No, San Diego Wouldn’t Have Lost Soitec to the Higher Affordable Housing Fee

No, San Diego Wouldn’t Have Lost Soitec to the Higher Affordable Housing Fee

File photo by Sam Hodgson

Chamber of Commerce CEO Jerry Sanders is a member of The Jobs Coalition.

Jim Waring never minced words when he was former Mayor Jerry Sanders’ top land-use guy. And he didn’t hold back Nov. 4 when he got one minute to tell the City Council not to increase the fee on developers to support affordable housing.

He said the city has been proud of the Soitec manufacturing plant that moved into Rancho Bernardo. Soitec is a French company that builds parts for solar arrays. More about their endeavor is in this U-T San Diego piece.

“I can tell you, because I saw the numbers with absolute certainty, that if this fee had been in place, Soitech would not be in San Diego,” Waring said.

That’s not exactly true. A Soitec spokeswoman says the company would have come regardless.

SEE MORE: The Sad Facts About the Big Affordable Housing Fee Hike

Waring told me that he was part of a group that worked to help Soitec get to San Diego. There were two steps: 1) They needed to persuade Soitec to come to California over Arizona. 2) They wanted the company in the city of San Diego not Oceanside, where there was a building the firm was considering.

Sanders and others in the economic development community led the effort.

“There were very good reasons to go to Oceanside. It was a teeny bit better in Oceanside. They made the decision to go to Rancho Bernardo because of all the city had done to welcome them,” Waring said.

But it was close.

“If they had been assessed another $400,000 or $500,000 extra, all things being equal, they would have gone to Oceanside,” he said.

Oceanside, like all cities in San Diego County other than San Diego, does not charge an affordable housing fee on commercial and industrial developments.

When I checked with Soitec, however, I was surprised to hear a representative say Waring was just flat wrong.

“In the context of a $200 million investment, it wasn’t an issue then. Would it have been a determining factor? Probably not because of such a strong allegiance Soitec had to San Diego,” said Karen Hutchens, a local public relations professional who represents the company.

I clarified to be sure. She was saying Waring was wrong.

“Yes, he is,” she said.

Hutchens said Soitec was motivated to come to San Diego County because of its contract with San Diego Gas & Electric. And it chose the city of San Diego because of Sanders.

Rancho Bernardo, she said, also offered the company easy access to a “talented workforce.”

Voice of San Diego is a nonprofit that depends on you, our readers. Please donate to keep the service strong. Click here to find out more about our supporters and how we operate independently.


Scott Lewis

Scott Lewis

I'm Scott Lewis, the CEO of Voice of San Diego. Please contact me if you'd like at scott.lewis@voiceofsandiego.org or 619.325.0527 and follow me on Twitter (it's a blast!): @vosdscott.

  • 457 Posts
  • 0
    Followers

Show comments
Before you comment, read these simple guidelines on what is not allowed.

22 comments
Lucas OConnor
Lucas OConnor

One day before this article, you also wrote about affordable housing policy and quoted Jim Waring's take on the linkage fee's impact on business to support your argument.

Lucas OConnor
Lucas OConnor subscriber

One day before this article, you also wrote about affordable housing policy and quoted Jim Waring's take on the linkage fee's impact on business to support your argument.

Jim Jones
Jim Jones

Hutchins PR is not Soitec. I'm not even certain they were in the room when the negotiations went down.

That being said, with the at least $25 million in taxpayer money (possibly more) Soitec got they could afford to pay a few fees, but in reality with Tenaska and SDGE under mandate, passing all this to your electric bill. you are paying for all of this and if there were additional fees at the time you'd be passed the cost of those as well in your SDGE bill. Note that this is a very very different situation than a company under competitive forces coming here. Sure companies can be Moonbeamed into our city when it all comes out of your pocket and their profit is guarenteed with your tax money. The solar mandate goes away, your tax money stops flowing to this French company, and Soitec will be gone as well.

Jim Jones
Jim Jones subscriber

Hutchins PR is not Soitec. I'm not even certain they were in the room when the negotiations went down.

That being said, with the at least $25 million in taxpayer money (possibly more) Soitec got they could afford to pay a few fees, but in reality with Tenaska and SDGE under mandate, passing all this to your electric bill. you are paying for all of this and if there were additional fees at the time you'd be passed the cost of those as well in your SDGE bill. Note that this is a very very different situation than a company under competitive forces coming here. Sure companies can be Moonbeamed into our city when it all comes out of your pocket and their profit is guarenteed with your tax money. The solar mandate goes away, your tax money stops flowing to this French company, and Soitec will be gone as well.

Catherine Rodman
Catherine Rodman

So the sky isn't falling...thanks for following up on this. It illustrates how easy it is to say things, pro or con, and of how little value or relevance they may to the issue at hand. Hard for the public, staff or council to respond at the time. Some public hearings require comments to be submitted in writing and enable investigation and considered response by staff (and the other side) to help separate rantings from genuine concerns.

Catherine Rodman
Catherine Rodman subscriber

So the sky isn't falling...thanks for following up on this. It illustrates how easy it is to say things, pro or con, and of how little value or relevance they may to the issue at hand. Hard for the public, staff or council to respond at the time. Some public hearings require comments to be submitted in writing and enable investigation and considered response by staff (and the other side) to help separate rantings from genuine concerns.

David Hall
David Hall

Jim Waring was one of the least trustworthy individuals in a Sanders administration full of untrustworthy political hacks. No surprise here.

David Hall
David Hall subscriber

Jim Waring was one of the least trustworthy individuals in a Sanders administration full of untrustworthy political hacks. No surprise here.

Jim Jones
Jim Jones

Waring's quote is only valid if the numbers he says he saw are actually produced, then we can see what impact the linkage fees would have had based on what Soitec put in as their walk away point.

Without that, it's meaningless.

And Soitec is meaningless in this discussion anyway, they are heavily on the government dole to begin with, we are paying them more than we will ever recover from them, it's hardly indicative of a business that actually brings a level of productivity and growth to our region.

Jim Jones
Jim Jones subscriber

Waring's quote is only valid if the numbers he says he saw are actually produced, then we can see what impact the linkage fees would have had based on what Soitec put in as their walk away point.

Without that, it's meaningless.

And Soitec is meaningless in this discussion anyway, they are heavily on the government dole to begin with, we are paying them more than we will ever recover from them, it's hardly indicative of a business that actually brings a level of productivity and growth to our region.

Scott Lewis
Scott Lewis

Not sure what meeting you're referring to. But yes, I asked both about it. Hutchens said linkage fees were discussed. Waring admitted he only knew that it was close comparison. Actually, I'm not even sure that Soitec would have had to pay the fee. It did not build a new building. Checking now.

Scott Lewis
Scott Lewis

PR people aren't always straight with reporters?? You're shattering my world view Jim! Will remind you it was Jim Waring who said, with certainty, that the linkage fees would have mattered. I started this because I wanted to verify that and use it in my previous piece. Didn't work out that way.

Scott Lewis
Scott Lewis

For what it's worth, Soitec refers all press to Hutchens and she was standing next to the Clark Crawford, the VP, when she was talking to me. She consulted him. If she doesn't speak for the company, then they have a funny way of showing it.

Scott Lewis
Scott Lewis administrator

Not sure what meeting you're referring to. But yes, I asked both about it. Hutchens said linkage fees were discussed. Waring admitted he only knew that it was close comparison. Actually, I'm not even sure that Soitec would have had to pay the fee. It did not build a new building. Checking now.

Scott Lewis
Scott Lewis administrator

PR people aren't always straight with reporters?? You're shattering my world view Jim! Will remind you it was Jim Waring who said, with certainty, that the linkage fees would have mattered. I started this because I wanted to verify that and use it in my previous piece. Didn't work out that way.

Scott Lewis
Scott Lewis administrator

For what it's worth, Soitec refers all press to Hutchens and she was standing next to the Clark Crawford, the VP, when she was talking to me. She consulted him. If she doesn't speak for the company, then they have a funny way of showing it.

Jim Jones
Jim Jones

Um, linkage fees being discussed means nothing, were INCREASED linkage fees discussed? I have no doubt that existing linkage fees were discussed.

There were a series of discussions between Soitec and the city, Scott. This thing was so big that at the plant dedication not only did Moonbeam fly in, but even Fletcher was able to pull himself away from his busy schedule to attend, with tens of other suits.

Obviously there was a point where Soitec would have moved to Homicide, I mean Oceanside. What was that tipping point? $1? $10,000? $1,000,000? Was it discussed in a meeting at all? If you can't get that number then the whole thing is meaningless.

Was Hutchens even there when the differential between Oceanside and RB was discussed? Who else was there that can verify things? Was Crawford even there? He's a sales VP, right? If there did he have a voice in San Diego vs. Oceanside? Being in LaJolla I believe he likely assumed the plant would be closer to home no matter what, and Auberton-Hervé would have had no reason to make him think otherwise. Did Auberton-Hervé himself negotiate with Sanders directly?

I just don't see how you can determine, based on a PR flak that has a brief consoltation with a sales VP, that Soitec would or wouldn't have gone to RB or even out of state if linkage fees did impact them by some amount.

Also you simply can't use Soitec as a case for linkage fees impact on buisness coming here, the goverment (funded by us) is paying this overseas company hundreds of millions of dollars to come here. No one has argued that linkage fees will stop companies that are getting filthy rich off goverment money and SDGE and CPUC contracts. Linkage fees or not we can always bring someone here at our cost.

Oh, and has Soitec employed the 450 directly employed people it said it would?

Jim Jones
Jim Jones

Scott, if you want to verify what Waring said, you have to find out what was said in the meeting, or verify it on paperwork.

Was increased linkage fees discussed in the meeting? Probably not but I see no mention of you even asking.

What was the differential in cost to Soitec between Oceanside and RB that was discussed? If you can show that in the discussion Soitec indicated there was a trigger point for Oceanside, and the linkage fees would have exceeded that trigger point, then Waring could be believed. Did you ask this of any of the parties?

Was there anything in the PPA's they signed to mitigate additional fees?

Also as an aside, Soitec said the factory would employee 450 directly, near as I can tell they have 200. Is that true?

And to the main point, Soitec isn't indicative of linkage fees impact on business regardless of what the situation is, they are basically a government contractor with a baked in and generous profit agreement for installing those pies in the sky paid for by the citizen zombie. I don't think anyone on either side has claimed linkage fees will hurt the ability of the state to pay a company hundreds of million of dollars to set up shop here.

Jim Jones
Jim Jones

For what it's worth Scott, regardless of if Soitec would have chosen Oceanside over Rancho Bernardo over a few million, the proper PR at this time is to say they wouldn't have. It's called PR and not truth department for a reason. PR's job is to lie and mislead to put a company in the best light possible, often using reporters as their useful tools. If Soitec had to pay linkage fees, likely they would have been added in to the California money we are sending to France in those half dozen or so CPUC contracts they were awarded in this specific case, or they might have rethought Oceanside, we will never really know because it wan't an issue. Even Clark Crawford doesn't know what would have resulted if the city said "you need to pay $X million additional for your RB location" . Right now, from a PR perspective nothing they say can really be indicative of past what-ifs, it can only reflect what the company wants thought today.

Aside from that Soitec has signed SDGE contracts, billed eventually to SDGE customers like us worth hundreds of millions and a $25 million dollar grant on top of that, Soitec has a CPUC guaranteed profit regardless of fees or taxes, mandated from Sacramento and paid by us. To try to use that to imply there is no impact from Linkage Fees is frankly dishonest. Soitec is not here on a competitive basis, their share of our money is as hard baked in as SDGE, so they don't have to worry about linkage fees.


Jim Jones
Jim Jones subscriber

Um, linkage fees being discussed means nothing, were INCREASED linkage fees discussed? I have no doubt that existing linkage fees were discussed.

There were a series of discussions between Soitec and the city, Scott. This thing was so big that at the plant dedication not only did Moonbeam fly in, but even Fletcher was able to pull himself away from his busy schedule to attend, with tens of other suits.

Obviously there was a point where Soitec would have moved to Homicide, I mean Oceanside. What was that tipping point? $1? $10,000? $1,000,000? Was it discussed in a meeting at all? If you can't get that number then the whole thing is meaningless.

Was Hutchens even there when the differential between Oceanside and RB was discussed? Who else was there that can verify things? Was Crawford even there? He's a sales VP, right? If there did he have a voice in San Diego vs. Oceanside? Being in LaJolla I believe he likely assumed the plant would be closer to home no matter what, and Auberton-Hervé would have had no reason to make him think otherwise. Did Auberton-Hervé himself negotiate with Sanders directly?

I just don't see how you can determine, based on a PR flak that has a brief consoltation with a sales VP, that Soitec would or wouldn't have gone to RB or even out of state if linkage fees did impact them by some amount.

Also you simply can't use Soitec as a case for linkage fees impact on buisness coming here, the goverment (funded by us) is paying this overseas company hundreds of millions of dollars to come here. No one has argued that linkage fees will stop companies that are getting filthy rich off goverment money and SDGE and CPUC contracts. Linkage fees or not we can always bring someone here at our cost.

Oh, and has Soitec employed the 450 directly employed people it said it would?

Jim Jones
Jim Jones subscriber

Scott, if you want to verify what Waring said, you have to find out what was said in the meeting, or verify it on paperwork.

Was increased linkage fees discussed in the meeting? Probably not but I see no mention of you even asking.

What was the differential in cost to Soitec between Oceanside and RB that was discussed? If you can show that in the discussion Soitec indicated there was a trigger point for Oceanside, and the linkage fees would have exceeded that trigger point, then Waring could be believed. Did you ask this of any of the parties?

Was there anything in the PPA's they signed to mitigate additional fees?

Also as an aside, Soitec said the factory would employee 450 directly, near as I can tell they have 200. Is that true?

And to the main point, Soitec isn't indicative of linkage fees impact on business regardless of what the situation is, they are basically a government contractor with a baked in and generous profit agreement for installing those pies in the sky paid for by the citizen zombie. I don't think anyone on either side has claimed linkage fees will hurt the ability of the state to pay a company hundreds of million of dollars to set up shop here.

Jim Jones
Jim Jones subscriber

For what it's worth Scott, regardless of if Soitec would have chosen Oceanside over Rancho Bernardo over a few million, the proper PR at this time is to say they wouldn't have. It's called PR and not truth department for a reason. PR's job is to lie and mislead to put a company in the best light possible, often using reporters as their useful tools. If Soitec had to pay linkage fees, likely they would have been added in to the California money we are sending to France in those half dozen or so CPUC contracts they were awarded in this specific case, or they might have rethought Oceanside, we will never really know because it wan't an issue. Even Clark Crawford doesn't know what would have resulted if the city said "you need to pay $X million additional for your RB location" . Right now, from a PR perspective nothing they say can really be indicative of past what-ifs, it can only reflect what the company wants thought today.

Aside from that Soitec has signed SDGE contracts, billed eventually to SDGE customers like us worth hundreds of millions and a $25 million dollar grant on top of that, Soitec has a CPUC guaranteed profit regardless of fees or taxes, mandated from Sacramento and paid by us. To try to use that to imply there is no impact from Linkage Fees is frankly dishonest. Soitec is not here on a competitive basis, their share of our money is as hard baked in as SDGE, so they don't have to worry about linkage fees.