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The City of San Diego today announced that it will hold a lottery. The winner gets the Coronado Bay Bridge. Well, San Diego didn't really say that, but it did the next most disingenuous thing: it said with a straight face that a new $50 million computer system has prevented the City from balancing its books. The annual audit will be delayed for at least six months past the December deadline, according to a story this evening (Nov. 16) on the Union-Tribune website. Last week, the mayor's office pulled bonds for refinancing the convention center. "Other bond refinancings are up in the air," says the U-T. Jay Goldstone, the City's chief operating officer, insisted that the half-year delay in the audit and the suspension of bond offerings would have no impact on the City's ability to sell bonds. (It's understood that Goldstone has won the Coronado bridge lottery and has announced there will be a $5 toll going both directions.)

Rumors about the bond cancellations -- and the City's attempt to blame them on the computers -- arose this afternoon. I kept watching the City's website. It never showed up. If the City posted the news, it was buried -- just as the U-T post was buried. "We will disclose this," the U-T quoted Goldstone as saying. Where? When?

San Diego has already been disciplined by the Securities and Exchange Commission for failing to make important disclosures in bond documents. "They [City officials] do not have to worry about the district attorney or U.S. attorney's office [because of inherent laxity] but does have to worry about the SEC," says Mike Aguirre, former city attorney. He was told that the City made some kind of disclosure at an open meeting. "But they didn't disclose it in a timely way," he says. "This also means the City is not going to be making the required disclosures to bondholders, required under the law."

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Comments

Visduh Nov. 16, 2010 @ 8:15 p.m.

This has to be the lamest excuse since the schoolkid came up with "The dog ate my homework." Blaming failings on those ultra-mysterious and impossible-to-fathom computers was commonplace twenty-five years ago. But now? Oh, come now! Has the city filed a lawsuit against the supplier of the system? Put on a crash effort to get it running at capacity? Anything? Of course not. Don't make me laugh.

But if this failure of the new system to stay current is having no effect on bond sales, why was this one delayed? Oh, if it has no effect except to delay the bond sales, that delay IS an effect.

Noses are a growing at city hall. Some must rival power poles in size and length.

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Don Bauder Nov. 16, 2010 @ 9:39 p.m.

Trouble is, the noses at City Hall were already so long that the honchos couldn't squeeze through doorways. I agree: citizens should demand to know what's wrong with the computers and demand to know why the City hasn't sued vendors for substantial reimbursement. It won't happen. Six months delay over a computer glitch? Come now. It would be instructive for everyone to read the Union-Tribune's extremely soft treatment of this story. The paper assumes that the alibi is true; there are only hints of skepticism. That also points to what is very seriously wrong in San Diego. Best, Don Bauder

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johnsd Nov. 16, 2010 @ 11:58 p.m.

How convenient that the audit is the city function most affected by the new computer system. How can the city continue to function if it does not "know" its financial situation? You would think that correcting this computer problem is urgent and would be fixed as soon as possible. What happened to the existing "antiquated" computer system? Why did the city not continue to operate the old system until the new one was functioning properly?

This is typical of government. "Mistakes were made" and no one, absolutely no one, in the bureaucracy is held accountable for mistakes, and/or incompetence, and/or corruption.

I thought the toll on the Coronado Bridge was to pay off the bonds and maintenance. Government is desperate to maintain its high cost structure and will do everything possible to extort money from the public. At $5 each way, I will take the scenic route through the Silver Strand for at least one leg of my next trip to Coronado. It may be more difficult for those who work at North Island to avoid the bridge.

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Don Bauder Nov. 17, 2010 @ 6:43 a.m.

Yes, it is very convenient that the purported computer problems somehow affected the calculation of the budget. And how convenient that the problem was not fixed months ago. And not revealed before the Nov. 2 election. What's appalling is that City officials apparently believe they can get away with this. There is one bright side: the responses to the U-T's coverup are clearly on the cynical side. Again, I urge people to read the U-T's story about this. It tells you all you need to know about how things work -- (don't work, really) -- in San Diego. Best, Don Bauder

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laplayaheritage Nov. 17, 2010 @ 5 a.m.

In its Bond Disclosure, the City allows public funds to be channeled to unknown beneficiaries hiding behind Delaware LLC status, which hides the names of owners. The City does this for public bond projects including: Ballpark Village LLC, McMillin NTC LLC and their 22 sub-Delaware partners, etc.

http://docs.sandiego.gov/citycharter/Article%20XIV.pdf

See Page 5 for City Charter Section 225 - Mandatory Disclosure of Business Interests.

"No right, title or interest in the City's real or personal property, nor any right, title or interest arising out of a contract, or lease, may be granted or bargained,,, unless the person applying or bargaining therefore makes a full and complete Disclosure of the name and identity of any and all person directly or indirectly involved in the application or proposed transaction and the precise nature of all interest of persons therein."

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Don Bauder Nov. 17, 2010 @ 6:47 a.m.

Demand a full disclosure of the contractors and subcontractors in this purported computer glitch, and also the names of those who were hired to fix it. It is important to know WHEN they were hired. When did the City supposedly conclude that it could not get its audit out and would have to suspend bond sales? Why was this not revealed publicly immediately? Who made the decision not to reveal it? There are many questions. Best, Don Bauder

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a2zresource Nov. 18, 2010 @ 6:47 p.m.

It appears that in a city agenda item supporting document earlier this year, the Independent Budget Analyst offered that she had not yet used the new City SAP package but would probably get around to using it by "late summer"? The city council has had its October training session from Fitch Ratings on debt servicing, but the system that tracks exactly what debt there is cannot be used to inventory those debts for the review of the council or the council's report to the electors of San Diego.

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SurfPuppy619 Nov. 17, 2010 @ 8:33 a.m.

LOL..and the city negligence hits just keep on coming............

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Don Bauder Nov. 17, 2010 @ 8:57 a.m.

Negligence? Negligence?? C'mon, SurfPup, you are getting soft. Best, Don Bauder

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SurfPuppy619 Nov. 17, 2010 @ 5:47 p.m.

You're correct, my bad

It is willful and intentional fraud.

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