Who Runs San Diego?

Who Runs San Diego? The City’s Dubious Partnership with Sea World

Linda Perine argues that in the interconnected world of Who Runs San Diego it is the mutual back scratching benefit of interlocking boards and contributions to politicians that allows our Mayor and City Council to be so unquestioning in their support of this morally and fiscally compromised corporation.

By Linda Perine

San Diego taxpayers find ourselves as mainly unwitting, possibly unwilling and almost certainly undercompensated partners with a corporation in a Sea World of hurt.  From Wall Street to Austin City Limits, Washington to Sacramento, Hollywood to Lindbergh Field Sea World is under attack for its treatment of Orcas (that’s Shamu to you and me)

In July, 2013 the documentary Blackfish about the 2010 death of a Sea World trainer finally caught the public’s attention after decades of challenges to Cetacean captivity.  The 2009 Academy Award winning documentary The Cove also raised questions about the possibility that Sea World obtained dolphins from the horrific Taiji dolphin drive.

Sea World vehemently denied the assertions of both documentaries.  However, Sea World stock prices have been cut in half since the Blackfish premier.  Sea World is now the target of shareholder class action lawsuits involving at least 6 law firms specializing in securities fraud for initially denying that Blackfish negatively affected attendance and for misrepresentation about its treatment of Orcas in its prospectus when it went public in 2013.

SEaWorld AdBlackstone Group, the private equity firm that took Sea World public in 2013 is dramatically reducing its holdings as are othersignificant institutional investors.  Southwest Airlines has terminated its 26 year-long mutual promotion relationship with Sea World, as has Taco Bell.  Entertainers from Bare Naked Ladies to Willie Nelson have cancelled performances at Sea World venues in protest of their treatment of orcas

OSHA has told Sea World it must stop putting trainers in tanks during Shamu performances.  In 2015, the California Assembly will address AB2140,  a bill to ban holding orcas in captivity for performance or entertainment purposes in California and to end captive breeding programs.  The bill has the support of 1.2 million folk with more signing up every day.

In addition to the structural problem of a business model that is deeply unpopular and may soon become illegal, Sea World is in debt up to its flippers.

And I should care because……?

For better or worse, San Diego is closely tied to Sea World.

In 1964 the city leased land and water in Mission Bay Park giving “Sea World advantages that few if any theme parks in the region had. It specified a certain rate of return on profits to the city, guaranteed long-term access to valuable city real estate [on Mission Bay], and left open a door to future expansion of the theme park. Sea World has used this door often, expanding its original allocation to more than 150 acres.”

We, the citizens of San Diego, are Sea World’s landlord.  More accurately, we are business partners.

We, the citizens of San Diego, are Sea World’s landlord.  More accurately, we are business partners.

The lease provides that the city is paid varying percentages of the income Sea World receives from things like admission charges, parking and the sale of those cute stuffed Shamu dolls.  Last year Sea World paid the city  $14 million dollars,a figure that critics say should be much higher given the valuable city assets Sea World has obtained from the city.  Sea World also paid about $5 million in taxes last year on property valued at $425 million.

In addition to real estate and transportation concessions, we allocate millions of our public tax dollars each year to promote this private enterprise .

Shamu and Sea World have been a huge part of tourism promotion and city identity for 50 years.  This is why more and more citizens are concerned that changes in the way the world views the captivity and commercial exploitation of highly intelligent, social mammals will injure our city’s image as well as our city coffers.

From Enron by the Sea to the recent Balboa Park Centennial fiasco to the take down of Bob Filner we have suffered a number of body blows to our city’s public image.  Civic leaders need to address the image crisis and the looming fiscal crisis Sea World’s flawed corporate strategy represents.

The Silly, Silly Whale in the Room

Blackfish has been a publicity nightmare for Sea World and Sea World clearly has a growing image problem.

At the AB2140 hearings in Sacramento Scott Welsh, the lobbyist for Sea World, called AB2140 a “silly, silly bill.”  He went on to threaten that Sea World would simply move the orcas out of San Diego to another state if the bill advanced. SeaWorld San Diego President John Reilly bluntly claimed the bill was simply “animal rights rhetoric and bias.”

When SeaWorld ENTERTAINMENT Inc. went public almost a year ago, it bragged: “We won’t be a taxpayer for several years to come,” SeaWorld President and Chief Executive Officer Jim Atchison told prospective investors shortly before the company went public. “That’s a great advantage for us.”

Keep in mind the multiple lawsuits arising from Sea World’s misleading assertion that Blackfish did not impact attendance.

Peta SEaworld AdGiven the smarter business plan of “phasing out shows, placing its female killer whales on oral contraception, & leading the way on coastal sanctuaries” SeaWorld pompously announces more captivity, more pools, more breeding, and international expansion.

Immediately after the precipitous plummet of its stock price Sea World announced with great fanfare the “Blue World Project”: SeaWorld would spend millions to build a 50×350 foot pool.  Mayor Kevin Faulconer and Councilmember Todd Gloria were on hand to assure us this would address the captivity issues of a 30 foot long 8 ton mammal designed by nature to swim 100 miles a day and dive 1000 feet into its deep wild ocean habitat.

Gloria was “grateful to SeaWorld for the investment in these new facilities.” CEO Jim Atchinson told The Today Show August 15 “We make no apologies for what we do and how we do it.”

The arrogance is simply staggering.

It’s Not Just Love that Means Never Having to Say You’re Sorry

Being very well connected and making a lot of contributions to politicians allows a business a fair amount of leeway, especially in San Diego.

As Voice of San Diego pointed out in one of its somewhat boosterish articles Sea World By the Numbers  Sea World employs up to 4,500 people, albeit many are temporary positions and minimum wage.

As was mentioned before, Sea World pays a percentage of its income as rent on a lease to the City that some view as extraordinarily favorable to Sea World.  While putting $14 million into the public coffers may be an attention getter, it is nowhere near what it ought to be.

…it is the mutual back scratching benefit of interlocking boards and contributions to politicians that allows our Mayor and City Council to be so unquestioning in their support of this morally and fiscally compromised corporation.

Sea World is deeply imbedded in the San Diego conservative hierarchy.  It is a heavy contributor to the PACs of the Lincoln Club,the California Restaurant Association’s local chapter and the San Diego Regional Chamber of Commerce.   Sea World has a presence on the board of many local organizations like San Diego County Taxpayers Association, Equinox, San Diego Tourism Authority, the Chamber and many others.

Yes, that is the same Lincoln Club, Taxpayers Association, Chamber and Mayor who oppose increasing the minimum wage so that the workers at Sea World can afford to feed their kids.  So, no, they are not going to get all misty eyed over some “black fish”.

In the interconnected world of Who Runs San Diego it is the mutual back scratching benefit of interlocking boards and contributions to politicians that allows our Mayor and City Council to be so unquestioning in their support of this morally and fiscally compromised corporation.

Sea World is imbedded. It’s a player.  As its Prez said – they make no apologies.  And we are to be grateful?

What’s a Shamu Loving, Regular Taxpayer Who is Tired of Giving Away the Farm to People Behaving Badly To Do?

Surprising as it may seem, we are not without resources.

  1. Let your councilmember know this sucking up to bad corporate behavior displeases you and you vote.
  2. Encourage the city council to enforce the lease.   As I read the lease it requires that the City Council approve Activities other than operating an Aquarium “as may from time to time be deemed desirable to serve the patrons of” the then Marine Life Exhibit.  Good luck with that, but it does seem to suggest that the City is entitled by the lease to take a more active role in the Sea World decision making process.  It is our bay, our water, our 170 acres.  Maybe we could encourage them to take a look at ways of making money that are not so Shamu-centric.
  3. Enforce the City Charter.  Some folks think that Sea World sits on Pueblo Land and the City Charterdisallows leases of longer than 15 years for those lands.  It is certainly worth discussing.
  4. The SEC may be taking a long look at Sea World for a variety of reasons: some less than forthcoming disclosures about the “problem with Tilikum”; misleading the public about Blackfish’s negative effects on admissions; a possible takeover bid by a theme park not wedded to the captivity of cetaceans.  The City might play a role in those conversations.
  5. If the “Blue World Project” was more than smoke and mirrors, Sea World will need to dredge Mission Bay, do an EIR, get Coastal Commission approval and amend the lease.  This is a wonderful opportunity for some negotiating on lease payments and the treatment of Shamu.

Orca in a bowlThe first article I wrote about Sea World got over 2,200 likes.  It was tweeted nearly 500 times.  I am not widely known, nor is SDFP the NYT.  That means there are a LOT of people committed to the idea that the cessation of cetacean captivity is an idea whose time has come.  Hopefully, some of those people are also committed to the idea that San Diego needs to stop giving away our beaches and bays and other precious resources to the well connected and the big contributors.

Here are the e-mail addresses for the city council and the mayor.  Maybe we should talk to them.

District 1
Council President Pro Tem Sherri Lightner

District 2
Councilmember Ed Harris

District 3 
Council President Todd Gloria

District 4
Councilmember Myrtle Cole

District 5 
Councilmember Mark Kersey

District 6
Councilmember Lorie Zapf

District 7
Councilmember Scott Sherman

District 8 
Councilmember David Alvarez

District 9
Councilmember Marti Emerald

Mayor Kevin Faulconer

Linda Perine is the President of the Democratic Woman’s Club. She was chair of the LGBT Redistricting task Force in 2011 and served as Mayor Filner’s Director of Community Outreach.

This article first appeared in the San Diego Free Press October 3, 2014.