Why did the Sunroad Controversy get so Political?

Preamble

At one of the recent press conferences, a reporter asked "Why did the Sunroad controversy get so political?" Because I (Rick Beach) have been maintaining the timeline and archive of documents in the Sunroad controversy, and because I was an outsider to the process yet intimately aware of what was in the documents, I drafted this white paper.

Money and Influence
An Inconvenient Hazard
At First, Ignore Somethin
Then Attack Something
Awakening the Public Outcry
The City with Two Brains
The Influence Never Stops
Sunroad Goes to Washington
Will Somebody Please Follow the Rules?
Sometimes it Helps to Know Someone
You Know What I Mean
Why Did the Sunroad Controversy Get So Political?

Money and Influence

I dunno about what's political, but I do recognize money and influence.

So, why did the Sunroad controversy involve so much money and influence?

Because I believe that Sunroad Enterprises chose to use money and influence to get around an inconvenient decision: their Sunroad Centrum complex is too high and too close to an airport.

Centrum is only one of several developments near airports in San Diego: Sunroad Centrum office tower complex near Montgomery Field, Sunroad Harbor Island hotel tower complex near Lindberg Field, and Sunroad Otay Mesa mixed residential, business and industrial complex.

Recall that Sunroad Centrum is 1,000,000 square feet of office space squeezed onto 10 acres in three tall 12-, 14- and 16-story office towers. That involves a lot of private profit.

The Inconvenient Hazard

Sunroad Centrum 12 is a hazard to air navigation.

The FAA made that determination under duress in August 2006. Sunroad did not provide the required notice and failed to resolve the preliminary determination before reaching the maximum height. Sunroad failed to appeal the FAA determination. Sunroad was the only developer in the country to ignore the FAA and build anyway.

Sunroad Centrum 12 is a public nuisance.

In California, the Legislature acted to define a hazard to air navigation as a public nuisance. Building such a hazard also requires a permit from the California Department of Transportation Division of Aeronautics. Sunroad was the only developer in the state to ignore state law and build anyway. In 30 years!

At First, Ignore Something Inconvenient

After the FAA determination was issued but before the hazard determination was final, Sunroad addressed public opposition from the aviation community. In early September, Sunroad presented its arguments to the City's Airport Advisory Committee. A key statement:
"the local jurisdiction [City of San Diego] has complete discretion in approving or disapproving projects, and is solely responsible for establishing structure heights within their jurisdiction. The FAA will modify flight procedures as necessary to accommodate structures approved by the permitting authority."

In other words, we got our permits from the City of San Diego so we are not concerned about the FAA.

Then Attack Something Inconvenient

In October when Caltrans Division of Aeronautics asserted that it was unlawful for Sunroad to proceed with construction, Sunroad went into frontal assault mode.

Their attorney scolds Caltrans because a) there is no hazard now that the FAA issued a notice to pilots, b) local zoning laws can't be restricted by state law, c) the project is not in an airport influence area, d) attempting to enforce state law exceeds their jurisdiction, and e) aviation concerns must be balanced with development benefits. Ouch!

Unfortunately for Sunroad, while this exchange was taking place, the time limit for appeals to the FAA expired. The hazard determination was now final.

Awakening the Public Outcry

The arrogant and contemptuous attitude displayed by Sunroad executives, consultants and attorneys during their public presentation in early October stirred an equal and opposite reaction.

Sunroad was obviously spending lots of money on attorneys, lobbyists and consultants. They had the arguments they paid for.

The volunteers on the Airport Advisory Committee were lectured, dismissed, and told to "deal with it" now that the building had reached its maximum height. When asked for an explanation of the Sunroad action to agree to a lower building height of 160 feet, the attorney responded that "this is not a grand jury investigation" and failed to answer the question.

The Airport Advisory Committee may be volunteers, but they are also quite knowledgeable, equipped with a variety of sources and connections, and especially passionate about improving the two City airports.

The AAC immediately acted to advise the Mayor, who as "strong mayor" runs all City functions including airports, that we supported Caltrans in denying Sunroad a permit.

The City With Two Brains

Following the FAA, Caltrans and Airport Advisory Committee actions, responses by the City split into two divergent paths: one based on legal liabilities and the other based upon economic accommodation.

Coincident with the Sunroad controversy, another controversy over the Airport Enteprise Fund set the stage for economic accommodation. Early in the Sanders administration, the City acted to extract greater benefit from operating its two airports. Unfortunately, because of past egregious behaviors by airport operators, federal regulations protect airport revenues by requiring any airport that receives federal grants to segregate all airport revenues and spend them only on airport expenses. Jim Waring came to the AAC and expressed his frustration with these restrictions. In his opinion, this lack of accommodation with the realities of City economics doomed municipal airports.

To Waring, it was obvious that a $45,000,000 office tower development was such a great economic benefit that restrictions due to nearby airports could not make any sense at all to him. One City brain clearly questioned any restrictions and was oriented to find accommodations to let development proceed.

In late October, the other City brain called for actions to protect the City against liabilities for failing to protect public safety. Caltrans had put the City on notice that Sunroad was liable for accidents due to their actions. The City provided the permits so it too bore some liability. The advice: stop work until the hazard and public nuisance issues were resolved.

The Influence Never Stops

Given the legal advice that the City was liable, a stop work order was issued. For a mysterious top 17 feet.

Instead of using the height of 160 feet above ground used by the FAA, or using the 20 feet penetration height, the stop work order in October says 17 feet. That's the approximate height of the top floor but does not accommodate the 10+ feet of the equipment penthouse on top of the roof.

Influence or incompetence? I don't know. But weird.

More troubling was what the other City brain did with the October work order. Jim Waring and Steve Strauss began negotiating a way to circumvent the stop work order. Jim Waring heads the City development division. Steve Strauss is a registered lobbyist for Sunroad and a key attorney for Cooley Godward who represents Sunroad.

In early December, Waring and Strauss exchange drafts of an agreement to allow construction to continue. Waring adds language that refers to all construction being "100% interior work and none of the work will raise in any manner the current height of the building, including an increase by mechanical systems or housings." Strauss deletes the reference to 100% interior work because the mechanical equipment is on the roof and the enclosing walls and windows are not interior work. Ultimately, these negotiations result in the infamous "weatherizing" agreement in late December.

Despite these two stop work orders, the building appears complete.

Sunroad Goes to Washington

If you don't like the rules, then go to Washington and change the rules.

In November, Sunroad hires a Washington lobbyist who arranges a meeting with the FAA. Even though the hazard determination is final, Sunroad pleads for changes to flight procedures that would allow all of their office towers to be built.

Sunroad offers to pay for an expensive landing system that would reduce the conflicts between airplanes and their buildings in bad weather. But other flight procedures would need to be changed for good weather. And there are environmental issues to consider. Nothing is easy.

Will Somebody Please Follow the Rules?

While these discussions are proceeding privately, the public safety issue is going nowhere.

The development side of the City brain is clearly not responding, asking why make an issue of 20 feet. Sunroad is clearly not responding, claiming that they did nothing wrong and they have all the permits they need.

So, we have an accident waiting to happen and no action to resolve the City liability due to public safety concerns.

In mid-December, the City Attorney files suit calling for Sunroad to obey the federal and state laws by lowering the building and calling on Caltrans to enforce state law by abating the public nuisance created by Sunroad.

Of course, Sunroad promptly counter-sues for $41,000,000 in damages.

Now, the courts will decide.

Sometimes It Helps to Know Someone

Just recently revealed in June, we learn that in December immediately after the lawsuit was filed and two days before the "weatherizing" agreement, the owner of Sunroad met with the Mayor. Not a public meeting. Just four people on the calendar. Aaron Feldman and Tom Story from Sunroad. Jerry Sanders and Jim Waring from the City.

They didn't resolve the lawsuit. They didn't eliminate the hazard. They didn't eliminate the public safety concern.

What did happen after that meeting was allowing Sunroad to complete construction of the building. What did happen after that meeting was presenting ideas from Sunroad by the City to the FAA to create a "Sunroad no fly zone" so Sunroad could build all three buildings.

You Know What I Mean

So money buys consultants and lawyers and PR spin. So influence shapes what gets attention.

But somehow, people find out and start asking questions. The truth will out.

Then the influenced and bought seem to have trouble with what they say.

Yes, we are committed to public safety. But our actions show that private development takes priority.

Yes, we have nothing to hide. But we hope you don't find out about our secret meeting with Feldman, our confidential settlement discussions without our attorneys present, or our undisclosed presentation to the FAA.

Yes, we worked with the Airport Authority. But we hope you don't discover that we needed their expertise to convince the FAA to help Sunroad.

"Nothing can be further from the truth." Except what the Mayor's communications person just told you.