San Diego Mayor Bob Filner has presented a modified proposal to the Tourism and Marketing District board that he says would release the disputed funds earmarked for advertising immediately.
The counteroffer was presented to the TMD last week. The board was scheduled to discuss it in a closed door meeting today, but given the pending lawsuit the group filed against the mayor it is unlikely that any movement will be made toward resolving the dispute.
“I am negotiating in full faith here,” said Filner during a press conference Monday to announce the plan, noting that he has not heard any feedback from TMD executives.
According to a UT-San Diego report, one member of the TMD board has said that he doesn’t trust the mayor and would not support the new proposal.
The mayor’s offer changes approximately 600 words from the original document, said Filner. In it he asks that the five year operating agreement be reduced to one year, renewable for as many as the remaining four years if the arrangement is working well. He also calls for stronger indemnification for the city’s general fund through stricter insurance requirements should the courts rule the TMD funding mechanism an illegal tax, and restores indemnification for elected officials which was eliminated from the original agreement.
Filner also insists that TMD executives be prohibited from earning an annual salary of more than $160,000. The current President and CEO of the TMD, Joe Terzi, earns $435,000 per year, while Vice President Margie Sitton earns over $203,000. Two other executives earn over $170,000.
“Nobody would tolerate that if it were city employees making (close to) $500,000 per year,” said Filner, pointing to the vitriol toward public employees during the Prop B campaign last spring.
The Tourism and Marketing District is a private entity controlled by local hotel interests that assumed the duties of the Convention and Visitor’s Bureau, formerly a public entity.
The mayor is also asking that the TMD board contribute $5 million toward the 2015 Balboa Park Centennial celebration, which he argues would be under their purview as an event that will draw tourists to the city and fill hotel rooms.
In addition, Filner is asking the TMD board to encourage their member hotels to pay their employees a living wage. Under the current living wage ordinance, the city cannot require the private hoteliers to provide a living wage to their workers.
The Tourism and Marketing District was created by a 40 year agreement that formed a conglomeration of hotel properties for the purpose of promoting San Diego as a tourism destination in other markets across the country. It includes a separate contract that serves as an operating agreement, renewable in five year increments, that is at the center of the board’s dispute with the mayor.
Edited to correct the name of TMD CEO Joe Terzi.
UPDATE: As expected, the TMD board has rejected the modifications offered by Mayor Filner. TMD Chairman Terry Brown issued a statement saying, in part, “The Mayor’s proposal is not only contrary to all of the approvals last year by the San Diego City Council, but we also believe it is illegal.”
The statement continues:
The (City) Charter does not grant power to the Mayor to enter into a new contract without City Council approval. Further, the Charter and municipal law is clear that the Council is the only entity that can approve contracts and any contract entered into without their approval would be void. Although we believe this proposal is illegal, even if it could be accepted, it would irreparably damage the tourism economy and create even more instability for the over 160,000 San Diegans who work in tourism and hospitality services.
As a result, we cannot accept this new contract and will look forward to the court’s resolution of this matter. We are disappointed that we have to seek a court order to compel the Mayor to do something we and the City Council believe he is legally obligated to do. We believe this is in the best long term interest of the many thousands who work in the tourism industry and for all San Diego taxpayers who benefit from the hundreds of millions of dollars tourism generates in taxes and economic benefit for our city.
The contract was originally negotiated during former Mayor Jerry Sanders’ tenure, but he never signed the final agreement, leaving it for his replacement, Filner, to sign.
It seems difficult to fathom that Mayor Filner would be required by the courts to sign a contract that he played no part in negotiating, but that seems exactly what the TMD executive board is counting on. For his part, Filner is confident that the presiding judge in the case will rule in his favor when the hearing is reconvened on Friday.