Civic San Diego’s plan to act as a master developer in low-income neighborhoods is already dealing with a conflict of interest.

The agency, struggling to find a reason to exist years after redevelopment’s demise, was working to build a giant investment fund that would collect money from businesses, philanthropies and the government. The money would fund housing, parks and other amenities around transit stops.

Civic’s leaders felt it was key to the organization’s future.

But right out of the gate, the City Council budgeted $125,000 for a consultant (or two) who would both set up the investment fund and then manage it.

The fund — which officials thought might grow to $100 million and spin off hefty commissions to its managers — would be a joint effort between Civic San Diego and the San Diego Housing Commission, which handles affordable housing programs locally.

But the Housing Commission’s lawyers recognized there was a conflict of interest if a consultant both designed the fund and went on to manage it.

Now, officials say a simple reworked job description will make the conflict go away.

They’re rewriting the job requirements. Whomever is selected won’t be able to handle both tasks. Civic San Diego CEO and President Reese Jarrett said they’ll release the new description in the next two months and make a hire in six.

Two applicants had been brought in for interviews for the job to both set up and manage the new fund. Jarrett said the new job description will still allow them to compete — they just can’t do both tasks.

“We didn’t want to have those organizations precluded from being involved in the investment of the fund,” Jarrett said.

Civic won’t release the names of the applicants brought in for interviews, but says it will do so in a May 22 letter, once the initial selection process is officially closed.

Charles Modica from the independent budget analyst’s office — which initially made the conflict of interest public in its report on Civic’s new budget — said he was told the applicants brought in for interviews by Civic were representatives from “two large banks,” but didn’t know any other details.

Murtaza Baxamusa, a Civic San Diego board member who is suing the agency on grounds the city’s relationship with it is illegal, said this is evidence the board isn’t given enough information to provide adequate oversight of the agency.

“No one on the board even knew about it,” he said. “If the IBA didn’t mention it, we never would have known. What kind of oversight is that?”

Jarrett said he didn’t know why the issue wasn’t discovered until late in the hiring process, because he wasn’t with the organization when it wrote the request for applicants.

The transit investment fund is envisioned as a $50 million to $100 million pool of money culled from public and private sources, including banks, required to invest in low-income areas because of the federal Community Reinvestment Act, funds reserved for subsidized housing, and donations from large philanthropies like the Jacobs Foundation.

It would invest in projects that would build low-income housing and other community-serving amenities — parks, grocery stores — on both public and privately owned land near public transit options, like Encanto’s trolley station near the Jacobs Center.

Andrew Keatts

I'm Andrew Keatts, a managing editor for projects and investigations at Voice of San Diego. Please contact me if you'd like at

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