In its June 2, 2008, report CCDC: WHAT DOES IT DEVELOP AND WITH WHOSE MONEY?, the San Diego County Grand Jury recommends that both the functions of the Centre City Development Corporation (CCDC) and the Southeastern Economic Development Coporation (SEDC) be combined into a single Redevelopment Agency for the City of San Diego.
The recomendation came just as the presidents of both CCDC and SEDC were resigning or unanimously removed with three month to clear the office and generous severance pay.
An earlier story in this city's daily paper described Councilman Kevin Faulconer's desire to have the Grand Jury's recommendations brought for discussion at a City Council meeting. That article quotes Faulconer regarding CCDC's fate: “All options should be on the table. I appreciate the grand jury's position and think it's one we ought to consider.”
The Grand Jury began its investigation of CCDC on receiving "four citizen complaints regarding the lack of audits and oversight for projects of the Centre City Development Corporation (CCDC) and alleged misrepresentations by CCDC of its activities..." The investigation also explored the self-declared role of the City Council as the City of San Diego Redevelopment Agency (so that councilmembers are responsible as the nominal directors of the City of San Diego Redevelopment Agency), providing the bureaucratic context for the inquiries into CCDC's activities.
Among the Grand Jury facts and findings:
The City of San Diego Redevelopment Agency is currently out of compliance with its state-mandated "independent financial audit" requirement for Fiscal Years 2005, 2006 and 2007. According to the Grand Jury, "The lack of current audited financial statements opens the Redevelopment Agency to law suits and fines and hinders public oversight of revenues collected and expended, indebtedness and allocations for low and moderate income housing."
"The Redevelopment Agency owes the City approximately $250 million in loan repayments... [with] no timetable for repayment of these loans to the City."
CCDC misrepresentation "has sometimes misled the public and the media as to the true role of CCDC as an agent, planner and project manager for the Redevelopment Agency."
Among the Grand Jury recommendations to the Redevelopment Agency (San Diego City Council), cited in full:
08-116: Establish a dollar threshold over which any sole source contract, especially for consultant services and legal services, would have to come before the Agency for justification and approval.
08-117: Take steps to insure the timely submission of the Fiscal Year 2007/2008 Redevelopment Agency Annual Financial Report, and all such future reports, to the Office of the State Controller as required by law.
08-118: Direct staff of the three component entities of the Redevelopment Agency to compile a grid, broken down by project area, which would list all monies owed to the City of San Diego, the date the debt was incurred, the fund from which the monies were borrowed and a realistic timetable for repayment
08-119: Identify the true funding mechanism for every approved project at the time of approval.
08-120: Notify the Centre City Development Corporation to identify the true funding mechanism for every project it publicizes or in which it is otherwise involved.
08-121: Direct City Redevelopment Division staff now working on reorganizing the City’s component of the Redevelopment Agency to take the additional step of preparing a plan to consolidate all three existing components under one administrative structure.
Since the Grand Jury report in June, CCDC has dropped the planned development at 7th and Market (see the blog by Don Bauder, "CCDC Kills 7th and Market Project...").
It should seem that as identified redevelopment heads, the members of our City Council should adopt the Grand Jury recommendations for greater CCDC and SEDC oversight as soon as possible.
As for the $250 million or so still outstanding, and without that "grid" of what loans compose that outstanding amount, we once again have a situation where our City Council fails to have a handle on the finances of the City. It wasn't that long ago that there was no comprehensive listing of city assets or contracts... with respect to the redevelopment loans, that list still does not exist.
Recommendation 08-116 is a specific call to the City Council to maintain contract oversight that should be extended over all redevelopment activities. Compare this with Keyser Marston's report of outgoing SEDC president's call for that organization to shed its contract monitoring and enforcement functions in 2006, and this year's June 25 SEDC board minutes after the Grand Jury report, where SEDC noted Ms. Smith's interview treatment of a formally-submitted lot usage proposal: "it is unusual for respondents to revise proposals after they are submitted and particularly during the interview phase." (See Encanto Gas Holder blog "SEDC president to board in 2006: give up affordable housing monitoring and enforcement?")
Recommendation 08-117 is a no-brainer. As the Redevelopment Agency, the City Council must implement this state financial reporting requirement now and forever, or the councilmembers should just resign. We don't need the further liability that inaction is causing (or costing) us now.
The remaining recommendations speak for themselves.