Sandag accused of eminent domain abuse

The San Diego Association of Governments is considering using eminent domain to take an entire downtown block. The land owners say they are concerned about what the agency plans to do with it, since the plan ranges from a parking lot with bathrooms to a multi-use residential high-rise.

An attorney who represents owners of two parcels called the staff plan “a bait and switch,” pointing out that using eminent domain to take privately owned land and handing it to a private developer is not allowed. “We have two very different visions of the project and no idea of what’s being done,” said Jacqueline Vinaccia, who represents the San Diego County Bar Association.

Sandag staff says the land, the block between Union and State streets east and west, and A and B streets, will be used as a much-needed bus layover facility. But Richard Chavez, the project manager, says the organization has been asked to consider developing a building with residences and offices above the layover — and putting Sandag offices in the new building.

Private, mixed-use developers won’t make a proposal for that building until they are certain that Sandag owns the land, Chavez said. He estimates the bus layover project cost at between $75 million and $85 million.

The six parcels that make up the block, mainly a parking lot with 164 spaces, an auto-repair shop, and two small commercial buildings, are owned by criminal defense lawyer Chuck Goldberg, King Stahlman’s family, the Townsend Family trust, the McClellan Trust, and by two limited liability corporations set up by the San Diego County Bar Association. The parking lot is run by Ace Parking and the bar association reported about $350,000 in income from their part in 2015.

The Stahlman family and Goldberg are interested in selling their land — for about $9 million and $3 million. McClellan uses the red brick building on Union Street to store cars and has an offer of $3 million. He isn’t interested in selling — nor is the bar association, which gets “significant” income from the two parcels. Sandag’s appraiser valued those properties at just under $12 million, according to Sandag documents.

Goldberg and McClellan did not return calls for information and comment.

Scott Ward, who runs A Street Auto Repair, says the shop has been in the family for three generations. The shop has six employees, and he’s getting ready to start looking for a new place.

“They’re developing so much downtown that mom-and-pop shops have to leave,” he said. “So I don’t know when it will happen, but they’re telling me it will.”

The bar association and the Townsend trust are not interested in selling the land and have begun to look at how Sandag chose the land in the first place, how it certified its environmental review before the project was defined, and, most of all, they’re trying to figure out what Sandag is trying to do.

“Sandag has not articulated an actual project that can be a public use, and without it, cannot rely on eminent domain without a cognizable project,” said Vinaccia of the bar association. “There are indications that it’s a bus stopover with a small building for bathrooms but there are documents that show they plan to bring in a developer to build for private use.”

Sandag’s lawyer said that the ground is for public use, but the air and subsurface rights can be used for other purposes.

“We believe Sandag’s true intent is to use this land for a private development, which is not an appropriate use for eminent domain,” Vinaccia added.

In November, the regional association voted to delay eminent domain action until staff met with the resistant owners to try and negotiate a deal they'd find acceptable.

Sandag has been working on the effort since 2011. In June 2016, the Sandag board approved the environmental document for the downtown bus layover part — a parking lot with a small building that’s a restroom for bus drivers.

Staff estimates that 400 buses will use the stop on every weekday, with that number expected to rise to 700 in the near future. Right now, the buses are idling on city streets, near porta-potties placed there for drivers.

“We absolutely need this,” said Paul Jablonsky of the Metropolitan Transit Service. “We have buses laying over in eight different locations [downtown]. We have porta-potties all over the city and we have to move them. It’s just not the way to run this.”

Sandag documents indicate the agency anticipates 300,000 square feet of residential use, 300,000 square feet of office, 20,000 square feet of street-facing retail in a building up to 400 feet tall.

The offers reflect that the land would be used for a development project, not for a parking lot, Sandag lawyer Andrew Rauch said.

“Our appraisers have said the highest and best use for these properties is a high-rise development,” Rauch said. “We’re offered compensation to them as if they were in private development.”

But Sandag regional transportation committee chair (and San Marcos mayor) Jim Desmond said he is a little uneasy about the plan.

“I’m concerned we’re mixing private development with eminent domain,” Desmond said. “We should not be taking from one commercial entity and giving it to another commercial entity.”

San Diego City Councilwoman Lorie Zapf said she had some concerns about using eminent domain — especially since her district started the process for the mid-coast trolley project at Morena Boulevard. Sandag initiated eminent domain there and then backed off.

“Definitely, the buses, maybe the Sandag offices, but when we get into the development…I’m not sure that’s in the public interest,” Zapf said. “I don’t remember eminent domain being discussed and I feel like this is being rammed through right now.”