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San Diego's CEO or King?

— Mayoral candidates Donna Frye and Jerry Sanders were each asked to sit down for on-the-record interviews. Sanders's campaign press secretary, Scott Maloni, initially agreed to the interview, then called back to say that Sanders would accept only if the questions were submitted in advance and declined the invitation.

Donna Frye sat down with us on October 14.

Why do you want to be mayor?

Because I want to correct this city, and I want to get us back to reality. I live here. I grew up here. I wasn't born here, but I was raised here. And I think that if Jerry Sanders gets elected, nothing's going to change.

Because he doesn't care about the city's problems?

It's not a case that he doesn't care about them. I'm sure he cares about them in his own way. I don't think anything will change because the same people that got us here are the same people that are supporting Jerry Sanders, are the same people that are advising Jerry Sanders, are the same people that are saying, "Let's go issue more debt. Let's go sell off city assets. Let's wait until a court decides." He has John Witt [the former city attorney] advising him at a news conference this week about the illegal benefits! These were the guys that were sitting in the room advising people to vote on underfunding [the pension system], and that's who Sanders uses as his advisor? Are you kidding? It's the same old stuff!

Mike Aguirre

Mike Aguirre says that the councilmembers were essentially involved in a criminal conspiracy. Do you think they were involved in a criminal conspiracy?

Um, it's hard for me to answer that question, because there's a lot of information I don't have. There are certain e-mails that I'm starting to see -- I'd never seen them before. I'll reserve judgment.

So did Mike have information that you didn't have?

No, those documents are starting to be released to the public. Not that Mike Aguirre had any documents that I didn't have; it's that much of this documentation was just not available. It had not been released. The waiver of attorney-client privilege -- some of those documents are starting to come out, and I bet you there's a whole lot more in there! I never had a chance to go through -- however many? -- 60,000 documents? I'd like to!

Do you think it's appropriate for a city attorney to make comments about councilmembers having violated the law?

Yes, I do. I think that the way I read the charter, when we had that meeting this week, it was real clear to me. It says, "has a duty, and an obligation" -- I believe are the words -- "to prosecute." I thought that was fairly clear, what his duties and obligations are.

One of the criticisms of you is that you're too cozy with City Attorney Mike Aguirre.

Oh, whoa!

And that Mike will have too much power over you if you're elected mayor.

[Laughs.]

In fact, we asked him about the cartoon the Municipal Employees Association sent out.

Oh, with me on his lap? I know I looked lovely.

Aguirre said that you've never sat on his lap.

No, I have not sat on his lap to the best of my knowledge. I might've sat on his lap. It's hard to remember. I don't remember, you know. There might have been an occasion when I sat on Michael Aguirre's lap. No, I'm joking!

It's funny. People talk about, they complain because they say, "Well, golly, we need to have a better -- we need to make sure someone has a good relationship with the city attorney so they can get things done and work cooperatively." And then when you work cooperatively with the city attorney so you can get things done, they say, "Well, that's too cozy. 'Cause now they're working cooperatively and they might get something done." And that's really the fear. It's not that it's too cozy. It's that we work well together and will get something done and get to the bottom of it and get the city back on track.

And that is a concern, because a lot of people that have held power for a very long time might not have as much control over what goes on at city hall, and it might, for once in how many years, actually get back to serving the public interest. And wouldn't that be nice? And there's a lot of people that have a lot at stake and a lot to lose if that happens. 'Cause the pie gets split up a certain way now -- well, it would get split up quite a bit different, and the public could get a very large chunk of that again. I don't know, it's just funny to me. It's like people say, "Well, you need to have someone who gets along with him." Well, I do. I like him. We get along well. Do I always agree with him? No. Does he control me? You've got to be kidding me. Do you think anyone controls me? Good luck!

Strong Mayor -- Not City Greeter

Under the new system, the mayor is essentially the CEO of the city. Will you act as a CEO?

Yes.

So you won't hire someone to be CEO?

I won't have a city manager or a COO or a CEO, no. I will have cabinet-level department heads, secretaries; I haven't come up with a name yet.

So you won't have your version of a Ronne Froman [the Red Cross chief whom Sanders, if elected, has tapped as his CEO]?

No. No, thank you. I will actually be the mayor. I'm not going to be the city greeter.

And why should the voters feel that you have the experience to run a $2 billion corporation?

Well, why would they not? It's funny to me. I look at the Harvard-educated Dick Murphys. I look at the -- and who was before Dick?

Susan Golding.

Okay. And I say to myself, "Well, they didn't do so good."

They weren't the CEO of the city.

Oh, baloney. They were still very much in charge when it came to the budget. Don't you kid yourself, and you know it to be a fact as much as I do. The city manager did not just put that budget together by him- or herself. That budget was directed directly by the mayor, and no one's going to tell me otherwise.

I've watched it too many times. The memos used to show up at the end of the budget [hearings], and all of a sudden the mayor would have the memo that would show up for the additional revenues that came in for all the special programs.

You think it's the same type of system, essentially? The same type of authority and control? I mean, the department heads are reporting to you, and...

No, no, no, no, no. The difference is, is that the mayor actually has the ability to hire and fire, where the mayor and the council did not have that ability before. And that makes a huge difference in how things operate.

For example, say somebody comes in and lies to you. Right now, as a member of the city council, or if you're the mayor, then you've got to go to the city manager and say, "Bob just lied to me." And then the city manager would say, "Oh, I'll go talk to Bob." Then the city manager comes back and says, "Bob said he'll never lie again." And that takes three weeks. Then you say, "Okay." Then you're sitting in the council and Bob lies again, and you go through the drill. It's quite a bit different under the strong mayor, where you have the authority to say, "Bob, you lied. Good-bye. See you later. Have a nice day, and have a lovely life."

So the department heads who have lied to you on the council, will they be gone when you're mayor?

Yes.

Can you give us some names?

You know, it was funny, the last time I gave an interview, it was Bruce Herring, and he was gone. He resigned very shortly thereafter.

City Manager Lamont Ewell?

Sponsored
Sponsored

Yes. Well, Lamont's leaving anyway, so Lamont's gone, yes.

What about the planning director? Do you think she should stay?

Who's there now?

Gail Goldberg.

Um, we'll talk about it.

Police chief?

Yeah, keep him for now.

Fire chief?

Absolutely, yes. Jeff Bowman? He stays. No doubt. Honest! Honest!

Water and sewer, Richard Mendes?

Probably [gone].

[Mendes resigned subsequent to this interview.]

Parks and Rec head?

Who is it now?

I don't know.

See, I don't either. They're moving around so much, I don't know. And again, that's today. If I get another dump of documents, I might be giving you a different answer tomorrow.

Do you think that you have any responsibility for the poor financial condition that the city's in?

To the extent that I'm not a very good crystal-ball gazer. I think under the circumstances, I did a good job. Do I wish that I had noticed it sooner? Of course I do. But when I go back -- and I'm not beating myself over the head with a baseball bat, you know, why didn't I -- shoulda, coulda, woulda.

When Diann Shipione showed up that fateful day in November of '02 [the day the council voted to increase pension benefits, which Frye opposed], why I was headed that way was because of the sewer costs, the service study. Because they were trying to shove that into closed session, and I was really focused on that. There were a lot of other issues that I was really focused on too, 'cause we have hundreds of issues that we deal with each week, as you know. So it's hard sometimes. You're doing your best to understand every inch of minutiae, but it's hard.

But on the sewer costs -- the service study -- I knew that that should not be a closed-session meeting, so I had written a letter to Casey Gwinn, and it was November 18, 2002. It's just funny that this stuff came together at that point in time. Essentially, I said, "I don't think we should be in closed session." But the other thing is, I was filing a public records request because I wanted these documents. I couldn't get these documents. So you have an elected official filing a Public Records Act request. So maybe the mood was set by other events, so that when Diann showed up and said what she said, you look around and you say, "I don't think [they're] telling me the truth about the sewer stuff. Are they telling me the truth about this stuff?"

It's hard when you work with people and you really try to rely on the information they're giving you as being accurate, as being factual, as being honest, or at least being half correct! A little correct? In this case, not correct at all! I guess I wasn't that cynical at that time, so.

Donna Frye -- CEO?

You mentioned minutiae, keeping up with minutiae. One of the criticisms of you is that you are too focused on minutiae and that maybe you micromanage. How would you manage a $2 billion corporation and deal with the minutiae?

By hiring people that don't make me read all the minutiae because I can rely on the information they're providing to me, just like I do on the San Diego River Conservancy, where we have an executive officer that puts stuff in a document and it makes sense and it's honest and it's truthful. You hire people that aren't going to lie to you, so I don't have to go, "Gee, does the ordinance match the manager's report? Does the such-and-such match this? Hmmmm, I wonder what they've got in there. This doesn't add up. This document's missing." That's how. It's not by choice. It's almost out of self-preservation of the public. If I don't read them, who will? If the public interest's supposed to be served, aren't I supposed to be reading those documents and making sure that what I'm voting on is actually what I [read]?

Frye Recovery Plan

Tell us about your financial plan.

Essentially, what my comprehensive plan will do is immediately cease to recognize the illegally granted benefits. I can make these types of cuts and adjustments: $34 million in salaries and $14 million in lower health and pension costs (that would be a result of 500 employees gone); the hiring freeze, $12 million; outside consultants and attorneys, $5 million -- I think it's a fairly conservative number I'm using, based on what we've been spending this year, $18-plus million before we'll all be done. Negotiating a management agreement with CalPERS [California Public Employees' Retirement System], to let them start managing the assets, we think we can get about $20 million out of that.

And then, this has been one of my ongoing annoyances, that the City of San Diego is now owed over, oh, golly, $246 million in debt from the redevelopment agencies. And I do not think it's unreasonable to start getting back, on an annual basis, about $20 million a year. That gets us to about $155 million [in annual budget savings].

If you remember, there was a onetime repayment of loans from the redevelopment agency to the city. Part of that money got paid back about two weeks before the city council voted to issue the ballpark bonds. And that $40 million came back from CCDC. It was put into the general fund, and then it immediately was put into the ballpark so that we only had to issue about $168 million in bonds. That was mitigation money. That was supposed to pay for mitigation for downtown for the projects: to pay for the police, to pay for the fire, to pay for the bathrooms and the parks and everything else, and they didn't do it.

I assumed that the pension unfunded liability was about $1.9 billion, the retiree health was at least $500 million, the infrastructure deficit was $2 billion, the unfunded needs were about $500 million, and then I added another, say, $897 million for police and fire, and those are unfunded needs. Then add $600 million in the overstated assets, the Rocky de la Fuente [$95 million judgment against the City].

The bottom line is you've got big numbers. And it's capital-B big numbers, billions. I figured there was at least, at least $4 billion in debt. So I looked at the general fund, which is about, oh, $850 million [annually], and I said, what do we need to do to pay for the pension benefits and to start getting at the infrastructure deficit? What would start stabilizing the general fund? So, I said $250 million [annually]. And then said, "Now go find it."

If we can do these deep budget cuts and we can reduce the pension benefits and get it to a level that we can afford to pay, then we may not need to ask the citizens for more revenue. But you still need to say: How do you get to $250 million and be honest and forthright on how you would do that and what it would look like? So this is what it would look like.

You are considering a sales tax increase?

It is not my -- even though it's mischaracterized -- it is not my first resort. It is something that, if I could put together a comprehensive package that raised no taxes, people would be running to the polls to vote for it. I think that it's a fair way to at least get people to understand what it would look like before I'm elected, not after I'm elected. Be up front from the beginning.

[Frye takes out a piece of paper.] On Jerry Sanders's website, under "Increasing City Revenues." That statement right there about taxes. I printed that this morning. ["When a budget is out of balance, there are really only two possible solutions. Either income must increase or expenditures must decrease. Chapter I of my Fiscal Recovery Plan described reductions in expenditures. The purpose of this chapter is to examine options to increase income."]

And I asked him that question [at a debate] today. I tried to get an answer to that question. Are you going to do it [raise taxes]? Are you not going to do it? And then he started talking about hurricanes and earthquakes and floods. "Well, if there's a hurricane or an earthquake or a flood..." So I still haven't gotten an answer.

What if the voters don't approve new taxes?

Well, there you go. We'll walk you through the worst-case scenario. Let's say the voters say, "No, we're not going to give you any more revenues." Fine. Let's say we lose in court, and the benefits are considered to be legally granted. Then you will just essentially see the city start to have less and less and less services. You will start to see less and less and less employees. You will eventually find the city probably close to bankruptcy. That's what you get. That's the reality of it.

These numbers, these [pension] benefits are not sustainable. And it might not happen for a couple years, and you might be able to cobble together here and there and get some grants, but eventually it's over.

The second thing that would be part of this comprehensive plan -- in that package which would come probably in November of '06 -- would be an elected city auditor-comptroller. And then, when you increase pension benefits, that would require a public vote, like they do in San Francisco. So that would be all one package.

So there'd be, like, cool stuff that some people would like a lot, and there'd be other stuff that some people would like a lot. But it wouldn't be a pick-and-choose; it would be a comprehensive package that says, "Here's how we're going to get whole again, and this is what we're going to do. We're going to make sure that there are measures put in place so that it doesn't happen again, that we can't get into this kind of debt." And I think this does it. Then what we're going to do is make sure that it gets voter approval.

"Illegal" Pension Benefits

Do you support the city attorney's efforts to declare the pension benefits illegal?

The city attorney's efforts to immediately cease recognizing the illegally granted pension benefits for current employees -- not ones that have already retired -- I support that. I think it's the right thing to do. It makes sense to me. If they were illegally granted, then we should not recognize them.

If you do that, if council goes along and approves it, then there will be litigation the next week by the public employees unions.

Absolutely.

And then it's in court for...

It's already in court.

So should the council unilaterally stop paying some of the pension benefits?

Um-hmm. And obviously, Jerry disagrees with that analysis. It's two ways of looking at the world. You know, you get two attorneys in a room and one'll tell you one [thing] and the other will tell you the other. I think this makes sense.

Why do I think it makes more sense? If I were in court and the judge says to me, "So, Donna Frye, so you're having a dispute with this gentleman here." And I go, "Yes. He says I owe him a bunch of money, and I say I don't owe him money." "Well, why'd you keep paying him? Why'd you keep paying him the money? When you got new information where you believed that the benefits were illegally granted, why'd you keep giving them money?" "Well, 'cause I'm just nice. I'm just a nice person."

Criticism of Jerry Sanders's Plan

How else does your plan compare to Sanders's?

Look at Jerry's numbers. He didn't address the [City's] unfunded needs, you know, the 2004 city manager's report on unfunded needs, much of which is to just maintain current service levels, and much of which is probably going to be staffing, and much of which is probably going to be annual costs.

He didn't include police and fire -- the $890 million for public safety, which is also part of the 2004 unfunded needs. He didn't include Rocky de la Fuente [litigation costs], he didn't include the [$600 million] overstatement of city assets, he didn't include much of anything. He didn't even include the amount of money we'd need to pay on the unfunded liability.

So I don't know what he included, but he didn't include much. And that's why the numbers don't add up. Try and add them up, 'cause I'll tell you, I sure tried. You know, it's not a campaign fight. They don't add up.

Obviously a lot of what you're proposing, and what Mr. Sanders is proposing, you'll need to get other people to agree to.

The voters.

You need to get city council to agree to declare the pension benefits illegal.

Well, I'm going to try. And if they don't, then I'm taking it to the voters. I'm going to the voters if I have to. Absolutely. And that's part of my plan.

Are you going to do a ballot initiative?

I would if I needed to. I'm very good at collecting signatures. I've collected a few in my time.

You said you will cut 500 employees. Jerry Sanders says he will cut 10 percent, or about 1000 employees.

The thing is, that's [just] a contingency for him, and it's not a contingency for me.

So who are you going to eliminate?

A lot of management. And there'll be some others. Anybody that was involved in any way, shape, or form with what's been going on.

What departments are not going to be protected by that? Are there any exemptions?

Nope.

So library, parks, police, fire?

I'm going to do everything I can to not reduce staffing in public safety.

Library, parks, management?

Not necessarily. Well, management -- there might be some management, but not just there.

So you don't really know. You're just saying you think you can come up with 500.

I will, yes.

What about the planning department?

Planning department, or real estate assets. Well, planning needs some -- development services needs complete restructuring.

Can you save a lot of money there and still have planning groups?

No. Well, you can have planning groups, but, no, you can't. This is a very harsh budget.

City attorney? Cuts in city attorney? So that will be included as well?

Sure. Nothing's off the table.

You didn't mention that to Mike Aguirre, though?

Well, sure.

I'm just kidding. [Laughs.] He told us he didn't have enough attorneys. Only 150.

The thing is, if you stop doing all this hiring of outside [legal and financial] consultants for $900 an hour, there would be money.

If you cut the Centre City Development Corporation budget by $20 million, won't that affect planning service?

Nooo. Well, $40 million didn't!

But this is annually, not a onetime cut.

But now, you can start also looking at the tax increment [property tax], because we had someone do some research on the law, on redevelopment law. So it's not just the debt. You can look at it as a better sharing of tax increment, which has no effect on their debt, so there's ways to do it.

Pat Shea

What role did Pat Shea have in drafting your financial plan? [Shea, husband to pension-system whistle-blower Diann Shipione, is an attorney who was involved in cleaning up the Orange County bankruptcy.]

A lot! I also had John Gordon, Ross Starr. We got academics, we got CEOs, we had people that are actuaries and people that deal with pensions, Republicans. And Pat Shea, who I adore.

Pat went to school with George W. Bush, your favorite president.

We don't talk about George Bush. I think he's a terrible president, but Pat and I don't talk about that. I mean, I say it to him once in a while, and we have a good laugh over it. It's not about if Pat's a Republican or I'm a Democrat; it's about some really dumb things the city has done, and these are some really smart things we can do to fix it. And it's not a whole lot more difficult than that. You've got a lot of people who are very dedicated, who are really trying to say, "Look, we don't really care about the politics. Here is a way to do it. Something makes sense. You could end the flippin' misery within a year and move on! But let's get real!"

And a gentleman that ran against me, Shawn McMillan, who is a die-hard Republican -- one of the reasons he even got into the mayor's race was because of me, to run against me, the "evil woman." Until he met me. Then all of a sudden that changed, and we've become very good friends.

So there's an honesty that's going on here. And dialogue. Like, do you want to go into debt to pay off your debt? And we said no; we don't think that's good. Do you want to sell off your assets? Do you want to pawn your car to pay for your gasoline? Well, we didn't like that. We thought that was not a good budgeting principle. And so this is what was left. And this took months. This was not something we just one day whipped up. This is stuff that has gone through many, many, many, many, many rounds. And a lot of people have had a lot of input into it.

Some of the ideas in here are from the Performance Institute -- the elected city auditor-comptroller, the labor caps, the votes. Some of it is from the CPI -- the Center on Policy Initiatives -- talking about how much people actually pay towards infrastructure and the large infrastructure deficit. So it's a lot of plans and a lot of ideas that were out there.

When I was debating Sanders this morning at the University Club -- he's fighting so hard to say, "Oh, we have to recognize the illegal benefits." But those also include MP1 [manager's proposal one, in 1996]. And he was police chief and benefited from MP1.

So if your financial plan is adopted, how long will it be before the city is financially sound? Three years, five years, ten years?

I don't know yet. Because a lot of the numbers, we have to have actuaries. And quite frankly, as you and I both know, I mean, you've been around long enough to know that we get some real funny numbers. Look at the stuff from KPMG. You know, just in the short amount of time they've been...they say, "Oh, gee, $600 million in overstatement of assets." So I don't know. The hope would be no longer than 15 years. Obviously, it's just, kind of like when you buy a car. You pay for it over 3 years and you pay a whole lot more, or you can spread it out over 10 years and you pay a little less. You spread it over 15 years...

Bond Debt Versus Pay-As-You-Go Financing

If it takes as long as 15 years, isn't there some benefit in issuing pension bonds?

I have a problem with spending money to pay for debt. I don't know, it doesn't make sense to me that you have debt, so you go borrow more money to pay for the debt that you already have. You have debt to pay for debt. If you're talking about a project where perhaps there's a structure where you look at the life-cycle costs and all that stuff, that may be different. But when I look at the amount of debt that has been incurred by the sewer and the water, it really bothers me because of the way they're spreading out the costs. And then you're watching so much of your [sewer and water] funds being gobbled up with debt service. So it's not a method that I prefer. I kind of like to take care of things as we go and not necessarily shove them off over long periods of time. That's just a general principle that I have when I look at budgeting principles and how I run my business. It's how I run my life.

You don't make the credit-card companies very happy with that philosophy.

I know. I probably have a pretty good credit rating.

Pay for Trash Pickup?

Do you think San Diegans, like residents of other cities, should have to pay for residential trash collection?

No, I don't. I do not think that. You're saying, should people pay more taxes to pick up trash? No.

Because people who rent apartments are paying through their rents, and a lot of homeowners associations are paying and businesses are.

I understand. I know.

Is that the third rail in San Diego politics, the People's Ordinance, which mandates free trash pickup?

No, I don't think it is the third rail. I just think that, you know, if I have to propose a tax, I would rather propose something that is stable and brings in a decent amount of revenues! You can do the TOT tax. You could do a real estate transfer tax. There's a lot of things we could do, but we looked at a lot of them, and this [sales tax] seemed to be the most sensible.

There is the argument that a sales tax is the most regressive.

I know; I read [Arthur] Laffer's comments. The guy who advised Reagan, you know, trickle-down economics.

Won't people go to National City and Carlsbad to buy cars and not San Diego because they'll be paying an extra half-cent in San Diego? Or go to Costco in other cities? Why would they shop in San Diego and pay the extra half-cent in sales tax when they could go...

When they could spend $5 per gallon gas. I mean, they can eat up their gas or... No. I've heard these arguments before. I've watched all these, you know, doomsayers, and the thing is, I'm not even saying we would necessarily have to do this [raise sales tax]! But I'm saying if, if. This is a way to close the deal and get the city healthy again. Yes, I believe it could work.

Privatization

What about competition and/or outsourcing of city services.

I don't like it.

You don't like it?

No! I don't.

You don't think we should have competition at all with the others that...

I'm not saying competition is all -- but I'm sorry, I do not see a savings there. If I could see some legitimate savings -- I haven't seen it. I've seen a lot of the work the contractors do, and quite frankly, we've got to come along behind them and fix it. And then you have to set up a department to oversee the work that the contractors are doing. Why don't we just get competent people and let them do their work? And if they can't do their work, then get someone who can. But I don't think you go around outsourcing and set up an outsourcing department to monitor the outsource work, and then if they don't do it, then you have litigation. I just don't see the math there that's working for me.

What would you do, for example, with the Data Processing Corporation?

A lot of people are saying that they're doing a fairly good job now. It's like the threat of being gone seemed to get them back up and maybe online. And I'll have to sit and look at it.

Isn't that one of the benefits of competition: the threat of being fired increases productivity?

No. How about just keeping your job? And competing for your job but not necessarily competing for the position and not constantly feeling that someone is going to come and take it out of the city altogether. I think that there are things that rightly belong as a government service.

Aren't there things that don't belong as a government service?

Like what?

Printing. The city council just the other day approved remodeling a part of the community concourse for your in-house printing operation and staff. Just an example. The private sector could do it cheaper, more efficiently. You wouldn't pay for overhead.

Okay. Then show me the numbers. I'm not convinced of that. I'm not going to be pushing privatization and outsourcing, is what I'm saying, as part of my plan. It doesn't mean that I wouldn't sometimes say, "Oh, we can save money doing it this way." But I do not philosophically support privatizing government services, no.

Environmental Issues

A lot of people are wondering why your campaign is almost completely focused on financial issues, as opposed to environment, growth, traffic, quality of life, clean water, issues where Donna Frye came from. In every mayoral election in the past 30 years except the last one, those are the issues that voters care about. Do they not care about those issues anymore?

Yeah, they care about those issues, but the thing is, we can't do much to help them with those issues until we deal with all these other issues. The city's going broke. Until you address how you're going to start funding some of this stuff, it doesn't much matter what you talk about.

Based on your polling and on meeting with voters, do you think city finances is the issue the average voter is most concerned about?

Yes, I do. And it's not based on polling. I'll answer in another way too, because it's kind of interesting. I think that if I leave my driveway and I hit a pothole, that's my priority for the day. I think if I go to the library and it's closed, that's my priority for the day. But when people make a decision, they're going to answer, I think, two questions. And I'm talking generally. There are voters that will vote for other reasons and pick a candidate because of their environmental credentials or because of their position on the cross, or whatever it happens to be, but I think overall people are going to say: Who can solve the problem, and who can lead our city out of this mess? And this is what they view as the mess.

And you think voters will be able to understand the differences between your plan and Jerry's plan?

I hope so.

Political Tactics

Are you going to have enough money to get your message across, especially if Sanders goes on TV?

Oh, they're going on TV. It's not if, it's just when. Every campaign I've ever run, I've always been outspent by my opponents. So far, I've managed to get my message out and win my elections. That could change or that could stay constant. And, of course, my hope is that it stays constant. We're pretty good about getting the message out. We're pretty good at grass roots. We're pretty good about explaining things to voters. Hope springs eternal. What can you do? You just do your best, you know. Pretty simple stuff.

Do you expect to see independent expenditures on your behalf?

I don't know. I guess one of the other things I try to do is be very, very cautious, and to the point where I actually -- certain people, I try and avoid talking to them altogether just to try to not get into that. But sure, it'd be nice to see it. I've already seen the ones for Jerry. I've already seen the hit pieces on me from the Republican Party, so sure. I mean, he's been doing it the whole time, so would I like to have a little equity and have someone come up and say, "Hey, we think Donna Frye's pretty cool"? Yeah!

But you can legally coordinate with the Democrats.

I'm just not convinced of that. I'm just not comfortable with that. What can I say? There's just some things I'm not comfortable with. So maybe it is legal. It's just how I feel about it. Would I like people to do stuff? Yeah, [but] I'm dealing with my campaign.

Redevelopment Reform

Does the city need more residences in downtown?

Do I want more density downtown? Yes, I want more density downtown.

And then how do you pay for more services? How do you pay for fire and police?

Tax increment [property taxes]. That's exactly where I'm headed with this... It's to pay for the mitigation caused by the negative environmental impacts generated by the growth and development.

What about other redevelopment areas?

Well, Grantville should never have been established to begin with. That is not a blighted area. That was an abuse of government power, and I don't support it. Simply setting up areas of redevelopment and saying, "Let's draw little circles around certain parts of the community and call it blighted so they can keep the taxes." The city's being sued for that by the county. The county's suing on Grantville, and they should.

How do you reform that process?

You go in there and you audit them. I would like to see that, a performance audit, you know. I mean a numbers audit -- but a good performance audit.

You have to redefine what is public use. Is public use taking the Gran Havana cigar shop [in downtown] and taking away a very beautiful, lucrative business and then giving it to another business owner? Is that public use? I don't think so. It doesn't strike me as public use. Maybe a school or even a park or a road, or something that actually benefits everybody in the public, not just a few people in the public. So I'm trying to get that changed.

You also need to figure out how much money is not going into the general fund. How much are we losing in property tax, and how much money is it pulling out of the general fund to pay for those services? And what are the impacts on the city of San Diego?

What about the downtown library?

No. We don't have the money. That doesn't mean that I don't like libraries. I like libraries. I think they're wonderful things. I love books. I love to read. But right now, we can't even keep Mission Valley open regular hours. So at least let's be able to afford keeping some of our branch libraries open, some of the things that we've already built. Let's get some staffing there before we start adding more things that we can't pay for so we can have more stuff that's not open. I think that's kind of a goofy philosophy.

Council Reelection, June 2006

If you're not elected mayor on November 8...

I'm a city councilmember! [Laughs.]

You have a city council election coming up in June 2006.

That's true. Hey, that's what I do. Elections are my life. I live to campaign!

So you'd get right into running for city council again?

I'd take a couple weeks off.

In the mayoral primary you did really well in the beach areas, not as strongly in Clairemont, which is in your district. Do you think you've been weakened running for mayor? Do you think you'll be as strong?

It's funny. When people take this path or put their lives upside down or pretty much put their family life on hold, and you say, "Does that weaken you?", I don't know. Trying to serve the public, I guess, if that weakens you, I think that the public should be thankful that anybody wants to do it. I don't see it as weakening someone for standing up and saying, "I'm trying to serve you, I'm trying to make sure that we solve the city's problems, and I have a plan to do it, and I'll work real hard and be honest about it." If that weakens a person, so be it. Then I'm weakened.

So you'd absolutely run again?

Sure. Well, you know, never say... [Laughs.] Today I would, yeah. And I don't know about tomorrow. I might get hit by a truck.

Watch those crosswalks.

I do. I look both ways before I cross.

Mayor or King?

[Frye takes out a picture.] I was out at San Diego State University yesterday, and I have a funny little picture. I'll show it to you. We just had fun. Jerry wouldn't debate me so here we had the "Where's Jerry?" [signs being held in the picture].

Is that supposed to be Jerry Sanders, the guy in the chicken suit?

Yeah, someone was in a chicken suit.

So is the San Diego Chicken endorsing you for mayor?

Well, you know, he might. You know who does, though? King Stahlman. King Stahlman had the best commercials of all the commercials during the whole political campaign. He said, "Who needs a mayor when you got a king?" [Laughs.] I like it!

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Reunited, in the round, and onstage in Normal Heights, East Village, Little Italy, Encinitas

— Mayoral candidates Donna Frye and Jerry Sanders were each asked to sit down for on-the-record interviews. Sanders's campaign press secretary, Scott Maloni, initially agreed to the interview, then called back to say that Sanders would accept only if the questions were submitted in advance and declined the invitation.

Donna Frye sat down with us on October 14.

Why do you want to be mayor?

Because I want to correct this city, and I want to get us back to reality. I live here. I grew up here. I wasn't born here, but I was raised here. And I think that if Jerry Sanders gets elected, nothing's going to change.

Because he doesn't care about the city's problems?

It's not a case that he doesn't care about them. I'm sure he cares about them in his own way. I don't think anything will change because the same people that got us here are the same people that are supporting Jerry Sanders, are the same people that are advising Jerry Sanders, are the same people that are saying, "Let's go issue more debt. Let's go sell off city assets. Let's wait until a court decides." He has John Witt [the former city attorney] advising him at a news conference this week about the illegal benefits! These were the guys that were sitting in the room advising people to vote on underfunding [the pension system], and that's who Sanders uses as his advisor? Are you kidding? It's the same old stuff!

Mike Aguirre

Mike Aguirre says that the councilmembers were essentially involved in a criminal conspiracy. Do you think they were involved in a criminal conspiracy?

Um, it's hard for me to answer that question, because there's a lot of information I don't have. There are certain e-mails that I'm starting to see -- I'd never seen them before. I'll reserve judgment.

So did Mike have information that you didn't have?

No, those documents are starting to be released to the public. Not that Mike Aguirre had any documents that I didn't have; it's that much of this documentation was just not available. It had not been released. The waiver of attorney-client privilege -- some of those documents are starting to come out, and I bet you there's a whole lot more in there! I never had a chance to go through -- however many? -- 60,000 documents? I'd like to!

Do you think it's appropriate for a city attorney to make comments about councilmembers having violated the law?

Yes, I do. I think that the way I read the charter, when we had that meeting this week, it was real clear to me. It says, "has a duty, and an obligation" -- I believe are the words -- "to prosecute." I thought that was fairly clear, what his duties and obligations are.

One of the criticisms of you is that you're too cozy with City Attorney Mike Aguirre.

Oh, whoa!

And that Mike will have too much power over you if you're elected mayor.

[Laughs.]

In fact, we asked him about the cartoon the Municipal Employees Association sent out.

Oh, with me on his lap? I know I looked lovely.

Aguirre said that you've never sat on his lap.

No, I have not sat on his lap to the best of my knowledge. I might've sat on his lap. It's hard to remember. I don't remember, you know. There might have been an occasion when I sat on Michael Aguirre's lap. No, I'm joking!

It's funny. People talk about, they complain because they say, "Well, golly, we need to have a better -- we need to make sure someone has a good relationship with the city attorney so they can get things done and work cooperatively." And then when you work cooperatively with the city attorney so you can get things done, they say, "Well, that's too cozy. 'Cause now they're working cooperatively and they might get something done." And that's really the fear. It's not that it's too cozy. It's that we work well together and will get something done and get to the bottom of it and get the city back on track.

And that is a concern, because a lot of people that have held power for a very long time might not have as much control over what goes on at city hall, and it might, for once in how many years, actually get back to serving the public interest. And wouldn't that be nice? And there's a lot of people that have a lot at stake and a lot to lose if that happens. 'Cause the pie gets split up a certain way now -- well, it would get split up quite a bit different, and the public could get a very large chunk of that again. I don't know, it's just funny to me. It's like people say, "Well, you need to have someone who gets along with him." Well, I do. I like him. We get along well. Do I always agree with him? No. Does he control me? You've got to be kidding me. Do you think anyone controls me? Good luck!

Strong Mayor -- Not City Greeter

Under the new system, the mayor is essentially the CEO of the city. Will you act as a CEO?

Yes.

So you won't hire someone to be CEO?

I won't have a city manager or a COO or a CEO, no. I will have cabinet-level department heads, secretaries; I haven't come up with a name yet.

So you won't have your version of a Ronne Froman [the Red Cross chief whom Sanders, if elected, has tapped as his CEO]?

No. No, thank you. I will actually be the mayor. I'm not going to be the city greeter.

And why should the voters feel that you have the experience to run a $2 billion corporation?

Well, why would they not? It's funny to me. I look at the Harvard-educated Dick Murphys. I look at the -- and who was before Dick?

Susan Golding.

Okay. And I say to myself, "Well, they didn't do so good."

They weren't the CEO of the city.

Oh, baloney. They were still very much in charge when it came to the budget. Don't you kid yourself, and you know it to be a fact as much as I do. The city manager did not just put that budget together by him- or herself. That budget was directed directly by the mayor, and no one's going to tell me otherwise.

I've watched it too many times. The memos used to show up at the end of the budget [hearings], and all of a sudden the mayor would have the memo that would show up for the additional revenues that came in for all the special programs.

You think it's the same type of system, essentially? The same type of authority and control? I mean, the department heads are reporting to you, and...

No, no, no, no, no. The difference is, is that the mayor actually has the ability to hire and fire, where the mayor and the council did not have that ability before. And that makes a huge difference in how things operate.

For example, say somebody comes in and lies to you. Right now, as a member of the city council, or if you're the mayor, then you've got to go to the city manager and say, "Bob just lied to me." And then the city manager would say, "Oh, I'll go talk to Bob." Then the city manager comes back and says, "Bob said he'll never lie again." And that takes three weeks. Then you say, "Okay." Then you're sitting in the council and Bob lies again, and you go through the drill. It's quite a bit different under the strong mayor, where you have the authority to say, "Bob, you lied. Good-bye. See you later. Have a nice day, and have a lovely life."

So the department heads who have lied to you on the council, will they be gone when you're mayor?

Yes.

Can you give us some names?

You know, it was funny, the last time I gave an interview, it was Bruce Herring, and he was gone. He resigned very shortly thereafter.

City Manager Lamont Ewell?

Sponsored
Sponsored

Yes. Well, Lamont's leaving anyway, so Lamont's gone, yes.

What about the planning director? Do you think she should stay?

Who's there now?

Gail Goldberg.

Um, we'll talk about it.

Police chief?

Yeah, keep him for now.

Fire chief?

Absolutely, yes. Jeff Bowman? He stays. No doubt. Honest! Honest!

Water and sewer, Richard Mendes?

Probably [gone].

[Mendes resigned subsequent to this interview.]

Parks and Rec head?

Who is it now?

I don't know.

See, I don't either. They're moving around so much, I don't know. And again, that's today. If I get another dump of documents, I might be giving you a different answer tomorrow.

Do you think that you have any responsibility for the poor financial condition that the city's in?

To the extent that I'm not a very good crystal-ball gazer. I think under the circumstances, I did a good job. Do I wish that I had noticed it sooner? Of course I do. But when I go back -- and I'm not beating myself over the head with a baseball bat, you know, why didn't I -- shoulda, coulda, woulda.

When Diann Shipione showed up that fateful day in November of '02 [the day the council voted to increase pension benefits, which Frye opposed], why I was headed that way was because of the sewer costs, the service study. Because they were trying to shove that into closed session, and I was really focused on that. There were a lot of other issues that I was really focused on too, 'cause we have hundreds of issues that we deal with each week, as you know. So it's hard sometimes. You're doing your best to understand every inch of minutiae, but it's hard.

But on the sewer costs -- the service study -- I knew that that should not be a closed-session meeting, so I had written a letter to Casey Gwinn, and it was November 18, 2002. It's just funny that this stuff came together at that point in time. Essentially, I said, "I don't think we should be in closed session." But the other thing is, I was filing a public records request because I wanted these documents. I couldn't get these documents. So you have an elected official filing a Public Records Act request. So maybe the mood was set by other events, so that when Diann showed up and said what she said, you look around and you say, "I don't think [they're] telling me the truth about the sewer stuff. Are they telling me the truth about this stuff?"

It's hard when you work with people and you really try to rely on the information they're giving you as being accurate, as being factual, as being honest, or at least being half correct! A little correct? In this case, not correct at all! I guess I wasn't that cynical at that time, so.

Donna Frye -- CEO?

You mentioned minutiae, keeping up with minutiae. One of the criticisms of you is that you are too focused on minutiae and that maybe you micromanage. How would you manage a $2 billion corporation and deal with the minutiae?

By hiring people that don't make me read all the minutiae because I can rely on the information they're providing to me, just like I do on the San Diego River Conservancy, where we have an executive officer that puts stuff in a document and it makes sense and it's honest and it's truthful. You hire people that aren't going to lie to you, so I don't have to go, "Gee, does the ordinance match the manager's report? Does the such-and-such match this? Hmmmm, I wonder what they've got in there. This doesn't add up. This document's missing." That's how. It's not by choice. It's almost out of self-preservation of the public. If I don't read them, who will? If the public interest's supposed to be served, aren't I supposed to be reading those documents and making sure that what I'm voting on is actually what I [read]?

Frye Recovery Plan

Tell us about your financial plan.

Essentially, what my comprehensive plan will do is immediately cease to recognize the illegally granted benefits. I can make these types of cuts and adjustments: $34 million in salaries and $14 million in lower health and pension costs (that would be a result of 500 employees gone); the hiring freeze, $12 million; outside consultants and attorneys, $5 million -- I think it's a fairly conservative number I'm using, based on what we've been spending this year, $18-plus million before we'll all be done. Negotiating a management agreement with CalPERS [California Public Employees' Retirement System], to let them start managing the assets, we think we can get about $20 million out of that.

And then, this has been one of my ongoing annoyances, that the City of San Diego is now owed over, oh, golly, $246 million in debt from the redevelopment agencies. And I do not think it's unreasonable to start getting back, on an annual basis, about $20 million a year. That gets us to about $155 million [in annual budget savings].

If you remember, there was a onetime repayment of loans from the redevelopment agency to the city. Part of that money got paid back about two weeks before the city council voted to issue the ballpark bonds. And that $40 million came back from CCDC. It was put into the general fund, and then it immediately was put into the ballpark so that we only had to issue about $168 million in bonds. That was mitigation money. That was supposed to pay for mitigation for downtown for the projects: to pay for the police, to pay for the fire, to pay for the bathrooms and the parks and everything else, and they didn't do it.

I assumed that the pension unfunded liability was about $1.9 billion, the retiree health was at least $500 million, the infrastructure deficit was $2 billion, the unfunded needs were about $500 million, and then I added another, say, $897 million for police and fire, and those are unfunded needs. Then add $600 million in the overstated assets, the Rocky de la Fuente [$95 million judgment against the City].

The bottom line is you've got big numbers. And it's capital-B big numbers, billions. I figured there was at least, at least $4 billion in debt. So I looked at the general fund, which is about, oh, $850 million [annually], and I said, what do we need to do to pay for the pension benefits and to start getting at the infrastructure deficit? What would start stabilizing the general fund? So, I said $250 million [annually]. And then said, "Now go find it."

If we can do these deep budget cuts and we can reduce the pension benefits and get it to a level that we can afford to pay, then we may not need to ask the citizens for more revenue. But you still need to say: How do you get to $250 million and be honest and forthright on how you would do that and what it would look like? So this is what it would look like.

You are considering a sales tax increase?

It is not my -- even though it's mischaracterized -- it is not my first resort. It is something that, if I could put together a comprehensive package that raised no taxes, people would be running to the polls to vote for it. I think that it's a fair way to at least get people to understand what it would look like before I'm elected, not after I'm elected. Be up front from the beginning.

[Frye takes out a piece of paper.] On Jerry Sanders's website, under "Increasing City Revenues." That statement right there about taxes. I printed that this morning. ["When a budget is out of balance, there are really only two possible solutions. Either income must increase or expenditures must decrease. Chapter I of my Fiscal Recovery Plan described reductions in expenditures. The purpose of this chapter is to examine options to increase income."]

And I asked him that question [at a debate] today. I tried to get an answer to that question. Are you going to do it [raise taxes]? Are you not going to do it? And then he started talking about hurricanes and earthquakes and floods. "Well, if there's a hurricane or an earthquake or a flood..." So I still haven't gotten an answer.

What if the voters don't approve new taxes?

Well, there you go. We'll walk you through the worst-case scenario. Let's say the voters say, "No, we're not going to give you any more revenues." Fine. Let's say we lose in court, and the benefits are considered to be legally granted. Then you will just essentially see the city start to have less and less and less services. You will start to see less and less and less employees. You will eventually find the city probably close to bankruptcy. That's what you get. That's the reality of it.

These numbers, these [pension] benefits are not sustainable. And it might not happen for a couple years, and you might be able to cobble together here and there and get some grants, but eventually it's over.

The second thing that would be part of this comprehensive plan -- in that package which would come probably in November of '06 -- would be an elected city auditor-comptroller. And then, when you increase pension benefits, that would require a public vote, like they do in San Francisco. So that would be all one package.

So there'd be, like, cool stuff that some people would like a lot, and there'd be other stuff that some people would like a lot. But it wouldn't be a pick-and-choose; it would be a comprehensive package that says, "Here's how we're going to get whole again, and this is what we're going to do. We're going to make sure that there are measures put in place so that it doesn't happen again, that we can't get into this kind of debt." And I think this does it. Then what we're going to do is make sure that it gets voter approval.

"Illegal" Pension Benefits

Do you support the city attorney's efforts to declare the pension benefits illegal?

The city attorney's efforts to immediately cease recognizing the illegally granted pension benefits for current employees -- not ones that have already retired -- I support that. I think it's the right thing to do. It makes sense to me. If they were illegally granted, then we should not recognize them.

If you do that, if council goes along and approves it, then there will be litigation the next week by the public employees unions.

Absolutely.

And then it's in court for...

It's already in court.

So should the council unilaterally stop paying some of the pension benefits?

Um-hmm. And obviously, Jerry disagrees with that analysis. It's two ways of looking at the world. You know, you get two attorneys in a room and one'll tell you one [thing] and the other will tell you the other. I think this makes sense.

Why do I think it makes more sense? If I were in court and the judge says to me, "So, Donna Frye, so you're having a dispute with this gentleman here." And I go, "Yes. He says I owe him a bunch of money, and I say I don't owe him money." "Well, why'd you keep paying him? Why'd you keep paying him the money? When you got new information where you believed that the benefits were illegally granted, why'd you keep giving them money?" "Well, 'cause I'm just nice. I'm just a nice person."

Criticism of Jerry Sanders's Plan

How else does your plan compare to Sanders's?

Look at Jerry's numbers. He didn't address the [City's] unfunded needs, you know, the 2004 city manager's report on unfunded needs, much of which is to just maintain current service levels, and much of which is probably going to be staffing, and much of which is probably going to be annual costs.

He didn't include police and fire -- the $890 million for public safety, which is also part of the 2004 unfunded needs. He didn't include Rocky de la Fuente [litigation costs], he didn't include the [$600 million] overstatement of city assets, he didn't include much of anything. He didn't even include the amount of money we'd need to pay on the unfunded liability.

So I don't know what he included, but he didn't include much. And that's why the numbers don't add up. Try and add them up, 'cause I'll tell you, I sure tried. You know, it's not a campaign fight. They don't add up.

Obviously a lot of what you're proposing, and what Mr. Sanders is proposing, you'll need to get other people to agree to.

The voters.

You need to get city council to agree to declare the pension benefits illegal.

Well, I'm going to try. And if they don't, then I'm taking it to the voters. I'm going to the voters if I have to. Absolutely. And that's part of my plan.

Are you going to do a ballot initiative?

I would if I needed to. I'm very good at collecting signatures. I've collected a few in my time.

You said you will cut 500 employees. Jerry Sanders says he will cut 10 percent, or about 1000 employees.

The thing is, that's [just] a contingency for him, and it's not a contingency for me.

So who are you going to eliminate?

A lot of management. And there'll be some others. Anybody that was involved in any way, shape, or form with what's been going on.

What departments are not going to be protected by that? Are there any exemptions?

Nope.

So library, parks, police, fire?

I'm going to do everything I can to not reduce staffing in public safety.

Library, parks, management?

Not necessarily. Well, management -- there might be some management, but not just there.

So you don't really know. You're just saying you think you can come up with 500.

I will, yes.

What about the planning department?

Planning department, or real estate assets. Well, planning needs some -- development services needs complete restructuring.

Can you save a lot of money there and still have planning groups?

No. Well, you can have planning groups, but, no, you can't. This is a very harsh budget.

City attorney? Cuts in city attorney? So that will be included as well?

Sure. Nothing's off the table.

You didn't mention that to Mike Aguirre, though?

Well, sure.

I'm just kidding. [Laughs.] He told us he didn't have enough attorneys. Only 150.

The thing is, if you stop doing all this hiring of outside [legal and financial] consultants for $900 an hour, there would be money.

If you cut the Centre City Development Corporation budget by $20 million, won't that affect planning service?

Nooo. Well, $40 million didn't!

But this is annually, not a onetime cut.

But now, you can start also looking at the tax increment [property tax], because we had someone do some research on the law, on redevelopment law. So it's not just the debt. You can look at it as a better sharing of tax increment, which has no effect on their debt, so there's ways to do it.

Pat Shea

What role did Pat Shea have in drafting your financial plan? [Shea, husband to pension-system whistle-blower Diann Shipione, is an attorney who was involved in cleaning up the Orange County bankruptcy.]

A lot! I also had John Gordon, Ross Starr. We got academics, we got CEOs, we had people that are actuaries and people that deal with pensions, Republicans. And Pat Shea, who I adore.

Pat went to school with George W. Bush, your favorite president.

We don't talk about George Bush. I think he's a terrible president, but Pat and I don't talk about that. I mean, I say it to him once in a while, and we have a good laugh over it. It's not about if Pat's a Republican or I'm a Democrat; it's about some really dumb things the city has done, and these are some really smart things we can do to fix it. And it's not a whole lot more difficult than that. You've got a lot of people who are very dedicated, who are really trying to say, "Look, we don't really care about the politics. Here is a way to do it. Something makes sense. You could end the flippin' misery within a year and move on! But let's get real!"

And a gentleman that ran against me, Shawn McMillan, who is a die-hard Republican -- one of the reasons he even got into the mayor's race was because of me, to run against me, the "evil woman." Until he met me. Then all of a sudden that changed, and we've become very good friends.

So there's an honesty that's going on here. And dialogue. Like, do you want to go into debt to pay off your debt? And we said no; we don't think that's good. Do you want to sell off your assets? Do you want to pawn your car to pay for your gasoline? Well, we didn't like that. We thought that was not a good budgeting principle. And so this is what was left. And this took months. This was not something we just one day whipped up. This is stuff that has gone through many, many, many, many, many rounds. And a lot of people have had a lot of input into it.

Some of the ideas in here are from the Performance Institute -- the elected city auditor-comptroller, the labor caps, the votes. Some of it is from the CPI -- the Center on Policy Initiatives -- talking about how much people actually pay towards infrastructure and the large infrastructure deficit. So it's a lot of plans and a lot of ideas that were out there.

When I was debating Sanders this morning at the University Club -- he's fighting so hard to say, "Oh, we have to recognize the illegal benefits." But those also include MP1 [manager's proposal one, in 1996]. And he was police chief and benefited from MP1.

So if your financial plan is adopted, how long will it be before the city is financially sound? Three years, five years, ten years?

I don't know yet. Because a lot of the numbers, we have to have actuaries. And quite frankly, as you and I both know, I mean, you've been around long enough to know that we get some real funny numbers. Look at the stuff from KPMG. You know, just in the short amount of time they've been...they say, "Oh, gee, $600 million in overstatement of assets." So I don't know. The hope would be no longer than 15 years. Obviously, it's just, kind of like when you buy a car. You pay for it over 3 years and you pay a whole lot more, or you can spread it out over 10 years and you pay a little less. You spread it over 15 years...

Bond Debt Versus Pay-As-You-Go Financing

If it takes as long as 15 years, isn't there some benefit in issuing pension bonds?

I have a problem with spending money to pay for debt. I don't know, it doesn't make sense to me that you have debt, so you go borrow more money to pay for the debt that you already have. You have debt to pay for debt. If you're talking about a project where perhaps there's a structure where you look at the life-cycle costs and all that stuff, that may be different. But when I look at the amount of debt that has been incurred by the sewer and the water, it really bothers me because of the way they're spreading out the costs. And then you're watching so much of your [sewer and water] funds being gobbled up with debt service. So it's not a method that I prefer. I kind of like to take care of things as we go and not necessarily shove them off over long periods of time. That's just a general principle that I have when I look at budgeting principles and how I run my business. It's how I run my life.

You don't make the credit-card companies very happy with that philosophy.

I know. I probably have a pretty good credit rating.

Pay for Trash Pickup?

Do you think San Diegans, like residents of other cities, should have to pay for residential trash collection?

No, I don't. I do not think that. You're saying, should people pay more taxes to pick up trash? No.

Because people who rent apartments are paying through their rents, and a lot of homeowners associations are paying and businesses are.

I understand. I know.

Is that the third rail in San Diego politics, the People's Ordinance, which mandates free trash pickup?

No, I don't think it is the third rail. I just think that, you know, if I have to propose a tax, I would rather propose something that is stable and brings in a decent amount of revenues! You can do the TOT tax. You could do a real estate transfer tax. There's a lot of things we could do, but we looked at a lot of them, and this [sales tax] seemed to be the most sensible.

There is the argument that a sales tax is the most regressive.

I know; I read [Arthur] Laffer's comments. The guy who advised Reagan, you know, trickle-down economics.

Won't people go to National City and Carlsbad to buy cars and not San Diego because they'll be paying an extra half-cent in San Diego? Or go to Costco in other cities? Why would they shop in San Diego and pay the extra half-cent in sales tax when they could go...

When they could spend $5 per gallon gas. I mean, they can eat up their gas or... No. I've heard these arguments before. I've watched all these, you know, doomsayers, and the thing is, I'm not even saying we would necessarily have to do this [raise sales tax]! But I'm saying if, if. This is a way to close the deal and get the city healthy again. Yes, I believe it could work.

Privatization

What about competition and/or outsourcing of city services.

I don't like it.

You don't like it?

No! I don't.

You don't think we should have competition at all with the others that...

I'm not saying competition is all -- but I'm sorry, I do not see a savings there. If I could see some legitimate savings -- I haven't seen it. I've seen a lot of the work the contractors do, and quite frankly, we've got to come along behind them and fix it. And then you have to set up a department to oversee the work that the contractors are doing. Why don't we just get competent people and let them do their work? And if they can't do their work, then get someone who can. But I don't think you go around outsourcing and set up an outsourcing department to monitor the outsource work, and then if they don't do it, then you have litigation. I just don't see the math there that's working for me.

What would you do, for example, with the Data Processing Corporation?

A lot of people are saying that they're doing a fairly good job now. It's like the threat of being gone seemed to get them back up and maybe online. And I'll have to sit and look at it.

Isn't that one of the benefits of competition: the threat of being fired increases productivity?

No. How about just keeping your job? And competing for your job but not necessarily competing for the position and not constantly feeling that someone is going to come and take it out of the city altogether. I think that there are things that rightly belong as a government service.

Aren't there things that don't belong as a government service?

Like what?

Printing. The city council just the other day approved remodeling a part of the community concourse for your in-house printing operation and staff. Just an example. The private sector could do it cheaper, more efficiently. You wouldn't pay for overhead.

Okay. Then show me the numbers. I'm not convinced of that. I'm not going to be pushing privatization and outsourcing, is what I'm saying, as part of my plan. It doesn't mean that I wouldn't sometimes say, "Oh, we can save money doing it this way." But I do not philosophically support privatizing government services, no.

Environmental Issues

A lot of people are wondering why your campaign is almost completely focused on financial issues, as opposed to environment, growth, traffic, quality of life, clean water, issues where Donna Frye came from. In every mayoral election in the past 30 years except the last one, those are the issues that voters care about. Do they not care about those issues anymore?

Yeah, they care about those issues, but the thing is, we can't do much to help them with those issues until we deal with all these other issues. The city's going broke. Until you address how you're going to start funding some of this stuff, it doesn't much matter what you talk about.

Based on your polling and on meeting with voters, do you think city finances is the issue the average voter is most concerned about?

Yes, I do. And it's not based on polling. I'll answer in another way too, because it's kind of interesting. I think that if I leave my driveway and I hit a pothole, that's my priority for the day. I think if I go to the library and it's closed, that's my priority for the day. But when people make a decision, they're going to answer, I think, two questions. And I'm talking generally. There are voters that will vote for other reasons and pick a candidate because of their environmental credentials or because of their position on the cross, or whatever it happens to be, but I think overall people are going to say: Who can solve the problem, and who can lead our city out of this mess? And this is what they view as the mess.

And you think voters will be able to understand the differences between your plan and Jerry's plan?

I hope so.

Political Tactics

Are you going to have enough money to get your message across, especially if Sanders goes on TV?

Oh, they're going on TV. It's not if, it's just when. Every campaign I've ever run, I've always been outspent by my opponents. So far, I've managed to get my message out and win my elections. That could change or that could stay constant. And, of course, my hope is that it stays constant. We're pretty good about getting the message out. We're pretty good at grass roots. We're pretty good about explaining things to voters. Hope springs eternal. What can you do? You just do your best, you know. Pretty simple stuff.

Do you expect to see independent expenditures on your behalf?

I don't know. I guess one of the other things I try to do is be very, very cautious, and to the point where I actually -- certain people, I try and avoid talking to them altogether just to try to not get into that. But sure, it'd be nice to see it. I've already seen the ones for Jerry. I've already seen the hit pieces on me from the Republican Party, so sure. I mean, he's been doing it the whole time, so would I like to have a little equity and have someone come up and say, "Hey, we think Donna Frye's pretty cool"? Yeah!

But you can legally coordinate with the Democrats.

I'm just not convinced of that. I'm just not comfortable with that. What can I say? There's just some things I'm not comfortable with. So maybe it is legal. It's just how I feel about it. Would I like people to do stuff? Yeah, [but] I'm dealing with my campaign.

Redevelopment Reform

Does the city need more residences in downtown?

Do I want more density downtown? Yes, I want more density downtown.

And then how do you pay for more services? How do you pay for fire and police?

Tax increment [property taxes]. That's exactly where I'm headed with this... It's to pay for the mitigation caused by the negative environmental impacts generated by the growth and development.

What about other redevelopment areas?

Well, Grantville should never have been established to begin with. That is not a blighted area. That was an abuse of government power, and I don't support it. Simply setting up areas of redevelopment and saying, "Let's draw little circles around certain parts of the community and call it blighted so they can keep the taxes." The city's being sued for that by the county. The county's suing on Grantville, and they should.

How do you reform that process?

You go in there and you audit them. I would like to see that, a performance audit, you know. I mean a numbers audit -- but a good performance audit.

You have to redefine what is public use. Is public use taking the Gran Havana cigar shop [in downtown] and taking away a very beautiful, lucrative business and then giving it to another business owner? Is that public use? I don't think so. It doesn't strike me as public use. Maybe a school or even a park or a road, or something that actually benefits everybody in the public, not just a few people in the public. So I'm trying to get that changed.

You also need to figure out how much money is not going into the general fund. How much are we losing in property tax, and how much money is it pulling out of the general fund to pay for those services? And what are the impacts on the city of San Diego?

What about the downtown library?

No. We don't have the money. That doesn't mean that I don't like libraries. I like libraries. I think they're wonderful things. I love books. I love to read. But right now, we can't even keep Mission Valley open regular hours. So at least let's be able to afford keeping some of our branch libraries open, some of the things that we've already built. Let's get some staffing there before we start adding more things that we can't pay for so we can have more stuff that's not open. I think that's kind of a goofy philosophy.

Council Reelection, June 2006

If you're not elected mayor on November 8...

I'm a city councilmember! [Laughs.]

You have a city council election coming up in June 2006.

That's true. Hey, that's what I do. Elections are my life. I live to campaign!

So you'd get right into running for city council again?

I'd take a couple weeks off.

In the mayoral primary you did really well in the beach areas, not as strongly in Clairemont, which is in your district. Do you think you've been weakened running for mayor? Do you think you'll be as strong?

It's funny. When people take this path or put their lives upside down or pretty much put their family life on hold, and you say, "Does that weaken you?", I don't know. Trying to serve the public, I guess, if that weakens you, I think that the public should be thankful that anybody wants to do it. I don't see it as weakening someone for standing up and saying, "I'm trying to serve you, I'm trying to make sure that we solve the city's problems, and I have a plan to do it, and I'll work real hard and be honest about it." If that weakens a person, so be it. Then I'm weakened.

So you'd absolutely run again?

Sure. Well, you know, never say... [Laughs.] Today I would, yeah. And I don't know about tomorrow. I might get hit by a truck.

Watch those crosswalks.

I do. I look both ways before I cross.

Mayor or King?

[Frye takes out a picture.] I was out at San Diego State University yesterday, and I have a funny little picture. I'll show it to you. We just had fun. Jerry wouldn't debate me so here we had the "Where's Jerry?" [signs being held in the picture].

Is that supposed to be Jerry Sanders, the guy in the chicken suit?

Yeah, someone was in a chicken suit.

So is the San Diego Chicken endorsing you for mayor?

Well, you know, he might. You know who does, though? King Stahlman. King Stahlman had the best commercials of all the commercials during the whole political campaign. He said, "Who needs a mayor when you got a king?" [Laughs.] I like it!

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