Tuesday, September 30, 2008

Recall Mayor Cheryl Cox press conference

September 30, 2008

Press Conference: Communities Taking Action, a new grassroots organization, takes the first steps to recall Mayor Cox

276 4th Ave Chula Vista, CA 91910 (map)
Joins us for our press conference where we announce that we are recalling Mayor Cheryl Cox. This will take place in front of City Hall at 6:00 PM.

Days earlier, Channel 10 covered another protest against Cheryl Cox.

Chula Vista Power Plant Protest

CEC Protest at Chula Vista City Hall
Thu, Oct 2, 5pm – 7pm
276 4th Ave Chula Vista, CA 91910 (map)

California Energy Commission meeting begins at 10AM in Chula Vista City Hall. You can come early if you wish. PROTEST begins at 5PM. Make sure to bring your kids, family, and friends. Plenty of parking on Davidson Street.

Open government=rule of law

"...[W]e have to deal with the big issues at hand: the loss of open government, the degradation of the rule of law..."
--Mike Copass

Saturday, September 27, 2008

Where did Bonnie Dumanis send former PIU chief Patrcik O'Toole?

In March 2007 (see photo above) San Diego District Attorney Bonnie Dumanis announced the formation of the Public Integrity Unit with much fanfare.

Bonnie Dumanis recently moved controversial Public Integrity Unit chief Patrick O'Toole out of the unit. But what is he doing now?

He continues to be absent from the District Attorney's office flow chart. But perhaps that is because he doesn't want to be seen as subordinate to Bonnie. He'd rather not be seen at all.

I guess Bonnie and Pat want to leave the matter of O'Toole's current assignment up to our imaginations.

Here are some possibilities I've come up with:

1. A new PIU has been formed, known as the "public intimidation unit" or, alternatively, the "political impact unit." It will continue to investigate political enemies, but in a secretive manner.

2. O'Toole's new job will continue to involve the tipster(s) who initiated the investigations of the Chula Vista city employee who took 2 hours off work to spy on mayor and former CVESD school board member Cheryl Cox's yacht party with David Malcolm, and councilman Steve Castaneda's claim that he never planned to buy a condo which he never bought.

3. O'Toole will ask for and receive assistance from his friends in the Bush Justice Department, an office which has proven to be expert in political prosecutions (Don Seligman), and hiring and firing based on ideology and politics (Anthony Gonzalez and Monica Goodling and the eight fired US attorneys).

4. O'Toole will prove to be an invaluable aid to Dumanis' political ambitions, or, alternatively, the two of them will go down in flames together when their secret shenanigans are exposed.

Friday, September 26, 2008

Chula Vista falling apart under leadership of Cheryl Cox and Steve Castaneda

Scott Lewis writes about Dave Garcia, the fired city manager of Chula Vista, and his relationship with mayor Cheryl Cox and Councilman Steve Castaneda. After attacking Cheryl Cox regarding perjury charges that were rejected by a jury, Castaneda seems to be working well with Cox in their joint effort to make questionable and secret charges against the city manager.

Help Wanted: Doctor, City of Chula Vista
By Scott Lewis
Sept. 18, 2008

...The dysfunctional City Council could not even agree to protect taxes and fees the city already charges. There will be more revenue losses.

There are some city managers who see it as their job to placate their nervous bosses on city councils -- giving them what they want (low taxes) and avoiding what they don't want (painful and unpopular cuts). And some of them are clever enough to push off budget obligations even in the toughest of times. David Garcia, whatever you think of him now, was not one of those managers. He spoke with a sense of reality about the situation all local cities are in and he didn't hide the necessary pain.

If the City Council, consumed with short term convictions, chooses someone the politicians can bully, Chula Vista will someday fall off the rails and ground to a halt.

So why do they even need to choose a new manager? Why was Garcia fired without an explanation? I don't know. A month ago, the local newspaper revealed that Chula Vista Mayor Cheryl Cox had officially chided Garcia for viewing what was called "inappropriate" images on his computer. Cox and Garcia agreed that the matter had been settled between the concerned employees who had complained and Garcia. The word "inappropriate" implies quite a spectrum. Managing a fantasy football team, for instance, could be "inappropriate" but so could viewing pornography.

The fact that the matter had been handled to supposedly everyone's satisfaction implied that whatever Garcia was viewing was more on the former side of the spectrum than the latter. Garcia's attorney, Bob Ottilie, said that the images were vacation photos. Again, "vacation photos" can include quite a spectrum of images. And there is no excuse or apologizing for a man who would create a hostile work environment by displaying nude pictures or something.

Unfortunately, the city has, to date, not released the details about what was inappropriate.

So only a few people know what was happening. And the one who seemed most interested in getting rid of Garcia and sharing what was supposedly inappropriate with reporters -- City Councilman Steve Castaneda -- did not return my call for comment.

I asked Mayor Cox in a dozen different ways to share some insight about what had happened. If Garcia had played better with Castaneda and others, would he have kept his job? What changed between when she seemed OK with the issue between Garcia and now when she joined the 4-1 majority that had him fired?

She wouldn't say.

OK. I went at it differently. Had Garcia's tough approach to balancing the budget created enemies?

"Any time you're involved in a situation in which you are in a hiring freeze and the employees are asked to do more and any time you're involved in layoffs or diminished opportunities the employees will tend to compete and there will be people who are concerned," Cox said.

In other words, yes.

So was this partly why Garcia was fired?

Again, she wouldn't say.

"The City Council believed we needed to make a change in order to move forward together. It became clear that this action was in the best interest of the city," Cox said.

"In order to move forward" is an interesting way to put it. This implies that whatever it was that some City Council members were not going to put behind them what had besmirched Garcia. The dysfunctional body would apparently function even worse.

Yes, that's the last thing Chula Vista needs.

The city is sick to the bone...

Risk factor for fraud: employees (like SEDC's Carolyn Smith) who never take a vacation

Why didn't Carolyn Smith take a day off? Maybe she was afraid fraud would be uncovered.

Why No Vacation is a Risk Factor
September 11, 2008

...The [SEDC] audit states that Smith claimed not to have taken a day off for sick leave or vacation because she enjoys her position.

The audit then says this:

A risk factor for fraud in any organization is present when key employees work for many years without taking time off.

I talked to a source of mine who is familiar with these kinds of issues and asked the source why this is a fraud risk.

The source said one reason why certain employees don't go on vacation is because they're afraid that someone will step in their place and "their whole scam will unravel."

"It is very common in fraud situations that you will find people will either not go on vacation or not relinquish their duties to someone else," the source said.

The audit did find fraud in SEDC's hidden system of bonuses; Smith continues to maintain that the documentation her agency provided was sufficient.

Update: I heard back directly from Denise Callahan, the Macias Consulting Group partner that led the audit. This is what she had to say:

A risk factor becomes present when employees do not take vacations because there could be a desire to hide or conceal inappropriate activity. In fact, fraud tends to be uncovered when key employees had to be on leave/vacation and were not able to continue to conceal the activity.


CCDC's Nancy Graham charged with ethics violations and conflict of interest

Why didn't Bonnie Dumanis' Public Integrity Unit file charges in this case?

Criminal Charges Brought Against Nancy Graham
Sept. 12, 2008

City Attorney Mike Aguirre's office has charged former Centre City Development Corp. President Nancy Graham with three misdemeanors, alleging that she improperly used her position and failed to disclose her potential conflicts-of-interest.

The charges, filed Wednesday in San Diego Superior Court, say Graham participated in a decision in which she had a financial interest. Graham also faces two counts of violating local ethics rules. One count alleges that Graham influenced the negotiations of a downtown condominium and hotel project at CCDC, the city's downtown redevelopment agency, when she knew it could benefit a former business partner.

The other count says Graham failed to accurately disclose her economic interests. Before moving to San Diego in 2005, Graham worked as a developer in Florida, where she had a business relationship with The Related Group, a large Florida development company. Together, they built a mixed-use condominium project, a partnership that Graham estimated had paid her almost $3 million as of last summer -- including a $125,000 payment that came in mid-2007. Graham did not subsequently report that income on the annual conflict-of-interest form that public officials are required to submit to the city.

The charges say that Graham and her husband began receiving income on March 7, 2006 and continued receiving payments through April or May of 2007.

Graham received the money while she participated in negotiations at CCDC about a city-subsidized $409-million, 41-story hotel and condominium project proposed by The Related Cos., an affiliate and part owner of Graham's Florida business partner. CCDC selected the company as the project's preferred developer in March 2007.

The project at 7th Avenue and Market Street downtown would have been built atop city land and included an $8.7 million city subsidy for including affordable housing. CCDC's board unanimously voted Wednesday to kill that project, citing Graham's involvement and undisclosed business partnership.

State and local laws prohibit public officials from influencing decisions that can benefit themselves, their spouses or their business associates. The laws extend the prohibition for a year after receiving money from a source...

To Regina Petty, SEDC lawyer: Don't let the door hit you on the way out

Voice of San Diego
September 25, 2008

Regina Petty, corporate counsel of the Southeastern Economic Development Corp., will not seek to continue as the agency's lawyer, Petty told SEDC's board at last night's meeting.

Petty will stay at the agency while SEDC searches for new legal representation, said SEDC board Chairman Cruz Gonzalez. The board voted last night to issue a request for proposals to find a new attorney for the troubled agency, but Petty said she would not apply to be the agency's lawyer.

"It has been a privilege for me to be SEDC's attorney, and, although I continue to be well qualified to serve -- better qualified actually than when I started as counsel -- in order to have a proper attorney-client relationship, you have to have board members that are willing to reasonably listen to your advice, and care about complying with the law. It's not clear to me that that is currently the case with this board." Petty said.

Petty has been criticized by at least one member of the board. In July, Derryl Williams sent a letter to Mayor Jerry Sanders criticizing the culture of SEDC and the way board meetings have been run.

Williams wrote:

Using corporate counsel and Special Agency Counsel, the President of SEDC controlled questions and the flow of information so that board members could not obtain sufficient answers to assist in making good judgments.

Petty was also criticized by City Attorney Mike Aguirre at an SEDC Executive Committee meeting last week.

"I want to look Carolyn in the face and I want to say 'Regina, it's time for both of you to go,' in my opinion," Aguirre said. "I've listened to several of the meetings, I've listened to the legal advice and I have to say the legal advice is skewed in favor of the existing management."

And the author of a damning audit of the agency, released two weeks ago, also mentioned Petty's legal advice. The lead auditor said some board members her team interviewed felt that Petty "would convey info they didn't believe was quite accurate." ...

Tuesday, September 09, 2008

Wall Street Journal Endorses Mike Aguirre

'The Garden at This Skunk Party'

September 8, 2008
San Diego's political scene was buzzing this weekend over this Wall Street Journal editorial praising City Attorney Mike Aguirre for his battle against public employee pensions.

The paper describes all of the troubles that have befallen San Diego city government, from run-ins with the IRS and SEC to the $1.2 billion pension deficit.

Then it says:

The garden at this skunk party is City Attorney Mike Aguirre, who has made himself very unpopular with the political establishment by suing to rescind the 1996 and 2002 pension promises. Though a liberal Democrat normally sympathetic to unions, he says the benefits were granted as part of "the largest municipal securities fraud in American history," and so taxpayers shouldn't have to honor them.

It goes on to talk about similar pension problems in New York and New Jersey, and closes like this:

Taxpayers in those states need a rabble-rouser like Mr. Aguirre willing to stand up to union interests. The San Diego attorney faces a tough re-election battle in November, but he's setting off an alarm that voters across America need to hear.


Do CCDC officials cover up until they can't cover up any more?

The following story from Voice of San Diego contains an audio link.

Voice of San Diego

If you're following the Nancy Graham story, you should listen to her comments at an April board meeting of the Centre City Development Corp., the downtown redevelopment agency she once led. (Thanks to Ian Trowbridge and Pat Flannery for the audio.)

AUDIO: Nancy Graham's Statement
At the April 23 CCDC meeting, Graham read a statement into the record about concerns that had been raised that Graham may have had a conflict by participating in the negotiations of a proposed downtown skyscraper. CCDC's board defended Graham at the meeting.

(We later revealed that Graham had received money from an affiliate of the project's developer at the same time she was involved in those negotiations.)

In April, Graham said:

I can guarantee you and I think you all know me well enough to know right now that there's no truth to those allegations whatsoever. ...

Most importantly, I think what they were not aware of is that I did not negotiate this deal, but brought in two people that have impeccable credentials. ... I asked Jerry (Trimble) and Murray (Kane) to come in and negotiate this particular transaction. ... I personally think it would be an absolute insult to the members of the negotiating team to suggest that in any way they would not work to protect CCDC and the Redevelopment Agency's interests or that I could sway them to do something. These guys have incredible integrity. I did not negotiate this transaction. However, having said that, while I think the whole issue is a red herring like they say in law school, I nevertheless feel it's important for me to recuse myself from participating in any further action or discussions with regard to 7th and Market.

That statement and decision drew effusive praise from CCDC board member Jennifer LeSar:

I think it's incredibly unfortunate. I've always found Nancy to be incredibly transparent, very ethical, I've never been surprised by anything that she's done, she's an excellent communicator and has been always forthcoming about the things that have been going on in her life that could have any impact. And I just find this really, really unfortunate. For whoever's behind this behavior, I think it's atrocious. And I guess I just want to say that I think Nancy is taking the higher road here. ... Nancy, I guess I just want you to know, I'm very proud of you. I talk about you in places I do this kind of work. I think we're lucky to have you. In my mind, these going-ons don't taint my impression of you, your leadership here or the work you've done.

CCDC board chairman Fred Maas weighed in, too:

Some of the things that have been said and the tactics and conduct of people who have tried to impugn and indict Nancy has been outrageous. It's been upsetting to me as a person, let alone as chair, for the kind of tactics and untruths which have been circulated regarding this project. ... To make these accusations by whoever for whatever reasons I think is an outrage and it is worthy of scorn by this board and everybody in the community. She has my unqualified support.

Both Maas and LeSar have since been more contrite.

Monday, September 8, 2008

The Un-Refuted Claim

At an April board meeting, former Centre City Development Corp. President Nancy Graham addressed concerns about her potential conflict of interest with the affiliate of a business partner working to build a city-subsidized skyscraper downtown.

"I can guarantee you and I think you all know me well enough to know right now that there's no truth to those allegations whatsoever," she said. "... I did not negotiate this transaction."

But as we've since documented, Graham was in fact involved in negotiations -- at the same time she was receiving money from the developer's affiliate.

James Lough, an outside attorney CCDC hired to investigate Graham's involvement, drew the same conclusion. In a staff report for Wednesday's CCDC meeting, Lough wrote: "Ms. Graham was involved in the negotiations of the potential [development and disposition agreement]."

Lough's conclusion came after reviewing CCDC files and interviewing the agency's staff. But the CCDC staff -- many of whom also had been involved in the negotiations -- did not publicly raise any concerns about the obvious discrepancies in Graham's explanation.

I asked Fred Maas, the CCDC chairman, whether he was concerned by the lack of disclosure. He said:

Lots of mistakes and unfortunate circumstances happened during that period of time. In retrospect I think we all wish we had done things differently, but we didn't. We recognize the omissions and errors and are doing our best to correct them.

September 8, 2008

Friday, September 05, 2008

Mike Aguirre wins regarding police retirement payments

A court has dismissed a lawsuit by police against San Diego City Attorney Mike Aguirre. Aguirre has been trying to reduce pension benefits given away in 2002 by Mayor Dick Murphy, with support from Ann Smith of the MEA. The purpose of the giveaway was to keep unions quiet about a billion-dollar underfunding of the city pension system.Voice of San Diego
September 4, 2008
Court Loss for City Cops

In another legal loss for city cops, a federal court judge has dismissed a lawsuit brought by more than 1,500 city police officers against City Attorney Mike Aguirre and the city's retirement system.

The police officers had argued that their federal constitutional rights were violated when, in 2005, the city reduced or eliminated their employment benefits by mandating that police officers pay higher payments into their retirement plans, thus reducing the take-home pay of many officers.

In her decision yesterday, Judge Marilyn Huff dismissed the case, referring in her decision to an earlier decision she made in a related case brought by the Police Officers Association, the union that represents city police officers.

Huff ruled in that case that there was insufficient proof that the employment benefits that were reduced in 2005 were vested constitutional rights, and that the under-funding of the pension system doesn't implicate federal constitutional rights.

This was the second court loss for city police officers in two weeks. On Aug. 21, another federal court judge dismissed a lawsuit brought against the city by more than 700 officers for breach of contract and unpaid overtime.

"So much for Aguirre never winning a lawsuit," said Executive Assistant City Attorney Don McGrath, who represented Aguirre in the lawsuit. McGrath said that, by his count, the POA has lost six of the seven lawsuits it brought against the city and Aguirre.