiums? We the citizens are left holding the bag.

Now we have a mayoral candidate, Steve Francis, who loves Delaware LLCs so much that he owns his own home in Fairbanks Country Club through one of them.

It is all a matter of accountability. I can understand any businessman wanting to shield his personal assets from business liability. But doing business with a city is different. We the citizens are not out to make a profit, we just want services. We have a right to insist that if you do business with us you are willing to be held accountable.

Should we not start with our Mayor? I think so. We should ask Francis to be open with us about his current businesses or else give them up. No more LLCs. We do not want our City administration to become a tangle of public/private LLCs. We must have the courage to ask the right questions of our candidates, starting with Francis.
 
 
  We will have nobody to blame but ourselves ...  - 07/20/05  
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On June 28th (Dick Murphy 's last day at City Council) Zucchet promised him an "appropriate" send off on July 18th, when Michael would have the chair.

What could be more appropriate for Dick Murphy  than a guilty verdict against his chosen successor? It was like San Diego was saying "and the horse you rode in on Dick".

Not since Steven Spielberg's Tyrannosaurus Rex destroyed San Diego in The Lost World: Jurassic Park has our City looked so bad - and that was in the movies! What kind of political Tyrannosauras came through here over the last few years?

Inzunza and Zucchet had no intention of resigning until Mike Aguirre pointed out that under the Charter they could be removed as early as next Tuesday July 26th, for non-attendance, and State law prevented them from attending any more Council meetings.

I wonder how Inzunza's kitchen crockery is holding up. At least Zucchet had the good grace to bawl like a baby in public. But he still doesn't get it. It must be tough watching
Dick Murphy
 and others getting away with everything while he gets caught on a teeny-weeny little bribe. It just ain't fair.

Maybe they will both write their memoirs from jail and one day we may learn who owns which Delaware LLC or which holiday home in places like Shannon, Ireland.

It is up to us citizens now. This is our City. We can start by checking this guy Francis out. Who can blame him for thinking the pickings were easy in San Diego. They were!
 
 
  Mr. Francis needs to explain some things to us - 07/19/05  
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We made it to the Jay Leno show tonight: Jay said there is better job security as the Prime Minister of Iraq than as Mayor of San Diego and that our City Councilman Michael Zucchet took his bribes one dollar at a time, stuck in his thong by a nude dancer. Things will never be the same in this town.  Now a politician cannot even take a discrete dollar in his pants - the end of politics as we know it.

Maybe that's why the Republicans in San Diego are so badly split. What Republican wants people like me snooping into their personal finances? Murphy's job was to keep us at bay, but now he's gone. Will Republicanism in San Diego survive the light of day?

The Republican Party endorsed Steve Francis while the Union-Tribune endorsed Jerry Sanders. Sanders' support is collapsing according to a new poll. Backers like Tom Stickles must be disgusted. Even Tom is no match for Doug Manchester AND Corky McMillin. They bought the San Diego Republican Party with massive contributions! Add to that John Lynch's radio station screaming abuse at anybody to the left of Attila the Hun and traditional Republicans like Tom Stickle start to look like Jane Fonda.

Tom closed my very first home loan as a mortgage broker back in 1982 when he was a very young President of Point Loma Savings & Loan, newly opened at the corner of Midway and Rosecrans, and I was an eager-beaver Century 21 real estate broker who wanted it all. Stickles is now Sanders' business and banking mentor. Tom must be wishing he had stuck to banking and Sanders that he had stuck with the Coronado First Bank project - I might even have brokered a loan with them.

Now along comes Steve Francis with more money than David Dominelli. They say politics is the last refuge of a scoundrel. Is Francis a scoundrel? I sure hope not, the last thing San Diego wants now is another scoundrel. So who is this Francis guy?

Let's start with Don Bauder's article in The Reader last week. Don can smell a con artist from the other end of the County. He doesn't seem very impressed with Francis' "financial engineering" at AMN Healthcare Services, the company Francis manages.

So I did a little investigating in my own area of expertise, real estate.

On March 3rd 2003 Mr. Francis paid $6,450,000 cash for his present home in Rancho Santa Fe, pretty nice digs.

This cash purchase coincided with the "financial engineering" Mr. Bauder wrote about in his Reader article. Francis did not sell any other property in San Diego County about this time nor did the purchase have a concurrent mortgage. A combination of these two is the usual source of funds for such a purchase.

Francis does not own all of AMN, which declared a profit of $17.3 million last year. Where did Francis get the $6,450,000 cash? It hardly came out of the Company's profits. And where is he getting the million or more he is pouring into the mayoral race? I think it is a little more complicated than Mr. Francis would have the voters of San Diego believe - that it all comes out of the very successful Company he owns.

Mr. Francis holds title to his Rancho Santa Fe home through SGAK Properties LLC, a Delaware Limited Liability Company.

I just think it would be helpful if Mr. Francis explained all this to us, now that he wants to be our Mayor. Having a lot of cash stashed in a Delaware LLC always raises suspicions of laundering. That may be the norm in business but not in politics, especially at this point in San Diego's history.
 
 
  I wonder how many San Diegans really “get” what's going on - 07/17/05  
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Jerry Sanders would be “The Developers’ Mayor”. His interview in today’s Union-Tribune Insight Section must be read in conjunction with his campaign contributor list, which is a “Who’s Who” of San Diego developer interests. No doubt they are all sending him congratulatory emails this morning. He is saying what they want to hear.

To Jerry and his fellow developers/bankers (he is on the board of The Coronado First Bank, in organization), government should be one big public-private partnership, with the public partner paying all the bills and the private partner raking in the profits.

Asked if San Diego needed a new City Hall: “I don't know. It is a beautiful structure. That's a pretty valuable piece of property that's being tremendously under utilized. It's not something that's going to be done in the next year or two years or three years, but I think we need to look at a public private partnership on that piece of property.” Why waste such a nice building on government? Privatize the lot!

And Ronne Froman will do it all for him, while he has a grand old time in the best hotels of New York and Washington lobbying for "infrastructure" money for his developer friends - on our City’s credit card:

He says: “She'll be the chief operations officer for the city. She'll basically start running the city operations. That will allow me to go back to Washington to lobby for money for infrastructure, for roads. To talk in New York with Wall Street about why they should invest in San Diego, why our credit rating should be better, what our plans are. She'll allow me to be in Sacramento lobbying for our fair share there, which we have been shortchanged on for so long. Nobody can remember when it was fair. And we hear talk about it all the time, but nobody's left the city. It requires relationships and it requires repeated visits. And bringing a coalition around of other mayors.”

He thinks Dick Murphy dropped the ball - for the developers that is.

But as their new man Jerry will turn the entire city into a giant network of public-private "redevelopment projects" under the banner “City of Villages”, a concept Murphy never quite “got” (according to Jerry) and the developers finally lost patience with him.

So, let the great Sanders sell-off begin, starting with City Hall (appropriately enough). I wonder how many San Diegans really “get” what's going on in their city.
 
 
  Donna has the vision; let's hope she can implement it - 07/15/05  
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There is a great interview with Donna Frye in today's Voice of San Diego.

She says: "I would like (San Diego) to be a national model for good government and be able to take that message, not just statewide but national ..... It's our government. The people are the government. So I would like to bring them back into that process. I would just like us to be the most open and ethical government that sets a national model. That would make me so proud."

She wants to actually make democracy work: "To me, the thing that makes government work and makes it effective is the public involvement and the public's excitement, enthusiasm and optimism and wanting to come down and do things and be on boards and commissions".

You can see how her mind is working when you hear her speak so passionately about combining her two most urgent tasks: the budget process and re-engaging the people.

Instinctively she knows that the way to engage the people in governing their city is to go over the numbers with them. That is very powerful: if we all know everything about our city, together we will do the right thing to fix it.

With a strong people's mandate and six Department Secretaries drawn broadly from people across the city, she can do it. If her six Secretaries share her drive and passion, fan out into the six Divisions into which she has divided the City Government, they will quickly implement her vision for San Diego. It can be done.

I just hope her democratic vision does not get strangled by a few obstructionist old civil servants who will inevitably resent this bunch of "amateur civilians" poking into their cozy little world. But some, I suspect most, will welcome it. It is their city too.

It will be like having a Donna in charge of each of the six major Departments. But they must think as she does: absolutely believe in democracy and open government.

I see great strengths in this Secretariat system in that multi-faceted issues will be dealt with in the department each facet belongs e.g. the land use aspect of the Chargers issue will be dealt with in the Planning & Land Use Department while the sports aspect of it will be dealt with in the Arts & Culture Department. The various facets of each issue are then reconciled by the Mayor and six Secretaries at Cabinet level, including the omni-present Secretary of Finance. That's how governments work around the world.

The key for Donna will be to get like-minded Secretaries in each Department, who will reach out to the people in the manner she so passionate advocates, by holding town-hall meetings in the Districts to discuss the hot issues. This is another great strength of the Cabinet Secretary model, the people will know the person before them is Donna's Deputy and has her trust, not just some faceless civil servant. The political aspect of their job is as important, even more so, than the administrative, which can be "staffed".

The answer was there all along: democracy. It will be an example to the whole country.
 
 
  Jerry Sanders and the McDonalds massacre - 07/14/05  
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Thank goodness for The Reader. Read this article in last week's edition about Norm Stamper's new book: "Breaking Rank draws on incidents Stamper experienced or witnessed in both Seattle and San Diego. But it does not mention the July 18, 1984, McDonald's massacre in San Ysidro, which ended when a SWAT team sniper, Charles Foster, from a nearby rooftop, shot Oliver Huberty in the chest, killing him instantly."

That is like Joe Di Maggio writing his life story and forgetting to mention that he ever played baseball! The McDonalds massacre dwarfed every other San Diego crime for decades before and after. It was San Diego's 9/11. Why the secrecy by the boys in blue? It seems to me that Stamper's book is misnamed, it should be Keeping Rank.

Has anybody interviewed Charles Foster? Could he have taken the shot or not?

Two survivors, Ronald Herrera and Albert Reos criticized the police for taking too long to shoot Huberty. They say he was still killing people 40 to 45 minutes after entering McDonalds.

Something is not right about Sanders' story. If he wants us to trust him as Mayor he should come clean about everything that happened on July 18th, 1984. Why is nobody asking him about this on the campaign trail? It suggests a different meaning for Joe Deegan's title "Fear Tracer": are we afraid to ask hard questions of our own police?
 
 
  Reinventing City Government - 07/13/05  
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Today we got our first look at Donna Frye' organization chart for City Government.

She will have a Cabinet modeled on the Executive Branch of the Federal Government. This has the great advantage of being readily understood by citizens.

She will appoint six Cabinet Secretaries:  Finance, Public Safety, Public Works, Arts & Culture, Planning and Land Use, and General Services. By combining the Mayor's and City Manager's Offices and flattening out the old "lumpy" functions she will realize many efficiencies while reducing the existing staff by 22%!

This is the old chart. It had become disjointed.

Ms. Frye's logical grouping of related services into six Secretariats will not only be more efficient, it will make it easier for the average citizen to interact with City government. The Secretariats will be less bureaucratic because they will each have a "civilian" head.

Civilian Secretaries making departmental decisions and taking collective responsibility as a Cabinet has been tried and proven around the world. Can you imagine a General in charge of the Department of Defense?

The Chief Executive listens to spirited arguments by the various Secretaries on behalf of their respective departments before deciding priorities and allocating scarce resources.

It will neatly answer Donna's requirement for accountability. Each department must provide her (and the people) with a clear comprehensive monthly financial report. It would be impossible for a Secretary to effectively represent his/her Department in Cabinet without one. Clarity and transparency will be an integral part of the system.

Because Cabinet Secretaries share political praise and blame they will tend to act in the best interest of the city as a whole, by constructive give and take.

They should serve at the pleasure of the Mayor and be "civilians". If they were permanent civil servants they would not have credibility with the people. They should come and go with their boss. They are the Mayor's deputies but, like the Mayor, they do not have permanent jobs. They reflect the philosophy of the incumbent Mayor.
 
 
  The unions will lose this argument - 07/12/05  
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The City of San Diego hired Bill Kay, a San Francisco labor lawyer, to stage an elaborate series of phony “negotiations” with the city’s unions. He then granted them (the City ratified it) a three year labor contract cleverly designed to bury Murphy's 2002 dirty ballpark/pension deal under a mountain of labor law.

Kay was paid $450,000 for his services and advised the City that benefits once granted cannot be revoked no matter how illegal. He solemnly assured union members that even if their leaders are found guilty of illegal acts, the benefits they obtained though illegal, are “individually vested”, which means that every employee may sue to retain every granted benefit, illegal or not!

This means that if a union chief robbed a bank and gave the proceeds to his union, while he personally may go to jail, the members could keep the loot, according to Mr. Kay that is. 

I wonder what law school Mr. Kay went to or what he is smoking. According to him the offspring of collective bargaining is above all law, even the Constitution.
 
 
  Look out San Diego, the times they are a changin' - 07/10/05  
 

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The clarity and honesty of Donna Frye’s answers to the U-T editors today is both refreshing and reassuring. Those who doubt she has the intestinal fortitude and the ability to tackle the City’s problems should study what she has to say.

The fact that she understands the need for a strong mandate shows that she knows the issues will be very tough indeed - “if I'm elected that is a great indication of where the public is”. This is not a lady going in there for a nice time, cutting pretty ribbons and smiling for the cameras, she means business.

Sanders’ circle of friends betray the fact that he is already an integral part of that cadre of developer and public employee interests that has secretly ruled City Hall since 1996 through Susan Golding and Dick Murphy and who now want to continue their rule through Sanders, so the lines of battle are clearly drawn.

I love that she will bring in Pat Shea and “give him a title”. How about "The Terminator"?
Pat says the bankruptcy court is the one place where everything comes together. He is wrong, there is a better place - Donna's Mayoral Office. It will be presided over by a higher Judge, appointed by the highest authority in the land - the votes of the people. Donna is all he needs.

Whatever role she gives him however he will need to leave his lawyer badge at home. Donna already has a lawyer, the best - Mike Aguirre - again, appointed by the highest authority in the land - the votes of the people.

One of the few people who got the measure of Donna early on was John Kern. I bet he would just love to be her Chief-of-Staff, she is so much ballsier than Murphy and Kern loves ballsy people. But Kern was part of the problem not the solution.

Look out San Diego, the times they are a changin'.
 

 
  Summary of Mike Aguirre's Lawsuit - 07/07/05  
 

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The Defendants:
(1) Lawrence Grissom; (2) Ronald L. Saathoff; (3) John A. Torres; (4) Sharon K. Wilkinson; (5) Terri A. Webster; (6) Cathy Lexin; (7) Bruce Herring; and (8) Loraine Lee Chapin. 

The Charges: “Under Govt. Code § 87100, the defendants at all times alleged in this complaint had a duty not to make, not to participate in making, or not to in any way attempt to use his/her official position to influence a governmental decision in which he/she knew or had reason to know he/she had a financial interest.” 

The 87100 Code:“No public official at any level of state or local government shall make, participate in making or in any way attempt to use his/her official position to influence a governmental decision in which he/she knows or has reason to know he/she has a financial interest.” 

The Problem: Under the terms of the 1996 and 2002 City Manager’s proposals known as MP-1 and MP-2, the City of San Diego agreed to increase employee pension benefits without providing the funding needed to pay for those benefits.

An unfunded liability was created for which the City of San Diego was to be responsible and for which revenues from future years would pay. The creation of such liabilities for which same-year City of San Diego revenues were not available violated the liability limits of San Diego City Charter § 99 and California Constitution Article 16 § 18.”

Additionally in MP-2 “defendants Saathoff, Lexin, Torres, Wilkinson and Webster agreed that in exchange for more illegal benefits for defendants and others, these defendants would agree not to enforce the City of San Diego’s covenant under MP-1 to make the balloon payment if the SDCERS pension plan’s asset to liability funding ratio fell below 82.3%.”
 

Aguirre's Argument: that there was a quid pro quo contract: According to their own terms MP-1 and MP-2, the interrelationship of the various parts to each other necessitated that the entire proposals be considered and acted upon concurrently”;  that the defendants’ would or would not receive illegal benefits depending on whether it was approved or rejected by the SDCERS board of trustees” and that their action was not necessary or required because there was no necessity or requirement that the SDCERS board of trustees adopt MP-1 or  MP-2”. 

The Damage: "As a direct and proximate result of the defendants’ unlawful conduct, the SDCERS pension has suffered irreparable injury. From 1997 the funded ratio of assets to liabilities of the SDCERS pension fund has dropped from 93.3% to less than 65.8%.

During this same period the City’s contribution has increased from 8.71% of payroll to greater than 26.86%. Despite the significant increase in the City’s contribution to the SDCERS pension fund, the unfunded liability has increased from $116,507,000 in 1997, to in excess of $1,368,648,000 in 2004 -- an 1100% increase.

A significant and material part of this increase in the unfunded liability of the SDCERS pension fund was a direct and proximate result of the unlawful and unfunded pension benefits created as a result of the MP-1 and MP-2 Quid Pro Quo Contracts.


Relief Requested:
An order setting aside the actions taken by the SDCERS board of trustees in 1996 and 2002 adopting the above proposals and further setting aside any and all benefits conferred on any party as a result of the adoption of MP-1 and MP-2, as alleged in this complaint.”

Aguirre has found a way to kill two birds with one stone: he gives the judge no alternative but to apply the law as written and hits these eight uppity officials with triple damages for making it necessary to go to court to prove the obvious, that their actions were in blatant breach of the written law and they knew it.

Let this be a lesson to all those who would make us run to a judge with everything. That is why the legislature wisely imposed triple damages on those who do.

Oh, and as a by-product of his little civil lawsuit against eight crooked officials he will have established "in a court of competent jurisdiction" that a few hundred million in pension benefits were illegal and need to be returned. Mike you're a genius.
 

 
  Frye likes the rough and tumble of Democracy - 07/07/05  
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Matthew Hall's profile of Donna Frye in today's U-T quotes praise from a very surprising source - Mission Bay hotel magnate Bill Evans:
"You can say a lot of things about Donna Frye," Evans added. "Lazy is not one of them. You might not agree with her agenda. You might not agree with her methods, but you've got to give her credit for putting the hours in and staying true to her core values."

Hall does a good job in summarizing her core values: "Clean beaches and clean politics for everyone" but above all "open government".

It is interesting that San Diego's "business interests" find both of those threatening. They backed Murphy because he liked to do the business of the City "in chambers". Is that how Murphy operated as a judge? Is justice and politics just deal-making?

What about Sanders? All the indications are that he too is a deal maker. If he becomes Mayor he will probably disappear behind the closed mahogany doors of the Mayor's Office and only the rich and powerful will have access to him.

That is the choice before the citizens: open government or closed government. Frye or Sanders.

I heard Frye say at a forum recently that she actually enjoys the rough and tumble of open democracy - it makes her feel good when everybody has had their say so all can move on together and do what needs to be done for the common good.

When developers meet with politicians behind closed doors (as they prefer to do) the decks are stacked against the citizenry. Bad things happen - the NTC land giveaway, flawed development bonds like Petco Park etc. In the end everybody loses.

Developers must learn that they too are part of the social contract. The community is their customers and good business require satisfied customers. If one side takes all, everybody loses. Open government is in their best interests too.
 
 
  Why it is possible to roll back the illegal pension benefits - 07/06/05  
 

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The City of San Diego’s Pension Reform Committee’s Final Report dated September 15th 2004 (on page 27) said the following:

The Pension Reform Committee requested and received an analysis of the components of the increase in the Unfunded Actuarial Accrued Liability (UAAL) from July 1, 1996 to June 30, 2003. This analysis, prepared by the Plans actuary, provided the following allocation”
:

Investment Performance

6.00%

82,200,000

Underfunding by the City

10.00%

137,000,000

Use of Plan Earnings

 

12.00%

164,400,000

Net Actuarial Losses

 

31.00%

424,700,000

Benefit Enhancements

41.00%

561,700,000

 

 

 

 

$1,370,000,000

The Reform Committee had this to say about benefit enhancements, which account for $561,700,000 million of the total:

"When a new or improved benefit is granted to existing employees with retroactive applicability for all prior years of service, not only does the Normal Cost of the Plan increase, but a past service liability is also created.

This is most easily understood through the following example: Joe has worked for the City for 25 years. During those 25 years, the Plan called for retirement based on 2.5% benefit for every year of service. Joe was expecting to retire at 75% of base pay if he stayed for 30 years (30 years X 2.5% per year = 75% of base pay). The actuary also expected the same thing and the contribution into the plan was based upon that 75% assumption.

But during Joe
s 26th year of service, there was a plan improvement. Instead of receiving 2.5% for each year of service, he will now receive 3.0% for each year. An option would have been to have Joe receive 2.5% for his first 25 years of service and 3.0% for the future 5 years, but that was not the way the benefit was granted. Because of the “retroactive element,” Joe now will retire at a 90% of base pay (30 years x 3%).

The actuary will adjust Normal Cost for the upcoming years to reflect the increase, but the shortfall related to Joe’s first 25 years of service becomes a past service liability. A variety of such benefits have been granted since 1996. The past service element of these benefits has caused a significant portion of the increase to the Plan
s UAAL.” 

The figure of $561,700,000 for Benefit Enhancements is from the Pension Board actuary. The City Charter and State law prohibit granting past service liabilities.

We need it back, including the amount paid to Jerry Sanders because his final year (of 26 years) was increased like all the others.
 
 
  Some questions for Jerry Sanders - 07/05/05  
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Reading today's profile of Jerry Sanders in the Union-Tribune brought back some bad memories:

His worst (day) was July 18, 1984, when James Huberty walked into the McDonald's in San Ysidro armed with a pistol, a shotgun and an Uzi.

San Diego's SWAT team had practiced hostage situations but had several disadvantages that day, Sanders said, including communications shortcomings and no helicopters or armored vehicles.

Sanders said he was at a police event at Mission Bay when the shooting started. His pager did not work. Told of the emergency, he headed south on traffic-clogged Interstate 805. Along the way, a lieutenant at the scene gave a "green light" to a sniper. Sanders rescinded it but reinstated it eight minutes later at the scene.

His actions fueled controversy, but in the end, the department concluded its tactics were sound, especially given conflicting reports on the number of suspects and weapons. "The FBI and Los Angeles police SWAT officials studied the response and agreed" Sanders said.”

Sanders was SWAT commander on that day. Like most San Diegans I was only too happy to forget all about that awful day and let sleeping dogs lie, but now that Sanders wants to be our Mayor the controversies that surrounded his actions on that day come flooding back like a bad dream.

Here is what Wikipedia, the free encyclopedia, has to say about the massacre: “The massacre began at 4 p.m. and lasted for 77 minutes. Huberty had spent 257 rounds of ammunition before he was fatally shot by Chuck Foster, a SWAT team sniper perched on the roof next door.

The questions that linger with me are as follows:

1.      If Sanders’ pager did not work and the SWAT team could not contact him, was not somebody else automatically in command? Why would it matter that his pager did not work?

2.      Sanders obviously became informed about the situation fairly quickly because he headed south to the scene and was in radio contact with the lieutenant at the scene who had already given a “green light” to shoot Huberty but which Sanders rescinded while in transit? Why would he do that?

3.      What conditions changed to allow the use of deadly force the moment Sanders arrived on the scene?

The nagging doubt remains that Sanders wanted to be the one in front of the TV cameras when Huberty was brought down. Was Sanders already politically ambitious and media savvy?

It just seems a little odd that it took 77 minutes to get a clean shot at Huberty and that the first opportunity only presented itself after Sanders arrived on the scene.

There may be nothing to this but I think it is a fair question for Sanders in view of the fact that he is asking us to trust him to lead our city at the most critical moment in its history. He should be given another opportunity to explain his actions on that day.
 
 
  "Study Shows San Diego Taxpayers Have It Easy" - Wrong! - 07/03/05  
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Ian Port wrote this article in Voice of San Diego on June 22nd. He quoted a report by Thad Kousser Assistant Professor, Political Science, UCSD.

They erroneously concluded that San Diegans are not paying their fair share of taxes despite runaway property values. They thought that somehow San Diegans were avoiding paying their fair share of real estate taxes. That is impossible. Everybody up and down the State of California pays 1% of the value of their property.

Much of the property taxes paid by San Diego property owners does not go to the City but to redevelopment agencies. Port and Kousser seem to be unaware of that.

A quick glance at the figures I compiled from the San Diego County Tax Assessor's office and to which I often refer in my blog, shows that in four wealthy downtown  redevelopment areas, which account for 55.5% of all the property tax diversion in San Diego, the diversion rate is 97%! That is why the tax figures are skewed.

So much for academics and journalists and the politicians who listen to them.

The MEA web site gleefully posted Mr. Port's article. They know a good PR opportunity when they see one, accuracy or inaccuracy is not an issue to them.
 
 
  The City may as well have hired Ann Smith - 07/02/05  
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The City Council hired an outside attorney, Bill Kay from San Francisco, to negotiate a series of wage agreements with the public service unions. Here is his op-ed piece in today's Union-Tribune.

The whole thing is fascinating in its outrageous doublespeak.

He starts: "First, we negotiated a two-year wage and benefit freeze that will result in an estimated actuarial reduction of the pension liability by $150 million."

The $150 million Kay is talking about is the estimated amount of increased benefits the City would have been liable for if the employees had received a 3% increase this year and the next, resulting in an increase in their “Final Compensation” (the highest rate of compensation during a one year period, usually their final year) when they retire.

This is like a burglar telling you that he could have robbed your house but didn't so you now owe him, not only for the present value of the estimated loot, but for how much you would have saved over the remaining years of your mortgage if you had used it to pay down the balance.

He goes on: "Second, as a result of the equivalent of an additional 3-percent pay cut starting July 1, the employees will immediately provide the city with the equivalent of an approximately $17 million annual revenue stream, solely dedicated to reducing the pension's unfunded liability".

The burglar proceeds to explain to you that the money he will not steal from you every year must be put into his pension fund every year from now on.

Seeing no protest: "A recurring stream of $17 million is sufficient to make the annual payments on a $200 million pension obligation bond, or to make the recurring loan payments on a $200 million loan secured by city-owned property".

This lump sum into his pension plan is also equivalent to the amount you could borrow (secured by your house) against the annual amount he will not steal from you. Got it?

Then he adds it all up for you: "According to actuarial projections, when the $200 million pension contribution supported by the $17 million stream is coupled with the pension liability reduction of $150 million resulting from negotiated wage and benefit freezes, the combined impact on the unfunded pension liability will be $350 million over the next two years".

When you add together what he will not steal from you together with how much you could borrow against it, you double your money!

According to Mr. Kay the employees have given the City $350 million by foregoing a wage increase of 3%. Too bad they did not forego a 12% increase, they would have given the City $1.4 billion, enough to pay off the entire pension deficit!

Adding insult to injury Mr. Kay explained how this imaginary $350 million will save the City another $18 million per year: "These wage settlements will also ease the pressure on the city's budget. Within two years, the $350 million impact on the pension's unfunded liability could reduce the city's annually required payment to the pension by an actuarially estimated $18 million per year". Why stop there?

Then for the survey that proves we are a cheap lot in San Diego.

He says: "A survey prepared for negotiations comparing pension benefits for public agencies shows that the city's core pension benefits for its employees are similar to those offered by other cities in the county, by the 10 largest cities in the state, and by the county itself."

Here read for yourself. Contrary to what Mr. Kay says it is, this survey is not a comparison of benefits, it is a comparison of employer pension costs.

But truth did not deter Mr. Kay: "The survey shows that the major source of San Diego's pension problem is not the level of the core benefits – they are not outside the public sector norm. The city's problem is the failure to fund the benefits."

The truth is that t
he San Diego City employees, particularly police and fire, have the highest employer pension cost of the ten largest cities in California.

The City hired this guy to negotiate on their behalf but not only did he hoodwink them but he is now doing PR for the unions in the San Diego Union-Tribune.

Why didn't they just hire Ann Smith and save us from having to read all this crap.
 
 
  An "illegal acts investigation" cannot be avoided - 07/01/05  
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This is a quote from Ann Smith on the MEA website:

"At each critical juncture -- from January through Monday, June 27th -- the City Council has rejected Mr. Aguirre's legal advice and adopted the position which MEA had urged upon them".

Why do the City Council consistently listen to Ann Smith and ignore Mike Aguirre? One can only conclude that the public employee unions own the City Council.

Mike Aguirre (the attorney the people elected) has repeatedly advised the City Council that the pension board
(whose financial statements are an integral part of the city's financial statements) must either conduct its own illegal acts investigation or submit to the one required by KPMG, in accordance with standard accounting practices.


The question for the pension board next Tuesday therefore is not whether to waive attorney-client privilege but whether to conduct an "illegal acts investigation" or resign. KPMG has repeatedly told the City Council that somebody has to do it, but so far Ann Smith has succeeded in blocking it by dint of the influence she wields at City Hall, about which she openly boasts on the MEA website.

On May 31st Dick Murphy infamously exclaimed from his Mayoral seat "Thank God for Ann Smith". What "illegal acts" are they both afraid of?

What personal liability do each of the Council Members incur when they knowingly reject the advice of the elected City Attorney in favor of an un-elected outsider? They may yet find out. We the people will eventually get to the bottom of these "illegal acts".
 
 

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