Breaking Down San Diego's 'Citizens' Initiative'

Top story I Midday Edition, proposed ballot measure that only the most hard-core Mac policy wonk above is part of San Diegans Christmas shopping experience. People are asked to sign petitions in support of something that could say the Comic-Con. Or it could help build a downtown Chargers Stadium what the measure would really do is far more complicated we are talking about the citizens initiative proposed by attorney Cory breaks up San Diegans for open government. With an overview of the proposal, which is formally called the citizens plan for responsible management of major tourism and entertainment resources. She is also of San Diegans for open government and a welcome to the program. Hi. How are you? I am doing great. Thank you for joining us. Can you tell us the main points that this initiative asks voters to approve? Short. And I just want to say that what is complicated are the problems that have been created. Our solution is pretty simple. Such as kind of put that out there. Essentially, what the citizens plan does is it increases by five cents for every hotel, room rented dollar, the amount of money that can be used for the general fund purposes, such as deferred maintenance and our infrastructure. This increase is going to keep San Diego competitive with other cities. It also preserves our natural resources by protecting the public access to San Diego Bay. Because what it does is it relocates the proposed convention center expansion away from the waterfront. It also allows for the potential to create public park plan and educational facilities at Mission Valley, walk on property site. It provides exemptions to avoid litigation but it requires mitigation. That is something that only the voters can do, the citizens are the only ones that can do that. It allows either a downtown or Mission Valley Chargers Stadium location, but it does not commit any public funding and that would require a separate public vote. A provides tax incentives for the hotel industry. It provides up to four cents out of every dollar from rent and to sense of that can be used to promote the city and to finance tourism related facilities. And also to make repairs and perform maintenance on our existing infrastructure. So is the purpose of this to create a convention center expansion? Or a new stadium for the charges? It is to allow it. It is not to create it. Okay. It is to allow some options and provide those options under certain circumstances. And it allows the hotel -- again, they can get up to two cents and tax incentives. To help finance the tourism related facilities such as the convention center. Are you comfortable with the way signature gatherers are promoting this as a proposal that will save Comic-Con? Or help build a stadium? I have seen a lot of bad around town, holiday shoppers, big tables being set up in front of grocery stores and so forth. Is that something that you are comfortable with? I think that the main thrust of this is that it allows the public to vote. On public policy that they have been shot out of for the last -- well, since as long as I remember, 2005, 2006. If you recall, it has only been the hotel years that have been allowed to vote over the past many times, if there would be 18 OT increase. I would like that to be stressed more. That is certainly what I will be stressing and have been stressing is that, for so long, the public has been shot out. The voters have not had a seat at the table. The TLT has been raised on three different occasions. And each of those occasions, the public was not allowed a vote and when they are not allowed to vote, they are left out of any sort of Venice -- benefit because the way that the money would be spent is decided by the hotels. We are going to talk more about this with Scott Lewis but Donna Fry. Thank you for joining us. Had say hello to Scott. I will. Joining me now is Scott Lewis of voice of San Diego, the hard-core Mac policy wonk that we need. [ Laughter ] How are you? I am good. What is the actual financial mechanism of that voters are being asked to approve? I think at the heart of this, you should understand that why we have a 10.5% tax rate for hotel rooms, you pay $100 and will pay $10.50 per night, on top of that, there is a lovely called the tourism marketing district that is 2%. And I think it is important to remember that on your hotel bill, you are likely going to see that say TMD tax. It is a tax. It is essentially -- they describe it as we essentially have a 12.5 hotel room tax. That 2% is right now in jeopardy. It is in jeopardy the same way that a similar tax like it was in jeopardy that was going to find the convention center expansion that was thrown out by a court. That jeopardy is kind of what is bringing some people to the table to talk about this. What this would do is get rid of that 2% and replace it with just a straight tax increase, all the way up to 15.5%. Again, the real ingenious but also problematic part of this plan, there are a lot of different interesting parts -- but this -- what she described, that incentive, basically would say that the hotel owners, instead of turning 15.5% over to the city, were turned over either 12.5% or 14.5%, depending on if they actually spend money themselves to do what the TMD, that levy 2% is doing right now, which is to promote San Diego. Or the 2% to pay for convention center facilities. Instead of a group of hotel owners called the tourism marketing district putting on an additional tax on people who stay in hotels in San Diego, all of San Diego is being asked to vote on a 15.5% tax on people who stay in hotels in San Diego. The origin of this goes back to 2004, when the city Council tried to raise the regular hotel room attacks from 10.5% -- to 13%. They failed in two votes, the vote of the people, they both times through it out. So the hotel still wanted -- wanted to raise money for promotion of San Diego, so the they did something to get around the boat is they tried to create a business improvement district but for the whole city, four hotels to get together as a kind of club and pass a self-assessment. Instead of self-assessment, they made it a line item is attacks on the bill and that is the legal case going forward that they are worried about. They do not want to lose that finding for marketing San Diego. As you say, part of this financial mechanism that voters are being asked to approve would allow hotel owners to take back the 4%, 2% to go to tourism management, and 2% potentially to go to convention center expansion. The other thing that it does is it bans the expansion of the convention center on its current footprint -- footprint and the only expansion that they could do as an annex across the street near the tailgate park for the tailgate parking area. City leaders and Comic-Con organizes kind of like the idea of on the waterfront expansion. They do. Who likes the idea of the Annex? There was recently a study the put out that if you compare the two options, and the mayor decided after that study that he liked the one along the waterfront more. But there is another problem with that. The same way that the taxes in jeopardy, also this expansion of the waterfront facility is in jeopardy as well because the attorney Cory Briggs who is behind this has a lawsuit that says that that blocks access to the waterfront and that is illegal according to California law and they think that that has substance as well as a lawsuit. The other thing to think about this is that it does not build a stadium and a signature gatherers says it does, you should challenge them. They have been told not to say that. It does not facilitate the construction of a stadium. What it does do is a clears way the environmental hurdles as far as permitting for a new stadium in downtown and in Mission Valley. So the mayor if he wants to continue with the plan to build a stadium in Mission Valley, he would have yet another clearance for that facility in Mission Valley. Again, it actually bans funding of a public funding of a new stadium. If you are interested in a stadium, this only helps that if there is a follow-up vote that authorized the public spending. Finally, it also reserves 100 acres of land in Mission Valley for San Diego State and for UC San Diego, which I think is a fascinating part of this discussion as well. If the Chargers leave and that stadium is demolished, there would be a sort of education Center if this were to come to fruition. I want to have you expand on that point a little about the ban of public funding for the development of a stadium, because we called the sponsors of this to try to clarify that. What we were able to understand is that it would ban public funding for a downtown stadium. But basically, it would not stop any public money going into this stadium in Mission Valley. Is that right? Yes. [ Laughter ] This is a long think that is the way to understand it. My point is that if you are into the downtown stadium plan, it would not do that. How would it be funded if they were ban any public funds? It there would have to be a follow-up and the mayor pledged a vote for any stadium because Ford and so ostensibly this would be a boat that would have to happen. This boat would happen in June and that would probably happen in November if it falls into place. A lot of people think and I think with good reason as I have said that the Chargers are determined to move and probably will move. Maybe it will not matter. Who came out in favor of this citizens initiative that we are talking about? Environmental political group, legal conservation voters, Donna Frye, and importantly John Morris, the former owner of the -- the Padres. And the company that he is a part of called JAMA Realty is pretty significant dollars into that. They have a plot of land near where that Annex convention center would be, and they would build a hotel there. John Morris -- since your take on this if he is not just interested in that hotel project is that he is really passionate about San Diego State being able to expand out of his boundaries in Mission Valley. So it is a fascinating discussion. The real thing to watch right now is any potential legal challenges. The one legal concern is that ballot measures are supposed to be one topic, single subject, and they have argued -- argue this is a single subject which means that all of the tourism a visiting industry assets are considered and you have to consider all of this as a whole and that is the single subject. On the other hand you consider obviously this is not a Sigel subject and there are so many different parts that they could challenge on that. The second worry would be that it would actually require two thirds vote as opposed to a majority vote because of the argument that this morning that the hotels would use for finding marketing and convention center is a type of your mark that would require a two thirds threshold according to California law. They do not have to invest in this convention or in this marketing and it is completely voluntary. That is sort of disingenuous. I don't think so. They don't have to at all. They obviously probably will but many of them may choose not to and in which case they would pay the full tax. So it is completely voluntary -- it should be completely voluntary. I think that the interesting part of that is, well, who actually pays the tax? Visitor to a hotel pays the tax? They are not seeing any deduction according to their feet -- they will pay 50.5% to matter what. The idea that it is a deduction is comforted by that. There is a lot of moving parts. A lot of interest. You said that if indeed somebody out shopping sees a signature gathering think that this is going to keep the Chargers in San Diego by facilitating a new stadium, that is not correct. I don't think they are but I think they've been told specifically not to and I ran into a God at liberty Station and I have grilled him and I pretended not to really know very well and I grilled him. And he passed and afterwards I told him good job. I pushed him pretty hard. The Comic-Con thing is a little bit of a stretch. Basically there think that the city has been so terrible about building a convention center expansion that this is a route to that and they have already failed on expansion the expansion P that they tried to pass on the tax that they tried to pass so this is a more secure route. How many signatures to the have to get and when might we see this on the ballot? They will have to get about 70,000 or more valid signatures, meaning that they will have to get more signatures than that. So three dollars or four dollars and signature, you can picture how much that will cost so they have to raise more money. Also, I think that there is a lot of pressure to get it on the June ballot for various reasons. Because, if -- well, it might end visit tourism marketing dollars so they might do to -- if the hotels are going to keep that going, then they will need to get their act together to do the new thing. I think that they also look at November as a potential to have a better chance of passing. My final question to you, if indeed the NFL comes out early next year and says the Chargers are going to be allowed to relocate -- does this initiative have to be changed in any way? Not at all. I think it is built in a way to facilitate all of these other things quite well and in fact it might even facilitate some sort of soccer stadium or something downtown. All it does is clear the environmental hurdles in a sort of blueprint for the area. And it does that same environmental clearance for Mission Valley. Again, the concern really is -- will people understand it? Will it make it to the ballot? Will it be legal? Will somebody sue? And then I think that we are going to watch the visitor industries the people to watch. Will the hotel industry consider supporting this? I understand that the TMD, the group that oversees this -- about $30 million that comes in every year that is in jeopardy or this lawsuit is going forward about, that is at trial and the ruling is expected next year. They are getting together on Friday to discuss this in depth. So we might have some more insight after that. [ Laughter ] Thank you. I have been speaking with Scott Lewis of voice of San Diego. Thank you so much. No problem.