The Other Developer Donation

The Other Developer Donation

File photos by Sam Hodgson

Marti Emerald and Bob Filner

In a case with strong echoes of the controversial Sunroad deal that has ensnared Mayor Bob Filner’s office, another contested development held up by the city was allowed to move forward after the developers agreed to pay $150,000 for neighborhood improvements.

City Hall’s been buzzing over a $100,000 donation made by developer Sunroad Enterprises to the city of San Diego in exchange for formal approval of a development project in Kearny Mesa.

But earlier this year, developer Carmel Partners had already begun work on Centrepoint, a large project on El Cajon Boulevard, when Filner instructed city staff to stop conducting inspections on completed phases, thereby halting construction.

The developers sued, claiming Filner had halted their project in order to “curry favor” with local residents who had complained about the development. Before the lawsuit got to trial, Centrepoint settled with the city. A key part of that settlement: The developers agreed to pay $150,000 to enhance nearby Clay Park, once the building was complete. In exchange, the city agreed to allow the project to resume.

Centrepoint is different from the Sunroad controversy in some key ways. Notably, the request for a $150,000 contribution seems to have originated with the developers in response to a letter from a neighborhood group, rather than as a condition from the mayor’s office.

But there are notable similarities too. Both Sunroad and Centrepoint successfully disarmed Filner’s opposition by agreeing to give the city $100,000 or more above the impact fees they were already obligated to pay.

A Sudden Halt

The Centrepoint project, on El Cajon Boulevard and 63rd Street, will house 332 housing units, 10,000 square feet of commercial space and a parking garage with more than 1,000 spaces in four buildings near San Diego State University.

The city’s Development Services Department reviewed the project and found it was consistent with existing restrictions on the property. So, it awarded Centrepoint permits through a basic administrative process, which didn’t require more stringent approval from city officials.

Neighbors of the project complained, arguing Centrepoint is too dense and is actually intended as a pseudo-dormitory, rather than the luxury apartments it’s billed as. The project should have therefore required a different, more complex approval process, argued the Rolando Community Council.

The neighborhood group’s cause was taken up by City Councilwoman Marti Emerald’s office and, according to a lawsuit filed in May by the developers, the situation eventually attracted Filner’s attention.

Here’s the timeline of events, according to that lawsuit and other documents obtained by Voice of San Diego:

• On March 14, Emerald’s office sent Filner a memo demanding that construction of Centrepoint be stopped.

• On March 22, San Diego’s chief building officer sent the developers an email informing them an “administrative hold” had been placed on the project, and that resuming construction required securing an additional permit. To enforce this, the city stopped performing inspections of completed construction phases, which kept the builders from moving to the next phases of construction.

• Filner told Centerpoint he wouldn’t remove his hold on the project, and that the developers needed to work with the community to win support. The Rolando Community Council sent Filner and Emerald a letter reiterating its opposition, and informing them of needed improvements in the neighborhood that should be provided by any new project on the property.

• Centerpoint responded by sending Emerald a letter offering to pay $150,000 toward neighborhood projects. Emerald wrote back, thanking the group for its offer, but emphasizing the group still needed to change its plans.

• On May 7, Centerpoint filed a lawsuit in U.S. district court, claiming the city had illegally halted its project.

• On May 24, Emerald announced the legal settlement with the developers, after they agreed the project would rent units by the room, rather than by the bed, in addition to “several concessions for the surrounding communities.”

Turns out those concessions to the neighborhood included the $150,000 contribution Centrepoint offered to pay prior to filing its lawsuit.

The settlement establishes that Centrepoint will make the payment once the city issues a final “certificate of occupancy” for the finished project.

Another Sunroad?

There are some significant differences between the Centrepoint deal and the Sunroad controversy.

For one, the donated money will only be spent on improvements to a single park near the project site. The money will go toward Clay Park “in anticipation of the extra wear and tear imposed by the project,” according to the settlement. In Sunroad’s case, however, the projects funded by the developer donation aren’t connected to the area of the development.

That connection to the immediate area is potentially important legally, since the contribution essentially offsets the effects of the new project.

And, unlike with Sunroad, it doesn’t appear from the documents Voice of San Diego has obtained that Filner initiated or insisted on the contribution.

The offer to make the payment was sent by Centrepoint to Emerald’s office, which announced the eventual settlement.

Former Filner Deputy Chief of Staff Allen Jones confirmed Monday that Emerald’s office led those negotiations, though a May press release from the councilwoman announcing the settlement says the mayor’s office was also involved.

A spokeswoman for Emerald said in a brief statement Monday that the $150,000 was offered by Carmel Partners and was not initiated by Emerald.

“The mayor stopped the construction project six weeks ago at the urging of the neighborhoods and Councilmember Marti Emerald, who represents them,” the May release said. “The mayor, councilmember and developer have been negotiating since then to address community concerns.”

Filner’s office did not respond to a request for comment.

Despite the differences, there’s a key similarity to the Sunroad deal: The mayor used his power to direct city staff to halt construction of a controversial project. He then agreed to drop those objections once the negotiated settlement, including a contribution, was announced.

In the Sunroad case, the mayor vetoed a City Council decision to surrender some of the city’s property rights in a park neighboring the development. He then told Sunroad he’d instruct the Council to override his veto if Sunroad agreed to make the $100,000 donation.

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Andrew Keatts

Andrew Keatts

I'm Andrew Keatts, a reporter for Voice of San Diego. Please contact me if you'd like at andrew.keatts@voiceofsandiego.org or 619.325.0529.

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78 comments
Craig Long
Craig Long

My issue with this is it is yet another instance of King Filner ruling his personal empire without any regard for what is or isn't legal. Yet one more time since he was ordained as the Monarch of San Diego that he has ruled as he sees fit, not as the law allows. This guy's a loose cannon. I recommend we overthrow the dictator sooner than later.

Craig Long
Craig Long subscriber

My issue with this is it is yet another instance of King Filner ruling his personal empire without any regard for what is or isn't legal. Yet one more time since he was ordained as the Monarch of San Diego that he has ruled as he sees fit, not as the law allows. This guy's a loose cannon. I recommend we overthrow the dictator sooner than later.

Allen Hemphill
Allen Hemphill subscribermember

I know extortion when I see it.

Felix Tinkov
Felix Tinkov

The story misses the mark. The settlement in this instance is nothing like the payoff in the Sunroad project - the former being a negotiated agreement to avoid litigation and the latter an extortive effort to undo a legally prescribed right to veto a development. Notwithstanding the complaints of the neighboring residents, the Centrepoint project proceeded along a ministerial path requiring only building permits. The reason it was able to do so is because the developer did not seek to exceed the densities permitted under the property's zoning (not to mention compliance with the community and general plans). The community does not have input on each and every development when it arises. A project which is accounted for by the community and general plan is deemed to have been reviewed sufficiently so that impacts to the neighborhood are accounted for by the payment of fees (over $7M in this case, if I am not mistaken) and any other restrictions/requirements described in the plans. To do otherwise would mean that your neighbor could have the city halt efforts to renovate your personal abode once you received your permits. That the mayor opted to unilaterally demand a stop work order be placed on this project without so much as a hint of an imminent health, safety or public welfare problem or an error in the permits granted, is the unlawful action. Without such a trigger the city has no right to exact additional requirements on the project. If the developer had chosen to proceed through its lawsuit it would have undoubtedly won, had the city pay its attorneys' fees and damages for the delay. Vested rights in permits have been a hallmark of California jurisprudence for over a hundred years. But the developer opted to short-circuit the litigation, likely on the advice of its legal counsel (advice I do not agree with). This was probably a business decision, on the developer's part, because $150k is a pittance compared to the cost of delaying an ongoing construction project. But because the developer made the decision, as well as the offer, there is no way to draw a parallel to the Mayor/Deputy COS Jones demanding pay for play in the Sunroad case. Filner's stop work order was contrary to the law. Not the settlement check or how it was procured. Nevertheless, I fear this will not be the last time the Mayor strikes a populist, but illegal maneuver. I'm all for changing the status quo in this town, but it would be better if the government would do so while following the law. My read is that the Mayor's feud with Goldsmith is at the bottom of these things. Had the Mayor sought legal counsel he would have been advised that the stop work order was impermissible. Then again, maybe not knowing is exactly with Mayor Filner wanted. I mean, he did get something for the community out of it. But you can only pull the tiger's tail so many times....

Felix Tinkov
Felix Tinkov subscribermember

The story misses the mark. The settlement in this instance is nothing like the payoff in the Sunroad project - the former being a negotiated agreement to avoid litigation and the latter an extortive effort to undo a legally prescribed right to veto a development. Notwithstanding the complaints of the neighboring residents, the Centrepoint project proceeded along a ministerial path requiring only building permits. The reason it was able to do so is because the developer did not seek to exceed the densities permitted under the property's zoning (not to mention compliance with the community and general plans). The community does not have input on each and every development when it arises. A project which is accounted for by the community and general plan is deemed to have been reviewed sufficiently so that impacts to the neighborhood are accounted for by the payment of fees (over $7M in this case, if I am not mistaken) and any other restrictions/requirements described in the plans. To do otherwise would mean that your neighbor could have the city halt efforts to renovate your personal abode once you received your permits. That the mayor opted to unilaterally demand a stop work order be placed on this project without so much as a hint of an imminent health, safety or public welfare problem or an error in the permits granted, is the unlawful action. Without such a trigger the city has no right to exact additional requirements on the project. If the developer had chosen to proceed through its lawsuit it would have undoubtedly won, had the city pay its attorneys' fees and damages for the delay. Vested rights in permits have been a hallmark of California jurisprudence for over a hundred years. But the developer opted to short-circuit the litigation, likely on the advice of its legal counsel (advice I do not agree with). This was probably a business decision, on the developer's part, because $150k is a pittance compared to the cost of delaying an ongoing construction project. But because the developer made the decision, as well as the offer, there is no way to draw a parallel to the Mayor/Deputy COS Jones demanding pay for play in the Sunroad case. Filner's stop work order was contrary to the law. Not the settlement check or how it was procured. Nevertheless, I fear this will not be the last time the Mayor strikes a populist, but illegal maneuver. I'm all for changing the status quo in this town, but it would be better if the government would do so while following the law. My read is that the Mayor's feud with Goldsmith is at the bottom of these things. Had the Mayor sought legal counsel he would have been advised that the stop work order was impermissible. Then again, maybe not knowing is exactly with Mayor Filner wanted. I mean, he did get something for the community out of it. But you can only pull the tiger's tail so many times....

Don Wood
Don Wood

For years we've been told by the development industry that "smart growth" infill development will do two things: 1) decrease freeway dependent, taxpayer subsidized sprawl development and 2) revitalize those older neighborhoods who suffered decades of neglect while city leaders diverted resources to subsidize outlying sprawl housing subdivisions and shopping centers. Unfortunately, neither claim has proven true and VOSD should look into why. Today, while infill developers draw up plans for new high-rise condo towers and gigantic apartment buildings in our older neighborhoods, sprawl subdivisions are still going up at an accelerating rate on Otay Mesa and in North City. This is because the city gave big developers like McMillan and Baldwin zoning entitlements back in the mid-1980s that will allow them to keep building new sprawl developments for decades, and developers are also eying many remaining rural areas for even more sprawl. On the second point, infill developers want their upzones to build new projects that would change the nature of existing neighborhoods, but are unwilling to provide any funding to fix those neighborhoods and bring them up to existing city standards in areas like roads, sewerage, fire and police service and parks. They want city taxpayers to subsidize their projects by providing those amenities while they pocket the profits, or even sell their newly up-zoned properties to other developers at huge markups. The city of San Diego needs to do a lot more if it ever expects to convince residents of our existing older neighborhoods to accept more infill development, since those residents understand that pursuing both sprawl development and infill development is not smart growth, its stupid growth!

Don Wood
Don Wood subscriber

For years we've been told by the development industry that "smart growth" infill development will do two things: 1) decrease freeway dependent, taxpayer subsidized sprawl development and 2) revitalize those older neighborhoods who suffered decades of neglect while city leaders diverted resources to subsidize outlying sprawl housing subdivisions and shopping centers. Unfortunately, neither claim has proven true and VOSD should look into why. Today, while infill developers draw up plans for new high-rise condo towers and gigantic apartment buildings in our older neighborhoods, sprawl subdivisions are still going up at an accelerating rate on Otay Mesa and in North City. This is because the city gave big developers like McMillan and Baldwin zoning entitlements back in the mid-1980s that will allow them to keep building new sprawl developments for decades, and developers are also eying many remaining rural areas for even more sprawl. On the second point, infill developers want their upzones to build new projects that would change the nature of existing neighborhoods, but are unwilling to provide any funding to fix those neighborhoods and bring them up to existing city standards in areas like roads, sewerage, fire and police service and parks. They want city taxpayers to subsidize their projects by providing those amenities while they pocket the profits, or even sell their newly up-zoned properties to other developers at huge markups. The city of San Diego needs to do a lot more if it ever expects to convince residents of our existing older neighborhoods to accept more infill development, since those residents understand that pursuing both sprawl development and infill development is not smart growth, its stupid growth!

Richard Ross
Richard Ross subscribermember

Todd Gloria runs for office as a Democrat but actually runs towards the dough-re-mee as he looks for the the next political lily pad to leap to when he gets termed out of city council. Please we don't need anymore like him (or Scott Sherman) in Sacramento or Washington, D.C.

Richard Ross
Richard Ross

What is new? Developers in this city have been swapping dough and land in return for variations on their projects since this city was chartered.

Richard Ross
Richard Ross subscribermember

What is new? Developers in this city have been swapping dough and land in return for variations on their projects since this city was chartered.

mlaiuppa
mlaiuppa

Sunroad? Didn't they violate airspace ordinances and their building permit to build a building several stories too high too close to Montgomery Field, then have to tear down the top floors? *That* Sunroad?

mlaiuppa
mlaiuppa subscriber

Sunroad? Didn't they violate airspace ordinances and their building permit to build a building several stories too high too close to Montgomery Field, then have to tear down the top floors? *That* Sunroad?

Bill Bradshaw
Bill Bradshaw

So Filner's from Pittsburgh, right? Are you sure it's not Chicago? How about Emerald? It's one thing to negotiate concessions on the front end of these deals. As another writer points out, it's common practice elsewhere. But to stop them in progress for "mordida" is simply extortion.

Bill Bradshaw
Bill Bradshaw subscribermember

So Filner's from Pittsburgh, right? Are you sure it's not Chicago? How about Emerald? It's one thing to negotiate concessions on the front end of these deals. As another writer points out, it's common practice elsewhere. But to stop them in progress for "mordida" is simply extortion.

Fred Schnaubelt
Fred Schnaubelt

This type of political extortion has been going on for more than 30 years in San Diego where the city council works 24/7 to lower the standard of living. There is what Bastiat called the seen and unseen. Seen is lower density. Unseen is the city undertaking public housing that cost three times as much but hidden with the cost dispersed among all the taxpayers.

Fred Schnaubelt
Fred Schnaubelt subscriber

This type of political extortion has been going on for more than 30 years in San Diego where the city council works 24/7 to lower the standard of living. There is what Bastiat called the seen and unseen. Seen is lower density. Unseen is the city undertaking public housing that cost three times as much but hidden with the cost dispersed among all the taxpayers.

Matt Cromwell
Matt Cromwell

Excellent reporting! We depend on news like this to alert us to issues going on in our neighborhoods. It just feels a little too late at this point. What can be done to make sure this developer benefits the community rather than just create a giant luxury party dorm!?

Jan Hintzman
Jan Hintzman

There is an established process for resolution of issues between developers and neighborhoods. It involves City-established planning groups. What we see at CentrePoint is the result of that process having been circumvented by the old-boy politicians who “behind the scenes” cooperated with developers to close out the neighborhood…..entirely. I applaud our mayor and councilmember for bringing abuses such as these to light. And in the case of CentrePoint, I fail to see how our City Attorney is protecting the people’s interest when he quickly folds in the face of a developer lawsuit asserting might over right. $150,000 is a trivial compensation to the imposition of a 1,500 student-residence in a quiet residential neighborhood.

David Hall
David Hall

Not a fan of Marti Emerald, but I'll give her credit for this one. It's a shame that Jerry Sanders dismantled the planning department because with it, Centerpoint probably would be scaled back to something the community can actually absorb. What is going in now is horrendous and renting by the bed or bedroom would be akin to a SRO for 1000 people, right next to a grammar school and park.

David Hall
David Hall subscriber

Not a fan of Marti Emerald, but I'll give her credit for this one. It's a shame that Jerry Sanders dismantled the planning department because with it, Centerpoint probably would be scaled back to something the community can actually absorb. What is going in now is horrendous and renting by the bed or bedroom would be akin to a SRO for 1000 people, right next to a grammar school and park.

mwatson
mwatson

This is a complete non-issue, folks. It has been standard practice in well-run cities (like Boston, where I come from) for more than 30 years for the city to negotiate concessions from big-time developers who get rich exploiting public goods and amenities like parks, sewers, streets, water, and so on, without giving anything back to the community. San Diego lacks the kind of negotiated neighborhood-input process that has been in place in Boston for decades. The fact that the previous mayor was in the pocket of developers and failed to do anything for the neighborhoods impacted by development redounds to the shame of the previous administration. In the case of Centerpoint, the developers actually lied to the community, and there are no consequences for this? Really? I love VOSD, but you guys have this one all wrong. It's time for San Diego to join the 21st century and get some effective neighborhood-impact reviews and controls in place so no more developers can do what they just did to Rolando.

Kevin Swanson
Kevin Swanson

This appears to continue the "pay to play" mentality built into San Diego politics, and US politics in general. Were the ordinary citizen voices heard and acted upon? Were the Rolando Community Council's concerns addressed by the park improvements? Sounds like if you want anything from these politicians (including Gloria, et al) you have to have $$$$ and not just great ideas. Great ideas generate capital if supported. Not "America's Finest City's Finest Hour."

Kevin Swanson
Kevin Swanson subscriber

This appears to continue the "pay to play" mentality built into San Diego politics, and US politics in general. Were the ordinary citizen voices heard and acted upon? Were the Rolando Community Council's concerns addressed by the park improvements? Sounds like if you want anything from these politicians (including Gloria, et al) you have to have $$$$ and not just great ideas. Great ideas generate capital if supported. Not "America's Finest City's Finest Hour."

David Kissling
David Kissling

This isnt a real scandal where Filner and Emerald are demanding that the developer pay them (or their campaigns) personally the $150k to allow the development. But it is a scandal that San Diego is establishing a precedent under the Filner administration that the Mayor is the Decider in every battle between NIMBYs vs Developers, and that his decision has a price tag. San Diego can't live with a development model like this. We need clear rules that allow for development in the city (and yes, I do mean allow, sorry no-growthers), without each project subject to the whims of whoever may be occupying City Hall. If the City is going to require that developers fund park improvements (among other local infrastructure), then that's fine, but make it a clear amount and put it into law. The Mayor is not King, and the needed infill development in San Diego must happen without requiring the blessing of City Hall.

David Kissling
David Kissling subscriber

This isnt a real scandal where Filner and Emerald are demanding that the developer pay them (or their campaigns) personally the $150k to allow the development. But it is a scandal that San Diego is establishing a precedent under the Filner administration that the Mayor is the Decider in every battle between NIMBYs vs Developers, and that his decision has a price tag. San Diego can't live with a development model like this. We need clear rules that allow for development in the city (and yes, I do mean allow, sorry no-growthers), without each project subject to the whims of whoever may be occupying City Hall. If the City is going to require that developers fund park improvements (among other local infrastructure), then that's fine, but make it a clear amount and put it into law. The Mayor is not King, and the needed infill development in San Diego must happen without requiring the blessing of City Hall.

don lindsay
don lindsay

extortion and kickbacks...same ol' same ol' for established scamming leftists like both emerald and filner.

don lindsay
don lindsay subscriber

extortion and kickbacks...same ol' same ol' for established scamming leftists like both emerald and filner.

flite
flite

I don’t know. But what I do know is that within the long and sordid history of San Diego politics, and the seemingly forever-persistent power plays by our respective power brokers, Marti Emerald usually rises above the Byzantine intrigues of most of the power players... thankfully for the benefit of the average citizen and her community. That is what I do know.

Larry Mauzy
Larry Mauzy

You're excused. Your response to my question is one that I/we typically receive from our elected leaders (City Council). Just like them, answer a question with a question because you don't have the answer..

Larry Mauzy
Larry Mauzy

Not trying to justify anything. Typical response from someone that can't back up their accusation. Actually sounds like you won't and/or can't answerer the question or justify your comment? When this happens, a person responds with another question to the first question, GREAT!. This is the same type of response(s) that the tax paying public gets from its elected officials (City Council).

Larry Mauzy
Larry Mauzy

What do you call it when developers take advantage of communities?

Power To The People
Power To The People subscriber

You're excused. Your response to my question is one that I/we typically receive from our elected leaders (City Council). Just like them, answer a question with a question because you don't have the answer..

Power To The People
Power To The People subscriber

Not trying to justify anything. Typical response from someone that can't back up their accusation. Actually sounds like you won't and/or can't answerer the question or justify your comment? When this happens, a person responds with another question to the first question, GREAT!. This is the same type of response(s) that the tax paying public gets from its elected officials (City Council).

Power To The People
Power To The People subscriber

What do you call it when developers take advantage of communities?

Richard Ross
Richard Ross

Todd Gloria runs for office as a Democrat but actually runs towards the dough-re-mee as he looks for the the next political lily pad to leap to when he gets termed out of city council. Please we don't need anymore like him (or Scott Sherman) in Sacramento or Washington, D.C.

Hopeful Citizen
Hopeful Citizen

MWatson, the citizens in San Diego have to be given a chance to be listened to and unless you have experienced the underhanded and back door deals with prior approved decisions made before you have your day in the emperor's council, you will not personally understand how it is that are being mis-represented by City Council. Todd Gloria, Scott Peters, Lori Zapt, Scott Shurmann are all banking on future opportunities. The citizenry of San Diego has the opportunity to wake up. There are people on the council with integrity and those that are puppets of the Lincoln Club or are self serving and using the position for personal gain as they have unique access to insider insights. The former mayor put the fox in the hen house when he removed the planning commission (voice of the citizens) and created a development services department. There is a combined development alliance with planning that creates a a great opportunity for conflict of interest. No integrity. This is happening now in our communities, and prior to this, the Village at Zion was the latest example of back door manipulation with grand standing and theater performed and orchestrated by Todd Gloria and our city development department. We the people are not considered citizens any longer. The council prefers dealing with consumers. Citizens are an ennobled class and their voices count. Consumers - well their votes are counted by dollars spent.

Richard Ross
Richard Ross

Those that don't support "no-growth" don't mind the future of San Diego becoming the wild West with neighbors shooting one another over drinking water and food. The majority developers in this city are in the take the money and run mindset and let the devil take care of the public.

nifongnation
nifongnation subscriber

Beanie babies are taking over.

Richard Ross
Richard Ross subscribermember

Those that don't support "no-growth" don't mind the future of San Diego becoming the wild West with neighbors shooting one another over drinking water and food. The majority developers in this city are in the take the money and run mindset and let the devil take care of the public.

David Hall
David Hall

Do us all a favor and buy a dictionary. No extortion, no kickback. The major concession was the return to a rent-by-room model. Idealistic rightists who point fingers without accurate information are tiresome.

David Hall
David Hall subscriber

Do us all a favor and buy a dictionary. No extortion, no kickback. The major concession was the return to a rent-by-room model. Idealistic rightists who point fingers without accurate information are tiresome.

flite
flite

She is? Back that up with some facts, please.

Allen Hemphill
Allen Hemphill subscribermember

Excuse me, but are you justifying extortion?

flite
flite

She is? Back that up with some facts, please.