San Diego Mayor Dick Murphy resigned today as a federal investigation into the city's pension fund heated up. The 62-year-old Murphy will leave office July 15 and a special election will follow this November to choose his successor.

'It's clear to me that the city needs a fresh start,' Murphy told reporters as he announced his resignation in front of city hall.

The Securities and Exchange Commission is investigating the handling of the city's pension fund with rumors of fraud and corruption rampant. Just like week, 'Time' magazine named Murphy one of the nation's three worst mayors.

In addition, Murphy won a surprisingly close vote against Donny Frye who ran a write-in campaign. She claims she got more votes than Murphy but a number of the write-in ballots were disqualified on technicalities.

The city has been hurt by the scandal and investigation. While the audit is ongoing, the city is unable to issue bonds. The bonds are needed for water and sewer projects as well as the construction of fire houses and libraries. Standard and Poor's Ratings Service has even suspended the city's credit rating.

Despite Murphy's resignation, it seems like it will be a long time until San Diego's problems are fixed and the city is back on strong financial footing.