Redevelopment Reconsidered as Civic San Diego Fades

by on April 2, 2019 · 0 comments

in San Diego

By Doug Porter / Words & Deeds / April 2, 2019

It’s taken more than seven years, but seeds planted by former San Diego Mayor Bob Filner have borne fruit. The inclusion of an outsider or two in the oversight of redevelopment ultimately led to the end of a process that claimed to be helping the many when in fact, they were little more than a rubber stamp for the interests of a few.

The era of farming out authority and oversight to autonomous agencies, based in large part on the presumption government should be run like a business, is ending, I hope. Going forward, the hope is for a process including consideration of the interests and concerns of the community and the planet.

Bottom line: The City of San Diego and Civic San Diego are no longer joined at the hip as the result of a pending court settlement. The ultimate authority for decisions relating to development is now with elected officials, rather than land use lawyers and real estate moguls.

While there’s no guarantee the new overlords will be any better than the old ones, at least we will have an opportunity to turn them out should they misbehave.

A little history is in order to understand the significance of this change, brought about thanks to the settlement of a lawsuit filed by former Civic board member Murtaza Baxamusa with the support of the San Diego Building & Construction Trades Council.

The creation of redevelopment agencies was based on the premise they would be an effective vehicle for upgrading blighted areas, funded by increases in property values.

Abuses were rampant, like Coronado’s decision to declare the entire city blighted. Although not all agencies operated in the same way, all-too-often the funding mechanism was a way to siphon off tax dollars away from the prying eyes of elected officials.

Civic San Diego was born from the ashes of the Centre City Development Corporation (CCDC) and the Southeastern Economic Development 2012 following Gov. Brown’s decision in the wake of court rulings to dissolve the roughly 400 redevelopment agencies throughout the state.

In San Diego, a common perception was of CCDC as a tool of the old-boys network, a de facto bank account to stockpile and tap funds as needed. To its credit, the agency was instrumental in creating many of the facets of what most would agree is a happening downtown these days.

However, there were state-mandated rules for how the development game was to be played. And the CCDC did not fare well compared to other agencies around the state when it came to creating meaningful employment opportunities.

A 2009 performance audit, triggered by a conflict of interest scandal, concluded:

“There appears to be little disagreement that CCDC has met and often exceeded expectations related to facilitating infrastructure improvements in the Centre City and Horton Plaza project areas. However, it does not appear that CCDC has promoted economic development or social service delivery to the extent that CCDC’s peers have — this represents one of the most cited concerns by community stakeholder groups, which at times expressed criticisms that CCDC is primarily orientated to facilitate development and thus, caters to developers.”

The creation of Civic San Diego didn’t appear to be much more than a shuffling of the deck. We ended up as the only city in California outsourcing permitting and planning functions to a nonprofit with minimal oversight. And it was the only city-related agency not requiring subsidized projects to pay a living wage to their workers.

Assemblymember Lorena Gonzalez introduced legislation (ultimately vetoed by Gov. Brown) allowing for the possibility of appeal to the city council on major projects (+25,000 sq feet). The howling hyenas of uncertainty circled round, claiming even quaint outdoor cafes would get caught up in a never ending permitting process.

A representative of the mayor’s office suggested the prospect of an appeals process could put basic city services at risk, saying it “will hurt communities who deserve park improvements, fire and police upgrades and much-needed economic development.”

The way Civic San Diego wanted it to be was “our way or the highway,” citizens be damned.

Murtaza Baxamusa filed suit in 2015, claiming the city violated state law and the city charter when, in 2012, it created Civic San Diego and delegated to it the city’s power to approve and plan development projects downtown.

For months prior to the filing of the lawsuit, a coalition of community and labor groups argued any project receiving public tax credits should be subject to a community-benefits policy to guide development.

The attempt at discourse fell on deaf ears, and the San Diego Building & Construction Trades Council agreed to financially support Baxamusa’s legal offensive.

Over the past seven years, Civic San Diego handled almost all of the permits for new residential towers, hotels and office buildings in the downtown region, providing an expedited system for approvals. While this may have been great for developers, the organization’s insular nature created circumstances ripe for abuse..

A whistleblower lawsuit filed in 2017 made claims of abuses of authority and misuse of the organization’s resources by then-president Reese Jarrett.

From the Union-Tribune:

The suit also accuses Jarrett of conducting Civic San Diego business burdened by conflicts of interest such as “engaging in sole-source contracts and other instances of nepotism and favoritism; and by controlling and directing CivicSD projects to benefit his friends, family and even his own church.”

Jarrett abruptly resigned in February, 2018, telling reporters he wasn’t convinced his position would exist moving forward.

The settlement announced last week–which still has to be approved by the council– says Civic San Diego has agreed to cease its planning and permitting of downtown projects, along with ending administration of the downtown parking district. Those functions will be transferred back to the city.

Civic San Diego will continue to exist, becoming more of an economic development agency, overseeing the wind-down of the former redevelopment agency and running community investment programs. It is also still eligible to receive New Markets Tax Credit allocations, which are special tax credits awarded annually by the federal government.

From Voice of San Diego:

Eight staffers who now work on planning and parking district oversight at Civic San Diego may have an opportunity to apply for jobs at City Hall. Caldwell said the mayor and City Council will hash out next steps in coming weeks as the city finalizes its budget for next year.

And 30 days after the City Council votes to approve the settlement – a vote that is not yet scheduled – city officials said developers with new projects will instead bring them to City Hall.

Since its reincarnation as Civic San Diego, the downtown agency has been attempting to diversify the ways it spurs redevelopment in the city. Now those new avenues will be more crucial than ever.

There remain unresolved issues with the agency’s past financials, along with the embarrassing $6.7 million New Markets Tax Credit Program invested with the now-shuttered Thrive Public Schools for its Linda Vista property.

The City Council will have to pay close attention as future projects present themselves to insure they benefit the entire community. There are a lot of naysayers out there waiting for the opportunity to undo what is a victory for transparency and good governance.

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