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Monday, December 27, 2010

Schwarzenegger Dealt Setback In Bid to Rush $1.3 Billion Building Sale

Posted By on Mon, Dec 27, 2010 at 5:30 PM

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Gov. Arnold Schwarzenegger's frantic bid to rush the $1.3 billion fire sale of 11 state buildings before he leaves office suffered a blow this afternoon. A state appeals court in San Jose announced it wouldn't hear arguments until Jan. 26 regarding whether the sale should be allowed. Schwarzenegger, of course, is out of office come Jan. 3.

This bodes poorly for the controversial deal, which would involve $6 billion in long-term taxpayer lease payments to investors who refuse to divulge their names. Earlier this month, state officials who'd been fired for challenging the sale, sued. A court halted the sale on Dec. 13. Depositions revealed  fishy aspects to the deal, including a potential $500,000 "finders' fee" to the mayor of Santa Ana. Attorneys have filed a flurry of motions of late in an effort to get the sale completed before Schwarzenegger leaves office. In litigating the sale, the state attorney general -- Edmund G. Brown Jr.; you've heard of him -- has not been representing the California Department of General Services, which is in charge of executing the sell-off.

Instead, the Department, as well as the governor himself, has been represented by private attorneys. Those privateers have struggled to convince judges at San Francisco Superior Court, the California State Supreme Court, and the California Court of Appeals Sixth District in San Jose, that the sale must go through NOW! Or something bad might happen. There are no procedural deadlines tied to this sale. But there will be a new governor -- the same Jerry Brown, who's not taken up Schwarzenegger's legal fight to rush the sale.

Former San Francisco State Building Commissioner Donald Casper, who was fired this March when he protested the sale, is an intervenor in the suit to halt the sale. He said the appeals court's announced schedule bodes well for his, and other fired commissioners', efforts to halt what they say is a disguised scheme to add needlessly to California's indebtedness.

"The Brown Administration would want to go more deeply into the details and players of this transaction, and all that has to come out. Is that what they want to prevent?" Casper said. "Brown's promised style of government requires much greater transparency than what we've been given on this deal."

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