The City of Chula Vista is considering assuming the responsibility for cleaning up the water and soil pollution after the deconstruction of the South Bay Power Plant. Negotiations on what the City has called a “bifurcated path” have been taking place behind the scenes for several months.
In preparation for a council meeting today, March 22, the City has done two things: called a closed-session meeting to hold power-plant discussions before the open meeting and released a lengthy staff report regarding the negotiations.
Despite Chula Vista’s economic woes, the staff report reveals to residents for the first time the cost of outside attorney fees to conduct power plant negotiations — $221,814. The staff report calls the costs “significant.”
The staff report also attempts to explain the controversial role that David Malcolm has played, and continues to play, in the negotiations. (Malcolm was a former port commissioner who stepped down due to conflict-of-issue problems. He was convicted in 2002 of a felony, which was later expunged.)
Though mayor Cheryl Cox has stated that Malcolm is not a negotiator and is only someone to call up for advice, the staff report says that on approximately October 22, 2010, “David Malcolm outlines a proposal for direct City involvement with demolition and remediation of the [South Bay Power Plant] after discussions he initiates with Dynegy [the company that currently manages the decommissioned power plant]. City staff meets with Malcolm and a formal draft ‘letter of intent’ [LOI] outlining possible terms of this agreement is prepared.”
The staff report seems to contradict itself because it goes on to say about Malcolm’s involvement that “Staff’s understanding is that Mr. Malcolm brought the LOI proposal to the City on his own initiative.” So the question is: did city staff meet with Malcolm and draft the letter of intent or did Malcolm arrive with it in hand?
It is notable that emails provided by former port commissioner Steve Padilla show that one outside attorney hired by the city, John Lorman, forwarded legal material to Malcolm. According to the staff report, the City’s first direct contact and negotiations with Dynegy did not occur until November 15, after drafting the letter of intent in October.
Current efforts on behalf of the staff are “focused on the City’s threshold requirement that Dynegy provide its detailed project cost estimates and hazardous material reports, and that Dynegy fund the cost of the City’s review and analysis thereof.”