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At the conclusion of the public hearing process, and conditional upon “weighted” support of the business or property owners, the city council may vote to levy an assessment on affected businesses or property owners to fund the special benefit services articulated in the management plan. The city clerk is in charge of tallying all returned ballots and making a report to the city council on the support or opposition from the mail balloting procedure -- New City America has nothing to do with this reporting process.

Historically, the vote sometimes disapproves of the formation of a district in California. In the event that the vote favors the formation of a district, City staff prepares a recommendation to the City approving the formation. After receipt of this report, the city council then independently votes to determine whether a maintenance assessment or business improvement district should be formed. Thus, as noted above, the ultimate decision as to the formation of a district lies with the city council and not with me or New City America.

There are numerous instances in which independent decision-making determines the advisability of the formation of such a district, including (1) the lack of interest by property owners, (2) a vote by concerned parties against formation of such a district, and (3) rejection by the city council. All of these situations involve independent objective criteria over which neither I nor New City America exercise specific control.

In the event that the city council passes a resolution for the formation of a maintenance assessment district or business improvement district, then the next step is for members of the newly formed district to create a nonprofit corporation for the management of the district. This independent nonprofit corporation (which I have never been a voting member of) then calls for the election of a board of directors, and the board of directors is charged, according to the bylaws of the district, with management of the corporation.

As noted previously, I did not sit on the board of directors of the North Bay Association or, for that matter, any district I have formed. I did not ever vote in connection with any issue presented to that board. The board of directors that is elected by the interested parties in the district operates the management of the corporation. The board then makes determinations with whom to enter into private contracts, subject to the approval of the City of San Diego. Thus, I was not sitting on the board, never determined the membership in the board, and never had any say in the vote by the board as to whether or not I should receive a contract.

Alleged Conflict of Interest and Attorney General’s Opinion:

Kessler first started claiming that this process violated the conflict-of-interest law only after having a personal disagreement with me, losing his position, and heatedly vowing to take vengeance against me. We sent Mr. Bauder a transcript of this threat, which he published, but made no connection that everything that followed that threat was, in fact, implementation of his goal to discredit me and my work. Immediately after this recorded claim of conflict of interest by Mr. Kessler, I made every effort to demonstrate that Kessler was wrong.

I contacted the City Ethics Commission and requested that they research and issue an opinion on this issue. They declined, advising me that their procedures did not contemplate such opinions.

I then contacted the district attorney prosecuting the pension fund conflict-of-interest case, Mr. Steve Robinson, and sought an opinion from their office evaluating the law, only again to be told that their office did not issue such opinions.

Finally, I contacted the State Attorney General’s Office and learned of a procedure to have someone evaluate my circumstances and render an opinion. Ultimately, in October 2005, after months of waiting, the Attorney General’s Office issued a written opinion concluding, contrary to Kessler’s, and later Detective Vile’s and Bauder’s, claims that there was NO CONFLICT OF INTEREST in how I was routinely and openly conducting my business affairs. The state attorney general is the constitutional officer designated to interpret state statutes. Section 1090, the conflict-of-interest law, is subject to interpretation by the state attorney general since it is state law. The City of San Diego does not have a higher standard for conflict of interest and uses Section 1090 in all of its dealings with private consultants or public officials. (A copy [of the attorney general’s opinion was provided], which Mr. Bauder apparently never bothered to read but mentioned only in passing.)

Notwithstanding this written opinion, Kessler and apparently Detective Vile, neither of whom are attorneys, continued to argue that the attorney general was wrong. The District Attorney’s Office did not pursue a criminal prosecution, not because of my claimed influence with Bonnie Dumanis, but rather because the attorney general proved that both Kessler and Vile were wrong! According to the head prosecutor in this state, I had committed no violation of the conflict-of-interest law. Bauder knew this but still chose to recklessly print these outdated and rejected claims that I had violated the law.

By the way, Bauder also knew about all of my efforts to dispel Kessler’s false claim by contacting every law enforcement agency I could think of, yet he once again chose to ignore all of these facts. I ask you, does contacting the Ethics Commission, the District Attorney’s Office, and the Attorney General’s Office sound like the actions of a corrupt businessman improperly using his influence to cover criminal conduct? Of course not. I and my company were totally open in every aspect of my business and continue to be.

Alleged “Influence”:

I would also like to correct the record about Bauder’s utterly false claims that I improperly influenced Bonnie Dumanis not to pursue my prosecution against "her subordinates' recommendation,” as claimed in your published articles. Bauder knew that this statement was false and included it maliciously to not only defame me but also the District Attorney’s Office. No subordinate of the District Attorney’s Office recommended my prosecution. This claim was fabricated by Mr. Bauder. To the contrary, my case was investigated, and once analyzed, no one in the DA’s office recommended prosecution because there was no conflict of interest.

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