Wednesday, August 11, 2010 | Irvine city leaders and former Orange County grand jury members are openly battling over the content of the grand jury’s recent report on the financing of the Great Park.

The report, released in June, blasted not only the financing terms of a $134 million loan agreement to fund the park, but also a potential conflict of interest and what the report says was a disingenuous promise not to levy new taxes to build the park.

Earlier this month, Great Park Board Chairman Larry Agran dismissed the report as reflecting a “profound ignorance about the funding agreement.”

This week, the city offered its official response — a point-by-point rebuttal of the report’s concerns and recommendations. City officials contend that the report shows basic misinterpretations, inaccuracies and even a possible “philosophical” disagreement with redevelopment.

Former grand jury members maintain that their report is a straightforward and accurate account of the troubles of the park’s financing arrangement.

Gerald Brown, who sat on the grand jury committee that looked at the park, said the city’s contention that grand jury members had fundamental misunderstandings is unlikely given that field experts, members of the grand jury, city officials, and even county counsel, scrutinized the report before it was released.

“The grand jury has a multi-step vetting process where things are checked and rechecked,” Brown said. “What we did was a process I was really comfortable with — where there were many eyes looking at it.”

Irvine’s response acknowledges that city and redevelopment agency officials looked at the report before it was released, and that many recommended corrections were made, but others weren’t, “resulting in the issuance of a report that is inaccurate and misleading.”

The biggest sticking point is the idea that the city’s financing of the park has essentially created new property taxes. Irvine contends that it is not implementing any new taxes but simply using tax increment financing for the Great Park like all redevelopment agencies do.

“If the Grand Jury philosophically disagrees with the concepts of redevelopment and tax increment financing,” the Irvine report read, “it should say so and present its objections to the State Legislature. It should not state or imply in the Grand Jury Report that tax increment constitutes ‘new taxes’ by using the misleading phrase ‘the redirecting of increased property taxes.’”

Grand jury members say they are “just stating the facts.” Brown points to the Great Park’s sharing of the communities facilities district tax — a “special property tax” — as a new tax.

“We weren’t taking sides over redevelopment law, we were just stating the facts,” Brown said.

Irvine’s response also rebuked the grand jury’s contention that having the redevelopment agency and Great Park boards made up of all five City Council members invited a potential conflicts of interest, saying that nearly all the redevelopment agencies in the state are made up of the cities’ council members.

Brown says that’s true, but it misses the point. He says most redevelopment agencies don’t deal with what the report says is a $1.6 billion park project. (Agran disputed that figure at last night’s council meeting, saying it was closer to $1.2 billion.)

“As the late Senator Everett Dirksen said, ‘Now you’re talking about real money,’” Brown said.

Mayor Sukhee Kang said at least some of the difference between the city and the grand jury comes down to a perception of the facts. He also said the grand jury’s philosophical stance doesn’t leave much room for argument.

“It’s more a philosophical discussion — which I don’t think there would be any compromise for that,” Kang said.

After airing many of their concerns about the report, the City Council last night voted, 4-1, to approve the official response. Councilwoman Christina Shea voted no and cited concerns over the “nasty” tone of the response.

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