More than $700,000 should go a long way to patching a surprise hole in the funding for rehabbing the next eight buildings in the arts, culture and nonprofit district in Point Loma.

The City Council today voted 7-1 to approve the request by the nonprofit managing the construction effort, the NTC Foundation. Councilman Carl DeMaio opposed it, but didn’t say why during the hearing.

The unexpected gap came because the foundation found out that it would have to pay government-set “prevailing wages” on all eight buildings, not just the three buildings involving the $4 million in city funds that had already been granted.

Why did this happen on the second phase when the structure worked just fine on the first seven buildings?

That came up in the meeting this afternoon.

Turns out there was an appellate court opinion issued last December (years after the first phase was completed) ruling that projects like these can’t be split up to avoid paying those government-set wages on the whole thing, according to Deputy City Attorney Nathan Slegers. If you involve public funds, your whole project triggers the requirement to pay the government-set “prevailing wages.”

“That’s just real unfortunate,” replied Kevin Faulconer, the councilman whose district houses the project. “To have this on top of all of the other issues makes it very, very difficult.”

Faulconer said it was “good news” that the foundation was able to secure a partial refund from the county for the property tax bills and penalties the city covered. But he wishes the city could use that money for something else in the project instead of paying the increased wages, he said.

“We seem to be followed around by incidents we have no control over,” said Richard Ledford, chairman of the NTC Foundation’s board. “This is one of them.”

Foundation CEO Pam Hamilton Lester said the city’s approval means the financing package should be signed on Friday and the construction efforts for the next eight buildings in the district can begin Monday.

I’m Kelly Bennett, the arts editor for VOSD. You can reach me directly at or 619.325.0531.

And follow Behind the Scene on Facebook.

Kelly Bennett

Kelly Bennett is a former staff writer for Voice of San Diego.

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