San Diego October 12, 2006. Remember that date. Excuse me: forget that date. According to the late-June report by Mayor Jerry Sanders's purported Office of Ethics and Integrity, the City's real estate czar, Jim Waring, didn't learn that regulators objected to Sunroad Enterprises' dangerously tall Centrum 12 building until October 12 of last year. That assertion -- along with many others in the self-professed investigation -- is very leaky, as City documents show.
Back in April of last year, according to the alleged investigation, the City's Development Services Department first learned that the Federal Aviation Administration was concerned that Sunroad's planned building near Montgomery Field violated air safety standards.
But Waring supposedly didn't hear a peep. On June 19, the FAA officially stated that the building was too high for air safety. The word was passed to Gary Halbert, then director of the Development Services Department, by Tait Galloway, senior planner in the Planning Department. Galloway's note had an urgent tone: "The FAA wants the building height reduced to 160 feet.... This proposed project would affect flight operations at Montgomery and affect the City's ability to receive future FAA funding for Montgomery." Halbert met with several planners and was told that Sunroad would keep the building's height at 160 feet, thus staying within federal and state guidelines. On June 19, an e-mail saying that Sunroad would not exceed 160 feet was CC'd to Waring. Unless he routinely doesn't read his e-mails, he must have known something about the situation at that time.
On June 19 from 4:00 to 4:15 p.m., Waring met with Sanders and an aide. The following day, from 11:15 to 11:30 a.m., Waring and Halbert talked with Sanders. The City isn't saying what they discussed. Winnie the Pooh?
On July 6, Halbert huddled with Waring to turn in his resignation. "This investigation could not confirm any discussion between the two" about Sunroad's height problems, according to the so-called probe.
On July 27, Galloway wrote to Halbert, stating that Sunroad, despite the warnings, planned to complete the building at 180 feet, as the City had earlier said it could do. Galloway said that the FAA would therefore issue a notice of hazard for the project but would amend circling procedures for Montgomery Field.
On August 11, the FAA issued an official "Determination of Hazard to Air Navigation" in a letter to Sunroad. By this time, the building had already reached the taboo 180 feet. At the request of Sunroad official Tom Story (the former head of City land use), Sunroad executives and City bureaucrats immediately huddled on the problem. Notes reveal that at the emergency meeting, a Sunroad lawyer said the City must "balance airport issues with land use" -- a philosophical view that Waring would later expound on at length. Story pointed out that the structure was up and the floors were poured. On September 5, the group caucused again. But, we're supposed to believe, nobody told Waring, the boss.
On September 14, the California Department of Transportation wrote Sunroad, warning, "It is unlawful for you to proceed with construction." One County and three City agencies got copies of that letter. But nobody, we're told, informed Waring, who huddled with Sanders for an hour and a half on September 16. Maybe they talked about Harry Potter that time.
Then on October 10, the City's Airports Advisory Committee decided that the California Department of Transportation was right: Sunroad should not be allowed to finish the building. At last, Waring was informed, according to the purported investigation, which stated, "This appears to be the first substantive notification to Jim Waring concerning the height limitation."
It all smacks of hogwash. First, it makes no sense that high-level City bureaucrats were told by the federal government in April that a building defied safety standards; got official word in June of the violation; learned in July that Sunroad would flip the finger at the federal and state governments; got word in August of the official hazard designation; were informed in September that the building was illegal, but didn't tell the big boss until October.
I phoned Halbert, who is now deputy city manager of Santee. "I have moved on to the City of Santee," he said. "I would let the record [of the purported investigation] represent what it does." Does that mean, I asked him, that Waring was not informed of the egregious violations until October 12, as the report claims? He chuckled. No, he said, he is not necessarily agreeing that Waring didn't get the word until October 12. He chuckled again. In almost 45 years of financial journalism, I have heard such chuckles before. They have a special meaning.
Tellingly, during the period beginning in spring of 2006, Waring was helping Sunroad on another of its problems: the relocation of a Sempra Energy substation, a long-simmering feud between the utility and the developer. Sunroad wanted to construct homes, but the substation presented a danger to potential residents. Still, Sunroad resisted moving the substation to an area that it wanted to use for a Centrum 12 parking lot. Sunroad wanted the City to relieve it of the obligation to relocate the substation. During the meetings on the topic, Waring was on a first-name basis with Aaron Feldman, owner of Sunroad and major fund-raiser for Sanders.
On April 6, Halbert contacted a Sempra manager. A letter was being sent to Sunroad, explained Halbert. The letter had been first sent to Waring, "and he is making some edits," said Halbert.
Shortly, Feldman heard from Waring. He and Halbert would be happy to meet with Feldman, enthused Waring, who wanted the issue resolved at that meeting.
On April 17, Waring wrote to the Sempra official and said, "Gary [Halbert] and I will be meeting soon with Aaron Feldman. I saw Aaron last week and told him we had serious concerns with the substation. He indicated that he wants to come meet with us and explain why he thinks he has fulfilled his obligations." On May 11, there was a meeting among Sunroad and City officials. Attendees included Feldman, Story, Waring, and Halbert.