Daily Business Report-March 28, 2014
The San Onofre Nuclear Generating Station
San Onofre Proposed Settlement May Save
SDG&E and Edison Ratepayers $1.4 Billion
A proposed settlement reached Thursday would relieve customers of Southern California Edison and San Diego Gas & Electric of paying $1.4 billion in utility charges related to steam generators that caused the 2012 shutdown of the San Onofre Nuclear Generation Station, City News Service reports.
The settlement agreed upon by the Utility Reform Network, state Office of Ratepayer Advocates and the two utility companies still needs approval from the state Public Utilities Commission.
According to TURN and the state ORA, the deal would retroactively prevent the utilities’ customers from having to pay for the steam generators from the time of the shutdown in late January 2012. The financial burden would be shifted to the utilities’ shareholders.
For Rosemead-based SCE, that works out to $1.12 billion, according to the ORA. For San Diego Gas & Electric, the total is $286 million.
SDG&E owned 20 percent of the plant on the northern San Diego County shoreline, and received one-fifth of the power it generated.
“This settlement agreement is an extremely good deal for customers who will see a refund of hundreds of millions of dollars in the coming years,” said Joe Como, ORA’s acting director.
The ORA also announced that the utilities’ customers could share in additional savings, depending on if Edison is successful in litigation against Mitsubishi Heavy Industries, the Japanese firm that manufactured the steam generators.
According to TURN, SCE and SDG&E would also refund any money collected from ratepayers since the beginning of last year in excess of the actual operational costs of the plant, and would refund to customers any money resulting from the sale of extra materials and supplies along with unused nuclear fuel.
Mayor Faulconer to Help Lead National Pro-Gay Marriage Group
A group of about 400 mayors who support same-sex marriages announced Thursday that San Diego Mayor Kevin Faulconer has been named one of its seven directors. Faulconer is following in the footsteps of former San Diego Mayor Jerry Sanders, who helped start Mayors For The Freedom to Marry.
“My strong support for marriage is rooted in talking to gay and lesbian people and hearing their personal stories,” Faulconer said. “I can’t look at my gay and lesbian constituents and tell them that their life commitment to the person they love isn’t worth the same respect, dignity, and protections that straight people have.”
He said that as a Republican, he values freedom, family and individual liberty, and that allowing gay people to marry fits those conservative ideals.
Freedom to Marry founder and president Evan Wolfson said more members of the GOP are invoking the values of freedom and family. “Mayors have a crucial role in advancing the well-being of the families, businesses, and communities that they serve, including gay and lesbian Americans who want to take care of their family and make a lifelong commitment to the person they love,” Wolfson said.
Other mayors who are directors of the group are Eric Garcetti of Los Angeles, Julian Castro of San Antonio, Michael Nutter of Philadelphia, Kasim Reed of Atlanta, Greg Stanton of Phoenix and Annise Parker of Houston. — City News Service
Changes Will Allow More Small Businesses to Get SBA Loans
More small businesses will soon be able to qualify for SBA loans to buy commercial/industrial buildings, according to CDC Small Business Finance. On April 21, the Small Business Administration will eliminate provisions that prevented small business owners with a high-net worth to purchase commercial real estate with a SBA-504 loan. The 504 loan can also help business owners buy and install heavy machinery and equipment.
“These new changes will allow more small business entrepreneurs to take advantage of SBA-504 financing to buy or construct their facilities,” said Kurt Chilcott, president and CEO of CDC Small Business Finance, the largest SBA-504 lender in the U.S. “Helping more small businesses grow will help create more jobs and, as a result, improve the economy.”
SBA-504 loans appeal to small business owners who are tired of paying rent and want to build equity for themselves. SBA-504 loans allow entrepreneurs to access low-fixed-rate, 20-year financing of over $20 million with a minimal down-payment (10 percent). Rates have been averaging 5.4 percent over the last nine months.
San Diego-based MachineTek, a manufacturer of aerospace/defense industry components, is poised to take advantage of SBA’s new rule changes. CDC Small Business Finance has structured a $2.4 million SBA-504 loan to help MachineTek’s owner buy a 21,000-square-foot building. He will save $2,000 a month by owning rather than leasing.
MachineTek has become an innovator in the field of precision honeycomb fabrication.
San Diego Tourism Officials Hope For A Better 2014
San Diego had nearly 38 million visitors last year, that’s up nearly 4 percent from the year before.
In fact, The San Diego Tourism Authority says nearly all of the indicators they track gained ground in 2013.
Authority president Joe Terzi says there were more overnight visitors, more border crossers, more people going to local attractions.
The direct economic impact was $8 billion. Even so, he sees 2013 as an underperforming year.
“We lost ground last year,” Terzi said. “San Diego has a small increase, about a 1 percent increase in occupancy in hotels in San Diego.”
Terzi says the local region did not perform as well as rivals.
Anaheim’s room occupancy rate jumped 2.5 percent. San Francisco’s rate grew by 3.3 percent.
The San Diego Tourism Authority is launching a $12 million ad campaign to capture some of that growth. State economic development official Kish Rajan says the competition is good for California.
“The impact of the hospitality industry to California’s economy is over $100 billion annually and so we in the state government want to encourage that. We want to help it,” Rajan said.
Rajan and Terzi both pointed to China as a key tourism target.
In San Diego, China’s growing middle class could bring even more money into a sector that already employs 165,000 people.
— KPBS Report
Consultant to Study Selling Naming Rights to Venues in Convention Center
San Diego Convention Center officials said they are in the process of hiring a consultant to determine the potential value of selling naming rights to venues within the facility. The center is hunting for additional revenue to pay for necessary capital projects and maintenance, as well as restoring depleted financial reserves.
The goal is to have naming rights in areas like the Sail Pavilion, but not the overall facility itself, Carol Wallace, president and CEO of the San Diego Convention Center Corp., told members of the City Council’s Infrastructure Committee. “The best brand is San Diego,” Wallace said. “We in San Diego have an idea of who we are, where we are. That’s the first thing — we have a lot of value in our own brand.”
She said a convention center in a Midwestern city was named for an airline that subsequently changed its name, so the center had to adjust accordingly. The airline was gobbled up in a series of mergers, forcing the facility to go through a few more name changes, she said.
“We would prefer to look at naming internal venues and not changing the name of the overall building. But I would say for the right price, we might be convinced different,” Wallace said with a chuckle.
Center officials also provided the committee with a prioritized list of infrastructure needs. At the top is a proposal to replace the fabric of the facility’s iconic sails in three to four years.
LISC Loan Supports San Diego Square Preservation
LISC San Diego (the Local Initiatives Support Corporation) has provided a $7.9 million loan to support Housing Development Partners’ preservation of San Diego Square, a 156-unit high-rise apartment complex for seniors at Ninth Avenue and Broadway in Downtown San Diego. The loan is part of a redevelopment package with the Corporation for Supportive Housing.
As a result of this acquisition, the property will remain affordable for another 55 years, and features rent affordable to residents earning a blend of 50 percent and 60 percent or less of the area median income. The complex, built 34 years ago, will be undergoing major rehabilitation work.
San Diego Christian College Opens New Campus
SANTEE — San Diego Christian College has opened its doors to students at its new campus at 200 Riverview Parkway in Santee. The campus includes five buildings totaling 56,000 square feet. Developer and design builder Ryan Companies US Inc. originally developed and built the campus, then sold five of the six buildings to the college in 2012.
Ryan Companies completed a tenant improvement build out that consisted of new facilities including a chapel/theater, classrooms, science lab, library, executive offices, administration offices, facility offices, student center, dining hall and a full cook-to-order kitchen.
San Diego-based Pacific Cornerstone Architects provided design for the project and Matt Reid of Land & Design Inc. was the construction manager.
With the completion of the tenant improvements, the college is expected to start construction on a multi-phase build out which will ultimately include market style apartments, athletic buildings and athletic fields.
Scripps Florida Scientist Awarded $2.3 Million
To Study Dengue Fever and Related Viruses
The outbreak of dengue fever that infected some 20 people in Florida’s Martin County late last year unnerved many who feared the tropical disease had once again established a foothold in Florida. The last outbreaks occurred in 2009 and 2010 in Key West — before that, the disease hadn’t struck Florida in more than 70 years. Now, scientists from the Florida campus of The Scripps Research Institute (TSRI) have been awarded $2.3 million to study a category of viruses that cause dengue fever, West Nile, yellow fever and other diseases spread by mosquitoes and ticks. These diseases can result in flulike symptoms, extreme pain (dengue has been called “bone-break fever”) and, in some cases, encephalitis.
This family of viruses, called “flavivirus,” affect some 2.5 billion people worldwide and cause hundreds of thousands of deaths each year. There are no antiviral treatments and a just handful of vaccines that provide protection against only a few of these diseases.
The principal investigator for the new five-year study is TSRI Associate Professor Hyeryun Choe, who will lead the effort to understand the virus’s mode of infection and how new therapies might interrupt it.
“Flavivirus uses a very clever method of infection,” Choe said. “It’s like using a side door to enter a house when the front door is locked.”