Judge gives tentative blessing to plan to fund convention center expansion
Plan would charge hotels a percentage of rates
Last Updated: 72 days ago
SAN DIEGO - A San Diego Superior Court judge on Monday gave his tentative blessing to a plan to fund the expansion of the downtown convention center.
The city of San Diego filed the validation lawsuit because, according to City Attorney Jan Goldsmith, the plan to charge owners of hotel properties a percentage of room rates on a sliding scale entered a gray area of the law.
A citizens group called San Diegans for Open Government and civic activist Mel Shapiro joined in the court action to challenge the plan. Mayor Bob Filner also does not endorse the idea, calling the tax a private benefit for private business without a public vote.
Judge Ronald Prager ruled that the election of hoteliers to assess themselves "conformed with all applicable constitutional provisions, statutes and ordinances." His tentative ruling turned aside nearly all of the opponents' arguments.
However, the judge is scheduled to hear oral arguments on Wednesday. Afterward, he will issue a final ruling.
"I was confident that the City Council moved forward appropriately with our approval of the expansion's financing last year," council President Todd Gloria said. "The judge's validation confirms that the hotel room surcharge agreed to by local hoteliers is a legal and viable way to improve our convention center and further strengthen San Diego's economy."
Under the plan, downtown hotels would be charged 3 percent of room rates, those in Mission Valley and Mission Bay 2 percent and outlying facilities 1 percent, with the money funding most of the expansion.
When the construction work is complete in three or four years, the San Diego Convention Center will have the largest amount of contiguous floor space on the West Coast, according to the city. The expansion would add more than 220,000 square feet to the 24-year-old structure.
"It's good news, great news," said Jim Durbin, who operates the Gaslamp Marriott Hotel and is on the board for the San Diego County Hotel-Motel Association. "We agreed to put up a lien on our properties as part of the vote for yes on this."
Area tourism officials say organizers of the biggest trade shows have been bypassing San Diego because the local facility is not big enough. Comic-Con International, which originated in San Diego, had been courted by other cities but chose to remain when an expansion was promised.
Opponents of the financing plan contended that the assessment was a tax, which requires two-thirds approval in a public vote. The judge, however, agreed with the city's argument that since the tax applied to the hoteliers, they were the ones who should cast ballots.
The San Diego Regional Chamber of Commerce endorsed the plan as well, saying the expansion is a job creator.
"There will be 6,000 jobs or more created at a time when sequestration could take the same amount of military or defense related jobs out of San Diego," said Mark Leslie, the chamber's interim CEO and president.
The Chargers, in the meantime, were hoping to roll an expansion into a combined sports complex as a way to fund a new stadium.
Team spokesman Mark Fabiani said, "There is a long way to go before we have to look at a Plan B."
Though one legal hurdle has been cleared, the project still has to receive approval by the Coastal Commission.
Copyright 2013 Scripps Media, Inc. City News Service contributed to this report. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.