continued Last Thursday, in announcing that the ballpark bond refinancing and one other bond offering have been delayed, the city boasted that it has hired a former Securities and Exchange Commission official to review its past municipal bond filings. Beware. Such consultants, particularly those who have had high posts in government, are notorious for providing a whitewash if given a signal by the person paying the bill. Amazingly, Mayor Dick Murphy said the move was meant "to reassure the public that financial statements are accurate." That certainly looks like orders to give a whitewash -- although such sellout instructions are normally communicated with a wink, not a statement to the press.
After the Federal Bureau of Investigation seized records to launch an investigation, Murphy astonishingly said the consultant had been hired to stave off the probe. The consultant, Paul S. Maco, refuses to comment on Murphy's statements but says his marching orders come from the city attorney's office (that's hardly comforting). Maco has a good reputation, but his law firm, Houston's Vinson & Elkins, hardly does: it was Enron's former chief outside counsel and faces lawsuits over the matter. Maco was not involved in the Enron matter.
Another startling example of the overlords' entitlement is Proposition C, which will be voted on March 2. It would raise the hotel tax, called the transient occupancy tax, from 10.5 percent to 13 percent. By itself, an increase in this tax may well be necessary.
But proponents deceitfully hail Prop. C as a measure that would provide more funds to police and fire protection, parks, open-space acquisitions, libraries, and the arts -- all eminently worthy recipients.
The city should be so lucky. Read the fine print. By far the largest chunk of the money goes for corporate welfare -- in this case, tourism promotion. Of every 13 cents collected, tourism promotion gets 2.5 cents. The worthy causes each get from one-fourth of a cent to one cent.
"The impression is that the bulk of the entire transient occupancy tax increase goes to public safety," says councilmember Donna Frye. "In reality, the net effect is that 2.5 cents, which is the entire hotel-tax increase, is earmarked for tourism and sports. Then an additional four cents is earmarked for police, fire, parks, and roads, leaving only 6.5 cents that the council has discretion over."
And of that 6.5 cents, much of the money has to go to paying off debt, such as the ballpark and stadium bonds. "I believe that an increase in hotel taxes is warranted, but we need to make sure that the bulk of the increase goes to support public safety rather than tourism promotion," says Frye.
This spending is locked in -- another reason Frye and others such as the League of Women Voters and Murphy oppose it. The council has limited flexibility to put the money where it is desperately needed, such as the pension fund, which could drive the city into bankruptcy.
Just who is locked into receiving this largesse? In addition to the tourism marketers, many sports groups rake in bucks, particularly the San Diego International Sports Council, a group of pro-sports worshippers/profiteers. The group lobbies for pro-sports subsidies. And then takes money from the city council that it is lobbying. If Prop. C passes, this cozy and ethically repugnant arrangement will be permanent.
Occasionally in history, the peasants revolted against their overlords. Are you ready yet?