Former San Diego Mayor Dick Murphy and his council colleagues had fuzzy memories when independent investigators asked them about what they knew and when they knew it as the city's financial problems mounted.
In response to dozens of questions, the politicians said they couldn't remember the specifics surrounding their decisions. However, they were able to answer more general questions about the workings of city government.
Summaries of those interviews were delivered yesterday to the City Clerk's Office by Kroll Inc., the New York-based firm that released a 266-page report last week documenting a pattern of wrongdoing dating to 1996 by nearly three dozen city officials.
The Kroll investigators had withheld the interviews, citing a work-product privilege they eventually waived.
City Attorney Michael Aguirre, who has been highly critical of Kroll and its report, has said the interviews are the only way to determine the thoroughness of the firm's work.
Throughout the interviews, Kroll investigators asked the politicians a variety of questions about Petco Park bonds, the city's Pension Reform Committee, labor negotiations, sewer rates and whistle-blower Diann Shipione, who first alerted city officials to the pension crisis. The pension system deficit is now at $1.43 billion.
There's little new information in the interviews. The politicians – including council members Toni Atkins, Donna Frye, Jim Madaffer, Brian Maienschein and Scott Peters – have long said they relied on the advice of professional staff who hid the reality of the city's pension problems from them.
The interviews provide a few interesting anecdotes:
Atkins' lawyer, Sean Prosser, asked if his client would be able to review a summary of the interview afterward. Atkins said Vinson & Elkins, the firm that investigated the city before Kroll, told her it would allow her to review her interview but never did.
Kroll's lawyer explained his firm was “taking a different approach” than Vinson & Elkins and would not allow it. KPMG, the city's outside auditor, questioned the thoroughness of Vinson & Elkins' work, which led the city to hire Kroll.
The Kroll report quotes Madaffer as saying, “Let 'em sue us,” when questioned about the legality of the city's sewer rates. In his interview, he said he couldn't recall having said that but acknowledged it sounded like something he would say.
Peters said his initial impression of Shipione was that she was attractive and intelligent. Asked why her warnings were dismissed, Peters said she was “apparently not a very likable person,” and that her personality “preceded the substance of her allegations.”
Murphy blamed his busy schedule when he said he didn't recall if he had seen a letter by a member of his Blue Ribbon Committee on City Finances about the positive “tone” and “spin” of the committee's report, which showed relatively healthy funding levels in the pension fund.
Asked about his and the council's understanding of the pension system, Murphy said, “I don't think anyone understood the pension system and how it was funded.”
Craig Gustafson: (619) 293-1884; craig.gustafson@uniontrib.com
