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Friday, July 25, 2008 | Nancy Graham, president and chief operating officer of the Centre City Development Corp., has resigned, making her the second top executive to leave a city redevelopment agency in 24 hours.

Graham, who has served as CCDC’s president since Dec. 1, 2005, cited concerns about her mother’s declining health as her reason for leaving the city’s downtown redevelopment arm. Graham has been in Tennessee for six weeks caring for her mother, who is suffering from Parkinson’s disease and dementia, and said she could not continue “to try and operate CCDC from Nashville.”

“I think my responsibility to my mother is the greatest at the present time,” Graham wrote in a midday e-mail Thursday announcing her resignation to CCDC Chairman Fred Maas. “Accordingly, I feel it appropriate for me to resign effective immediately as President of CCDC. This is one of the most difficult decisions I have ever had to make.”

Graham’s resignation, which closely followed the Wednesday firing of Carolyn Y. Smith, the Southeastern Economic Development Corp.’s president, comes at a time when the city’s two nonprofit redevelopment entities are facing increased scrutiny about their operations. The city is expecting the results of an audit of SEDC within weeks, and the Mayor’s Office launched audits of CCDC and other city nonprofits Thursday.

While Smith lost her job after a hidden bonus system was uncovered, Graham has drawn attention for her changing story about her involvement in negotiations with the developer of a $409 million downtown skyscraper. She was a former business partner with a sister company of Related of California, the developer of a 41-story building downtown at 7th Avenue and Market Street, and met with the company during the deal’s negotiation process, despite saying publicly she was not involved.

A copy of her calendar, obtained by voiceofsandiego.org, revealed that she had attended negotiation meetings.

Graham did not specifically address the development controversy in her resignation e-mail, but did write, “It is always painful for me to see a negative story about CCDC because I know the public can never appreciate all the time, effort, diligence and integrity the Board puts into its governance.”

Maas said Graham was not asked to resign and said her involvement in the development deal had not played a role in her resignation. “I have enough respect for her to take her at her word,” Maas said, recalling that Graham first raised the idea of resigning three weeks ago.

Maas encouraged Graham to take more time to consider it. “She reached the point where it just became insurmountable,” he said.

City Councilman Kevin Faulconer, whose district covers downtown, said Graham’s evolving story had been a concern, however, and said the city should use her departure as an opportunity to evaluate the roles the two nonprofit redevelopment agencies serve.

While Mayor Jerry Sanders maintains the two agencies are structurally sound, Faulconer said the City Council should be open to revamping CCDC and SEDC. “It’s always important in any business operation to look at the structure. Is it working the way it’s intended?” he said. “That kind of review is healthy.”

The two nonprofit agencies were formed by the city of San Diego to handle redevelopment efforts in their specific neighborhoods and are funded by tax dollars. Their major decisions must ultimately be approved by the City Council.

Fred Sainz, a Sanders spokesman, said the mayor believes both agencies should continue to operate under the same structure. “These were established to run like private sector corporations, because redevelopment was such a priority,” Sainz said. “By and large, that structure, that philosophy has proven to be the case and be sound.”

Graham came to San Diego after a career in development and politics in West Palm Beach, Fla. She served as the city’s mayor from 1991 to 1999, leading efforts to redevelop the city’s downtown, culminating in a $500 million project known as CityPlace, which was built by a company called The Related Group.

After leaving office, Graham became business partners with one of the company’s subsidiaries, the Related Group of Florida, jointly developing a $100 million waterfront condominium project in Lantana, a city 10 miles south of West Palm Beach.

Graham went back to public service in 2003, while the condo construction project moved forward, taking a job as executive director of West Palm Beach’s Downtown Development Authority.

Her continuing relationship with Related caused friction while Graham served as the authority’s director, leading to a well-publicized rift with current West Palm Beach Mayor Lois Frankel, who told a local newspaper in 2005 that she’d become uncomfortable with Graham’s ties to Related. In a May interview, Graham dismissed Frankel’s comment as politically motivated and designed to keep Graham from running for mayor again.

Graham subsequently resigned that redevelopment post in 2004, citing concerns about her mother’s health.

When she moved to San Diego, Graham took CCDC’s helm from longtime president Peter Hall. While previous presidents have landmark downtown projects to point to as legacies, such as Petco Park and the convention center, Graham’s tenure has primarily focused on infrastructure improvement projects, said Gary London, president of The London Group. She has helped fill in the services and infrastructure left unattended while downtown focused on those mega-projects, London said.

“She dedicated her era to building bridges, parks, police stations, filling in the infrastructure requirements,” London said. “CCDC has become substantially more administrative and public infrastructure-oriented than they were during the Peter Hall era.”

But few landmark projects were completed while Graham was CCDC’s president. The Navy Broadway Complex languished through legal battles; the city’s downtown library project continued to struggle to find funding; the idea to redevelop City Hall was born but has only begun taking its first steps.

Maas and Jennifer LeSar, a CCDC board member, pointed to the organization’s focus on improving parks, downtown architecture and a downtown community plan update as hallmarks of Graham’s tenure. “Transparency during her tenure has been without rival,” Maas said.

Wayne Raffesberger, a former CCDC board member who served when Graham was hired, said she generally lived up to the promise she’d demonstrated during her job interviews. “I think she did a good job,” Raffesberger said. “But to have done a great job would’ve required the perfect person.”

Peter Q. Davis, a former longtime CCDC board member, said Graham had been too political in her role.

“I always thought she was more interested in the aesthetics — flower-boxes — than the long-term development,” Davis said. “She got here and abdicated that, and didn’t care about the legacy of the city’s redevelopment efforts.”

Barbara Kaiser, CCDC’s vice president of real estate operations, had filled in for Graham in her absence and will continue in that role. Kaiser, who joined CCDC in May 2006, is the former redevelopment manager for the city of Long Beach.

Please contact Rob Davis directly at rob.davis@voiceofsandiego.org with your thoughts, ideas, personal stories or tips. Or set the tone of the debate with a letter to the editor.

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