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‘Not my responsibility’ is the answer I get wherever I turn. When a government agency incorrectly collects taxes, why will no one accept responsibility?” said Kathy Casey, as she peered through black-rimmed glasses at the management committee of downtown’s Property and Business Improvement District during its February 23 meeting.

Formed in 2000, the Property and Business Improvement District, branded as the Clean and Safe Program, is managed by the Downtown San Diego Partnership. The program provides downtown neighborhoods such services as graffiti abatement, sidewalk maintenance, and patrolling “safety ambassadors” on Segways. The district is funded with property assessments.

Casey is a spry, slender woman who’s in her 60s. She lives in the Cortez neighborhood. According to Casey, a City consultant miscalculated the assessments for approximately 2400 downtown residents over a four-year period. As a result, she estimates that the Clean and Safe Program has received $260,000 more than it should have from property owners. Of those 2400 people, most are unaware of the blunder. The few who do know are troubled that nobody from the City, their councilman’s office, or the Downtown San Diego Partnership has done anything to alert the citizens and refund their money.

As Casey spoke, Bill Sauls, who sat with his fellow committee members at a dark mahogany table in the plush B Street offices of Downtown San Diego Partnership, closed his eyes and leaned back in his beige leather chair.

After Casey finished her statement, Sauls responded, “When we were first made aware of this, we contacted the City to investigate the situation and report back to us what the status was and what the solutions are. At this point we’re still waiting.”

Casey knows all about waiting. She’s sick of waiting, and she’s sick of the City’s inaction. She says it’s not the $133 she’s owed that upsets her; it’s the unethical way City officials have handled the matter.

The problem started in 2005, when downtown residents voted to continue the Clean and Safe Program another ten years. At that time, the City hired a new consultant, SCI Consulting Group, whose job included determining property assessments. Assessments are based on both the property’s square footage and its linear feet of street frontage. In calculating the fees for property owners in new buildings — those being assessed for the first time — SCI used a different method than had been used in prior years. Instead of using a formula that seems to have involved dividing the entire square footage of a building by the number of units, as had been done in the past, SCI used the parcel size — the actual square footage of each condo. People in older buildings continued to be assessed according to the old calculation. This meant that in the older buildings, most property owners paid the same assessment regardless of the actual square footage of their condos, e.g., the owner of a 1100-square-foot parcel paid just as much as the owner of a 1900-square-foot parcel in the same building. In addition, people in the older buildings were assessed for the common areas, while people in the new buildings were not. Downtown dwellers in older buildings paid anywhere from $32 to $500 more per year than people with same-sized condos in the new buildings.

Sitting on an antique sofa in a modern citrine-colored townhouse in the Cortez neighborhood, Katherine DiFrancesca, a middle-aged woman dressed in a black business suit and wearing a designer scarf, says she paid $507.48 extra per year for four consecutive years. The mistake was due to more than just the calculation method.

DiFrancesca learned of the error back in June 2009 after talking with her friend and neighbor Rita Collier. Collier suggested she take a look at the assessment roll and make sure the square footage on her townhouse was accurate. It wasn’t. The City listed DiFrancesca’s condominium at 12,412 square feet. The actual square footage is just over 2000.

Looking back, DiFrancesca says she never thought to question the amount listed on the tax bill. “I just paid the bills because I figured that it was right. There was never any explanation on the bill. But apparently somebody got the numbers wrong — they transposed numbers or got distracted, who knows.”

Casey, Collier, and DiFrancesca wrote to the mayor’s office and to their councilmember, Kevin Faulconer. They also emailed and phoned Luis Ojeda, a program manager in the City Planning and Community Investment Department, to inform him of the errors. The women never expected that the email exchange between themselves and Ojeda would go on for over seven months.

Ojeda’s first response came in a June 17 email: “I already have assurances that this issue has been corrected for 2009–10 and we will also correct the previous years if they were incorrectly assessed. Typically under this type of circumstance we either issue a refund check to the property owners or apply a credit towards the following assessment year. I will also try to ensure that the other property owners need not file an appeal as we will work making any corrections.”

Casey was pleased to hear that future assessments would be correct and that Ojeda had met with Mayor Sanders and Faulconer. She took Ojeda at his word that the City would issue refunds, and she assumed the City would notify all 2400 residents.

Casey volunteered to work on behalf of everyone in her building. She spent nearly 15 hours a week scrolling through the assessment rolls to see how many of her neighbors had been incorrectly assessed. After she determined that 38 units in her 54-unit building had been affected, Casey searched the entire district, arriving at the estimate of 2400 owners.

Months passed, and there was no word from Ojeda. On September 4, 2009, Casey sent him another email. “I am concerned that I haven’t been told how the refunds are to be made for the incorrect assessments. In June, you stated that either there would be a credit on the following assessment year or a refund check would be issued.”

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Comments

CuddleFish April 21, 2010 @ 4:27 p.m.

Unbelievable. Absolutely unbelievable.

Thanks for this story, Dorian, another great report. You are the best. :)

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oldcitizen April 21, 2010 @ 5:55 p.m.

How do you know if your PBID tax was calculated incorrectly? Look at your property tax bills. If the 2009/2010 tax listed as Downtown PBID is less than the 2008/2009 tax listed as Downtown Business I D, you were probably overcharged for the four years prior to your current tax bill. Kathy Casey

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nostalgic April 22, 2010 @ 8:49 p.m.

Last year, the budget based on these assessments was approved at City Council in June. The people involved announced that they had met with the mayor's office and were satisfied with the outcome. The budget was, accordingly, approved. I don't see how this can be changed. The money has been collected and probably spent. They did not challenge the budget at that time. But, THIS June is coming up! What DID the mayor promise you, anyhow? His name never seems to come up in this.

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HonestGovernment April 22, 2010 @ 10:37 p.m.

Next Tuesday, April 27 (see docket link, Item-106), http://dockets.sandiego.gov/sirepub/pubmtgframe.aspx?meetid=601&doctype=Agenda the City Council will be asked to approve the FY 2011 BID levy assessments on the downtown businesses that pay the Downtown San Diego Partnership to manage the business district taxes. The Parnership also manages the PBID and is paid $72,000 out of the property tax assessments to do so. (As stated in the docket Item-106 supporting document "budget narratives," page 23.)

I suggest that all interested parties owed money show up at the Council hearing and demand what is owed. Perhaps Beth Murray, Bill Anderson, Jay Goldstone, Jerry Sanders, and Luis Ojeda will be there, along with Faulconer, and they can all explain just why the money has not been returned to the tax-paying property owners.

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HonestGovernment April 23, 2010 @ 10:40 a.m.

Thinking about it...it IS possible that the overpaying downtown PBID taxpayers will NEVER see a dime in reimbursement for the overcharges. The reason: their PBID is the ninth member of a group of special property assessments, one of which, a fake MAD, was recently ruled invalid in a lawsuit filed by the assessed property owners. “Invalid” means that the fake MAD was found to be in violation of State law. The State Constitution. It did not pass the smell test of what a real MAD must be and do.

The City has decided to continue levying and collecting the invalid tax anyway, while they appeal. Because they can! And the City continues turning over Golden Hill taxpayers' money to the City’s partner in crime, the Greater Golden Hill Community Development Corporation. The GGH Community Development Corporation unilaterally decides how to waste the ~$500K/year, and is doing a bangup job of finding incredible ways to spend wastefully. Our firestation may have idle equipment, but there are dandy banners screaming “Clean, Green & Safe!” hanging outside the station. Banners that cost tens and tens of thousands of dollars.

The City may be able spin out the appellate process for years, but in the end will be faced with reimbursing thousands of Golden Hill property owners millions of dollars.

I'm thinking that the City is thinking that by reimbursing the overcharged downtown PBID taxpayers, they will be establishing a precedent of reimbursing for wrongly charged special assessments. Oh goody.

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Visduh April 23, 2010 @ 7:45 p.m.

Now where did this miscarriage occur? Was it Philly, New Yawk, Vegas, Chi-town? It could not be a story about San Diego.

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HonestGovernment April 29, 2010 @ 9:02 p.m.

During Tuesday's vote on Item-106, Faulconer recused himself. Anyone know why? Did any of the people to whom CPCI owes money for the PBID overcharge attend and ask to be paid?

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