San Diego Today
Unfiltered News  based on  Source Documents
An independent, issues-oriented, online news organization

Home

Blogs - by Date

Blogs - by Issue

Video Library

About

Contact

Blog Archives - 2007 Third Quarter

 

Meanwhile the misuse of public money goes on.  09/30/07

 
                                                       by Pat Flannery                                        top^

Back to the citizens' business - I really hate the petty bickering - it distracts our attention from real issues like the following:

Pacific Scene Homes and Pacific Scene Commercial are finalists for the SEDC project    I wrote about on July 18, 2007. So is Cox Communications!

Here is a report from Carolyn Smith, President of SEDC, to her Board last Wednesday September 26, 2007. It shows that Pacific Scene is in a runoff with Cox Communications for developing the site. It was supposed to be for affordable housing!

Cox wants to expand its current facility nearby on Euclid Avenue, while Pacific Scene Homes/Commercial wants to build 47 single-family homes mixed with an undisclosed amount of commercial, in other words the very profitable mixed-use type of development. Either proposal is a far cry from the affordable housing project that SEDC promised. It is outrageous that Ms. Smith would accept the Cox all-commercial proposal as a finalist.

Here is Carolyn Smith's "Report to the Council" on July 13, 2004 when she made her request for NOFA funds to purchase the above site.
Her request for $4 million was granted because she represented to the City Council that "The Developer is proposing to develop the Site with 120 low-income multi-family rental units and 50 market rate single-family, for-sale attached units."

Now, three years later, she has accepted two final bids, neither of which offer affordable housing and will simply pay back the NOFA funds. She used affordable housing funds to assemble a valuable site for a private developer.

Not only was the site assembled using money from the affordable housing fund, the threat of eminent domain was used to evict
"seven tenants and two owner-occupants living in separate single-family dwelling units on the site", according to Smith's own report.

Carolyn Smith of SEDC actually says in her Report that by providing this type of "move-up" housing SEDC is creating opportunities for lower income folks to purchase the "recently-vacated" homes of the "move-up" people. This creates affordable housing according to her. I kid you not. Read it for yourself, I have underlined the passage in red.

The truth is that affordable housing (NOFA) funds was actually used to reduce the City's stock of affordable housing. SEDC used NOFA funds to acquire this site, then destroyed several low income homes to clear it for use by one of the above two private developers. T
his is just a sample of the craziness that is going on in San Diego government today.
 

 
 

America's Nastiest Blog  -  Chris Reed in the U-T.   09/30/07

 
                                                       by Pat Flannery                                        top^

This Chris Reed guy is giving the rest of us bloggers a bad name. In fact he is giving the San Diego Union-Tribune a bad name. I know of no real blog that would stoop so low.

On September 25, 2007 Reed posted this entry in his "America's Finest Blog". He explained that he had "Googled" Mike Aguirre's email address and discovered this entry on an LA Times story dated May 11, 2007. Reed preferred to believe what nobody on that thread or in all of LA believed: that the poster was actually the San Diego City Attorney.

Nevertheless in today's print edition of "America's Finest Blog" the U-T printed a picture of Mike Aguirre in
juxtaposition with a picture of the accused murderer - Phil Spector. But that is not all. In its electronic version of "America's Finest Blog" the U-T has a link to a YouTube video of the infamous 1964 Lyndon Johnson TV ad showing a little girl plucking daisy petals suggesting a count-down to a Barry Goldwater nuclear Armageddon.

"America's Finest Blog" today places that never-to-be-forgotten TV ad in
juxtaposition with a blog entry headed "Mike Aguirre: civic arsonist". That is why from now on I will call Chris Reed's U-T blog "America's Nastiest Blog".

The Johnson campaign had the decency to pull the ad. The San Diego Union-Tribune should have the decency to fire Chris Reed. San Diegans deserves better. In yellow journalism the Reed blog is no better than the 1964 attack on Barry Goldwater.
 
 
 

The unions are still running the Mayor's office - they always have. 09/29/07

 
                                                       by Pat Flannery                                        top^

Having lost the developers (Sunroad and Waring) and the Republican right (gay marriage) Sanders has now embraced the left. He didn't choose this fight with Aguirre, the unions demanded it. While claiming to "Reform City Hall", Sanders is choosing to ignore the biggest reform item of all - the unacceptable level of union (MEA) power.

I went to the 13th Floor Press Room at City Hall yesterday and watched amazed as a large contingent of the Mayor's staff handed out huge packages each containing 71 pages of photocopied material criticizing how Mike Aguirre runs his office. The event was billed as a "news conference".

Today I fully reviewed the Mayor's handout material. It is now on his web site here. That 71 page printed package required a large amount of City staff time. But in the end it is empty of fact and just another attack on Aguirre, full of petty distortions, more suited to a junior high school playground than the staff of America's eighth largest city. As the Texans would say, it is all hat and no cattle.

There is obviously a hidden agenda here. Sanders' cover letter reads like it had been written by Ann Smith, attorney for the City employees union (MEA). Perhaps it was.

The Mayor's staff now seems to be the instrument of the powerful MEA leadership. Sanders has abandoned the taxpayers and the business community that elected him and given himself over to the MEA. The gay marriage flip-flop was only a curtain raiser.

Watch this video
of Sanders and his Chief Operating Officer, Jay Goldstone, hyping the pension benefits some 680 employees are now entitled to, according to Sanders. Ann Smith couldn't have done it better. It appears that the Mayor intends to use the union card to get reelected. Why else would he be doing this?

Let us examine his present position and see if it will stand up to scrutiny.

His attack on Aguirre is based on this letter from the SDCERS counsel, Christopher Waddell, dated August 3, 2007, to Scott Chadwick, the City's Labor Relations Manager.

It says that SDCERS will not recognize the July 1, 2005 MOUs as having any authority until the date the City Attorney had made the "necessary changes in ordinances to conform to the MOUs". That date was February 16, 2007. 

According to Waddell the 2005 MOUs were therefore not worth the paper they are written on until the City Attorney entered them into the Municipal Code. That gives an awful lot of power to a City Attorney. Were all previous MOUs treated that way? I thought they were all binding from the moment they were ratified by the City Council. That's what they say.

What would have happened if the 2005 MOUs had granted additional benefits, not taken them away? Could Aguirre have held up MOU-granted benefits for 18 months?  According to Waddell's theory he could. I think Ann Smith would have something quite different to say if that happened. Has she not always maintained that once the City Council promises a pension benefit it is cast in stone? Her entire legal strategy is based on that contention.

I will go back and study her whiney pleadings before the City Council. She never put much store on the Municipal Code. Her currency was always City Council promises.

Which side should the Mayor be on in this dispute?  Right now he is putting Waddell's opinion above that of Aguirre. But the people elected Mike Aguirre, not Chris Waddell.  For the Mayor's sake, Waddell had better be right. It seems that Sanders has launched this vicious attack on his former friend Mike Aguirre, in order to curry favor with the unions - a very dangerous gamble that may backfire on him. In order to prove himself right, Sanders must prove Aguirre wrong. But the facts and logic are firmly on Aguirre's side.

Here is Aguirre's August 21, 2007 response to Waddell's August 3, 2007 letter. Aguirre makes it clear that the 2005 MOUs were binding from the moment the Council approved them. There was never anything conditional about such approval. Ask Ann Smith.

It is interesting that Sanders never once mentions Aguirre's response to Waddell, only Waddell's "advice". I have reread Sanders' letter three times to be sure. Sanders is thus ignoring the advice of the elected City Attorney and taking that of an outside attorney.

Sanders has accused Aguirre of advocating bankruptcy. Again, I read Aguirre's September 7, 2007 letter several times to discover if that was true. Aguirre wrote: "City officials destroyed the City's credit rating by increasing pension and retiree health care benefits without proper funding and in violation of local and state laws". Sanders  characterized that as advocating bankruptcy. Read Aguirre's letter and decide for yourself.

Our problem is that we have a city employee union (the MEA) that is too strong and a mayor that is too weak - exactly the opposite of what the people voted for. Sanders has flip-flopped the entire strong mayor concept. The MEA is running this City!  What we need is a strong mayor who will fight the City unions, not cave in to them to get reelected.
 
 
 

Are we witnessing a Mayoral meltdown? 09/27/07

 
                                                       by Pat Flannery                                        top^

By now you have all heard the Mayor's shrill attack on the City Attorney, accusing him of costing the City millions of dollars by delaying the following changes to the San Diego Municipal Code:

§24.1201.1 Non Health Eligible Retirees

Members hired or assuming office on or after July 1, 2005, are non Health Eligible.
("Non Health Eligible Retirees" added 1-17-2007 by O-19567 N.S.; effective 2-16-2007.)

§24.1312.1 Prohibition of Five-Year Purchase of Creditable Service

Section 24.1312 does not apply to members hired or assuming office after July 1, 2005.
("Prohibition of Five-Year Purchase of Creditable Service" added 1-17-2007 by O-19567 N.S.; effective 2-16-2007.)

§24.1402.1 Ineligibility of DROP Participation, and Waiver

Members hired or assuming office on or after July 1, 2005, may not participate in DROP.
("Ineligibility of DROP Participation, and Waiver" added 1-17–2007 by O–19567 N.S.; effective 2-16-2007.)

§24.1503.1 Prohibition of Annual Supplemental Benefit

Members hired or assuming office on or after July 1, 2005, shall not be eligible for participation in the annual supplemental benefit program established by this Article.
("Prohibition of Annual Supplemental Benefit" added 1-17-2007 by O-19567 N.S.; effective 2-16-2007.)

Now read Sanders' memo to the City Council today. Has he read the Municipal Code? What part of it does he not understand? The barn door was closed on February 16, 2007.

The only question that arises therefore is: how many of the approximately 700 employees hired by the City between July 1, 2005 and February 16, 2007 applied for any of the above benefits while, according to SDCERS, they were eligible? The above Municipal Code sections make it clear that they could only do so between July 2005 and February 2007.

Has Mayor Sanders launched his massive attack on Aguirre without reading the relevant Municipal Code? If so, he has truly "lost it".
The gay marriage flip-flop was nothing to this.

There are no "millions of dollars" involved here. At worst, seven employees may have applied for "purchase of service" contracts between July 2005 and February 2007 and there are questions about even those.

As it happened I had called
Rebecca Wilson, Member Services Director of the San Diego City Employees' Retirement System yesterday and asked her how many purchase of service contracts had been signed with employees hired between July 2005 and February 2007. She told me there were none. I asked her to confirm that by email.

Then today she sent me this email, changing her story: "
In fact, there are 7 city employees who were hired between July 1, 2005 and February 15, 2007 who have entered into purchase of service contracts."

She had been very sure that there were no contracts yesterday, so I called her and asked if money had ever changed hands, or merely papers been signed. All she would say was that 7 contracts had been signed. "But when?" I asked? She was unable to give me dates even though apparently she had the contracts right there in front of her. Strange.

So I made a public records request for all the contract documents. Here is our exchange of emails. I will need to reconcile the information she gave me yesterday with what she gave me today. The two stories were quite different.

Any connection between all that and what was going on with the Mayor today I'm sure is purely coincidental. I will post the seven contract documents when I receive them.
 

 
 

The wastewater issue is far from being "An Inconvenient Waste of Time". 09/27/07

 
                                                       by Pat Flannery                                        top^

Steve Francis' "San Diego Institute for Policy Research" weighed in on the wastewater controversy today. It commissioned a survey and released this report. Here are the questions asked of
1008 randomly selected San Diego County residents.

According to the report's summary: "San Diego County residents now perceive that a water crisis is brewing. Only 10% see water availability as a less than serious issue and two-thirds rate the situation as very or extremely serious."

So far Mike Aguirre has taken the lead on this issue, highlighting a void created by Sanders, who scornfully tagged it "toilet-to-tap". The same scornful dismissal as those who dismiss Al Gore's global warming as "An Inconvenient Waste of Time".

While Sanders was laughing and making fun of Aguirre's "toilet-to-tap waste of time", Steve Francis was seriously looking into the wastewater issue and discovering that far from being "An Inconvenient Waste of Time" real San Diegans think it is a real issue.

Now what will Sanders do? He will probably do what he always does - jump on board.

The best way for anybody, including Sanders, to get up to speed on this issue is to read
the "City of San Diego Water Reuse Study". The purpose of that study was to "evaluate opportunities available to the City to increase the citywide beneficial use of recycled water". It is a must read and far from being "An Inconvenient Waste of Time".
 

 
 

Mayor's end-of-year Budget Report raises political fairness issues. 09/26/07

 
                                                       by Pat Flannery                                        top^

Mayor Sanders' staff presented its
"City Comptroller’s Year-End and Charter Section 39 Report for Period 13, Fiscal Year 2007" to the City's Budget & Finance Committee today.

The Report shows that actual revenues exceeded budgeted revenues by $
13,542,297 while actual expenses were $42,068,958 below budget.

Here is the complete report.

I have done the analysis shown below because the Report does not adequately address the fact that he revised the original (balanced) City Council-adopted budget to one that projected a shortfall of $11,694,711. Accordingly, he reported a net variance of $
43,916,544, when in fact the real variance was $55,611,255.

Perhaps he didn't want to draw attention to the fact that, after revisions, the City budget was projecting a shortfall of $11,694,711. Was that fully understood by the City Council each time they were asked to vote on an adjustment? I don't remember anybody from the Mayor's office ever telling them that they were approving a $11,694,711 deficit.
 

General Fund

  Council-Adopted Budget Mayoral Revision Mayor-
Revised Budget
Actual Variance
Revenues 1,023,333,098 + 17,937,833 1,041,270,931 1,054,813,228 + 13,542,297
Expenses 1,023,333,098 + 29,632,544 1,052,965,642 1,010,896,684 - 42,068,958
Revision     (11,694,711)    
Variances       43,916,544 55,611,255

It is obvious that there is a serious lack of information-sharing by the Mayor's staff.

There must have been significant swings of revenue and expense trends identifiable during the year. Were these changes in trends brought to the attention of the City Council? Each Council member should have been made aware of these significant revenue and expense shifts during the year. It impacted the services they were elected to provide.

Among the major trends known to the Mayor was the Property Tax surplus of
$5,680,123. That swing must have been clear for some time. On the other hand Sales Tax was down by $9,034,884. That would have been clearly discernable for months.

That there were major cutbacks in Personnel Services was well known from the beginning of the year. The Mayor kept boasting about them. We therefore assumed he had provided for them in his budget. Now he tells us that he saved $34,567,905 in Personnel Services!

Does this indicate that the City was grossly overstaffed? Or were the budget figures manipulated? $34,567,905 is an awful lot of personnel services. How can you save that amount of money and not impact services? It sounds like manipulation to me.

Here is a video clip of the Independent Budget Analyst, Andrea Tevlin, worrying about the lack of "budget monitoring" by the City Council in the absence of information-sharing by the Mayor's office. She spoke about "significant swings" and "the lateness in learning about them".

Here is a video clip of Jay Goldstone, the Mayor's Chief Operating Officer, responding to Ms. Tevlin. He tried to address the lack of information-sharing and seemed to promise to improve it. But his boss, Jerry Sanders and his well-oiled spin machine, will probably continue to manage all City information for political purposes.

This can seriously skew the political process. Sanders' sole opponent in next year's mayoral campaign, Steve Francis, will not have equal access to vital information. We all know what happens in the absence of fair competition - the public gets an inferior product.
 

 
 

Laws to obey the Law: Aguirre's two Pension Ordinances. 09/25/07

 
                                                       by Pat Flannery                                        top^

Today we started to reacquire the North Star of representative democracy. We emerged from the brown fog of Court Room politics into the blue skies of Council Room politics -
Mike Aguirre drafted an Ordinance instead of filing a law suit.

There are actually two Ordinances: the first is a draft Cost-Neutral DROP Ordinance and the second is a draft Cost-Neutral Purchase of Service Credit (PSC) Ordinance.

Whether t
he Mayor was "angered" or not when he read this leaked internal SDCERS letter last Friday, he sure got his answer from Mike Aguirre today - Obey the Law.

There can be no more paying out of illegal benefits. The DROP and Purchase of Service Credit (PSC) benefits that exceeded cost-neutral, are illegal. And that applies to retirees as well as current employees. It is not just Aguirre speaking, it is the law.

Now it will be up to the City Council, in open session, to decide whether the union tail will wag the City dog, or whether the people will prevail. It will be impossible for the Council to ignore these Ordinances because they are merely declaratory of existing law.

When these Cost-Neutral Ordinances come up before the City Council, under the glare of TV cameras, there will be a titanic battle. But it will be fought in the People's Chamber, in the hallowed hall where the people's representatives meet, not in a court room.

We won't have to read in the newspaper what Judge Barton decides. What happens will be decided in the City Chamber not in a judge's chamber. Judge Barton ruled in favor of public employees because he is one himself. He too is a public pensioner. This pension battle will now be fought on the proper battleground, the battleground of City Council.


Please re-read my blog of yesterday. I have simplified the narrative and added more document links. Hopefully it is now more understandable. I believe it is very important that people understand what is going on with the pension system as it has by far the greatest impact on pot-holes not being fixed and fire stations not being built.
 
 
 

Illegal pension benefits - still "the elephant in the living room". 09/24/07

 
                                                       by Pat Flannery                                        top^

I received this email circular from the Mayor's Office today painting a rosy picture of the City's finances. Apparently he has found a $43.98 million surplus in the City's budget.

It seems to be aimed more at Wall St. than Main St., designed to fool the financial markets into believing the myth that San Diego now has a "Reform Mayor".

Sanders' inability to confront the ruinous pension benefits problem will not escape Wall Street. If the Chairman of a public company tried to fool the markets in a matter as large as a half billion dollars, as Sanders is trying to do, he would not get away with it.

Imagine a situation where a board member of a publicly quoted company has been asking the chairman of that company for an explanation as to how $500 million was miraculously wiped off the company's liabilities, but is unable to get an answer.

Donna Frye is in that position. She continues to ask for answers to the questions she raised on April 20, 2007.

According to SDCERS $527.3 million was miraculously wiped off the pension liabilities on June 30, 2006. Note I use the amount of $527.3 million not $393.2 million as shown in their summary, because there is a $134.1 million offset. $112.7 of that was payments such as the "13th check", formerly contingent upon "surplus earnings" now upgraded to a permanent benefit, without a formal vote of the City Council.

Here is the full Pension Report released January 12, 2007. Go to page 4 of the Report for a full "explanation" of the $527.3 million "correction".

The CEO of SDCERS, David Wescoe, has so far flatly refused to appear before the City Council to answer questions regarding these numbers. Why does the Mayor not simply command him? Is he afraid of what Wescoe might say? Might it tarnish the rosy picture?

The first anybody knew about the shifting of substantial pension liability from SDCERS to the City's General Fund, due to SDCERS' non-compliance with IRS rules, was when Donna Frye asked an awkward question of Jay Goldstone on April 17, 2007.

Here is the original video of  Ms. Frye asking for an accounting of one item, the "Proper treatment of IRS benefit limitation", just $22.8 million of that $527.3 million. She figured if they could explain the mysterious $22.8 million IRS item they probably could explain the whole $527.3 million.

As a result of their total inability to explain this $22.8 million "Proper treatment of IRS benefit limitation" item, we have gradually become aware of the enormity of the General Fund liability that will be associated with this
"Preservation of Benefits" (POB) plan. The truth is that they want us to pay for an entirely separate pension plan, entirely outside the SDCERS plan, to "preserve" benefits far in excess of what the IRS will allow.

And Sanders is going along with this! In fact his staff, led by Jay Goldstone, has actively participated in hiding the true size of this additional pension liability from the citizens.

Mike Aguirre first summarized the "Factors giving rise to the Pension Deficit" in his Interim Report Number 3, dated April 9, 2005. At that time, nobody, not even Mr. Aguirre, was aware that large portions of those benefits were in excess of what is allowed by the IRS . Or if anybody was aware, they kept quite about it, even though there was a section in the Municipal Code called the "Preservation of Benefits" plan (POB). Here is the 2001 Ordinance creating it. It has remained dormant in the Code until now.

Ms. Frye has had numerous email exchanges
with David Wescoe, CEO of SDCERS, regarding the $22.8 million figure. All seem to confirm that he just invented that figure. How much liability is really being shifted from SDCERS to the City's General Fund?

In a memo dated July 24, 2007 Wescoe states that he won't know how many retirees exceed the 415(b) limits until the IRS approve the SDCERS testing methodology. Here is SDCERS PowerPoint presentation dated November 17, 2006, explaining the whole 415(b) testing methodology. But still no word from the IRS approving it.

On September 10, 2007 Donna Frye again wrote to Wescoe asking if the number of retirees exceeding the IRS limit is unknown how did he arrive at the figure of $22.8 million. Wescoe responded September 18, 2007. He just repeated that the amount of $22.8 million is based upon the number of participant members i.e. active employees, but as active employees cannot receive pension benefits they cannot be in violation of IRS limits.

Then it must be based on the number if retirees, right? Wrong. In his earlier memo dated July 24, 2007 he explained that he won't know how many retirees exceed the 415(b) limits until the IRS approve the SDCERS testing methodology and of course the IRS  hasn't done that yet.
So around and around we go. Does he think we are all stupid?

The truth is that SDCERS is unable to produce a single Tax Determination Letter to support their  "Voluntary Correction Program" with the IRS. Here is Story Parks' Staff Report dated December 6, 2006 listing her various submissions to the IRS. Still no reply.

Ms. Story Parks is the Chief Compliance Officer for SDCERS. She appeared before the City Council today as part of her ongoing attempt to establish a Group Trust for the City of San Diego, the Port District and the Airport Authority so that they can then establish separate
"Preservation of Benefits" plan (POB) for each Participant Plan Sponsor. That is ultimately what this all about. It is about maximizing pension benefits. In the employees' minds they own the City. They are its shareholders. It exists only for them.

Read Roxanne Story Parks' staff report dated February 5, 2007 recommending the City create a POB Trust. Here is the actual proposed Trust document. There is absolutely no need for this "Trust". The 2001 POB Ordinance is very clear: "
SEC. 24.1606 (c) Benefits due under this Plan as determined by the Board, on the advice of its actuary, shall be paid for by the City."  Setting up a spurious "Trust" is merely a ruse to keep the "Excess Benefits" off the City books. Sanders and the MEA want to make them appear normal and part of the normal Pension Plan. They are not and the people should know that.

The immediate problem is that the so-called amount of $22.8 is unknowable. And we are supposed to believe that $527.3 million has been wiped off the pension deficit. That $22.8 million could be $228 million for all we know, yet the Mayor chooses to rely on it. Why?

Here is a letter Donna Frye received from the Mayor's Chief Operating Officer, Jay Goldstone, dated September 17, 2007. It raises more questions than it answers.

Then we had this letter, a copy of which apparently somebody at SDCERS sent to Sanders last week. It involved another factor in the creation of the pension deficit - "Purchase of Service Credits". The letter elicited this "angered" response from Sanders. Was that anger genuine? Why did he not just summon Wescoe to his office?

You can't "Reform City Hall" without addressing the elephant in the living room - illegal pension benefits. Bad as that $146 million is, PSCs are only 10% of the deficit.

Here is what the former SDCERS' actuary had to say about PSCs in May 2004. He said that the Purchase of Service Credits program (PSC) was creating a "deluge of requests". City employees knew a good deal when they saw one. As of June 30, 2006 it had cost the City $146 million. 5,975 city employees had taken advantage of it.


City of San Diego "Purchase of Service Credits"
(Since inception to June 30, 2006)
 

 

     General          Safety            Total
           
 (still working)

  Retirees   Grand
Total
 
PSC Contracts
 
3,037    859   3,896   2,079   5,975
Average Age at Purchase
 
45.1   39.6   43.9   52.5   46.9
Total Years Purchased
 
11,242   2,045   13,286   7,357   20,643
Average Years Purchased
 
3.7   2.4   3.4   3.5   3.5
Normal Liability
(If no PSCs)
 
102,675,827   37,242,284   139,918,111   63,290,901   203,209,012
Actual Liability
(After PSCs)
 
147,777,961   34,264,234   182,042,195   167,774,878   349,817,073
Deficiency
(PSCs were undervalued)
$45,102,133   $2,978,049 * $42,124,084   $104,483,976   $146,608,060

* Note: the only way 859 "safety" employees could decrease the City's actuarial liability is if they overpaid for those credits, just as the "general" employees underpaid for them. Another example of how one must always take numbers from the City with a grain of salt.

It is ironic that the only ones questioning this massive abuse of power by the employee unions, particularly the MEA, are people from the left: Aguirre and Frye. Where are the self-described champions of fiscal rectitude from the right? Jim Madaffer? Jerry Sanders?

Then, today, we are told that Sanders has found another $43.98 million under the bed. If, like Donna Frye, he sought answers on the pension deficit we might begin to believe him. He is still behaving like an employee of the City, which he was for 25 years.
 

 
 

Facing up to gay marriage may change how we think of politics. 09/21/07

 
                                                       by Pat Flannery                                        top^

I have no intention of getting into the morality of gay marriage, but I want to say this: Donna Frye should also get some credit for sensing the deep emotional dimension of this issue and the fundamental principles that are involved.

It was being rushed through the City Council by Toni Atkins when Donna Frye said "hold on", lets not treat this as if it is nothing. Let's give the people time to discuss it. She was right. Look what happened when Sanders discussed it with his daughter. This issue goes to the very heart of our humanity. It challenges our principles - if we have any that is.

If the mention of gay marriage can make the Mayor of the seventh (or eighth, what are we now?) city in the United States tear up on national TV, then it matters. Surely he's not that good of an actor or Fred Sainz isn't that good of a script writer.

Carl Luna should now rethink his blog comments about Donna: "....
putting personal principles—“I will not compromise my principles in order to achieve the public good”—is not always a virtue". Luna, who teaches political science at Mesa College and USD, accused Frye of "pursuing principle to the extent of ineffectiveness".

Apart from being unfair to Donna, Professor Luna should rethink his position for the effect it may have on future generations of our politicians. Suggesting to young impressionable students that sometimes in politics "virtue is no virtue" is worrying. That is exactly what has been lacking in politics - "virtue". Our city lost access to the public financial markets because of dishonesty, i.e. lack of virtue, by our politicians - they lied to the markets.

So let's take a collective deep breath and listen to each other on this emotional gay marriage issue. But above all else let our conscience and our principles drive our thoughts, not political expediency. Maybe we will gain a new appreciation of what is really important in life and redefine the fundamentals of our own humanity and politics.

In this instance both Sanders and Frye got it right. By refusing to compromise his personal principles (he obviously supports gay marriage) Jerry Sanders did the right thing, even though it may yet cost him the endorsement of the Republican Party. In refusing to rubber stamp Toni Atkins motion without a public debate, Donna Frye showed the depth of her dedication to the public's right to be fully involved - her great guiding principle.

I profoundly disagree with Carl Luna's endorsement of Edmund Burke, whom he describes as "
the great English statesman". (Burke was an Irishman by the way, not an Englishman). Unlike Frye, Burke believed that when elected, a politician somehow becomes inspired by God. Carl Luna ought not to be teaching Burkean elitism, it is the antithesis to the American belief in representative government. When acute, the Burkean dilemma is easily resolved. Resignation is the honorable course when representative duty conflicts with conscience. Each elected official must make that choice sooner or later.

In America not even Jerry Sanders is inspired by God. Nevertheless, right or wrong on gay marriage, he did the right thing this week. I will take fallible politicians any day - so long as they are honest. (Speaking of gay marriage, the cartoon in today's U-T is hilarious).
 
 
 

Is Bob Kittle always on the side of the crooks? 09/18/07

 
                                                       by Pat Flannery                                        top^

What a strange city this is. The union-dominated Pension Board steals millions of dollars of taxpayer's money but the city's conservative U-T newspaper labels our City Attorney a "bully" for opposing that pension abuse.

This morning Bob Kittle describes Willkie Farr & Gallagher as "a highly respected New York law firm". This is the firm that billed the San Diego taxpayers $10 million while absolutely refusing to account for one hour of its time. We know that at least some of those billable hours were spent "conferring" with Kittle at the U-T Mission Valley offices.

Is Kittle always on the side of the crooks? Has he ever written an editorial condemning the sleaze and corruption that I and others like Don Bauder have carefully documented? Isn't that what the editorial board of the main watchdog newspaper is supposed to do?

Matt Hall did his job this morning by reporting yesterday's Council action appointing Grubb & Ellis/BRE Commercial to sell the City-owned World Trade Center office building at 1250 Fifth Avenue for $17.7 million along with several other City-owned properties. It is not his job to comment on the associated sleaze and corruption.

Is Kittle at all interested in the fact that the broker now representing the City in the World Trade Center deal is none other than Lin Martin? For the full context on Mr. Martin read my blogs of July 28, 2007 and July 25, 2007.

Remember the Madigan/Nieto dirty City College deal? It was Lin Martin of Grubb & Ellis who put that dirty deal together. Where is Bob Kittle's outrage at the conflict of interest represented by the fact that Sanders' real estate broker, Lin Martin, is
the long-term live-in boyfriend of Sanders' top real estate advisor, Janice Weinrick? They are effectively married. Is that not a conflict of interest? Not according to Kittle apparently.

We all know why: insiders do not write about insiders - they concentrate their attacks on outsiders like Mike Aguirre. In doing so they attack the rest of us.

Don't let what happened at City College be forgotten. Go back and read my blogs of July 10, 2007, July 9, 2007, July 7, 2007(a) and July 7, 2007. Bob Kittle would prefer you forget about all that insider sleaze and attack those like Aguirre who want to end it.

This city must raise itself above the corruption that has gripped it for years, or it will most assuredly go under. Insider sleaze must be recognized for what it is. But that is unlikely to happen with Kittle daily covering it up in the editorial pages of the U-T. Honesty must first emerge in Mission Valley. Right now the U-T is facilitating sleaze, not exposing it.
 
 
 

The Pension Board is in gross violation of its fiduciary duty.  09/17/07

 
 

                                                     by Pat Flannery                                        top^

The Pension Board wants to legalize a long standing fraud on the taxpayers: the annual distribution of so-called "surplus earnings" in the form of a 13th Check". It wants to "vest" this benefit, which heretofore has been contingent upon "surplus earnings".

Thomas Paine once said that the passage of time does not improve the title to stolen property. Apparently the Pension Board and its illegally appointed attorney, Chris Waddell, think otherwise.

This union-dominated Board treats annual earnings above an 8% actuarially assumed long range rate of return, as a windfall. That is fraudulent. They have prioritized the payment of these contingent benefits into something called "The Waterfall". Even if there were no deficit, pension fund earnings in one year above actuarial assumptions are assets. Paying out assets is a direct violation of the Board's fiduciary duty.

The City Attorney is not only compelled to dispute the recent flawed "DROP for new hires" opinion of Waddell, he should bring complaints against each and every member of that Board for breach of their fiduciary duty. By paying a 13th Check and allowing continued subsidized DROP benefits, they are wasting the Pension Fund's assets.

On September 11, 2007 the union-dominated Pension Board wrote this letter to Sanders. A copy was sent to Bob Kittle at the U-T who duly seized on the opportunity to write another nasty editorial against Aguirre entitled "City Hall's bully" on September 14, 2007. Kittle endorsed waste of pension assets so he could take a crack at Aguirre.

In that "editorial" Kittle described the City Attorney's effort to rein in Waddell's illegal use of the DROP program as "setting out to criminalize legitimate policy differences". It was more than policy differences, Waddell had, without authority, reinstated the DROP program for new hires, although it was ended by City Council action on July 1, 2005.

Waddell's
decision, presumably endorsed by the Pension Board (although I can find no record of a meeting or Brown Act notice) ignored the fact that the City Ordinance passed on January 17, 2007and effective 30 days later on February 16, 2007, stated: "Members hired or assuming office on or after July 1, 2005, may not participate in DROP."

Waddell and the eleven Board Members
are guilty of gross violation of their fiduciary duty for ignoring the will of the City Council and illegally distributing Pension Fund assets.

Here is Aguirre's August 21, 2007 letter to Waddell. Aguirre was responding to Waddell's letter of August 3, 2007 to Scott Chadwick, the City's labor Relations Manager.
The (ostensible) purpose of Waddell's letter to Chadwick was to reinstate the DROP program for new hires between July 1, 2005 and February 16, 2007, but it's real purpose was much more sinister - Waddell didn't care about new hires, he was protecting the 13th Check.

The July 1, 2005 cutoff date was also contained in the collective bargaining agreement (MOU) adopted by the City Council on that date. In fact everything contained in that MOU had an effective date of July 1, 2005. There is clearly more to Waddell's decision.

My guess is that Waddell and
the Pension Board want to protect the "13th Check". As explained above, that benefit is contingent upon the impossible concept of the fund assets producing "surplus earnings". Therefore it needs to be legitimized. But how?

The unions know that a legitimate 13th Check will require an Ordinance in the full glare of a City Council hearing. There will be huge opposition.

The unions are wrongly asserting that the 13th Check is already a vested benefit.
It is not. Shame on Bob Kittle for supporting them on that falsehood. Our City Attorney needs to be even more aggressive in fighting the crooks, while Bob Kittle wants to muzzle him.
 

 
 

Managed Competition - the left and the right - Aguirre and Francis? 09/13/07

 
                                                       by Pat Flannery                                        top^

On September 5, 2007 the City's Independent Budget Analyst (IBA) issued this Report on the Mayor's lack of implementation of the Managed Competition mandated by Prop C.  The Mayor's staff responded with this Report on September 7, 2007.

It was written by Anna Danegger, the Mayor's acting Project Manager for Managed Competition. Sanders has not even appointed a permanent project manager!

Danegger's hurriedly prepared report merely rehashes the old Sanders fundraising spin without any specificity. It concludes: "The managed competition program is complex, with many difficult tasks at each stage and with numerous stakeholders playing key roles throughout its execution. As a result we are not able to provide a timeline that has great specificity for each stage of the process".

That is bureaucrateese for "we don't have a clue when this is going to happen or whether it ever will." Maybe we should outsource the outsourcers. Ooops, we are not allowed to use the "o" word.

Then along comes Steve Francis yesterday, rolling a political smoke bomb down the musty corridors of City Hall with
his own well researched Report on Managed Competition. He cites case studies of cities and counties around the country that have incorporated Competition into government. Here is a video of his call to action.

Francis pointed out that
"Because of the need to address the City’s pension, retiree healthcare, and deferred maintenance obligations, in FY 2009 San Diego is projected to face a structural deficit in its general fund of more than $96 million and a cumulative 4-year general fund deficit of $375.2 million. This situation makes the speedy implementation of managed competition imperative."

He timed his speech on the steps of City Hall yesterday to coincide with the monthly meeting of the City Council's Committee on Budget & Finance. The Mayor and his bureaucrats were scurrying to the 12th Floor Committee Room to explain themselves.

From the moment Sanders stood in front of the Budget and Finance Committee it was obvious he was on the defensive. Here is a video of him telling the Committee members how his staff had to meet with the unions 68 times. Now he tells us! If he was having problems with the unions he should have told us. He let a whole year go by.

The MEA has been running the City while Sanders has been posing for the cameras. It took the IBA and Steve Francis to smoke him out. Like many Mayors before him, he is afraid to take on the City employees. He sees what they are doing to Mike Aguirre.

Here is an amazing video of Anna Danegger abjectly explaining to Andrea Tevlin why it was impossible to move forward with Managed Competition without the MEA's concurrence. Here is a video of Ann Smith telling how the MEA does not ask "how high" when the Mayor says "jump". She warns about her MEA lawsuit against the City, how much it will cost the taxpayer and how the MEA will use it to stall implementation until the Prop. C Ordinance is changed to its liking - i.e. until they make outsourcing impossible. Anybody who thought otherwise did not know San Diego politics.

This video is of the Mayor's staff further explaining how they have deferred to MEA sensitivities all throughout the BPR and Managed Competition process. Watch it for yourself. It could hardly be clearer who is really running the City despite Prop. C. The result of Prop. C so far is to deliberately stall the implementation of all BPR efficiencies for fear of compromising City staff's competitive position
vis-à-vis the private sector.

As a result of union power the fiscal situation is much worse than even Steve Francis has stated.
This Mayor has NOT addressed "the City’s pension, retiree healthcare, and deferred maintenance obligations." He will not even begin to pay down the pension deficit until 2012. Deferred maintenance cannot be tackled until the pension deficit is resolved.

On the other side of the coin, Donna Frye wondered what the voters actually voted for. Will they get it? She asked why the principles of free Competition are NOT being applied to the $1.4 billion of City contracts already in existence. She has long been unable to get details of those City contracts. She asked how we are to manage new City contracts when we cannot manage the ones we've got? Nobody had an answer.

We have been robbed blind by private "partners" for decades and now we want more! Is it better to be robbed by private enterprise than by public unions? Is McMillin's NTC $1 billion heist somehow less terrible than the public employees $1 billion pension heist? Donna Frye is right, it will take people from both political wings to put San Diego right.

After the Francis press conference I took this video of an unlikely pair in deep conversation - Steve Francis and Mike Aguirre. I respected their privacy and kept my distance, but I would have loved to hear their discussion. Remember, Aguirre supported Prop. C. As an attorney in private practice he did not wallow in public sector benefits. Both these men created their own privileges in life - they worked hard for them.

Could it be that these two poles-apart politicians have much in common? Could it be that they share a desire to bring genuine reform to City Hall - not the phony variety?

Aguirre was not afraid to take on the unions as soon as he got into office. Sanders on the other hand has done everything possible to protect the privileged class who elected him and ignored the pension deficit. It doesn't affect them. Would Francis do the same? If he would be willing to go after the giveaways to San Diego's privileged class, while Aguirre continues to go after the illegal pension benefits, we could have a revolution in this town.

We might even get our structural deficit problem solved by negotiation, which is what Pat Shea has always said is inevitable. Chapter 9 Bankruptcy is just forced negotiation, that's all. Note that t
here is no provision in the Bankruptcy Code for liquidation of City assets or the distribution of proceeds to creditors.

It could be argued that because Sanders is not paying down the pension deficit the City is eligible to declare bankruptcy. According to his own published amortization payment schedule, far from doing what the voters mandated in Prop B, paying off the pension deficit over 15 years, Sanders will have added more than $20 million (there will also be interest on the unpaid interest) to the pension deficit by the time he leaves office.

Maybe it's because Mike Aguirre put down his own money to become City Attorney that he is so independent. Steve Francis and his wife Gayle created their own breaks in life. Now they too seem willing to take on the job of San Diego Mayor and pay for the doubtful privilege with their own money.

Maybe such independence is the answer to the corrosive effects of current campaign contributions law until we can reform it. Personally I am in favor of public financing. In the meantime maybe what Aguirre and Francis are willing to do is the ultimate form of public giving. If so, we may see more of these two men meeting and swapping ideas about how to give San Diego back to its citizens.

This long-in-the-making fiscal sickness is the result of slowly accumulated union power on the one hand combined with the traditional privileges of San Diego's elite on the other. Power needs to be wrested back from BOTH sides of the political spectrum.

Did I get a tiny glimpse of the future through my video lens yesterday?
 
 
 

Maybe Jerry Sanders was right in 2004 - Prop. F was NOT a good idea. 09/10/07

 
                                                       by Pat Flannery                                        top^

Obviously Mike Aguirre is hitting the mark on a wide range of establishment sacred cows, so the power elite is now trying to discredit him and get rid of him. They know they cannot defeat him at the polls so they are trying to
eviscerate his Office.

A subcommittee of the Mayor's Charter Review Committee voted on Friday to recommend a Charter change that would require the City Attorney to obtain the permission of the City Council before filing a law suit on behalf of the People. That puts the cart before the horse.

The Charter Review Committee wants the City Council to advise the City Attorney on matters of law. Can you imagine the abuses that would lead to? Can you imagine how people like Peters, Madaffer and Atkins would have used it over the last 7 years? It would be impossible, for example, for a City Attorney to press for disclosure or accountability to the SEC. Peters, Madaffer and Atkins would have killed that one off long ago.

Aguirre responded with powerful arguments. Here is his press release from Friday September 7, 2007. Here is his report urging the preservation of the City Attorney as an independent elected official. The establishment wants to make the City Attorney an appointed position. Their hirelings are howling all over the media. It is a determined and concerted attack. They do not want a City Attorney Office they do not control.

This is a grab for power by the establishment elite, whom A. R. Sauer of the San Diego Herald described in 1931 as "the high-hatted Charlie boys". It is a delightful piece and well worth the time to read. A quote: "one of the strangest things in the history of Southern California is the fact that San Diego has permitted itself, almost without interruption, to be led around by the nose by a self-centered clique of bacterial growths whose only claim to fame was their overwhelming avariciousness". And people accuse me of hyperbole?

How disappointed Mr. Sauer would be today to see the same clique of "high-hatted Charlie boys" back in power after all his journalistic labors. How sad he would be to find that "the lady San Diego" has gone back to sleep and is about to be raped in her sleep again (is that hyperbole? If so, I am only trotting after A. R. Sauer.)

So what can we do to face down this determined onslaught by the same "self-centered clique of bacterial growths whose only claim to fame is their overwhelming avariciousness"? How can we prevent the rolling back of the Charter measures introduced by the people of San Diego in 1931 for their protection? This Mayor's Charter Review Committee has taken aim at every people-serving part of the current Charter and want to turn it back into the establishment-serving Charter it was prior to 1931.

Would this be happening if we never passed Proposition F, the strong mayor initiative? Probably not. Here is what was put before the voters in 2004. Note that Jerry Sanders joined Donna Frye in opposing it. Ron Saathoff endorsed it.

Personally I supported Prop. F in 2004. I still do. But If Sanders and the current generation of high-hatted Charlie boys, having sniffed the aphrodisiac of absolute power, now want to
eviscerate the City Attorney's Office to protect that power, it is time we reconsidered the Strong Mayor system. I don't want a Mayor THAT strong!

Maybe Jerry Sanders was right in 2004. Maybe we should scrap the Strong Mayor idea and go back to the City Charter that has served us well for 76 years - since 1931. If the sniff of absolute power has emboldened the old "self-centered clique" into re-making the City Attorney into their obedient servant, we need to go back to the Spirit of '31.
 
 
 

The immense challenge facing the next Mayor and City Council. 09/08/07

 
                                                       by Pat Flannery                                        top^

Reality is beginning to peek through the fog at City Hall. The cooling coastal layer we San Diegans love to wake up to is beginning to disappear in the glare of the midday sun.

Yesterday the Fourth Appellate District Court of the State of California handed down a landmark decision.

Six former members of the City's Retirement Board petitioned the California Appellate Court claiming that their self-serving vote to increase pension benefits for City employees, including their own,
did not violate Government Code section 1090, a statute that prohibits public officials and employees from having a financial interest in contracts they make in their official capacities. They tried to take the "salary" exemption. They lost.

They will now go to trial with these Appellate Court words ringing in their ears:
"If the People can prove at trial that petitioners knew that an increase in pension benefits was contingent upon their approval of MP2, which the People claim was an action that was not actuarially sound, their actions allegedly conflicted with their duties as board members."
 

These six were charged by District Attorney, Bonnie Dumanis, in May 2005 with felony violation of Code 1090.

Lexin was the City's human resources director; Vattimo was the City treasurer, Webster was the City's assistant auditor and comptroller, Saathoff was a City fire captain, Torres worked for the City police department crime lab, and Wilkinson was a City management analyst.

The enhanced benefits package was conditioned upon the Retirement Board

Cathy Lexin Ronald Saathoff John Torres
Mary Vattimo Teresa Webster Sharon Wilkinson

agreeing to defer the corresponding increase in the City's contribution way into the future. It is still going on. Sanders has deferred it until after he leaves office in 2012!

The Appellate Court found that these six employees totally dominated the 13 member Retirement Board at the time. The charged members are in red.

The Thirteen-Member SDCERS Board

Composition

Representation

Three Members Elected by General Members: . Wilkinson, Casey and Torres
One Member Elected by Fire (Safety Members): Saathoff.
One Member Elected by Police (Safety Members): Rhodes
One Member Elected by Retirees: Crow
Three Members Ex-Officio: City Manager (designee),
City Treasurer, and City Auditor (designee):
Lexin, Vattimo and Webster.
Four Members San Diego Citizens Appointed by City Council (including one local banker): Shipione, Vortmann, Garnica and Pierce

The non-charged members of the Board were:

John Casey was an elected General Membership Representative. He worked for the Planning Department and was a Municipal Employees Association union official.

Thomas Rhodes represented the police. He was secretary of the POA. He had been a police officer for 26 years. He participated in most if not all negotiation meetings between the City and the POA.

David Crow sat on the board as an elected representative of the retired members of the system.

Diann Shipione, a vice president of investment at UBS Financial Services in La Jolla, was a citizen appointee of the City Council.

Richard Vortmann, President of National Steel and Shipbuilding Company (NASSCO), a San Diego-based shipbuilder, was also a citizen appointee of the Council.

Ray Garnica who worked for United California Bank, was a City Council appointee.

Frederick Pierce IV
was also a City Council appointee. He was President of the Board,
a developer and close friend of Dick Murphy.

I do not know why Crow and Casey were not charged. They also personally benefited from their votes.

After various intermediate votes and modifications to the benefits plan, by both the Retirement Board and the City Council, the final votes took place in November 2002.

On November 15, 2002 Saathoff, Vattimo, Torres, Webster, Pierce, Crow, Garnica, Casey and Vortmann voted for the unfunded benefits. Shipione and Rhodes voted against it.

Shipione said:
"my message back to whomever dreamed up that idea at the City is I think it is corrupt, period." Thomas Rhodes representing the police, showed great personal integrity by voting his conscience.

Just three days later, on November 18, 2002, the final benefits package was considered by the San Diego City Council. Accompanying the proposal were two letters supporting the deal, one from fiduciary counsel Robert Blum and another from actuary Rick Roeder. The City Council approved the benefit improvement by a vote of 8 to1, with Council member Donna Frye opposed.

On that fateful day, Diann
Shipione to her eternal credit, appeared before the City Council in one last desperate effort to prevent the tragedy. Only Frye listened.

Thus, the City employees on the Retirement Board, joined by two other Council appointees, Garnica and Pierce,
aided and abetted by the Pension's fiduciary counsel Robert Blum and its actuary Rick Roeder, granted billions of unfunded pension benefits to thousands of City employees, including themselves, most of it retroactive.

The final responsibility and shame rests with the City Council. They wanted their cake and eat it. They betrayed the people of San Diego on a massive scale and have shown zero remorse to this day. The current Mayor has shown no inclination to address the issue. Sanders continues to sweep it under the carpet until he has left office.

So let's look at the consequences we are living with today:

Here is a list of 617 current retirees whose Present Value of Annual Benefits (PVAB) is greater that $900,000 each. The list runs from one individual's PVAB of $2,354,565 to the 617th individual whose PVAB is $900,199.

That means that the Pension System has to maintain a cash investment of $2,354,565, earning a minimum return of 8% per annum, to pay the top individual's annual retirement of $164,383 or $13,700 per month for the rest of his/her life and 50% thereafter for his/her surviving spouse. And so on down the line to the last retiree.

These top 617 retirees account for
$51,604,134 of the system's annual payout and $703,359,267 of the total investment required to be in the system. I do not have figures on the remainder of the retirees, but this is sufficient to dispel the myth that SDCERS has no Cadillac pensions. At least 617 of them can afford to drive Cadillacs.

I sorted the list of 617 into two other orders. First I sorted them into "Type" of benefit, showing a subtotal for each type.

Type

Number of
Retirees

Annual Benefit

Present Value

% of total

Beneficiary

2 $152,578 $1,921,903

0.27%

Disabled

9 $773,506 $8,739,925

1.24%

DROP

295 $24,330,686 $343,078,618

48.78%

Normal

311 $26,347,364 $349,618,821

49.71%

Total: 

617 $51,604,134 $703,359,267

100.00%

("Beneficiary" means somebody other than the retiree. "DROP" means Deferred Retirement Option Plan.)

Then I sorted them into "Class" of retiree, showing a subtotal for each class.

Class

Number of
Retirees

Annual Benefit

Present Value

% of total

Fire

206

$16,883,610

$231,419,687

32.90%

General

144

$13,122,913

$174,205,821

24.77%

Lifeguard

5

$438,478

$6,381,594

0.91%

Police

262

$21,159,132

$291,352,165

41.42%

Total

617

$51,604,134

$703,359,267

100.00%

Is this acceptable to the People of San Diego? Will the City Council get away with it? The current Mayor and Council seem disinclined or incapable of making the hard choices.

Here is what City Attorney had to say in a letter to the Mayor dated September 7, 2007:

"Rather than do the work needed to get rid of the illegal debt and fund the obligations, the Mayor and certain members of the City Council have opted to continue the past practices of relying on the pension system's phony numbers and pushing the debt off to future generations. The City must reverse course and make the hard choices needed to return the City to financial health before it can re-enter the public financial markets."

It is looking more and more like it will fall to a new Mayor and a new City Council to "return the City to financial health". The present Mayor seems absorbed with his own image and incapable of any meaningful action across a wide range of City business.

Four of the current City Council members, Peters, Atkins, Madaffer and
Maeinschein are trying to avoid the fate of the above six City employees. They refuse to address the illegal pension benefits because that would require admitting that the benefits are indeed illegal. Mr. Aguirre has charged that these four Council Members are currently exercising "Adverse Domination" over the City Council. If Mr. Aguirre is correct then San Diego truly is "Enron-by-the-Sea".

Just as Kenneth Lay and Jeffrey Skilling were less concerned with Enron's financial
health than with manipulating its stock price on Wall Street, these four City Councilors are less concerned with San Diego's fiscal health than with hiding their own past misdeeds.

But just as Ken Lay and Jeff Skilling could not hang onto the helm of Enron forever, these four conflicted City Councilors will shortly to be termed-out (thank goodness for term limits). Before voting for fresh Councilmembers we must ask them whether they will join Sanders in sweeping it all under the rug or address the funding problem. We need real "reform", not more empty promises to "turn San Diego around" we got last time.
 

 
 

Carl DeMaio needs to rethink his "helping Jerry Sanders" slogan. 09/06/07

 
                                                       by Pat Flannery                                        top^

How would you like to go up against this guy for City Council - Carl DeMaio. Look at his fundraising prowess and his ability to match those funds. I did a blog on him last year entitled "Carl DeMaio is the real face of Prop C. 10/18/06". He represented a scary scenario back then, it has become even scarier since. He is the neo-cons' neo-con. His idea of "reform" is to
severely constrict representative government and privatize it all.

Here's what I wrote at the time:

"Don't you just love privatization? Vote for Prop C, get on the Sanders/DeMaio list of Approved Outsource Contractors and you will never need to work again. Never mind the fact that in the process you will turn San Diego into a Third World city, but that's OK because you will be rich enough to live in a gated community in North County."

Here is his contribution list for January to June 2007, sorted first by the employer of the contributor, by occupation and finally by the contributor's name. I just thought it would be revealing to look at Carl's contributor list in those three ways. It is very revealing.

Perhaps the most revealing is the "occupation" sort. It is clear that the business leaders expect great things from Carl. You can also see the individual companies that expect great things from him, the Manchester Group for example, where he gets the maximum contribution from the Chairman, the Vice Chairman and two of its Presidents. The same with Helix Electric and Gould Electric. Helix and Gould must be in the running for some big bucks working on Manchester's Navy Broadway project if Carl can get it through.

Then there is this giant fundraiser the Lincoln Club has planned for September 11th at the Town and Country. My, you would think Carl was running for Mayor, maybe he is. Well at least Assistant Mayor. The Lincoln Club flyer starts with the banner headline:


"I pledge to help Mayor Sanders finish the job of Reform…and clean up City Hall!" --Carl DeMaio.


There's that "Clean up City Hall" mantra again. It must have powerful meaning for the business community because it raised
$1,008,225.00 for Jerry Sanders in 2006, another $68,349.99 for Jerry's Charter Change proposition war chest from January to June 2007 and now another $56,169 for Carl DeMaio to help Sanders finish his "cleaning" job.

To these generous givers it means concentrating all power in the hands of their chosen ones. Democracy needs to be cleaned out of City Hall, it is an impediment to business.

We have seen it at work since Sanders started "cleaning up" at City Hall - more sleaze and corruption, more grabs for power. Surely that is not what Carl DeMaio is offering, more of Jerry Sanders? I thought Carl had some fresh ideas of his own. I guess not.

The Chairmen's power-hungry check books will be out
in earnest on Tuesday September 11, 2007, writing $270 checks to "Reform City Hall with Carl DeMaio" at the Town and Country Hotel 500 Hotel Circle North, San Diego 92108. DeMaio is on the auction block.

With the backing of Doug Manchester, who wants to make San Diego ground zero for the next terrorist attack, by building the U.S. Navy Headquarters right in the middle of the busiest tourist location in the State, sitting right on top of an earthquake fault, we can all sleep soundly in our beds once DeMaio starts helping Manchester "clean up San Diego".

There is something wrong with this picture. If I were you Carl, I would rethink the whole thing. It will take more than corporate money to win this election. The people want reform alright, but not the kind Sanders has been delivering. Let's hear from Mitz Lee, let's hear if she has something better to offer. Anything would be better than "helping Jerry Sanders".
 
 
 

Sanders' Sunroad II - the Regents Road Bridge. 09/06/07

 
 

                                                     by Pat Flannery                                        top^

Below is a satellite picture showing the locations of the proposed Regents Road bridge relative to the three fire stations in that northern area. There is no fire station in all of University City, North or South, or is there likely to be, if Sanders and Fire Chief Jarman remain at their posts. The money for a new fire station will be squandered on the bridge.


Here is an email  from Assistant Fire Chief Tracy Jarman to Laura Brenner, the city's Public Safety Geofile Coordinator, dated June 7, 2004. Laura Brenner is responsible for maintaining the street layer of the Geographic Information System (GIS) used by both the Police 911 and the Fire/EMS 911 systems. Her GIS street layer provides both of the public safety services with the fastest route to the scene of an emergency.

Jarman also sent a copy of her email to Douglas Bolton, Information Systems Analyst for San Diego Fire and Life Safety Services. SDFLSS operates the  911 Computer-Aided Dispatch system (CAD) which is the heart of the City's 911 emergency dispatch system.

Here is Jarman's  letter dated July 19, 2006 to Kris Shackleford, Patti Boekamp's Deputy Director Of Engineering and Capital Projects Department, shortly before the City Council's vote approving the bridge on August 1, 2006. It was clearly designed to mislead the City Council regarding response times from all three fire stations to the proposed bridge.

It is impossible that Jarman could have made the egregious errors she claimed to have made when caught falsifying response times to the City Council on August 1, 2006. It is extremely unlikely that Laura Brenner's GIS street maps, on which the entire City's emergency services depend, could have been so badly wrong on all the three journeys from all the three fire stations to the proposed Regents Road bridge.

Dr. Daniel Arovas tried to warn her about her intended lies prior to the crucial August 1, 2006 City Council meeting. He wrote her this letter the day after the meeting. Watch again the
dramatic video of Dr. Daniel Arovas' exposé of her lies to City Council.

Samuel Oates, a deputy chief and fire marshal who retired last month, had sent this unsolicited reply to Tracy Jarman email on June 29, 2004. Oates, who oversaw Fire Prevention, was known for his honest answers, a rare trait in San Diego public service. 

Sam said "Putting Regents Road bridge through will not help our Fire-Rescue response times over to the Governor Drive area. Right now Engine 35 can't get to the area on the North side in 6 minutes, let alone across the bridge to service that area". You can see why Sam wasn't Sanders' choice for Fire Chief - he was too honest.

In her June 7, 2004 email, Jarman was collecting information for her then boss, Fire Chief Bowman, who was planning to give Scott Peters a tour of his Council District 1, which includes University City, in mid-July 2004. It appears that under Bowman there was a general consensus in the Fire Department that University City badly needed its own fire station, whether Regents Road bridge was built or not.

So what happened since then? Well, Jerry Sanders was elected Mayor; he eased Bowman out and appointed the compliant Tracy Jarman as his Fire Chief. Sanders is close to the Evans family and had another job to do for them. Remember last year how he all but privatized the Torrey Pines Golf Course in order to give the Evans-owned Lodge at Torrey Pines guaranteed tee times for their favored guests. He even disbanded the Citizens Advisory Council that used to advise the City on golfing issues.

Tracy Jarman is simply living up to Sanders' expectations of her by lying though her teeth about emergency response times, with or without the Regents Road bridge. The bridge would never be built if Jarman simply told the truth about the area's emergency services.

Further, both Sanders and
Jarman know that building Regents Road bridge will financially crowd out any possibility of building a fire station in South University City. That is why she lied about the current response times. What an appalling lack of concern for public safety from a city's Fire Chief! Just like her boss, Sanders, she is 100% political.

To this day Dr. Arovas is "mystified" as to how Jarman got her numbers. Dr. Arovas is a College Professor while I am an observer of the political scene - Chief Jarman lied. It must come as a shock to college professors to discover that politicians lie and that they pick people for important positions simply because they are willing to lie on command.

But even for me, it was a breathtaking lie! She claimed that Engine 35 could currently get from Eastgate Mall to Regents Road and Governor Drive in 4.2 minutes. Remember that Deputy Chief and Fire Marshal Samuel Oates said: "Engine 35 can't get to the area on the North side in 6 minutes, let alone across the bridge to service that area".

In addition to crowding out financing for a new fire station, the Regents Road bridge will also crowd out financing for the much-needed widening of Genesee Avenue, which is why Marcia Munn's group, "UC Connection", supports the bridge - they live along Genesee.

Not surprisingly this group receive strong support from the Evans family through
David Cherashore, husband of Grace Evans and Executive Vice President of the family business responsible for "The MarketPlace in University City" - the economic interest the bridge is really all about.

The big winner in the City Council's abject approval of Item 334 on Tuesday was Project Design Consultants (PDC). It received a contract worth $4,861,373 "for the purpose of providing design services for the Regents Road Bridge and Limited Roadway Changes Project". The City Council showed an appalling lack of concern for public money. The horse-trading takes place on the 10th floor long before the Council meeting begins. Council meetings are staged events to fool the public into thinking they're being heard.

Donna Frye dodged the bullet of having to choose between her environmentalist friends and her North Clairemont constituents by pleading a conflict of interest arising out of her having the same attorney as Friends of Rose Canyon, Marco Gonzalez of Coast Law. She accordingly recused herself from the vote. The sole "nay" vote was Toni Atkins.

Patti Boekamp's staff told the Council that there was an "error" on Subitem-B of the proposed Ordinance. It should be corrected they said, from "for the purpose of preparing supplemental environmental document, obtaining permits, and providing design services for the Regents Road Bridge and Limited Roadway Changes Project" to "for the purpose of providing design services for the Regents Road Bridge and Limited Roadway Changes Project". There was no corresponding adjustment to the contract amount of $4,861,373. PDC was relieved of its duty to prepare a supplemental environmental document and obtain permits but was approved to receive the full amount nevertheless. Appalling!

The reason for all this, Boekamp's staff informed Council, is that PDC's environmental division has been purchased by another company. Therefore staff "has been advised to procure that portion of the project separately". Apparently it was not advised to deduct an appropriate amount from the figure agreed upon for the combined service. Perhaps it was the consultants themselves that so advised Boekamp's staff. Council could care less.

The Company that purchased PDC's environmental division is Helix Environmental Planning, Inc. of La Mesa. In a February 15, 2007 Press Release Helix was "pleased to announce that Bruce McIntyre will manage the Environmental Planning Group in HELIX’s La Mesa office". I wonder if Mr. McIntyre will bid for the environmental consultant contract. After all he knows that canyon well. He already got paid for doing a full project-level EIR while with PDC. Is he still with PDC? The Helix press release simply said that he would "manage the Environmental Planning Group in HELIX’s La Mesa office". He could do that while still working with PDC. I'm sure the City Council wouldn't mind him double dipping.

The way it is set up right now: the City Council will have to approve a new and separate environmental consultant agreement.
An RFP has been issued by the City. Proposals are due in by September 26, 2007. It will require the approval of another couple of million, which was supposed to be included in the $4,861,373. No doubt the Council will oblige.

When politicians want something done, which they know to be  corrupt, their co-conspirator consultants know how to make them pay. I tell you, it's tough being a political observer sometimes - it's like watching back-to-back episodes of the Supranos.
 

 
 

Atkins is treading water, hoping to stay out of jail after she leaves office. 09/02/07

 
                                                       by Pat Flannery                                        top^

If the Rose Canyon Bridge is a hot item for the Mayor on Tuesday, Agenda Items 332 and 333 are even hotter for certain Members of the City Council, especially Toni Atkins.

You will remember how she stormed out of a special meeting of the Audit Committee (of which she is unbelievably a member) convened on August 6, 2007, to craft a reply to this important letter from the SEC dated July 23, 2007.

We now know what spooked Toni so badly that she nearly broke the door down on August 6th. It was this Aguirre Interim Report # 18 entitled "The Adverse Domination of the Government of the City of San Diego". It is dated August 30, 2007 and making its first public appearance on the City Attorney's web site today.
Somehow Atkins must have gotten wind it was in the works. Aguirre's office is full of City Council spies.

First Aguirre outlines and explains the concept of "Adverse Domination". Then he goes on to recommend "a course of action by which the City can continue to initiate appropriate action to protect taxpayers and to fulfill fundamental legal duties owed to the people of the City of San Diego". If the City does not do that, it will prove his charge of "
Adverse Domination". It is vintage Aguirre. Atkins has every reason to be spooked.

Aguirre knows well that "the City", Sanders and the City Council, will not alter course. The City Council will not admit its disclosure lies and Sanders will continue to push the pension deficit under the carpet until he is out of office. Remember his bogus amortization schedule, where the deficit balance does not start to go down until 2012? If he were actually to pay off any of the pension deficit it would derail his entire administration.

So, it appears that Aguirre will bide his time until after Atkins and the others have left office, before accusing them of "violating the ant-fraud provisions of the Federal Security Laws" (as indeed the SEC has already done) and perhaps many other crimes against the City's finances. That should be enough to spook any elected official, even one as hardened as Toni Atkins. And apparently it has.

Toni now knows (from Aguirre's report)  that the Statute of Limitations does not run so long as she and her freshmen 2000 colleagues still dominate the City Council. They, acting as the Board of Directors of the Municipal Corporation known as the City of San Diego, abused their power for the benefit of their political supporters. Remaining on the City Council until the end of 2008 will not help them. Atkins clearly thought it would. She thought she could run out the clock on the Statute of Limitations.

What Aguirre's Report will do is bring into sharp focus what the Mayor and Council are NOT doing to pay off the pension deficit. By NOT addressing the pension deficit until 2012 the Mayor may be putting a noose around
the freshmen 2000 Councilmembers' necks. What does he care? These four City Councilors will have no defense after they leave office. They will fall right into Aguirre's "Adverse Domination" trap. Sometimes I wonder about the intelligence of politicians. I don't think these four have thought this one through.

What the SEC wants to see, is not some more Sanders-speak about the wonderful things he is doing to "reform the City". The SEC only cares about protecting its Wall Street investors. And protect them it will. The SEC is not as gullible as San Diego voters appear to be. The SEC wants to see real dollars going into that pension amortization schedule.

This is a draft of the Mayor's response he wants adopted by the Council on Tuesday. It is supposed to answer the
letter from the SEC dated July 23, 2007. But it is a long way from answering Aguirre's question about "Adverse Domination" and doesn't even mention the fact that the Mayor and Council continue to sweep the pension deficit under the carpet.

Who will want to employ an ex-Councilmember with a jail term hanging over their head? Zucchet and Inzunza got convicted of crimes for a whole lot less. Instead of helping the Mayor sweep the $1.3 billion pension deficit under the carpet, these four Councilmembers should be fighting for their lives by facing up to it. They should re-think their strategy.
 
 
 

Mr. Sanders, pull Item 334 off Tuesday's Agenda. It's political madness. 09/02/07

 
                                                       by Pat Flannery                                        top^

Here is a letter from the attorneys for Friends of Rose Canyon dated August 31, 2007. Note that it was faxed to the Mayor and all the City Council Members on Friday. Hopefully they will read it before Tuesday's vote.

It makes abundantly clear the extent to which the Mayor and Patti Boekamp have been willing to go to pervert State Law (CEQA) in order to ram the Rose Canyon Bridge through for the Evans family. That is why Boekamp was promoted. It is so reminiscent of Escobar-Eck and Sunroad. Just as Sanders instructed Escobar-Eck to lift the stop-work order on Sunroad (if he hadn't, he would have fired her), he has now ordered his new Director of Development Services to turn California law (CEQA) on its head on Tuesday.

Patti Boekamp has argued that the City needs to design the project in order to do an adequate EIR. If she puts forward that ridiculous argument on Tuesday we will know that nothing has changed - Sanders' chest beating and so-called reforms are all a sham. His administration still exists only to serve his campaign contributors. The people of San Diego who elected him because they thought he was a nice guy, are still being lied to. Tune in to CityTV on Chanel 24 Tuesday and watch the whole sordid proceedings.

Apart from Project Design Consultants' obvious sections
1090 and 87100 conflict of interest, as pointed out by Assistant City Attorney Karen Huemann in her July 24, 2007 legal opinion, a project-level EIR has not even been started! Here is the City's RFP. Proposals are not due in until September 26, 2007, with an estimated completion date of Oct. 2009. As the attorneys for Friends of Rose Canyon point out in their letter, it is illegal to start implementation of a project until a project-level EIR is complete. Project design is part of implementation. What is being proposed to City Council on Tuesday is illegal.

All previous environmental work has been program-level, not project-level. Confronted with a sure loss in court against Friends of Rose Canyon earlier this year, Boekamp had to concede this point. She had tried to pass off the program-level EIR as a project-level EIR. Again so reminiscent of Escobar-Eck and Sunroad.

The rush to spend $4.8 million of public money on the design of a Rose Canyon Bridge on Tuesday, before completing an EIR, is at least as corrupt as Sunroad, maybe even more.

There is one way out. The Mayor, if he has a scrap of political acumen left, will pull Item 334 off the Council Agenda this Tuesday. That's what he usually does when he gets caught. To proceed would be  politically madness, not to mention illegal.
 
 
 

Will the Rose Canyon Bridge be Patti Boekamp's Sunroad? 08/31/07

 
                                                        by Pat Flannery                                        top^

We all know that this city is run by a few very powerful people, but do we really understand just how powerful they are? Takes this man, Bill Evans, for example.

The Evans family has made a fortune using San Diego City public land. They own the Bahia Resort Hotel, the Catamaran Resort Hotel and the
Lodge at Torrey Pines.

At the Bahia, their hotel rooms open directly on to the city beach. At the Catamaran, guests get to use the city beach and dock through a lease arrangement with the City.

The family gets to berth its two commercial sternwheelers, the Bahia Belle and the William D. Evans, at its Bahia Hotel. These well-known sternwheelers ferry thousands of tourists around Mission Bay with stops, of course, at the Catamaran and the Bahia. This well-connected family must think of Mission Bay as its own private lake, which in many ways it is. It owns the best parts of it.


Then there is the family's Lodge at Torrey Pines. It opens directly onto the 18th fairway of the City-owned Torrey Pines Golf Course. It must also think of this championship golf course as part of its private Lodge hotel, which in may ways it is. T
hrough an arrangement with the City the family has the exclusive right to serve food and beverages to players on the Torrey Pines golf course. San Diego has been good to the Evans family.

It is not surprising therefore that the family is heavily involved in politics. They are big campaign contributors, the mother's milk of politics. Anne Evans' nephew, Richard Ledford, was Susan Golding's chief of staff.
The idea of a yearlong "contribution holiday" was first floated by him in 1994. So much for that "contribution" to the City's well-being.

And now there is the family's shopping center in Southern University City, at the corner of Regents Road and Governor Drive. It is called "The MarketPlace in University City".

Here is a satellite view of the Evans shopping center in relation to the proposed bridge over Rose Canyon. You don't have to be a leasing agent for Burnham Real Estate to appreciate the significance of that bridge to rental values in the Evans shopping center.

A Rose Canyon Bridge would miraculously move that relatively isolated local shopping center to within yards of the teeming population of Northern University City.



The amazing thing is the length to which City staff and politicians were willing to go to accommodate the Evans family. It is so revealing of how San Diego City works. A big player like Doug Manchester, Aaron Feldman, Bill Evans, John Moores, Alex Spanos or the McMillin family can tell the City what they want and the City jumps to it.

When Bill Evans said he wanted a bridge linking his shopping center with the densely populated Northern University City, the whole City swung into action: the Mayor, the Police Chief, the Fire Chief, everybody. It's enough to make your head spin (or your stomach turn).

Here is how he got the City Council to approve his bridge on August 1, 2006:

First Jerry Sanders makes a rare appearance in the Council Chambers to lobby for a campaign contributor, the Evans family. Then
its the turn of Fire Chief Tracy Jarman followed by the ever dutiful Police Chief Bill Lansdowne.

In her eagerness to please the power-elite, Chief Jarman falsely stated that a Rose Canyon Bridge would reduce the emergency response-time by 1.7 minutes. Fortunately she was challenged by an extraordinary public speaker, Dr. Daniel Arovas. She had to correct herself. She admitted that the response-time would be cut by only 0.5 minutes. A total of 30 seconds! Worth building a $30 million bridge for?

Of course she did not mention the fact that a fire station in Southern University City is the simple answer. But that's how you get promoted to Fire Chief in San Diego.

David Cherashore, husband of Grace Evans and Executive Vice President of the family business, made a PowerPoint presentation. It essentially said that the Rose Canyon was already dead from an environmental point of view and that those in opposition to the bridge were merely NIMBYs. He did not explain how he compiled his "for and against" list.

The Evans family attorney also made a presentation. Looking directly at her, he expressed confidence that staffer Patti Boekamp, would ensure the project's success.

If his confidence is well founded, north-western San Diego will have to forego a much needed upgrading of its main north-south thoroughfare, Genesee Avenue, to build a boondoggle bridge to further enrich a politically powerful well-connected family.

So, Patti Boekamp, faithful to her City training, put on the blinkers and stoutly defended the bridge on behalf of the Evans family. Bruce McIntyre of
Project Design Consultants, as he has so often done in the past, reminded the City Councilmembers that they can choose the project alternative that does the most environmental damage if they so desire.

Karen Huemann was not happy. She knew what was going on - that the City was being railroaded. Then the vote. We have the best rubber-stamp City Council money can buy.

That was last year, August 1, 2006. Now we are about to witness, this Tuesday, another installment in this ongoing puppet-show. It is quite fascinating.

Sadly, the lead puppet will again be Patti Boekamp. Sanders has promoted her to the job vacated by Marcella Escobar-Eck - Director of Development Services. Like many others, Marcella and Patti learned how to get along in this City - just do what you are told.

As promotable City staff must be known for their unquestioning obedience, hirable consultants must be known for their understanding of what the City wants.

Over the years two individuals,
Anthony J. Lettieri and Bruce McIntyre, have become very successful by knowing what the City wants. They were involved in the Petco Park project, Otay Ranch, Seaworld and many more.

A number of years ago they formed Lettieri-McIntyre and Associates. It was a small 15-employee firm when it merged with the 170-employee firm Project Design Consultants in June 2000. The merger caused controversy at the time because the marriage took place four days after the City contracted Project Design Consultants to do a land survey that ended up discovering an additional 26.84 acres in Mission Bay Park.

Lettieri and McIntyre understood why the City would spend $426,000 to add more land to its Mission Bay Park - the City can lease 25% of the surveyed land. It so happened that Lettieri-McIntyre and Associates were doing the Master Plan for SeaWorld's expansion at the time. Seaworld wanted to lease more land.

And so, the action before the City Council this Tuesday is to
authorize the payment of a further $4,861,373 to Project Design Consultants (PDC), "for the purpose of preparing supplemental environmental document, obtaining permits,and providing design services for the Regents Road Bridge and Limited Roadway Changes Project".

The City has already paid them $1.8 million to advice the City on the best alternative to solve University City's north-south traffic congestion. They picked a Rose Canyon Bridge as the best alternative, because that is what they were hired to do. These guys not only came up with the desired solution, they helped City staff sell it to the City Council.

On July 24, 2007 Assistant City Attorney, Karen Heumann, wrote a legal opinion pointing out that "the
purpose of PDC’s participation in the [August 1, 2006 City Council meeting] was to influence the Council’s decision to select the Regents Road Bridge alternative, and in turn to shape the content of the contract that PDC fully expected to receive as a result of that Council decision." She therefore concluded:

"Given these facts, while we have found Mr. Sullivan’s thoughtful analysis enlightening,
[Patti Boekamp had not liked the City Attorney's advice so she hired her own outside attorney, who coincidentally used to work for Casey Gwinn] we remain convinced that any contract awarding PDC the task of designing the Regents Road Bridge would be unlawful. We will not approve such a contract as to form and legality, as Section 40 of the City Charter would require in order for any such contract to be valid".

Unless we can make the rule of law prevail, we will continue to see senior staff like Escobar-Eck, Jim Waring and now Patti Boekamp, serve the power-elite rather than the people. The rule of law must prevail on Tuesday, not San Diego's entrenched plutocracy.

Will the Rose Canyon Bridge be Patti Boekamp's Sunroad? It should. Bill Evans has just taken the place of Aaron Feldman that's all. The question is: will she do what she was  promoted to do? If she does she will end up like Escobar-Eck. And she should.
 

 
 

The real problem: politics. 08/28/07

 
                                                        by Pat Flannery                                        top^

This Memorandum, dated August 23, 2007 from the Mayor's Office, promising systemic reform to prevent a repeat of the Sunroad scandal, makes interesting reading. When it is read together with the Mayor's announcement, dated August 24, 2007, appointing Bill Anderson as Land Use Chief, a clear pattern emerges - concentration of power.

The Mayor's announcement about Anderson says:
"he has overseen four divisions – Community Planning, Redevelopment, Economic Development, and Urban Form, plus San Diego’s Public Facilities Financing Group." It goes on: "his duties will expand to include supervision of the City’s Development Services and Real Estate Assets Departments." Now the developers will only have to lobby one powerful person.

Mr. Anderson is in charge of seven Divisions right now. The Mayor's Memorandum shows a clear preference for keeping it that way. It envisages rolling Planning and Development Services into one giant department. It says: "the merger of these two departments is looked at as part of their collective BPR’s (Business Process Re-engineering)".

But that flies in the face of the rationale given for moving Airports from READ:

"The Airports Department will now report to the Assistant Chief Operating Officer. The Airports Department was moved under the Real Estate Assets Department (READ) because of the number of leases managed by the Airport. While READ is separate and apart from DSD and Planning, this move did not take into account the inherent and/or potential conflict of interest created since all four Departments (Airports, READ, Planning and DSD) report to the same Deputy Chief Operating Officer, and information could be controlled at the Deputy Chief level and never elevated to the Chief Operating Officer or the Mayor."

Is there an "inherent and/or potential conflict of interest" when multiple departments "report to the same Deputy Chief Operating Officer"? If so, the Mayor's Remedial Memorandum is little more than double-speak - the Mayor is speaking out of both sides of his mouth. His remedial analysis fails to mention the most corrosive influence of all: politics. That's what caused the Sunroad scandal, not a systemic failure. The critical decisions were made right there in the Mayor's office, under the watchful eye of his political commissars, Fred Sainz, Kris Michell and Julie Dubick. That's why Froman quit.
 

 
 

Do City employees really have a Royal Prerogative? 08/27/07

 
                                                        by Pat Flannery                                        top^

Whoever answers the MEA call to:
"create an accurate and complete record of taxpayer costs, taxpayer savings if any; cost and service delivery matters in the office of the City Attorney under its current administration", will need to take into account this latest "taxpayer savings" wrought by the current City Attorney. Here is the judges order.

Judge Huff "dismissed numerous claims contained in the POA lawsuit alleging the City and certain officials, including City Attorney Michael Aguirre, violated the POA’s federal constitutional rights by eliminating or reducing vested retirement benefits."

The public employee unions seem to be operating under a different Federal Constitution from the rest of us. They believe they have a "federal constitutional right" to exorbitant pensions rights. Perhaps they think King George is still King of America and that they are his Court. I don't know how else to explain this concept other than as a Royal Prerogative.

Perhaps MEA General Manager Judie Italiano really believes she is Queen of City Hall.
 

 
 

In the interest of balance: Sanders and Aguirre's political contributions. 08/26/07

 
                                                        by Pat Flannery                                        top^

The "Voice of San Diego" ran two articles recently on the thorny issue of politicians accepting political contributions while in office, especially from people who have business before the City. It is a real concern to us all, so I decided to dig a little deeper.

The first Voice
article was on August 17, 2007 describing how: "A campaign committee that guided Mayor Jerry Sanders' ballot initiatives to victory in November has continued to raise thousands of dollars after the election from donors who have business in front of City Hall for a cause that is currently unknown".

The second
Voice article was on August 24, 2007 describing how: "To help capture a tight victory at the ballot box in 2004, Mike Aguirre spent more than a half-million dollars of his own money. With the help of supporters, he's finding a way to get paid back."

After reading the two articles I compiled the following four lists from campaign returns filed at the City Clerk's Office:

First:
Jerry Sanders' candidate contribution list for 2006, paying off his 2005 mayoral campaign, totaling $93,300.00; his Propositions B & C contribution list for 2006 totaling
$1,008,225.00, followed by his Propositions War Chest contribution list for January to June 2007 totaling $68,349.99, presumably to be used for his Charter Reform Initiative.

Second: Mike Aguirre's contribution list for the year 2006 totaling $6,721.97 and his contribution list for January to June 2007 totaling $14,080.00, both attempting to pay off his personal loan of $558,200 to his 2004 campaign for City Attorney.

It is hard to compare one with the other due to the massive difference in scale. The "Voice of San Diego" was simply trying to be fair to both politicians, as it should.

Scott Lewis of the Voice added this opinion piece on Friday August 24, 2007 (which brought out the Aguirre-bashers in droves - read the lurid comments). To support his premise that "
City Attorney Mike Aguirre helped make it an issue", Scott dug up this U-T article from 2004. It deals with Aguirre's objections to a campaign fundraiser planned by attorney Mike Conger (who was suing the City regarding the pension system at the time) for 2004 City Attorney candidate Leslie Devaney.

Scott Lewis is right, political fundraising while in office is a huge issue, no disagreement about that. Elected officials accepting political contributions from people who have business before the City, should be a major concern for all citizens.

Two loopholes made it possible for the above political contributions to take place:

(1) a recent law change, requiring
a candidate to pay off any personal loans to his/her campaign within six months after an election, was not backdated to 2004, when Aguirre's campaign for City Attorney took place. Therefore he has unlimited to time to recover his $558,200 personal loan to his 2004 campaign, the way it has always been.

(2) A General Purpose Recipient Committee, as "San Diegans for City Hall Reform" has apparently become, is much less regulated than the Candidate Controlled Committee it was when originally formed in 2006 for the support of Propositions B & C.

Read the San Diego Municipal Code on "Elections, Campaign Finance and Lobbying".

Here is a relevant quote from that section: "Committee means any person acting, or any combination of two or more persons acting jointly, who raise $1,000 or more, or make independent expenditures of $1,000 or more, within a single calendar year on behalf of or in opposition to a candidate or for the qualification to the ballot or adoption or rejection of one or more ballot measures. Committees include controlled committees, primarily formed recipient committees, and general purpose recipient committees."

I think §27.2903, Definitions, is particularly relevant: "Controlled committee means any committee controlled directly or indirectly by a candidate or that acts jointly with a candidate or controlled committee in connection with the making of expenditures. A candidate controls a committee if the candidate, the candidate's agent or any other committee controlled by the candidate has a significant influence on the actions or decisions of the committee".

This raises the question: is "San Diegans for City Hall Reform" controlled by Sanders' "directly or indirectly" or by "the candidate's agents"? Does Sanders', through his agents Jean Freelove and Tom Shepherd, have "a significant influence" on the actions or decisions of the "San Diegans for City Hall Reform" Committee? Of course they do! They run the darn thing! The same as they run his candidate campaign. They are inseparable.

Read this email from Jean Freelove to Steve Francis on April 16, 2007 and the attached contribution form for "San Diegans for City Hall Reform". It describes the aims and objectives of the Committee, which is to "support and oppose local ballot measures with the goal of reforming, restoring the financial stability and improving the efficiency of San Diego City government." As the Freelove email said: it is to "help Jerry".

So, in the interest of balancing the 2004 U-T article Scott Lewis "dug up" on Mike Aguirre, I dug up this 2006 U-T article on Jerry Sanders, making it crystal clear how the "pay-to-play" system works:

"On Oct. 13, Manchester Resorts gave $50,000 to a fundraising committee of the Lincoln Club of San Diego County, a Republican business organization that has long been active in politics. It was Manchester's second large contribution to the committee this year, after a $10,000 donation a month earlier, and it was the largest contribution to the club in 2006 by far.

Then on Oct. 17, the Lincoln Club contributed $70,000 to Sanders' campaign for Propositions B and C.

Two days later, one of Sanders' development services directors issued a report that concluded that no further environmental review was needed before Manchester's Navy Broadway Complex deal could proceed."

Contrary to media reports that Aaron Feldman only contributed $3,600 to Sanders campaign, the above contribution list shows that Sunroad contributed $10,000 to "Sanders' campaign for Propositions B & C". I hope the U-T and others correct this important fact for the record.

Also note that the Sunroad $10,000 contribution was dated 10/11/2006, just when the Mayor's office was fighting off the City Attorney, who was demanding the issuance of a Stop Work Order, as evidenced by this letter from David Miller to Jim Waring. In fact the City Attorney was recommending a full revocation of the building's permit at that time.

So, just as Manchester got his "no further environmental review needed" for Navy Broadway, Feldman got delay after delay for Sunroad. The "pay to play" system at work.

While I agree that Mr. Aguirre should rethink continuing his effort to recoup the $558,200 he loaned to his 2004 campaign, I think the Voice of San Diego should be less concerned about Briggs, Wilkes and Whitemore buying favors from the City Attorney's Office, with a collective contribution of only $800.00 between them, than the likelihood of a whole host of "no further environmental review" findings flowing from the pen of Bob Manis of Development Services, in obedience to his boss Mayor Sanders seeking to pay back those who contributed well over a million dollars to his "Propositions War Chest".

No doubt this "Propositions War Chest" will be used in an aggressive "help Jerry" Charter Change next June. It may explain why Jerry threatened "taking it to the people" every time he did not get his way at City Council - Freelove and Shepherd had a "Committee".
 

 
 

This shocker right in the middle of the fire season! 08/25/07

 
                                                        by Pat Flannery                                        top^

This message is currently on the San Diego City Firefighters (IAFF Local 145) web site: '
Los Angeles City Fire Department will be in San Diego recruiting fire fighter candidates from San Diego County this week. Representatives from LA City will be in the Local 145 CPR Room (10405 San Diego Mission Road, Suite 101) on Thursday and Friday (16th and 17th) from 8 am to Noon." I assume they mean August 16-17, 2007 - last week.

I wonder how many City Firefighters did we lose, courtesy of Firefighters' Union IAFF Local 145.

The Los Angeles City Fire Department was allowed to use our Firefighters' Union Hall to recruit firefighters away from San Diego!

Did
Fire Chief Tracy Jarman know about this? How does it reflect on her leadership? Are rumors of outsourcing affecting morale? Are they true?

Mayor Sanders needs to have an urgent word with Fire Chief Tracy Jarmen. If we have a major fire this Autumn this Mayor and this Fire Chief will have some explaining to do. Something's wrong here.
 
 
 

Patti Boekamp, just another "campaign contribution list" bride? 08/24/07

 
 

                                                      by Pat Flannery                                        top^

Today Jerry Sanders appointed two insiders as interim replacements for Jim Waring and Marcella Escobar-Eck: Bill Anderson to Waring's job and Patti Boekamp to Escobar-Eck's job. From an immediate management point of view these appointments make sense, they are each well qualified for the positions. The problem will be political if these appointments become permanent.

I wrote about a possible Anderson appointment to Waring's job on
August 15th: "Bill Anderson, before becoming Sanders' planning chief, spent 23 years with a private consulting firm called Economic Research Associates (ERA). He was its Principal-in-Charge for services to the City of San Diego Redevelopment Agency. He is still essentially a private-side guy, just another City-paid advocate for developers."

I continue to have grave reservations about where his heart lies: the private sector or government. So far, as Planning Director, he tended to see everything from his former clients' perspective. After 23 years you don't suddenly become a bureaucrat.

Anybody who frequents the City Hall Council Chambers knows Patti Boekamp. They may not know who she is, but they know that face. She is a striking blond/brunette with a "she-who-must-be-obeyed" set to a pretty face.

For a long time I thought she was a land use attorney or a lobbyist, she always seemed to be with the "customer" - i.e. the developer or builder.

Here is a quote from an interview she gave to the Engineering & General Contractors' Association (EGCA) when she was appointed Chief Deputy Director of the City of San Diego’s Engineering and Capital Projects Department in 2005:

"We want to continue our mutual understanding of each other, of this public-private partnership. I want contractors to know that I’m interested in them succeeding. I come from a contractor background, and my husband is a small businessman. I know first-hand about workers comp issues, insurance issues. And I know one other thing, that my uncle taught me. Government is in business to break even, but, ‘Unk’ would say, ‘I’m in business to make money, not break even."

Obviously, at least at that time, she saw government as a public-private partnership. The trouble with such a view of government is that the true "public" is not represented. Government becomes the tool of a few, in her case the contractors.

If that is still Patti Boekamp's government philosophy then we have another Marcella Escobar-Eck. Sanders' campaign contribution list again determined his selection.

That is why I recommended he go outside the County for key personnel. Here is what I wrote on
August 15th: "I doubt there is anybody in the entire city, that is qualified, who would not be seen as a shill of the developers. That's how bad the recent history of San Diego has been. Sanders' best bet is to look outside the County."

Patti Boekamp is part of San Diego's insider culture. She has been around since 1990. She served as the City Manager's Council Liaison. She worked for Jack McCrory and Susan Golding during the Republican National Convention and the two Super Bowls.

These are two photographs of her, both from Scott Peter's web site. They are celebrating the construction of a bridge and a wall in Scott's District.

                  
Patti on the left Patti on the right

Whichever side she is on politically, I wish her good luck. Hopefully she will settle down in the middle - if her job is made permanent, as I suspect it will be.

She has been handed a unique opportunity to raise the City above its narrow special interest politics of the past. We will get a feel for her management style as she starts to attend the Community Planning Groups around the City. That experience will be a far cry from the clubby atmosphere of the
Engineering & General Contractors' Association luncheons. We, the great unwashed, will find out what she really means by a "public-private partnership".

Let's hope she explores the real "public" side of that equation. If she talks down to us, as Marcella did, we will know that she is just another "campaign contribution list" bride.

As for Bill Anderson as Land Use Chief, he is just a charming version of Jim Waring. The developer-insiders are still in control. The old campaign donor list has prevailed - again. Maybe it's time to change the donor list. That would change
the personnel at City Hall.
 

 
 

Sanders today created a powerful enemy - Marcella Escobar-Eck. 08/23/07

 
 

                                                      by Pat Flannery                                        top^

Well, she's gone. Marcella Escobar-Eck is now officially in the private sector, where she always was, even while you and I were paying her salary. She quit or was fired yesterday.

These two emails from former Chief Building Official for the City of San Diego did her in.

Interestingly these emails, leaked to the Voice of San Diego yesterday, were not on the CD compiled by DSD and given to the U-T, me and presumably all other interested parties a few months ago, as a complete record  of all City emails pertaining to Sunroad.

Under the direction of Escobar-Eck, DSD had opted for that approach rather than waste staff time replying to endless public records requests. The media liked it because everybody (lowly bloggers, TV stations and the venerable U-T) were all working from the same data. These two emails were obviously withheld. That will make a lot of people mad.

Their leaking must have sent a powerful message to Marcella yesterday. She knew she had lost control; it was time to clear out her desk - Sanders wanted her out of the way.

But somehow I don't think he has heard the last of Ms. Escobar-Eck. She had put her entire life into working for the City. Her encyclopedic insider knowledge made her feel invulnerable. Unlike Waring, she did not consider herself "serving at the will of the Mayor".

Sanders is a classic example of "if they'll do it with you they'll do it to you". Today he did it to Marcella. That's what she got for doing it with an unscrupulous person like Sanders.

But the City and Sanders may not be done with this well-connected lady. She has more developer friends than Sanders. She did a lot of favors for a lot of developers while on the inside. She can do a lot of damage to the remaining insiders, if she chooses to do so.

Her departure will seriously damage Sanders' fundraising. As Fred Sainz might say: "this is the wrong message to send to the developer community". If I were Donna Frye or Steve Francis I would be calling my political consultant right about now. Sanders has damaged his core developer support and will have to compete on equal terms for the middle ground, which is where the next mayoral race will be won. San Diegans, both Democrat and Republican, want no more inside privileges - no more Sunroads.

Sanders' credibility went out the door with Escobar-Eck. Everybody knows she only did what she was told. She served Sanders as she served his predecessors. That's how the City trained her. It is ironic that both Hasenin and Escobar-Eck are now gone: one for refusing to do the Mayor's Sunroad dirty work and the other for doing it.
 

 
 

Sunroad abruptly withdraws second permit application today. 08/21/07

 
                                                        by Pat Flannery                                        top^

San Diego City Development Services Department received this letter from Sunroad today, withdrawing its application for the 14 story office building planned alongside its  controversial 12 story building. Is this connected with Jim Waring's departure?

Story's letter to DSD seems rather terse. His special relationship with the City may be over. Story also resigned from the Otay Mesa Community Planning Group last week.

Story's inability to deliver for Sunroad sends a message to all the developers - Sanders is not working out. With Jim Waring gone, DSD Director Marcella Escobar-Eck is now in the hot seat. She has long been the darling of the developers. Will Sanders promote her or fire her? His choice will define the second half of his mayoral term.

The developers will be on the phone to Sanders wanting to know if the wheels have fallen off the permitting bandwagon. Building permits were supposed to become available on a "will call" basis at the DSD window. That's what they paid for.

Sanders may tell them not to read too much into the Sunroad fiasco. He may dismiss  Aaron Feldman as a wild man; what happened applies only to Sunroad. He may then put Escobar-Eck in charge of all land use entitlements so that Jean Freelove can continue to send out these fundraising flyers. That would put the wheels back on the wagon.

We must never forget that fundraising drives politics (unless you have your own money like Steve Francis or the Kennedys). It is therefore much easier to predict what a politician who needs to raise money will do. In Sanders' case it is very easy.

Look again at the fundraising flyer. Notice the date: September 20, 2007.

What else happens on that day in San Diego? A three day Republican bash called the Western States Leadership Conference. Jerry of course is the guest speaker. Jean Freelove knows a thing or two about fundraising. Here is her email to Sanders' donor list.

But allowing Sanders to have a fundraiser as part of an important Republican statewide event raises serious ethical if not legal questions for the California Republican Party. What about other Republican candidates? Jean Freelove and Tom Shepherd have succeeded in turning this huge Republican event into a coronation of Jerry Sanders. That's not fair to the others and the Republican Party needs to be fair to
all Republicans.

People like Freelove and Escobar-Eck seem to be characteristic of the Sanders' style of politics. These two ladies take no prisoners. Jerry seems to like women like that. Janice Weinrick is another. But he may be overplaying his hand. We'll see.

 

 
 

The Mayor's Charter Committee is a power grab, pure and simple. 08/19/07

 
                                                        by Pat Flannery                                        top^

This August 9, 2007 meeting of the Charter Review Committee made three important recommendations:

1. That the trial for Article XV: "Strong Mayor", be extended to December 31, 2014 at which point Article XV, "Strong Mayor" shall be made permanent, unless voters approve a ballot measure repealing the Article, amending the Article or lengthening the trial period.

2. That the Charter should be amended to add three additional Council seats as soon as is practicable to make the total number of Council Districts 11.

3.
That the Charter should be amended to require a two-thirds Council majority vote to override a mayoral veto.

It would be hard to find a more cynical piece of misinformation, using double-speak, as the above: "
unless voters approve a ballot measure repealing the Article, amending the Article" . This is a deliberate attempt to mislead you. They want to make the "Strong Mayor" permanent in 2008 but lie to you that the trial period is being extended to 2014.

On
this so-called Sunset Provision, here is a video of Committee Member Alan Bersin (current Chairman of the San Diego Regional Airport Authority, formerly Schwarzenegger's Education Secretary and former Superintendent of San Diego Unified School Board), further spinning the sub-Committee's spin that made the recommendation.

Here is a video of Committee Member
Marc Sorensen (Senior Engineer and Program Manager for Space and Naval Warfare Systems Center) with a "troubled" view.

On whether to add more Council seats, here is a video
of Alan Bersin explaining the rationale for 3 additional Council seats to make a new total of eleven.

Here is a video of Marc Sorensen discussing the suitability of 11 Council seats. He says that if 11 seats is to be adopted, 7 would be a better number for a veto override as 7 is 64% of 11 while 8 is 73% and he considers that too high.

On the
mayoral veto override, here is a video of Alan Bersin explaining the issues debated in recommending a 2/3 majority for an override. He said he was "comfortable" with 8 votes even though it is a permanent 73% after the Council is expanded to 11 and 75% until that expansion goes into effect, which may be many years.

Here is a video   of Marc Sorensen with a well reasoned minority view. Sorensen is in favor of a higher vote for an override but is also conscious of representative government. He points out that our current Mayor was elected with 52% of the vote. When 5 Council Members vote at present that vote represents 62% of the Council. That should be enough to override this Mayor's veto. The Committee proposal is for 6 votes, 75% of the Council.

Finally here is a video of
Committee Member Glenn Sparrow, (a Professor at the School of Public Administration and Urban Studies at San Diego State University), with some concerns regarding preserving the integrity of Prop F.

It appears that this hand-picked Committee has been tasked with getting the maximum amount of power for this Mayor as early as possible. Its proposals would guarantee total power for a small cadre of insiders well into the future. Power would become so concentrated that they dare not lose it. That is what makes people become dictators.

Requiring a 75% vote to override the arbitrary veto of a man who received only 52% of the popular vote, is a naked power grab. 75% would become the norm to get anything passed. Everything else would be vetoed. That is dictatorship. Yet that is exactly what this Committee is proposing. They may as well have surrounded City Hall with tanks.

But can they get away with it? Not if the people know what is really afoot.

This cadre of insiders, led by veteran fixer John Davies, is exploiting the fact that people like the idea of an elected City Manager called a Mayor. This cadre is also exploiting the fact that the image of the City Council has been damaged severely by a period of scandalous misgovernment, largely attributable to an accumulation of power by a few unscrupulous public employee union leaders, such as Judie Italiano and Ron Saathoff.

Fortunately for the population it is easy to see the exploitive nature of what is being proposed. There is no reason to take the drastic measures being peddled by this power-grabbing Committee. The shallowness of their whole scheme is readily apparent.

There is no need to strengthen the already considerable power of the Mayor's office at the expense of the City Council. A strengthening of the Mayoral veto may well be a desirable thing but only by one vote over and above what is required to pass a Council resolution, and only after the number of City Council Districts has been considerably increased.

Increasing the number of Council Districts is of necessity a prolonged deliberate process. At the very earliest it cannot commence until after the 2010 Census has been tabulated, which will be 2011 at the earliest. In the meantime there are many things that need fixing, but increasing the power of the Mayor is not one of them.
 
 
 

The San Diego legal establishment is stacked against Mike Aguirre. 08/18/07

 
                                                        by Pat Flannery                                        top^

Can an outsider like Mike Aguirre ever expect to win a case as City Attorney in San Diego against this powerful cartel of legal insiders? They control the Sherriff's Office, the Chief of Police, the District Attorney's Office and the entire Superior Court bench. 

Could an outsider attorney ever expect to become a judge without the endorsement of this group?

Not a chance.

That is why the reality of Mr. Aguirre's election still comes as such a shock to them. How could it have happened?

This recent picture shows their grim determination to stand by an ex-Police Chief Mayor, against the people's City Attorney. They are still in shock that such a man of the people ever got elected.

Even Steve Francis, with all his money, is an outsider to them, which is all the more reason why he should run again for Mayor. He could help break up this dangerous power cartel. If he ran he would be doing an enormous favor for the ordinary people of this city.

Of course he would meet stiff competition from Donna Frye, who is already well established as a champion of the people. She lacks the financial resources of Francis, but it would be a great fight - two outsiders battling for the hearts of the ordinary people.

The 2008 city elections should be about insiders and outsiders - about how to break up the power elite that has controlled this city for decades. Aguirre's election in 2004 must not be just a once-off fluke. Aguirre confirmed as City Attorney topped off by a Mayor Frye or a Mayor Francis, would be a healthy change for this insider-dominated city.

But it must not stop at City elections, it must include judges.


Here is a link to all the Civil judges at San Diego's Hall of Justice and here is a link to all the Criminal judges at the Main Courthouse. Consider what would have happened in Aguirre's pension case and in his Tom Story case if a non-establishment outsider had sat on Judge Barton's Department 69 civil bench and another non-establishment outsider like Aguirre himself had sat on Judge Wellington's Department 55 criminal bench

One thing for sure, Aguirre would not be filing this appeal today. A non-insider criminal judge would not have gone out of his way to accommodate the above power group who broke every law in the book to prevent fellow-insider Tom Story, ex-Mayor Murphy's Chief of Staff, from getting served with a search warrant. The way these lawmen rallied round to protect Sunroad's VP, Tom Story, would make any ODC (ordinary decent criminal) blush.

If a "get-Aguirre-at-any-cost" judge had not turned the relevant law on its head and handed down an outrageously biased judgment that flies in the face of the legislative intent of a recently passed Assembly Bill, extending the statute of limitations in 1090 cases from one year to four years, the San Diego taxpayers would now be enjoying the benefits of an $800 million rollback of illegal pension benefits stolen from them by insiders.

But to the power elite that controls our judicial benches, "getting Mike" is more important than giving back $800 stolen millions to its rightful owners.

And they call themselves men of the law? And Mike Aguirre a mad man? It shows their contempt for the lowly taxpayer Mike represents. So how do we change it all?

By paying more attention to the election of judges!

Most of them go unopposed at election time. That's our fault. We should encourage honest lawyers to run for judgeships. Shame on us for leaving it all up to the establishment. We get what we deserve. And they laugh at us.

Look who is
still Judicial Appointments Advisor to Governor Schwarzenegger - John Davies (his wife, Patricia Davies had donated $16,150 to Schwarzenegger's election campaign). Davies has handled judicial appointments for Republican Governors since Pete Wilson first appointed him to that position in 1983. Most of his nominations get declared elected because nobody will run against them. Outsider attorneys are afraid.

Davies is the ultimate insider. He lives downtown and is an attorney with Allen Matkins Leck Gamble Mallory & Natsis LLP. He is a former president of CCDC, a former chair of the Planning Commission and is current chair of the Mayor's Charter Review Commission.

So there you have it. Aguirre or anybody like him has about as much chance of winning a case in San Diego County as I have of becoming President. It is interesting to note that his successes have all been outside San Diego County. He won the
De La Fuente case in the Court of Appeal in Riverside for example. Until we can get a few outsider attorneys to run for judgeships, Mike should file all his appeals outside San Diego County.
 
 
 

Who will replace Jim Waring? 08/15/07

 
                                                        by Pat Flannery                                        top^

Two City staffers Sanders may be tempted to tap as his new Chief of Land Use and Economic Development are Bill Anderson and Janice Weinrick. Both are problematic.

Weinrick lives with Lin Martin who is being sued by the City Attorney for fraud. Read Blogofsandiego dated July 25, 2007. If ever there was a conflict of interest it is in that Kensington household. She is next to Waring in Sanders' land-use hierarchy and her boyfriend is Sanders' real estate broker - manager of the Grubb & Ellis downtown office.

Bill Anderson, before becoming Sanders' planning chief, spent 23 years with a private consulting firm called Economic Research Associates (ERA). He was its
Principal-in-Charge for services to the City of San Diego Redevelopment Agency. He is still essentially a private-side guy, just another City-paid advocate for developers.

Who Sanders appoints as his new Chief of Land Use and Economic Development will say a lot about Sanders' political independence and moral compass. He has always said, especially in recent months as the spotlight fell on him, that it was his former COO, Ronne Froman, who chose Waring. Well this time it is entirely Sanders' call. Froman is no longer around to take the blame.

If he chooses either Anderson or Weinrick there will be an uproar in the non-developer community. I haven't even mentioned Escobar-Eck as that would be worse than inviting Waring back. It would be a red rag to a bull.

I doubt there is anybody in the entire city, that is qualified, who would not be seen as a shill of the developers. That's how bad the recent history of San Diego has been. Sanders' best bet is to look outside the County. Maybe Jay Goldstone knows somebody in Pasadena, where Jay came from in January 2006.
 

 
 

Goldstone may be Sanders' last best chance. 08/15/07

 
                                                         by Pat Flannery                                        top^

Sanders' administration came within a whisker of total meltdown Monday afternoon. It all hinged on Jay Goldstone. Look at what we know:

Mike Aguirre talked to Donna Frye on the telephone Sunday morning. She mentioned to Mike for the first time that Waring had contacted her the previous Monday. Aguirre saw the hidden hand of the Mayor. Mike knew that Waring was not acting on his own. Sanders has been treating Waring as his own private City Attorney ever since he hired him in January 2006. This meant more to Aguirre than it did to Frye. It was the straw that broke the camels back for Aguirre - the City could only have one City Attorney.

Mike fired off this letter to the Mayor, which put the cat among the pigeons. I and the rest of the media received the letter attached to this Press Release at 11:47 A.M. on Monday:

"This morning City Attorney Michael Aguirre sent a letter to Mayor Jerry Sanders regarding concerns that the City's Deputy Chief Operating Officer for Land Use and Economic Development has been "actively lobbying City Council members to procure support for a proposal to the Federal Aviation Administration (FAA) to permit the Sunroad Centrum 1 Tower ("Tower"), to remain at a height of 166 feet above ground level ("AGL") and, at that height, be declared not a hazard to air navigation at Montgomery Field Airport." In the letter, the City Attorney requests that the Mayor "take action to curtail further interference by the Deputy Chief in this very critical process."

This was really about curtailing Waring from acting as an un-elected City Attorney.

Jay Goldstone rose to the occasion. Many decades in municipal government paid off. His steady hand proved critical in the next few hours. He would have told his staff "get the Mayor and Waring on the phone no matter where they are".

He was able to talk to Sanders in Hawaii immediately, but was unable to raise Waring in Iceland. It was perfectly clear to Goldstone what had to be done. This time the Mayor had no choice but to listen to his Chief Operating Officer - Goldstone would have packed his bags on the spot if Sanders had sided with Waring. This was the critical moment.

After speaking to the Mayor, Goldstone acted quickly. Without waiting to hear from Waring he sent a reply to the City Attorney. Here is the letter. Again his experience shows. He said he was responding "on behalf of the Mayor". Obviously he had talked to Sanders. He used the word "we" have been unsuccessful in contacting Mr. Waring.

The Mayor had no choice but to distance himself from Waring's actions, which meant that Waring's goose was cooked and Goldstone would stay to steer the ship. If Sanders had faltered for a moment, he would have lost Goldstone. That much was clear to Sanders.

So who is Jay Goldstone? First of all let me say that I like him. He gave me the City's pension amortization schedule when he didn't have to. He could have stonewalled. Others would have. He is well regarded up and down the State in government financial circles.

He may be Sanders' last hope to save his administration from ignominious meltdown. It is just possible that given the appropriate authority Goldstone could weed out the sheep from the goats at City Hall and patch together an administration that would work for the good of the community instead of pandering to the insatiable appetite of the developers.
 

 
 

Sanders, Waring and Escobar-Eck risked their careers for this guy.  08/14/07

 
                                                         by Pat Flannery                                        top^

Normally I wouldn't get into somebody's divorce but there is a great deal of background information about the Sunroad corporations in these divorce pleadings. It also tells us something about the man that had such influence over Sanders and Waring.

Here is Elena Feldman's Brief as the Respondent in an Appeal brought by her husband Aaron Feldman in their divorce after 34 years. This is what it says on page 7.

"
Aaron was served with the Petition for Dissolution on August 19, 2003. On August 24, 2003, he, along with their two adult sons who work with him in the business, locked Elena in a bedroom in the parties' house overnight to coerce her into a settlement on terms very unfavorable to her. He removed the telephone from the wall when Elena tried to call 911, and refused to let her leave until she agreed to a full settlement on his terms, which included her moving out of the residence, not using the "Feldman" name after 34 years of marriage, dismissing her attorney, and not speaking to any attorney for five more months. Elena obtained a permanent restraining order against Aaron for three years as a result of this behavior."

Here is Aaron Feldman's Reply. My guess is that he will behave exactly the same in reducing the height of the building as he has behaved in his divorce - obstruct, obstruct.

All I can say is that the sooner this city hears the last of Sunroad and Feldman the better. How this guy ever got such influence over Mayor Sanders needs explaining. Did he give Sanders shares in some of his offshore corporations?
What did SawyerKnoll cover-up?

There are too damn many Delaware LLCs around here. Nobody knows who owns what.

 
 
 

Sanders still has a lot of explaining to do. Firing Waring is only the beginning. 08/14/07

 
                                                         by Pat Flannery                                        top^

If Sanders thinks he is out of the "corruption" woods by firing Waring with the flippant remark:
Jim's done a great job in some areas and in other areas, we all make mistakes", he is greatly mistaken. I for one have not forgotten Waring's sweetheart deal to Har-Bro Construction & Consulting Inc., a Nevada Corporation, and I don't intend to forget it.

Waring sold 2.09 acres of prime developable City land at 5415 Market Street, to a private developer, Har-Bro Construction, on January 12, 2007 for $300,000! Har-Bro started construction immediately. Try doing that as an ordinary developer. The 2.09 acre site now contains two handsome, brand new 15,000 square feet light industrial flex/office facilities, ready for occupation. For a land acquisition cost of $300,000!  In 6 months!

Here is the Grant Deed signed by Jim Waring (on page 8 of 17), posing as an Assistant Executive Director of the Redevelopment Agency. Presumably all the real Assistant Executive Directors refused to sign it, just as the City's real building inspector refused to sign the infamous December 21, 2006 letter lifting the Sunroad stop work order that DSD Director Marcella Escobar-Eck then signed herself.

Today Waring sent this email to his friends at the City calling Escobar-Eck, who lifted that Sunroad stop work order, a "huge community asset, doing a great job for the city". What is he smoking there in Iceland? His "culture of negativity" means getting caught.

No, Mr. Sanders you still have a lot of explaining to do. You will need more than
the now-discredited Jo Anne SawyerKnoll to whitewash over Waring's sale of 5415 Market Street. The corruption in your administration goes much deeper than Sunroad.

And the people want more than an "Aw shucks, we all make mistakes" from their Mayor.

 
 
 

"Boy, did I get a wrong number" - Jim Waring. 08/13/07

 
                                                         by Pat Flannery                                        top^

Donna Frye confirmed to me this evening that Jim Waring contacted her last week asking her for help in getting Sunroad an extra 6 feet above the FAA's mean-spirited 160 foot height limit. Sunroad is in her Council District but Waring had treated her like she didn't exist - he had never consulted her about Sunroad before. What was her reaction, I asked.

Movie fan Donna laughed and said that not since Bob Hope, playing an Oregon real estate agent and family man dialing for dollars, mistakenly called a voluptuous French actress played by Elk Sommer holed up in a local motel, was a dialing error so hilarious.

In the 1966 movie, "Boy, did I get a wrong number", zany Phyllis Diller kept Bob Hope from getting killed by his wife if she had discovered the seductive French lady. But it will take more than a Phyllis Diller to keep Waring from getting canned when he returns from vacation. My advice to Jim is "don't call home", enjoy your vacation as long as you can.

Why? Because Jay Goldstone dashed off this letter to Mike Aguirre this afternoon. Goldstone is now Waring's boss. He took over from Ronne Froman as Chief Operating Officer (COO) when she resigned. Waring is directly under Goldstone on Sanders' staff.

If Mr. Waring was acting without the Mayor's knowledge or approval, Goldstone will have to discipline him, even fire him. But if the Mayor backs Waring, Goldstone will have to resign. The Mayor will therefore have to choose between Waring and Goldstone. Either way he is going to lose a top aide. Boy did Waring get the wrong number! What was he thinking calling Donna Frye, when he had denied her any role in Sunroad for so long?

Sanders to Waring:
"Well, here's another nice mess you've gotten me into". Yes, the Sanders administration is looking more like a Laurel & Hardy show every day.
 
 
 

The Mayor is still lying to us about Sunroad. Why? 08/13/07

 
                                                         by Pat Flannery                                        top^

While he was publicly assuring us that he was diligently trying to get Sunroad to obey the law and chop off the top 20 feet of that building, privately he had his Deputy, Jim Waring, running around City Hall trying to
schmoose the City Council into accepting a 166 foot building. Not only has the FAA said that it will not accept an inch above 160 feet but here is a letter from Mike Aguirre warning of the legal dangers of such backroom shenanigans.

By now you have all read this article in Sunday's U-T discussing how the Mayor's
Sunroad Report is at odds with the record. I would like to supply some source documents to support the U-T story. I have received quite a few emails requesting me to do so.

(By the way, I posted all these emails on my blog months ago.)

The U-T says: "
E-mails show that Halbert and Broughton received a detailed outline of the FAA's concerns June 19, 2006, the same day the FAA notified a senior city planner that the building, planned for 180 feet, would be a hazard to pilots landing in bad weather."

Here is that e-mail. It was sent by Development Services staff person Tait Galloway to his boss Kelly Broughton and DSD Director Gary Halbert (before Marcella Escobar-Eck took over). How can the Mayor say that his senior staff didn't know about the FAA's concerns?

Here is the FAA email referring to the telephone conversation that prompted Galloway's email to his boss. Notice that Broughton had also received it direct from the FAA.

The U-T goes on: "
The next day, Sanders called Halbert and Waring to a meeting in his office." Here is the page from Sanders' diary confirming this meeting. But according to Fred Sainz: I can tell you with certainty that that meeting had nothing to do with Sunroad.” Sainz is fast running out of credibility.

The immediate result of this high-level meeting in Sanders' office was this Construction Permit dated July 7, 2006. I guess Tait Galloway got his answer - politics rules.

What does Aaron Feldman have over Sanders anyway? Surely Sanders is not risking his entire political career for a measly campaign contribution. There is something more going on here than we read in the U-T or anywhere else.

Did Tom Story bring more than development experience with him when he went to work for Feldman? Feldman knows everything there is to know about development. What guys like him crave is some "leverage" at City Hall. Did Tom Story bring some "leverage" with him from City Hall? Does he know where some bones are buried?

The fact that Waring is still scurrying around City Hall trying to keep Feldman happy seems ominous to me. Both Sanders and Waring would have long ago told Feldman to go pound sand if he didn't have something over somebody. Development is a rough game.
 
 
 

Council Candidate April Boling got a free ride at the Realtors today. 08/09/07

 
                                                         by Pat Flannery                                        top^

As a 30 year veteran of the San Diego Association of Realtors I went along this morning to the monthly meeting of its Government Affairs Committee. I am not a member of that Committee (you can't just apply, you have to be asked). But I have made a habit of turning up as a guest during the political season, going all the way back to when Maureen O'Connor (Mayor Mo) first ran for Mayor against Roger Hedgecock i
n 1983.

You can imagine my surprise and dismay this morning when I was asked to leave while they interviewed April Boling. I had turned up in May when they interviewed Carl DeMaio with no problem. What was different with Boling? I was looking forward to asking her about the prospect of amortizing the $1.2 billion pension deficit. She was on Murphy's Blue Ribbon Committee that reported on the pension problem. She knows it well.

I know she is friends with Mike Mercurio, the Realtors' Director of Government Affairs. They are fellow directors of the San Diego Taxpayers Association. Did Mercurio contrive to keep me out in order to ensure a friendly interview for Boling? If she needs that level of protection, Marti Emerald will chew her up in the election debates. Or will she only go to friendly debates, like those arranged by the Lincoln Club or the Chamber of Commerce?

Mike Mercurio informed me that they recently made a new rule excluding everybody but Government Affairs Committee members when interviewing candidates for political office. We are not allowed to know what secret promise Boling and others made in order to get at the Realtors' pot of money. It is more likely to benefit builders than neighborhoods. If elected Boling will vote against every environmental appeal that will come before her.

The Realtors Political Action Committee (PAC) is one of the richest sources of political largesse in the County. This tightly-held Committee requires its members to sign an agreement keeping its deliberations secret - from the entire Realtor membership! Developer-friendly Republicans DeMaio, Boling and Thalheimer will get all that dough.

Republicans seize control of pots of money like the Realtors PAC despite the fact that much of it comes from Democrats and Independents. As of May 1, 2007 there are
576,400 registered voters in the City of San Diego. 221,947 or 38.5% are Democrats and 190,659 or 33.1% are Republicans. 137,267 or 23.8% are undeclared. I expect the Realtor population reflects the total population, that at least some are Democrats.

Yet, in a secret process, a select group of very aggressive Republicans interviews and endorses the candidates of their choice, spending tens of thousands of $$$ contributed by thousands of Realtors, none of whom have a say in selecting a candidate to endorse.

Does this happen with trade associations and business groups all across the city? Surely not every builder is a Republican. Yet we all know who controls the BIA. Are there no Democrats in the Chamber of Commerce? Yet we all know who controls the Chamber.

Maybe Democrats are just too nice. Republicans seize control of anything that has money. It's not that they contribute more money than Democrats, they just seize control of what money there is. The Association of Realtors is just an example.

So how are Sherri Lightner, Marti Emerald, Steve Whitburn and other Democrats going to get a chance at that Realtor money? Is it hopeless? Maybe not. They should ask every Realtor to call their Association and demand a role in endorsing city candidates.

And any candidate invited for an interview with the Government Affairs Committee of the Association of Realtors should require that such an event be open to any Realtor member who wishes to attend, irrespective of political affiliation. Is that too much to ask?
 
 
 

Atkins storms out of Audit Committee meeting. 08/08/07

 
                                                         by Pat Flannery                                        top^

Councilmember Toni Atkins' unbelievably arrogant response to this important letter from the SEC dated July 23, 2007 was to storm out of the special meeting of the Audit Committee convened last Monday, August 6, 2007, to craft a reply. How did one of the prime perpetrators of this City's securities fraud get on the Committee charged with correcting it? This woman has to go. She has done enough damage to our City.

If the City's response to the SEC is to have any credibility, Atkins has to leave the Audit Committee immediately or be fired. No one person should have the power to damage the reputation of a city of 1.3 million people. Atkins clearly does not care a fig about anybody or anything other than herself. She epitomizes what is wrong with this city
. She is still covering up the fraud she perpetrated. Why do we allow this to continue?

Here is a video of the City Attorney's stunned response. You can actually hear the door slam behind Atkins as she storms out. This is a new low even for San Diego.
 
 
 

The Mayor's dirty little budget secret - an inevitable pension tax? 08/07/07

 
                                                         by Pat Flannery                                        top^

How long will it be before the City "shall" impose a pension tax? That was the theme of a press conference held by City Attorney Mike Aguirre yesterday.

Charter Section 76: "....
the Council, if necessary, shall levy annually a sum sufficient to meet the requirements of the pension funds herein provided for the Police and Fire Departments and the City Employees’ Retirement Fund." Notice it says "shall" not "may". But when will it become "necessary"?
Here is a much shortened video of Aguirre's presentation.

His key exhibit was this document. You may remember reading it in my May 8, 2007 blog shortly after I managed to get it out of the Mayor's Chief Financial Officer, Jay Goldstone. Jay personally faxed it to me. As far as I know I am the only person who requested it.

I requested it because it is the key to understanding how Mayor Sanders is attempting to do exactly what his predecessor Mayor Dick Murphy attempted to do - push the entire pension problem under the carpet until he leaves office.

Mayor Sanders (eagerly supported by the Union-Tribune) has portrayed the pension issue as Mike Aguirre's personal vendetta against the city's public employee unions. If only it were that simple. The problem is real and will have to be dealt with, one way or another.

If Aguirre does not prevail in court with his attempted rollbacks, there are only three possible outcomes: (1) cutbacks; (2) taxes; (3) bankruptcy. Not much to celebrate there.

Aguirre's main point yesterday was that cutbacks are taxes by stealth. I agree with his logic. Less of anything for the same money is a cost increase. Therefore less government service for the same tax money is a tax increase. We are simply paying for so-called "unfunded" pension benefits in reduced city services. There is no free lunch.

The deficit "amortization" column on the Mayor's pension cost chart could buy a lot of city services, services we are now forced to do without.

Without a pension tax the Mayor's deficit "amortization" column will not just reduce city services, it will eliminate them completely! You can't keep sweeping a problem like that under the carpet forever. And time may be shorter than Sanders thinks. Ask Dick Murphy.

As I explained in my May 8, 2007 blog,
the Mayor's deficit "amortization" schedule has huge negative amortization! It doesn't even pay the interest until after 2010! And what happens in 2010? It is Sanders' last year in office. So, under the carpet it all goes until Jerry retires to Rancho Santa Fe among the millionaires he created while in office.

"But wait" you say. There is always bankruptcy. When the City can no longer provide essential services it simply declares bankruptcy. Wrong. You can't declare bankruptcy if you have an alternative remedy. And the remedy is and always will be - TAXES!

If the Mayor is ruling out bankruptcy (which he is) it is not because he believes he can balance the City's books without a tax increase, it is because he knows that bankruptcy will never be an option. Our City Charter says we "shall" pay for what we spend.

Mayor Sanders knows that sooner or later the deficit will come home to roost in a pension tax - but not on his watch. Was that his secret instructions to Jay Goldstone? If so, nice plan Jerry, but you're not in Rancho Santa Fe yet. Time is against you.

 
 
 

Who's going to be King? Business or Communities? 08/02/07

 
                                                         by Pat Flannery                                        top^

The 2008 elections will be a watershed in San Diego history. Will our little slice of paradise become a playground for the rich, or continue as a livable American city? Right now its livability is under threat. The gulf between the "haves" and the "have-nots" is widening because even politicians from the poorer districts are catering to the "haves".

Our problem is not so much that we have a Kevin Faulconer, a Jim Madaffer or a Brian
Maeinschein but that we have a Tony Young and a Ben Hueso.

Let's assume that Sanders will hang on to the Mayor's Office for another four years (an outcome that is by no means certain). Let's also assume that Mike Aguirre will still be City Attorney. What then will our city government look like in 2009?
 
Donna Frye, Tony Young, Ben Hueso and Kevin Faulconer will make up the older half of the City Council. The new half will decide the future of the city. That's why this is a watershed election.

There are two very distinctive types of candidates emerging. District 5's Carl DeMaio epitomizes one and District 1's Sherri Lightner epitomizes the other. DeMaio is the ultimate insider, while Lightner is the ultimate outsider. Let's take a look at them.

First DeMaio. He is a nice guy. As far as I know he is clean and is his own man. But he represents something ominous. He represents the growing symbiotic relationship between business and government. All over the free world business has by and large succeeded in taking over governments. Government is DeMaio's business.

The once socialist haven, Great Britain, is now run by the business community. The Labor Party is now the party of business. There is no counterforce. Tony Blair once said "there is only room for one conservative party in Britain and that's the Labor Party". He meant it.

Don't get me wrong, I am not anti-business. I am a businessman myself. We all are, one way or another. But is government a business? Should it be run on business lines? Or are the two quite different? I believe they are. I believe government is an art and transcends business. In fact I believe that a society, including its business community, succeeds or fails depending on how well it practices the art of government. The difference between San Diego and Tijuana is a perfect example - the difference is government, pure and simple.

Should we surrender the art of government to young gung-ho businessmen like Carl DeMaio or should we continue America's quest for better government, as community activists like Sherri Lightner of La Jolla wants us to do, which is why she is running?

In business circles "government" has become a dirty word. "Business" is King. But what is "business"? Since it became synonymous with "government" it is little more than the method by which insiders rig the bidding in what used to be free enterprise. In other words "business" has by and large eliminated free enterprise by using "government".

But that's how Third World countries work! Is that where we are headed? Will San Diego become like Tijuana? Maybe not quite, but the trend is clear. Even our Police Chief and District Attorney serve the business establishment. Why, even the unions and environmentalist organizations are headed that way. Nothing is simple any more.

In each of the four up-for-grabs City Council Districts the philosophical lines are clearly drawn. On the business-serving side are Carl DeMaio in District 5 opposed by community-serving candidate Mitz Lee; long established business-serving figure April Boling opposed by (soon to be announced) community-serving candidate Marti Emerald in District 7; business-serving wannabe Phil Thalheimer opposed by community-serving candidate Sherri Lightner in District 1 and finally, hand-picked by Price "Charities" boss Jack McCrory (who has not given up on his City Heights "
Vision Plan") Todd Gloria opposed by (hopefully) community-serving candidate Steve Whitburn in District 3.

My apologies to all the others but those are the eight I consider to be the front runners. I may be totally wrong about the candidates but the cultural differences are real.

Assuming we have irretrievably lost Hueso and Young to the so-called "business" world, those of us who care about our communities and the quality of our neighborhood life, better pay attention to the race for these four seats. Right now the only City Councilor we can only rely on is Donna Frye. Hueso and Young have horrible records in fighting for their communities and neighborhoods. They have become mere suits for the business community, while Kevin Faulconer remains securely tied to Sanders' coattails.

The communities must stand and fight their ground, one by one. The City's Development Services Departments (DSD) is the primary battle ground. It is now officially an "Enterprise Fund". This vital City department has become a stand-alone business entity. It is no longer part of the General Fund therefore no longer subject to City Council budgetary control. The developer community owns it. Permit fees pay for the staff's Lexus cars.

The elected City Council, who by State law must sit as the Redevelopment Agency, has surrendered its powers to two developer-dominated corporations - CCDC and SEDC. The unelected boards of these two powerful corporations, together with DSD, make all the land use decisions for this city. The City Council is becoming more and more irrelevant.

If this trend continues we will become a city of inner "haves", enjoying the best this magnificent area has to offer, surrounded by an outer ring of "have-nots" with little to distinguish their communities from Tijuana. It is already happening. All the socially undesirables, like affordable housing and social services, are being driven out of Downtown and East Village. If you have money in San Diego County there are only two things you can do now - move downtown or buy in a North County gated community.

DeMaio, Boling, Thalheimer and Gloria want to become part of this privileged inner ring. Let's hope the others have a strategy to defeat them. The future of this city is at stake.
 
 
 

Citizens can act as Attorney General to stop the corruption. 08/01/07

 
                                                         by Pat Flannery                                        top^

How many know of the "
private attorney general doctrine"? Here is its relevant statute:

"
CALIFORNIA CODE OF CIVIL PROCEDURE 1021.5.  Upon motion, a court may award attorneys' fees to a successful party against one or more opposing parties in any action which has resulted in the enforcement of an important right affecting the public interest if:  (a) a significant benefit, whether pecuniary or non-pecuniary, has been conferred on the general public or a large class of persons."

The State of California encourages its citizens to actively pursue the public interest. It encourages us to be our own Attorney General. Nowhere is that statute more welcome than right here in San Diego. If Bonnie Dumanis will not act, then we will do it ourselves.

But we need a good attorney. Cory J. Briggs is knowledgeable and willing to file this kind of lawsuit. In fact he has chosen to specialize in it because he cares about the public good. Relying on §1021.5 he invests his time and skills, working on a contingency basis for the public benefit. If successful, the State assures him that he will recover his billable hours.

Hopefully his successes will lead to a more widespread use of this great doctrine.

Yesterday he filed this law suit against San Diego City's Southeastern Economic Development Corporation (SEDC) to force them to cough up the sale documents on two Agency-owned properties at 5335 and 5415 Market Street. Read my blog dated 07/16/07.

Then read my blog dated 07/03/07 on the same parcel of land, particularly the part where
Jim Waring "sold" lots 15 & 16, i.e. 2.09 acres, to Har-Bro Construction on January 12, 2007 for $300,000. That's right. $300,000! Here is the Grant Deed.

SEDC President, Carolyn Smith, read my blog and wrote an "explanatory" letter to Jim Waring on July 11, 2007. Cory Briggs also read it and put in a Public Records Act request for all the relevant documents. They ignored him, not a good idea, hence his law suit.

Carolyn Smith's "explanatory" letter to Waring raises more questions than it answers. It completely ignores the $500,000 profit made by Artie M. Owen (a.k.a. "Chip" Owen), current chairman of Southeastern Economic Development Corp. (SEDC). Nor does it explain why Jim Waring sold the 2.09 acres to Har-Bro Construction for $300,000. I drove by the property on Monday. Two 15,000 square foot buildings are almost complete.

The developers who elected Sanders are getting their money's worth, but the SawyerKnoll hardware store may be running out of whitewash.
 
 
 

Mr. Mayor, your credit card has just been declined. 07/31/07

 
                                                         by Pat Flannery                                        top^

Today, Attorney Cory J. Briggs of the Briggs Law Corporation filed this complaint
in the San Diego County Superior Court, alleging that the Redevelopment Agency (RDA) of the City of San Diego has failed to prepare and file its "annual report" for fiscal years 2003, 2004, 2005 and 2006 as required by California Health & Safety Code § 33080.1(a).

Mr. Briggs is asking the court for a writ of mandate prohibiting the RDA from receiving or expending any funds and incurring any debt unless and until it fully complies with Redevelopment Law. He had made a Public Records Act request for these reports but the RDA was unable to produce them. He assumed they did not have them. He was right.


Then Briggs sent this letter to Mr. Christopher Cox, Chairman of the SEC, advising him of his complaint. Mr. Cox made a speech last week in Los Angeles in which he referred to the fact that the SEC had sanctioned San Diego
for having committed securities fraud.

According to Cox in LA:
"San Diego’s new procedures will cover disclosures it makes in its financial statements, its continuing disclosure agreements, and its disclosures to rating agencies." But how can it comply if its Redevelopment Agency has not filed financial reports for 2003 thru 2006?

Here is the California State Controller's Community Redevelopment Agencies Annual Report for the fiscal year ended June 30, 2006. Note that on page iv bottom of the page it says: "Redevelopment agencies for the cities of Chowchilla, Clearlake, Commerce, Crescent City, Cudahy, Isleton, King, San Bruno, San Diego, and Sierra Madre failed to file their audit reports for the 2005-06 report year".

The same for 2005 (bottom of page iv), 2004 (bottom of page iv), 2003 (bottom of page iv) - no reports filed by San Diego.


Our city's officials' contempt for the law is breathtaking. Briggs law suit may stop all City borrowing until Mayor Sanders does what he was elected to do - clean up the City's act.

Donna Frye recently refused to "accept and file" the 2003 and 2004 Consolidated Annual Financial Reports (CAFR) because they did not contain a Redevelopment Agency Report. CFO Jay Goldstone gave her evasive answers as to why they were not included.

Mayor Sanders hired the well-connected Goldstone as his Chief Financial Officer. Guess who is on the
California Debt and Investment Advisory Commission (CDIAC) - Goldstone! In addition to auditing himself as his own City Auditor, Mr. Goldstone also "advises" and "monitors" himself as a member of State CDIAC. "Insiders only" need apply for Sanders' city jobs. But he may be running out of options. You can't run a city if you can't borrow. 
 
 
 

Is Sanders backing away from Grubb & Ellis? 07/28/07

 
                                                         by Pat Flannery                                        top^

Sanders wrote this letter to the City Council yesterday. Does he want to dump Martin as his real estate broker and have Fred Sainz figure out how to spin it? That's how I read it.

If, as the letter states, the local Grubb & Ellis firm is "merely an affiliate (meaning that they pay an annual fee and nothing else) of the national company", then there is no agency conflict. Is the real conflict Weinrick/Martin, not the Grubb & Ellis name, with which Martin has been playing loose and free in defiance of real estate law?

Martin is in breach of California Real Estate law by using the business name of Grubb & Ellis while still registered under his own name with the Department of Real Estate. Here is his license. There is no mention of him being affiliated with Grubb & Ellis. He is even the designated broker for a corporation called
Jennifer S Hankins Inc. and is the employing broker for that Jennifer S Hankins as an individual. You can't do any of that if you are an associate licensee of another broker. You become subject to that broker's supervision.

Here is a list of the 83 licenses affiliated with Marc Doyle, the designated broker for Grubb & Ellis. Lin Martin is not one of them. Martin is not subject to the supervision of Marc Doyle and therefore cannot use the Grubb & Ellis business name. That's Real Estate law.

It would be like me saying I was a Coldwell Banker agent while remaining an independent broker, outside the control of Coldwell Banker. Do insiders not have to obey the law too?

Martin and Weinrick have been the ultimate insiders for years. Aguirre's fraud suit against Martin is really an attack on insider cronyism. It is time somebody did it. District Attorney, Bonnie Dumanis protects these people. It's her job to shield the powerful and prosecute the weak. That is why Community Colleges', Constance Carroll, placed the Lin Martin scandal in the sure hands of her insider-sister, Bonnie Dumanis. Like all "successful" people around town, they both serve the Establishment and get well paid for it.

Thank goodness for bull dog Mike Aguirre, the champion of us outsiders - he is not going to let go of this bone. And when he has brought Lin Martin's insider dealings to light, I hope he looks into Collier International's Victor Krebs' handling of the block next door on behalf of City College. Is that an insider job too? Krebs managed to turn a "speculators" profit of $5.4 million for his client Intergulf between March 1, 2005 and February 8, 2006.

Intergulf acquired the property for a total of $14,900,000 on March 1, 2005, then sold it without alterations to Dr. Carroll's Community College District for $20,300,000 on February 8, 2006. Perhaps the good Chancellor can explain how her much-flaunted "public process" allowed this $5.4 million "speculator" profit. No doubt she will dump the matter into the black hole of Dumanis investigatory never-never land, never to be heard of again.

Sanders must be regretting having attempted to satisfy the voracious appetites of these super-aggressive real estate brokers. I deal with their like every day and know that they will do anything to turn a commission. Grubb & Ellis was fined $3,000 by the Ethics Commission in 2006 for illegal contributions to Mayor Sanders' campaign.

Now that he has put Monday's Council action on hold, he should kill the whole idea of using brokers. It would be one less scandal to explain away next year. He should go back to the traditional "publish and bid" system. It is not like everybody in the commercial real estate world does not know that these city properties are for sale. If he is unable to rise above this kind of crude cronyism we will know that he is hopelessly enslaved to his campaign contribution list. That perception will haunt him at the polls next year.
 
 
 

Aguirre sues live-in boyfriend of top Sanders' staffer Janice Weinrick. 07/25/07

 
                                                         by Pat Flannery                                        top^

When Aguirre sued Sunroad on December 15, 2006 I wrote a blog welcoming Mike back into the fold. I felt he had become too cozy with Sanders. He had.

If that lawsuit was a legal hand grenade rolled under the door of the Mayor's office (it eventually sent the smartest of them, Ronne Froman, running for the exit), then this lawsuit against Lin Martin filed yesterday, is a stink bomb. Who knows who will come tumbling out of the Mayor's office this time. It must be getting awful smelly in there.

It should be only a matter of days before
Janice Weinrick (appointed in February 2007 by Mayor Sanders to "oversee 11 City-managed redevelopment project areas throughout San Diego, encompassing more than 7,600 acres and representing more than $2 billion in investment underway and in the pipeline") needs to "spend more time with her family".

Because according to this article in the San Diego Metropolitan magazine, the Mayor's number one real estate staff person's "family", Lin Martin, is being sued by the City Attorney for fraud. Even for Sanders' cop-hardened nose, THAT stinks, especially when the guy is also the Mayor's real estate broker (I will have more about that in a future blog).

I wonder how long concerns for his credibility will allow Sanders to hang on to Weinrick. Right now he is creating full employment for columnists like Gerry Braun in today's U-T, who is not buying his Sunroad story. Will Braun buy his Weinrick/Martin story? Sanders' credibility problem should be good for many more witty pieces by Braun.
Hmmmmm.
 
 
 

CCDC served its client, Manchester, well today. But it may not be over. 07/25/07

 
                                                         by Pat Flannery                                        top^

As expected the five member CCDC board voted 4 to 1 to rubber stamp Manchester's Navy Broadway project today. They were too far invested in this project to turn back now.

Manchester can start excavation work for the Navy headquarters building immediately because, by its decision today, the CCDC board has ruled that he does not need a permit from the California Coastal Commission. That was the purpose of today's meeting.

One of the biggest land use decisions in the history of San Diego was made by four non-elected officials. This once-in-a-century decision was not even worthy of recording by CityTV, Channel 24. My little YouTube camera and a lone Channel 10 reporter were all there was to record this historic event.

But this developer-compliant board may not be out of the woods yet. They may even have sown the seeds of their own disbandment. It is intolerable that a developer-serving body like CCDC can put on a show like they did today and thumb their noses at the citizens of San Diego and the California Coastal Commission. The citizens of this great city need to take back control of government from the developers and their hand picked "officials".

Nancy Graham dealt with my discovery of her coached Perry Dealy letter by saying that it was distributed to the board. Yes it was, but only AFTER I discovered it. She tried to avoid today's publicity by putting this historic decision on the Consent Agenda!

The Coastal Commission is not going to be pleased that it has been side-stepped. Can CCDC ignore the pending law suit that will decide whether the Coastal Commission has jurisdiction over this site or not? When Manchester goes before the judge, after having started construction, His Honor may not be amused.

It is all so reminiscent of Sunroad, even the same aggressive attorney, Steve Strauss.

The other unpredictable factor is the City Attorney. Can Mr. Aguirre stand idly by while CCDC tells Manchester to go ahead without a Coastal Commission permit? The City Attorney may have learned a few lessons about City officials ignoring higher government agencies like the FAA and the DOT. There may be an injunction in Manchester's future.

Aguirre may not wait for a letter from the Coastal Commission telling him that the building is illegal. He has to protect the City. Attorney Strauss's MO is to start the building and ask questions later. This time Aguirre may deal with the State agency earlier. With Sunroad, it was not until the State Department of Transportation (DOT) weighed in that Aguirre acted. DOT would have sued the City if Aguirre had not sued Sunroad.

He may wish to prevent a similar situation arising by getting an injunction to stop Manchester putting a shovel in the ground pending the outcome of the Manchester vs. the Coastal Commission jury trial. Otherwise Aguirre will be in a terrible pickle if the court rules that Manchester needed a Coastal permit after all - CCDC and DSD will do the usual thing and blame the City Attorney. By then it will be too late for Mike.
 
 
 

Nancy Graham DID coach Perry Dealy in writing that letter. 07/25/07

 
                                                         by Pat Flannery                                        top^

The U-T did a story today confirming that Manchester was coached in writing the letter that temporarily took condo-hotels out of his Navy Broadway submittal in order to side-step the Coastal Commission
: "CCDC President Nancy Graham said she asked Manchester to write the letter about deleting the condo-hotel language".

Nancy Graham requested that
letter as a CYA, but nobody was supposed to see it until after today's hearing, otherwise it would have been in the staff report. It is not.

Nancy Graham knows that this is not about condo-hotels per se, it is about dodging the Coastal Commission bullet. She is an advocate for the developer, not the 1.3 million people of this city. She is still a land use attorney at heart, not a civil servant.

But the cat is out of the bag now so it is up to the 1.3 million to make their voices heard at 2:00 P.M. today at City Hall. I think we can safely rely on the fact that it will be "pulled" from the Consent Agenda.

The plan was to have a "
Special Real Estate Committee Meeting" last Friday, July 20, 2007 (where nobody even asked the purpose of the meeting), which would allow the matter to be summarily dealt with at today's CCDC full Board Meeting - she actually put it on the Consent Agenda! The Consent Agenda is meant to contain routine matters that are voted upon collectively. Nice try Nancy.

Hopefully by now a sufficient number of honest citizens have been alerted. Hopefully a sufficient number of public speakers will question the motivation of the (almost hidden) Graham/Perry
letter. It would be nice if our public servants were on our side just once.
 
 
 

Manchester's insider letter to CCDC avoids a Coastal Permit. 07/23/07

 
                                                         by Pat Flannery                                        top^

Here is the CCDC Agenda for this Wednesday, July 25, 2007. Item 10 is a "Consistency Determination for the Navy Broadway Complex Amended Master Plan".

When you have finished reading the Superseding Master Plan (it was called the Amended Master Plan on Friday) that is attached to the staff report and when you have carefully compared the "Amended" or "Superseding" version to the original Master Plan, let me know what they have changed. If you haven't got a copy of the original Master Plan you will need to go down to CCDC and pay 25 cents per page. Got all that?

Yet that is exactly what representatives of C3, a citizen group that is suing Manchester, did today. Eli Sanchez, the Navy Broadway project manager for CCDC, loaded them up with enough paper to sink the carrier Midway. I hope they find whatever has been "Amended" or "Superseded" before Wednesday.

These "Amendments" must be important because they required a special CCDC meeting on Friday, with 3 hours of Board discussion. Then it was put on the Agenda for the regular monthly meeting this Wednesday. Why didn't staff just list the Amendments? The staff report said that the Amendments were "minor" (yet they required two meetings of CCDC).

I wondered what was buried in this "Superseding" Master Plan that they didn't want us to discover. So I too went down to CCDC today. On a hunch that what they were hiding had to do with Manchester avoiding having to get a Coastal Development Permit, I engaged in "20 questions" with Eli Sanchez. He is very good. He managed to evade my questions for quite a while. We even swapped a few jokes.

But in the end I guess he didn't want to take the risk of denying the existence of a relevant letter from Manchester dated July 19, 2007, in case I might discover it later.

So here is the letter, courtesy of "20 questions". I think it is the little nugget they were trying to hide from us, under a mountain of smoke, mirrors, meetings and staff reports.

It is to
Helen Holmes Peak, Esq., Partner, Lounsbery Ferguson Altona & Peak LLP, attorneys for CCDC, from Perry Dealy representing Manchester Pacific Gateway LLC, a Delaware Limited Liability Corporation (which, as you know, could be anybody).

The letter is short and precise as to its intended effect. Either Mr. Perry is an exceptionally gifted CEO or he was coached by CCDC. The letter was all CCDC would need to "Amend" or "Supersede" the Master Plan Consistency Determination Matrix, deleting a key paragraph that made reference to the possibility that Manchester might be required to seek a Coastal Development Permit. How ingenious.

Perry deleted all reference to "condo-hotel" or "office-condo" from his Submittal for a Consistency Analysis "without waiving the right to amend the Submittal". He can put "condo-hotels" and "office-condos" back in, once he gets his Consistency Determination. A little window into how CCDC play the game on behalf of its developer clients.

So that's what this Item on CCDC's Agenda this Wednesday is all about. It is for the City to set up Manchester's Navy Broadway development project in such a way as to avoid a Coastal Development Permit. All the rest is smoke and mirrors.

Somehow I managed to ask the right question of Eli Sanchez today. But I am not sure it will do any good. The CCDC Board will no doubt approve the Superseding Master Plan on Wednesday, minus the offending paragraph in its Master Plan Consistency Determination Matrix (Perry Dealy seems to be an expert on CCDC's "Matrices").

How could any citizen watchdog group be expected to pour over so much paperwork and find what they are hiding? They play cat-and-mouse with us. I just got lucky today.

The thing that bothers me the most is that Manchester's CEO, Perry Dealy, could never have figured this out on his own. San Diego's top developers are not entrepreneurs. They are not risk-takers. They just own top level staff at DSD and CCDC, that's all.
 

 
 

Madigan and City College President, Terence Burgess, are neighbors. 07/22/07

 
                                                         by Pat Flannery                                        top^

The Madigan/Nieto flip of City College land is still making headlines. Here is something that might help explain what went on. The President of City College is Terence J. Burgess. He supervised the putting together of the City College Master Plan.

Did Mike Madigan and Nieto know about the College's intentions before anybody else?



I did an ownership search and came up with tax Assessor's info on Burgess and Madigan. It turns out that they are neighbors in a ritzy downtown condominium complex called Parkloft. See the above picture.

Now I am not suggesting that everybody in that complex knows each other, nor that the Burgess's in 406 are always popping in to the Madigans at 508 for coffee and doughnuts. But it is possible that they know each other. It just seems like an interesting coincidence to go right along with Jim Waring and "Aaron" for this week's Sunday Funnies.
 

 
 

Jim Waring was involved with Sunroad as early as April 2006. 07/21/07

 
                                                         by Pat Flannery                                        top^

I have been reading and hearing Jim Waring tell the media that he was not informed about Sunroad until October 2006. Then I remembered seeing an email showing that Waring was involved with the Sunroad project as early as April 2006. So I did a little digging.

I came up with an email dated July 28, 2006 showing that Mr. Waring had a meeting with some "Sunroad bigwigs" a few months earlier. The email was from John Cruz answering a question from his boss, Kelly Broughton, as to whether Waring was involved with Sunroad. Cruz had included Waring in an email regarding Sunroad and Broughton questioned it. Was Broughton protecting Waring from all things Sunroad? Was he told to do so?

But this email dated April 17, 2006, from Waring himself, supports Cruz's assertion. In it Waring seems quite familiar with "Aaron", as he refers to Mr. Feldman, Sunroad's owner.
 
 
 

Where is our civic pride? 07/21/07

 
                                                         by Pat Flannery                                        top^

Only one San Diegan turned up yesterday to protest this civic giveaway:



                                                San Diego Bayfront

                                                     Chicago Bayfront


                                                       Miami Bayfront

You will remember that Manchester sued the California Coastal Commission (CCC) for declaratory relief from having to obtain a Coastal Development Permit (CDP). Here is the full brief filed on June 15, 2007. Here is my blog commenting on it at the time.

The suit says: "Manchester contends that its rights to develop the project is vested consistent with the Development Agreement and Guidelines are vested and that the only remaining approvals required of the project are from CCDC and the City".

Representing the CCC, State Attorney General Jerry Brown, responded:
"the [Coastal] Commission cannot be sued in federal district court under the circumstances presented here", that the U.S. District Court therefore "lacks jurisdiction".

Manchester sued the entire Commission personally: Peter M Douglas, Steve Blank,  Sara Wan, William A Burke, Steven Kram, Mary K Shallenberger, Patrick Kruer,  Bonnie Neely, Mike Reilly, Dave Potter, Khatchik Achadjian, Larry Clark, Ben Hueso and Sherilyn Sarb. That should endear him to San Diego's own Ben Hueso and Pat Kruer.

The sooner this important case is decided the better. No matter which way it goes it will have far-reaching implications for California's sovereignty. If Manchester and the Navy win, it will gut the Coastal Commission. California will not be master in its own house.

As the above pictures show, a Delaware LLC (which could be anybody) is privatizing the last remaining piece of public land on our waterfront. It will be a civic tragedy of monumental proportions. The "suits" were there in force yesterday but only one private person turned up to protest this giveaway. We are losing our chance for a Chicago-style or Miami-style waterfront civic park because we have no civic pride. It's as simple as that.

The Navy and its greedy contractors are stealing this priceless 14 acres for their posh Headquarters and adjoining contractor offices. Their luxury hotels and central paseo will become a private playground for the wives of every crooked military contractor in the free world. While the Navy brass and their contractors sign their deals in the offices above, their ladies will stroll and shop along the paseo below - the Rodeo Drive of San Diego.

How can the Federal Government claim to still control the land it signed away in a 99 year lease to Manchester? A 99 year lease is as good as freehold. Jerry Brown should come down to San Diego and personally argue this case on behalf of all the people of California.

 

 
  The Sunroad Report is out. But the zoning breach remains unexplained. 07/19/07  
                                                         by Pat Flannery                                        top^

Here is the complete Mayor's Sunroad "Investigation" released today. My comments are in red. It blames everything on "process". Nobody did anything wrong.

If it was failure of "process" it was because Sanders hired his own Attorney, Jim Waring, who has been playing City Attorney ever since.

I watched Sanders at his press conference today. Surprisingly, Mike Aguirre turned up. If I were Mike I would have left Sanders to spin himself out of this one on his own.

I wondered if Aguirre had actually read the "Investigation". How could he have been so nice to Sanders knowing that he was trying (unfairly in my opinion) to blame Mike's office for much of the problem - being "unresponsive"?

I personally believe that Sanders hired Jim Waring to neutralize Aguirre because Mike was not part of the "team". Waring has made his contempt for Mike clear from the moment he took up employment for Sanders. The problem was that Deputy City Attorney David Miller was part of the "team" until Aguirre finally fired him on February 27, 2007.

Waring's spin is that he and his staff requested legal advice from Aguirre even though Waring made it abundantly clear, particularly to DSD, that because Aguirre was not part of the "team", his legal advice was neither to be sought nor followed.

The "Investigation" does have some suggestions however. Observing that "separating vision from implementation" is not a good idea, it recommends that DSD and Planning be amalgamated into one Department. That would be interesting, I wonder how Community Planning Groups would fare out. It would be a bit like merging the Legislature and the Executive. Maybe that will be Sanders' next proposal. Why do we need a City Council when the Mayor's Office can do the whole thing. It would make Fred Sainz' job simpler.

Also observing that the first concern for airports should be safety, not their development potential as real estate assets, it suggests that airports should be moved from the Real Estate Assets Department to Public Works. They should fit right in there with things like Miramar Landfill and Recycling. I wonder what that's all about. Did Sainz write that too?

So for me the problem remains: how did a 306,000 square foot building get approved on a 1.47 acre lot where the zoned Floor Area Ratio (FAR) is 0.50?. That was not addressed in the Mayor's "Investigation". Height is a just one component of intensity of use, which is what determines land value - the more improvements you can put on a piece of land, the more valuable it becomes.

Purchasing land zoned for a low intensity of use, then having it rezoned to a higher intensity, is how fortunes are made in real estate. Don't let them kid you, it is never speculation, it is always inside dealing. The last thing speculators do is speculate.

Sunroad purchased a 1.47 acre parcel of land, 64,033 square feet, which under existing intensity of use (FAR 0.50) allowed for 32,016 square feet of building space. Sanders' office then granted Sunroad permits to build 306,000 square feet, making the land worth 10 times more than it cost. Sunroad intends to
sue the City if, by lowering the height of its intended buildings, it can only multiply the value of its 13.87 acres by 9, instead of by 10.

That's
what the Mayor's Sunroad "Investigation" does not tell you.
 
 
 

This recently acquired SEDC property needs careful watching. 07/18/07

 
                                                         by Pat Flannery                                        top^

This 8.5 acre site was specifically acquired by SEDC for affordable housing:



The land at Euclid and 94, now vacant, was acquired by SEDC
"for the purpose of developing affordable housing", according to this SEDC Report to City Council that resulted in SEDC obtaining the NOFA funds to assemble the parcels.

Here is a rendering from a DDA involving developer Barone Galasso that has now been abandoned by SEDC. The DDA was for 120 affordable dwelling units and 50 market rate single family homes. Another developer,
Reese Jarrett, tried to take over the DDA and change it. Here is a letter from his attorney, Janice Brown. He requested "the flexibility to develop the site for retail or mixed use purposes". SEDC rejected the proposal.

But SEDC's consultants,
Keyser Marston Associates Inc., has now posted an RFP on their web site, which says on page 4, under Development Guidelines: "SEDC does not have a preference as to the ultimate use of the Property". They don't?

This development project needs watching. If NOFA funds were used to acquire the site "for the purpose of developing affordable housing", then that is what needs to happen.

If SEDC intends to adhere to its NOFA commitment, to develop only affordable housing, only those bidders who know of this restriction stand a chance of getting accepted. If SEDC does not intend to abide by the NOFA commitment and intends to seek approval from City Council to switch the funding, SEDC should have disclosed that in its RFP.

SEDC has given itself the option to go either way - and justify it later. Knowledge is gold. Does one particular bidder know what SEDC intends to do? If somebody does, then that somebody will be the successful bidder and there is a lot of public money at stake.

The developing partner will be offered a substantial "incentive" to develop the site. This land is worth many times what SEDC paid for it. SEDC has not obtained an independent appraisal. It may be planning on giving the land at acquisition cost to the developer. That would be a huge giveaway to a private developer. In view of the Redevelopment
Agency sale of 2.09 acres at 5415 Market Street, to Har-Bro Construction on January 12, 2007 for $300,000, such a giveaway is perfectly possible. I hope people will be watching.
 

 
 

SEDC needs a thorough investigation. 07/16/07

 
                                                         by Pat Flannery                                        top^

As a result of my investigation into the Redevelopment Agency's sale of 2.09 acres at 5415 Market Street, San Diego, to Har-Bro Construction on January 12, 2007 for $300,000, I was invited by SEDC President, Carolyn Smith, to a meeting in her office on July 13, 2007. Here is an "explanatory" letter she wrote to Jim Waring on July 11, 2007.

This is the recent history of the property:

On May 1, 2000 an Illinois Corporation named Federated Industries Inc. sold 5335 and 5415 Market St. to Caravan Properties LLC, a California Limited Liability Company owned by Artie "Chip" Owen, current chairman of Southeastern Economic Development Corp. (SEDC). Here is the Grant Deed. The purchase price was $1,800,000.

On the same day, May 1, 2000, Chip Owen sold it to the San Diego Redevelopment Agency for $2,300,000, a profit of $500,000. Here is the Grant Deed. He had quitclaimed it to Caravan Properties and Artie Owen on the same day. Here is the Quitclaim Deed.


In her letter to Mr. Waring, Ms. Smith made no mention that Mr. Owen had "flipped" the property for a profit of $500,000 in 2000. Her answer to my various questions was that Mr. Owen was not on the Board of SEDC in 2000, therefore it was OK.

Ms. Smith wrote to Waring: "April 2000, the Redevelopment Agency approved a Purchase and Sale Agreement with Mr. Artie Owen (Caravan Properties, LLC) for the purchase of 4.4 acres at 5335 and 5415 Market Street for $2.6 million." I checked the RDA Agenda for April 2000. Here is the Minutes of the April 2000 meeting. There was no such approval.

In a report dated July 5, 2006, SEDC-06-008, Ms. Smith told the City Council sitting as the RDA, that "The proposed Third Implementation Agreement will provide for the assignment and assumption of the obligations of the Developer by Har-Bro" and that it will "Revise the Schedule of Performance to allow Har-Bro to carry out all the obligations under the DDA."

The Developer mentioned, TayRad, was long gone. It had
sold the only part of the original property it had acquired, 5335 Market Street, to 5335 Market St. LLC, owned by Gustavo Spoliansky of 1307 Palisades Beach Rd., Santa Monica, on July 22, 2002.

Nowhere in her Report to City Council did Ms. Smith seek permission from the RDA (who still owned 5415 Market Street because TayRad had not bought it) to sell it to Har-Bro, at any price. Yet 5415 Market Street was sold to Har-Bro. The Grant Deed was signed by Jim Waring. Was it authorized? I can't see how it could have been. Not only was TayRad gone but the proposed sale transaction was grossly misrepresented to the City Council.

In my conversation with Ms. Smith she repeated what she had told the City Council (sitting as the RDA) that Har-Bro "purchased the balance of the responsibility of the DDA". In her Report to City Council and her "explanation" to me, the words "obligations" and "responsibility" were cleverly used to disguise the fact that Har-Bro received 2.09 acres of valuable land for $300,000. Did the members of the City Council know they were approving a sale of 2.09 acres for $300,000 on July 11, 2006? I doubt it.

But Ms. Smith got her approval, based on her SEDC-06-008 Report. Is that how it is done? If so, Smith, Jim Waring and Chip Owen need to be investigated. Har-Bro paid more than $300,000 - to somebody. The real world doesn't work that way. This is a disgrace.


 

 
 

The final blow to Sunroad. It's over. 07/14/07

 
                                                         by Pat Flannery                                        top^

Here is the City's DENIAL of a Substantial Conformance Review (SCR) approval for the second phase of Sunroad's three phase office complex at Montgomery Field, known as Sunroad Centrum 14. This means that the City's previous approval of phase one, known as Sunroad Centrum 12, was granted illegally. This was inevitable. The law is the law.

Read my blog dated June 03, 2007. Here is Sunroad's Application for Substantial Conformance Review (SCR) for Sunroad Centrum 12's compliance with the
New Century Center Master Plan. The City found Centrum 12 compatible but Centrum 14 not compatible. They were right the second time.

Did DSD Director, Marcella Escobar-Eck, finally refuse to do the dirty work for Sanders, who according to the City Attorney is corrupt? If so, wise woman. If not she has problems because Sanders will blame her for Sunroad Centrum 12. We'll see.

The FAR (floor area ratio) within the the Kearny Mesa Community Plan area is 0.50. That means that you need a whole acre to build 21,780 (43,560 divided by 2) square feet of office space. Sunroad Centrum 12 would have needed 14.05 acres (306,000 X 2 = 612,000 divided by 43,560 = 14.05).

Therefore the Sunroad Centrum 12 permit for 306,000 square feet was illegal.



The entire site is only 13.87 acres. That is 604,177 square feet. Half of that is 302,088. Ignoring the fact that parcel 6 is dedicated to the SDG&E substation, in granting a permit for 306,000 square feet for Centrum I, the City used up all the available 302,088 and then some. They had no choice but to deny Centrum II.

For those of you knowledgeable enough to be wondering why this particular SCR is a Process Two: it is a condition of the original Master Plan. Here is the relevant page. And for those of you who like to read everything, here is the Master Plan (it is a very large file).


The only ones who could have made this project legal are our eight City Councilors voting to approve a special use permit. They were not asked. Mike Aguirre cannot make it legal by arbitration or mediation or whatever they are calling the talks that are taking place. The extra 20 feet the FAA objected to was never more than a side-show. The real issue remains compliance with our Municipal Code. You can't "negotiate" that.
 

 
 

Frye, Sunroad, Gaylord and "capricious characters". 07/12/07

 
                                                         by Pat Flannery                                        top^

I have had numerous emails asking for my "take" on Donna Frye's change of heart regarding the Wal-Mart/Superstore controversy. I have not spoken to her about it, so I risk getting it wrong. But I feel she is such a public figure that her actions should be judged solely in the public context. So here goes.

Nothing in politics can be viewed in isolation. The Gaylord issue was playing out as Ms. Frye was making her final decision regarding Wal-Mart. The Sunroad building permit issue, which is in her Council District, was coming to a head those very same days. In my mind they are all inter-related because they speak to who governs our cities.

Gaylord exposed an unacceptable level of union power regionally. It should be up to the people of Chula Vista, or any other city, to decide whether they want to spend $300 million of their own tax money to get a $1 billion tourist and convention facility in their city. The people of Chula Vista didn't get to make that decision. The unions made it for them.

Sunroad exposed an unacceptable level of developer power. It should be up to the normal permitting process of the City of San Diego to decide the height and density of any building project within the jurisdiction of the City of San Diego. A portion of the Municipal Code called the Land Development Section decides such matters. In the case of Sunroad, a developer, with access to the Mayor's office, decided it for the people of San Diego.

Frye may or may not be running for Mayor in 2008. I don't think that is what drove her decision. What is different about her political persona is that she does have an unerring sense of what is best for the city as a whole. I am not sure other elected city officials always look beyond their own narrow interests.

Bob Kittle today acknowledged Frye's contribution to political sanity in San Diego but damned her at the same time. He came up with
a "Mother Jones" analogy, including an unflattering photograph, followed by a typical Kittle nasty remark "We offer this bit of trivia because it simultaneously sheds light on Councilwoman Frye's capricious character".

Rising above the Kittle level of political discussion, we can see the overall context in which Frye made her decision. She is saying that we need to trust our current institutions of government. She is right. We have a very fine Municipal Code, the accumulated decisions of decades of elected City Councilmembers. To quote Winston Churchill: "
It has been said that democracy is the worst form of government, except all the others".

Frye did not cave in to pressure from any interest group. She made a thoughtful decision to let the Land Development Section of our Municipal Code determine whether and where a superstore should be permitted. If a Wal-Mart Superstore can stand up to the rigors of a full Environmental Impact Review, which is required for every large development project, then it belongs in our city. If not, it doesn't. Let us be a government of laws, not of men.

That is why I connect Sunroad, Gaylord and Wal-Mart together in my analysis of Frye's decision. I have watched her public performance over the years and I think I can guess what was going on in her mind when she made that decision. I think she wants us to trust our institutions of government. If we don't, what have we got left?

Bob Kittle may be on the right track regarding a "capricious character", but he is barking up the wrong tree. He needs to look a little closer to home, at insiders who admire pompous people in bow ties. Donna is of the people and I hope she does run for Mayor.
 
 
 

Was the Community College District involved in "insider" deals? 07/10/07

 
                                                         by Pat Flannery                                        top^

I went along last night to the Community Oversight Committee (COC) of the Community College District to watch how that Committee oversees the District's spending of
the Proposition "S" $685 million and the Proposition "N" $870 million, a total of $1.555 billion.

At meeting's end I used the non-agenda public comment segment to direct the Committee's attention to how District staff had acquired the land for the three huge building projects that had been the subject of sophisticated slide show presentations by project architects all evening.

I informed the Committee that the
1027 15th Street property had been on the open market for 113 days for $795,000 and that during repeated failures of a subsequent escrow the listing agent had offered the property to the District at $750,000.

Responding immediately to my public comments the Chancellor, Dr. Constance M. Carroll, told the Committee that she could categorically say "that the property was not offered at that price". She attempted to close down any questions by the COC.

She may dispute the listing agent's word (though he is willing to swear before a Grand Jury), but she can not deny that the property was listed in the San Diego Association of Realtor's Multiple Listing Service (MLS) throughout the time the College was in the process of acquiring all the properties on that block. Why did she wait and purchase the property for
$1,284,375?

Methinks the lady doth protest too much.

She went on to say "we follow a public process regarding the acquisition of property, not a private process". She wallowed in a fatuous explanation of the difference between a so-called "public process" and a "private process", as if somehow that explains why she paid
$534,375 more than the amount for which it was listed in the MLS.

Watch the video
  (unfortunately the recording conditions were not ideal).

According to Dr. Carroll, the "public process" inevitably allows speculators to make a profit because they become aware of the District's intentions.

According to the seller, the fact that everybody knew the District was committed to its purchase, kept ordinary buyers away.

Did the "speculators" who finally bought it, Madigan and Nieto, know they could turn around and sell it to the District for a substantial profit? Is that what Dr. Carroll means about a "public process"? Does Dr. Carroll's "public process" mean that the public agency gets to choose who the inevitable speculator will be? Sounds like "insider" dealing to me.

But that was a mere $534,375 speculator profit. What about the $5.4 million profit made by Intergulf Development (Broadway) LLC, a Delaware Limited Liability Company, on the block next door? Was that inevitable too?

Intergulf acquired the property for a total of $14,900,000 on March 1, 2005, then sold the exact same property, no alterations, to Dr. Carroll's College District for $20,300,000 on February 8, 2006. Perhaps the good Chancellor can explain how a so-called "public process" is responsible for this $5.4 million speculator profit.

Intergulf assembled the property by purchasing 10,000 square feet from Singing Serpent Inc for $2,800,000 (here is the grant deed), 15,000 square feet from the Laframboise family for $3,700,000 (here is the grant deed) and 30,000 square feet from SGKS Properties LP for $8,400,000 (here is the grant deed), all on the same day, March 1, 2005.

Intergulf then sold all three parcels to the College District on February 8, 2006 for $20,300,000 (here is the grant deed).

Three months later, in May 2006, the San Diego Metropolitan magazine reported that Intergulf had "
halted plans to build 360 residential condominiums". Why would Intergulf purchase a 55,000 square feet site to build 360 condominiums at a time when everybody knew that the College District was committed to purchase it, as part of its Master Plan? How come they picked on that particular block? The sellers would have known that the College intended to buy it. Did Intergulf, or its agent Victor Krebs, represent that it was purchasing on behalf of the College? It is usually not that easy to get three such large property owners to sell on the same day. Did they really think it was for condos?

Did Intergulf (and Madigan and Nieto) know they could turn around and sell their acquisitions to the College District for a substantial profit? Is that what Dr. Carroll means by a "public process"? It sounds more like a "private process" to me.

Intergulf is a Delaware Limited Partnership. Anybody, I mean anybody, in this city could be a shareholder in Intergulf. There is no way to penetrate the Delaware corporate veil.

Here are the two blocks, entirely physically unaffected by all the transfers of ownership and speculator profits. Not a single physical change occurred until the College owned it. The block on the right is now a parking lot, except for the Gay & Lesbian Transgender Center at the bottom right corner, which will remain.


 

 
 

Who is the Mayor's real real estate broker? 07/09/07

 
                                                         by Pat Flannery                                        top^

Earlier this year, a Janice Weinrick was appointed by Mayor Sanders to "oversee 11 City-managed redevelopment project areas throughout San Diego, encompassing more than 7,600 acres and representing more than $2 billion in investment underway and in the pipeline." Here is the news release announcing her appointment.

Her developer-related credentials are impressive. But here is an article in the San Diego Metropolitan magazine (a sort of gossip column for the "in" crowd of San Diego) that raises some questions. According to the writer, Manny Cruz, Weinrick "shares the home with her boyfriend, Lin Martin, a retail commercial broker with Grubb & Ellis|BRE Commercial."

I spoke with Mr. Martin today and asked him about his involvement in the
$750,000 purchase of the duplex at 1027 15th. St. for Mike Madigan and Paul Nieto. At first he couldn't remember the transaction. Understandable, considering he does so many.

Look at Lin Martin's available properties. The fact that he lives with the Assistant Director of City Planning and Community Investment and the Deputy Executive Director of the City’s Redevelopment Agency, Janice Weinrick, probably has nothing to do with it. The fact that she "oversees 11 City-managed redevelopment project areas throughout San Diego, encompassing more than 7,600 acres and representing more than $2 billion in investment underway and in the pipeline" just makes for interesting conversation in the evenings but in no way affects their respective day jobs.

I asked him about his association or affiliation with Grubb & Ellis. He explained that he is an independent real estate broker, not under the control of the
Grubb & Ellis|BRE Commercial broker of record, Marc Doyle. I checked with the corporate headquarters of Grubb & Ellis|BRE Commercial in La Jolla. They confirmed that Mr. Martin is indeed an independent broker and not an associate licensee. Apparently Grubb & Ellis|BRE Commercial does not require brokers like Mr. Martin to subordinate their broker's license to their employing broker, Grubb & Ellis|BRE Commercial, as other employing brokers do. I suggested they talk to the Department of Real Estate and clarify the matter.

It appears that the Grubb & Ellis name is some kind of loose "affiliation", not a full franchise. That idea may work well as a marketing concept but I am not sure how it works with California real estate law. My understanding is that the State is anxious that the public are always clear about who they are doing business with. For example: which Grubb & Ellis, or independent broker using the name Grubb & Ellis, is the City of San Diego's Real Estate Assets Department (READ) doing business with?
 
 
 

City College was offered the property for $750,000! 07/07/07

 
                                                         by Pat Flannery                                        top^

I re-read the July 1st U-T story about the Madigan/Nieto/City College real estate deal and was struck by the complete absence of any mention of Grubb & Ellis. How could the U-T have researched this story over a number of months and not know that Grubb & Ellis represented Mike Madigan and Paul Nieto in the purchase? Does Grubb & Ellis enjoy some special status down at the U-T now that it is Mayor Sanders broker for all City land?

In my last blog I wondered: "
Did Grubb & Ellis, who would certainly have known about the College's acquisition plans, approach the sellers out of the blue?" So I did a little research in the MLS. It turns out the property was listed with a broker. I spoke to that broker and he told me that Grubb & Ellis had written directly to the owners, apparently unaware that the property was listed in the MLS. The owners passed the Grubb & Ellis letter to their broker.

In the letter, Grubb & Ellis said that TMG Partners and the College District were interested in a joint purchase of the property. An escrow was opened on January 31, 2006. It was to be a 1033 exchange, the advantages of which can only accrue if a public agency is involved in the purchase. The College is a public agency, which may be why Grubb & Ellis wished to include it in the purchase. Mention of the College also had the effect of discouraging the seller from going directly to the College, at least for a while.

The sellers' listing agent recommended the offered price of $750,000, as the property had been on the market for 113 days with only one prior offer (which was not acceptable). The long escrow was finally assigned to Madigan and Nieto personally, prior to closing, whereby the advantages of the 1033 exchange were lost. Was it a bait and switch?

In my previous blog I say: "What about that $1,125,00 independent appraisal? Did the U-T actually see it? Does it exist?" If it ever existed as the U-T reported, it was not supported by the facts. No professional appraiser or real estate professional (except perhaps the one who appraised "Duke" Cunningham's Del Mar property) would write an appraisal for $1,125,000 on a property that had been on the market at $795,000 for 113 days, was now in escrow for $750,000 and had attracted very little other interest prior to that.

Therefore it would appear that the College District (and the taxpayers) paid $534,375 more than was needed to acquire the property.

But it gets even more interesting: here is the MLS listing (and two MLS photographs). Look at the timing. The escrow dragged on for almost a year - from January 31, 2005 to January 20, 2006. Apparently the buyers asked for, and were given, a number of extensions during that period. The listing agent said that he will attest to the fact that on one occasion, before agreeing to another extension, the sellers and their agent went directly to the College District
Vice Chancellor for Facilities Management, Damon Schamu and offered the property to the College District for $750,000.

Apparently Mr. Schamu declined on behalf of the College! If that is true, it raises huge legal and ethical problems for Schamu.

College Board member Peter Zschiesche told the U-T that "the district's policy is to pay fair market value, and that it was clear that Madigan and Nieto bought their property well under the market value" and that "he would like to prevent speculators from profiting off the college district's expansion plans, but doesn't see how". Did he know that the College District had been offered the property at $750,000 i.e. "fair market value"?

Zschiesche and the U-T articled finished with: “In the world of private enterprise, I sort of accept some things I can't change,” he said. “It's an interesting discussion, and if there are some better ways to do it, I would like to know.” Well now you do - it's called honest dealing. That's all that is needed.

Zschiesche and his colleagues on the College Board have a duty to the taxpayers who voted not one bond, Proposition S for $685 million, but also Proposition N for $870 million for such purchases. It is time the boards of public agencies started taking their oversight responsibility seriously. The least I would expect the Community College District board to do is call Mr. Schamu back from his sudden retirement and question him closely.

As for Grubb & Ellis, I think Mayor Sanders owes the San Diego public an explanation as to why he finds this particular real estate brokerage company to his liking.
 

 
 

About that Madigan-City College deal .... 07/07/07

 
                                                         by Pat Flannery                                        top^

Like most San Diegans I was intrigued by this story in the U-T on Sunday July 1, 2007.


It seems that two "consultants" to
City College, Mike Madigan and Paul Nieto, purchased a duplex, on a 3,750 square foot lot at 1027 15th Street, for $750,000 and flipped it to their client, City College, for $1,284,375? A nice profit of $534,375.

City College is part of the San Diego Community College District. The District has a Construction Bond Program. The person in charge of that bond program was
Vice Chancellor for Facilities Management, Damon Schamu.

I say "was" because, as I had some questions following his interview with the U-T last Friday (29th June 2007), I called the College and asked to speak to him. I was told that he had retired. Was that planned? I read the minutes of recent Citizens' Oversight Committee meetings and Schamu did not sound like a man nearing imminent retirement. The last meeting was on May 14, 2007. No presentations or best wishes. No goodbyes.

The next meeting is on Monday, July 9, 2007,
Mesa College, Bldg H100, Rooms H117-H118,  San Diego, CA 92111 at 4:00 P.M. Perhaps some members of the public should turn up and ask a few questions. If I can make it I will.

My question would be: how well is the College accounting for its spending of the $685 million we, the San Diego voters, generously approved on November 5, 2002? Remember that vote? The Madigan/Nieto "
profit" of $534,375 came out of our hard-earned tax dollars.

That "profit" has generated a lot of strange reports:

San Diego Metropolitan Magazine March 1, 2006:
"TMG Partners has purchased 3,750 square feet of space at 1027 15th St. in Downtown San Diego (92101) for $750,000. The sellers were the Sumida Family Trust and The Creek Revocable Family Trust. Tim Rudolph represented the sellers. Lin Martin of Grubb & Ellis|BRE Commercial represented the buyer." That is obviously based on this false press release from Grubb & Ellis.

Here is the Grant Deed. No mention of TMG Partners anywhere on the document. Why did Grubb & Ellis falsely name the buyer as TMG Partners? They said they brokered the transaction so they must have known that this was a gross misrepresentation. Why?

And who is TMG anyway? It seems that Paul Nieto became a partner in 2004. No mention of Mike Madigan. Yet Nieto and Madigan gave the San Francisco address of TMG,
100 Bush St., Suite 2600, San Francisco, CA 94104, for their grant deed. They sure went out of their way to hide their identity from the seller AND GRUBB & ELLIS HELPED THEM!!

Madigan and Nieto purchased the property from Esao Sumida and Glenda S. Sumida as to 50% and Milton H. Creek and Jean G. Creek as to the other 50% on January 11, 2006. The U-T article reports: "District officials said they knew Madigan and Nieto had bought the property and offered to buy it from the pair Jan. 18, 2006, for $1,125,000, the amount the land was appraised at in December 2005. The men declined the offer."

Why did "District officials" wait until Madigan and Nieto owned the property before making their offer of $1,125,000? Why did they not just offer that price to Sumida and Creek in 2005? These College staffers made the offer to Madigan and Nieto one week after the two men had purchased it for only $750,000! That is very strange, to say the least.

This
Facilities Master Plan, showing that the City College wanted the entire block, was not published on its web site until well after Madigan and Nieto owned the property.



Did Grubb & Ellis, who would certainly have known about the College's acquisition plans, approach the sellers out of the blue? Grubb & Ellis subsequently reported their buyer as a San Francisco Partnership named TMG. That's probably who they said they represented when they made their approach. Did the sellers suspect that City College might be the real buyer? Did they try to contact College staff themselves? It was widely known at the time that City College was acquiring property in the area. Was Grubb & Ellis representing both TMG Partners (Madigan & Nieto) and the City College? Or pretending to be?

What about that $1,125,00 independent appraisal? Did the U-T actually see it? Does it exist? If it does, t
he College Board needs to locate and publish it, to demonstrate that Proposition "S" money was not wasted and that a corrupt transaction did not take place. Either the buyer or the seller was cheated out of $534,375. That is a fact.

Madigan and Nieto
sold the property to the College for $1,284,375, not $1,125,000. Can staff pay more than the appraised value? There are so many questions.

Interestingly, Madigan and Nieto first quitclaimed it to a trust, using an in-law's name, James Shillady, as trustee, on July 21, 2006. Was that to give College staff cover? So they could pretend they did not know they were purchasing it from their own consultants?

Contradicting an earlier quote: "District officials said they knew Madigan and Nieto had bought the property", the U-T reported: "In a May 22 interview, Schamu refused to acknowledge dealing with Madigan and Nieto on the 15th Street property. When asked whether the college knew it was buying the property from Madigan and Nieto, he said, “I don't believe that's the name of record,” and added that Shillady “is the name we dealt with.”
It sounds like Mr. Schamu knows a lot more than he told the U-T.

Say what you will about the Chinese, they have the right idea: they execute officials who take bribes. Read this (two stories down). Maybe we should study their system. 
 

 
 

"Community Plans"  vs. "Stakeholder Plans". 07/04/07

 
                                                         by Pat Flannery                                        top^

According to this article in the Daily Transcript
on June 13, 2006, by Dave Nielsen, the Otay Mesa Planning Coalition (OMPC) consisted of representatives from Centex Homes, DR Horton, Integral Communities, McMillin Land Development, Murphy Development, Pardee Homes and Sunroad Enterprises. A few have since left.

Mr. Nielsen told us that
City staff had been working with these "stakeholders" to update the Otay Mesa Community Plan. Is that a "Community Plan" or a "Stakeholder Plan"? Look at the satellite picture below. Only a very small portion of the 9,300 acres that comprise Otay Mesa (that part of the city of San Diego east of Interstate 805 and south of Chula Vista) is residential. Most of the residences are new and west of Brown Field.



The pretty colors below represent the way "stakeholders" plan to divide up the 9,300 acres between them.



Unfortunately the colors on their pie-chart don't quite match, but their numbers are helpful. Remember, "commercial" and "village" are high density multi-use (can be residential).


Then today the U-T ran this story by Jennifer Vigil. She reported that Jim Waring wrote a letter to Dave Nielsen (consultant to OMPC) last Friday telling him that the developer's control of planning is ended. The City is taking over. I wonder what prompted that. Ms. Vigil reported that Mayor Sanders approved it. That probably means he initiated it, or more likely his PR team initiated it. Waring would never pull the plug on developer friends like Sunroad. Sanders' handlers seem to be building a protective fence around their boss - the links between his campaign contributions and planning became just a little too obvious.

The incestuous little group of "stakeholders" who call themselves the Otay Mesa Planning Group tells the story. There is Tom Story representing Sunroad and Dick Murphy's brother Mike, representing Murphy Construction. Then there is Pepper Coffee, wife of Dick Murphy's old pal Dan Coffee who has undertaken a vengeful race for City Attorney out of little more than an irrational hate for Mike Aguirre (that will endear him to developers).

The Chair of this so-called "Community" Planning Group is none other than Senior Vice President of commercial real estate brokers,
CB Richard Ellis, Rob Hixson.

But back to consultant Dave Nielsen - he is also the lobbyist for SEDC.
Lobbying the City of San Diego for SEDC (which the City owns!) is so onerous that Nielsen had to hire Donna Jones, a senior partner in the law firm of Sheppard, Mullin, Richter & Hampton LLP. This high priced Ms. Jones also represents Sunroad, McMillin, Horton, Centex AND Scott Peters (in his little problem with the SEC). Is this incestuous or what? No wonder Sanders put Jones on his Charter Review Commission - she is the ultimate insider.

Therefore we must learn to differentiate between "Community Plans" and "Stakeholder Plans". The same problem arose recently in Barrio Logan. Councilmember Ben Hueso and City Planning Director Bill Anderson want to have a committee of "stakeholders" draw up the Barrio Logan Community Plan. I attended a community forum at the
Cesar Chavez Educational Center last week and got some idea of the complicated dynamics there.

I came away all the more convinced that the word "Community" must not be hijacked by greedy opportunist (some local) who just want to pick up cheap land from longtime residents who still trust their city government. Community Planning Groups are being hijacked all over the city by developer interests. The so-called Community Plans are being written by developers. Just ask yourself: what is Tom Story of Sunroad doing on the Otay Mesa Planning Group? We all know the answer.

Mike Aguirre has proposed a "Community Bill of Rights". I fully support that idea, especially Aguirre's proposal that the City finance all 42 Community Plans. Planning Director, Bill Anderson, estimates $1.5 million per Community Plan. Nonsense!  All 42 Community Plans could be done for $1.5 million. I know, I ran some tests using SanGis electronic mapping and experimented with templates using existing community plans.

Anderson either wants to pad his Department's budget (as Casey Gwinn did by charging millions of dollars to the Sewer and Water Enterprise Funds for non-existent services) or he has been told to kill the Community Plans, which would then kill the Planning Groups.

We all know that our City Government is run for developers - but our Community Plans too? We must chase the Tom Story's off our Planning Groups. We must ensure that our Community Plans are "Community Plans" not "Stakeholder Plans". It is up to us.
 

 
 

Manchester sues the California Coastal Commission. 07/03/07

 
                                                         by Pat Flannery                                        top^

Manchester has sued the California Coastal Commission (CCC) asserting that it cannot require him to obtain a Coastal Development Permit (CDP) before developing Navy Broadway because it is on federal land and thus excluded by the Federal Coastal Zone Management Act (CZMA) from the California "coastal zone" and from the Coastal Commission's jurisdiction.

The Coastal Commission on the other hand asserts that it can indeed require Manchester to obtain a CDP because the project will be developed by Manchester, not by the Navy. CCC also asserts that substantial changes have occurred since 1991 that will require a supplemental federal consistency review of the project under CZMA.

Doesn't this remind you of Sunroad thumbing its nose at the FAA? It should. It is the same cocky attorney, Steve Strauss of Cooley Godward, that is now taking on the CCC.

The mistake Strauss is making in both cases is that while his clients can, and probably have, bought off City Hall, they can't buy off state and federal agencies. Item 52 on page 12 is very telling. It says: "Manchester contends that its rights to develop the project is vested consistent with the Development Agreement and Guidelines are vested and that the only remaining approvals required of the project are from CCDC and the City".

That sentence says it all. Strauss and his developer pals think they can just deal with CCDC and the City, that Sanders and Waring can fix anything for them. Well, San Diego is not an island, it is still part of California and part of the United States.

Here is the response of the Attorney General of the State of California, Jerry Brown, on behalf of the California Coastal Commission. The AG says that
"the [Coastal] Commission cannot be sued in federal district court under the circumstances presented here", that the U.S. District Court therefore "lacks jurisdiction". The AG points out that "the plaintiff seeks a declaration that it is not required to obtain a coastal development permit under the California Coastal Act of 1976, a state law."

I wonder what law school Strauss went to. Even I know that the United States District Court cannot rule on State law. Get another lawyer Mr. Manchester and save yourself and the people of San Diego a lot of aggravation. You will end up backing down just as Sunroad did. Besides, by then both Waring and Sanders will be long gone.

 
 
 

Did a Redevelopment Agency official make a quick $1/2 million secret profit? 07/03/07

 
                                                         by Pat Flannery                                        top^

Here are the facts:

On May 1, 2000 an Illinois Corporation named Federated Industries Inc. granted the two properties depicted below to Caravan Properties LLC, a California Limited Liability Company apparently owned, or partially owned, by Artie M. Owen (a.k.a. "Chip" Owen), current chairman of Southeastern Economic Development Corp. (SEDC). The purchase price was $1,800,000 (Documentary Transfer Tax $1,980 divided by 1.1 per $1,000).

On May 1, 2000 (the same day), as part of the same transaction, Caravan Properties first granted these properties to itself and Artie M. Owen by quitclaim deed (without paying any Documentary Transfer Tax which means no money changed hands) then simultaneously granted it to the San Diego Redevelopment Agency for $2,300,000 (Documentary Transfer Tax $2,530 divided by 1.1 per 1,000), an instant secret profit of $500,000. In the real estate profession such transactions are always considered a "secret profit".


Who pocketed the $500,000? That's not all. It gets better.

Jim Waring "sold" lots 15 & 16, i.e. 2.09 acres, to Har-Bro Construction on January 12, 2007 for $300,000. That's right. Not $3 million, $300,000!


Here is the Grant Deed signed by Jim Waring (on page 8 of 17), posing as an Assistant Executive Director of the Redevelopment Agency. Presumably all the real Assistant Executive Directors refused to sign it, just as the City's real building inspector refused to sign the infamous December 21, 2006 letter lifting the Sunroad stop work order that DSD Director Marcella Escobar-Eck then signed herself.

Why else would Jim Waring, the City's Chief of Land Use and Economic Development, sign that Grant Deed? Or maybe he just didn't want any staff person to know about it.

I visited these Market Street properties last evening. Construction is proceeding at a rapid pace on lots 15 and 16 and according to the leasing agent, it is already partially rented.

The other half of the original two properties RDA acquired on May 1, 2000, lot 37, i.e. 2.01 acres, was sold by the RDA to TayRad LLC for $2,100,000 on May 21, 2001. TayRad is a Limited Liability Partnership owned by Kenneth M. Taylor and Anthony D. Radovich.

TayRad then sold it to 5335 Market St. LLC, owned by Gustavo Spoliansky of 1307 Palisades Beach Rd., Santa Monica, on July 22, 2002 for an undisclosed amount. He signed a Trust Deed on March 15, 2005 securing $1,300,000 from a Loretta M. Scherer.

I was unable to determine why the grant deed did not show the Documentary Transfer tax as the the person who deals with "non-disclosures" at the County Recorder's Office does not answer their phone (how do I get a job in government?). Normally it is because there is no real change of ownership. Spoliansky recently re-sold the property. It is still in escrow.

So, a lot of money is changing hands in this "redevelopment" business. People are getting rich while the City is threatened with bankruptcy. The San Diego Redevelopment Agency is a real can of worms. It does not even publish accounts. According to the Mayor's office it is "consolidated" into the CAFR. I wonder why. It is in reality a black hole of corruption.

I intend to keep digging - deeper and deeper. I will let you know if anybody comes up with satisfactory explanations for the Market Street properties. I will be particularly interested to hear from Jim Waring and Artie M. Owen a.k.a. "Chip" Owen. Is there more? Probably.
 

 

© Copyright "San Diego Today"  November, 2004 - April, 2009