New City America

Li Mandri uses San Diego neighborhood's success as model for new century

By SCOTT LEWIS, The Daily Transcript

It takes a lot to shepherd someone through all the endless dollar signs, interest rates and legalisms that make up City Hall's ominous pension problem and still maintain their interest.

That is, until you effectively communicate that the massive deficit in the retirement system is at some point going to force the city to change things.

And while many are working furiously to get a handle on the extent of the problem -- and maybe mitigate it -- others, including Marco Li Mandri, are preparing for what he says is the inevitable.

It's as if he were watching everyone scramble to deal with global warming while he shopped for a bunch of canoes and a nice dry spot from which to sell them.

The era of getting good services from government -- if there ever was one -- is over, Li Mandri said.

"The only way cities will be able to deliver the services that people want is through a combination of general benefits provided by City Hall and special benefits controlled by locally based nonprofit corporations," Li Mandri said.

Creating those organizations that collect fees and deliver services for a group of neighbors is what Li Mandri does. And if you want to see a product of that effort, meet him in Little Italy someday.

The theory isn't complicated. This fiscal year, San Diego City Hall found itself bound by a lawsuit to infuse $45 million more into the pension system than it had last year, making for a total payment of $130 million. City staff estimates that by 2009, that annual payment will grow to $261 million.

"Who takes the hit on that?" Li Mandri asked during a recent interview. He was ready with an answer. "What gets cut are all of the soft costs -- the special benefits -- that make a city livable."

That includes litter and enhanced trash pickup, increased security, seasonal decorations and events and everything that should happen between the curbs and the buildings of urban neighborhoods.

Li Mandri's company, New City America, has organized or is in the process of organizing 31 assessment districts in California in addition to the one that his office is under in Little Italy.

On Wednesday, he said, he began work organizing the neighbors at Fisherman's Wharf in San Francisco.

The districts -- Business Improvement Districts or Property Improvement Districts -- can legally assess fees and are legally bound to keep that revenue in the neighborhood.

"People are much more open to paying into an assessment district because they can control it and they know where the money is being spent, as compared to giving a blank check to a city," Li Mandri said.

Once the owner of a restaurant, Li Mandri found himself in need of a new career in 1993 in the midst of a recession. He said he sensed that something was going to change in the way cities developed -- by looking at what was happening to shopping malls.

America's malls were being dramatically changed by the emergence of big-box retail outlets, Li Mandri said.

"Retail was becoming far more rational," he said. "The malls were in a state of crisis. And people were looking for a different type of relationship with their communities."

So now, he said, there's a change taking place in American cities. Where for more than a century so much energy had been spent moving people out of city centers and downtown areas, many are moving back in.

The Centre City Development Corp. reports that more than 27,000 people currently reside in downtown San Diego -- a number much larger than only a few years ago and still growing.

So while Americans may never relinquish the efficiency and cost benefits they enjoy while shopping at a large retail store, "We don't go there to hang out," he said. "We get there, get what we want and get out of there as quickly as possible because it's so alienating."

And where will people go? Li Mandri said more and more of them will turn to communities like Little Italy, where "every step means so much more."

Sherm Harmer, chairman of the San Diego Downtown Residential Marketing Alliance and a developer of one of the major projects in Little Italy, said Li Mandri is onto something.

"He's created a prototype, which is now being adopted throughout the state of California," Harmer said.

"Compare 300 linear feet in Little Italy to 300 feet in a mall. In Little Italy, you'll see friends, run into people. You'll walk by so many different kinds of things, every step is much more experiential," he said.

Finally, he said, the most important part: "You'll want to stay. Maybe, you'll want to live here."

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