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The Bahia Hotel’s unusual lease deal has yet another odd feature: It might not have been legal.
After being threatened with a lawsuit, the city of San Diego is going to revisit the unconventional lease extension granted last month to the Bahia Resort Hotel.
The deal, given to influential hotelier Bill Evans and his family business, Evans Hotels, was hurried through the City Council during the final week of Mayor Jerry Sanders’ administration, skipping a committee hearing ostensibly so it could lock in a low interest rate.
Now, a San Diego chief deputy city attorney says the council needs to take another look at the agreement.
“In an abundance of caution, we are recommending the entire matter be re-heard by the City Council,” Leslie FitzGerald told Voice of San Diego Friday.
The agreement didn’t include an up-to-date statement of the property’s market value at the time of the lease extension, seemingly a violation of the city’s municipal code.
But FitzGerald isn’t ready to say the agreement is illegal.
“The agreement has been approved by the council,” she said. “We are recommending that they re-hear the matter.”
The City Attorney’s Office drafted the initial item approved by the council on Nov. 26. FitzGerald chalked up the lease’s re-examination to an “inadvertent omission in the resolution.”
The city attorney’s advice was triggered by a Dec. 14 letter from Cory Briggs of Briggs Law Corporation— to the city and Anne Evans, chairwoman of Evans Hotels, asking the city to “immediately cure its illegal approval of the 40-year lease agreement for the Bahia Resort Hotel.”
Briggs, as a legal representative for the nonprofit advocacy group San Diegans for Open Government, wrote:
“My client requests written confirmation of the lease agreement’s rescission no later than Jan. 15, 2013. If there is no rescission by that time, and if we do not otherwise resolve the matter or agree to an extension of this deadline by then, my client will sue to have the lease agreement invalidated.”
Briggs has pushed his deadline to Feb. 15 following the City Attorney’s Office decision.
How the council reacts to the city attorney’s advice will be the decision of Council President Todd Gloria, who controls the docket (with input from the mayor’s office and city staff).
FitzGerald said she’s working with city staff to schedule the item “at the earliest opportunity.”
The council could simply re-hear the item after it is re-written to include an assessment of the value of the 15 acres in the Bahia Resort’s lease. The council, which previously passed the agreement with a unanimous vote, would just need to approve the updated item.
Briggs, however, hopes the council will rescind its approval.
Then, the city could re-start the process of approving the agreement, possibly even subjecting it to the city’s normal legislative process, including a hearing before the Land Use and Housing Committee.
“I certainly hope they don’t do it as one item,” Briggs said. “That would suggest they’ve already made their decision. They have to approach it with this new information known, not decide they’re going to do it regardless of what the facts are.”
Bill Evans hadn’t learned of the potential legal issue with his lease extension when he was reached for comment late Friday afternoon.
“I’m guessing it’s going to make its way toward me whenever it does,” he said. “I’m not in any rush to understand it on a Friday afternoon. I’m convinced the city is good at crossing the T’s and dotting the I’s. It is what it is. … I suppose we’ll be dealing with it in the coming weeks.”
I’m Andrew Keatts, a reporter for Voice of San Diego. Please contact me if you’d like at firstname.lastname@example.org or 619.325.0529 and follow me on Twitter
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