Murphy Stands by Decisions, Remembers How They Were Made

Friday, July 15, 2005 | San Diego Mayor Dick Murphy did not use his last week in office to express regrets.

The former judge did not make any eyebrow-raising announcements that he’s rethought his stance on some of the more controversial of issues.

But there was one question that made him think for just a second: “Does he regret not challenging the legitimacy of Donna Frye’s write-in campaign for mayor last year?” After all, courts brought in after the election later ruled that Murphy and his challenger Ron Roberts might have had a case against Frye had they brought it up before the election. They might have been able to keep her out of the race totally.

City laws have now been changed to ensure that no one can be mayor without having gone through a primary election, which Frye skipped last year in favor of the spontaneous and astounding write-in candidacy that may have forever changed the course of San Diego’s history.

Without her in the race, somebody would have won a majority of the vote. That kind of mandate might have kept Murphy’s boat afloat through this most tense of times. The very fact that he had been elected would never have been questioned like it was for months.

“I don’t think any of us thought she would do as well as she did, but to file a lawsuit and attempt to keep her off the ballot did seem to be kind of anti-democratic,” Murphy said in an interview Tuesday.

So, no, he wouldn’t have tried to stop her. But did her candidacy end up shooting a silver bullet into his career?

“It was a factor in what ultimately happened. We ended up with only 34.5 percent of the vote. It showed public dissatisfaction with the job I had done as mayor. We spent the first three or four months completely distracted by all the furor of the election,” Murphy said.

His top political consultant and chief of staff John Kern had no interest in contributing to this discussion.

“I will say we would have beat (County Supervisor Ron Roberts) without her in the race. But this is ‘What-if?’ history and there is nothing more useless than ‘What-if?’ history,” Kern said.

There are plenty of “what-ifs.” Take another interesting point in Murphy’s mayoral run, the 2002 decision to approve the now notorious Manager’s Proposal 2. The agreement enhanced pension benefits for city employees at the same time it allowed the city to continue paying less into the pension fund than required. Six members of the pension board at that time are now facing felony charges for their contribution to the arrangement.

The benefits, he said then, were not a mistake. And he still holds to that position. What would he do if he could go back to 2002?

“With 20-20 hindsight, the city should have issued pension obligation bonds to reduce the deficit rather than what was the manager’s recommendation to phase out underfunding over five years,” Murphy said.

Issuing pension obligation bonds would have essentially been like asking for a loan and taking the revenue from it to invest in the pension fund to boost its assets in relation to its liabilities to current and future retirees.

“We wouldn’t be in the same situation we are now if we had followed that course of action,” Murphy said.

What’s the situation now? The city could not issue pension obligation bonds even if it had the political will to approve them. Without a credit rating, bond buyers won’t even consider sending the city money. Without a verified audit of what the city spent, owed and collected in 2003 and 2004, there will be no credit rating.

Inaccurate, maybe even deceptive, disclosures about the state of the retirement system have delayed those audits. The city failed to properly outline for investors what its decisions regarding the retirement system actually did to the city’s financial position.

Murphy did say that he still thinks at least part of Manager’s Proposal 2 was a mistake. What happened then? Donna Frye, now a mayoral candidate again, has said repeatedly, and in defense of her own confusion at the time, that the vote was hidden on the council’s consent agenda. Had it been part of the discussion agenda, maybe so much of San Diego’s trouble could have been avoided.

Murphy said his staff put Manager’s Proposal 2 on the consent agenda.

“It was a good faith decision by my staff. There certainly was no intent to do anything devious,” Murphy said.

And he went on.

“Here’s an important point that I don’t think is understood: When things are brought up in closed session, we’re not supposed to discuss it with our staff. So when making decisions, on for example labor negotiations, it’s just me and the council and the city attorney talking about them. I didn’t get the benefit of my staff’s independent analysis on the labor negotiations that year. If my staff had had a chance to look at that, we might have done it differently,” Murphy said.

April Boling, the treasurer for Murphy’s reelection campaign last year, was appointed by him to serve on his Blue Ribbon Committee on City Finances and the Pension Reform Committee.

She said Murphy’s staff should be the first place to look for the origins of his eventual resignation.

“What I believe was a flaw in the Murphy administration was a lack of forceful policy people in the office. A properly constructed mayor’s office has subject matter experts who really do have the ear of the mayor. I never saw that with respect to the pension or,

In the interview, Murphy said there was too much divisiveness in the city now and he hoped his resignation would help put that in the past.

But it isn’t only a divide between Murphy and others like City Attorney Mike Aguirre.

It’s a divide in the perception of what’s actually happening to the city – one that separates even Murphy and his old deputy Kern.

Look at the way they answered different questions about the city’s current financial state:

“These people who say we’re not the finest city are either dishonest or stupid. We have a city government that has a financial problem. It has a significant problem that needs to be overcome. But in the perspective of what a great city we have, it’s a minor issue,” Murphy said.

But to Kern, it’s not even an issue.

“I have said repeatedly that the city’s finances are in good shape; there’s a lot of misconceptions, paranoia and bad information floating around,” Kern said. “Even if no money was infused into the pension system at all, it could still meet its obligations for 15-20 years.”

Scott Lewis is a former reporter at The Daily Transcript. You can e-mail him at

Read Voice‘s April 26, 2005 story, “Murphy’s Tenure Marked by Missed Warning Signs.”