Roundtable: SANDAG Investigation; Transit Hits, Misses; Disappearing Affordable Housing; Vegas Raiders
MS: Transportation projects, miscalculations could have a big change in how it is run. Trolley ridership is down across the county. Nonprofit developers are building affordable housing, which stays affordable. There's a new stadium but the NFL approved the Raiders to move to Las Vegas anyway. I am Mark Saur and KPBS Roundtable starts now. MS: Welcome to our discussion. Joining me at the roundtable today is Andrew Keats. AK: Hello. MS: It is good to see you. MS: Andrew Bowen, hello. MS: It is good to see you. Allison St. John, hello ASJ: It is good to be here. MS: Jay Paris. JP: Good to have me. MS: We approved the transmit tax to pay in transportation projects. The cost increases and revenue forecasting by SANDAG leave them $17.5 billion short. The rejections that MS: The objections used for the sales tax, there is plans for investigation and calls for an overhaul of SANDAG . Start with the shortfalls in this measure. They were campaigning through the year of $8 million and there were figures they were campaigning. Bright? AK: That they were clear that the year that it was going to produce $18 billion in local revenue that they would spin off with the state and federal money to build projects. MS: For many years going forward. AK: In reality, it was going to bring $14 billion. MS: This was known for months by SANDAG and not the public ? AK: Yes. Technically, they work on the specific forecasts. They figured out there was a big problem a year before the election last year. MS: What is the problem? AK: This is important. The problem is they used the wrong numbers. Literally, they included a copy paste error. They put the wrong number in the wrong cell that was used in the forecasting. AK: From -- from time to time, you see a board member say look forecasts are not clear of what is happening of future. Sometimes we are high and sometimes we are low. No one should expect this to be 100% right or it cannot be factually wrong. When somebody says that, you need to here that they are spinning you or they have not done work to understand what happens. The forecasts were wrong. They put the wrong numbers into the spreadsheet. I will use an analogy. If you put the Padres batting average in into a spreadsheet that is connected to a formula of some kind, that would give you a number. It does not mean you can wash you have a sales forecast. They put the wrong numbers in. AB: It could've been right but it wasn't. AK: Exactly. What you want us to do? They put the wrong numbers and. This is factually wrong. MS: There's a big shortfall. How do you make of the funds? AK: They have maintained that they think there is going to be a possibility that they get the money they need. What do you do if you don't have enough money? Is simple. You get more money somehow or you cut back on your ambitions. That is what they are looking at. They have a plan to get more money and it is to hope they are more competitive and competing with other regions for more grant money. It is a great plant for works there happens to be others who think they will do a great job in getting money. Maybe they will. No one can say they won't. Back to the matter is, if they did, if they close the gap, they will be more competitive and get a greater share of outside money into the county than they ever have. ASJ: One of the things that amazes me is because they are leveraging and you would think the people would give them money based on the forecasts. They are in the dark. You thought that would've checked. AK: Yes. Is tied to a project. For instance, the federal government Dutch does not just say -- they do not just say here is $1 billion. They tie it to something. When they do that, they are going to make a specific calculation based on recent collected tax revenues and the short-term times. They are not as concerned with the forty-year aspect. That is much more of a concern of the agency for its ambitions where as the federal government is looking into whether there is enough money to make a specific project. MS: You reported that they would have this investigation. What happened and what went wrong? Only seven firms are bidding. AB: The SANDAG board already approved internal policy changes to try and make the revenue forecasting more transparent and given more oversight. They approved an investigation by an outside firm and they will look into who knew about this and who do they tell? Why wasn't -- why were the voters in the dark? Have a lot of work to do. They are pouring through thousands of emails and doing interviews. The big question is, were voters and board members deliberately deceived by how much money this would produce? MS: We have a bite that I want to set up. You spoke with the board member Rob Roberts. And this is the best place for the projects. RR: I have a different take. What the public wants, do not care who is doing a bickering. They want somebody to deliver on things that we need. SANDAG is positioned to do that. I think you'll see what is happened this year in terms of projects. There is a fine record that is developed. MS: He has confidence but we're going to Sacramento and Fletcher has a reform proposal that is being put afloat. AB: Yes. The idea is to make it a product. There are 18 board members. They’re somebody from each city in the county as well as two or members from the Board of Supervisors. They take votes and they are counted two waste net two -- two ways. Big cities like San Diego has more influence over the decisions. They are closer to the idea of one man and one vote. People who are affected most by the decisions have the most say and how those decisions are made. ASJ: peaking to someone who is covering these, question is, is the big bear in the middle going to get all the money? There is a lot of money going through these agencies. Who controls the money is key. The small cities have less of an influence that could be a big concern. AK: That is not the only thing that makes San Diego powerful. It could but it does Pope -- the chair could alternate between the cities. It could be San Diego. Under current situation, you have the mayor who is in line to be the next chair. That is the smallest city of Kent. You could have the mayor in future and it could be the same thing for MTS. This bill, while it does include some serious reforms and it also makes the mayor of San Diego more powerful. AB: Mayor top note has been completely absent. He has chosen to sit out a load voters take his place. He has shown no appetite to be involved. MS: There is lot to watch moving forward. We're going to move on and talk about transit. The trolley arrives in leaves without you. Help may be on the way. Plus about something about the new app that is being launched. AB: It has a name called Compass Cloud. You can use it to buy daily passes for monthly passes. You cannot buy single rides on the bus or trolley. It does have limits. There are plans to add that capability further on. The reason that is difficult to offer single rides is that they charge you for every bus route you take. If you buy a single ride, you can use that ticket twice on two different bus routes. You can cheat the system. MS: What do critics have to say? AB: They say what I was just saying. Single rides should be available to pay for transit fares. It comes down MS: and transfers? AB: Yes. It comes down who is up for. The people who use the daily passes in a monthly passes that -- it tends to be the transit dependent. Those people who have a car but want to go out and take the bus for drink downtown and take a car home, they are left out of the equation and they are the ones who will have to choose to ride public transit if they hope to meet the climate action goals. ASJ: What is the problem with the core values where you have a ticket and you can punch it like any other big city? ASJ: That seems to be something that is promising but what is the holdup? MS: It seems to be delayed. AB: That is part of the compass card that you carry your wallet. This was promised 10 years ago when this was just an idea. It is part of the system that they purchased. They have chosen not to activate it. They have tested it for a while. It seemed like it was not a priority. We do not need to do this. It is not useful. Partially because they see public transit still as something for the transit dependent. MS: Other cities are able to do this. JP: Can you put a projection on that? [ Laughter] AB: It could be a risk. You can say we are going to invest in this. They already paid for the system. All they have to do is figure out a revenue sharing agreement with the county. They have to do trial runs and they tried that. They came across some glitches and through their hands up. Now, I think after reporting, they are saying we're actually going to do this. They have compass cash and you will see it when it comes. MS: Ridership is down. AB: Yes. MS: It was big a couple of years ago but it is falling. AB: Right. There were a lot of factors involved. The economy and more people have jobs. They do not need public transit. San Diego, barring any major changes, we are headed for a spectacular failure of the climate action plan goals. Huge numbers of people have to switch from driving to walking and biking and public transit. Without a big change, I do not see that happening. [Indiscernible - multiple speakers] AB: We used to have streetcars before. We had more public transit in San Diego back in the day. MS: We will see how this plays out as we go forward. There is constant public discussion and debate about the shortening of affordable housing. It tends to focus on new affordable units are being built. Overlooked is how they are being lost your. Start by telling us what affordable housing means. ASJ: That is one that is being subsidized with tax credits. It has to be given to some someone who makes less than the median income. That is quite high. For a family of four, you could qualify for an affordable place. MS: It takes a long time to get in? ASJ: The waiting list is incredible. Some waiting list closed because there is no point in taking more names. Sometimes it is years. It is just the same as the voucher system and sometimes you have to wait for 10 years. Either way, you get a voucher and you can have that help you. It is long waiting list. MS: How do they get built? To developers get a sweet credit on the front-end and have to make a commitment? ASJ: Yes. That is right. The reason people want to invest in these is that they get a tax credit. If they load the money, they get a tax credit, which will help them pay their taxes. There are changes with the trump administration that likes giving people tax breaks. They will probably increase the tax credits available but if you lower the taxes overall, each credit is worth less. MS: You were talking about how we are losing some of these units over time but never mind we are not building enough. Some of the older ones are going back. ASJ: It is interesting. The incentives are not there for people to look at if it is cheaper and faster to renovate existing affordable housing and extend its life. The State Department asks every city, what is your plan and how many houses will you build. You can gain credits by saying I produced this number of new affordable units. If you lose more of those units of the back door, there is not anybody keeping track of how many units have been lost. It does feel like the system needs to be tweaked so there is an incentive to retain it. MS: You have nonprofit developers who were trying to do this? ASJ: Yes. There are people doing that at the moment. It is competitive and you know how difficult it is to buy property along the coast. They are keeping an eye on everything. This is still deed restricted to low-income people. It is worth it for them to buy the property and invest very little and weight 50 years and turn it back at market rate. MS: We have a bite from Anne Wilson talking about this. She was mentioned in this. AW: If someone else purchases the property, they would've lost 200 nice apartments. They are nice. There were nice when we purchased them. We renovated them that hundred families would've lost affordable housing. That is a big number. ASJ: Well, up until now, that tax credits have been less competitive than the ones for new buildings. Now, I think they realize that renovation is a good way to go and those are being used. It relates to the news that broke about father Joe's village, which he is talking about building 2000 new units. They are doing it by building new and in some cases renovating old motels, which is a great idea. MS: We have to look at the details on how that plays out as we go forward. You interviewed residents. What do they say about living there and what might happen? ASJ: Having talked to them, many have no idea how fortunate they are. One woman told me that she had a waiting list of a month to get into a unit. Now, the waiting list is years. It will be bought from a former developer and turn it to a market rate unit. They have almost certainly lost their home. AB: How does that work? If your income increases, do they kick you out? ASJ: That is the case. I think the community housing Works. They are doing classes with people to try to encourage them. Here is how you apply for a job and here is how you build your wealth. It is possible to break out of the cycle and get your own place. There's a combination of education going on in these apartment complexes and the tax credits require that you have education programs as a part of your program. People do not just get stuck. MS: We have to see what happens going forward and especially with father Joe. We will move on to San Diego. MS: Oakland lost the Raiders to LA before and they are moving again to Las Vegas. There is a petition drive supporting a major league soccer team and it is going. There is the only big league team is in rebuild mode. Start with the Raiders. They are going to Las Vegas. How much will the public put up in Vegas? JP: It is a lot of money. Just send baby just send. JP: It is amazing. $750 million. MS: That is public money. JP: It is making it rain for the Raiders and they are on the move. The key is public money. You talk about this. If the NFL owners, they do not leave public money on the table. MS: We have a bite for the Commissioner and what he has to say about the deal in Oakland. Commissioner: We work very hard and we never want to see a relocation of a franchise. That means exhausting options to get a solution in the existing market. MS: That is not what they were saying but what about that? Packet is amazing he can say that. There is one franchise. NFL has three in 14 months. It is what it is. It is a money chase. NFL is looking to do a fair deal they want every nickel on the table. AK: Two years ago, is starting to become clear that St. Louis and Oakland and San Diego situation was about to be resolved. We're going to get this. We are at the end of it and preteens located and two relocated. Is remarkable that the league was so unable to come to an agreement that preserved and existent one. MS: Follow the money. JP: They play the numbers game. You were not in the LA market for 22 years but during that time, we had $8 billion worth of government funds. They will not leave the money on the table and it is curious. They tried to the good listening tours that we are there for the fans. It is a bunch of hogwash. MS: It looks like the people pushing this stadium; they are getting a lot of signatures? JP: Yes. I think we were amazed at how many they got. I know we talked about taking and maybe they said would you like to kick here I don't know. They got the signatures? What they are in the move. It is an exciting sport. People play soccer and he did not have to watch it. I am not from there. I think it is an exciting sport if you can take care of San Diego, there is a win. I have not read all of the pages of the proposal. MS: We went to the Internet to name this new team. We came up with "Footy McFooty Face”. JP: Yes. That is leading quite a bit. I think one was Bob the boat race in England. They were having fun with it but it is appealing. Sitting around and go down and wait for the NFL to come back. That is a long time to wait. It is not football. It is soccer. MS: There are a lot of moving parts that plays into it. It’s not just the stadium but maybe the campus and other things. AK: There is also public land that is worth a lot of money. JP: We do not know how much it is worth it JP: The pricing is such. MS: Let's turn to the major league team. It is the Padres. JP: They are not going to sneak up on you. A lot of people say he wrote to 100 in six months. They are predicting that. They are a young team. The slogan down there is embrace the process. It will be a process to get back to 500. We will save the fans at patients. MS: We had a big push that they signed some big-name people as some they are pain. That went away and it did not help with the winning season. Is their excitement out there? JP: You really have to buy into I will watch these kids grow and see their progress. And say I was here with they were All-Stars. That is a lot to ask for franchise that has come off of six losing games. It is interesting to see how it turns out. It amazes me that they have -- they are pain for more not to play then they do that play. We do have the ownership group. Micah was the president was let go in the off-season that we had the general manager. They have faith in him. We're not going to be able to judge it for a couple of years to see if he is right or wrong. The expectations are not there but they do have a nice ballpark. MS: Andy Greene is a young guy. You know, when you go see the team, there is probably an ex-Padre there. A couple of seconds left, with MS: great expectations would be a 500 season. JP: Yes. That is if Andy Greene's managing. MS: We will see how that happens. I would like to thank my guest Andrew Keats and Andrew Bowen, Allison St. John and Mark Saur – A reminder, all of the stories we discussed are available on our website at Maureen Cavanaugh. Thank you for joining us today on to the Roundtable.
The San Diego Association of Governments, or SANDAG, kept quiet for more than a year after discovering it had relied on outdated cost projections and miscalculated revenues for its successful 2004 TransNet tax measure.
Voice of San Diego reported last October that SANDAG was at least $1.75 billion short of funds for the TransNet projects it promised voters.
Further, it used the same faulty revenue projections for 2016’s Measure A, which was defeated.
SANDAG board members, who are elected representatives of the area's cities, have said they were just as in the dark on the status of TransNet revenues as the voting public.
SANDAG is in the process of finding a firm to investigate what it did or did not do and why.
RELATED: Seven Firms Competing For SANDAG Investigation Contract
Two San Diego legislators have offered legislation to reform SANDAG. A bill from Assemblywoman Lorena Gonzalez Fletcher, AB 805, would do the following:
—Make each city’s vote proportional to its population.
—Make the mayors of San Diego and Chula Vista the permanent chair and vice-chair of SANDAG and the Metropolitan Transit System.
—Mandate that the representative from each city be the mayor, not a council member.
—Create a SANDAG audit committee and an independent auditor.
—Make it possible for the MTS and the North County Transit District to levy their own transit taxes.
RELATED: Gonzalez Bill Would Reform SANDAG — and Make San Diego's Mayor Way More Powerful
A bill from Assemblyman Todd Gloria would allow SANDAG to tax a smaller area within the county.
RELATED: SANDAG Sat for a Year on News That Transnet's Price Tag Rose by $8 Billion
Transit hits and misses
San Diego adopted its Climate Action Plan in December 2016 with the goal of shifting commuters away from cars and toward public transit. The city's plan calls for 12 percent of those living near transit stops to take a bus or trolley to work by 2020.
But in 2016, San Diego's Metropolitan Transit System logged 4 million fewer passenger trips than in fiscal 2015, and ridership for fiscal 2017 is also down.
RELATED: San Diego's Public Transit Growth Hits Speed Bump
The North County Transit District is also losing riders. It estimates its ridership is down 3.7 percent this year and is moving to eliminate some bus routes.
The downturn in transit takers is a national one, fueled by low gas prices and ride services like Lyft and Uber.
In the past, MTS has not made it easy to use the trolley or bus. But this week, both MTS and NCTD are launching Compass Cloud for the purchase of monthly or daily passes. Riders still cannot store value on this app to purchase single-ride tickets, and they can't get transfers.
RELATED: MTS Launching Mobile Ticketing App — With Limits
To meet its climate goals, San Diego will also have to change its policies to encourage density and transit-oriented development.
Not happening, say many community planning groups, which oppose density and taller buildings.
The case of the disappearing affordable houses
San Diego County has lost 3,500 affordable units in the last 20 years and may lose 2,000 more in the next five years.
Housing is considered affordable if it is priced for and available to people who make below 60 percent of the median income in the area.
Affordable housing includes HUD Section 8 units and units built using low-income housing tax credits. These must remain as low-income units for up to 55 years. After that, they can revert to market rates. They are, therefore, very desirable investments for for-profit developers, who buy the units and wait out the restrictions.
But there are nonprofit developers who compete in the market, find the financing and put the profits into renovations, rather than to investors. These developers, such as Community Housing Works, preserve these units and keep them from being bought up by private equity firms.
RELATED: NonProfit Developers Strive To Preserve Affordable Housing
The Las Vegas Raiders
Many San Diegans were thrown for a loss when the NFL allowed the Chargers to move to Los Angeles. But their loss was nothing like Oakland's.
RELATED: The N.F.L. and the Business of Ripping Out the heart of Oakland
That city, which endured a previous move by their beloved Raiders to LA, had offered the NFL 55 acres for a stadium, private financing and major improvements, a great deal by most standards.
But Las Vegas, scorned for its gambling culture by major league sports for decades and anxious to diversify its economic base, raised taxes for a $750 million public subsidy for a new stadium.
At the same time, the city's school district increased class sizes and closed a school for at-risk kids because of lack of funds.
Under the Oakland deal, the Raiders and the A’s, the city's major league baseball team, would have had homes in neighboring stadiums. But the NFL wanted the city to evict the A’s, which have been in Oakland since 1968. The city said no.
In San Diego, the Padres are rebuilding this year, but then, when aren't they lately?
RELATED: NL West preview: San Diego Padres begin deep rebuilding
Star first baseman Wil Myers is still here, one of the few holdovers (there are 83 million reasons for that).
But General Manager A.J. Preller is counting on Latin American players and the draft to do the rebuilding. This is going to take a while.
Meanwhile, FS Investments continues to gather signatures for its "Soccer City" plan in Mission Valley. They have roped Landon Donovan, one of America's few genuine soccer stars, into the ownership mix.
RELATED: Petition Drive To Bring MLS To San Diego Gets Underway
The one big mistake they have made thus far: asking the internet to name the team.