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Funds Seized, Flap Erupts in Little Italy

The Little Italy Association is looking for answers following the recent seizure of Little Italy Business Improvement District funds by City Attorney Mike Aguirre.

According to a press release from the Little Italy Association, on Feb. 27 Scott Kessler of the San Diego Economic Development Department notified the association that its funds were going to be frozen without giving a reason.

Little Italy merchants fill the business improvement district funds, which the Little Italy Association , a private, 501(c)(3) nonprofit corporation , uses to support events and other merchant causes.

After business hours on March 14, Aguirre released a statement that said the funds were being held in accordance with a search warrant issued by federal and local law enforcement in October “on the offices that administer the Little Italy Business Improvement District and Maintenance Assessment District.”

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The business improvement and maintenance assessment districts fall under the umbrella of the Little Italy Association. The office administering Little Italy Association funds is New City America Inc., run by Little Italy Association Chairman Marco Li Mandri.

Little Italy Association Secretary Tom Di Zinno confirms that New City was the recipient of the search warrant, but he doesn’t know the warrant’s scope or purpose since it is sealed. “Nobody knows what it’s for,” Di Zinno said.

Di Zinno is crying foul, though, and said that seizing the association’s funds based on a search warrant issued to New City makes as much sense as “punishing HBO for a search warrant issued to Cox Cable.”

“The search warrant has nothing to do with criminality,” said Di Zinno, who, in a letter, added that search warrants do not require proof or suggest criminal liability.

“Mike Aguirre said he has responsibilities to check on Little Italy expenditures. If he wants to review our expenditures, he should walk down (his) hall!” said Di Zinno at a March 15 news conference.

“We believe that there is a takeover for business improvement district funds. Now, Mike Aguirre is threatening to seize the maintenance assessment funds.”

When called for comment, Aguirre’s office referred questions to Mayor Jerry Sanders’ office. A Sanders spokeswoman did not immediately return a phone call.

Business improvement district funds total $100,000 annually and help Little Italy run the Art Walk and Sicilian Festival events that bring 200,000 people to the area.

Maintenance assessment funds are $700,000 annually and come from fees that merchants assess themselves, paid on top of their property taxes. The funds are then used to provide extra city services, such as street cleaning, lamps, upgrades and repairs to the district.

Since the business improvement district funds have been seized, the Little Italy Association has laid off its only two improvement district fund administrators.

If a seizure of the maintenance assessment funds took place, 16 employees who administer those funds would have their jobs at risk, Di Zinno said.

, Andy Killion

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