The Morning Report
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Monday, January 09, 2006 | Mayor Jerry Sanders has indicated that cleaning house within San Diego’s embattled city government will take years, but voters in two City Council districts have the opportunity to decide immediately how they will be represented in this new era when they head to the polls Tuesday.
At stake in these runoff elections is not only the daily business of Districts 2 and 8, parts of town that have not had representation on council since the summer. The whole city is looking to see what legislative team is in office as upcoming decisions will surely shape the future of San Diego and its fiscal recovery.
The district-wide nature of council elections traditionally force candidates to argue about who can get nearby potholes fixed faster or who could get another fire station built in the district, but San Diego’s looming crisis has forced candidates to answer questions to stake out positions on complicated financial questions.
“The most important issue facing our beach communities is the same issue facing us throughout the city of San Diego: It’s our financial mess,” District 2 candidate Kevin Faulconer said at a debate in Pacific Beach on Thursday.
The city’s deepening pension deficit is at least $1.37 billion, and the city’s future annual contributions to it are expected to chew up larger and larger chucks of an already strained general fund. Everyday expenses such as police officers, park maintenance and library hours come out of the city’s general fund.
Additionally, the city is grappling with ongoing investigations into its financial-disclosure practices, pension dealings and wastewater rate structure. San Diego has been unable to make much-needed improvements to its streets, storm drains and water-treatment system because credit-rating agencies and, in turn, the bond markets have cut the city off until an outside auditor certifies its books. Going on four years, the city has been without audited financial statements.
Public officeholders and political groups have made endorsements in hopes of guiding voters’ decisions toward the course of action they find most appealing, and the candidates have knocked on doors and debated each other at recent forums to stir residents to the polls in a contest that is likely to inspire a very low turnout.
The fields of candidates vying for the vacant council posts in Districts 2 and 8 have dwindled to two in each race, following a Nov. 8 primary that included a record number of contenders in both contests. Because no candidate won more than 50 percent of the vote, the top two candidates advanced to the January runoff.
Voters in District 2, a coastal swath that stretches from southern La Jolla to downtown and includes Point Loma and Mission Hills, will decide between Faulconer, a public-relations executive and environmental attorney Lorena Gonzalez.
District 8 voters will choose between school board president Luis Acle and organizational consultant Ben Hueso to represent southern San Diego. The district extends from Barrio Logan and Golden Hill south to the city’s border neighborhoods of San Ysidro and Otay Mesa.
Mayor’s Plan Reviewed
By and large, the debate in District 8 has largely focused on aid within the district – a part of town where some of San Diego’s most impoverished reside. In contrast, Faulconer and Gonzalez have provided nearly equal emphasis to citywide concerns and those of District 2.
Sanders has endorsed Faulconer in District 2, saying that he based it off the candidates’ answers to a questionnaire the mayor’s political consultant distributed to the council candidates. The form includes questions about opening certain city services up for “competitive bidding,” ruling out tax increases to fix “the pension crisis,” and freezing city salaries for new hires. Out of the four candidates, only Faulconer returned the questionnaire.
Gonzalez said that she did not necessarily disagree with the mayor’s proposals, but wanted more specific information before pledging any support. She claims that the city’s mistakes are based in past councils’ lack of attention. She has vowed to not “rubber-stamp” proposals before the council.
“”The last thing we need is a council saying ‘yes’ to whatever the mayor puts in front of them. That’s what got us into this mess,” Gonzalez said in a recent interview.
Faulconer on Friday stiffly ruled out approving a Chapter 9 municipal bankruptcy in contrast to Sanders, who says it’s an option, albeit a last resort. The mayor said bankruptcy would be necessary if he can’t make the cuts or get the labor concessions he needs to keep the city afloat financially.
Gonzalez has begun flouting the endorsement of City Attorney Mike Aguirre, saying that it shows her commitment to reform. Since taking office, Aguirre has asked several officials and employees who he believes are culpable for the city’s current mess to step down and released several reports investigating the city’s pension and disclosure affairs.
In District 8, both Acle and Hueso have been more guarded in their debate about citywide finances. Each has talked about their experience as the best indicator of how they can mend the city’s fiscal wounds. Hueso refers often to his experience in the community, ranging from his leadership with the Boy Scouts to his role as a manager of a redevelopment effort in Barrio Logan. Acle argues he has helped turn around San Diego City Schools during the first year of his presidency.
Will They Fit In?
Every candidate says they support immediately bringing City Council pensions in line with those awarded to the city’s rank-and-file workers by eliminating the higher benefit rate and eased requirements that elected officials currently enjoy.
“I believe that if there’s a need for sacrifice, the sacrifice should start at the top,” Acle said at the Catfish Club debate Friday. “I think it should hurt us all evenly.”
Aguirre has pushed for the rolling back the plan for elected officials and Sanders believes the rollbacks would be a positive signal to send to the city’s labor unions that the mayor needs to renegotiate with for his recovery plan to work.
Meanwhile, Council President Scott Peters says that such a move would cost more in legal fees to defend than the sums it would save the city. The cost of the elected-official benefits Aguirre is attacking is likely less than 1 percent of the roughly $700 million in benefits he says are illegal.
The candidates also expressed skepticism over the city’s contract with the audit committee, a group of consultants led by former Securities and Exchange Commission chief Arthur Levitt who are investigating the city’s books. The audit committee was hired nearly one year ago to present their findings to outside auditors and the SEC, but the council candidates say there is no end in sight to the millions that are being spent on the audit committee.
“I think the audit is very important in getting our city back on track, however it reflects a general culture that we’ve seen in our government in the past,” Hueso said, noting that there was no competitive bidding, set completion date or agreed-upon dollar amount for the work. “I do think the voters are being taking for a ride on this issue.”
The other candidates had similar stances on the issue that contrast with the attitude of the current council majority. Aguirre has criticized the audit committee in the past, but council members have rebuffed his arguments, even going as far as apologizing on the city’s behalf for the city attorney’s behavior and cutting off his microphone at a public meeting.
The two districts that have been without council representation for nearly six months will choose their leaders Tuesday, and the outcome could determine if Sanders’ reform package gets enacted. The addition of two candidates friendly to Sanders’ and Aguirre’s reforms could tip the scales on the eight-member council and chart the body on a different course than years’ past.
In Sanders’ first month in office, the two officials have come out as a reform team and could be a formidable tandem if their relationship endures.
Additionally, candidates sounded off Friday about a “pension solutions plan” the council approved in September in order to honor its latest labor contract with the city’s blue-collar union. Under the plan, the city must raise $600 million by 2008, and they proposed raising about $100 million by selling city land and $400 million through pension obligation bonds. Issuing bonds would require an audit first.
While on the campaign stump this fall, Sanders said he supported pension bonds and wanted to examine the city’s land holdings before making a determination on land sales.
Gonzalez said she was opposed to the sale of land, “especially when the city doesn’t have a handle on what real estate it actually owns.” She said pension bonds would be an appropriate measure to restore funding to the beleaguered retirement plan.
Faulconer said he was against public land sales and would only consider pension bonds if they could be floated at rate that was advantageous for the city.
Hueso said land sales were a possibility because “the city wasn’t in the business of holding onto land,” but said he wanted to make sure the municipal government received fair market value for any property sold. He said pension bonds were a “safe way” to fund the system.
Acle said he didn’t believe in “fire sales,” but thought that selling land that served no real city function may be a good way to raise case for the city. He said he was uncertain about pension bonds, but was concerned with the concept of paying off one debt to create another.
– Alcohol at the beaches on Fourth of July: Faulconer said Thursday that he wants to allow the police chief the opportunity to make good on his pledge to remedy the alcohol-related incidents on Independence Day before making a decision to ban. Gonzalez proposes the reverse approach, saying the city should institute a trial ban on alcohol on the Fourth of July and compare the differences between an alcohol-free holiday and one that included alcohol at the beach.
– The future of Brown Field: The Otay Mesa airport should be looked at as an opportunity to attract industrial jobs, Acle said. Hueso agreed, but also noted there was support in the community to allow a private company to buy out the city’s contract and make the property into a redevelopment area.
– Living wage: The city could see an influx of contracts if it begins outsourcing more city contracts. The council could, hypothetically, repeal the living-wage ordinance it approved last year. Under the ordinance, which takes effect in July, companies that do a certain amount of contract work for the city would be required to pay its workers $10 an hour plus health benefits.
Gonzalez said living wage’s opponents were making low-income workers the scapegoat. Faulconer said he didn’t support the law because it was made at a time other city workers such as police officers and firefighters, were taking pay cuts because of budget constraints.
Hueso said he was happy with the current living-wage law. Acle said he opposed it and favored having the council review whether it should be repealed.
On Tuesday, the polls open at 7 a.m. and close at 8 p.m.
Please contact Evan McLaughlin directly at