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Bill McCrone has a question for the folks at City Hall, and it’s a simple one: What’s the hurry?

Specifically, why are city officials renegotiating lease terms with Chris Shake for the Fisherman’s Grotto on Fisherman’s Wharf, where the city lease doesn’t expire until 2021. And why are they renegotiating lease terms with the Surfside entity for the London Bridge Pub property at the foot of the wharf, where the current lease still has 20 months to run.

Those renegotiations are the topic of a closed-door meeting of the council tonight.

McCrone is a former planning commissioner and longtime critic of the city’s leasing practices at the wharf, which he has researched extensively. In a letter to the city, he notes that the City Charter requires the city to collect fair market value on its properties. He asks how the city can calculate fair market value so far in advance.

“The California Constitution and numerous other state and federal laws prohibit government officials, elected or appointed or employed, from giving away public property for less than adequate compensation to the public.  If you extend these two outrageous ‘ground’ leases or enter into new leases at less than FMR (market value), you will be defrauding the public and giving public property to private persons for free,” McCrone wrote.

McCrone, a retired lawyer, also argues that Surfside holds the master lease on the pub property and profits handsomely by subleasing the property, performing little or no service of value in the process. He says that’s a violation of city regulations.

Surfside, headed by the Cannery Row Co.’s Ted Balestreri,  “is doing nothing more than managing a well seasoned property but receives 60% to 70% of the rent for management.  Five % to 10% is the market rate for commercial property management.  No matter how you paper it, extending Surfside’s management for more than 10% of gross rents is a fraud on the public,” McCrone wrote.

“The good ole boys are at it again.  The dust has hardly settled on the recent election before they have once again forced their noses under the tent to reap enormous public subsidy for their commercial operations.  The reasons to refuse this premature negotiation are now more numerous than they have been the past two or three times the Council has refused their requests.”

The Partisan emailed various city officials this morning to ask why the city would consider renegotiating the leases early. City Manager Mike McCarthy replied only that that was something under consideration. The Partisan could not determine late Tuesday what if any action the council had taken.

The City Council two years ago began efforts to reform leasing practices at the city-owned wharf, largely because several longtime leaseholders were operating at sweetheart rates bestowed on them decades ago. In some cases, those leaseholders are profiting handsomely by subleasing the properties, with none of the profit going to the city.

Wharf tenants responded with a public relations campaign accusing City Hall of seeing to out local businesses and replacing them with chain operations able to pay more. The businesses also complained that the city was seeking the shorten the length of the leases, making it difficult for the tenants to obtain financing. A handful of leases have expired during the debate and the city is negotiating with Bay Area firms to fill a couple of the spaces, but city officials maintain they recognize the value of unique, local operations.

The merchants’ resistance to various reform measures was fortified in November when longtime Councilmember Libby Downey, a leader of the reform effort, lost her re-election bid. She was ousted by Dan Albert Jr., the former school official who received considerable financial support from wharf interests. For practical purposes, the wharf interest generally enjoy support from a council majority.

In his letter, McCrone argues that any council member who has received more than $500 from wharf interests should recuse themselves.

“You ought to pass an ordinance to limit campaign contributions,” McCrone wrote. “Your self-serving failure to do so has initiated a strong sentiment among citizens to take this issue to the polls with a charter amendment.”

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The case for campaign contribution reform grows with each passing election.

Take the city of Monterey, for instance, where a reform-minded city councilwoman, Libby Downey, was knocked out of office in November by an opponent who raised nearly six times as much money, much of it from a segment of the business community that Downey had tangled with.

The successful candidate was Dan Albert Jr., son of the longtime Monterey mayor. In a three-candidate race for two seats on the council, he pulled in $53,365 compared to $9,411 for Downey and $8,549 for Alan Haffa, who retained his seat.

Downey and Haffa have led the city’s efforts to reform leasing practices at city-owned Fisherman’s Wharf, where some longtime tenants who negotiated sweetheart lease deals with the city decades ago are allowed to sublease the space to other businesses at greatly increased rates without the city receiving any share of the additional income.

The effort to change that and other practices has been met with furious resistance from wharf tenants, who have repeatedly  accused city officials of attempting to turn the wharf over to chain restaurants at the expense of local, family-owned operations. With Downey’s departure, the city has softened its approach to negotiating more taxpayer-friendly leases at the wharf. The city’s resolve weakened further when Councilman Timothy Barrett, previously in the Haffa-Downey camp on the issue, was somehow persuaded to switch sides. Haffa is now expected to be outvoted 4-1 on wharf matters, so the established wharf interests appear to have regained their grip on  city leasing policy.

Albert’s contributors listed in the most recent campaign spending reports include the Monterey Commercial Property Owners Association, $2,500; and two closely related entities, the Monterey Bay Action Committee and the Monterey Hospitality Association, $5,000 apiece. The $5,000 contributions came after the election and were presumably intended to help Albert build his treasury for a re-election effort. He also took in contributions from Monterey Fish Co., Randy’s Fishing Trips, the Cannery Row Co., Portola Hotel, Marriott Hotel and lawyer Tony Lombardo, who represents the Shake family interests on the wharf.

Incidentally, or not, in his previous role as associate superintendent of the Monterey Peninsula Unified School District, Albert was an active participant in the pay-to-play system of awarding school bond contracts to companies that provide most of the financing for school bond measure campaigns.

The Monterey district was not alone, of course. School districts throughout California and beyond traditionally financed bond campaigns with contributions from bond underwriters and construction companies that would directly benefit from the resulting school construction contracts. In California, the state Treasurer’s Office only last year enacted regulations that prohibit contracts from being awarded to the firms that financed the corresponding bond measures. Bonding companies can still contribute to bond measure campaigns but they cannot then recover their investment directly by receiving contracts in the same communities.

No one has accused Albert of any illegal or unethical activities. The connection between school bond campaign financing and subsequent contracts has been so clear for so long that the built-in conflicts of interests were widely viewed as a necessary cost of getting schools built or repaired.

While Albert was the local school district’s chief business officer, his wife, Sharon, ran the successful Measure P campaign that raised more than $100 million in 2010, and she received considerable and justifiable praise for her efforts. With district officials barred from direct involvement in bond campaigns, companies that went on to receive sizable construction or finance contracts contributed the bulk of the money needed to persuade voters to approve the MPUSD bond program. A sizable share of the resulting construction work went to campaign contributor Harris Construction of Fresno, now under investigation for a bid-rigging scheme in Fresno. Others contributing to Measure P and then benefiting from the construction program included the Piper Jaffray and Stone & Youngberg bond firms, Keygent Advisers, a San Francisco bond counsel and a Fresno architecture firm.

Efforts to limit campaign contributions locally have surfaced from time to time but most have sputtered as local political action committees such as the Monterey Bay Action Committee and the Salinas Valley Leadership Group have stepped up to support the most commerce-friendly candidates. At the moment, however, momentum appears to be growing for new, tougher rules that would affect candidates for the Monterey County Board of Supervisors.

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All was not lost on election day, at least not locally

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edit_14232393_1166055086801312_6162782396031943489_nOn the way home from therapy on Wednesday, I stopped along the highway to pick up an election souvenir, a green-and-white YES ON Z sign. It now rests next to my computer as a reminder that all is not lost, that sometimes the good guys win.

I’m sure I will look at the sign often while reading about the latest groaner from the Trump administration. I am hoping that it will ease my despair and keep me focused on the positive and the local.

While the national election was an unmitigated disaster, it was a mixed bag locally. You had to look closely for the positives, but they were there.

Measure Z, of course, wins first prize for greatest success in the face of overwhelming money. It was the anti-fracking measure and you know all about it so I’ll spare you the normal details except for how the oil industry spent at least $5.5 million to fight it. (I’m hoping our friends at KSBW and elsewhere in electronic media spend their campaign advertising fortune wisely.)

Co-conspirator Larry Parsons and I made the rounds of election parties Tuesday night. We tried to stop by the Measure Z party in Salinas but a goodly share of the Measure Z camp is, well, it’s older now and the lights were off before 10 p.m.

We did stop by the Yes on Y affair. Medical marijuana, another ballot winner. I thought for a minute we had made a wrong turn and had ended up at a Pebble Beach Food & Wine after-party. There were lots of very pretty people, young and well dressed. I didn’t recognize anyone.

Monterey City Councilwoman Libby Downey’s party nearby was a quieter affair filled with older folks in comfortable clothes. Libby was just as gracious in defeat as she always is, saying that if Dan Albert Jr. had to knock one of the progressives off the council, which he did, it was better that it wasn’t Alan Haffa. For Downey, being on the council has meant also being on the mayors water authority and the boards of TAMC and the transit authority and the sewer board, etc., etc. It has meant almost daily meetings and lots of work. She deserves a standing ovation as she steps aside.

The Seaside results can be interpreted in different ways. I see it as a victory for common sense because even though Ralph Rubio will stick around as mayor, the fact that he didn’t receive an outright majority tells me that the people of Seaside aren’t so keen on the Monterey Downs project. Kay Cline came in a close second on a platform led by her opposition to the racetrack/housing venture. Give her the votes of the other two candidates and she would have won.

Cline’s party at the Press Club was upbeat even though no one in the room was enjoying the national election coverage on the bank of TVs.

Supporting my Seaside thoughts was the defeat of Councilman Ian Oglesby, who once was a promising newcomer but who fell into the trap of doing what Ralph wanted him to do. He will be replaced by Kayla Jones, a rising star with a progressive view of Seaside’s needs. Dave Pacheco was re-elected, a good thing because every council needs someone who is only looking out for the people.

Seaside was the setting for Sen. Bill Monning’s intimate victory party, populated mostly by campaign workers and elected officials such as Jane Parker and Mary Adams. Mel Mason was there, looking well. The Monning affair was at DeMarco’s Pizza, my go-to place for pizza. Monning and Haffa are also regulars there and you should be, too.  (This is what they call a plug. DeMarco’s is on Broadway (Obama Way) across the street from Goodwill.)

In Salinas, the big news was that odd-man-out Councilman Jose Castaneda is all the way out, finishing fourth in a four-way race for his seat. All went as expected in Pacific Grove. Nothing new there. Same with Marina, though it was gratifying to see Kevin Saunders fall flat, especially after he lobbed some anti-Semitic nonsense at Weekly editor Sara Rubin. Go off somewhere and torch one, Kevin, and leave the rest of us alone.

The Hartnell bond was approved and the transportation tax may have been approved. It needs two-thirds approval and had almost exactly that as of last count but there are thousands more ballots to count before we rest.

Could have been worse. Not nearly good enough to salve the sting of the Trump victory but good enough to keep some good people in the game for a few more cycles.

Congratulations to the Measure Z camp, especially Jeanne Turner, who did a remarkable job of organizing the petition drive and keeping her colleagues focused.

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