Thursday, September 22, 2005 | The public integrity unit in the City Attorney’s Office is investigating Councilman Jim Madaffer’s successful efforts in 2001 to secure a retroactive pension increase for a former councilman he was simultaneously lobbying for state funding.
City Attorney Mike Aguirre announced the investigation Wednesday, the day after an article in the Voice of San Diego detailed through internal e-mails and other documents how Madaffer worked with former Councilman Mike Gotch to craft an amendment that reached back and awarded an improved level of pension benefits to 18 council members who had already ended their city employment.
“There does appear to at least be a basis for concern, and we’re going to take a look at that and review that to see if there are any legal violations,” Aguirre said during a midday press conference.
Gotch, who served as a councilman from 1979 to 1987, saw the largest benefit increase of any ex-council member when the City Council put the finishing touches on Madaffer’s amendment in January 2002. His pension jumped 48.6 percent – an increase of nearly $5,000 a year – while no other ex-official experienced an increase of more than 18.6 percent.
The benefit change also allowed Gotch, at the time a top aide to then-Gov. Gray Davis, to retire at age 55 rather than 60. That detail will allow him to collect about $71,000 more than he would have under the old benefit package, according to an analysis based on figures provided by the city.
The benefit increases were originally implemented in 2000 for current and future council members. Gotch has said he thought at the time it was fair to extend the benefit to former officials.
The article revealed that at the same time Gotch worked with the councilman to make sure the pension amendment applied to his personal situation, Madaffer was lobbying Gotch for help in securing a $15 million conservation grant to acquire park land in his district.
Madaffer said he welcomed the investigation so that any questions surrounding his activities could be cleared up.
“There’s no merit to anything on this,” he said of criticisms that the lobbying relationship was inappropriate.
Madaffer said he helped out Gotch just like he helps out anyone who calls his office daily looking for assistance on anything from potholes to streetlights.
“People respect the fact that I make efforts to handle their issues, and I do – each one with tenacity, and I always will,” the councilman from District 7 said.
No one answered the phone at Gotch’s home Wednesday and the answering machine did not pick up.
The pension system carries a deficit of at least $1.37 billion, is a focus of a host of local and federal investigations, and threatens to dominate city budgets for decades to come absent a fix.
E-mails show the two worked simultaneously on both Gotch’s pension and Madaffer’s land acquisition, oftentimes switching between the two topics in the same correspondence. In the letters, Gotch indicated he was meeting with state wildlife officials in efforts to secure funds for Madaffer’s project.
At the same time, Madaffer updated Gotch on his push for the amendment, accepting Gotch’s advice on how to proceed. The councilman also sent him a copy of an amendment to make sure it accommodated Gotch specifically. It didn’t, the e-mails show, so Madaffer returned to staff to craft one that did.
During that time, Madaffer hoped to win funds to acquire as much as 2,000 acres in the East Elliott area to expand the Mission Trails Regional Park – which runs through Madaffer’s district and alongside his Tierrasanta home.
Gotch said in Wednesday’s article that the lobbying efforts fizzled out. Eventually, in early 2003, the city did receive $5 million in funds through the state conservation board. It had received $3 million in 2000.
In a June 13, 2001 e-mail, Madaffer also offers Gotch use of a city car for an upcoming trip to San Diego to tour the East Elliott plot. Such use by a non-city employee would be a violation of council policy, which only allows city employees access to vehicles. Gotch declined the offer in a subsequent e-mail and signaled his intent to rent a car.
Madaffer said he simply was trying to facilitate and expedite a meeting.
Aguirre said the investigation would focus on laws governing the behavior of public officials and a statute that prohibits what is known as a “gift of public funds.” The law requires that officials expend public funds for the public good.
He said he may forward the matter to the District Attorney’s Office if he deems it appropriate.
E-mails show that staff raised a number of legal concerns regarding Madaffer’s amendment when it was first proposed, though no opinions answering these concerns have been located. Two attorneys who worked on the issue don’t recall opining on it.
The city attorney also announced further details of the lawsuits he plans to file Friday to strip the pension benefits of former Mayor Dick Murphy and former Councilmen Michael Zucchet and Ralph Inzunza.
The lawsuit will specifically target the three former officials with the goal of stripping elected officials of a series of retirement benefits granted over the years that he claims are illegal. Aguirre has already filed suit challenging benefits granted to city workers dating back to 1996.
He said a court victory would shave about $700 million off the pension deficit.
Aguirre said that a number of state and local laws have been violated in the creation of benefits reaching back decades. He said expenses have been created without providing funding – thereby creating an “illegal debt” under state law. Aguirre also accused prior officials, including his predecessor Casey Gwinn, of potential violations of Government Code 1090, a statute that forbids officials from taking part in contracts in which they have a material financial interest.
Murphy resigned in July under the weight of a growing fiscal crisis, ongoing investigations and a legal challenge to his November election victory. Inzunza and Zucchet were forced to resign after a federal jury convicted them of scheming with a strip club owner to overturn a law forbidding club patrons from touching dancers.
Attorneys for Murphy and Zucchet didn’t return phone calls. Inzunza’s attorney said he hadn’t yet discussed the issue with his client.
Murphy is receiving an annual pension of nearly $50,000. Zucchet and Inzunza are receiving pensions of $13,000 and $21,000 a year, respectively.
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