Downtown Partnership denied taxpayer money to fight lawsuit

Litigation is, misuse of taxpayer money

Jerry Sanders, Downtown Partnership CEO Kris Michell, Kevin Faulconer
  • Jerry Sanders, Downtown Partnership CEO Kris Michell, Kevin Faulconer

The Downtown San Diego Partnership won't be able to dip into taxpayer funds to help pay for legal help needed to fight a lawsuit over mismanagement of the $5.5 million in annual revenues collected under the Property and Business Improvement District (PBID).

An October 11 email from Luis Ojeda, the person in charge of overseeing assessment districts for the city, denied the partnership's request to pay for legal fees using money collected as part of the Downtown PBID.

"We are deducting $5,000 from July 2013 request and $1,882.50 from August 2013 request (both for legal fees). Based on legal advice we received, all subsequent legal fees regarding [the] San Diegans for Open Government [case]...will not be reimbursed at this time," read the email from Ojeda, which the Reader obtained through a California Public Records Act request.

News of the rejection came one month after a September meeting at which PBID advisory board members approved setting aside $100,000 to hire Colantuono and Levin, a specialty law firm headquartered in Sacramento. (The same lawyers were hired to file suit against former mayor Bob Filner in an attempt to force the release of Tourism Marketing District dollars.)

The suit from watchdog group San Diegans for Open Government was filed in August of this year and accuses the partnership of having free rein to spend money collected from property owners in the five downtown neighborhoods that make up the downtown PBID.

Critics of the private/non-profit organization claim head of the partnership (and former chief of staff for Jerry Sanders), Kris Michell, and the board of directors have had an open mind when interpreting the law governing assessment districts. That interpretation has allowed them to open the checkbook for goals such as ridding downtown streets of panhandlers, preventing public urination, or any other issue said to "detract from the business being conducted" in San Diego's downtown neighborhoods.

The partnership has also directed taxpayer revenues to pay for the organization's new business plan, the Downtown Partnership's new logo, and their fresh new website.

The next hearing is set for November 22 with superior court judge Ronald Styn.

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Man these people have cojones! Mis-manage,(lose,steal,appropriate for pay raises) five and a half million dollars and ask us to pick up the tab after being sued? The question is begging to be asked. How much money do we give the Downtown Business Partership?

"will not be reimbursed at this time" [italics added] Even though it will be a violation of State law, the DT SD Partnership will eventually get the property owners' tax-bill special assessment money, after Goldsmith and Carmen Brock do their dodging and hedging and there is some sort of agreement by Briggs to withdraw the suit.

FatCat: Of the collected total county 2013 property tax revenue ($3,821,244,316), 3.4% is collected as special assessments in neighborhood MADs and the downtown PBID. That money is turned over by the county to the city, to distribute to the administrative boards of the MADs and the PBID (for the PBID, the admin is the Downtown San Diego Partnership). Much of the collected property assessments distributed to these boards goes not for real and special services to property owners, as the law specifies, but for admin stuff and anything the boards want to spend it on, with very little oversight. It takes a lawsuit to stop improper use and reimbursement of the assessment dollars. Ojeda will return to giving the boards money for just about anything they want as soon as the spotlight is dimmed.

In 2013, only 0.7% of the property tax revenues is destined to go to libraries. Wouldn't if be wonderful if the city promoted property-based special taxes on everyone in the county in order to fund libraries' needs (see Reader article on library patio)? If only the city would undertake equal PR efforts to support causes other than privatized special assessment districts, we'd have a much finer city.

THANK YOU Luis Ojeda Person in charge of overseeing assessment districts for the city.

HonestGovernment's point about Goldsmith and Briggs deal cutting is scary. Seems those two have become cozy since the Filner gangbang and Briggs' offer the City settle with McCormack using monies owed him. Guess over 15 cases against the City and lawyers get friendly with constant interaction. This constant transfer of taxpayer wealth to the Briggs law firm is getting old when we're $2 billion underfunded for infrastructure and basic City services.

Glad Downtown Partnership was sued and ultimately hope they lose as a wake up call. Just disappointed who is providing legal representation for SDOG.

Downtown always wins because this crap is too complicated for average folks to keep up with or understand. Someday we'll get a story that shows in aggregate how much the City pays annually to settle and payout lost lawsuits. And maybe then people will wake up.

I wonder what kind of salary CEO Kris Michell is pulling in?

DwBat, I am not sure of the number and it might be difficult to find out. If my memory serves me correctly, since the SDDP is a private/non-profit she does not have to post her salary. The PBID is only one part of the Partnership. I might be wrong on this. I'll find out for sure and get back to you!-dH

Dorian, For the most recent filing, FY ending 6/30/2012, the 990 form for DTSDP (EIN 951729734) shows that the nonprofit's president, Kris Michell, was paid $187,586 ($12,000 of that was a bonus). Four other employees made from ~$57K to $103K per year.

DTSDP's total revenue was $6,307,459 (PBID plus membership fees and a cut of the city's parking meter revenue, plus fees collected on business owners and for banners, plus almost half a mil for selling transit passes). The downtown property owners' assessments (PBID) comprised $5,089,699 of the revenue; without collecting those monies from property owners, Michell's group would be small potatoes. In the 990 filing, justification for being allowed to claim tax exemption must be stated: the PBID seems to be the only raison d'être.

I stand corrected. Thanks, HG. I can always count on you for some serious fact checking!-dH

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