Port District Funds Stay Out of S.D.’s Reach : Budget: Request by San Diego to use port money to help reduce an $18-million deficit is put aside.

San Diego’s plan to use Port District cash reserves to ease its budget woes was squelched Wednesday during a meeting of the mayors of the district’s five cities.

The decision to put aside the plan to transfer port funds to San Diego, National City, Chula Vista, Imperial Beach and Coronado under recently approved state legislation drew debate between San Diego Mayor Maureen O’Connor and her counterparts.

O’Connor and city officials have expressed interest in using a majority of the port’s reserve to help cut San Diego’s $18 million deficit.

San Diego City Manager Jack McGrory earlier proposed that the five cities come to an agreement on distributing money held by the Port District in a $13.5-million tidelands trust fund. Recently passed legislation has made the cash reserve available, but an agreement on how to divide the monies is required between the five port member cities and the board of port commissioners.

On Wednesday, the mayors of the four South Bay cities sided with a report issued by the Port District on Tuesday disputing the availability of the tidelands funds.

The report, prepared by an attorney hired by the district, also opined that if tideland funds were available under the new legislation, they should not be used to supplement the operating budgets of port member cities, as San Diego has proposed.

San Diego city offices stand to lose 231 jobs beginning Oct. 20 if no agreement can be reached on supplemental funding from the Port District, said Paul Downey, press secretary for O’Connor.

“San Diego’s in a pickle,” National City Mayor George H. Waters said. “But what are you going to do each time you go into the hole? What’s to say next year one of the cities won’t come back and do the same thing?”

Waters said the port fund was originally set up to fund development.

At the meeting Wednesday, which was also attended by the five city managers and by County Supervisor Brian Bilbray, whose district encompasses the South Bay cities, the group agreed to look into two alternatives to raising revenue from the Port District.

The group proposes that the Port District enact a bond issue to fund future projects in the port area. The amount of the proposed bond was not decided.

The second proposal is to renegotiate operational agreements the cities have on port properties. New contracts can free up city money now spent on maintaining and policing various port properties.

The cities would seek to shift financial responsibility from the municipalities back to the district, Downey said. For example, the city could relieve itself of the financial responsibility of securing and maintaining the port-owned San Diego Convention Center, he said.

The mayors’ group is expected to meet again in one week with a list of project proposals to support the call for a bond issue. They will also provide a list of areas where contract renegotiation may be possible.

Mayor O’Connor requested that officials from each member city present the proposals to their respective city councils as soon as possible.

She asked that the cities expedite all decisions on the proposal, in order to meet the Oct. 20 deadline, when San Diego is expected to begin issuing job termination notices.