Tuesday, July 19, 2005 | San Diego’s political world has seen sufficient upheaval in the last couple years to be considered, at this point, completely inside out.
On a day in which two city councilmen were convicted on federal corruption charges and a conservative taxpayers group advocated the unprecedented step of placing the city of San Diego’s troubled pension system in the hands of a court-appointed expert, the political system of the nation’s seventh-largest city may have finally and officially imploded.
And San Diego awaits perhaps the biggest boot to drop.
Chaos seemingly surfaces daily. Tranquility is a luxury of bygone years. Scandal, billion dollar deficits, corruption, nude dancers – and even sudden death – lace a widening plot that grows more television and less reality with every passing day.
Still, the specter of enforcement by the Securities and Exchange Commission, FBI and U.S. Attorney’s Office lurks in the backdrop as parallel investigations into City Hall finances and politics, unrelated to the councilmen’s trial, enter their 18th month.
“San Diego’s in a state of turmoil that no one ever expected and that no one should ever have to endure,” said Mitch Mitchell, vice president of the San Diego Regional Chamber of Commerce.
As Monday dawned, Councilman Michael Zucchet assumed the role of acting mayor of San Diego, moving up from the usually-ceremonial role of deputy mayor in wake of former Mayor Dick Murphy’s official resignation Friday.
In late April, Murphy succumbed to the pressures of the dual federal probes and looming lawsuits that challenged the validity of his November reelection. Only a judge’s decision to discount more than 5,000 votes tipped the election in favor of the Harvard-educated judge and away from write-in candidate, surf shop owner and Councilwoman Donna Frye.
The mayor’s security detail escorted the 35-year-old Zucchet, who was to preside over his first council hearing at 2 p.m. yesterday, to the federal courthouse just before 11:30 a.m. upon being notified of the jury’s return.
In a court room thick with tension, a clerk slowly read the verdicts on the 30-plus individual indictments as midday neared. The defendants were each found guilty on various charges of conspiracy, extortion and honest services wire fraud, drawing looks of anger, shock and extreme sadness from an assembled group of family members, supporters and council aides.
Inzunza issued the jury a tight, angry stare after the clerk read the first verdict against him: guilty. Zucchet shook his head in disbelief three counts into his verdict.
Council aide David Cowan was found not guilty on one count of lying to federal agents. His former boss, Councilman Charles Lewis, would likely have been sitting at the same table as the four defendants had he not had died suddenly last year of liver disease at the age of 37 while awaiting trial.
“I believe I have done nothing wrong,” said a defiant Inzunza on the steps outside of the federal courthouse downtown. Appeals will follow.
“I believe that what I did was all within the law,” he continued. “It was all within the political structure that we have here in San Diego, here in California and here in the United States of America.”
From the day U.S. Attorney Carol Lam brought indictments down on the councilmen in August 2003, San Diego politicos wondered aloud if the actions of Inzunza and Zucchet departed from business-as-usual at City Hall.
The councilmen were charged with accepting campaign contributions and being party to different foils – such as authoring fake e-mails and sending a strip club employee to a hearing to pose as a concerned citizen – in order to create a synthetic public want for change to laws governing adult entertainment venues.
Supporters of the convicted saw nothing criminal in the indictments or hours of wiretapped and recorded conversations. The conversations, many of which were recorded by a muscle-bound, undercover ex-con named Tony Montagna, were simply a little glimpse at some of the unsightly corners of the political house, they said.
The federal government, and a jury of their peers, ruled differently. Now the councilmen face time in federal prison when sentenced Nov. 9.
“This is not the way business is always done,” Lam said of the actions of the convicted. “It isn’t and it shouldn’t be.”
Lam brushed aside suggestions that the sweeping convictions would embolden her office in its pursuit of the ongoing criminal investigation related to the city’s pension system.
“That’s not the way we do business,” she said at a press conference.
The FBI’s sudden raid of City Hall in May 2003 as part of the so-called “Strippergate” trial set the tone for what has become a story of national and international appeal.
The subplots in this drama are many. Apart from the federal government’s investigation into the pension system, six current and former pension trustees have been charged in state court by the District Attorney’s Office for voting on a deal that boosted their personal pension benefits.
Likewise, City Attorney Mike Aguirre has charged eight current and former pension officials with misusing their official positions for personal gain. And in Aguirre’s short stead in office, he has gone to political or legal war with a majority of council members, past and present pension officials and the leadership of the city’s largest union, the Municipal Employees Association.
“It’s an interesting civics lesson, unless you’re living it,” said Lisa Briggs of the San Diego County Taxpayers Association.
Today, FBI agents can be seen strolling casually through the central plaza between the City Administration Building and the Civic Center Plaza, noticeable only in the background of the daily press conferences held by mayoral candidates or headline-grabbing figures who were months ago anonymous.
The denizens of San Diego’s political world understand the lasting impacts of both the ongoing inspections and Monday’s damning convictions.
“This will forever change how this city is governed and how those who interact with it are governed,” Mitchell said. “It is definitely an indictment of the structure and the system.”
Just a week ago, the 52-year-old assistant administrator of the pension system died suddenly of a heart attack while he was preparing for work. Some close to the system blamed his death on the stress surrounding the pension polemic.
Later in the week, three of the seven pension trustees brought in to salvage a pension system wrought with allegations of wrongdoing stepped down amid furor over their early decisions and what they called threats of criminal charges from Aguirre. It appears it will be near impossible to find replacements given the current atmosphere, which led Briggs’ association to join the call to place the pension system into the arms of a receiver.
In a receivership, a court-appointed expert assumes control of a mismanaged entity. The appeal for receivership by the influential business group is essentially a vote of no confidence in the administration and board of trustees of the troubled pension system.
The pension board’s continued decision to guard documents protected by the attorney-client privilege and sought by the city’s auditors and federal investigators threaten to keep the city frozen from the capital markets, where it has been since September. Without that access, the city remains without funds to do the things cities do – such as build fire stations, repair streets and replace sewer pipes.
Until a cohesive plan is adopted by the city’s decision makers, the pension deficit is predicted to continue its expansion and consume an ever-growing chunk of the city’s day-to-day operating budget.
But decisions coming from council chambers could be few and far between in the coming months, as state law mandates that Zucchet and Inzunza be immediately suspended from their duties and forfeit their offices upon their November sentencing.
When coupled with Murphy’s resignation, the convictions leave six active council members. It takes five affirmative votes to enact typical legislation and a super-majority of six in some special cases.
One council member, Donna Frye, is in the middle of a mayoral battle that could last beyond the July 26 primary if no candidate grabs more than 50 percent of the votes. The runoff election is slated for Nov. 8, the day before Zucchet and Inzunza’s sentencing.
“The city has never been in a more dire need for a full council and mayor than this particular time,” said lobbyist Lou Wolfsheimer. “It’s an unprecedented gap in the whole governmental process.”
Indeed, the guilty verdicts were read just hours before Zucchet was to preside over his first City Council meeting as acting mayor. In the council’s prior two-week recess, Aguirre had filed a set of lawsuits challenging the legality of pension benefit increases given to city employees in 1996 and 2002.
Council members huddled within minutes of the meeting’s 2 p.m. start time to decide how their first official congregation since the start of the fiscal year would proceed.
An unlikely cast was put in charge of resolving the council’s officer vacuum. The council initially sought the direction of their frequent target of frustration, Aguirre. He issued a legal opinion last week preparing the council members for the hypothetical situation they would be wading knee-deep in on Monday.
Eyes were on Aguirre as he summarized his findings to the onlooking council members, public and reporters – all oblivious as to how the city would carry on its business. Citing Robert’s Rules of Order – a parliamentary code employed by the council if a situation isn’t addressed in the City Charter and the municipal code – the city attorney offered an explanation that the council meeting should be started by the “secretary.” In this case, it was the city clerk.
But the position of city clerk has been vacant for weeks since the zany Chuck Abdelnour retired. So, the first person to call a meeting to order after Murphy stepped down was Joyce Lane, acting in Abdelnour’s place until his permanent successor is found. Lane said she learned about temporarily chairing the meeting 15 minutes before it started.
A quick roll call included awkward silences when the seats for districts 2 and 8 and the mayor were called. The first order of business thereafter: to select a temporary leader of the city.
Some council members said they didn’t pay attention to Aguirre’s direction, but they knew they wanted Toni Atkins, who wore the figurative deputy mayor sash the year before Zucchet, to act as the mayor pro tem for this week. She will serve in the role this week until a more-permanent temporary mayor is selected next Monday. That person will serve until a mayor is elected by the citizens of San Diego.
The council thought it appropriate to take on a minimal amount of work Monday, deferring most decisions that included public or council comment to a later date. Even the Jacobs Teen Leadership Institute, a band of young color-coordinated overachievers who arrived ready to receive a council proclamation, were told their day in the spotlight would have to wait.
“Today, anything on the docket that’s controversial, they’re going to put it off until tomorrow,” Briggs said Monday. “We don’t have that many tomorrows left.”