Tuesday, August 30, 2005 | The board of administration of the city of San Diego’s troubled pension system voted today to turn over long-guarded documents to local and federal investigators, as well as an audit committee investigating alleged wrongdoing by city and pension officials.
The surprise move breaks possibly the most lengthy and vital logjam holding up the delayed release of the city’s 2003 financial statements, its return to the capital markets and its cooperation with the ongoing investigations.
The board will hand over documents previously protected by the attorney-client privilege to District Attorney Bonnie Dumanis, the Securities and Exchange Commission, the U.S. Attorney’s Office and the outside audit committee assisting in easing the city’s financial crisis.
However, the vote stops short of actually waiving the attorney-client privilege, which will block the press and City Attorney Mike Aguirre from immediate access to the documents.
The pension system is estimated to have a deficit of at least $1.37 billion and is central to ongoing federal investigations into the city’s financial disclosure process and possible political corruption. The district attorney has charged six current and former pension board members with violating the state’s conflict-of-interest law for their 2002 votes in favor of a controversial pension deal made between the city and the pension board.
The pension board’s refusal to turn over the documents had threatened the city’s economic health. KPMG, the firm auditing the city’s 2003 financial statement, had refused to certify the city’s books if investigators weren’t granted access to the documents.
Without the audit, the city cannot regain its credit rating and return to capital finance markets to raise cash for infrastructure and other projects.
– ANDREW DONOHUE, Voice Political Writer