This story was reported for San Diego News Network on September 8, 2009.
He rejected the idea of asking voters to raise the hotel tax for fire protection last year.
But this year, he may endorse the same idea to raise money for the convention center expansion.
After the final meeting of the Convention Center Task Force last Monday, San Diego Mayor Jerry Sanders will now have to consider how to garner revenue for their recommendation of expanding downtown’s coveted building. But if he backs the idea of raising the hotel tax (transient occupancy tax) to gain revenue when he didn’t in 2008 for fire protection, he may hear a ruckus from voters.
“To put a TOT increase on the ballot for the convention center while having done nothing for fire protection, to me is craziness,” said former San Diego fire chief Jeff Bowman. “L.A. firefighters, as well-funded as they are, have been struggling the past two weeks as we all know.”
Expanding the Convention Center on the TOT dime
It’s no secret Sanders supports the idea of expanding the convention center when it comes to the city’s financial benefit, but raising enough money to support the project is another story.
Under the watch of the mayor, the Convention Center Task Force was established to determine whether expanding the building would be make economic sense. Last week, the 17-member-task force passed a motion to support an expansion – with San Diego Taxpayers Association CEO Lani Lutar as the odd person out and Environmental Health Coalition executive director Diane Takvorian absent.
Along with support of the expansion, the task force was also required to offer suggestions to the mayor about how to raise the $753 million to expand the center by 200,000 square feet. Among its suggestions included a citywide increase in hotel tax. The task force estimates that a 1 percent increase can bring in about $14.7 million, a 2 percent increase can bring in about $29.4 million and a 3 percent increase can bring in about $44.1 million.
Other suggestions included a TOT limited to downtown San Diego that could generate roughly $5 million up to $15 million dependent on the percentage of the increase or having a restaurant district bid assessment. Asking other public agencies such as the Port of San Diego, Centre City Development Corporation and the County of San Diego to invest is also a suggestion.
Protecting San Diegans from fire
With wildfire season blaring up and Gov. Arnold Schwarzenegger speaking candidly about the lack of funds for protection – is San Diego in the same boat? The city’s former fire chief Jeff Bowman thinks so and that’s why he resigned in 2006.
Bowman — who told The San Diego Union-Tribune in 2006 he felt like an “architect hired to build a house for a client who ran out of money” – said the city and the county has failed to provide enough funding for fire protection.
“I was brought here from Anaheim in 2002 with the intent of fixing the shortfalls,” Bowman said. “After outlining the shortfalls, I was told there wasn’t much the city could do because of the financial problems.”
“Sanders reiterated the same thing when he stepped into office (in 2005).”
Twice in 2004 though, city officials attempted to gain revenue through TOT increases for fire protection. Both measures failed. Additionally the San Diego County Grand Jury released a study suggesting the idea in May 2008.
In addition, the report stated, “Forty-six percent of the time the department cannot meet the national five-minute response time. Rancho Bernardo, the San Diego community that lost 365 homes in the last fire [2007] has one fire station that was built in 1969.”
Sanders responded in a memo simply stating, “The recommendation will not be implemented,” citing the previous failed measures in 2004.
Bowman says he believe Sanders rejected the idea because he and County Supervisor Ron Roberts pushed for Proposition A in 2008, which, had it been passed, would have raised parcel tax and the revenue would have been allocated to fire protection.
At the time, an article in The San Diego Union-Tribune in November 2008, cited Sanders unique stance on tax increases for fire protection — he didn’t support TOT tax increases but supported a parcel tax increase. The article also notes that Sanders addressed tax increases during the mayoral campaign against local businessman Steve Francis and would accuse Francis of “flip-flopping” on the issue.
The article stated:
As Sanders continually accused Francis of proposing “at least $175 million in new taxes,” Francis kept countering that the mayor “wants to play politics with fire protection.”
Sanders defeated Francis in June, in large part by accusing him repeatedly of flip-flopping on a number of issues, including taxes. Once Sanders even disparaged Francis while wearing a pair of flip-flops as a prop.
“In San Diego, we know flip-flops are for the beach, not City Hall,” Sanders said at the time.
This week, Francis, who also supports Proposition A, declined to “rehash history.”
“I’m not going to take potshots at the mayor and say, ‘I told you so,'” he said. “What’s important now is for me to be supportive as much as I can and to try to bring public awareness to the issue.”
“I don’t think I flip-flopped on this,” Sanders said. “I think it was a considered issue.”
At any rate, Proposition A did not gain the two-thirds majority vote needed to pass with only 63.58 percent of voters approving of the measure. After the measure was rejected, funding for fire protection has not been addressed since with the exception of the mayor’s recent announcement about the city’s preparedness.
“There was a political desire by them [Sanders and Roberts] but they did not make it a priority,” Bowman said. “There was not a unified effort politically to make it pass and there was no Plan B.”
Despite protest about the allocated funding for fire protection, dollars have gone up for the department. According to fire department spokesperson Maurice Luque, the budget for the fire department has increased though.
In 2005, funding for the fire department was $149.5 million. Now, it’s $201 million. In addition, the Rancho Bernardo fire station cited in the Grand Jury report is undergoing a remodeling and now staffs one more firefighter – making the total amount four.
The fate of the expansion and Sanders
Sanders’ spokesperson Rachel Laing said meetings are still underway to determine which financing options are best for the expansion of the convention center – whether TOT increases is a good option has yet to be determined.
“The Task Force recommendations are just the beginning of a long process. From the outset, the Task Force’s charge was to engage the public and diverse civic interests to determine if there was a market for additional convention space and whether more space was needed for San Diego to remain competitive; evaluate the feasibility of expanding; and identify some of the options for financing that rely on center-related revenues,” said Laing in an e-mail.
“The next step will be to determine what the scope of the expansion should be, then have stakeholders come up with the best option – or combination of options – to finance it. The stakeholders would be representatives from the businesses who could be affected by any financing mechanism, which is mostly the hospitality industry – rental cars, Downtown restaurants, hotels.”
Laing concluded that the process must be completed and until the mayor has an “opportunity to consider the feedback, he won’t be drawing conclusions.”
Taxpayer advocate and councilmember Carl DeMaio said tax increases are not a viable option for the expansion of the convention center – or for anything. DeMaio — who said he is “supportive of the convention center as an economic concept” – asked that the task force look for financing options that doesn’t involve the city’s general fund.
He said the problem isn’t whether an expansion of a building is more important than fire protection, rather it’s important to “cut waste” from the city’s budget.
“If a tax increase is on the ballot, for whatever purpose, I wouldn’t support it,” DeMaio said. “If you raise taxes, it goes into the pension system. The pension payment will be [raised by] $75 million annually. How much fire protection could we pay for if we were to reform the pension?”
“Taxpayers would probably get more benefit by burning their money in the middle of the street than trusting their city government in spending it wisely.”
Lani Lutar was not available for comment as she is on vacation. Mike McDowell, task force member and chair of the San Diego Taxpayers Association did not respond by press time. Hoa Quach is the political editor for the San Diego News Network.