Sept. 15 2010 10:18 AM

How pressure from a cruise-ship company caused a ton of waterfront controversy

Map by Adam Vieyra
During a Sept. 7 public meeting, Steve Cushman, a member of the Port of San Diego's Board of Commissioners, made what was regarded by some as the most emphatic statement thus far in support of the notion that the Port promised to build a large public park between Harbor Drive and Broadway Pier.

“We put the oval park in [the Port Master Plan],” Cushman said. “Whether we like it or not, it's history. But we did do it. I don't care what anybody says—we printed it, we published it, we can show it to you.”

It was seen as pretty big news, and it buoyed a group of activists who've sued the Port over a large cruise-ship terminal nearing completion on Broadway Pier, a building that has been plopped smack in the way of the proposed park and potential year-round enjoyment of the pier itself. Port officials say a park isn't possible because large supply trucks need that land to get to the terminal. But the activists have dug in their heels and, through a successful appeal this past April to the state Coastal Commission, have stalled a larger campaign to spruce up the waterfront.

Three days before the Sept. 7 meeting, another port commissioner, Lee Burdick, attended a conference—dubbed “Art in the City” and organized by developer David Malmuth—that concluded with a discussion of the potential of San Diego's Downtown waterfront to become a vibrant place oriented around arts and culture.

CityBeat called Burdick on Friday for comment on how the conference had impacted her thinking about the future of the waterfront. She said that as the beautification campaign progresses, she plans to be an active advocate for Malmuth's vision. But, at the end of a 45-minute interview, CityBeat asked her if, in hindsight, there might have been a way to avoid the brouhaha surrounding the cruise-ship terminal and the park. Burdick, an attorney who was appointed to the Board of Commissioners 15 months ago and doesn't believe the park was promised, took the opportunity to lash out in the direction of Cushman, who's been on the board for 11 years and is widely considered to be a politically powerful figure.

“I'm going to be very candid with you,” Burdick said. “I was shocked at the end of Tuesday night's meeting, when Steve Cushman said, ‘The park was promised, it was in the plans, it was approved—live with it.' “My thought was,” she continued, speaking slowly and punctuating a words for effect, Well, sir, if that is true, how could you possibly have voted to approve a cruise-ship terminal on the Broadway Pier, the logistics of which would require the elimination of a park that was in the master plan, without a master-plan amendment?” In other words, how could Cushman have supported construction of a building that would necessarily kill a park he believes was guaranteed, in writing, to the public?

Cushman wouldn't answer CityBeat's questions directly, but through Port spokesperson Ron Powell, he said he didn't mean to suggest that the Port “promised” a park—only that the Port included a depiction of the park in the Port Master Plan, the agency's guiding land-use blueprint, by mistake.

All this hubbub over a proposed park is boiling over because of a building that isn't even necessary. That's right: There was never supposed to be a permanent cruiseship terminal on Broadway Pier. In fact, thanks to a downturn that was apparent in the cruise-ship industry years ago, it's possible that the brouhaha over the park could have been avoided altogether, and the larger waterfront project could be underway.

In late 2004, Carnival Corporation, the world's largest cruise-ship company and the Port of San Diego's biggest cruise operator, parenting both Carnival Cruise Lines and Holland America, told the Port that it couldn't continue its operations in San Diego unless the Port upgraded the facilities on B Street Pier, where cruise ships currently dock. Port officials told Carnival that it didn't have the money, so, in early 2005, Carnival agreed to loan the Port, at 4.5-percent interest, $8 million, in exchange for a preferential berth. The loan would be paid back through a special facility fee paid by cruise passengers.

While B Street Pier was being renovated, the Port would need to move the cruise-ship business to Broadway Pier, which would also serve as an overflow terminal, after B Street Pier was finished, at times when a third berth was needed. The plan was to erect a large, temporary tent on Broadway Pier.

But, the San Diego Fire Marshal told the Port that it wouldn't allow a tent larger than 21,000 square feet and made of flame-retardant fabric to be up for more than six months at a time, leaving the Port to decide between a tent made of non-combustible fabric and a prefabricated metal building, with the two options costing about the same amount of money. The U.S. office of Customs and Border Protection told the Port it preferred the metal building, so, on Dec. 19, 2006, Port officials decided to go with metal.

In early 2007, in exchange for a second preferential berth, Carnival agreed to increase its loan to $12 million and reallocate much of the original $8 million to pay for the metal building so that the Port could get Broadway Pier up and running before the start of renovations to B Street Pier.

Laurie Black joined the Port's Board of Commissioners midway through 2007. She said that it was during her first staff briefing that the Port's marketing director, Rita Vandergaw, showed her an image of a prefab metal building.

“I freaked,” Black tells CityBeat. But she wasn't the only one. According to a memo written by Christine Anderson, the Port's vice president for operations, and recently revealed by blogger Pat Flannery, after a July 26, 2007, public meeting, Bill Anderson, the city of San Diego's planning director, told an unidentified member of Port staff that Broadway Pier was no place for a metal building. “He implied that the building should be iconic at the foot of Broadway and that he believed the mayor would be objecting to our plans,” Christine Anderson told the Board of Commissioners in the memo.

When the commissioners decided on Aug. 7, 2007, to stay on course, despite a letter of protest from Mayor Jerry Sanders, Black began working with the mayor's staff and others, including Nancy Graham, then the president of Centre City Development Corp., to convince the Port to replace the metal building with something grander and more aesthetically pleasing.

By November of that year, and after several public workshops, they had succeeded—the Board of Commissioners voted to build what will be a permanent, 52,000-square-foot, environmentally forward terminal building on Broadway Pier. What was expected to cost roughly $6 million will now set the Port back more than $21 million, including $10 million from Carnival's loan. What was once urgently needed by the fall of 2008 is now scheduled for completion in December 2010.

It was Carnival Corporation that started everything by pressuring the Port in 2004 to fix up B Street Pier. And it was Carnival that told Sanders, late in 2007, that it didn't need Broadway Pier, according to another memo brought to light by Flannery, from Bruce Hollingsworth, then the Port's president, to a Carnival official. Yet it was Sanders who, nonetheless, pushed for a permanent structure on Broadway Pier. And now it's that structure, still under construction, that's standing in the way of grand park and a promenade on the pier.

No one from the Mayor's office responded to CityBeat's requests for comment.

“Port officials who continue to deny that a decade ago the Port promised an oval park at the foot of Broadway Pier and never mentioned a permanent, year-round cruise-ship terminal on the Pier are worse than members of the flat-Earth society,” writes Cory Briggs, the attorney for the Navy Broadway Complex Coalition, the activists fighting for creation of the park, in an e-mail to CityBeat. “Like flat-Earthers, the officials refuse to look at the mountains of evidence against them.”

Briggs sued the Port in August 2009 over the Broadway Pier terminal, alleging that the Port's permit to build it was illegal: It can't possibly comply with the Port Master Plan, the agency's guiding land-use blueprint, because the Port Master Plan depicts a large park straddling Harbor Drive and a promenade extending out onto the pier. The Port disagrees. That case is expected to go to trial in December.

Meanwhile, no money has yet been budgeted for work on B Street Pier. Gone are onceconsidered plans to build a new, 200,000square-foot terminal. That project “is no longer financially feasible,” Port spokesperson John Gilmore said this week. Instead, Gilmore added, current plans are to give the existing terminal a “major makeover.” Also, he said, the Port plans to remove three tents on B Street Pier and replace them with a new building for handling baggage and for Customs and Border Protection. The cost of the project is estimated at $28 million.

“These improvements will accommodate the larger cruise ships that many cruise lines are moving toward, and certainly the improvements will improve the ground transportation flow and passenger processing,” Gilmore said.

The size of ships and the economic state of the industry has been the subject of conversation between Carnival and the Port. In the December 2007 memo to a Carnival executive, Port President Hollingsworth summarized his understanding of what Carnival officials said during a meeting three weeks prior: “You do not anticipate having vessels larger than 2,500 passengers for the foreseeable future” and “You will need no more than 2 berths for the foreseeable future since you are not currently projecting any significant market growth on the west coast.”

Oivind Mathisen, editor of Cruise Industry News, says Gilmore's comment rings true—cruise companies have been moving toward larger ships. However, he said there's been a significant downturn in West Coast cruise business in the last couple of years, due to the swine flu outbreak, a perception of violence in Mexico, a new passenger tax in Alaska and the recession.

“What had been a growing business on the West Coast in the cruise industry—growing practically every year since 2000—suddenly came to a halt in 2009,” Mathisen said.

In fact, business slowed before that. In a November 2007 e-mail to Port officials that was made public by blogger Flannery, Carnival's Carlos Torres de Navarra talked about how economic changes were forcing a need to reassess the planned work on B Street Pier.

Contacted by CityBeat this week, Torres de Navarra declined to comment on vessel size, citing industry competition, but he did say that the company is no longer asking for renovations to B Street Pier. However, he added, it would be nice not to have to operate in a tent.

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