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Downtown Residents Want Their Refund

More than 2700 downtown property owners are still waiting for the city to pay them back for overcharging them on property assessments.

In 2005, city consultant SCI Engineering recalculated the engineer's report. However, the firm miscalculated, overcharging downtown properties anywhere from $32 to $500 extra per year for enhanced city services such as graffiti abatement, sidewalk maintenance, and security guards.

The error was first noticed by property owners in 2009, four years after the city had approved SCI's engineer's report.

Shortly after noticing the mistake, some downtown residents asked the city to notify all the property owners that had overpaid and then issue refunds. A small group of residents began attending council meetings and meetings of the Downtown San Diego Partnership, the agency that manages the improvement district.

In June 2009, Luis Ojeda, program manager for the city's economic development department, informed some residents that a refund check would be issued, and all property owners would be made aware of the mistake.

Neither happened. I wrote a story on their efforts in April of 2010.

On June 14, two years after Ojeda's promise, the city filed a lawsuit against the engineering consultant. The city also paid the new engineering firm, Koppel and Gruber, $50,000 to audit the flawed engineer's report.

Meanwhile, the residents continue to wait and continue to pay their property assessment and wait to find out when and how much they will be refunded.

"I was told that they have to find out if there are any more errors before refunds can be issued," says downtown property owner Kathy Casey. "The audit should give us exact figures of the amount collected in error."

On Tuesday, July 26, city councilmembers will consider renewing the assessment for the Downtown Property and Business Improvement District.

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More than 2700 downtown property owners are still waiting for the city to pay them back for overcharging them on property assessments.

In 2005, city consultant SCI Engineering recalculated the engineer's report. However, the firm miscalculated, overcharging downtown properties anywhere from $32 to $500 extra per year for enhanced city services such as graffiti abatement, sidewalk maintenance, and security guards.

The error was first noticed by property owners in 2009, four years after the city had approved SCI's engineer's report.

Shortly after noticing the mistake, some downtown residents asked the city to notify all the property owners that had overpaid and then issue refunds. A small group of residents began attending council meetings and meetings of the Downtown San Diego Partnership, the agency that manages the improvement district.

In June 2009, Luis Ojeda, program manager for the city's economic development department, informed some residents that a refund check would be issued, and all property owners would be made aware of the mistake.

Neither happened. I wrote a story on their efforts in April of 2010.

On June 14, two years after Ojeda's promise, the city filed a lawsuit against the engineering consultant. The city also paid the new engineering firm, Koppel and Gruber, $50,000 to audit the flawed engineer's report.

Meanwhile, the residents continue to wait and continue to pay their property assessment and wait to find out when and how much they will be refunded.

"I was told that they have to find out if there are any more errors before refunds can be issued," says downtown property owner Kathy Casey. "The audit should give us exact figures of the amount collected in error."

On Tuesday, July 26, city councilmembers will consider renewing the assessment for the Downtown Property and Business Improvement District.

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Comments
5

Golden Hill also had misrepresented assessments. Will we get our money back also? The same Engineering firm provided the data for our Maintenance Assessment District (MAD) costs. We complained to no avail.

July 23, 2011

SCI Consulting is run by only two people, both of whom are marginally deserving of the title "engineer." The primary engineered goods they produce is property owner dollars for willing partners such as the City of San Diego Economic Development Department.

SCI couldn't exist without eager government partners such as Jerry Sanders' EDD, looking for a way to fund privatized services and to pay business groups to run the services (remember the recent Reader story about the Downtown SD Partnership's security patrol guy who refused to call 911 because he didn't want to use up his cell phone minutes?).

The City's suit against SCI now, for breach of contract, is really sweet. The City loved SCI's work when it was useful, defending it in a lawsuit by property owners of Golden Hill and South Park (which the City lost), even though the City knew the SCI report was flawed and contained lies and errors (the report included untruthful statements provided by the City, about the process steps the City legally must undertake to form a MAD; SCI apparently felt no obligation to vet the truth).

SCI has been notorious statewide for years as a hack company for hire to local groups and governments who want to get their hands on extra tax dollars, without the inconvenience of that pesky 2/3 vote requirement to raise taxes. SCI's purpose is to provide local governments the legal documentation necessary to meet State laws governing assessments, so that the next step, the "weighted" majority vote based on the money value of the assessment, can be implemented to pass the tax.

The validity of SCI's "engineering" is widely questioned. They work backwards, staring with the amount that a group wants to collect, to come up with phony data showing that the costs would be that large. In Calaveras County in 2008, SCI was paid $23,000 to conduct a public opinion poll to see how large an assessment people might agree to pay to fund a mosquito and vector control district. Of all local property owners, only 30% responded, and half of those suggested they might be willing to pay up to $16.50/year. Bliss calculated that this would net the district $470,000 per year, and that a weighted vote would pass. SCI's Bliss then urged the County to pay him another $14,000 for an Engineer's Report and $64,000 to conduct a ballot. A County supervisor pointed out that the County environmental management director had recently calculated that budgeting $80,000 for its mosquito and vector control program would be entirely adequate. But according to SCI, why collect $80,000 when you could get $470,000? The County decided that this was wrong and dropped SCI's plan.

July 23, 2011

More SCI sloppy work, for lots of money.

http://www.mercurynews.com/ci_17982100?IADID=Search-www.mercurynews.com-www.mercurynews.com

05/03/2011 05:18:35 PM PDT

"The East Contra Costa Fire District's effort to remain solvent with the help of a property assessment stalled this week when directors scuttled a report needed to bring the matter before voters.

Director Steve Barr noted that the computations in the consultants' report were difficult to understand, and colleague Erick Stonebarger along with an audience member questioned whether the firm had accurately calculated the distance between certain homes and the nearest fire station.

Director Jim Frazier was unsettled when the fire district's attorney noted that the benefit assessment could encounter legal challenges.

...SCI Consulting Group presented the document,...The district signed a $100,000 contract with SCI Consulting..."

July 25, 2011

Forgot to mention: It was SCI, operating under their alternate name, Shilts Consultants, run by Bliss and partner van Steyn, that did the flawed Engineer's Report for the Santa Clara Open Space Authority's assessment on Silicon Valley taxpayers, to pay for acquiring land.

That assessment was challenged and was overturned by the California State Supreme Court in a landmark ruling that declared the assessments invalid. The ruling put to rest the notion that local authorities could impose assessments that did not confer "special benefit" to each and every property directly and obviously proportional to the assessment amount.

Saying in a Engineer's Report that the assessment is proportional doesn't make it so, though that's what San Diego has decided is legally adequate to add to their phony reports.

The City lost the Golden Hill MAD lawsuit exactly over the special-benefit/proportionality issue. That hasn't stopped them from appealing, and meanwhile they keep taking the assessments, which they will be forced to settle eventually. They've taken ~$500,000/year from property owners in one of the poorest areas in San Diego, Golden Hill, since 2007. Even worse, the City embarked on the same illegal course recently in North Park, attempting an "overlay" MAD. The City is lucky the North Parkers voted it down, because they would have had yet another lawsuit to lose.

One other twist: The Golden Hill MAD involved SCI, which the City is now suing, and SCI was brought into the mix by Ojeda's former boss at Economic Development, Scott Kessler, who is now suing the City for firing him.

July 25, 2011

To the twisted mix of Kessler, SCI, Economic Development, and assessments, and lawsuits involving all of them, also add Marco Li Mandri and his use of SCI for raking in dough for his Little Italy gang. Here's one document to show that arrangement: http://www.littleitalysd.com/boardminutes/200903.doc

July 25, 2011

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