City Manager’s Contract Triggers Intense Debate

A standard administrative item devolved into a nearly three hour back-and-forth with council members and the city manager lobbing accusations at one another. The seemingly routine item, continued from last week, was simply to publish the salary schedule for City employees’ cost of living adjustments (COLA), but turned into a debate about whether City Manager Deanna Santana should get a raise.

Santana’s pay is tied to Unit 9. Because of this, she was ineligible for a COLA in 2020 and 2021. She also has had to forgo merit increases to her pay for two years to help the City cope with the financial downturn caused by the pandemic. Despite the frozen merit raise still being in effect, Santana, just as the rest of Unit 9, will get a 4.5 percent COLA in 2022. That amounts to a roughly $20,000 raise, bringing her total base salary to $468,673.

That some members of the Council seemed to think a discussion about such a raise was in order seemingly ruffled Santana’s feathers. She had choice words in response and accused the Council of leaking the details of her contract to the media.

“This is a new low. Comments like these are a form of workplace intimidation and hostility. It was flat out scary and plain sad to hear from many employees over the past week about their shared concerns for how insulted and demoralized they felt from those comments,” she said.

Both last week and Tuesday night, Council Member Anthony Becker and Vice Mayor Raj Chahal took issue with different aspects of the item. Chahal said City appointed roles — the City Attorney, City Auditor and City Manager — should be treated differently than other bargaining units.

“When City management, under the direction of the City Council, started the negotiations with various City units, to save the City some money, I think we had a moral and fiscal duty as a Council to start those negotiations with our appointees directly, because those three appointees cannot have negotiations with anybody except the City Council,” Chahal said.

When the item came up last week Becker and Chahal wanted to continue the amendment to Santana’s contract, but instead, at the behest of Assistant City Attorney Sujata Rueter and Mayor Lisa Gillmor, opted to continue the entire item. However, when the item returned Tuesday, the amendment was no longer included, something Santana described as a “mistake.” Distilling the two items into one, concerned Becker.

The discussion and confusion came to a fever pitch before Santana admitted that the amendment previously included had been done so erroneously.

Outside legal counsel, Charles Sakai, a partner at Sloan Sakai, had to repeatedly tell the Council — more than a dozen times — that the item before them was simply to adhere to CalPERS requirement to make the salary schedule public for transparency. The COLAs had already been approved by the Council last year and will go into effect Dec. 26, regardless of whether the Council approves the salary schedule.

Discussion bounced back and forth with the Council proposing four substitute motions. Gillmor called the situation “embarrassing,” adding that it created a “toxic environment,” an implication at Becker’s criticism. Becker in turn took umbrage with Gillmor, as he said, “gaslighting” him by claiming he had criticized City employees by questioning Unit 9, which he did not.

Ultimately, the Council unanimously approved the salary schedule and agreed to hold a closed session to discuss what it saw as a lack of clarity in Santana’s contract.

Council Approves Year-End Budget

As expected, the City’s general fund continues to flounder in the wake of the pandemic. Revenues were slightly above projections and expenditures were slightly below anticipated, said Kenn Lee, the City’s Finance Director. Despite this, he said, projections from back in March were more or less accurate.

That projection has the City running roughly a $6 million deficit. Lee said City employees have managed to offset $17 million of the projected $23 million shortfall. The biggest hit has come at the hands of an 87 percent reduction in transient occupancy tax (TOT) as well as a significant decrease in other City fees. The underperformance of these two revenue sources amounted to a loss of $32 million when compared to pre-COVID levels.

The biggest takeaway from the presentation was that, although City employees were able to mitigate losses from COVID, the City is still in a precarious financial position, mostly because it is unable to add any money to its reserves. However, it did allocate $5 million to its capital project reserve. The City has nearly $1 billion in capital project needs.

Chahal said the City’s inability to contribute to reserves concerned him in light of the looming pension deficit — roughly $600 million.

The Council unanimously approved the budget and also allocated $75,000 for a homeless relief program.

Apology Letter Task Force To Be Expanded

The Council approved expanding the committee it formed to draft an apology letter for the California Voting Rights Act (CVRA) lawsuit. Discussion of the item had been deferred three previous times after the Council approved the creation of a committee consisting of Council Members Anthony Becker and Kevin Park.

Becker had previously drafted a letter in which he apologized on behalf of the City for spending more than $6 million fighting the CVRA lawsuit. After the first meeting, Park and Becker returned to seek additional support from the Council, claiming that the meeting did not receive the support it needed.

Becker moved that the Council allow his draft letter to be published, that the City take a full factual history of the suit, ensure the meeting is well-noticed with a 6 or 7 p.m. start to ensure attendance and hold a closed session meeting to understand the liability about disclosing details of the lawsuit.

Sujata Rueter, Assistant City Attorney, told the Council that once it was “educated on the consequences and repercussions” of disclosing details about the suit, it can approve doing so by a Council majority in open session.

Mayor Lisa Gillmor said she saw little value in heeding the request, saying that with the cost of expanding the task force being unknown and given the possibility it will open the City to liability, the idea seemed “half-baked.”

Further, she said cataloguing a history of the suit — given that former City Attorney Brian Doyle had already done as much — is tantamount to “changing history.” Gillmor also pressed Becker as to whether “the 49ers had any hand in the authorship” of his letter.

Becker said he is the sole author of the letter.

Council Member Kathy Watanabe said the Council should drop the matter and continue to “move forward.” As with her previous statements toward the same end, she did not elaborate on what she meant by “move forward,” saying only that “dragging the issue out does not help; it divides.” Further, she added, expanding the scope of the task force is not a prudent use of City resources, which are in short supply these days.

“I don’t see the community knocking down doors looking to have this apology letter put together. A lot of our residents are focused on surviving COVID right now,” Watanabe said. “I truly think it is time for us to move on. [We would be] apologizing for a lawsuit against our City that was calling our residents racist; we defended a lawsuit that was brought against our City that called our residents racist. Our due diligence and our responsibility is to defend our City against uncalled for and untrue attacks like that.”

Other council members — Park, Chahal and Becker — contended with the idea that the lawsuit makes claims regarding whether Santa Clarans are racist, pointing to their support of the Stop Asian Hate movement.

The Council passed Becker’s motion 5-2 with Watanabe and Gillmor voting “no.”

Loyalton Ranch To Get Sold

After nearly nine months, the Council has decided to sell its Loyalton Ranch property. The item has been continued repeatedly since it was originally proposed in March. Last time the Council discussed the sale, it directed City employees to return with options regarding the sale of the ranch, which is being used for cattle grazing.

Like so many topics, selling the property divided the Council. Those in support of the sale have said the property, which saw a massive wildfire raze the buildings on it, is dead weight on the City, and, with the specter of the budget crisis brought on by COVID, the City could use all the revenue it can get.

On the other side of the coin, opponents of the sale — namely Watanabe and Gillmor — have said selling the property now makes little sense since the City will not get a good price for it given the current economic conditions.

Watanabe, who has previously made an appeal to tradition argued that Santa Clara doesn’t typically sell land so it should retain Loyalton. She quoted “Gone with the Wind,” saying that “Land is the only thing worth fighting for. It is the only thing that lasts.”

Gillmor said selling now would be foolhardy since the City will get an “extremely reduced value,” which would not “do justice to the ratepayers” of the City-owned utility company, Silicon Valley Power, which owns the land.

On more than one occasion, Gillmor has claimed that the City had a $10 million offer for the property in 2017, but records requests by The Weekly show no such offer was documented.

During the public comments for the item, a representative for the Wildlife Conservation Board expressed interest in purchasing the property.

Manuel Pineda, the City’s Chief Utility Officer, told the Council his team would need to develop a strategy for the sale of the property, which included getting a broker, looking at the rules for the Surplus Land Act and how it applies to the property and update the land’s value with an appraisal.

The Council voted 4-3 to sell, with Gillmor, Watanabe and Park voting “no.”

Council Rakes Blogger Over The Coals

At the conclusion of the meeting, Council Member Anthony Becker took a moment to criticize Robert Haugh, the mayor’s favored blogger, for publishing falsehoods about council members most notably in a post earlier this month.

Becker lambasted Haugh, the writer of Santa Clara News, for spreading “lies and misinformation” and Gillmor for sharing his stories. On a daily basis, Becker said, Haugh “almost commits libel.”

“The false news that, I think, the blog spreads through our community, I think damages the integrity of our leadership and our entire community’s City functions,” Becker said. “It is dangerous that it casts a bad light on the City as a whole, and it creates a more toxic-looking environment than it already is.”

He called the blog a “political hit job,” saying it “damages reputations.” He called for Gillmor to “denounced the hateful rhetoric” that he categorized as “racist and homophobic.”

Gillmor’s response was minimal, saying only that she was “offended,” the idea was “embarrassing” and “insulting” and that the Council was ending the year on a “low, low note.” Despite having little to say, Gillmor did, however, laugh at several intervals during Becker’s comments, to which Chahal responded to her that the situation was “no laughing matter.”

Park said he has no problem with the blog since it is “not a real news source” and that he finds it more “amusing” than anything. He called control of the media “one of the oldest political weapons.”

“The bigger issue is where do these lies come from?” Park said. “Who is feeding these blogs these lies?”

Consent Calendar Spending

The Council/Board approved the following spending in one motion via the consent calendar:

• A $234,000, three-year purchase order with Grand Electric and Construction Company for as-needed electrical repair services Citywide including Maintenance District #183;
• A five-year, $184,795 contract with Black & Veatch Management Consulting to prepare rate and fee study reports for the City’s water, sewer, and recycled water rates;
• A five-year, $750,000 contract with Mesa Energy Systems, Inc. for as-needed heating, ventilation, air conditioner and chiller inspection, maintenance and repair services;
• A $76,600 amendment to a contract with Wilson, Ihrig & Associates to expand the scope of services for noise monitoring. Total contract amount: $86,600.

The next regularly scheduled meeting is Tuesday, Jan. 11 in the Council Chambers at City Hall, 1500 Warburton Ave. in Santa Clara.

Members of the public can participate in the City Council meetings on Zoom at https://santaclaraca.zoom.us/j/99706759306; Meeting ID: 997-0675-9306 or call (669) 900-6833, via the City’s eComment (available during the meeting) or by email to PublicComment@santaclaraca.gov