How the Big Redevelopment Deal Affects Prop. D

Supporters of Proposition D have have touted their broad coalition, saying the ballot measure is the solution to the city of San Diego’s financial problems. You have Republican Mayor Jerry Sanders, business leaders such as the San Diego Regional Chamber of Commerce and union leaders such as the San Diego-Imperial Counties Labor Council all backing Prop. D’s tax increase and financial reforms.

Friday, those same interests came together to promote another major effort: the sudden state deal to extend the life of downtown redevelopment. The law removes the major hurdle preventing the city from having the means to finance a new Chargers stadium. And, proponents say, it creates jobs.

Under redevelopment, the city captures a larger share of the taxes that would’ve flowed to the county government and school district in order to invest it back into a blighted neighborhood and subsidize development.

But for such a significant issue, the deal was done in stunning secrecy. It was proposed in the midst of Thursday’s all-night budget negotiations, attached to a budget provision that had been crafted to protect rural farmland from development. It passed the Legislature on Friday. Shocked opponents criticized the measure as corporate welfare for the Chargers.

The deal also cut out two key players: San Diego’s City Council and San Diego County supervisors.

So never mind that Sanders had promised a transparent process to decide if lifting the cap would benefit the city. Or that now the city has agreed essentially to divert money from its day-to-day operating budget to pay for a Chargers stadium. This news, of course, comes at a time when they’re all trying to convince the public the city is so cash poor, it needs to raise taxes to keep from laying off police officers and firefighters.

All this evidence is proof, said Councilman Carl DeMaio, a Prop. D opponent, that voters can’t trust city leaders with their promises of reform on Prop. D.

“That whole public process was completely disregarded in favor an 11th hour closed-door, politician to politician deal,” DeMaio said. “That’s not what San Diegans deserved. But that’s what they’re going to get. That’s what they got on this deal. That’s what they’re going to get on Prop. D.”

DeMaio, one of the originators of the proposal to lift the cap, said a public debate on downtown redevelopment would have ensured the city received a good deal. Conflicting reports from the city’s budget analyst showed San Diego’s day-to-day operating budget could lose $300 million in property taxes, but also gain more than that amount in increased sales and hotel room taxes. Now, the effect of lifting the cap on the city’s day-to-day budget is unknown.

DeMaio also said he wanted any cap increase tied to the downtown redevelopment agency paying down debt for Petco Park and a previous Convention Center expansion. Now, he said, there’s no guarantee any of these things will happen.

In June, Sanders urged City Council to spend $500,000 to take the next 18 months examining the downtown redevelopment cap. Everyone, he said, needed to take the time.

By moving forward with this study, all of us, you, me and the public will be able to have the right data to make a wise decision months from now. This is a transparent and open step by all of us to see if we can benefit the entire city by changing the cap in downtown. I urge your support and look forward to working with all of you on this important analysis.

The council agreed with the mayor.

Please contact Liam Dillon directly at liam.dillon@voiceofsandiego.org or 619.550.5663 and follow him on Twitter: twitter.com/dillonliam.