San Diego City Manager Resigns Amid Inquiry

City Manager Michael Uberuaga resigned Tuesday amid a federal investigation into the city’s financial practices.

Uberuaga has managed the daily operations of California’s second-biggest city for 6 1/2 years, overseeing more than 10,000 municipal workers and a $2.3-billion budget.

In his letter, Uberuaga said he intended to retire April 9 but did not say why. He did not immediately return a message seeking comment.

The Securities and Exchange Commission and the U.S. attorney’s office have opened preliminary investigations into whether city officials provided fraudulent information to investors to sell more than $2.3 billion in bonds. They also are looking into the city’s $1.1-billion pension fund deficit.

City officials have disclosed that San Diego has intentionally underfunded its pension system since 1996 in an effort to bridge budget shortfalls. Wall Street credit rating firms downgraded the city’s once stellar financial outlook as a result.

Mayor Dick Murphy, who is running for a second term in the November election, praised Uberuaga as a “dedicated, hardworking employee.”

“Mike always put the best interests of the citizens of San Diego first,” Murphy said in a statement. “He has devoted himself to his work, and his integrity is unparalleled.”

Ron Roberts, a county supervisor seeking to unseat Murphy, has said he would fire Uberuaga, a move that Murphy said he opposed. Roberts said Uberuaga failed to steer the “good ship San Diego” away from a “financial iceberg.”

“At the very least, he was acquiescing in what were some very bad decisions,” Roberts said.

The mayor said he will ask the City Council to promote Assistant City Manager Lamont Ewell to Uberuaga’s job. Roberts said the city should conduct a nationwide search.

Before San Diego, Uberuaga spent more than two decades as manager of the California cities of Milpitas, Concord and Huntington Beach and of Steamboat Springs, Colo.