Judge refuses to halt sale of two dozen state government buildings

A San Francisco judge refused Friday to halt the controversial sale of two dozen government buildings, clearing the way for what the Schwarzenegger administration describes as a much-needed infusion of revenue to shore up the ailing state budget.

Superior Court Judge Charlotte Woolard ruled that the two men who opposed the sell-off — which they described as a waste of taxpayer money — have no standing to sue the state to stop the transaction.

Outside Woolard’s courtroom, a spokesman for the Department of General Services, which is conducting the $2.3-billion sale, said the state is “very satisfied with the judge’s ruling” and would work to close escrow as planned on Wednesday.

“The judge’s ruling … confirms the direction we received in 2009 from the Legislature and the governor to proceed with this sale in order to generate revenue that’s desperately needed for the state of California,” said Eric Lamoureux, a spokesman for the Department of General Services.

But Joseph Cotchett, attorney for the two men who sued to block the sale, vowed to appeal. He derided the transaction as “an unconstitutional stealing of taxpayers’ money.”

“We believe the sale should be stopped,” Cotchett said. “The case is going to go on. It’s going to take months to go on. Someone is going to pay some damages here for this conduct.”

Cotchett represents two former building authority commissioners whom Gov. Arnold Schwarzenegger ousted when they raised questions about the sale. Among the buildings on the block are the San Francisco Civic Center Complex, home of the California Supreme Court, and the Ronald Reagan State Building in downtown Los Angeles. Those buildings are also home to appellate courts.

Under the terms of the transaction, the state would lease back the buildings from their new owners, a consortium of investors called California First LLC. In a recent report, the nonpartisan Legislative Analyst’s Office said that over the next 35 years, selling the buildings would cost the state $1.4 billion more than keeping them.

On Wednesday, the Judicial Council of California filed court documents alleging that it is the “de facto owner” of both the Reagan building and the San Francisco complex and that the state cannot sell them without the council’s consent.

In addition, Cotchett had argued that the sale violates the separation of powers doctrine, which holds that the three main branches of government must function independently of one another. In other words, the governor represents the executive branch; he cannot sell off courthouses, which belong to the judicial branch.

But in her ruling Friday, Woolard said the Judicial Council does not own the buildings and that the state does not need to gain the panel’s approval to proceed with the sale.

And, she continued, “selling the buildings does not implicate the separation of powers doctrine or affect a core function of the judicial branch.”

maria.laganga@latimes.com