Former San Diego City Manager Jack McGrory Testified He Informed Gloria of “Great Deal for Taxpayers”
By Arturo Castanares – Editor-at-Large / La Prensa / Nov. 29, 2024
A statewide university official testified under oath that he briefed San Diego Mayor Todd Gloria twice in 2022 on details of an offer for a free-to-taxpayers sports arena but the Mayor instead kept moving forward on selecting a private developer who had donated more than $100,000 to his election campaign.
Jack McGrory, a member of the 25-person California State University Board of Trustees and former City Manager for the City of San Diego, is the first official to detail a 2021 proposal received from Denver-based Oak View Group (OVG) to fund and build a new sports arena within the SDSU’s Mission Valley campus.
The offer for a $425 million arena was similar to the deal that led to the successful development of the University of Texas at Austin’s Moody Center in 2021.
McGrory testified under oath that he spoke with Mayor Gloria and his Chief of Staff first after receiving the proposal and then again after McGrory and eight other San Diego leaders flew to Austin to tour the Moody Center.
The others on the trip included SDSU President Adela de la Torre; Adam Day, the Chief Administrative Officer for Sycuan who at the time was also a CSU Trustee; SDSU Athletic Director JD Wicker; Executive Associate Athletic Director Curt Apsey; SDSU Vice-President for University Relations and Development Adrienne Vargas; JMI Sports CEO Eric Judson, a consultant for SDSU; San Diego real estate developer Tom Sudberry; and businessman David Malcolm, a representative for SDSU donor Dianne Bashor who provided the chartered jet for the trip.
“It was a great deal for taxpayers,” McGrory testified during a legal deposition held in downtown San Diego last week. “[But Mayor Gloria] said he was serious about pursuing the Midway project,” McGrory added, referring to the City’s selection of a Gloria campaign donor Brad Termini to redevelop the existing sports arena site in the Midway area that will require hundreds of millions of dollars of taxpayer subsidies.
After Gloria ignored their proposal, SDSU officials and all of those involved kept the offer secret for nearly two years until La Prensa San Diego broke the story in March of this year.
McGrory testified as part of a lawsuit filed by La Prensa San Diego in May after the University system failed to disclose public documents related to the offer and trip taken by the group. La Prensa San Diego sued under the provisions of the California Public Records Act that requires the release of documents created by or sent to public agencies, including SDSU and the CSU system.
SDSU officials received a proposal for a $425 million sports arena development deal in December 2021 then organized the tour of the Moody Center in May 2022. McGrory said he agreed with others that the San Diego region could not support the development of two new arenas, so he says he contacted Gloria to inform him of the offer.
Page 1 of Oak View Groups’ four-page proposal to SDSU
Oak View Groups’ proposal highlighted that the company would invest the required capital with no cost or risk to SDSU through a long-term lease of the land within the SDSU West campus in Mission Valley.
In May 2022, the nine-person delegation flew to Austin in a private jet to tour the Moody Center and received a briefing from Oak View Group and UTA officials. McGrory testified that SDSU President Adela de la Torre and the others sat in on the presentation.
McGrory testified that he briefed Gloria and his Chief of Staff, Paola Avila, sometime in early 2022 then again after the trip to Austin in May 2022.
A January 6, 2022, email released through a California Public Records Act request shows a detailed summary of the proposal that was prepared for McGrory by Erik Judson, CEO of JMI Sports, a consulting company contracted by San Diego State University to negotiate sports deals.
Email from Erik Judson to Jack McGrory in preparation for briefing Mayor Gloria
The email subject is “Message Points for the Mayor” and outlines the details of the proposal, explaining that SDSU would be “embarking on a quick study to test the feasibility of an arena to make sure we can preserve our current development plans and secure entitlements” and if “the project is feasible, we will need [Gloria’s] support.”
Judson’s email also claimed that the “previous Mayor’s office declined to show leadership” when other offers had been received for sports arena developments, referring to former Mayor Kevin Faulconer.
McGrory testified that Gloria’s response to the free offer was to instead push for his own plan to select a developer to build a mixed-use project at the City-owned site of the current Sports Arena in the Midway area. At the time, McGrory did not know which developer the City would end up selecting.
Just a few months after that second briefing, Gloria pushed the City to select Brad Termini and his Midway Rising development team.
Even before the City Council meeting to select one of three finalists, City staff leaked that the Mayor’s office was pushing for Termini’s team even though he had never developed any project near the size of the Midway Riding proposal, and had never worked on a sports arena project.
Development experts argued that Termini’s proposal was unrealistic because the amount of construction wouldn’t even fit within the City’s 48-acre parcels.
Brad Termini
But Termini had become the largest personal donor to Gloria’s 2020 election campaign after he and his wife donated $100,000 to an independent expenditure committee set up to support Gloria.
Termini’s proposal included a 16,000-seat arena, 2,000 low-income affordable apartment units, 250 middle-income units, 2,000 market-rate units, a 200-room unionized hotel, commercial and retail spaces, and 4,500 vehicle parking spots.
During the City Council committee meeting to select a developer, the region’s most powerful labor union leader testified in favor of Termini’s proposal, saying his project would leave more permanent union jobs through its 200-room hotel.
Brigette Browning, the President of the local hotel workers union and also the leader of the region’s Labor Council, however failed to file required federal Department to Labor disclosure forms stating that her husband, Dan Rottenstreich, had been paid more than $200,000 as a consultant for Termini’s project.
Browning also directly lobbied Gloria and City Council members in support of Termini’s project. Browning’s San Diego-Imperial Counties Labor Council has endorsed all nine City Council members in their elections.
Brigette Browning
Termini’s team also failed to disclose Rottenstriech’s involvement until months after the City Council voted to select his team. The San Diego Ethics Commission fined Termini’s group $5,000 for failing to disclose his involvement in a timely manner but did not invalidate the Council’s action to select Termini’s team.
Dan Rottenstreich
But months after being selected, Termini scratched the 200-room unionized hotel and the 250 middle-income units from his proposal, yet Browning did not protest the elimination of hundreds of jobs for her union members.
Last year, Termini’s team began negotiating with the City to receive tens of millions of dollars of taxpayer-funded bond subsidies through tax increment financing. Termini admitted that his project is “not financially feasible without getting some of the infrastructure paid for” by the City.
This September, Termini’s team asked the City to extend the deadline for them to reach a final development deal, with the City Council voting to delay their approval for another year.
La Prensa San Diego’s lawsuit continues to move forward with additional depositions and discovery to determine what other documents were improperly withheld from disclosure.
Rottenstreich, Heather Ferbert’s campaign mgr. and soon to be city attorney.
Interesting SDSU pushing for a bridge from Fenton Pkwy over the SD river to Camino Del Rio N.
The State Attorney General needs to be informed of the facts in this case. I hesitate to state the City Attorney be informed because it is clear from the La Prensa news articles that the City Attorney was fully informed and declined to act. The facts suggest to me the City of San Diego lost a $426,000,000 donation simply because Mayor Todd Gloria failed to disclose of personal conflict of interest. This is criminal, if those facts prove to be true.
The city missed out on no such “donation”.
This is malfeasance in office and grounds for a recall of Gloria.
Here again! we have additional EVIDENCE/FACTS about the corrupt habits of Todd Gloria! I trust that our District Attorney & our State Attorney are informed & investigating in order to initiate indictments.
Then to add insult to injury, we learn after the fact that civic minded McGrory said nothing until he was compelled in Court testimony.
Why did Adela de la Torre not speak up at the time – indeed call a
Press conference? Was anyone on the City Council aware of the SDSU
proposal? Lamentable the level of corruption in our City!
Does anyone remember that when the U-T endorsed Gloria this time around, they claimed there were no grounds for any charges of corruption? I hope so. It wasn’t that long ago.
“civic minded McGrory?’ That is an oxymoron for sure.
Frank, we all remember the Union-Tribune corruptly endorsed Todd Gloria and were aghast that people stupidly voted to re-elect Todd gloria in spite of the damage he has wreaked upon the City of San Diego. Will we have to hire a law firm to induce the State Attorney General to visit San Diego and the Halls of Corruption?
Good question – at least you’re optimistic.
As per usual, La Prensa continues its wild goose chase. They are far more concerned with stopping the construction of affordable housing that they are this supposed “corruption”.
Gloria is not in charge of SDSU, the city does not own the mission valley site. It has become increasingly obvious that SDSU never seriously considered OVGs offer, because they already have a good arena that they have no intention on replacing.
Your comments invite comments and questions. Your first statement is bullpucky. Second, who owned the Mission Valley sports stadium property, if the city didn’t? And what “good arena” wasn’t replaced? Is there a new stadium there or not in Mission Valley owned by SDSU?
The Mission Valley property is, right now, owned by San Diego State University. It was sold to them back in 2020 so that the school could build the stadium and develop the parcel. The hypothetical arena that is being brought up by La Prensa was a “free” replacement to Viejas Arena. SDSU appears to have had no intention on getting a new basketball arena, especially when part of what OVG wanted in return was all the revenue the site would generate, all but erasing any money they currently get from Viejas Arena.
Gloria never gave the proposal any weight for two very big and very obvious reasons that I doubt OB Rag and La Prensa are interested in telling you. For one, it simply was never Gloria’s decision to make, and entirely up to the university. For two, the presence of a new arena on the Mission Valley Campus, even if it managed to attract the tenants of Pechanga Arena, would have had 0 influence on Gloria’s decision to go with Midway Rising.
Midway Rising was not picked because of it’s arena, it was picked because the developers promised 4,000+ units of housing, 2,000 of which are legally required to be affordable housing. Gloria had no choice but to go with this because of state law.
Wrong, Midway Rising was picked because one of the principals was the largest campaign donor to Gloria’s mayoral run. Brad Termini and spouse.
Again, it would have been illegal under state law to pick any of the other bids because the city is required *by law* to pick the one with the most affordable housing.
You’re really putting the cart before the horse. Termini made the donation before Gloria made the decision.
You’re deliberately misreading what I am saying. Gloria was *legally required* to pick the bid with the most affordable housing.
Are you suggesting that Gloria instead should have illegally selected a different bid?
Because that would have been the very corruption you claim to be fighting.
Sure, put words in my mouth and then slam me for them. Gloria did not have to pick Midway Rising; he could have arranged some kind of deal involving the “free” arena in Mission Valley. If you look back over the record, Gloria was really focused on getting a new arena at Midway — affordable housing was just positive collateral. He didn’t have to — and didn’t go with the developer Faulconer had chosen. Go ahead, defend Gloria — just be up front about it.
So, Gloria ignored the freebie to ensure there was something he could dangle in front of his monied supporters. If Termini had not donated all that he did, Gloria may have lost the election. It was payback time. There was in the end nothing he could throw back at his donor elite from the Mission Valley scenario. The rest is history.
Gloria was quite literally legally required to pick the Midway Rising deal, because it offered the most housing. That is literally how the Surplus Land Act works, and Kevin not doing this is why Gloria had to restart the bidding in the first place.
Todd could not have “arranged some kind of deal” the “Free Arena” because it was proposed to be on San Diego State University’s land. The deal was never offered to the city itself, it was never an option that was Gloria’s to choos.e
So, Gloria ignored the completely unrelated proposal which the city had not say in. He focused on the Midway site which the city did have say in. State law required that the city must select the bid with the most affordable housing, and that’s what Gloria did.
To be clear, as far as the city’s jurisdiction applies, there is no “Mission Valley Scenario”
Have you examined all of the proposals for the Midway development, including the ones deemed “non-responsive,” and compared the total numbers of affordable housing from each one?
Yes, I followed the bid process closely. Midway Rising had by far the most
2000 units the developer can’t build without an EIFD. That lack of ability alone should have any bid thrown out as unqualified.
It has yet to be determined whether or not the EIFD will go into funding the infrastructure around the area or into the housing itself, however there is no reason why that should be disqualifying.
The Midway Rising team has promised to build 2,000 affordable housing units,
“This project is not financially feasible without getting some of the infrastructure paid for,” Brad Termini, the CEO of Zephyr.
McGrory maintains that Gloria told him not to pursue the deal in Mission Valley because he was moving forward to redevelop the existing Sports Arena site into a new mixed-use project with affordable housing and a new, 16,000-seat sports arena.
Just a few months later, Gloria pushed City staff to select developer Brad Termini and his Midway Rising group to enter into exclusive negotiations over two other competing development teams. City staff had complained they were not allowed to properly vet Termini’s proposal because the Mayor’s office had already decided which team to pick.
Then what if the other groups didn’t need an EIFD?
The major changes in their proposal, because of an unexpected underground utility that was well known to be there, should have been grounds enough to disqualify their proposal. All my years in dealing with construction contracting told me this was seriously wrong. Why the other proposers did not put up a stink is beyond me.
McGrory and eight other San Diego leaders flew to Austin to tour the Moody Center.
So the question is why?
“It was a great deal for taxpayers,” McGrory testified
Do you dispute the testimony? You seem so animated.
Viejas is 27 years old. Mission Valley would be an excellent site for a free arena (considering SDSU is pushing for a bridge from Fenton Pkwy to Camino Del Rio N.) due to its location. Valuable campus space could be freed up. Traffic congestion would be less at SDSU and the Midway area.
SDSU is not run by the city of San Diego. SDSU clearly did not care for what was on offer, probably because it meant losing of on gameday revenue.
The testimony is a nothing burger. It does not substantiate either that SDSU incorrectly decides against the idea, nor does it prove that the offer had anything to do with what’s going on in the Midway district. As I stated in my original comment: La Prensa is on a wild goose chase.
> Considering SDSU is pushing for a bridge from Fenton Pkwy to Camino Del Rio N.
I’m pretty sure that was literally part of their deal for buying the Mission Valley Site back in 2020.
> Valuable campus space could be freed up.
OVG quite literally wants to take up far more valuable campus space for this arena. It’s fair easier to build apartments at the mission valley site than on the Mesa. Largely on account for the fact that Viejas is located in the old Aztec Bowl.
> Traffic congestion would be less at SDSU and the Midway area.
Viejas Arena is already located within short distance of SDSU’s trolley station. Traffic is already a non-factor for them comparatively speaking.
In summary, SDSU has little to gain from OVG’s proposal. It loses out on event revenue, on a prime location for student housing, all for an arena they won’t see a profit from for over a decade.
SDSU didn’t want the proposal, therefore Gloria had even less of a reason to look into it than he already did.
The funniest thing is this arena is as “free” as the proposed Midway arena is. An EIFD isn’t a “tax subsidy”, it’s literally about taking excess tax revenue generated by the district and reinvesting it into the areas infrastructure
Probably meant losing revenue. Supposition.
Sworn deposition testimony a nothingburger. The offer establishes a piece of timeline and people involved.
Easier to build apartments at Mission Valley? There’s 10 years of projects in the pipeline for 4500 more high rise beds on 55th and also Montezuma. I am very aware of SDSU’s expansion at campus. Meanwhile Mission Valley sits for 4 years now only producing Snapdragon.
Viejas Arena is already located within short distance of SDSU’s trolley station. And a Mission Valley arena is near that trolley station. So what. Living in the area, I am keenly aware of traffic impacts by Viejas. Throwing dung at the wall isn’t sticking for you.
Probably meant losing revenue is the logical conclusion when OVG literally says that event revenue goes to them as part of the deal for getting the arena for “free”
> Sworn deposition testimony a nothingburger. The offer establishes a piece of timeline and people involved.
It establishes nothing of value. All we learned is that Todd Gloria was aware of a development that he had no say in as mayor of the city.
> Easier to build apartments at Mission Valley? There’s 10 years of projects in the pipeline for 4500 more high rise beds on 55th and also Montezuma. I am very aware of SDSU’s expansion at campus. Meanwhile Mission Valley sits for 4 years now only producing Snapdragon.
This is the kind of thing that someone who has never seen Viejas Arena before would say. It’s literally built into a old football stadium built into a canyon. Mission Valley is flat land. It’s so obvious that I am beginning to wonder if you’re just arguing to argue.
> Viejas Arena is already located within short distance of SDSU’s trolley station. And a Mission Valley arena is near that trolley station. So what. Living in the area, I am keenly aware of traffic impacts by Viejas. Throwing dung at the wall isn’t sticking for you.
The “So What” is that the traffic argument you just made is just throwing dung at the wall.
> Easier to build apartments at Mission Valley? There’s 10 years of projects in the pipeline for 4500 more high rise beds on 55th and also Montezuma. I am very aware of SDSU’s expansion at campus. Meanwhile Mission Valley sits for 4 years now only producing Snapdragon.
This is the kind of thing that someone who has never seen Viejas Arena before would say. It’s literally built into a old football stadium built into a canyon. Mission Valley is flat land. It’s so obvious that I am beginning to wonder if you’re just arguing to argue.
Hardly when I’m very close to the arena and the dorm projects are on the SDSU website. Structurally you could change Viejas much the same as to what was built at Storm Hall West on the hillside. Who really is arguing to argue?
Outsiders to this 2-way argument are losing track of who’s saying what — very confusing and difficult to follow. Could Chris S and Robert summarize their positions once and for all and be done with it? Please, or comments to this post will be cut off.
So, if what you say is true, why didn’t it come out in McGrory’s deposition that way? McGrory is many reprehensible things but he is not stupid, I doubt he would lie in a deposition.
Because I suspect all that was asked of McGregory was whether or not he shared this with Todd. I’m not accusing him of lying, I am accusing his testimony of being a nothing-burger.
Think about it, what did we even learn here: We learned that Todd Gloria was made aware of OVG offering a “free arena” to SDSU and Todd proceeded to do nothing with that information. This makes sense, SDSU is not run by the city.
And the farce is SDSU blocked McGrory from testifying and had to be sued for public records relating to the free arena.
I don’t believe SDSU blocked McGrory from testifying, Chris. The most serious matter is SDSU being in violation for the Public Records Act. Seems to me there should be some kind of penalty for breaking state law.
Maybe Art can clear this up then
https://laprensa.org/sdsu-blocks-mcgrory-testifying-under-oath
You don’t think that “McGrory” would have said that it was SDSU that didn’t want the deal if that was the case? Why would he say, as you are interpreting it, that the mayor turned it down? Wouldn’t a person with McGrory’s deep experience in city government know whether or not that mayor had any say in this?
“It’s fair easier to build apartments at the mission valley site than on the Mesa. Largely on account for the fact that Viejas is located in the old Aztec Bowl.” What, pray tell, does that mean?
“An EIFD isn’t a “tax subsidy”, it’s literally about taking excess tax revenue generated by the district and reinvesting it into the areas infrastructure.”
Please explain “excess tax revenue” for us all here.
I wonder which of the Native American tribes has put a CURSE on San Diego and it’s sports teams..??
With all of the people (great minds?) we’ve had and all of the projects that have been proposed, delayed, bungled, or otherwise passed over, one would think we just MIGHT get something done without a COLOSSAL CLUSTER….***K!!
I would like to point out that the affordable housing is dependent on (will be financed using) the highly competitive Low Income Housing Tax Credits (LIHTC). This means other affordable housing projects will not get built. It’s a zero-sum game. We have a robust sector of affordable housing developers whose projects will not get built or will be delayed because of this project. The lack of $$$ for affordable housing is described well in this CalMatters article from December 22, 2023: http://calmatters.org/housing/2023/12/affordablehousing-california-2/.