Council pauses data centers; flat water rate replaces tiers after court loss

Revisions to Council Policy 100-03 (titled "Transient Occupancy Tax" on the agenda) that update the framework for the city's arts and culture grant programs, the Organizational Support Program and Creative Communities San Diego, and align the arts and culture funding area with others overseen by the Economic Development Department. According to the IBA's Division of Race and Equity, the new model would score applications 60% on demonstrated impact and 40% on annual operating income, instead of basing allocations almost entirely on operating income; would move payments from 85% upfront and 15% after year-end reports to a single upfront payment; and would create three subcategories separating smaller and emerging organizations from larger ones. Councilmembers also cited multi-year agreements and a simpler application. Who gets city arts grants, and how much, depends on this formula. It passed as part of the consent agenda. 00:12:35

• Jennifer Campbell (Councilmember, District 2) moved, and Raul Campillo (Councilmember, District 7) seconded, to adopt the consent agenda (Items 600 through 614), including Item 613. Result: passed, 8-0. 00:47:55

• The Independent Budget Analyst's office said, for its Division of Race and Equity, that an explicit amendment would be offered requiring recipients to incur and pay eligible expenses and provide proof, with payment schedules set in program guidelines and written agreements 00:13:04
• The Independent Budget Analyst's office noted that the new model moves grant payments from a split of 85% upfront and 15% after year-end reports to a single upfront payment 00:14:05
• The Independent Budget Analyst's office said the payment terms particularly affect historically underserved organizations and those serving low- to moderate-income communities, which often have smaller budgets and may lack cash to front costs and wait for reimbursement 00:14:05
• The Independent Budget Analyst's office explained that scoring would shift to 60% on an organization's demonstrated impact and 40% on its annual operating income, calling it a more equitable approach for smaller organizations 00:15:05
• The Independent Budget Analyst's office suggested that after this grant cycle the council could ask Cultural Affairs whether the 60/40 split should tilt further toward impact, and ask how panelists will score impact 00:15:05
• The Independent Budget Analyst's office recommended the council keep watching arts funding in next spring's proposed budget, since that amount determines whether every applicant can be funded and at what level 00:16:06
• A councilmember argued arts nonprofits should spend more time serving communities and less navigating city bureaucracy, calling the changes a good way forward 00:35:49
• A councilmember voiced strong support for multi-year agreements, upfront payments and a simpler application process 00:37:02
• A councilmember asked the mayor's office for a staff presentation on the changes at the ED and IR committee soon, noting it hadn't been able to go there first 00:37:02
• The mayor's office said it would bring an information update to the committee in the coming weeks 00:37:02
• A councilmember said moving to 100% upfront payments, as the council has already done with its own CPPS and ACCF funding, makes a large difference for smaller organizations 00:39:22
• A councilmember cautioned that the new system only works if the budget actually funds arts and culture, and said stability matters for small organizations 00:40:23
• A councilmember asked the mayor's office and the economic development director to respond to the Division of Race and Equity's analysis 00:42:00
• The Economic Development Department said the equity division went through the calculations with the department, and that the department wants to learn from how the new formula performs 00:42:44
• A councilmember said past funding cycles tended to favor established organizations expecting a trickle-down effect that does not work, and said he would be watching for true impact 00:43:30
• A councilmember cited the Design Capital 2024 effort as falling short on commitments to include smaller, grassroots organizations, especially in District 4 00:44:32
• A councilmember said he docketed the item because of application timelines, after verifying that extensive outreach had been done 00:46:26
• A councilmember said someone close to the issue told him smaller organizations would likely benefit and some bigger organizations would likely see less funding 00:46:26
• A councilmember noted that as a council policy it can be easily adjusted if results are not what the council hoped 00:47:29

First reading (introduction) of an ordinance amending the Municipal Code to prohibit smoking and vaping in outdoor dining areas citywide. Its sponsor said it sets one consistent citywide standard to protect diners from secondhand smoke and give restaurants clarity. It was introduced as part of the consent agenda, not yet adopted. 00:34:40

• Jennifer Campbell (Councilmember, District 2) moved, and Raul Campillo (Councilmember, District 7) seconded, to adopt the consent agenda, which introduced the Item 601 ordinance. Result: passed, 8-0. 00:47:55

• A councilmember said the ordinance sets a consistent citywide standard prohibiting smoking and vaping in outdoor dining areas, protecting health and giving restaurants and patrons clarity 00:34:40
• A councilmember credited research from San Diego State University's Center for Tobacco and Environment and input from the California Restaurant Association 00:34:40
• A councilmember supported the item as a step to let families and workers dine outdoors without secondhand smoke and vaping 00:38:15

Confirms a mayoral appointment to the Community Forest Advisory Board for a term ending December 31, 2027 (agenda). The agenda lists the affected areas as District 7 and outside city limits, and a councilmember noted the appointee doesn't live in the city. 00:35:49

• Jennifer Campbell (Councilmember, District 2) moved, and Raul Campillo (Councilmember, District 7) seconded, to adopt the consent agenda, including Item 609. Result: passed, 8-0. 00:47:55

• A councilmember thanked the appointee for volunteering and said he brings unique qualifications even though he is not a city resident 00:35:49

Adoption (second reading) of amendments to the city's Earned Sick Leave and Minimum Wage Ordinance meant to strengthen the city's ability to combat wage theft and to align the city's sick leave rules with state law. It was introduced 8-0 on October 13, 2026 (agenda) and adopted as part of the consent agenda. 00:38:15

• Jennifer Campbell (Councilmember, District 2) moved, and Raul Campillo (Councilmember, District 7) seconded, to adopt the consent agenda, including Item 604. Result: passed, 8-0. 00:47:55

• A councilmember thanked colleagues for supporting the amendments and called wage theft unacceptable, saying the changes help workers get the wages they earned 00:38:15

Declares city-owned property at 4069 30th Street (District 3) surplus land under the state Surplus Land Act, the step that comes before a notice of availability offering the site to others. The presiding officer asked that the offering favor a lease rather than a sale, which he tied to affordable housing. 00:45:24

• Jennifer Campbell (Councilmember, District 2) moved, and Raul Campillo (Councilmember, District 7) seconded, to adopt the consent agenda, including Item 612. Result: passed, 8-0. 00:47:55

• A councilmember thanked Economic Development and the Land Use and Housing Committee, which separated this property from others on a list, and asked that the notice of availability focus on leasing rather than sale 00:45:24
• A councilmember argued leasing can produce more truly affordable housing than a market-rate sale, and recalled that changes to Council Policy 700-10 made leasing the default 00:45:24

• Five members of the public commented on the consent agenda, one in person and four remotely, most of them on several items.
• Tijuana sewage emergency (Item 610): five speakers. One urged tariffs or cutting off water deliveries to Mexico until the pollution is fixed; one argued the city helped create the emergency by backing infrastructure decades ago and that it is now an ongoing condition rather than an emergency; one urged dialogue and cooperation with Mexican partners; one blamed state and Democratic leadership and money spent on studies; one questioned whether the repeatedly extended emergency has simply become how government works.
• Legal settlements (Items 607, 608): four speakers spoke on them. One said the La Jolla Terrace settlement was nearly $4 million and a sidewalk settlement about $250,000 (figures not in the agenda); one warned that with rising seas and stronger storms, damage like La Jolla Terrace's will cost taxpayers more unless the city inspects its underground infrastructure more thoroughly; one proposed tracking what plaintiffs do with settlement money; the in-person speaker asked when the city will fix sidewalks so such settlements stop.
• Arts and culture consolidation and funding policy (Items 603, 613): two speakers were unsure or concerned whether all organizations could be funded equitably and whether the merged department has enough resources; one praised the Division of Race and Equity's analysis. A different speaker called the racial equity work itself racist.
• Wage theft amendments (Item 604): two speakers supported them; one asked how the city would enforce them when undocumented workers fear employer retaliation.
• Petroleum pipeline franchise (Item 605): one speaker questioned how a 25-year petroleum pipeline franchise fits the city's climate action plan and why it is exempt from CEQA.
• Outdoor dining smoking ban (Item 601): two speakers; one suggested recycling cigarette butts, and one supported the ban but asked what happens to hookah bars.
• Other items: one speaker asked whether the $7 million footwear contract (Item 602) was too high; one supported the wastewater vacuum-pumping contract (Item 611), and another used it to urge the city to examine groundwater and sea-level pressure on sewer pipes; one supported declaring the 30th Street property surplus (Item 612).
• During councilmember comments, a person in chambers interrupted; the presiding officer said someone would come talk with him and continued the meeting.

• The mayor's office said it would bring an information update on the Item 613 arts funding changes to the council's ED and IR committee in the coming weeks, at Raul Campillo (Councilmember, District 7)'s request.
• Item S401, originally set for Monday afternoon, was moved to Tuesday, October 27, 10 a.m. session as Item S510. The presiding officer said it requires eight votes and was moved so the full council could consider it.
• Consent items normally heard Tuesday morning were handled at this special Monday meeting, and consent will not be taken up Tuesday. Afterward the special meeting was adjourned; the presiding officer said the council would then convene its regular Monday meeting, starting with public comment on closed session items. The recording ends before the regular meeting convenes.
• The Item 601 smoking and vaping ordinance and the Item 605 pipeline franchise ordinance were only introduced and have not been adopted; the franchise ordinance requires 6 votes (agenda).
• For the 4069 30th Street property (Item 612), a notice of availability is to come next; the presiding officer asked that it favor a lease over a sale.
• The IBA's Division of Race and Equity recommended watching arts and culture funding in the proposed budget due next spring, and suggested revisiting the 60/40 scoring split after this grant cycle.
• A councilmember said he looks forward to presenting in the future on finding more sustainable arts and culture funding.

In the morning session the council took public comment on two pending lawsuits against the city, read into the record as CS1 and CS2, then went into closed session. Public commenters described CS1 as a sidewalk trip-and-fall case and CS2 as a suit over a police pursuit that ended in a crash in which two young brothers died. The council's closed-session discussion isn't public, and the city attorney's office reported nothing out at the end of the day. 00:00:48

• Report out from closed session. Result: no action. 02:50:34

• The city clerk read the two existing-litigation matters into the record and corrected a date in the listing to 12/08/2023 00:00:54
• A councilmember closed public comment and recessed the council into closed session, to reconvene at 2 p.m. 00:13:44

Item S401 is an emergency ordinance that would put a temporary moratorium on developing, establishing, intensifying or expanding data centers citywide, along with a resolution finding the action exempt from state environmental review (CEQA). The agenda says the ordinance needs 8 votes under California Government Code section 65858 and isn't subject to the Mayor's veto. On Monday the item was returned to staff without presentation or deliberation, to be heard Tuesday, October 27, at 10 a.m. as Item S510. Public comment was still taken. 00:17:36

• Item S401 returned to staff, to be heard Tuesday, October 27, as Item S510. Result: continued. 00:17:36

• A councilmember announced that S401 would be heard Tuesday morning under a new item number, S510, and that there would be no presentation or council deliberation on Monday 00:17:36

An informational report from the Department of Finance on how the city's general fund ended fiscal year 2026 compared with the third-quarter projections. The fund ended $4.7 million short, so the city is drawing $4.7 million from its General Fund Stability Reserve to close the year balanced. The main cause was $7.4 million in state Cal OES reimbursements for the January 2024 storms, now expected in fiscal year 2027. Reserves are expected to fall to $202.4 million, or 10.9% of operating revenues, below the city's 14.1% target. The $1.7 million reserve contribution planned in the FY2027 budget is no longer expected. The Office of the Independent Budget Analyst also presented its analysis. It said this is the first time in recent history the city has drawn on the reserve, and it flagged a sharp drop in the risk management reserves. No vote was taken. 00:21:20

▶ Hear it Is dipping into reserves a wake-up call? · 0:51

• Informational item; no motion required. Result: no action. 01:02:40

• The Department of Finance explained that the report compares unaudited year-end revenues and expenditures with the third-quarter projections 00:22:02
• The Department of Finance reported that the projected available fund balance went from a positive $1.7 million to a negative $4.7 million, requiring a $4.7 million reserve draw 00:23:06
• The Department of Finance explained that much of the rise in both revenues and expenditures came from accounting entries for moving vehicles and equipment to the solid waste management fund, which largely cancel out 00:23:06
• The Department of Finance said property tax revenue fell because of lower collection rates, more refunds from assessment appeals and lower residual RPTTF revenue 00:25:09
• The Department of Finance said sales tax came in above expectations, citing resilient consumer spending and inflation 00:26:20
• The Department of Finance said accounting rules let the city recognize only part of the San Diego Zoo's advance payment in FY2026, with the rest counted in FY2027 00:26:20
• The Department of Finance said later developments cut the projected balance by $18 million, to a $16.3 million shortfall, before mitigation 00:30:31
• The Department of Finance said $11.6 million in mitigation measures and positive developments reduced the shortfall to $4.7 million 00:31:34
• The Department of Finance reported that combined emergency and stability reserves will fall from $207.1 million to $202.4 million, below the 14.1% policy target 00:32:39
• The Department of Finance said no excess equity will be available and the $1.7 million reserve contribution planned in the FY2027 budget is no longer expected 00:32:39
• The Department of Finance said the $7.4 million in Cal OES storm reimbursements once expected in FY2026 is now expected in FY2027 00:33:53
• The Department of Finance reported a same-day update that the city has been approved for $450,000 of the $7.4 million so far 00:33:53
• The Department of Finance said Cal OES reimbursements received in 2027 will first go to replenish the stability reserve 00:34:56
• The Independent Budget Analyst's office said general fund spending ended about $2 million over the adopted budget, or $17.6 million under it without the solid waste asset transfer 00:40:00
• The Independent Budget Analyst's office said fire suppression constant staffing accounted for about $6.3 million, or 78%, of Fire-Rescue's overtime overage 00:40:00
• The Independent Budget Analyst's office said the Transportation department may be relying more heavily on overtime, and recommended closely monitoring overtime trends 00:41:00
• The Independent Budget Analyst's office said police overtime still came in over budget, but much closer to it and well below the last two years' actuals, and that the department's efforts appear to be working 00:41:00
• The Independent Budget Analyst's office noted this is the first time in recent history the city has drawn from the General Fund Reserve 00:42:24
• The Independent Budget Analyst's office said reserve levels will fall from 11.1% to 10.9% of operating revenues, against a 14.1% target 00:42:24
• The Independent Budget Analyst's office reported that the risk management reserves ended almost $50 million under target, or $40 million excluding a loan to the sewer fund 00:43:53
• The Independent Budget Analyst's office recommended that any Cal OES money beyond what the stability reserve needs go to the risk management reserves 00:43:53
• The Independent Budget Analyst's office said the Publishing Services fund's deficit more than doubled, from negative $800,000 to negative $1.7 million 00:44:58
• The Independent Budget Analyst's office said the EMS fund ended $5.3 million below the fund balance the current budget assumed would support the general fund 00:44:58
• The Independent Budget Analyst's office warned that the city has less room for mitigation measures than before, and urged realistic, conservative projections in future budgets 00:45:51
• The Department of Finance said the delayed reimbursements cover city costs for cleanup and recovery after the storms 01:03:11
• The Department of Finance attributed part of the delay to Cal OES's small staff 01:04:41
• A councilmember offered his office's help, including with state legislators, to speed up the reimbursement process, citing possible El Nino effects 01:04:52
• A councilmember noted that the council's budget had set out steps in case the Cal OES money came late, with the reimbursement going first to the stability reserve 01:05:22
• A councilmember cautioned that the years of property tax beating expectations appear to be over, given housing prices and high interest rates 01:05:22
• A councilmember flagged lower parking meter operations revenue as a significant variance to watch 01:06:23
• A councilmember warned that many one-time resources the city has relied on are no longer available for future budgets 01:06:23
• The Department of Finance attributed the property tax dip to slower growth in assessed values, little housing turnover, and more and larger appeals, especially commercial 01:08:27
• The Department of Finance explained that lawsuit settlements are paid from the Public Liability Fund, which the general fund pays into 01:09:35
• A councilmember noted that if the $7.4 million had arrived, the city would have ended about $2.7 million ahead on a roughly $2.2 billion budget 01:10:13
• A councilmember said he would support putting all $7.4 million into reserve accounts when it arrives 01:10:13
• A councilmember noted the balanced budget still carries painful cuts, and encouraged the public to raise budget concerns year-round 01:11:17

A resolution updating two city fees that pay for enforcing San Diego's minimum wage and labor standards laws. First, the per-employee Minimum Wage Enforcement Fee that employers pay rises from $1.47 to $2.82 per covered employee, effective on approval. It now also covers the Hospitality Minimum Wage Ordinance and funds an added compliance officer. Second, a new one-time Compliance System Usage Fee, charged to prime contractors on city contracts, runs from $144.35 to $4,853.24 per contract across eight tiers based on contract value, effective January 1, 2027. Staff projected about $1.8 million a year in cost recovery once fully implemented. A third fee, for traffic control worker minimum wage enforcement, was deferred for more legal review. The council approved the resolution 7-0. 01:11:57

▶ Hear it Can the city fine employers who underpay workers? · 0:58

• Henry Foster (Councilmember, District 4) moved the staff recommendation, with staff's commitment to report on the fees in its annual reports; Sean Elo-Rivera (Councilmember, District 9) seconded. Result: passed, 7-0. 01:43:19

• The Office of Labor Standards and Enforcement presented the request to approve two cost-recovery fees for the city's labor standards programs 01:12:33
• The Office of Labor Standards and Enforcement said the two fees together are projected to recover about $1.8 million a year once fully implemented 01:13:39
• The Office of Labor Standards and Enforcement said a third fee for traffic control worker minimum wage enforcement was deferred for more legal review of possible exemptions 01:14:45
• The Office of Labor Standards and Enforcement said the office's duties grew with new ordinances but its staffing didn't 01:15:54
• The Office of Labor Standards and Enforcement said the minimum wage enforcement fee would rise from $1.47 to $2.82 per covered employee 01:16:58
• The Office of Labor Standards and Enforcement said about $1.5 million in annual program costs was divided by the estimated number of covered employees to set the fee 01:18:02
• The Office of Labor Standards and Enforcement said the compliance system fee would be charged to the prime contractor on a covered city contract 01:20:20
• The Office of Labor Standards and Enforcement described an eight-tier compliance system fee that rises with contract value and is charged once per contract, not annually 01:22:26
• The Office of Labor Standards and Enforcement gave the tier range as starting at $144.35 and rising to $4,853.24 for the largest contracts 01:22:26
• The Office of Labor Standards and Enforcement said outreach included notices sent to about 27,000 city vendors and contractors, plus direct contact with hotels and motels 01:23:37
• The Office of Labor Standards and Enforcement said the minimum wage fee would take effect on council approval and the compliance system fee on January 1, 2027 01:24:38
• A councilmember asked whether the council already gets annual reports on compliance efforts, so fee information could go in them, as the lodging association had requested 01:32:49
• The Office of Labor Standards and Enforcement agreed to include information about the fees in the office's existing annual reports 01:33:48
• The Office of Labor Standards and Enforcement named restaurants, hotels and motels, janitorial and construction as the industries with the most violations 01:35:10
• The Office of Labor Standards and Enforcement said the added compliance officer would allow proactive investigations that don't wait for complaints 01:35:42
• A councilmember said workers in those industries are vulnerable and often hold several jobs, and backed giving the office more resources 01:36:22
• A councilmember said he has long wanted new legislation paired with the capacity to enforce it 01:36:50
• A councilmember asked for a one-time first-year review of whether the fees are true cost recovery and whether they improve compliance 01:37:53
• A councilmember asked whether the city can impose penalties on minimum wage violators, beyond recovering back wages 01:39:30
• The Office of Labor Standards and Enforcement said the city has collected about $100,000 in penalties over the past ten years 01:40:01
• The Office of Labor Standards and Enforcement said the office often waives penalties in settlements to get small businesses to pay workers their back wages 01:40:13
• A councilmember argued that bad actors should pay more and compliant businesses less 01:40:51
• A councilmember urged the city to seek bigger penalties, rather than settle, where there is evidence of intentional underpayment 01:41:55

The council voted to propose overruling the San Diego Airport Land Use Commission. On July 9 the commission found Item 93 of the city's 2026 Land Development Code update inconsistent with the MCAS Miramar airport land use compatibility plan. Item 93 would allow new child care centers as a limited use, capped at a 0.42 floor area ratio, in the Miramar 'transition zone', where new centers are now prohibited. Existing centers there may already expand or rebuild up to 300 people per acre, and staff said the cap matches that limit. State law requires a two-thirds vote at two separate public hearings to overrule the commission; the agenda says 6 votes were required. Next, the Planning Commission makes a recommendation, and a second full council hearing comes at least 45 days after this one. The agenda lists Districts 1 and 6 as affected, and staff named community planning areas including Torrey Pines, University, Mira Mesa, Clairemont and Kearny Mesa. The motion passed 6-0 with three members absent. 01:43:45

• Kent Lee (Councilmember, District 6; President Pro Tem, City Council) moved the staff recommendation: adopt a resolution proposing to overrule the Airport Land Use Commission's inconsistency determination for Item 93, send notice to the commission, Caltrans and the U.S. Marine Corps, and schedule the item at the Planning Commission; Sean Elo-Rivera (Councilmember, District 9) seconded. Result: passed, 6-0. 02:09:51

• The City Planning Department explained that the amendment would allow child care centers as a limited use with a 0.42 floor area ratio in the Miramar transition zone 01:44:43
• The City Planning Department noted that child care centers are currently prohibited in the transition zone 01:45:47
• The City Planning Department said the floor area cap for new centers matches the 300-people-per-acre limit already allowed for expanding existing centers 01:46:48
• The City Planning Department said the Airport Land Use Commission found Item 93 inconsistent at a July 9 hearing and found the rest of the code update consistent 01:47:49
• The City Planning Department said state law lets the council overrule the commission with a two-thirds vote at two separate public hearings 01:48:52
• The City Planning Department said neither the Miramar compatible use zone study nor the state handbook recommends a transition zone, which the commission added as an extra buffer 01:49:54
• The City Planning Department said centers would still have to meet existing airport noise rules, including a 45-decibel indoor level 01:51:55
• The City Planning Department said the item next needs a Planning Commission recommendation by November 01:53:59
• The City Planning Department reported that the Community Planners Committee opposed Item 93 in February 01:55:02
• The City Planning Department said the committee wanted centers in the zone to need a site development permit instead of a ministerial permit, because they would be close to the accident potential zone 01:55:02
• A councilmember said he had supported Item 93 as part of the 2026 Land Development Code package 02:02:28
• A councilmember distinguished the accident potential zones from the transition zone, which neither Miramar nor the state handbook recommends 02:02:28
• A councilmember cited the high cost of child care and the value of locating it near the employment centers in Sorrento Valley and Miramar 02:03:30
• A councilmember moved the staff recommendation to start the overrule process 02:04:34
• A councilmember said his office consulted a regional child care advocate, who supported the change 02:05:41
• A councilmember argued that more child care near people's jobs matters, citing the extra hour his family sometimes spends driving to child care 02:05:41
• A councilmember said most of the public comment on the item was wrong and stressed that the item is only a zoning matter 02:07:03
• A councilmember said he had voted against Item 93 earlier, partly out of frustration over an unrelated council decision about Little Italy 02:08:08
• A councilmember called the change a technical fix that makes new centers consistent with existing ones, rather than a policy shift, and staff agreed 02:08:08

• Closed session (CS1, CS2): six speakers. On the sidewalk trip-and-fall case, several argued that settlements drain money that could repair sidewalks. On the police pursuit case, speakers offered condolences for the two young brothers who died, urged a quick settlement (one noted it has been three years), questioned the city's pursuit policy, and suggested naming a stretch of freeway in the boys' memory. One speaker criticized councilmembers on the Public Safety Committee and the city's Flock surveillance contract.
• Item S401 (data center moratorium): three speakers, all supportive or neutral. One noted that federal action could still bring data centers, such as at NAVWAR, and one would have preferred the item be heard Monday.
• Item S400 (year-end financial report): about 13 speakers. Several questioned homelessness spending and the lack of performance metrics, and one asked that unspent homelessness money go to improving conditions at a city encampment. Others raised the cost of surveillance technology and lawsuit settlements, whether commercial properties are properly assessed (with a concern about the Midway Rising financing district), unmonitored city leases, out-of-town contracting, and the reserve draw as a warning sign. One praised the city's focus on fiscal stability, and one made allegations about the mayor's legal fees and a city-funded nonprofit.
• Item 200 (labor standards fees): eight speakers. The San Diego County Lodging Association supported the fees and asked for a report back within a year on how the money is used, and two other in-person speakers supported the item. One asked whether undocumented workers would be covered, one asked about protecting workers' right to unionize, and one caller opposed nearly doubling the fee during a budget crunch and questioned the Oakland comparison. The rest were off-topic or general.
• Item 201 (child care near MCAS Miramar): five speakers. Two in-person speakers opposed it, one raising child abuse and trafficking fears and one saying they wanted more information. Callers asked where the item fits among budget priorities while supporting child care needs, lamented the need for child care, and suggested putting centers outside flight areas.
• Non-agenda public comment: about 17 speakers. Three marked Red Ribbon Week and urged youth drug and marijuana prevention, and two or three criticized Flock cameras and police spending. Single speakers raised: blighted buildings in District 3, accountability for a police shooting, vacancies on the city's Human Relations Commission, delays in replacement ID cards from the DMV, the workload in Economic Development and Cultural Affairs, the city clerk's rules for submitting media, out-of-county contracting and settlements, alcohol license concentration and a proposed nightlife office, data centers and the Tijuana River, and general distrust of government. One caller made disparaging remarks about Muslim immigrants.

• The data center moratorium (S401) was scheduled to be heard Tuesday, October 27, at 10 a.m. as Item S510; the agenda said the emergency ordinance needed 8 votes.
• The council adjourned to its regular meeting on Tuesday, October 27, 2026, at 10 a.m.
• Department of Finance: an update on the Cal OES storm reimbursements will come in the FY2027 first-quarter budget monitoring report, and the FY2028-2032 five-year financial outlook is due in November.
• Proposed updates to the city's reserve policy are expected to be presented later this year, per finance staff.
• Cal OES reimbursements received in FY2027 are to go first to replenishing the $4.7 million stability reserve draw.
• Labor standards fees: the compliance system usage fee takes effect January 1, 2027. Staff agreed to report fee information in its annual reports, plus a one-time first-year review of cost recovery and effectiveness requested by Joe LaCava (Councilmember, District 1; President, City Council). The deferred traffic control worker fee is to come back separately.
• Item 201: notice of the proposed overrule goes to the Airport Land Use Commission, Caltrans and the U.S. Marine Corps. The Planning Commission is to make a recommendation (by November, per staff), then a second full council hearing at least 45 days after this one, again needing a two-thirds vote.
• Agenda public notice: the 'Cielo Mar' final map at 7303 La Jolla Shores Drive can be appealed within 10 calendar days of this meeting.

Four ceremonial proclamations, approved together: a day honoring the executive director of the Fair Housing Council of San Diego (Item 30, from Henry Foster (Councilmember, District 4) and Sean Elo-Rivera (Councilmember, District 9)); Mission Beach Women's Club Centennial Anniversary Day (S500, from Jennifer Campbell (Councilmember, District 2)); Handlery Hotel San Diego 70th Anniversary Day (S501, from Stephen Whitburn (Councilmember, District 3)); and Domestic Violence Awareness Month (S505, from Heather Ferbert (City Attorney), Marni von Wilpert (Councilmember, District 5) and Raul Campillo (Councilmember, District 7)). Members used them to highlight fair housing enforcement and the city's domestic violence services. 00:06:31

• Jennifer Campbell (Councilmember, District 2) moved to approve the proclamation items (30, S500, S501, S505); Sean Elo-Rivera (Councilmember, District 9) seconded. Result: passed, 9-0. 00:36:01

• Jennifer Campbell (Councilmember, District 2) moved the proclamations and proclaimed November 7, 2026 as the Mission Beach Women's Club's centennial day, crediting the club with a century of support for schools, youth sports and nonprofits 00:16:36
• A councilmember credited the honoree with more than 33 years of fair housing advocacy, including a national fair housing law conference she hosts in San Diego 00:18:14
• A councilmember seconded and joined in recognizing October 27, 2026 as the honoree's day in the city 00:20:29
• A councilmember described the honoree's decades of fair housing enforcement as head of the Fair Housing Council of San Diego and her service on the city's Senior Affairs Advisory Board 00:21:31
• A councilmember thanked the City Attorney's Office for the Family Justice Center, and urged people not to pull away from someone who has experienced domestic violence 00:23:35
• A councilmember noted that the city funds interim housing for domestic violence survivors and their children 00:25:33
• A councilmember presented the proclamation for the hotel's 70th anniversary and noted four generations of one family have run it 00:25:33
• A councilmember said domestic violence is the leading cause of women's homelessness in San Diego and thanked Family Justice Center officers, detectives and case managers 00:29:16
• A councilmember said funding domestic violence programs is a fight in the budget every year 00:30:16

An emergency ordinance, brought by the mayor's office after an executive order, that pauses citywide for 45 days the acceptance, processing and approval of permits for new, expanded or intensified data centers, plus a resolution finding it exempt from CEQA. Staff said the city's code doesn't define data centers and currently permits them under rules for telecom switching stations. They cited the facilities' demands on electricity, water and land and the risk of higher utility bills. The pause has exemptions, including small accessory server rooms, public safety and emergency communications facilities, telecom carrier and utility facilities, and minor repairs that don't add floor area, power or water demand. It doesn't apply to federal land, including the Navy's NAVWAR campus near Old Town, where news reports described a proposed 400-megawatt data center. The agenda says the ordinance needed 8 votes under state law and isn't subject to the mayor's veto. The item was moved from Monday so at least eight members would be present. 00:42:48

• Sean Elo-Rivera (Councilmember, District 9) moved the staff recommendation (CEQA exemption resolution, plus introduction and adoption of the emergency ordinance) with added direction that isn't written into the ordinance: staff notify the council within seven days of any data center developer inquiry; a set of principles for the permanent policy; progress updates from the working group, the first within 45 days; and lobbying by the Office of Government Affairs against a large data center at NAVWAR. Kent Lee (Councilmember, District 6; President Pro Tem, City Council) seconded. Result: passed, 9-0. 02:47:59

• The mayor's office said the municipal code doesn't define data centers, which are permitted today under rules written for telecom switching stations 00:44:35
• The mayor's office explained the ordinance would set a 45-day moratorium within the city's jurisdiction while rules are written 00:44:35
• The mayor's office acknowledged the moratorium does not settle what happens on the federally owned Navy site and said the city's government affairs team would press Sacramento and Washington 00:45:36
• City staff explained the ordinance takes effect immediately with a four-fifths vote and lasts 45 days, with a possible extension after another noticed hearing 00:47:41
• City staff noted the city has no land use authority over the federal NAVWAR site but said the proposal there shows how immediate the interest in large data centers is 00:50:53
• City staff listed exemptions, starting with accessory server rooms that serve only on-site operations 00:54:04
• City staff said the mayor signed an executive order last Thursday creating a stakeholder working group, whose input will shape Land Development Code amendments returning to council next year 00:55:05
• A councilmember allowed public comment on both the moratorium and the proposal on federal land, calling the federal proposal a separate matter 00:56:55
• A councilmember reminded members the emergency action needs eight yes votes, which is why it was moved from Monday 02:20:08
• City staff explained state law allows 45 days at first, then an extension of up to 10 months and 15 days, then another of up to a year 02:21:22
• A councilmember cited a Voice of San Diego report that a developer was exploring a 400-megawatt data center at the Navy site and called on the congressional delegation to stop it 02:23:49
• A councilmember asked staff about the ordinance's statement that industry representatives were interested in standalone data centers and vacant office space 02:23:49
• City staff answered that staff was mainly citing newspaper reports on the Navy site and possible downtown sites in empty buildings 02:24:27
• The mayor's office said the working group is still being formed and would include labor, community advocates, utility, water, housing, technology, environmental and higher education representatives 02:26:47
• A councilmember objected to including SDG&E in the working group and suggested San Diego Community Power instead 02:27:19
• A councilmember moved the item with added direction, including that staff notify the council within seven days of any inquiry from a prospective data center developer 02:28:34
• A councilmember proposed principles for the permanent policy: no by-right approval, approval only if housing isn't feasible on the site, all-renewable power, no fossil fuel backup, and recycled water for cooling 02:28:34
• A councilmember also asked for working group progress updates, the first within 45 days, and for the Office of Government Affairs to lobby against a large data center at NAVWAR 02:29:35
• A councilmember asked the city attorneys to confirm the added direction wouldn't compromise the moratorium's legal requirements 02:30:26
• A councilmember said he requested legal research on regulating data centers in early August and had been preparing a policy for his committee 02:31:20
• A councilmember described the Navy site proposal as a hyperscale campus of 400 to 500 megawatts, far larger than typical data centers 02:32:22
• A councilmember argued families and small businesses should not pay for data centers' water, power and infrastructure, and cited a recent papal encyclical on concentrated technological power 02:34:36
• A councilmember warned some members might need to leave by 1 p.m. and the item needed eight yes votes 02:36:21
• A councilmember said he was confident the council would extend the moratorium for the following ten and a half months 02:38:09
• A councilmember argued the Navy site, next to the Old Town Amtrak station and transit center, should be used for housing, including for service members 02:38:09
• A councilmember called the Navy site a once-in-a-generation opportunity for housing and transit-oriented development 02:40:16
• A councilmember asked whether the city, not an applicant, decides if a project qualifies for an exemption, and staff confirmed it does 02:41:18
• A councilmember said data centers must cover their own electricity and water costs and create good jobs for local skilled workers, and that she would vote yes 02:42:04
• A councilmember said he supports making things harder for data centers, as speakers urged, but that it will take time to make the required findings 02:44:31
• A councilmember called for studying the leverage the city has through its utility franchise agreement and its role in community power 02:45:32
• A councilmember warned the NAVWAR developer that if the data center proposal is a stalking horse for another agenda, there would be a price to pay 02:45:32
• An attorney for the city clarified for the record that the amendments are part of the motion but won't be written into the ordinance 02:47:08
• City staff said staff had no concerns with the added direction but would look into some items and report back 02:47:29

The city has to replace its tiered single-family water rates with one unitary rate per unit of water for all customer classes. A lawsuit by high-volume single-family users ended with courts ruling the tiers didn't meet Proposition 218's proof requirements, and the state Supreme Court declined review. Staff said total water revenue doesn't change, and the already-adopted 14.5% increase for January 1, 2027 stays in place. What changes is who pays: staff estimated a low-volume single-family customer pays about $5.62 more a month (7.1%) and a high-volume single-family customer about $19.52 less. The city is also paying a $40 million settlement council had already approved. The public hearing closed October 6, when protests fell far short of a majority. 03:41:59

▶ Hear it What if the city refused the court-ordered water rates? · 0:52

• Sean Elo-Rivera (Councilmember, District 9) moved the staff recommendation to approve the unitary water rate adjustments, with an added request that the Public Utilities Department work with the IBA to update and expand water customer assistance programs, identify resources including eligible non-rate revenue, and return to the Environment Committee with a framework and funding plan. Joe LaCava (Councilmember, District 1; President, City Council) seconded. Result: passed, 6-2. No: Henry Foster (Councilmember, District 4), Kent Lee (Councilmember, District 6; President Pro Tem, City Council). 04:36:03

• The city clerk reported 3,644 protests in the protest period, against the 132,968 needed for a majority protest 03:41:59
• City staff said the city disagrees with the court decision but is legally required to adopt a rate structure the court deems valid 03:43:48
• City staff pointed customers who can't afford the change to zero-interest payment options 03:44:48
• City staff explained that the plaintiffs, high-volume single-family users, argued they were subsidizing lower tiers 03:45:53
• City staff said the courts didn't reject industry-standard cost allocation, only found it didn't meet Prop 218's burden of proof 03:45:53
• City staff said the city must pay a $40 million settlement and the planned 14.5% increase for January 1, 2027 is unchanged 03:48:02
• City staff said no more capital projects need to be delayed to cover the settlement, and total revenue collected stays the same 03:48:02
• City staff estimated a low-volume single-family user's bill rises about $5.62 a month 03:50:07
• City staff estimated a high-volume single-family user's bill falls about $19.52 a month 03:51:09
• City staff said the required notice went to about 286,000 customers, and 27 legal objections are in the docket with responses 03:51:09
• The Independent Budget Analyst's office said the existing tiers rested on standard industry methods but strongly cautioned against rejecting the proposal, warning that more litigation costs would ultimately fall on ratepayers 03:54:15
• A councilmember said the ruling penalizes customers who conserved and rewards those who didn't 04:09:53
• City staff described efforts to raise non-rate revenue from leasing department property, solar and grants, and said staff would return in February with the cost of service study 04:12:04
• City staff said tiered rates could come back under a new state law, AB 2180, but not before rate increases after 2030, while a pending case tests how the law applies 04:14:34
• City staff said the state Supreme Court asked for briefing on how AB 2180 applies in a case against the Los Angeles Department of Water and Power 04:15:36
• A councilmember blamed anti-government activists and the wealthy for state rules that limit fair fee structures 04:16:41
• A councilmember moved the staff recommendation, adding a request that the utilities department and the IBA expand water customer assistance programs and return to the Environment Committee with a funding plan 04:18:58
• A councilmember seconded, noting other water agencies statewide use the same method the city was faulted for 04:19:46
• A councilmember asked about state efforts to create low-income relief for water like the one that exists for electricity 04:20:47
• City staff said staff supports legislative efforts for a statewide water subsidy program 04:21:29
• Jennifer Campbell (Councilmember, District 2) explained the case's history for the public, saying it began in 2015, and said the city must comply or face fines 04:22:34
• City staff said not complying would bring back the full $120 million judgment the city settled for $40 million, plus interest and penalties 04:27:54
• City staff estimated that the extra liability would equal layoffs of at least about 800 staff 04:28:29
• City staff said the next court hearing is around December 11 and the city agreed with the court to set rates effective January 1 04:30:37
• City staff said the water system's outstanding debt of $1 billion to $2 billion could be called if bond covenants are violated 04:31:37
• A councilmember noted a dissenting appellate judge found the city's work sufficient and the majority did not rule tiered rates improper in themselves 04:32:44
• A councilmember said he voted against the 2025 rate increase and would oppose this too, since it shifts costs to low users and smaller households 04:33:44
• A councilmember urged assistance for low-income households and seniors, noting the city just did so for trash fees 04:34:53
• A councilmember asked the mayor's office to confirm that a public commenter who had left was offered help 04:36:12
• The mayor's office said he walked the commenter out and offered to be a resource 04:36:45

A $5 million city loan (agenda) from the Low and Moderate Income Housing Asset Fund, under the Bridge to Home program, to Mission Gorge Optima LP. The developer is a partnership owned by Wakeland Housing and Development Corporation. The money goes to The Joule, a planned eight-story building at 6255 Mission Gorge Road in Grantville, District 7, with 208 affordable studio, two- and three-bedroom apartments for families earning 30% to 60% of area median income. Staff gave the loan terms as 3% simple interest over 55 years, repaid from residual receipts, with 55-year affordability covenants. The total project is estimated at about $169 million, and construction could start as early as the end of 2028. It was presented jointly with S507 but voted on separately. 04:37:18

▶ Hear it What a new affordable apartment costs to build · 0:28

• Raul Campillo (Councilmember, District 7) moved the staff recommendation on S506; Stephen Whitburn (Councilmember, District 3) seconded. Result: passed, 8-0. 05:07:39

• City staff asked council to authorize a $5 million loan from the Low and Moderate Income Housing Asset Fund for each of the two projects 04:38:23
• City staff said 30 Bridge to Home loans in all will create nearly 3,000 affordable homes, with eight funding rounds since 2021 04:39:30
• City staff described the eight-story project with 208 affordable apartments for families in Grantville 04:41:40
• City staff said the city loan works out to about $24,000 per apartment and $13,000 per bedroom, and the total cost to about $169 million 04:42:43
• City staff gave the loan terms: 3% simple interest, a 55-year term repaid from residual receipts, and 55-year affordability covenants 04:43:48
• City staff said construction could start as early as the end of 2028 and take about 26 months once financing is secured 04:44:56
• A councilmember noted 53 of the 208 homes are for extremely low-income households and that the county owns the site and chose the developer 04:56:56
• A councilmember stressed the site is in a high-resource census tract, saying the city has legal and moral obligations to add affordable housing in such neighborhoods 04:56:56
• A councilmember asked staff for cost per unit and per bedroom, which he said the council had come to expect 05:00:30
• City staff calculated total project cost at about $803,000 per unit and $444,000 per bedroom 05:05:07
• A councilmember said costs should be pushed as low as possible but per-bedroom cost better reflects how many people are housed 05:05:20

A $5 million city loan (agenda) from the Low and Moderate Income Housing Asset Fund, under the Bridge to Home program, to TSA Perm Housing LP for Phase II of the Salvation Army Rady Center at 825 7th Avenue in East Village, District 3. Wakeland Housing and Development Corporation is building it on a 99-year ground lease from the Salvation Army. Staff described a six-story building with 89 affordable studio and one-bedroom apartments for seniors earning 30% to 60% of area median income. Total cost is about $64 million, and construction could start as early as the end of 2027. The loan terms are the same as S506. 04:37:18

• Stephen Whitburn (Councilmember, District 3) moved the staff recommendation on S507; Raul Campillo (Councilmember, District 7) seconded. Result: passed, 8-0. 05:08:33

• City staff said the site is owned by the Salvation Army and will be built under a 99-year ground lease 04:40:33
• City staff described a six-story building with 89 affordable studios and one-bedrooms for senior households 04:43:48
• City staff said the loan is about $56,000 per apartment and per bedroom, with a total project cost of about $64 million 04:43:48
• City staff said construction could begin as early as the end of 2027 04:44:56
• A councilmember backed the project in his district, saying too many seniors are being priced out and falling into homelessness 04:59:42
• A councilmember asked why the downtown building is only six stories, and a developer representative said the roughly 90-unit count reflected the Salvation Army's vision and available financing 05:05:48

• Proclamations (Items 30, S500, S501, S505): about seven speakers, one in person and the rest remote. Several praised the fair housing honoree, including a longtime colleague calling from out of state and a relative. Others spoke on Domestic Violence Awareness Month, and one urged attention to alcohol and drugs as factors in domestic violence.
• Data center moratorium (S510): the clerk said 45 speakers were signed up at the start. Roughly 70 spoke in total, nearly 30 in person and about 40 remote. Nearly all supported the moratorium, and many said 45 days was too short and asked for a year or longer, or a permanent ban. Common reasons were high SDG&E electricity bills, water use in a drought-prone region, noise, air pollution from backup generators, loss of land that could be used for housing, and wildlife. Many opposed the data center reported for the Navy's NAVWAR/Old Town site and urged federal action. Several urged a no vote on Proposition 45. Speakers included about five from the Sierra Club, two from San Diego 350, and representatives of the Environmental Health Coalition, the Coastal Environmental Rights Foundation, the Center on Policy Initiatives and a worker group. Two in-person speakers performed satirical characters mocking the pro-data-center side. Two callers urged the city to make utility hookups for data centers prohibitively expensive. The clerk reported 6 more in-person slips in favor without speaking and 157 written eComments in favor and 41 opposed, then clarified that all 41 opposed comments were against data centers.
• Non-agenda public comment (morning session, extended past noon): about 25 speakers. Four asked the city to repair the deteriorated, non-ADA-compliant parking lot at the Mira Mesa Senior Center; one said a 900-signature petition was being submitted to Kent Lee (Councilmember, District 6; President Pro Tem, City Council) and suggested two Mira Mesa funds to pay for it. About five raised youth substance use, marijuana and vaping, asking for limits on cannabis advertising and businesses and for a smoke-free public places ordinance; one speaker objected that these issues shouldn't take priority over housing and the sewage crisis. One alleged serious misconduct by staff at a city-contracted safe lot operator and asked for an independent investigation. Others asked to keep the Mission Bay restrooms open permanently, complained about La Jolla Cove, urged dropping Flock license plate readers, told members to look attentive to speakers, and alleged remote callers were being prevented from unmuting. Several thanked members.
• Water rates (Item 330): about 11 speakers. Most opposed or criticized the increase, citing affordability and conservation efforts. One in-person speaker said her bill had risen sharply despite heavy conservation, and later interrupted the hearing. One caller criticized outreach for relying on the Union-Tribune rather than community newspapers. One questioned the role of personnel and contract costs. San Diego Coastkeeper asked the council to start a new cost-of-service study to restore conservation tiers and to treat the flat rate as temporary. One speaker supported the staff recommendation as legally necessary.
• Affordable housing loans (S506, S507): six speakers. Two in person and two remote supported the projects, including the Downtown San Diego Partnership for S507. One opposed both for reasons unrelated to the projects. One caller questioned S507's per-unit cost and whether the city would ever recover the loan.

• Data center moratorium: it lasts 45 days from passage. Staff said it can be extended up to 10 months and 15 days after another noticed public hearing, then up to one more year. Kent Lee (Councilmember, District 6; President Pro Tem, City Council) predicted the council would approve the longer extension.
• Sean Elo-Rivera (Councilmember, District 9)'s motion asks the mayor's data center working group to report progress back to council, the first update within 45 days. The City Planning Department is to bring Land Development Code amendments regulating data centers to council next year.
• Staff is to notify the council within seven days of any inquiry from a prospective data center developer, and the Office of Government Affairs is to lobby against a large data center at NAVWAR (direction in the motion, not in the ordinance).
• Water: the new unitary rates and the previously adopted 14.5% increase take effect January 1, 2027. Staff said the next court hearing in the case is around December 11.
• Public Utilities plans to return in February with its cost of service study and an update on customer relief options. Separately, it is to work with the IBA and bring a framework and funding plan for expanded water customer assistance to the Environment Committee.
• Staff said reintroducing tiered water rates would be considered only for increases taking effect after 2030, after a pending state Supreme Court case on AB 2180.
• Bridge to Home: three remaining Round 7 loan agreements come to council early next year, and Round 8 applications are under review.
• Next council meeting: Monday, November 9, 2026, at 10 a.m. There are no council meetings on Monday, November 2, or Tuesday, November 3.
• Public notice (agenda): the City Engineer approves the 'Harvey Milk' final map at 1661 Harvey Milk St. Appeals are due to the City Clerk within 10 calendar days of this meeting.