City Accused of Favoring Former Rival Developer : Grand Jury Boss Denies Role in Plunge Report

The foreman of the San Diego County Grand Jury, a former developer who once expressed interest in bidding on a city lease for the Mission Beach Plunge, said Wednesday he had “absolutely zero” to do with a grand jury report that charges city officials with granting a sweetheart deal to a rival team of developers to build shops and restaurants around the historic swimming pool.

Ed Malone, now an avocado farmer, said he never became involved in deliberations or preparation of the grand jury report, which was issued Tuesday. The report accuses San Diego City Council officials of subverting the public’s interest by granting a “monopoly” bid to Belmont Park Associates for tearing down more than half of the Plunge building and building 106,000 square feet of commercial space on the city’s oceanfront property.

Withdrew From Proceedings

Malone said he withdrew from the proceedings after the county counsel’s office determined last July that he would have a conflict of interest. The conflict stemmed from the fact that he gave the Save Mission Beach Plunge Committee $2,000 last year to help with a ballot measure aimed at halting the Plunge project.

The ballot measure was approved overwhelmingly by San Diegans in November, 1987, but Belmont Park Associates was allowed to proceed with the project because it had completed a significant amount of construction by the time of the vote.

Before the vote, Malone appeared at many council meetings to speak against the proposed Plunge development. In 1984, he sent a letter to former Councilman Mike Gotch, expressing interest in bidding on the lease for the Plunge if it became available.

Past Conduct Criticized

It is that past involvement by Malone, say supporters of the current Plunge development, that “taints” the grand jury’s scathing report.

“As far as I’m concerned, he (Malone) has had a hand in it,” said Councilman Ed Struiksma, who was criticized in the grand jury report for voting for the project. “If you believe that (Malone had no involvement), I’d be happy to talk to you about a bridge in the bay I’d like to sell to you.

“My feeling is that it’s a total abuse of power so far as Malone is concerned.”

Graham MacHutchin, a member of Belmont Park Associates, said the grand jury report was biased because the panel never contacted anyone in the partnership to seek its side.

“It’s more than a coincidence that the grand jury foreman is a developer who wanted to parachute himself into the process and was unable to do so,” said MacHutchin.

The 49-page grand jury report blamed the city for failing to follow its guidelines on competitive bidding for municipal leases. The result, the panel wrote, was “unusually favorable treatment” for the developers, who had two years of exclusive negotiations. The deal, the report said, will cost taxpayers $14.5 million to $19 million in lost revenue over the 50-year lease.

The report also said that Struiksma and other members of the City Council must “share in the responsibility for not protecting the interests of the citizens of San Diego from ‘monopoly’ bidding” by voting in April 1984 to grant exclusive negotiating rights for the Plunge to MacHutchin’s development group.

The grand jury document also scores former Councilman Mike Gotch, whose beach district included the Plunge, for not telling his council colleagues before that vote that he had received the letter from Malone two months before expressing an interest in bidding on the Plunge.

The grand jury report was signed by Raymond Tieger, a South Mission Beach resident who serves as the foreman pro tem. Tieger said Wednesday that Malone “had no involvement” in preparing the report.

“He did not see the final report until it was issued yesterday, when it became part of the public record,” said Tieger, who lives less than a mile from the Plunge. “And he had absolutely no contact with this report or the jury in its deliberations.”