SD Development Corporation in Hot Water

KPBS | By KPBS Public Broadcasting

Published July 18, 2008 at 12:24 PM PDT

This story was published more than 15 years ago.

San Diego Mayor Jerry Sanders has asked the head of the Southeastern Development Corporation to resign, because of financial improprieties. SEDC faces mounting criticism for inadequate disclosure of g

Mayor Jerry Sanders has asked the head of the Southeastern Development Corporation to resign, because of financial improprieties. SEDC faces mounting criticism for inadequate disclosure of generous executive bonuses. The agency is also in trouble with the State Attorney General’s office. KPBS reporter Alison St John has more. The SEDC manages redevelopment for the city of San Diego in Logan Heights, Grant Hill and Barrio Logan. It is a non-profit corporation that manages public money and it has tax exempt status.

Recent audits have uncovered major discrepancies between the budgeted salaries of top executives and what they actually earned.

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The agency has also failed to send in it financial statement and registration fees to the state. Abraham Arredondo is a spokesman for the State Attorney General’s office.

Arredondo: The Southern Economic development corporation hasn’t sent in anything since when they originally incorporated and originally registered with the state … so we sent them a warning letter now we usually send three letters and after that if they don’t respond we have to submit it to the franchise tax board.

San Diego’s other development corporation, the downtown CCDC, has also received warning letters from the state Attorney General’s office. The city's development agencies were criticized in a recent grand jury report, and the City Council plans to review their role.

Alison St John, KPBS news.