A former Residence Inn in Mission Valley / Photo by Adriana Heldiz

Voice of San Diego revealed earlier this year that a broker working with the San Diego Housing Commission made a significant financial investment in the company that owned one of the hotels he helped the agency acquire to convert into low-income housing. He invested in the company before the Housing Commission negotiated the final deal.  

The city has since accused the broker of making fraudulent misrepresentations and violating state law.

But now that conflict-of-interest case has ignited its own conflict behind closed doors at the city. The fight has revealed a significant lack of trust between the city attorney and Housing Commission and others. 

Andrew Keatts reports that staff at the agency, its board and elected officials have been at odds over how to handle the revelation. Among other things, attorneys got into an argument last month over who ultimately signed off on the deal and who held the responsibility to ensure it wasn’t tainted.

The dispute over disclosure and due diligence is taking place as the City Council considers reforms to the Housing Commission. Its CEO acknowledged the conflict-of-interest case has exposed holes in the city’s arrangement with the Housing Commission.

Click here to read the full story.

The more you know: The Housing Commission is an independent agency with its own counsel and board, but it gets legal advice from the city attorney and answers questions posed by the nine members of the City Council when they convene as the city’s Housing Authority. 

Over the summer, the City Council asked the city’s independent budget analyst to review other arrangements in the state, which could serve as a basis for changes in the future. 

San Diego Sound and Fury

Last week was not a good one for Kevin Faulconer and for California Republicans. The former San Diego mayor finished third in his first statewide contest with less than 10 percent of the vote, despite wishful-thinking that he was the future of the GOP. Instead, conservatives gave their votes overwhelmingly to a provocative radio host from Los Angeles who’s never held office. 

After Faulconer’s loss, it’s hard to see how the old San Diego Republican, pro-business playbook has any life left in it, write Keatts and Scott Lewis in the Politics Report this weekend. 

They also explain what a pair of new housing bills — signed by Gov. Gavin Newsom after he successfully fought off the recall — means for San Diego. But if you want to read the Politics Report, you gotta become a member. 

More politics: The 101 Ash St. dumpster fire just got hotter. On the podcast, our hosts talk about the city’s volunteer real estate adviser who’s now at the center of the ongoing controversy over a downtown building that’s sat vacant for a long time. Though he was portrayed as a volunteer, he walked away from a pair of real estate deals with more than $9 million after striking an agreement that entitled him to 45 percent of the profits, as Lisa Halverstadt reported. 

Lewis and Keatts also talked about police reluctance to take the COVID-19 vaccine and that delightful story about San Diego hotelier Bill Evans lurking, uh, incognito, among reporters at the fraud trial of Elizabeth Holmes.

Listen to the podcast here.

In Other News

  • Police are investigating the severe beating of a gay man in Barrio Logan as a hate crime. (NBC 7 San Diego)
  • For Union-Tribune subscribers, the paper has a long, emotional story about a woman who struggled to understand why her son had dozens of seizures a day and the doctors and entrepreneurs who joined with her to try to treat rare diseases like his. A lot stands in their way, but it’s a well told story.
  • An initiative likely headed for the 2022 ballot would legalize sports betting in California and Del Mar Fairgrounds is on it. (Union-Tribune)
  • For years, land the Metropolitan Transit System owns near trolley and public transit stops has been seen as low-hanging fruit for housing needs. It’s where MTS wants housing and the agency controls the land. Parking lots especially should give way to homes, the theory is. But a plan in Barrio Logan to do just that has been delayed because of parking concerns. (KPBS)

The Morning Report was written by Jesse Marx and edited by Scott Lewis.

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