Want the news summarized?
Subscribe to The Morning Report.

Tuesday, February 06, 2007 | Broadway Broadcasted

The Navy confirmed Friday that the Manchester Financial Group has been selected to redevelop the Navy Broadway Complex, awarding the local developer the right to build on and lease the nearly 15-acre waterfront property.

The announcement comes after a controversial selection process that was kept secret from the public. Navy officials said federal procurement rules prevented the bids from becoming public.

Manchester Financial Group is headed by Doug Manchester, a politically active developer who owns hotels such as the Manchester Grand Hyatt and the San Diego Marriot Hotel & Marina near the Navy property.

The Navy property was spared by the recent round of base closures made by Congress and the Pentagon after the city and Navy decided to redevelop the parcel, which includes drab office and warehouse buildings and sprawling parking lots. Under the conditions of the agreement, Navy Region Southwest must keep the current administrative functions on the property and retain ownership of the property.

City leaders hailed the arrangement as a way to provide input on the property as the North Embarcadero is planned to undergo a facelift to provide the city with a “front porch” for San Diego. The city of San Diego, port district, county, Navy and the Centre City Development Corp. are all working to implement the North Embarcadero Visionary Plan, which plans for a promenade along the harbor for jogging and walking, the development of hotels on Lane Field and a “grand entrance” that stretches from the Santa Fe train depot to San Diego Bay.

Manchester has the ability to lease the property for 75 years or more, but will be required to build the Navy’s facilities and adhere to federal building rules and the city’s planning laws. Any development on the Navy Broadway Complex is subject to review by CCDC and the San Diego City Council.

A formal announcement of the agreement will be made Monday.

— EVAN McLAUGHLIN

Mayor: Will Work for Money

Mayor Jerry Sanders said he has been assured by the Department of Homeland Security that the agency will reevaluate the decision to take San Diego off the list of areas that are “high risk” terrorist targets.

“I am pleased that the Department of Homeland Security was wiling to listen to our concerns and take another look at border proximity and the presence of military bases as risk factors,” Sanders said in a press statement Thursday.

Sanders has been in Washington, D.C., since Wednesday to lobby for more anti-terrorism dollars. The city of San Diego’s risk stats was downgraded earlier this year and may be ineligible for the Homeland Security Department grants if it remains on the list through next year.

EVAN McLAUGHLIN

Pension PR Bills

The San Diego City Employees’ Retirement System spent $61,092.47 on public relations and strategic communications from mid-2003 until early 2005, according to SDCERS records.

ANDREW DONOHUE

Take Two

After being a no-show to Tuesday’s City Council hearing, Wayne Kennedy will get another shot at being appointed to the retirement board next week.

The council confirmed Mayor Jerry Sanders’ nomination of retired banker and former Port District Chairman Peter Q. Davis to the San Diego City Employees’ Retirement System board, but postponed Sanders nominee Kennedy because he was absent from the hearing.

Kennedy, a former administrator at the University of California, San Diego, will get another shot at cracking the SDCERS squad at Monday’s council meeting. Pending confirmation, Kennedy would replace former trustee James Hearty, who resigned in January.

EVAN McLAUGHLIN

Surfing for Legal Turf

The battle has been resparked between San Diego City Attorney Mike Aguirre and several council members over the ability to authorize lawsuits on behalf of the city.

Councilman Jim Madaffer asked in a memo this week that the council be given a chance, either open or closed session, to weigh in on the conflict-of-interest lawsuit 

Aguirre claims Chapin used her position as a then-deputy city attorney to secure herself a job as the in-house lawyer for the San Diego City Employees’ Retirement System in 1998.

Madaffer said he was “particularly concerned over the possibility of a malicious prosecution lawsuit,” claiming that the city was vulnerable to pay damages and attorney fees that would result from such a complaint. Aguirre should have to explain the lawsuit, Madaffer said.

“I believe that the City should not be responsible for such damages and fees as this case was not authorized by the Council,” Madaffer told Mayor Jerry Sanders and Council President Scott Peters. “Therefore, these issues need to be addressed by the City Attorney to the entire Council so that the Council can make an informed decision as to the necessity of continuing such a course of action.”

Aguirre contends that he can rightfully file lawsuits on behalf of the city without the council’s approval because he is the independently elected head of the city’s legal department.

EVAN McLAUGHLIN

Totally Un-Kaloogian

Local congressional candidate Howard Kaloogian has fired up quite the Internet frenzy in recent days.

The former assemblyman, who is vying to replace former Congressman Randy “Duke” Cunningham in the 50th district, recently posted a picture on his campaign Web site that was supposedly of downtown Baghdad.

He used the picture and commentary to demonstrate how Baghdad was more peaceful than was being portrayed by the U.S. media’s coverage of the war.

Except, it turns out the tranquil-looking place in the photo wasn’t really Baghdad at all. It was Istanbul. Which is in Turkey.

After bloggers had a field day with the mistake, the candidate posted a new picture on his Web site, accompanied once again with the same criticism of the media’s coverage of the war.

Check out some of the uproar on political blog Talking Points Memo and on Editor and Publisher.

— SAM HODGSON

Inventory Up

Wednesday, March 29, 2006 — 1:39 p.m.

The number of downtown condos for sale edged up again after a one-week respite from almost week-on-week increases since the beginning of the year.

According to figures compiled by Lew Breeze, a Little Italy Realtor who has been keeping inventory statistics since 2003, there were 477 condos listed for sale in the 92101 ZIP code. Breeze compiles his data from the Multiple Listings Service.

The median price for downtown condos jumped up from last week, however, coming in at $640,000 compared to $636,250 in the third week of March.

Countywide, however, there was no break in the continual march upwards in inventory numbers.

The latest figures from ZIP Realty, a real estate market information service, show that there were 18,203 homes listed on the MLS as of Tuesday. That’s a big jump from 18,060 on March 23. The record inventory level for San Diego County is 19,000 homes and was reached in July 1995.

At this rate, we should see record levels of inventory by the middle of April.

— WILL CARLESS

Once Again

Another rainfall. Another beach closure.

Sewage-tainted runoff from last night’s rainfall closed beaches as far north as Coronado. Northward currents pushed the foul stuff north from the Tijuana River.

It’s the latest closure for the beaches in southern San Diego. Water access at Tijuana Slough Wildlife Refuge has been closed since Feb. 21 after a quarter-inch of rain fell.

— ROB DAVIS

Dancing Partners

Another one of those blogs dedicated to squeezing every last drop of data out of the real estate market, the San Diego Real Estate Report gives about as comprehensive an analysis of the market as any site I’ve seen.

It also offers up some gems from time to time, and I especially like the analogy it has up currently for the county’s real estate market:

“Do you remember your first high school dance? The girls stood on one side of the gym and the boys stood on the other. The teachers were cajoling the boys to go over and ask a girl to dance. A few boys made the move and soon there were a few boys and girls dancing in the middle of the basketball court. That’s what the real estate market is like in San Diego County right now. The only difference is you have to pay for this dance.”

“Sellers are on one side with their houses all prettied up waiting for buyers to come and make an offer. Buyers are on the other side, looking, looking, looking. Every now and then a real estate agent will get the two together to dance.”

Of course, the only problem is that this is a very expensive dance. Not all the kids can afford the cover charge, that’s why many are waiting at the door, waiting for the price to come down.

The girls are going to have to work out whether it’s worth lowering their standards to dance, or whether they are going to go home feeling disappointed.

WILL CARLESS

Emergency Fund Tapped

The City Council tapped into its emergency reserve fund today to pay for legal bills connected to the ongoing investigations into City Hall finances, explicitly opening the reserve fund for the first time in its fiscal crisis.

The Mayor’s Office said it had no choice but to open up the reserves to cover the $1.87 million expense, and the move exposed a number of past budgeting practices that new CFO Jay Goldstone described as “unusual” and “unsound.”

“This did not come lightly,” he said. “Typically, once you establish a reserve fund it should only be used in emergency.”

In a memo to the council explaining the use of reserves, Goldstone said his staff has identified $45 million in salaries and $35 million in revenues that were not recorded in the city’s fiscal year 2006 budget, but that will have to be recorded at year’s end.

“It is very, very unusual,” Goldstone said. “That is not the way you budget.”

He said that he was told such budgeting was a directive from the City Manager’s Office and had been going on for at least five or six years.

Goldstone said a number of atypical budget practices have left the city with a dishonest budget that does not accurately reflect its costs and revenues and has left its reserve fund vulnerable. He said the money for the legal bills likely would have eventually come from the reserve fund under previous budgeting principles, and that explicitly noting where the money was coming from was a more honest way of budgeting.

Previously, when the council has been asked to pay legal and consultant services related to the financial investigations and fiscal crisis, staff has recommended tapping into specific revenue sources that are projected to raise more money than previously budgeted. For example, if property tax revenues are expected to raise $10 more than previously thought, those funds were used to cover the unforeseen legal expenses.

However, that type of budgeting does not take into account that other revenue sources could finish the year below what was projected. That appears to have been the case in fiscal year 2005, when the reserve fund appears to have been tapped to cover a budget shortfall at the end of the year, Goldstone said.

The new administration, he said, has chosen to take the money from the reserve upfront and promised to replenish it either with fiscal year 2006 surplus money or funds from the upcoming 2007 budget cycle as they go about rearranging the city’s funds.

The city’s reserves are approximately $32 million, or 3.7 percent of its general fund budget. The city’s Blue Ribbon Committee on City Finances recommended in 2002 that the city’s reserve levels be at 7 percent to 10 percent. At the time, they were at about 4 percent.

A reserve fund is important to a municipality’s ability to withstand fiscal crisis, sudden downturns in the economy or emergency.

Please see Monday’s This Just In entry below for exact details on the legal bills approved today.

ANDREW DONOHUE

SDCERS: Undo Deals

The retirement board has asked a court to force the city to make up for its past practice of underfunding its pension plan, asking in a court filing last week that a judge nullify the two controversial pension funding deals that allowed the city to skirt its annual bill.

The lawsuit alleges, in part, that some current and former City Council members had a conflict of interest in approving two pension agreements.

While the retirement board did not list a dollar figure that the city owed to the pension fund, a separate but similar lawsuit is seeking a pension payment of between $174 million and $180 million to make up for underfunding practices that date back to 1996.

The court filing is the most recent episode in a series of legal battles between the city and San Diego City Employees’ Retirement System. Both sides are aiming to whittle down the city’s behemoth $1.39 billion pension deficit from different angles: The city is challenging the legality of enhanced pension benefits that are doled out by SDCERS, while the retirement system’s latest complaint shows that it is seeking from the city a larger payment into the pension plan.

Check tomorrow’s edition for complete coverage.

EVAN McLAUGHLIN

Update on Date

The date on yesterday’s This Just In posting informing readers to City Attorney Mike Aguirre’s forum for future leaders contained an error.

We originally wrote that the forum would be held on Wednesday — as in tomorrow. However, it will in fact take place on Wednesday, April 5.

We apologize for the error and have made the change. The forum, designed to teach tomorrow’s leaders of the future impacts of the pension problem, will be held in council chambers on the 12th floor of the City Administration Building at 202 C St.

— ANDREW DONOHUE

PSA for a Day

Almost 19 years have passed since Pacific Southwest Airlines called San Diego home. But US Airways, which purchased the company in 1987, is reviving the old airline’s look, dedicating a PSA-era throwback airplane Thursday.

Check out pictures of the plane, which is styled after the old aircraft and features the smiling cockpit that evokes memories of Snoopy.

US Airways is inviting retired PSA employees to come celebrate with company CEO Doug Parker.

— ROB DAVIS

New Name, Same Voice

We are excited to announce that we have legally changed our name to voiceofsandiego.org. Adding the “.org” to our official name in a variety of settings will help new readers find our site easier. We ask that readers, supporters and our media friends use the new name in reference to our daily, nonprofit, local news publication.

Thanks for reading and stay tuned.

voiceofsandiego.org Staff

Prices Only Go Up?

A poster on one of the blogs I’m keeping track of, http://bubbletracking.blogspot.com/, pointed out a few home price examples, along with a tongue-in-cheek comment that “Real estate only goes up, and if you don’t get in now, you’ll never get in.”

The posting reads as follows:

“2xx4 Garden House Rd, Carlsbad, CA 92009

So that was back in February 2005. That’s where it gets interesting. The poster then grabs a couple of more up-to-date listings from a sales release by the builder, and they read as follows:

“xxxx Huntington Dr, Carlsbad, CA 92009

xxxx Huntington Dr, Carlsbad, CA 92009

xxxx Huntington Dr, Carlsbad, CA 92009

It should be noted that the person posting these calls him or herself “OCRenter.” That’s usually a good sign that the person’s a “bubblehead” — i.e. a proponent of the real estate bubble theory.

Even so, it makes for interesting reading, and I get their point: these houses are going for 25 percent less than they were a year ago.

WILL CARLESS

A Funny Thing Happened…

City Attorney Mike Aguirre has scheduled a forum April 5 night for students and the general public entitled “Should Tomorrow’s Leaders Pay the Price for San Diego’s Financial Mess?”

Attendees are to discuss how programs and city services will be able to survive a pension deficit that is forecasted to chew up ever-growing chunks of the city’s everyday budget in years to come.

“Important programs and city functions will be forced to share an ever-shrinking pool of funds due to rapidly growing pension payments,” according to a press release. “… How will these programs and services survive without significant tax and fee hikes?

The aim of the meeting, the city attorney says, is to “better inform future leaders about the potential effects of the City’s looming pension debt and give San Diego’s young adults a chance to ask questions, offer solutions, and comment on the current financial crisis.” 

Young, old and in-between are encouraged to attend the forum, to be held in City Council chambers (12th floor, 202 C St.) from 6 p.m. to 8 p.m.

— ANDREW DONOHUE

Legal Bills: Good News

The city of San Diego has received a rare bit of good news related to legal bills: a federal appeals court ruled that insurer AIG must pay the city’s legal bills in the drawn-out court battle with developer Roque de la Fuente.

The ruling means AIG is on the hook for the past, present and future expenses incurred by the city for lawyers, expert witnesses and consultants working on three lawsuits that Roque has brought against the city in a dispute related to the developer’s land in Otay Mesa, said Kris Wilkes, an attorney at Latham & Watkins, the firm representing the city.

To date, the city has racked up $6 million in costs that AIG will be forced to cover, Wilkes said.

The city owes de la Fuente more than $100 million, a figure that is growing with interest, as a result of a 2001 verdict. The city is currently appealing the case.

— ANDREW DONOHUE

Commie Train

A San Diego County Regional Airport Authority’s committee greeted a study about building a magnetic levitation train from San Diego to a proposed Imperial County airport with skepticism and a bit of disdain earlier today.

A San Diego Association of Governments study concluded that building a maglev train was feasible, but risky.

Risky, because only one exists in the world, running from Shanghai to the Chinese city’s airport. No one is quite sure what costs would be associated with it.

“It’s great that they have 39 miles of it that works in some Communist country,” board member William Lynch said. “But will it work here?”

That’s still up in the air. (For the record, it’s only a 19-mile train.)

Check out my story tomorrow for information about the strategic planning committee’s proposal to study a commercial-only airport — not a joint-use airport — at Marine Air Corps Station Miramar.

ROB DAVIS

Crappy Vandals

Vandalism of a sewer main in Ramona caused an estimated 82,500-gallon sewage spill this morning, sending the smelly stuff into a creek that feeds the San Vicente Reservoir.

The reservoir isn’t currently being to supply drinking water, according to a release from the San Diego County Department of Environmental Health. Officials are monitoring water quality to see if recreational activities scheduled later this week will continue.

The spill started around 6:45 a.m. and was contained by 9:15 a.m., when crews from the Ramona Municipal Water District removed debris obstructing the sewer main.

The city of San Diego had five vandalism-related sewer spills last year, said Michael Scahill, spokesman for the city’s Metropolitan Wastewater Department. The city has since started locking down manholes in out-of-sight canyons. Scahill said city crews recovered construction debris, car fenders and even a bowling ball dumped into sewer mains last year.

— ROB DAVIS

Potential Power Pollution

A local environmental group released a study today suggesting that plans to build a new power plant in the South Bay would yield dangerous levels of pollution that could cause increased rates of asthma, lung disease, heart attacks as well as decreased lung function and in some instances, premature death.

Released by the Environmental Health Coalition, the study recommends that instead of building a 650-megawatt plant, the company that owns the current power plant’s lease should build a 65-megawatt plant and focus on renewable energy.

But representatives from Duke Energy said that false assumptions in the EHC’s report yielded results that overstated the severity of the potential pollution.

Andy Trump, project director for the South Bay energy facility said environmental- protection technology in the new plant would be more up to date than it is in the more than 40-year old plant. A new plant will be able to power 500,000 households and do so more efficiently than the current plant, he said.

The EHC is asking that the Unified Port District of San Diego, landlord of the power plant site, take environmental consciousness a step further than upgrading technology and use the opportunity to improve the quality of life in the area. The port has mandated that Duke make its “best effort” to replace the existing South Bay Power Plant by 2009 and the EHC wants the port to study using renewable resources.

“They are only promising to keep air pollution levels at where they are now, or underneath it,” said Rebecca Pearl, an EHC spokeswoman. “This report shows that even at current levels, this big plant is still a big polluter.”

Duke Energy disagrees and points to a 2004 study by the San Diego Air Pollution Control District that puts the current South Bay facilities relatively low on the list of polluters in San Diego County.

The EHC recommended that the port hold public forums on the issue. Port spokesperson Irene McCormick said that all options are still on the table, including renewable energy, and the Port looks forward to holding forums in the near future.

The EHC study suggests that a 650-megawatt plant would yield 3 to 4 times higher levels of particulate matter — a minute substance that can pose health risks — than a smaller 65-megawatt plant.

There are about 60 schools within a five-mile radius of the proposed plant, where the impact would exceed the national standard for air pollutants. Duke Energy representatives said the effects of the pollutants from the current South Bay plant are negligible on public health.

The current South Bay facility runs at 30 percent capacity, meaning that if the 700-megawatt plant uses slightly less than one-third of its potential. Officials say that even if the new plant used 100 percent of its 650-megawatt potential, it still would only put out pollutants at the same rate as the old plant.

— SAM HODGSON

Legal Loot

The San Diego City Council will decide Tuesday whether the city should spend another $1.38 million on attorney fees incurred by its elected officials and employees related to investigations into the city’s financial dealings.

The expenditure, if approved, adds to the $2.38 million the city has spent on legal representation for City Council members, former Mayor Dick Murphy and employees.

Several former and current members of the City Council and Murphy have requested another $927,000 be paid out to the attorneys who are representing them before the various agencies that are probing the city’s books and pension funding arrangements. The Securities and Exchange Commission, Justice Department, the District Attorney’s Office and the City Attorney’s Office all have ongoing investigations.

Attorneys for Murphy, Council President Scott Peters, former Councilman Ralph Inzunza and Councilmembers Jim Madaffer, Brian Maienschein and Toni Atkins have already received $851,000 for their work. Pending the council’s approval Tuesday, legal fees for the council could reach $1.78 million.

Lawyers for various former and current city administrators and employees are requesting $450,000 for their work after receiving $1.52 million over the past two years.

Also, the city has hired the Latham & Watkins law firm to defend it and former and current officials and staff in a lawsuit brought by the police union. The Police Officers Association is suing to force the city to make up for the city’s past practices of not paying enough into its employee retirement fund, which currently has a shortfall of $1.39 billion.

Latham & Watkins is asking for an additional $500,000 to defend the city, its officials and employees in the POA case, bring the total potential cost of that litigation to $700,000 for the city.

— EVAN McLAUGHLIN

Remer Trial Starts Tuesday

The U.S. attorney’s case against local Democratic consultant Larry Remer will see the light of the courtroom Tuesday when a jury hears allegations that the politico conspired with the superintendent of a South Bay community college to use public money to fund a political campaign.

U.S. District Judge John Houston was slated to preside over the jury trial weeks ago, but the hearings were delayed because of a scheduling backlog.

A grand jury indicted Remer and former Southwestern Community College Superintendent Serafin Zasueta for allegedly paying for a television commercial from the Proposition AA campaign in 2000 with community college money. It is illegal to use public funds for political campaigns.

The college purchased tapes of a commercial supporting the $89 million bond referendum from the Virginia-based media company with the stated intention of teaching students about political advertising. However, the purchase came after the committee supporting Prop. AA learned it had an outstanding bill with the commercial makers after the election had passed.

— EVAN McLAUGHLIN

Civil Suit Circus

City Attorney Mike Aguirre and the attorneys for eight former and current city and pension officials showed up to court Friday to argue over a tentative ruling that amounted to a “mixed bag” — as the judge said — in the conflict-of-interest lawsuit.

One defendant has been stricken from the case and Aguirre is trying to prove that the other seven all had improper financial interests in controversial pension deals dating back to 1996.

The civil lawsuit’s defendants are former retirement Administrator Larry Grissom; the pension system’s former attorney, Lori Chapin; former Deputy City Attorney Bruce Herring and five former pension trustees — firefighters union President Ron Saathoff, management analyst Sharon Wilkinson, former Assistant City Auditor Terri Webster, fingerprint examiner John Torres and former Human Resources Director Cathy Lexin.

Aguirre’s case, which he admits is a back-up plan to a separate legal challenge as part of his efforts to knock $700 million off the city’s $1.39 billion pension debt, is based on a state law that exempts salary and pension benefits from being used against an official who is accused of having a conflict of interest under that statute. So far, the case has centered on Aguirre trying to prove that the defendants were rewarded in other ways than just the blanket pension enhancements that all other city employees received.

Superior Court Judge Steven Denton tentatively agreed with Aguirre’s claims that all of the defendants besides Herring are being accused of receiving payoffs other than salary or pension increases. The judge allowed Herring to be dropped from the lawsuit.

Aguirre is trying to convince the judge to move forward on the case because the remaining defendants either received a special pension benefit that other employees did not get, such as the promise of legal indemnity for the pension trustees, more pay solely for Grissom, a new job for Chapin or special benefits that Webster and Saathoff were eligible to receive.

Defense attorneys are contesting the validity of all those points.

Aguirre and the other attorneys have 10 days to straighten their arguments on those issues, and the judge is expected to take another 10 days to hand down a final ruling on the defendants’ attempts to have the case dropped.

— EVAN McLAUGHLIN

Magneto Meeting

The San Diego County Regional Airport Authority’s strategic planning committee will weigh in on the magnetic-levitation train discussion when it meets Monday morning at 10.

It’ll be the first formal presentation of the San Diego Association of Governments study, which has been touted by U.S. Rep. Bob Filner, D-Chula Vista, as an answer to questions surrounding the viability of an airport in Imperial County.

The study found that a maglev train would be feasible but expensive — between $15 billion and $25 billion, depending on the route.

The committee will also get a look at basic criteria applied to the military bases being studied for possible joint civilian-military use. We wrote about that issue when it was brought up at a board meeting earlier this month.

Check out the brief Monday agenda here.

— ROB DAVIS

Real Accurate

The National Association of Realtors issued a report this week about home sales that said nationwide sales had rebounded in February, and they had an interesting reason why.

“Weather conditions across much of the country were unseasonably mild in January and likely were a factor in higher levels of buyer activity, which boosted sales that closed in February,” the association’s Web site quotes David Lereah, NAR’s chief economist as saying.

I’m a skeptic. I called a weather expert.

He said the weather in January nationwide was “incredible.” In fact, he said the difference between this January’s temperature and the normal temperature for January was the largest difference ever. He was very excited about it.

Which only leads me to conclude that home sales were, indeed, kept buoyant by the unseasonably warm weather in January.

Outside, the sun’s shining. Could be a good March too?

— WILL CARLESS

More CAR Legislation

In addition to a bill it’s sponsoring aimed at increasing professionalism among its swollen ranks, the California Association of Realtors has more legislation on the way.

The bill, which the California Assembly Business and Professions Committee approved Tuesday, addresses applications for real estate brokers’ licenses.

Brokers’ licenses are distinct from salespersons’ licenses, which are the standard for real estate agents. Real estate agents essentially work underneath brokers, who hold their licenses. Having a brokers’ license allows salespeople to work independently and represent themselves in a transaction. Brokers’ licenses are much harder to get and allow the licensee to have a number of salespeople working for them.

Existing law requires applicants for a brokers’ license to have a valid salespersons’ license and have worked as a salesperson for two years. The current law also allows applicants without experience to apply if they have graduated from a four-year college or university course with a specialization in real estate or if they have equivalent experience.

The new bill would require all applicants for a brokers’ license to have two years experience as a real estate agent. Even graduates from a four-year course would still need the requisite experience before getting their brokers’ license.

The reasoning for the new legislation is explained briefly on the CAR’s Web site.

“Because a so-called ‘degree broker’ can get a license without any experience, and hire any number of sales licensees to work under his or her license, brokers who have never sold a house may be supervising salespeople who themselves have never completed a transaction.”

And we don’t want that now, do we.

— WILL CARLESS

Prices Steady, Sales Dropping

A press release just put out by the California Association of Realtors shows San Diego’s housing prices remaining relatively steady but sales dropping off significantly.

The median price of an existing home in San Diego County rose slightly in February, from $605,600 the previous month to $608,700. The median price is up 4.6 percent from February last year.

The number of home sales in San Diego was up 4.8 percent from January, which is traditionally a very weak month for sales, but decreased by 14 percent compared to February 2005.

“Sales posted a slight increase last month compared with January 2006, as the downward drift in interest rates late last year caused an uptick in market activity,” the press release quotes CAR President Vince Malta as saying. “As expected, year-over-year sales continued to decline from the robust levels of a year ago.”

With San Diego’s home inventory at almost-record levels, the California Association of Realtors Chief Chief Economist, Leslie Appleton-Young, expressed some measured concern about price appreciation.

“We expect the pace of price appreciation to slow from the 13 to 17 percent range of 2005 to 10 percent this year as rising inventory levels mitigate some of the upward pressure on home prices,” the press release quotes Appleton-Young as saying. “The higher-priced coastal areas will see price gains in the mid-single digits while the inland areas will see increases in excess of 10 percent.”

WILL CARLESS

Inventory Tops 18,000

The number of homes up for sale in San Diego County rose above 18,000 this week, continuing its rise towards a record of 19,000 set in 1994.

As of March 20, there were 18,003 homes listed on the county’s Multiple Listings Service, according to ZIP Realty, a real estate information service.

Realtors have ben adding, on average, 35 homes a day to the MLS since the beginning of the month. At that rate, the record of 19,000 will be reached by the middle of April.

— WILL CARLESS

Another Stab at SDCERS

City Attorney Mike Aguirre is pursuing his goal to regain his office’s jurisdiction over the retirement system’s legal affairs from a different angle, filing a lawsuit Thursday against former San Diego City Employees’ Retirement System general counsel Lori Chapin.

In the lawsuit, Aguirre alleges on behalf of the city that Chapin had a conflict of interest when she helped create an agreement between the City Attorney’s Office and the SDCERS board to establish a new independent legal office at SDCERS. The lawsuit argues that Chapin, who provided legal advice to SDCERS as a deputy city attorney, improperly benefited from the office’s creation by positioning herself to become the pension system’s chief legal counsel.

Aguirre claims the 1998 contract that created the general counsel position should be declared void and that the City Attorney’s Office should be reinstalled as the system’s legal department.

The city attorney failed this month to sway Superior Court Judge Jeffrey Barton that he was the chief legal advisor for SDCERS, and the judge sided with the retirement system’s claim that it should have separate counsel. Aguirre originally said he would not appeal that portion of his case against SDCERS, which also aims to strip away $700 million in pension benefits from the city’s $1.39 billion pension shortfall, but vowed to campaign against the judge the next time he is up for election. This week he filed a motion to reconsider with the judge.

— EVAN McLAUGHLIN

Curious George

Mayor Jerry Sanders got some face time with President Bush and Vice President Dick Cheney this morning at the White House.

The mayor spent 90 minutes talking immigration reform proposals with Bush, Cheney, Commerce Secretary Carlos Gutierrez and a handful of other officials, said Fred Sainz, the mayor’s spokesman.

Sanders also met with the Homeland Security Council to lobby against the plan to remove San Diego from a list of cities eligible for grant funding through the Urban Area Security Initiative.

“This was in essence building blocks to put a name with a face and a face with San Diego,” Sainz said.

— ROB DAVIS

Step Into My Office

Three City Council members confirmed Wednesday that they were handed subpoenas from the City Attorney’s Office that seek the officials’ depositions.

City Attorney Mike Aguirre has requested that Council President Scott Peters, Councilwoman Toni Atkins and Councilman Jim Madaffer answer questions related to his lawsuit against the retirement system. Aguirre is hoping a court rules to knock $700 million off the city’s $1.39 billion pension deficit.

The episode is the latest in a contentious debate over the city attorney’s role, in which Aguirre argues that he is an independent officeholder who serves the public’s interest. Several council members say he should represent them.

Peters said he would rather speak with the city attorney in the confidence of attorney-client privilege instead of having to use a separate attorney at taxpayer expense. Aguirre would not comment when asked about the depositions Wednesday.

— EVAN McLAUGHLIN

Open for Business

The North American Development Bank — a rare funding source for cross-border public health issues that plague the San Diego region — appears to have escaped the gallows, though U.S. Treasury officials are continuing to search for ways to make it more effective.

When we wrote about the bank last week, its future was up in the air and the border’s congressional representation was freaked out. The bank was founded 12 years ago as an environmental concession to the North American Free Trade Agreement, an acknowledgment that NAFTA would exacerbate existing health issues in the border region.

But U.S. Treasury officials and their Mexican counterparts at Hacienda recently began discussing the bank’s mission, and many border representatives — including U.S. Rep. Bob Filner, D-Chula Vista — had petitioned Treasury Secretary John Snow to keep the bank open.

“We have no immediate plans to close the bank,” Treasury spokeswoman Brookly McLaughlin said today. “But we do have on-going concerns with the bank, particularly the lending function.”

McLaughlin pointed out that the bank issued $24 million in loans in the United States in the last 12 years, while incurring $60 million in administrative costs. To be clear: it cost $60 million to loan $24 million.

But Juan Antonio Flores, the bank’s spokesman, said that figure is misleading and expressed worry that the Treasury Department would use skewed numbers to justify closing the bank.

The bank’s overhead was incurred not only while lending money in the United States, but also while lending $80 million in Mexico, Flores said. An additional $100 million in loans are pending. The administrative costs also include awarding and giving technical assistant to $600 million in grants the bank has given on behalf of the U.S. Environmental Protection Agency.

Flores acknowledged that changes need to be made to improve the bank. He said it would benefit by expanding its lending criteria to encompass private companies and public-private partnerships. Awarding more loans in the United States would allow the bank to redirect those profits into grant development, Flores said.

“It’s time to reassess from scratch the role of the institution,” Flores said, “especially from the U.S. side.”

ROB DAVIS

One More Auditor

Councilwoman Donna Frye announced today that the Mayor’s Office had accepted her request for an audit to determine if money from increased sewer and water rates in 2002 was indeed spent toward sewer and water infrastructure improvements.

In a memo authored today, city CFO Jay Goldstone tells Frye than an auditing firm will be chosen within the next month and a full report will be available in two or three months.

The probe will be separate from those undertaken by two other auditing firms and an audit committee, who have been scouring the city’s books back to 2003 in attempts to eventually release the long-delayed fiscal year 2003 audits.

ANDREW DONOHUE

$700K in Pension Bills

The pension system has paid out nearly $700,000 in legal bills for its current and former board members and staff in connection with the system’s strife and the Justice Department’s ongoing federal investigation.

The pension board’s decision last week to pay the legal bills for two former staff members who have been indicted on federal corruption charges caused quite a stir, in part, because of the potential cost to the troubled pension fund. It is estimated that their bills will reach into the hundreds of thousands of dollars.

But a number of staff and board members were interviewed by federal investigators prior to the Jan. 6 charges brought against five former pension officials and the system has paid  $697,500 for their legal representation. 

The pension system covers legal fees for board and staff members when they are involved in civil lawsuits or called as witnesses in a criminal investigation. Until Friday, the board didn’t pay legal bills for staff once they’d been officially charged with a crime. However, last Friday the board voted to pay the legal fees for indicted former staff members Lori Chapin and Larry Grissom, who have been accused of fraud and conspiracy by the U.S. Attorney’s Office.

In addition to Chapin and Grissom, three former pension board members have also been charged in connection with a 2002 pension pact at the heart of the city’s ongoing woes.

The three remaining defendants may ask the pension board to do the same for them. An attorney for one of the three told Voice of San Diego yesterday that requesting the pension board to pick up their legal tabs is “something that must be considered, definitely.”

The legal bills, obtained by the Voice through a Public Records Act request, are heavily blacked out. The duties performed by most of the lawyers are blacked out and some bills are so heavily redacted that it is impossible to determine for which employee or trustee the legal work was performed. 

Several defendants in the federal case, and a similar one brought by the district attorney, are having troubles retaining their lawyers because of the financial burden imposed by the case.

ANDREW DONOHUE

Thinking of moving to sunny San Diego? An inquisitive poster on the Craiglist.org housing forum is, and he asked local people to give him their opinions on the different neighborhoods of San Diego.

I particularly liked this reply, as amusing as it is comprehensive:

“Downtown: Want action/Got bucks or a tolerance and old, rundown — but hip place.

PB: Drink or surf. Better yet, drink and surf/Got bucks or don’t mind two or three roommates in a noisy complex.

MB: Drink a lot and surf a lot./Got major money or don’t mind living with three or four roommates in a noisy complex.

OB: Want granola? Soy? Cheap wine? Surfing?/Got some money or don’t mind roommates? How do you feel about the more than occasional angry wino? Great neighborhood feel, but can be scary.

La Jolla: Want to be away from the riff-raff./Got lots of money or lots of roommates. (BTW: La Jolla is really kind of a small town at night. Sure they gots lots of expensive shops, but it is DEAD at night.)

UTC: (Pretends to be part of La Jolla) Want UCSD education, or a ‘safe’ place to live and don’t care that you must drive to do anything but sit at home and know that your ‘neighborhood’ is just a collection of affluent transients./Got some money or can tolerate roommates.

Clairemont/Mira Mesa/Kearney Mesa/Serra Mesa/ San Carlos: Nobody in their 20s really ‘wants’ to live there.

Mission Valley: Same as UTC, but a little less pricey, a little less affluent. Okay — and a little more “party” oriented: drinking & casual sex. Lots of frat and sorority types.

Golden Hills: Want hip, neighborhood, walk to stuff, be sort of near downtown./Got tolerance for some shady types and dicey blocks.

North Park: The great catch-basin for 20 somethings: Semi-hip, semi-scary, semi-reasonably priced. Almost everyone ends up in NP at some time in their life.

Hillcrest: Hip, gay/Need dough

University Heights: Hillcrest east — a little less hip, a little less gay/A little less dough

Normal Heights: University Heights east: Still less hip and less gay-but catching up!/Reasonably priced, but some scary streets in NH. Some nice streets, some good restaurants, but some scary streets — south of Adams can be tough.

City Heights/East San Diego/Chollas/Logan: Are you adventurous? Do you like street entrepreneurs? Pit bulls? Cheap housing there.”

Hope that helps any would-be San Diego transplants.

— WILL CARLESS

Moye Plus One

Voice of San Diego infantile issues columnist David Moye and his wife had a healthy baby boy Tuesday at 9:51 a.m. If there are any astrology experts out there who may know what that means for little Owen’s future, be sure to share.

Moye’s readers may remember his offer to give naming rights of the boy to any private school that might enroll him for free. Turns out, Moye’s son will have a middle name of Brian. It appears no school took them up on the offer.

— SCOTT LEWIS

Leave a comment

Your email address will not be published.

This site uses Akismet to reduce spam. Learn how your comment data is processed.