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Business Leaders Discuss What They Want From San Diego's Next Mayor
September 19, 2012 1:11 p.m.
Vincent Mudd, president and owner, San Diego Office Interiors.
Disclosure: San Diego Office Interiors is an underwriter of KPBS.
Camille Sobrian Saltman, president, CONNECT.
CAVANAUGH: Continuing coverage of the San Diego mayor race. In the next two week, we'll be checking in with different segments about the San Diego community about what they're looking for in a new mayor and administration. We're asking leaders in business environments and the arts how city government could help them succeed. We want to keep the discussion has nonpartisan as possible. Is this not about the candidates as much as it is about making San Diego work. My guests, Vince Mudd is president and owner of San Diego office interiors. His past chair of the San Diego regional Chamber of Commerce. And San Diego office interiors is an underwriter of San Diego. Welcome back to the show.
MUDD: Thanks for having me.
CAVANAUGH: And Camille Saltman is here, president of can have connect. Her organization has brought together investors and inventors in the life science industries and high-tech industries. What is it that you hear most often from business owners about their dealings with city government, Vince?
MUDD: Probably more than anything else is there's too much discretionary approval in their dealings with the City of San Diego. In other words, if you have a situation where you're guided lie administerial requirement, let's just say you're going to be building a new office building, and it's an administerial process, meaning there's a check list, you know what's expected of you, you fill out the list, your billing is approved. That isn't exactly the way it works in the City of San Diego today. Today, it's highly discretionary. So it's entirely possible you could invest millions of dollars in an opportunity to do something to create a factory bill of business, and not know what it takes to get it done, and as a result -- it impacts the amount of capital that comes into your city because people are just unsure how long it takes to go from idea, implementation, to generating revenue.
CAVANAUGH: They don't know what specifically they have to do in order to get the approval.
MUDD: Because the process has a very high level of discretionary decision points made by many versus an administerial process which is very clean and easy to follow.
CAVANAUGH: And Camille, what is it that you hear most often from business owners about their dealings with city government?
SALTMAN: The businesses that I deal with are most concerned with infrastructure. Our road, the bridges, the green spaces, the ability of the city to compete with New York and DC and San Francisco to attract talent. If we have a crumbling city, it's going to be hard when we face so many shortages of talent to really keep people here and attract them here
CAVANAUGH: So it's the look of the city that you hear from from people thinking of transferring their business here?
SALTMAN: It's partly the look and it's partly being forward-thinking about solar energy and clean technology. It's partly the effectiveness of moving from one place to another and the safety of the city. If you give the -- if you give the impression of a crumbling city that's not keeping pace with the times, it's not compelling when you try to attract talent.
CAVANAUGH: We have heard in political discussions about business and how a new administration might help business. I hear a lot about it when I talk to business leaders on the show. Difficulty with rules and regulations and bureaucracy. Are there any onerous situations that you'd like to see corrected in permitting and licensing as opposed to the discretionary, administerial thing you were talking about?
MUDD: I think this is a good example on the permitting side. When you pull your project together, you don't know how much that permit is going to actually cost before you start. So you might find yourself in this potentially lengthy loop where your costs are going up, you're less and less certain, and you don't really on the other hand why that is what it is. I think for example there's no master plan for the region that says something like this, if you have a project in Kearny Mesa, and Kearny Mesa is a very industrialized city with not a lot of housing, when you go through your process on that piece of land and having a similar use, but just newer and potentially slightly larger, that should just being one of the simplest things the city does. And years ago, the city did do that. If you look at Kearny Mesa, that property where general dynamics used to sit was part of an enterprise zone the city created to create that manufacturing concentration in San Diego, and they made it very easy to attract those companies.
CAVANAUGH: And to you, Camille, anything that's particularly onerous or doesn't make much sense to you when it comes to permitting and licensing in San Diego?
SALTMAN: In at this time innovation economy, there's a great deal of outsourcing that gets done. And companies look at San Diego, but they also look at Taiwan and China and India and Germany. And in those country, the governments are working to streamline processes. You could get an entire supply chain set up in six months. Where here it might take six years. So the choice becomes obvious. Move quickly and start producing product or go through this uncertainty and lengthy process and not stay competitive.
CAVANAUGH: Let me pose another question. In doing research for this, I saw a recent study by the Rose Institute at Clairemont, McKenna college. It found that San Diego is the least expensive big city in California in which to do business. And I'm wondering, do business leaders acknowledge that they've got a pretty good environment to begin with here in San Diego?
SALTMAN: San Diego offers an incredibly attractive environment. The city setting up the Torrey Pines Mesa as a zone for life sciences means we've got many institutions there, the UC San Diego campus, and a huge cluster of algae-related sciences and communications companies working together. In the bay area, it might take you an hour or two to get from one place to another, here it takings you five minutes. All those things make it less extensive and much easier. I think these kinds of changes will make us competitive not only in California but across the country.
CAVANAUGH: And as far as taxes and fees for businesses, they are pretty reasonable here if you compare them to other big cities in California, is that true?
MUDD: I worked on a task force upon. And there are a lot of realities there. And it is true, if you're a call center, this is a tough place to be because energy costs are high, real estate costs are high, and your employees might be more expensive. So there are certain business clusters that would find San Diego to be expensive, but if you're in the innovation economy and competing against San Jose or Washington or someone in Boston, San Diego is a very good deal for you. The challenge though is it's not enough to be cheap to work in. It's about how do you get things done effectively, efficiently, cleanly? So you want to be in the city that's the most innovative city that acknowledges that for every minute you're not actually producing that new product or new idea, you're losing ground. The idea I come up with right now will be old by the time I leave the studio.
CAVANAUGH: I got you. There are a couple of people who want to talk about the permitting process apparently, here in San Diego. Allison is calling from Tierra Santa. Welcome to the program.
NEW SPEAKER: Hi. I just was calling to give some feedback in regards to permitting on this end, which is that it's kind of a nightmare process to go through the permitting process for the city. And then when you actually call for the inspectors to come out, each inspector -- there's no consistency from the inspectors. Some inspectors will have certain requirement, some will not, some will want you to do certain things, some will not. And so it's like a crap shoot of what you're going to get when the inspector comes out and whether something is going to get signed off or not on the final inspection. And my other comment was just on the prevailing wage and all the paperwork, and the labor I laws, and the apprentices, and the nightmare that that causes for companies when working with public funds in the State of California.
CAVANAUGH: Allison, thank you very much for your input. I appreciate it. Does that go to what you were speaking about with the sort of no check list process for the city employee when is it comes to permits?
MUDD: Right. I don't want to be overall specialist. But a jiffy lube, guin there, there's a 30-point inspection, and you know what you're getting, they know what you're getting. And it's a simpler, better process. In our city, we have seen because of the fiscal issues a great deterioration of some of the city staff. So you just don't have as many people doing the job, and you probably have lost a lot of talent. So I think the young lady was talking in the area of inspections, you may not get the same inspector every time, and the one you get may not know as much as the one you used to have. The good news is it's fixable. These are not impossible challenges. This is just if you acknowledge that, you could go get it resolved.
CAVANAUGH: Camille, you hear from business leaders and owners about the way the infrastructure works, and the look of the city, and the overall liveability of the city. Do you think city leaders as has been commented in some of the mayor debates should get more involved with education and help supply workers for high-tech businesses?
SALTMAN: I'm very glad you asked that question. In San Diego as in some of these other major tech centers, we have huge shortages of trained workers. Some estimates in the software field put it as high as 4,000 to 6,000 unfilled jobs. 70% of manufacturers are finding it severely difficult to fill trained spots. So bringing together workforce with education and aligning those so that workers get trained for the gaps, and workers get retrained for the jobs that are open I think is a critical priority for us to be able to continue to compete.
CAVANAUGH: Vince, is there enough of that going on, do you think?
MUDD: In pockets. For example, I chair a chambers education committee, and we've been working with council president Tony Young, and the mayor and others. And you saw district attorney Bonnie Dumanis, Nathan Fletcher, a lot of folks understanding that there is a role to be played. My suggestion is to remind them of two things. No. 1, going to school is a job. We have to remind our children of that. That is their job, to go and get educated. Because the deliverable to the country is a workforce that's going to create, innovate, and drive our economy. We have to first acknowledge that's a job, and we can't afford the unemployment deficit of education any longer. Conda Lisa rice said it's probably the civil rights issue, education of our times. The fact of the matter is, these young people who are our future, this separate and inequal, this unverifiable level of competence or unverifiable level of ability is no longer possible. When you graduate from high school, we should be graduating plumbers that know how to be plumbers. If you look at a factory that builds solar panels, there's a lot of pipe fitters, mechanics. These are good jobs. It's not only about going and getting your postgraduate education. It's about making sure that every student has a path to education that's even more than just the three Rs.
CAVANAUGH: How important, or is it important for business if there's a good working relationship between organized labor and the city?
SALTMAN: I think that it's important to have business, labor, and the city aligned in order to deal with some of these issues. Especially the retraining issue. When we are lacking skilled trades and production operators and solar installers and some of these fundamental positions, we really need the parties working together to plan out for the next five years where the jobs are going to be, how we're going to pay them fairly, the benefits that would be required, workers' comp, the hours. Right now, some of these companies, especially manufacturing companies are having to simply extend the work hours for workers in order to get the work done. And that doesn't, in terms of safety, quality, that doesn't help anybody.
CAVANAUGH: And Vince? How important is that for businesses if it is important at all for the city and labor unions to have a good working relationship?
MUDD: It's very important. Interestingly enough, we have a very small labor-driven economy. It doesn't sound like that when you hear it out in the public, but some of our most sophisticated companies, AT&T, AT&T is the largest employer in the United States. I think that stat is still accurate. And they have the largest union workforce as does SDG&E. So there are some people that do a good job managing their labor no differently than I manage -- I'm a private business, I believe I represent labor because I hire people and I care about them and I take good care of them. So there's a difference between labor and good relationships and labor unions, and some business people think some unions are not as focused on helping the company get to be successful enough to pay the people a good wage and something else. And I'm not disparaging them whatsoever. I'm just saying it seems to be much more logical for us to work together regardless of whether it's a labor union or our own labor and make sure that we're providing the kind of work environment that can produce the result our customers are looking for. Because if we don't produce the results our customers are looking for, we're out of business anyway.
CAVANAUGH: Camille, as nonpartisan as we possibly could, I want to acknowledge that you are supporting Carl DeMaio now after publicly throwing your support behind Nathan Fletcher before the primary. What will you be pushing to see changed at City Hall, no matter who becomes mayor?
SALTMAN: I think it's time to bring -- I come from the innovation economy, so many of the solutions I think about are related to that. It's time to bring technology to the city processes, it's time for us to get into the 21st century and use the Internet. It's time for us to install solar and start to use the energy gas from the landfills to drive power. It's really time for us to start saving money, creating efficiency, and redirecting those dollars to the areas that need improvement, like infrastructure, like these regulatory issues and permitting issues, and like education so we can continue to compete as a city.
CAVANAUGH: And Vince, you're not supporting either candidate. Why is that?
MUDD: I know them both. They're both good guys. And my role as past chamber chair, it's better for me to be able to work with both groups or both parties. But I do speak to them often, and I do talk to them about what I think is very important to the City of San Diego and our competitiveness. And I think that there is a role that they can each play. One thing I've asked both of them, no matter what happens, whomever wins or loses, the loser is supposed to help support the win. So if you've got a great idea in your back pocket, I want to see that idea presented to the new guy because we need you both.
CAVANAUGH: I want to thank you both.