Escondido Civic Center Issue Sizzles as Vote Nears

The city’s municipal art gallery is in a converted library building that also houses the Parks and Recreation Department.

The community playhouse is on the second floor of a small shopping center; patrons sit in folding chairs.

When the Escondido Chamber of Commerce holds its annual banquet, there’s no place in town big enough for everyone, so it is held outside the city.

Against that backdrop, voters here on June 4 will be asked to approve the construction of a $52-million civic center and cultural arts complex.

The plans call for a 2,500-seat auditorium where symphonic, operatic, musical and Broadway-like productions can be staged; a 500-seat theater for lectures and locally produced stage shows; a 25,000-square-foot fine arts museum for traveling art exhibits and displays of local art and historic memorabilia; a 25,000-square-foot banquet and meeting room for public and private conventions, receptions and banquets for as many as 800 people; a new City Hall, and extra office buildings for county and state governments.

The entire project will be financed as part of the city’s downtown redevelopment project, which uses a financing mechanism that allows the city to capture as much as $250 million by redirecting the flow of property tax revenue.

This massive undertaking, its supporters say, will not only transform Escondido into the cultural jewel of North County--if not all of San Diego County--but also revitalize the stagnant downtown, enrich the city treasury and pay for all the public schools this town will ever need.

And, the proponents note, it won’t cost the taxpayers a single dime in extra taxes or fees.

Sound too good to be true?

Yes, say the critics of the plan. There’s no such thing as a free lunch, much less rainbows with golden pots, they say. Although the taxpayers won’t have to dip into their own pockets to pay for the undertaking, the project eventually will starve the municipal treasury of money that’s needed to pay for such basic city responsibilities as police, parks and road improvements, the critics contend. Besides, they ask, does Escondido, a city of 77,000, really need an elaborate cultural arts center?

Harry Sternberg, a nationally recognized painter of modernistic portraiture who lives in Escondido, has had paintings shown in art museums around the world, including New York’s Metropolitan Museum of Art. But his showing at Escondido’s own Mathes Community Culture Center received a dismal turnout, he said.

“I’d be the last guy opposed to such a thing (as the cultural arts center). Naturally, I want to see a nice gallery in Escondido,” he said. “But we already have a hell of a nice one. There’s only one minor problem--nobody comes.

“I’m afraid Escondido is trying to fool itself into believing it is more cultural than it is. This is a silly dream. It’s idiotic.”

Since most people have little firm understanding of the redevelopment process, whether the city ends up building the civic center complex will depend largely and simply on whether the voters want to support the cultural arts and believe that the center can be built without financial risk to the city.

There is no doubt the stakes are incredibly high for Escondido. Hundreds of millions of dollars would be generated over the next 45 years or so by the project, city officials say.

The center will give the city its first real piece of distinctive civic identity, proponents say; it holds the potential for changing the complexion of the tired downtown area into one thriving with new specialty stores, offices and fine restaurants.

Four of the five members of the City Council favor the project. Jerry Harmon remains undecided. Privately financed opinion polls indicate that the center will be approved in the election.

But a small handful of vocal opponents, led by Ron Bittner, a former mayor and one-time gun shop owner, is attacking the center and its financing plan as far-fetched, unworkable and too risky.

City officials are irked by Bittner’s opposition because he has commanded a good deal of anti-civic center publicity in the local newspapers. In fact, the citizens group campaigning for passage of the civic center measure, Proposition A on the ballot, has announced it will no longer publicly debate him because that only serves to give the sharp-tongued Bittner more newspaper coverage.

General manager of a microscope manufacturing company in town, Bittner sits in an office dominated by a 48-star American flag and a tapestry of an eagle, the Liberty Bell and the Stars and Stripes.

He preaches the free marketplace and abhors government involvement in it. He is opposed to the redevelopment of downtown Escondido for the simple reason that it involves City Hall.

He says he likes to “take on government” for fun. “Somebody has to be cynical and skeptical about government. Otherwise, government walks all over you,” he said with a smile.

“If anything I have done costs them (civic center proponents) the election, it’s because more than half the voters will have agreed with me,” Bittner said. “I won’t apologize for that.”

Bittner has complained that the ballot language is deceitful because it does not mention the use of redevelopment as the financing mechanism for the project.

Proposition A asks, simply:

“Shall the city be permitted to finance and construct the estimated $52 million civic/cultural center without increasing taxes, fees or assessments?” It then describes, in one sentence, the components of the center.

The city already has designated downtown for redevelopment to counteract visual and economic blight brought on in part by the construction of the massive North County Fair shopping center on the south end of the city.

The city’s redevelopment agency will pick up the tab for public improvements in the redevelopment area, including extensive landscaping, pedestrian amenities, street widening and new parking lots. Also, as required by state law, 20% of the redevelopment budget is earmarked for housing. In Escondido’s case, money will be set aside to help mobile home owners buy their own mobile home parks.

The redevelopment plan also calls for construction of the civic center and cultural arts complex within Grape Day Park, the city’s large downtown park in the area bounded by Valley Parkway, Escondido Boulevard, Woodward Avenue and Broadway. Some privately owned parcels already have been purchased by the city, and some baseball diamonds will be displaced to make room for the facilities, but the bulk of Grape Day Park, including its swimming pools and Heritage Walk, will remain intact.

The city already has set aside more than $6 million for the construction of a new $8-million City Hall, which will be built at the site whether the adjoining cultural arts complex is approved by voters or not.

And, city officials say, the other downtown redevelopment projects also will be built even if voters torpedo the cultural arts complex.

“But without the cultural center, we’ll have a pretty downtown that is dead,” said Rod Wood, assistant city manager. “We need the cultural arts center to bring the people downtown, so it will thrive.”

Redevelopment money to pay for all of this is raised through tax-increment financing, in which the area’s property tax base is frozen when the redevelopment project begins. Thereafter, as the area’s assessed valuation increases above the frozen level, that increased is tapped exclusively by the redevelopment agency. As much as $250 million in additional property tax revenue would be directed to the redevelopment agency rather than the other public agencies--the county, school districts, the city, etc.--that normally would receive the money.

The city treasury, for instance, would not receive about $35 million in tax revenue over 45 years that it would have received were there no redevelopment project.

Sometimes, other public agencies balk at redevelopment because it reduces their future tax revenue.

But the two school districts in Escondido have endorsed redevelopment--and will send a mailer to voters explaining how it works--because the city has promised to build as many as 15 new elementary schools, three new junior high schools and three new high schools over the next 45 years. Since state money for new schools is virtually nonexistent, local districts have been forced to assess local development fees against new neighborhoods to build schools. Furthermore, state law allows the school districts to be reimbursed by the state for every dollar that the redevelopment agency siphons away from them. The schools are in a no-lose situation.

The County of San Diego agreed to give up as much as half of its tax-increment income to the redevelopment agency because, in exchange, the city promised to give the county 60,000 square feet of new office space in the civic center complex, or $6 million in cash, or the use of the existing police station as a county building (if the city decides it would rather build a new police station for itself).

Of the $250 million expected to be generated by the redevelopment agency, $52 million is earmarked for construction (including interest payments) of the civic center/cultural arts complex. The agency would sell tax-free bonds to generate the working capital, and repay the bondholders with the revenue generated by the tax-increment revenue. If, for some unforeseen and unlikely reason, property values within the redevelopment area did not appreciate, the bondholders--not the city--would be left holding worthless paper.

Bittner’s complaint is that the redevelopment agency will receive $35 million in yet-untapped property tax revenue that otherwise would go to the city. He contends that the money would be better spent on police, parks and street improvements.

But consultants to the city say that, based on redevelopment projects in other cities, the property values within the Escondido redevelopment area will increase so much--triggered by the city-financed construction--that over 45 years nearly $800 million in additional property tax revenue will be generated.

The city’s share of that will come to about $111 million over 45 years, or nearly $2.5 million a year on the average, city officials say. Furthermore, the downtown improvements will spark greater retail sales activity, generating about $140,000 a year in additional sales tax revenue to the city, according to the consultants’ projections.

Overall, then, while redevelopment will cost the city about $800,000 a year in lost tax increments, it will generate about $2.6 million a year in new, gross revenue to the city--at least, according to the consultants’ studies. The net result, city officials say: Redevelopment will not drain the city’s treasury, but rather fatten it by a net $1.8 million a year.

Bittner scoffs at those figures.

“They make these generalizations that the cultural center will increase property values. That is a gross generalization that is not supported by any facts whatsoever,” he said.

Bittner also targets the operating cost of the cultural arts center. By city estimates, income generated by the cultural complex, such as ticket sales and room rental fees, will come up $290,000 a year short of expenses. Bittner contends the city can ill afford to make up the loss.

It’s not a problem, city officials and backers of Proposition A say.

Since the $52-million budget already includes a new City Hall, the $6 million--and growing--fund already established to build it can instead be put in a trust account to earn interest. At 10%, there would be more than enough interest income to pay the operating deficit of the cultural center, officials maintain.

Bittner worries that some future City Council may raid that account for other purposes.

Officials point out that the redevelopment agency is required by law to lease from the city the land on which the civic and cultural arts center will be built. Those lease payments to the city are estimated at $900,000 a year--again, far exceeding the anticipated operating cost of the complex.

With the City Hall trust fund interest income and the lease payments combined, the city will generate $1.5 million to $2 million a year in new income, even after the operating deficit is covered, officials say.

But to cover all bets, Proposition A supporters have kicked off a fund-raising drive to solicit corporate and individual donations to cover the operating deficit of the cultural arts facility.

John Dailey, a prominent Escondido businessman, is chairman of the Escondido Cultural Center Foundation, established by the City Council to raise private funds for the center.

“Is the money out there to cover the operating costs? You bet it is,” he said confidently. “Banks, real estate companies, large construction companies--they all take profits from this community, and this is their chance to be good corporate citizens in return. This is a wonderful scheme. I can’t see any major company not wanting to participate in this, because it will get wonderful advertising and public relations in return.”

Financial questions aside, Bittner wondered if Escondido belongs in the culture business in the first place.

“If (Broadway) road shows were so popular and profitable, don’t you think there would be someone in the private sector building a theater?” he asked.

“In all of North County, there are less than 100 members of the San Diego Opera Guild. There are, I think, only two members living in Escondido--and one of them is on our committee,” he said.

And a fine arts museum? “We are not a community oriented to that type of culture,” he said. “We’re more oriented to country-western dance and outdoor barbecues. That’s more typical of North County. We’re not white-tie-and-tail people.”

Ann Lievers, president of the locally based Felicita Foundation for the Arts, strongly disagrees with Bittner and with her friend, Sternberg, the painter.

In the past year, she said, eight shows were staged at the Mathes Center, drawing about 12,000 people.

“When you put up a 25,000-square-foot art gallery, you’ll attract attention--even if you put dog biscuits in it,” she said. “The gallery itself will attract attention.

“It’s a gutsy plan, but it’s possible, and it will make Escondido fantastic.”

Bittner’s counterpart in the Proposition A battle is Alan Skuba, who, like Bittner, is a former mayor. Skuba heads Citizens for a Better Escondido, which is campaigning on behalf of the proposition since City Hall officials are supposed to remain neutral.

“To me, arguing for the cultural arts center is like stating the merits of motherhood,” Skuba said. “We have the opportunity to embrace those things which every better community already has. . . . Every community, going back to the Indians, had their central areas.

“If people are narrow-minded and this isn’t approved, then fine, we don’t deserve it. But I can’t conceive of an issue that’s ever been as vital to the community as this one. We’re approaching our 100th birthday (in 1991) and this is our opportunity to step forth and make a statement about Escondido.”