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Monday, Jul 22, 2024

Ballpark City opts to re-vote ballpark issues

Best-Case Scenario: Bonds May Be Issued in Six Months

Attempting to eliminate any possible taint related to former city councilwoman Valerie Stallings’ plea bargain and resignation, the San Diego City Council is scheduled to take another vote on the Padres ballpark plan.

While the City Attorney’s Office said such an action is not required, it advised the now-seven-member body , five of whom are new to their jobs , that a re-vote on ballpark-related contracts and agreements is the best way to proceed.

“We don’t believe this is required at all, but in the abundance of caution, we’re recommending they do this,” said Assistant City Attorney Les Girard.

The planned action on a combined package of 15 to 20 contracts includes such agreements as the design-build contract for the 46,000-seat Downtown ballpark. Girard said he wasn’t certain the agreements would include a March 1999 resolution of finding “sufficient assurances” that both the city and Padres should continue their partnership in building the ballpark. The vote is scheduled for Tuesday.

Mayor Dick Murphy said Stallings’ resignation last week removes a big obstacle from the legal thicket that caused the ballpark project to be put on hold in October. However, Murphy, a former judge, and the rest of the council are well aware of existing litigation challenging the ballpark that prevents the city from issuing bonds for the $225 million city share of the ballpark’s construction.

The project is facing seven lawsuits, with six on appeal. A lawsuit filed last year by Bruce Skane and Jerry Mailhot, which had a hearing in Superior Court last week, alleges the City Council violated provisions of both the state’s Political Reform Act, and its own charter regarding votes taken on the ballpark.

That suit, and four others, are by plaintiffs represented by former councilman Bruce Henderson, who has opposed the ballpark project since its inception.

Although a victory by the city and the Padres in the state Court of Appeal on a separate lawsuit was encouraging to ballpark proponents, Henderson vowed to take that suit to the Supreme Court.

Even in a best-case scenario, the estimated window on resolving the city’s legal entanglements is six to nine months away, according to the city attorney’s office.

But all bets are off if the state Supreme Court decides to hear one of Henderson’s cases. A legal challenge to the San Diego Convention Center expansion by plaintiffs belonging to the Libertarian Party and appealed to the state Supreme Court delayed that project’s start by more than a year.

Beyond the legal problems besetting the ballpark, there is a growing feeling on the council, now dominated by the five newly elected members, that the city may not be able to afford paying the estimated $25 million debt service on the bonds without sacrificing existing city programs or delving into the city’s general fund.

The adopted financing plan called for the bonds to paid entirely from hotel room taxes, called transient occupancy taxes. However, several key hotels that were to provide a large portion of the revenue for the bond payments have yet to be built.

A planned 1,200-room hotel at the Campbell Shipyard site has yet to get necessary government approvals, and another 750 rooms from an expansion of the Hyatt Regency has been stalled for more than a year because the developers, Manchester Resorts, cannot find financing.

Councilman Jim Madaffer was among those who have stated publicly they will not put the ballpark above other more pressing needs in the city.

“Don’t get me wrong, I support this project but I refuse to be boxed in on a vote next week if that means back to business as usual,” Madaffer said. “I’m not convinced we have the hotel rooms. It’s very simple. Hotel rooms are going to pay for the ballpark, but we don’t have the rooms.”

Scott Barnett, executive director of the San Diego Taxpayers Association, said the council should be looking at alternative financing arrangements for the ballpark, including the use of tax increment funds.

Tax increment refers to the growth in property taxes as a result of redevelopment that are retained by the city for use within the designated area. In a redevelopment zone, the city can retain all the property taxes for an area instead of sending 83 percent to the state.

Peter Hall, president of the Centre City Development Corp., the city’s Downtown redevelopment agency, said the CCDC board has talked about the use of the increment tax financing for the ballpark, and will likely recommend using those funds if that helps get the project moving.

The ballpark project, a planned partnership between the city and the Padres for the $1 billion redevelopment of a 26-block area in the East Village, was approved by nearly 60 percent of city voters in November 1998.

The ballpark’s current price tag, including land acquisition, the ballpark construction, and infrastructure improvements, is $452.6 million. Construction, which started last February, was halted in October after an interim financing package of $30 million ran out. The Padres said about 20 percent of the project is completed. The total expenditure on the project to date is about $138 million, including $81.4 million in city funds.


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