SAN FRANCISCO (Reuters) - San Diego Mayor Jerry Sanders has won re-election, according to election results on Wednesday, leaving him at the helm of this southern California city as it recovers from the pension fund scandal that shut it out of the municipal debt market.
Sanders won 54 percent of the votes in Tuesday’s election, according to unofficial results from 100 percent of precincts posted on the San Diego County registrar of voters’ website.
The victory allows him to move forward on efforts to revive San Diego’s reputation with Wall Street credit rating agencies, notably publishing long-awaited audits of the city’s books.
Sanders spokesman Fred Sainz said one of the mayor’s first meetings on Wednesday had been with Fitch Ratings to discuss changes to the city’s finances that could prompt the agency to upgrade the city’s debt rating.
The rating agencies are growing more confident that San Diego, California’s second-largest city, is putting its pension fund scandal, and its effect on the city’s finances, behind it.
San Diego has been locked out of the public debt market since early 2004 after a whistle-blower revealed an earlier bond offering by the city misstated its pension debt by about $1.4 billion.
Federal, state prosecutors and the U.S. Securities and Exchange Commission investigations followed as did a shake-up at San Diego’s City Hall, which brought Sanders into office.
Standard & Poor’s Ratings Services last month reinstated its “A” underlying rating and positive outlook for San Diego’s general obligation bonds, lease revenue bonds and certificates of participation.
S&P also reinstated its “AA-” rating on the city’s water utility revenue bonds and its “A+” rating on both the city’s subordinate water utility revenue bonds and its wastewater utility revenue debt.
Over the next few weeks, Sanders plans to impress upon the City Council the need to overhaul the city budget and pension system -- aims that are intended to assure credit rating agencies, according to a statement provided to Reuters by Sainz.
Over the next few months, Sanders also plans new financial controls, to release audited financial statements for the city’s 2007 and 2008 fiscal years, and to improve public works.
Reporting by Jim Christie; Editing by Jan Paschal