San Diego Port Commissioner and current Board Chairman Rafael Castellanos is weighing the prospect of working for the government agency in an entirely different capacity — as its next chief executive.
Earlier this year, after current Port of San Diego CEO Joe Stuyvesant was placed on istrative leave, Castellanos sought advice from California’s Fair Political Practices Commission on whether state conflict-of-interest laws would bar him from being hired by the port as its CEO.
The FPPC, which is tasked with enforcing the state’s ethics laws, said in a late September letter that the commissioner would be eligible for the CEO role — so long as he resigns from the board and plays absolutely no part in the agency’s hiring process.
The port did not share the letter with other commissioners, a representative with the agency said. The FPPC response letter was first reported by the San Diego Reader.
“It does not appear that Chair Castellanos has otherwise acted to influence the making of a future CEO contract to promote his personal financial interest in the position,” FPPC General Counsel Dave Bainbridge wrote in his analysis of Government Code Section 1090. Section 1090 bans public officers from entering into contracts in which they are financially interested. “Therefore, at this time, section 1090 would not prohibit a board contract for the CEO position with Chair Castellanos following his resignation.”
A commissioner has never in the agency’s history subsequently become its CEO, the spokesperson said.
Castellanos’ interest in the post comes amid a tumultuous period for the port, which is still navigating its way through choppy waters after the board’s unanimous decision to censure Commissioner Sandy Naranjo for misconduct in October.
As board chair, Castellanos has been one of the most vocal voices on the unpleasant matter. Earlier this week, he doubled-down on the necessity of the formal reprimand, which prevents Naranjo from serving as board chair, vice chair or secretary. He publicly expressed a lack of confidence in Naranjo, a sentiment that comes at the potential expense of his working relationship with the commissioner and National City, the member city she represents.
And, in July, the board unexpectedly placed current CEO Stuyvesant on paid istrative leave. It subsequently rehired Randa Coniglio to serve as acting CEO in Stuyvesant’s absence. Castellanos, however, did not participate in those decisions, the port representative confirmed.
When reached for comment, Castellanos acknowledged his interest in the not-yet-vacant CEO position.
“I am committed to doing what is best for the Port of San Diego and have always felt a strong sense of duty to serve it in the best way I possibly can,” Castellanos told the Union-Tribune. “Seeking guidance to determine my eligibility to serve in other leadership roles in the organization is therefore something I must do to consider all ways of being of service. I will always champion the port, its employees and the tremendous work the organization does to improve the quality of life of everyone who lives, works, and plays in the San Diego region and the state of California.”
Formed by the state in 1962, the San Diego Unified Port District is a special district that spans 34 miles of coastline from Shelter Island to the border. The bayfront territory includes land and water in five member cities: San Diego, National City, Chula Vista, Imperial Beach and Coronado.
The seven-member Board of Port Commissioners is responsible for setting district policy, enacting laws, approving lease agreements with major tenants and making important, waterfront real-estate decisions. The board is also directly response for hiring — and firing — port executives, as well as determining their compensation packages. Commissioners, who are appointed for four-year by their member cities, do not earn a salary.
Castellanos, a commercial real estate attorney, was appointed to the board by the city of San Diego in 2013, and is serving his third term as a port commissioner. His current term is set to end in 2024.
The 49-year-old Otay Mesa resident works as a partner at Solomon, Minton, Cardinal, Doyle & Smith in private practice, and has been with the firm since 2010. His law firm represents Sunroad Enterprises, which in late 2021 secured a development permit from the port to build a $160 million hotel on East Harbor Island. Castellanos recused himself from board votes related to the project.
Castellanos has also served on the board of the San Diego Regional Economic Development Corporation. He has also run for public office twice, first in 2016 for San Diego City Attorney and then in 2020 for San Diego County Supervisor, representing District 1. Both campaigns were unsuccessful.
The port CEO oversees the day-to-day operations of the 591-person agency, which is anticipated to generate $311 million in revenue for the fiscal year ending in June.
The CEO position is technically not open and the port is not recruiting for the position. The mysterious circumstances surrounding Stuyvesant’s sudden leave suggest that the situation will eventually come to a head. Coniglio is also limited in how many hours she can work for the agency, given her status as a rehired annuitant.
Stuyvesant, who was hired in early 2021, earns an annual salary of $351,000 and receives a $1,000 monthly car allowance.
Should Stuyvesant and the port officially part ways, the agency would likely undertake a comprehensive search process to find a replacement, as is routine. A proposed employment contract for a future candidate would require approval by four commissioners.
Castellanos could only be considered for the CEO position if he resigns from the board before the board considers an employment contract, the FPPC letter states. The letter is clear, however, that if he participates in any part of the hiring process, he would be ineligible to take the job or any other port leadership posts.
“If the board’s actions during his board hip involve planning or discussions about filling an employment position, including beginning a recruitment process, Chair Castellanos may not resign from the board and enter into contract for the position,” the letter states.
The real estate attorney would be a strong candidate for port CEO, said Gil Cabrera, who is board chair of the San Diego County Regional Airport Authority, an agency that works closely with the port. Cabrera, who is also an attorney, ran against Castellanos in 2016 for the city attorney job.
“I don’t think it’s outlandish. It could be an interesting idea — if he’s willing to do it. But that’s a big if because it’s a tough job,” Cabrera said. “He’s a real estate lawyer and that’s kind of what they do. A big part of (the port’s) portfolio is real estate and land use. I think, on paper, he’s probably pretty well qualified.”
National City Councilmember Marcus Bush, who earlier this week said he was “disgusted” by the board’s treatment of Naranjo, isn’t necessarily opposed to Castellanos being CEO. But he wonders if Castellanos’ interest in the position factored into his vote to censure the National City commissioner.
“It just raises a lot of questions with the timing,” Bush said. “Is this connected (to the censure)? Was she retaliated against?”
Tuesday, Commissioner Frank Urtasun was selected as board chair for 2024. Commissioner Danielle Moore and Commissioner Ann Moore were selected as vice chair and secretary, respectively.
