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Thursday, Oct. 16, 2008 | City Attorney Mike Aguirre has amended the prosecution of former Centre City Development Corp. President Nancy Graham, adding two more criminal charges claiming she improperly participated in negotiations about the massive Ballpark Village project.
Graham already faced three conflict-of-interest and ethics charges, filed last month, stemming from her involvement in the selection of the Related Cos., a New York-based development company, as CCDC’s preferred developer of a 41-story, $409-million hotel and condominium project on city-owned land downtown at 7th Avenue and Market Street.
The additional misdemeanor charges, filed Tuesday in San Diego Superior Court, expand the scope of Aguirre’s prosecution of Graham, who resigned July 24. They allege that Graham improperly influenced the Ballpark Village project knowing it could benefit Lennar Corp., a nationwide homebuilder that had been Graham’s business partner.
State and local laws prohibit public officials from influencing decisions that can benefit themselves, their spouses or their business associates. The laws extend the prohibition for a year after receiving money from a source.
The link between Graham and Lennar is clearer than her connection with Related. Lennar is a publicly traded Florida-based company. The Related Cos., which is privately owned, in turn owns a minority share in The Related Group, Graham’s Florida-based business partner. Graham’s attorney, Paul Pfingst, has pointed to that connection as something he will attack in his defense. State law says companies are connected when one of several conditions is met, such as whether one controls the other, they have shared management or a close working relationship.
Aguirre declined comment; Pfingst did not immediately return calls for comment.
Before moving to San Diego in 2005 to head the downtown redevelopment authority, Graham worked as a developer in Florida, where she had a business relationship with Lennar and the Related Group, a large Florida development company partly owned by the Related Cos. Together, they built a mixed-use condominium project, a partnership that Graham estimated had paid her almost $3 million through 2007 — including a $125,000 payment that came in mid-2007.
Testifying under oath last year in a lawsuit deposition, Graham admitted receiving the money, but she did not report it on the annual conflict-of-interest form that public officials are required to submit to the city.
While at CCDC, Graham participated in numerous negotiations about Ballpark Village, a development proposed adjacent to Petco Park, which will include 3 million square feet of mixed-use residential, retail, hotel and office uses. Lennar partly owns the underlying 7.1 acres on which development would occur.
She also participated in negotiations about the Related Cos. project at 7th Avenue and Market Street downtown.
The fallout from Graham’s business ties has been fast and far-reaching. She initially said she had recused herself from the project and had sold her interests from her development project with the Related Group and Lennar in “early 2006.” However, court documents and her personal calendars later contradicted those statements.
Since Graham resigned, CCDC’s board has discarded 7th and Market, but not Ballpark Village. CCDC staff will be required to document the reasons for any changes to the Ballpark Village proposal at the end of ongoing negotiations with the development team led by JMI Realty, Padres owner John Moores’ company.
An internal investigation has brought about greater scrutiny of CCDC projects and forced the delay of the new City Hall proposal.
Graham is scheduled to be arraigned Thursday morning. No trial date has yet been set.