Three county tax liens have been lodged against Katherine Stuart, wife of GOP San Diego city councilman Kevin Faulconer, who is currently running for reelection and said to be eager to succeed Mayor Jerry Sanders when his term runs out in two years. In addition to Stuart, the liens, totaling $18,120, also name Jerry Dressel and Spa Tiki, a limited partnership that Stuart formerly had an interest in.
Until it abruptly closed last fall, Spa Tiki was a high-end beauty business offering manicures and massages on the ground floor of One Harbor Drive, a high-rise condo and retail complex opposite the City-subsidized San Diego Convention Center. According to an April 2008 financial disclosure filed by Faulconer, Stuart sold her share of Spa Tiki for between $1000 and $10,000 on December 31, 2007. Dressel was the buyer.
At that time, Stuart’s portion of the business’s gross income was said to be between $10,000 and $100,000. In an interview last week, Leo Sullivan, Stuart’s attorney, said she had received the tax bills — covering 2005, 2006, and 2009 — just two weeks ago in a registered letter sent by the county. “She was always a limited partner and wasn’t aware of the bills until last Saturday,” he said. “It struck me as odd. It’s been over two years since Katherine had any interest in the business.” He added that he was monitoring the situation and would attempt to have the county remove Stuart’s name from the bills. “I think the assessor will make the correction.”
Back in February 2006, City Ethics Commission chief Stacey Fulhorst cautioned Faulconer that Stuart’s investments in Spa Tiki and another downtown business posed a potential conflict of interest for him. “Your spouse’s ownership of Restaurant Events and Spa Tiki constitutes economic interests for you that must be considered when these business entities are directly or indirectly involved in municipal decisions,” Fulhorst wrote. That March the Union-Tribune reported that Faulconer was amending his previous financial disclosures to resolve conflicts between his prior filings and information provided by Stuart regarding her business income.
Stuart, 42, was a sales representative for the now-defunct Planet Hollywood restaurant in Horton Plaza before she started Restaurant Events, which markets Gaslamp Quarter eateries to convention planners. Clients have included the On Broadway Event Center, Dick’s Last Resort, and the Cohn Restaurant Group. Faulconer’s most recent financial disclosure statement, dated this March 9, puts a value on Restaurant Events at between $100,000 and $1 million, with gross income in 2008 of over $100,000. Cohn Restaurant Group contributed at least $10,000 of that, the filing says.
Dressel, a past president of the San Diego State University Alumni Association, has been involved in other local businesses, including Zero Downtime, an internet service provider. Court records show that Spa Tiki’s landlord, One Harbor LLC, filed an eviction suit against the partnership on August 26 of last year, claiming $23,798 in back rent. The property was vacated on October 13, according to the documents. Shortly after the eviction case was filed, Spa Tiki sued One Harbor and its property manager, alleging that Spa Tiki had been overcharged $200,000 in certain fees related to parking. Dressel confirmed that the partnership dropped that matter in January.