“Concerning” was the word of the night.
Convention and Visitors Bureau services will screech to a halt in light of audit findings, leaving the word on the lips of every Santa Clara City Council Member, several members of the public, the City Attorney and City Manager, who all uttered the word several times Tuesday night.
After the Council discovered last month that the Chamber of Commerce had received an increase in funding without its approval, it ordered an audit to examine Chamber practices, which includes the Convention and Visitors Bureau (CVB).
City Manager Deanna Santa said, although early in the process, the auditor’s findings reveal conflicts of interest — including self-dealing — and mismanagement of public money.
The management agreement for the CVB is set to expire June 30. Because Santana and City Attorney Brian Doyle repeatedly and vehemently cautioned the Council against extending the contract until the audit’s full findings could come to light, CVB operations will cease for at least 30 days.
“What we have been unable to uncover with what little information we have been able to get … [is] very troubling,” Doyle said. “I don’t see how you could just extend the agreement and pretend there hasn’t been some serious misconduct.”
Requests for “very basic” management documents have been met with resistance, Santana said, adding that some of the documents did not arrive until 20 minutes before the Council’s meeting. When she saw that the requested documents were dated 2016, she said, it became clear that the documents were available all along, saying there may be a “good faith” issue with the Chamber.
Although the results are preliminary, the audit suggests the Chamber may have cost the City significant revenue by providing discounts to Chamber members to rent city-owned space. Other examples Santana and others called self-dealing include the suggestion that the Chamber held political fundraisers on public property and its purchasing promotional ad space from Chamber Member and Publisher of the Santa Clara Weekly Miles Barber at a 30 percent discount.
Doyle said the Chamber “doesn’t understand its responsibilities” and getting documentation from its leadership has been “like pulling teeth.”
Nick Kaspar, President of the CVB, apologized for the delay providing the documents, blaming the situation on many recent changes within the organization.
“We know there have been concerns in the past, and we are working to fix this,” he said.
The CVB employs 14 people, seemingly all of whom turned out to the Council meeting to plead for their jobs. Many were keen to point out all the good the CVB does for the City.
Ravinder Lal, owner of a UPS store and Chamber Member, said he looked forward to the audit being complete because it will show there has been no wrongdoing. He said he felt like his name was “being dragged through the mud.”
“I have been made to feel ashamed that I am part of an organization that is doing good things,” he said.
However, Mayor Lisa Gillmor said the issue on the table is not whether the CVB is good for the City. She said she doesn’t blame any of the employees, but the Chamber leadership has forced the Council’s hand.
“We have to take this seriously,” she said. “We don’t have a choice.”
On the suggestion of Santana, the Council voted unanimously on a middle ground where it will transfer money from the Chamber’s reserve — roughly $170,000 — to the City and use it to pay the CVB employees until a more long-term solution can be worked out.
California Voting Rights Act Lawsuit
Part of the reason the avoiding an interruption of services at the CVB proved unrealistic was a recent court order. That order, handed down Tuesday by Judge Thomas Kuhnle, requires that the City provide remedies for its violation of the California Voting Rights Act.
Hopes that Measure A, which aimed to divide the City into two districts and put in place ranked choice voting, would ameliorate such claims fell flat earlier this month when the measure failed. The City must now hold two public hearings before July 9 and two more between July 11 and 22 to determine districts for each Council seat.
In a closed session prior to the meeting, the Council voted unanimously to appeal the order.
Many, including the mayor, saw fit to blame Council Members Pat Kolstad and Patricia Mahan for the debacle.
“[H]ad we appointed a council member at our last meeting, had we taken the actions we should have taken as a Council, we wouldn’t be sitting here,” Gillmor said.
Teresa Sulcer, who sat on the 2017 Charter Review Committee, said she was “truly appalled” at Mahan and Kolstad, accusing them of sabotaging the process of appointing a council member. She said they “reneged on their duties and oath” and called for the Council to censure them.
Council mainstay Hosam Haggag took his criticisms a step further, spewing vitriol, repeating “shame on you” and threatening to have Doyle explain the process for a recall.
The Council authorized Santana to spend up to $600,000 to hire consultants to conduct public outreach and configure the districts. Judge Kuhnle wrote that he expects to have a final decision on remedies by Aug. 3.
Land Use
The Council also approved a development on Pomeroy Avenue and took action to re-secure a parcel on Great America Parkway.
The parcel on Great America Parkway was previously part of redevelopment agency land lost during its dissolution. However, the Council managed to reacquire the parking lot for $7.46 million over Jamestown, who bid $5.9 million. Because the City, as a tax entity, gets 10 percent of the proceeds, its bid was only 13 percent higher than Jamestown’s.
“It is pretty safe. It is a good deal for us,” Gillmor said.
Residents of an Eichler townhouse development wanted the Council to halt an adjacent four-townhome project underway until a federal survey of its historic significance could be completed.
Although the owners of 1075 Pomeroy agreed to nine of the 13 changes put forth at the Architectural Review Committee — where the project ended up after Council last considered it in March — neighbors still objected to the development. The setbacks were still inadequate and the roofs too high, they said.
The Council voted 5-1 to approve the project, redesignating it from low-density residential to planned development. Council Member Patricia Mahan was the lone “no” vote, citing a desire to maintain the integrity of Eichler neighborhoods.
Another development on the agenda — a mixed-use Old Quad project located at 575 Benton St. — was continued to July 17 so it could be heard at the same time as another project that has since been tied to it.
Tasman East Specific Plan
Before the start of the regular Council meeting, the Council held a study session to get updates on a 45-acre, 4,500-apartment project that could take 20 years to complete.
The site, which is adjacent to the golf course set to be redeveloped, is an industrial area. Andrew Crabtree, Director of Community Development, said the development will spread out open space among five wards — station, bridge, hill, center and river — featuring high-density housing and commercial space. The main goal is to ensure the development has high connectivity to other natural amenities such as the Creek Trail, Ulistac, Central Park North and the Guadalupe River.
The project will feature buildings between five and eight stories with, what Crabtree called an “occasional tower.” It boasts 106,000 square feet of commercial space and 10 acres of parks. A 1,200 square-feet community room, open 6 to 9 p.m. Monday through Thursday, would also be available.
Allowing a place for the library’s bookmobile and the possibility of the site hosting a new school were also discussed.
To get to the number of apartments the City wants, Crabtree said a reduction in the affordable housing requirement provides developers an incentive to build higher density units.
Vice Mayor Kathy Watanabe said she hopes the project can “stay on track,” adding that one community room will “not be sufficient,” a sentiment Council Member Debi Davis echoed.
The key however, Gillmor said, is the connectivity and, because of how long-term the project is, not disturbing the businesses at the location.
“It is more important than ever that our future residents enjoy a high quality of life,” she said.
The Council meets again 7 p.m. Tuesday, July 10 in the Council Chambers at City Hall, 1500 Warburton Ave. in Santa Clara.