The Billion Dollar Lie

The Truth Behind San Jose’s New City Hall

The new City Hall complex at Fourth and Santa Clara was built with the promise that it would save the city money.  But the truth is, much more money could have been saved if an honest and intelligent approach had been applied to the process.

In the spring of 2002, at the request of then-Councilmember Chuck Reed, the San Jose City Council sanctioned a study of alternative sites for the new City Hall.  Bids were solicited, accepted, and evaluated for a number of potential alternatives; but, when it came to studying what was then the existing City Hall site, no outside bids were considered by the city.  What’s more, the authors of the city report arbitrarily applied the high construction costs of the Meier design plan for the new complex to their so-called analysis of the existing City Hall site.

The deputy city manager’s report of May 8, 2002 read: “City costs for the project were assumed to be the same as the Fourth and Santa Clara Street site . . . which would be $288 million for the construction.”

At the time, the San Jose Business Journal calculated the estimated construction costs for the Meier design to be around $623 per square foot.  This figure was applied to the “analysis” of the existing City Hall site alternative.  (One might say that the city used the price of gold to determine how much it would cost to build with silver.)  As a result, the people of San Jose would never know how much money could have been saved by building a new facility at the existing City Hall site for the simple reason that the city never seriously considered the option.

Imagine if the process had been an honest and open one, and builders had been permitted to bid on the project.  We might have had a nice, new, and even bigger facility at the old site, and a savings of perhaps $100 million or more that could have been spent on city programs and services.

Pete Campbell is a former political writer for La Oferta newspaper.  He recently served as a member of the Reed Transition Team.

31 Comments

  1. DUH!  What is the point of your post we all know that it was a mistake. and they had their chance to change their minds a few times, but that’s it what’s been done is done!
    Now I don’t know what you had in mind when you wrote this maybe you were just bored b/c that’s all I get when I read it is BORED!

  2. Al Ruffo is rolling over and over and over in his grave.

    Hold on a bit, D.O.A & Taxpayer.  Yes, all of us cool SJInsiders know all of this, but there is still a bit to be gained from it.  We need t remind those in power now @ The Taj Gonzal, especially Campos, Williiams, Pyle and Chirco, that we shall not allow this kind of thing to happen again in San Jose.

    All the “Good Germans” who just went along, i.e., all Del’s cronies with no spines, need to be sent packing.  Serious housecleaning needs to occur in staff managers.

    While we’re at it, let’s just terminate 20% of all managers on general principle and for cost savings.  The government at all levels is bloated with managers who “manage” five people or fewer, and draw the larger salaries just to push paper up line and down line.  We need self-starters on staff who need less managing and do more work.  We need fewer managers who call endless meetings, taking staff members away from the jobs they are supposed to be doing.

  3. Pete—Thanks for bringing this up again. BIG subject. It raises many interesting issues: 1) now that SJ gummint is open and honest, let’s go back and revisit the real cost of the Albino Bldg. 2)Audit the number of employees still in other city and rented bldgs—old city hall, old library, etc., etc. The White Monster with the Dumb Dome (which houses no one? at a colossal cost). What’s the actual savings? What does this Union Project cost to keep afloat every year. 3) What economic impact has City Hall had on downtown SJ, if any? 4) Let’s be bold—keep the highrise for the bureaucrats, sell the DOME to Tiffany’s for a Jewelry Mart. THAT would bring folks in from the ‘burbs. 5) If “2” above reveals big gobs of bureaucrats spread all over, save money by buying Sobrato’s Big Blue Bldg. and stuffing them all in it. Looks like the SJ City Hall anyway, and you can actually see it. 6)What’s the plan for the old city hall? Haven’t hear a thing though it’s an asset that could be utilized. I   hope you have Chuck’s ear on the issue of the City Hall. It’s a sociological archeological dig if there ever was one. George Green

  4. The money was spent, can we please stop whining about the cost?  Yes it cost a lot, but City Hall is actually a wonderful building, probably the finest architecture built in the last 10 years in Silicon Valley.  It a building we should be proud to own.

    What is Chuck’s plan for the Old City Hall, or the growing inventory of buildings that the city and RDA is allowing to rot away?  Some buildings even have code enforcement violations with graffiti and broken windows.

  5. Too bad that The Mercury would never publish Mr. Ruffo’s assessment of the project’s cost when we may have been able to do something about it. 
    Still, beyond the obvious expenditure, the part that really gets me are the misting polls.  I took a photo of the mist; truthfully, when you the mist is viewed at a distance, you’d think it was smoke.  But, beyond that, why did whoever designed that scupture think that this city needed mist?!
    Overall, this was just an expensive example of a done deal that wasn’t going to be stopped.

  6. Good reminder Pete.  However, the main thing will be if everyone has learned from this and in the future we do not have history repeat itself. 

    The city is now approaching the new year with a tremendous budget deficit looming—what will the people do now.  Everyone will have their priorities but the money won’t be there.  The pain will come in the decisions of which programs or needs will have to be put aside.  Then we’re going to see the reaction from the people.  The times are going to be rough for the new administration and how they handle the deficit will be their most difficult action to be faced. 

    Thank you R. Gonzales for putting the city in this financial position.

    Concerned Citizen

  7. Hey, Stop The Whining (#5):

    Whining about the costs will continue for another 30 years (the length of time it will take to pay off the bonds).  An average ofabout $25 million a year will have to be taken out of the budget to pay for the thing.  While the architecture is pleasing to the eye, how can you say it is a “wonderful building” if money was used to pay for it that could have otherwise been used to fund programs that help people?

    Pete Campbell

  8. #5, you fit the mold as a good example of “beauty is in the eyes of the beholder”. Your taste and mine are miles apart as I see this building as just another ugly box.
    The best suggestion made in comments prior to the building of the damm building was by a writer for the Mercury News. He suggested several centers around the city, connected electronically, that would serve the people where they lived. What an amazing concept.
    The reasoning that a new City Hall downtown would bring people downtown must have been concieved in the toilet while reading the MN. If one looks at other cities in the area, I challenge you to show me one government complex that brings people downtown. I include in this challenge the tourist site SF’s Golden Dome. At least it looks good.
    Supposedly, the new CH was going to save money by providing space for employees scattered all over the city.
    We all know how that turned out. Now what to do? My suggestion is to form a group to do the things advocated by #4. This group has to be non-partisen and probably populated by retired executives that understand how you save money. The politicals should stay out of this as they have already mucked it up.

  9. I’d say that the plan on the old city hall is to tear it down before it becomes clear that either the city needs more space – say for the Police Department who’s staff is cramed like sardines down the way on Mission St. Sell it to a housing developer for the price of the land to get some cash to help pay off the cost overruns of the new city hall. Then when it’s down, bond more money to build a new expansion building. Seems logical.

  10. Congratulations to Pete Campbell for creating a historical document that sets the record straight.  Conscientious people learn from the past to avoid repeating past mistakes—we long ago learned that refusal to learn from the past condemns us to relive it.

  11. During the time when Gonzales and the City Council I remember Chuck Reed suggested an alternative to the current City Hall:  the Sobrato Building on Almaden Blvd., next to the Convention Center.  City staff cited one of the main problems with Chuck Reed’s suggestion: “…it doesn’t have a rotunda.”
    This post serves as a reminder of how a project – regardless of the size and scope – should not be handled, and thank you Pete for bringing it up.  What’s done is done, and we cannot undo it (unfortunately for the various communities, programs, and citizens the $25 million a year would have helped).  The question is,  what have we learned from this, and how do we apply those lessons to all projects from here out, to prevent the mistakes of the past from happening in the future?  There is a quote – I think it was Cesear, but I am not sure – that goes like this:  “Those who do not know history are doomed to repeat it.”

  12. Come on Pete…

    It is a waste of time to complain about a project that occurred under the Gonzo administration.  History lesson learned; we voted Chuck in; we now have a fiscally conservative mayor, let’s talk about where we go from here to save money.

    Ideas like “Shop San Jose” will do nothing but burn more cash!  Most people can’t even tell you where city limit starts and stop, I mean really, isn’t shopping at Valley Fair shopping in San Jose?

    Cut the Grand Prix and dump the city’s unused buildings to help shore up the budget.  Consider using Stephen’s for jobs, not housing. 

    And let’s stop hanging banners for non-existent sports teams.

  13. #9

    The best suggestion made in comments prior to the building of the damm building was by a writer for the Mercury News. He suggested several centers around the city, connected electronically, that would serve the people where they lived. What an amazing concept.

    That was by Joe Rodriguez.  Personally, I think that out of all his columns and “ideas”, that is the one thing he has said that actually makes sense.  I wouldn’t mind if the city still implemented neighborhood offices, even with the new edifice built and being used.  Maybe a room in the new libraries would be a good location for remote offices. 

    As a side note, it is interesting that the Mercury now has him doing fluff stories.  I’m surprised that with the layoffs he is still writing for them.  Although he probably is a nice person, I just got tired of his constant “Its the white man’s fault people of color don’t succeed.” mantra.  He is just to negative and stuck in the past for my tastes.

  14. I had thought that before his criminal troubles began,  ex-major Gonzales had plans for his sycophantic friends on the city council to propose naming the city hall after him.  What a legacy that would have been.  Whew !!!

  15. Thanks for the reminder of how wasteful this project was.

    This report about the new San Jose City Hall is very timely. There can be no doubt that the money wasted on the “Taj Gonzales” could have been better spent meeting various needs around the city.

    Now comes a headline on the front page of the latest issue of the SJ Business Journal, “Grand vision for BART station.” http://sanjose.bizjournals.com/sanjose/stories/2007/01/22/story1.html

    The BART to SJ plan, as presently conceived, needs to be reviewed before it becomes the next generation’s “Taj Gonzales.”

    It’s noteworthy that there is lots of compelling analysis of the BART project at the “vtawatch” blog located at http://vtawatch.blogspot.com/ . Pay particular attention to this post:
    http://vtawatch.blogspot.com/2006/12/ron-gonzales-true-legacy-fubar-harming.html

    Many of the critics of the BART-to-SJ project are in fact advocates of better transit service. These advocates feel that the BART project, since it is unnecessarily expensive, will divert scarce transit money away from more worthy endeavors. The “(Santa Clara County, CA) VTA Riders Union has the following analysis on its web site:
    http://www.vtaridersunion.org/bartsjx/

    The Bay Rail Alliance has a much better and more cost effective alternative:
    http://bayrailalliance.org/southbayrailvision/

    It’s time that officialdom re-visits this expensive and poorly conceived project.

  16. #13 – No, Valley Fair is not the same as shopping in San Jose since many of the stores have Santa Clara addresses.  VF spans both cities.  You have to be careful about where you shop there if you want to maximinze your tax dollars in San Jose.  A “Shop San Jose” program has been suggested by many people as a way to remind folks they don’t need to leave town to buy things and if they truly want services (or to pay for City Hall), the revenues are sorely needed.  Every penny counts when we look at continuing budget deficit.

    What would be WONDERFUL and totally unlikely in this forum is if people started making positive suggestions about how to resolve the problems instead of just complaining or making idiotice suggestions like firing 20% of all management.  Seriously, you just want to remove them and, what, leave the existing issues still on the table with, perhaps, staff less qualified to figure out resolutions?

    The biggest problem San Jose has is the fact that it’s easier to sit back and complain about “what went wrong” instead of buckling down and coming up with some real goals and plans.  I didn’t see mass demonstrations organized by any of you when the new city hall was going through the process (and, for the record, I am not a fan of the design, placement or cost) so seriously, stop the crying over spilt expensive milk and start figuring out how to clean up the mess and move forward.  Quit the name calling, quit the crying, quit the whining and act like grown ups.  How are you going to fix it?

    CH was never meant to bring all employees together in the same building.  It has, however, brought departments that were previously scattered around the city in different buildings (Housing, RDA, PRNS etc.), saving thousands of hours each month wasted when people had to go to meetings at one department or another.  It has made processing permits, dealing with multiple agencies, paying bills, etc. much easier because services are all in one spot…and if you’ve trekked down there and wound up at the wrong department, you can travel up or down the elevator until you get to the right one.  While a dome might not be necessary, the rotunda was and continues to be essential.  Even though it is smaller than the last one, the floor adapts easily, allowing the use of multiple rooms.  And, the bottom line is, you can’t just say “I don’t like it” and get a refund on city hall, so now what?

    You’ve had years to complain, you’ve kicked out the people you’ve identified as bad guys. By the time elections are done this year you will have changed the administration and will be working with 4 new council members, so theoretically the remaining members you don’t like will be hamstrung…now what?  What are your suggestions?  What plans should be implemented?  I, for one, would welcome anything..any idea, any suggestion, any plan..that will bring the revenue in to support services (and the city hall debt is only part of the problem), revitalize neighborhood business districts, ensure a healthy and safe downtown, make sure our libraries, parks and rec centers are maintained, develop the trained and empowered staff to efficiently run the business of city hall and do so without destroying our existing neighborhoods.

    Anyone?

  17. #18, as I said in my former comment, the complete truth of the costs of city hall were never really exposed in The Mercury.  If they were, I suspect there would have been quite an uproar.  Mr. Ruffo did his utmost to stop the project.  Do you recall that?

  18. Pete,
    What you have posted for posterity, is something most if not all of us knew right along. The problem as I see it is that, the folks at city hall that complied and abetted with Gonzales, are still there in the shadows, waiting for the next project to work into.
        The Mayor would do well to thin the ranks of department heads and elevate those that remained true to the proccess of fair Goverment.
      Pete you’ve taken the first step, “NOW” follow the collusion.
      Now, “THAT” would be interesting reading, and smart Government!
                          D.O.A.

  19. #12. Jean: You are thinking of the philosopher poet George Santayna

    “Those who cannot remember the past are condemned to repeat it,” from Reason in Common Sense.

    Then again, Santayana also said “History is a pack of lies about events that never happened told by people who weren’t there. ”

    Take your pick.

  20. City Hall was a mistake—but who led the charge?

    The Mercury News, the downtown folks (it never should have left), the building trades (good jobs) and the City Hall bureaucrats.

    City Hall is not big enough for our ever-growing city government, so we have to lease elsewhere anyway. 

    25 years ago or so the Council remodeled the sixth floor of the Old City Hall, much to the consternation of voters.  Showers were put in—and caused all kinds of derisive remarks ensued.  If the showers were ever used, I don’t remember.

    But anytime elected officials and bureaucrats give themselves another perk, whether it is office space, a new car or as Chuck Reed found out “petty cash”, they better understand the public reaction to any misspending of those taxpayer dollars is going to have a negative effect.

    But hey, after getting rid of Cisco—how’s the technology holding up? 

    Instead of going with the local company that employs local residents and is also the industry leader and best vendor—we complain about the “process” and “corruption” and end up spending more for less quality.

    So some of the miscreants on this board can hold themselves responsible for increased costs and errors at the new City Hall.

    Democracy inaction.

  21. Richard

    Nice to heard from you even if you continue to use twisted logic and try to blame public for pointing out that former Mayor, Budget Director and City Manager in the back room manipulated the city procedures and got caught rather than do it in the open   Increased costs did not come about from public but from the 3 city officials responsible not doing waht they were expected and required to do

    – ” So some of the miscreants on this board can hold themselves responsible for increased costs and errors at the new City Hall.

    Yes it is – “Democracy in action”  to point out back room deals, questionable spending and   politician’s lapses in ethics or did you think this was Friday’s humor blog

  22. #24 needs to have the following warning label put at the beginning of any of his posts:

    WARNING:  Whiny, bitter, sore loser ticked off that the voters of San Jose actually care about process and open government and rejected “Subsidy Cindy” in a landslide is about to post nonsensical rubbish that blames the just installed administration for past misdeeds that occurred while a certain someone was vice-mayor.

  23. #18 /Whining doesn’t Fix Things,
      8 Years ago my running partner at the San Jose Athletic Club was the HR Director for the City of San Jose. When Gonzales became mayor Nona Tobin was sent to a non profit. This left him at the helm for the HR Dept. It would be very interesting to good government, as proposed by DOA, to have the Mayor office take a look into the hires of the last 8 years, that enabled San Jose to get into the mess we’re in. I can understand why so many folks want to get on with things. We may find a snake in the wood pile. Worth a look?
      A word of Black Smith wisdom. Never grab a horse shoe in any shop with out first knowing if it’s hot or cold. They all “look” alike.
      I like Joe’s East Side/West Side column and others. Most of the rest seems like just different ink every week.
      I looked forward to starting my day with a Merc on my stationary bike, when Jay and Chip were here. It was about our community. Inclusively?

                    The Village Black Smith

  24. #10, if I remember correctly, Al Ruffo, former San Jose Mayor, indicated that the old City Hall land could never be sold.  Apparently, the land was donated to the City with the proviso that, should public use ever be abandoned, the property would return to the heirs of the donor.  For that reason alone, the site was highly appropriate for the new City Hall.

  25. ANY civic project is going to be overly expensive by nature.  Look at Stanford Stadium.  Renovated in months, not years, and way cheaper and faster than any public university could accomplish the same thing.  This is just the way it works with public projects.

    The misters I believe are somehow integrated into the HVAC system at the new CH.  You don’t see them working except on days the A/C is likely being utilized inside the building.  The more I examine this building, the better I understand that it was well thought out by the architect down to the smallest detail and I have grown to appreciate it more and more over time. 

    Beauty is in the eye of the beholder for sure.  This is a daring and controversial building for San Jose but not for a more sophisticated large city.  It’s buildings like CH that help to diminish SJ’s reputation as a visual and social backwater. 

    For those who would have preferred a bad remodel job on 801 N. 1st, it’s time to grow up and realize you’re living in the nation’s 10th largest city, that it’s way past time we started looking like one and its citizens started embracing daring architectural projects be they public or private. 

    I’ve said it here before and I’ll say it again—you could never get a masterpiece like LA’s Disney Hall built in SJ.  Nope, only a non-descript concrete tilt-up design would match the image of SJ that all the naysayers want to project to the rest of the world.

    Geez, grow up, support exciting architecture and help this town amount to something!

  26. Nice job Pete!
    What I took a way from your statement is the need to make sure accountability in City Hall is upheld, so that we don’t get duped by stake holders again. I too am very concerned about Nancy, Nora, Forrest, and Judy. They worked very hard to get Chavez in as our new Mayor. They worked with Chavez and Gonzales in pushing a side the needs of citizens, and closed ranks on Council Members who went against labor, or developers. These four are tightly associated with Labor, and there for I see your concerns as very valid.
    Secondly, I so agree with department heads needing to be dethroned! Too many of them have their position only because they’ve out lasted their predecessor! Too many Chiefs and not enough Indians. I agree with John Michael.
    Many of these department heads work to keep their jobs by giving the illusion that we would be lost without their great wisdom. They send Council huge binders filled with inane information, in an effort to confuse, and dilute the real issue. A former Chief of Staff once told me that, “Staff’s real goal is to find ways to multiply.” I think it’s time the new Mayor considers a serious Spay/neuter Program on city staff department heads, as well as, moratorium on back yard breeders!

  27. Won’t term limits rid us of Forrest, Judy, Nancy and Nora?  I’m looking forward to replacing Judy, who did not receive my vote the first time she ran or when she ran for re-election.  She is useless and in bed with developers, as witnessed by the traffic-generating project she rubber stamped currently under way on Samaritan Drive.

  28. Pete,

    You bring up some great points.  The new City Hall is indicative of the way the City of San Jose has operated on so many decisions from the large, i.e. City Hall, to small RFPs that are awarded. 

    I am not for or against the new City Hall.  I am for a complete, open, and thorough process that factors all of the important elements of the decision making process.  Things like cost, cost savings, benefit to the City’s image, etc.

    If the City goes through the process and comes to decision, I am fine with the results.

Leave a Reply

Your email address will not be published. Required fields are marked *