Ten Reasons to Vote "No on A" in Carlsbad's Special Election

The "Riehl" Voters Guide

A guy carrying a clipboard appeared at our front door June 25th last year. He said he was a member of a citizens group on a mission to save the strawberry fields. After he promised there would be a vote on the initiative, I signed it. A few days later, discovering I'd been duped, I was driven by anger and guilt to launch my own mission: to write about a lying developer's attempt to bypass, not only state and local reviews of his project, but Carlsbad voters.

What follows is a list of reasons I voted no on Measure A, with links to the articles I posted on my blog, The Riehl World, over the last eight months. They tell the story of how a billionaire L.A. developer persuaded elected officials to agree to put our city's quality of life at risk. On February 23 we'll find out if he succeeded.

1. Dishonest "citizen-led" initiative campaign

The Agua Hedionda 85/15 Specific Plan Initiative was launched by a trio of residents hardly representative of the city's diverse community: the only volunteer on the lagoon's foundation board, composed mostly of corporate executives, like the owner of the land the developer wants to buy (SDG&E,) and the developer Rick Caruso's own corporate representative; a former CEO of the Carlsbad Chamber of Commerce; and a former city planning commissioner.

Duped! The Signature Campaign for a Strawberry Fields Mall

2. Faulty air quality analysis

The city's 9212 Report calls for "further analysis of cumulative air quality impacts and documentation of construction emission and Carbon Monoxide hot spots assumptions." Not good news for trail walkers carrying inhalers.

Preserve Carlsbad's Open Space the Right Way: Let Us Vote

3. City Council ignores constituents, caves to corporate interests

On August 25th the City Council unanimously approved the developer's plan, refusing to allow a vote of the people as promised, or even a 30-day cooling off period to hear from their constituents.

Preserving Citizen-led Advocacy the Right Way

4. False claim outside interests funded referendum

Westfield Corporation's VP for Corporate Relations declared, "Westfield is not providing any support, financial or otherwise, to the referendum drive" after Mayor Matt Hall teamed up with Caruso to make that claim. They then invented other unnamed "outsiders," clueless that thousands of Carlsbad residents would be offended by the council's rude dismissal of their concerns at the August 25 meeting.

Have You No Shame, Mr. Caruso?

5. Dishonest promise to save the strawberry fields

On page 5 of the Specific Plan Description Appendix N "Transportation Impact Analysis" you'll find, "The site is currently occupied by the Carlsbad Strawberry Fields and other agricultural uses, and these will continue to operate in a different configuration and at a reduced level." It's no surprise the strawberry fields are not featured in the "Yes on A" campaign.

Carlsbad City Council Backs Caruso Bogus Claims

6. Barely seen in mailers and TV ads: a 13-acre mall

A shopping center is hard to find in the deceptive glossy mailer, "A Bird's Eye View of the Agua Hedionda Lagoon 85/15 Plan"

No Bird's Eye View of Nordy's-On-the-Lagoon

7. Campaign donations to council members

The owner of the Carlsbad Strawberry Company donated $5,000 to Matt Hall's 2014 mayoral campaign, $4,260 to Councilmember Michael Schumacher.

Click here to find the city's web page to campaign contributions.

Referendum Signatures Stun Caruso, City Council Pals

8. More traffic, more promises

If projections are too low local traffic will be a nightmare. If projections are too high because online retail customers continue their flight from large department stores, or another deep recession hits, the failed project could become Carlsbad's Stonehenge by the Lagoon, a legacy of city leaders who thought they could get something for nothing.

Carlsbad Report on Caruso's Lagoon Mall: Close Enough for Government Work?

9. Elected leaders give up control of amendments to the plan for 15 years

"The City Planner's sign-off, or refusal to sign-off shall be final. There shall be no administrative appeal of the City Planner's sign-off or refusal to sign-off."(Agua Hedionda 85/15 Specific Plan, 6.13.2.2, p. 153))

The one person responsible for approving amendments to Caruso's plan is three reporting levels removed from those we've elected to act in our best interests.

No, Mayor Hall, What We See is Not What We'll Get

10. Analysts agree revenue overstated, threat to small businesses understated.

The city's 9212 Report, (Table 5, p. 36), found Caruso overstated all projected revenues for the city. A second analyst found he incorrectly designated his proposed shopping center a “super-regional” mall, allowing him to expand the projected market area. Phony promises of a larger, wealthier customer base hide the likelihood of local small business failures.

Caruso Overstates Lagoon Mall Benefits Part 1

Consultants Agree on Inflated Lagoon Mall Benefits Part 2

Final Straw

Proponents of Measure A, as well as our mayor and city council, claim Caruso's project is the best we can hope for to cover those 48 acres of commercially zoned land and to get public access to trails and open space. Don't listen to them. The city has a lease with SDG&E to allow for a park and recreational uses, open to the public, in 90 acres of open space. Spurred on by the passing of Prop D, the city set aside $5 million to make that happen.

As for the 48 acres of commercial land, check out the "General Plan Table 2-4: Characteristics of Commercial Land Uses" on the city's website. You'll find many options more attractive than a shopping mall. What goes in there will depend on the wisdom and judgment of our elected leaders. Unfortunately, the current bunch seems eager to transfer their responsibilities to a billionaire L.A. developer.

Consultants Agree on Inflated Lagoon Mall Benefits Part 2

Retail Demand and Revenue Overstated

The Westfield Corporation donated $75,000 to the opponents of Carlsbad's Measure A, which, if passed, would enable an L.A. developer to build a mall near the city's pristine Agua Hedionda Lagoon.

The developer, Rick Caruso, has spent $7 million for paid signature gatherers in a misleading initiative campaign, out-of-town marketing consultants to develop a flood of glossy mailers and TV ads, staffing of an information center at the lagoon, and transporting local residents to behold the splendor of his L.A. mall.

The group opposing the billionaire's plan, Citizens for North County, has relied on an army of volunteers to gather referendum signatures, canvass neighborhoods, organize pop-up tents information meetings, use social media, put up handmade signs, and host fundraisers to pay for two mass mailings.

On election day, February 23, we'll learn if Caruso's Goliath campaign has been slain by David's citizen volunteers.

Skeptics say owners of the Westfield University Towne Center in LaJolla have a self-interest in defeating a market competitor's plan. But Carlsbad's City Council has its own political interests at stake. The mayor and all four council members have promised Caruso's development will cost taxpayers nothing, protect open space, and generate an annual $2.6 million windfall to the city. Donald Trump would call those campaign promises, "Yuge!"

Confining himself to an ad hominem attack on Westfield, Caruso ignored his competitor's 252-page peer analysis of his project, containing an economic/fiscal report by HR&A consultants. City officials also disregarded it. Had they read it they would have discovered the city's own consultants, RSG, and Westfield's HR&A, agree that Caruso's claims of economic benefits are grossly overstated. Their findings differ only in degree.

To estimate the area's excess retail demand, HR&A found, Caruso incorrectly designates his proposed shopping center a “super-regional” mall, normally defined as having a minimum of 1 million square feet of retail space with at least 3 department stores. Caruso's will have just one within 585,000 sq. ft. Mis-designating his mall allows the developer to expand the city's projected Secondary Market Area (SMA). By adding households Caruso deceptively produces additional excess retail demand, suggesting local businesses will not lose customers because of his project.

Caruso's bogus SMA expansion also generates higher annual average household incomes in the marketplace. The $85,000 average for Carlsbad/Oceanside/Encinitas rises to $103,000 when you include Del Mar, Rancho Santa Fe, 4S Ranch, Fairbanks Ranch, and La Jolla.

Overstating retail excess demand and household income is bad news for Carlsbad Village shops and restaurants. Phony promises of a larger, wealthier customer base hide the likelihood of a higher rate of failure for local small businesses caused by his new shopping center.

HR&A's analysis reveals an astonishing miscalculation, or intentional misstatement, of Caruso's projected annual increase in average household income in Carlsbad's retail market areas. Without any justification, the 1 percent five-year historical average jumps to 3.2 percent from 2014 to 2015, three times higher than any previous year-to-year increase.

Could it be the "mistake" was just the developer's means to an end to support his excess retail demand targets?

Caruso claims his shopping center will generate $200 million to $307 million each year in tourist spending, with no estimate of the number of city visitors. HR&A assumed an average expenditure of $80 per visitor, to produce an estimated 2.5 million to 3.8 million new visitors annually. Absent any documentation or comparables in other cities, it strains credibility to think his mall alone will more than double the estimated 3 million visitors to the city in 2013.

A 2,500-seat multiplex movie theater, residing on one acre of his 13-acre mall, was not mentioned in Caruso's promises of economic benefits. Maybe that's because there are now three multiplex theaters within 10 miles of his development and 20 more within 25 miles. That amounts to one for every 31,000 residents. There's one for every 48,000 in all of western San Diego County. The local theater market looks saturated to me, especially since they all seem to show the same movies at the same time.

In Carlsbad's Voters Guide you won't find any shadows cast on the developer's sunny promises For a fact check read my Riehl Voters Guide, to appear here next week, for a list of the top ten reasons to vote No on Measure A. Take it with you to the polls, or keep it by your side if you're voting absentee. Share it with friends.

Don't put our city's future at risk in the hands of a developer who promises to make Carlsbad's Carusoland look like the one he built in L.A, the one he says attracts more visitors than Disneyland or the Great Wall of China.

Caruso Overstates Lagoon Mall Benefits Part 1

Village Businesses at Risk

Carlsbad's Voters Guide for the February 23 Special Election promises the city will benefit from a $2.6 million revenue windfall each year if a new shopping center is built near the Agua Hedionda Lagoon. But the projected bonanza omits the caveats contained in a report that bypassed state and city approvals normally required of such projects.

The 9212 Report cites the analysis of RSG, a consulting firm hired by the city to examine the shopping center developer's promises. It found projected revenues were, "not based on valid data sources, appear significantly overstated, and should not be used for budgeting purposes. The tourism-related fiscal revenues to the City, estimated at $3.0 to $5.2 million, (by Kosmont, billionaire developer Rick Caruso's consulting firm) are not supported due to invalid assumptions." 

While that explains the city's more conservative $2.6 million estimate, voters should keep in mind it's an estimate only. The unexpected arrival of the 2008 Great Recession, together with the recent gloomy news from the stock market, prove high hopes are sometimes dashed by harsh reality. That's especially true if they're built on a shaky foundation of questionable facts, self-serving interests, and wishful thinking.

Here's just one example of Caruso's bogus promises. He claims 10 percent of mall visitors would stay at a local hotel overnight to shop and dine elsewhere in Carlsbad, defining as "visitors" those who come from outside city limits. That would include Oceanside, San Marcos and Vista residents, as well as others from cities within a short driving distance. Unless they're shopping addicts, nearby residents are unlikely to look for a hotel to give themselves extra time to shop downtown or visit the city's other three malls.

How will the mall affect businesses in The Village? The RSG analysis shows 47 percent less surplus demand than Caruso's estimate for shopper goods over the next 8 years, 70 percent less for food sales, and 58 percent less for eating and drinking. The report finds, "The retail service surplus demand is overstated but still positive," but  concludes with the warning, "A large retail project, the San Marcos Creek District, was excluded from the analysis and represents significant portions of the Specific Plan methodology that are inconsistent with best practices for estimating retail demand." 

If I were an owner of a downtown business, I would take no comfort in those words, nor with Caruso's claim my customer base would be unaffected by his mega mall. His promise of free transportation from his mall to my shop or restaurant downtown will also allow local mall-bound shoppers to park free downtown, walk past my shop, and hop on a trolley to Caruso's shopping center, avoiding the heavy traffic and high parking fees there.

Although the RSG analysis promises there will be some (my emphasis) economic benefits, the city's 9212 Report minimizes concerns about the developer's gross exaggerations. The Voters Guide makes no mention of them at all.

The city's website gushes about the questionable revenue projections, "If the city’s numbers are wrong, the city will see an even greater economic benefit." That explains the thinking of the collection of Pollyannas we call our city council.

Watch here for Part 2 of this article next week, a second consulting firm's analysis of Caruso's promises to Carlsbadians.   

No, Mayor Hall, What We See is Not What We'll Get

Carlsbad Braces for Special Election Vote on Lagoon Mall

As the February 23 special election approaches, Carlsbad voters may want to recall words spoken by Mayor Matt Hall and Councilmember Mark Packard at the November 17 meeting of the City Council. After signatures were ratified on a successful citizens-led referendum, the Council could either rescind its August 25 decision to allow a billionaire LA developer to build a shopping mall on the shores of the city's pristine Agua Hedionda Lagoon, put the issue up to voters in a special election, or put it on the ballot of the November 8 General Election.

The Council decided to spend $600 thousand on a special election. As on August 25, the vote was unanimous. The regular absence of split votes by this group on contentious issues suggests either unusually unified thinking or a careless observance of the Brown Act. If it's the former, a disregard of constituent diversity of opinion is a matter for voters to think about in the next election. If it's the latter, it's time for someone on the inside to be a whistle blower.

After Assistant City Manager Gary Barberio explained the City Council's options for action that night, Mayor Hall asked the speakers lined up for public comment to, "Be specific, towards the dates for the election." Ignoring Hall's attempt to silence discussion of rescinding the Council's August 25 vote, the first two speakers spoke against the approved plan. In response, the mayor called a halt to public comments until Barberio could "correct the errors" he claimed were made by the first two.

I don't know whether interruptions to allow for rebuttals of speaker opinions is unprecedented, but the general practice has been to allow all to have their say before inviting comments from council members and staff. Neither of the first two speakers were allowed to defend their arguments. To their credit, none of the others who followed obeyed the mayor's plea to ignore the elephant in the room.

After public comments, Hall asked Barberio and the city attorney to respond to the assertion the developer could make changes to his plan without city approval. The two explained the city planner would have to approve proposed changes to assure they were in keeping with the plan approved by the council. Mayor Hall chimed in, "So what you see is what you are going to get."

That's a promise the mayor can't keep, and here's why. Modifications to the plan are allowed, according to the city's website.

"Some actions that typically require Planning Commission or City Council approval would be acted upon at the “administrative” level, meaning the city’s professional staff would evaluate applications against the standards in the specific plan and make a determination about compliance. The decisions reached by the city’s professional staff could not be appealed to the Planning Commission or City Council." 

The plan itself is more specific.

"The City Planner's sign-off, or refusal to sign-off shall be final, however, the Specific Plan applicant or designee and City Manager shall meet and confer over any such refusal to sign off. There shall be no administrative appeal of the City Planner's sign-off or refusal to sign-off." (6.13.2.2)

If the city planner's decision is final, why would the developer and City Manager have to confer over a refused sign-off, unless it’s an offer the city planner can't refuse?

Don Neu is Carlsbad's City Planner, a very hard man to find on the city's website. He reports to the Director of Community and Economic development, who reports to the Asst. City Manager for Operations, who reports to the City Manager, who reports to the City Council. So the one person responsible for approving changes to the developer's plan for a lagoon shopping mall is three levels removed from those we've elected to act in our best interests. The potential for corruption is breathtaking.

To add credibility to the city's analysis of the developer's plan, Councilmember Packard asked Council staff at the November 17 meeting, "Can you tell me how many man hours were put into analyzing the project for the 9212 Report?" Does he really believe time spent on something reveals quality? No matter how long it took to produce, or the gender of those working on it, the report's rosy findings disclose a report carefully crafted to promote the developer's project.

No, Mayor Hall, what we see is not what we'll get. All we've seen so far are pretty pictures and a promise by a billionaire developer who's already lied to us once. 

More next time about the 9212 Report and the battle of the consultants over the promised economic/financial benefits to the city.