The board of the Civic San Diego subsidiary in charge of distributing millions of dollars in federal tax credits supports adding city representation to its advisory panel.
Civic San Diego’s Economic Growth and Neighborhood Investment Fund board voted last week to recommend an employee of the city’s economic development department be added as a voting member of its seven-member advisory board.
The board also recommended placing the city’s independent budget analyst or designee as a nonvoting member of the advisory panel, though two members criticized that proposal.
The board’s action came after a City Council committee voted in March in favor of adding a member of city management to the advisory board in hopes of increasing city oversight of the allocation of new markets tax credits.
Research by committee staff demonstrated that it is a best practice nationally for municipally sponsored community development entities, such as Civic San Diego’s fund, to have municipal oversight.
An official for the Civic San Diego growth fund said the board’s recommendations will go forward to the city, which is exploring the makeup of the advisory board.
The Civic San Diego fund’s advisory panel recommends projects to the full board that would benefit from a tax-credit allocation.
If the advisory panel rejects a proposed project, it does not go forward to the board, which is composed of Civic San Diego’s nine board members.
The fund’s board members expressed nothing but support for placing a member of the city’s economic development department on the advisory panel.
“To me, that seems like almost a no-brainer,” said Donna Jones, a Civic San Diego board member.
But board members Murtaza Baxamusa and Michael Jenkins voted against the recommendations, suggesting the IBA or designee should be on the Civic San Diego fund’s primary board.
Baxamusa asked at the meeting last Wednesday whether the transaction documents for a tax-credits allocation are reviewed by the advisory panel before members make a recommendation.
Michael Lengyel, a senior project manager at Civic San Diego, said the advisory members do not see those documents, and vote on projects at an earlier stage.
“What’s the point of having an IBA on an advisory board that cannot really exercise oversight when the documents are really coming to this board?” said Baxamusa, who recently sued Civic San Diego to determine whether the scope and oversight of the agency passes legal muster.
Jenkins said he also thought the IBA should be on the full board to flag concerns the city may have about proposed projects and transactions.
“The broader question is whether the city is at risk with any of these transactions and ... I think that is an issue the City Council was concerned about, or at least a couple of the City Council members,” Jenkins said.
After Jenkins’ comments, the board voted 4-2 in favor of the recommendations to increase the size of the board. Those voting in favor were Vice Chairman Rich Geisler, Jones, Cynthia Morgan-Reed and Carlos Vasquez.
Civic’s Economic Growth and Neighborhood Investment Fund has received $58 million in tax credits to disburse since it was created in 2012.
The new markets tax credits can be used to fund a mix of for-profit and nonprofit uses — such as community centers and medical facilities — in low-income communities.
The fund hopes to allocate the remaining $18.5 million in the coming months, and its board voted last week to advance the process to allocate more than $15 million to two projects.
Civic also applied for $76 million in tax credits in the latest round and anticipates award announcements will be made by the middle of June.
The board also voted to reappoint six members of the advisory board whose terms had expired or will expire this year.
The members receiving new three-year terms were: Jody Carey, Peter Callstrom, Daniel “Cruz” Gonzalez, Richard Lawrence, Diane Moss and Joel Roberts.
The other member of the board is Jason Wells, whose term will expire in 2017.
At least 20 percent of the members of the advisory panel, which is required by the federal government, must have a low-income association with targeted communities.
All members of the Civic San Diego fund's advisory board meet the criteria, which boosts its applications for tax credits to distribute.