Coastal access money taken to clear debtPromote La Jolla’s woes continue as First Republic Bank last week took money from an account the group was holding in trust for the Coastal Access and Parking Board to pay off an overdue debt.
That move sparked a 26-page correspondence from PLJ President Rick Wildman to the bank and a gathering of the parking board, which hasn’t met for two years.
The Village merchants’ group learned earlier this year it owed more than $61,000 on a line of credit that was due April 1. PLJ was the borrower and what was formerly the Promote La Jolla Foundation, the guarantor.
PLJ’s board met in mid-April with the bank’s representative, Jason Shidler, in an effort to work out an extension, but on May 29 Wildman received a letter stating the bank had taken proceeds from a certificate of deposit - being held in trust for the parking board - to cover the debt.
On Monday afternoon, the five members of the nine-person parking board present to reactivate the group voted to send a letter to First Republic asking that the money be returned to the PLJ account. They also agreed to send a second letter to PLJ asking for an accounting of the parking board’s funds and documentation establishing the business improvement district’s role as fiduciary agent for the board.
Calls to the bank’s San Francisco office had not been returned by press time. Shidler was on vacation and referred calls to Tim Fischer in the bank’s Carmel Valley office.
“I am not at liberty to talk about it at this point,” Fischer said Tuesday, adding that there was no one else who could address questions.
‘Recipe for problem’Joe LaCava, the parking board member who called the meeting and will serve as interim chairman, said he had been watching what was happening with the business improvement district.
A couple of months ago, he said he saw “the pending nexus of the unfortunate situation (with PLJ) and the Coastal Access funds. I saw it as a recipe for a possible problem.”
Before the board could intervene, he added, “bad things happened.”
While there was a difference of opinion among board members about who was responsible for what they agreed was the bank’s “seizure” of city money, there was no debate about the need to get the money back.
Noting that the PLJ board “messed up,” board member Ray Weiss said with the right tone in a letter to the bank, “we can help you (PLJ) get it back.”
“It’s hard to blame the bank for what they did,” he said. “From their point of view PLJ owed them the money.”’
Origins of boardThe parking board - consisting of three members each from PLJ, the community planning association and the town council - was formed under a coastal plan to administer development impact fees that were paid to the California Coastal Commission to mitigate the traffic and parking impacts these developments would have on the village of La Jolla.
The plan called for 50 percent of the funds to be used for a remote parking reservoir and shuttle service and the other 50 percent of the funds for short- and long-term parking and traffic circulation and other related programs such as signage, educational and promotional programs, said Deborah Marengo, former PLJ president.
When it was determined a shuttle system was not cost effective, the board set up a system to sell discount bus passes and buy parking spots in Village parking garages for local business employees,
The Coastal Commission shifted funds to the city of San Diego to be held until a solution that fit its guidelines was found. That has yet to happen, and the account now holds more than $361,000. A separate account was put under PLJ’s watch, to enable the parking board to run the bus pass and parking program.
In May, the Coastal Access parking money was in a certificate of deposit valued at $69,322.45. After “applying $65,323.14 in proceeds as full repayment,” the bank returned $3,999.01 to PLJ.
(PLJ holds two additional accounts for the parking board: A checking account with about $17,000 and a savings account with about $9,000, Treasurer Daisy Fitzgerald confirmed at Monday’s meeting.)
When asked, Wildman said it was possible that all accounts had the same tax ID number, acknowledging that could have led to the bank thinking the parking money was PLJ’s.
In his response to the bank, sent on June 5, Wildman returned the check and demanded that the money from the parking board be returned.
The letter recapped the interaction between the bank and PLJ and noted “certain inaccuracies in the assumptions” which he called “egregious.” He cited such points as a lack of a PLJ resolution approving the loan and an incomplete “corporate resolution to borrow.”
He said after Monday’s meeting that conversations continue with the bank and he is hopeful something can be worked out without the matter ending up in court.