Morning Report: The $67 Million Unanswered Question

By Andrea Lopez-Villafaña, the Voice of San Diego

March 20, 2023

Did the city of San Diego pay too much money for a hotel that was purchased under the cloud of a conflict of interest-scandal? Well, we don’t have an answer, yet.

Here’s what happened: The San Diego Housing Commission bought a hotel for $67 million in August 2020 to turn into housing for formerly homeless people. This deal was made with the help of a broker, who the agency later learned, invested in the company that sold the hotel to the city. That immediately raised questions about the price the city paid in the first place.

And that’s because the original purchase appraisal determined the value of the hotel as if it was February 2020 — before this thing that shut down the world happened. It’s not clear why officials backdated the appraisal. But when the broker’s investment came to light, the Housing Commission set in motion a new appraisal.

The latest: Our Andrew Keatts reports that this new appraisal ended up answering a different question: What would the hotel have been worth if it had not been a hotel?

That’s because the new assessment, while it looked at what the property was worth when the city made the purchase, Keatts writes “it made a different, key methodological change that continues to prevent a simple, apples-to-apples comparison.”

Read about the new appraisal here.

Politics Report: Pick Your Measures

It’s all in the details.

The Politics Report rounded up some lingering questions about an announcement late last week: Mayor Todd Gloria and Councilman Stephen Whitburn will be pursuing a city ordinance to prohibit homeless encampments on city land. And there’s also a ballot measure in the works, the mayor announced.

But how will the new law work? Where will new shelters be — a key element is that the city have more shelter options for the people it seeks to remove from the streets. Why do we need a ballot measure? And, why is the mayor doing this now?

Plus: Former Mayor Kevin Faulconer is working on a separate measure that could do something similar — prohibit encampments while mandating the city provide sufficient shelter options. How does that measure up? (No pun intended)

Read the Politics Report here.

BTW: Our Lisa Halverstadt covered the Gloria and Whitburn’s announcement last week. She added some crucial context to consider about the proposal and challenges ahead. Read the full story here.

VOSD Podcast: In the latest episode our hosts also unpack the city’s latest effort to address the homeless crisis. Mayor Gloria emphasized that if a homeless encampment sweep is happening and there’s shelter space available, “no” ain’t gonna fly. This prompted our hosts to ask, “Still … What if someone says no?”

Listen to the discussion here.

In Other News

• Union-Tribune columnist Michael Smolens ponders on where three GOP San Diego mayors could end up. Read it here.
• San Diego State has thrown a wrench in Chula Vista’s plan to finally attract a four-year university to the city. The Union-Tribune reports there is a disagreement on design plans, so they’ve decided to extend negotiations with the city through the end of May. The city, though, has a lot hanging on these negotiations.
• KPBS profiled a formerly homeless man who is now helping unhoused residents in Chula Vista.
• ICYMI: Our daily news editor rounded up our top stories you need to read to start your week in Cup of Chisme. She opens up about challenges in her community and unpacks the mayor’s announcement on encampment enforcement. Read it here.
• Sorry, sunshine lovers. It’s going to rain again.

Voice of San Diego is a nonprofit news organization supported by our members. We reveal why things are the way they are and expose facts that people in power might not want out there and explain complex local public policy issues so you can be engaged and make good decisions. Sign up for our newsletters at voiceofsandiego.org/newsletters/.