A proposed road from Cabrillo Bridge that bypasses Balboa Park's Plaza de Panama and leads to a newly constructed parking garage must make another stop in San Diego Superior Court.
Earlier this month, Cory Briggs of San Diegans for Open Government sued the city over its plan to use its funding arm, the Public Facilities Financing Authority, without first obtaining voter approval.
City officials formed the Public Facilities Financing Authority in 1991 to help the city's redevelopment agency finance large capital-improvement projects. The Public Facilities Financing Authority, which includes the city, the former redevelopment agency (also known as the city council), and the San Diego Housing Authority, is considered to be an outside agency.
By existing as a separate entity, the Public Facilities Financing Authority uses city-owned property as the collateral needed to sell lease revenue bonds. The authority then leases the public land back to the city as a way to generate revenue. Critics consider the municipal bond scheme as a "total scam."
In 2014, Briggs sued the city for issuing the bonds and thus creating a financial risk to taxpayers. A judge ruled that the lease revenue bonds were legal.
The victory, however, was short-lived. In June 2016, voters approved Proposition B, making it more difficult for the city to issue the bonds without voter approval. In the measure's language, the city council could issue revenue bonds to pay for construction or replacement of water or wastewater facilities if there is a two-thirds council majority.
Yet, in its quest to begin the Plaza de Panama project, the city has again turned to the lease revenue bonds to generate $50 million toward paying for the parking garage and construction of a bypass road from Cabrillo Bridge.
The proposal to build a road that bypasses the Plaza de Panama was introduced in August 2010 by proponent and partial financial backer Irwin Jacobs. The plan, however, was not well received. Save Our Heritage Organisation sued the city over the plan in 2011. A San Diego Superior Court agreed with the group but a state appellate court later overturned his decision, allowing the project to proceed.
Proceed, it did (despite several obstacles), in December 2016, when the city council authorized the issuance of $50 million in lease revenue bonds from the Public Facilities Financing Authority. That same month, Save Our Heritage Organisation alleged the city neglected to study the environmental impacts of the bridge and parking garage; that lawsuit is currently ongoing.