The Norcal Scandal’s namesake, the waste disposal company at the center of the controversy, has largely been left out of the discussion lately while the mayor’s part in the deal has taken center stage. However, we shouldn’t lose sight of the fact that Norcal will have to answer the very serious charges made by the grand jury in court in due course, unless their past history with a similar incident guides us to a different conclusion.
In 2000, Norcal Waste Systems paid $6.561 million to San Bernardino County as part of a settlement in response to a lawsuit filed by the county alleging that a county official had been bribed by a Norcal vice president and consultant in order to win a no-bid contract. The company admitted no wrongdoing, but the two employees pleaded guilty to federal bribery charges. The company placed sole blame on the “two bad apples” and further agreed to pay the county half the net proceeds from any damages the company recovered from the employees and also agreed not to seek a new county contract for five years.
If Norcal finds itself able to strike a similar deal with the DA here, where will that leave the mayor? Wouldn’t that pretty much implicate Gonzales in some way and make it difficult or impossible for him to be exonerated? It seems to me that this is a real possibility, given that companies usually operate on the basis of what will cost them the least in the long run.
And then there is the little matter of the $11.25 million paid to the company by the city as a result of the alleged “deal” that is at the heart of the indictment. It looks as though the city council might demand repayment of those funds and institute a civil suit to recover the money if necessary. Under the circumstances, the council would be right to make this move. Furthermore, when the company’s contract with the city expires next year, it should not be renewed and Norcal should not be invited to rebid in the future.
Great column by Scott Herhold, a little perspective on the “bribe”.
http://www.mercurynews.com/mld/mercurynews/news/columnists/scott_herhold/14976602.htm
RE: Herhold’s column and #2. He neglects to mention that the law has changed since the Garza days. Bribery no longer means that it only benefits an individual. I’m sure Rich could enlighten us on this if he would present it factually and not colored with his bias.
The workers of Norcal are not responsible. But the leaders of the company who gave Ron a great deal and took that 11 million and gave part of it to several other local politicians. Should we list the ones who got Norcal money?
It’s said that art imitates life.
Re: Norcal, two words quickly come to mind:
“The Sopranos”
The comedy never stops in the Robinson zone.
Gentle Reader, it’s (now) about social justice stupid.
RG is a modern day Cesar Chavez, Rosa Parks, and Robin Hood all rolled into a 1000 dollar suit.
We should really be celebrating this theft of public money because the end always justifies the means when it comes to social justice.
And who among us could bear to live with the image of the self-loathing standing next to their Norcal recycling receptacle empty bottle in hand and a tear in their eye?
Dear DA Kennedy,
You have done the county well. Dont mess this one up now. Gonzales has contempt for justice; thus, no plea deal. Also, turn up the pressure and bankrupt him.
the City of San Jose
Gee, does that mean any local politician that took Norcal money should explain why he did?
Anyone who can’t smell the stench or recognize the toxic threat in the Norcal deal needs a refresher course in corruption. The possibility that no dirty cash made its way to the mayor’s pocket should comfort no one. In fact, to realize that our mayor extends credit should raise the hairs on the back of your head.
However it is framed or spun, what Ron Gonzales did in his dealings with Norcal and the Teamsters had nothing to do with expediency, error, getting rich, or improving the lot of trash sorters. What it was about was the future. The mayor was trading in futures: his and the Teamsters.
Regarding Mr. Herhold’s column: Ron Gonzales is no Al Garza. Mr. Garza was a kind, likable guy who at some level realized that his Hispanic supporters had pretty much Pedro-principled him as far as he was likely to go. So he took the cash. It wasn’t much, except when viewed from the perspective of his life in the private sector and his future prospects. Ron Gonzales, on the other hand, is neither kind nor likable. His future, as he saw it, was breathtaking. As a smart, experienced, politically-savvy Hispanic politician in California, RG knew his potential was more valuable that a suitcase full of cash. So did the Teamsters.
There was business to be done.
As mayor, Ron Gonzales had little reason to court the Teamsters, but as a local performer with big show aspirations, he had lots of reasons to have them see him as a player—their player. So he did the one thing they want most from a politician: he gave them something they couldn’t otherwise get. You say it wasn’t much, just a few dozen new members and a few thousand a month in union dues? You’re right.
The issue wasn’t really about money, it was about executing a blood oath. If RG could do that under-the-table for them on a local garbage contract, just imagine what he might do at the state or federal level. It is from these dirty little deals that local unions find both sustenance and rising political stars.
To make a splash at the statewide level, Ron Gonzales needed to be seen as a guy who cuts through the red tape and “gets things done.” Though it may spin well to the public’s ear, getting things done is recognized by the vultures who circulate our legislative houses as the mark of a politician willing to entertain all offers.
Having done the job in the garbage deal and the police contract, RG was ready to ride in to Sacramento on a wagon with a Teamster at the reins, a cop riding shotgun, and Joe Guerra waving a “open for business” sign out the back.
Our mayor’s corruption is exactly the kind that is ruining our nation. It is the kind that put our state on the verge of bankruptcy; it is the kind that has put our entire congress in the pockets of lobbyists and led them to abandon the interests of the people. Or did you really buy that nonsense about Saddam threatening our shores? Or that the security of our borders was beyond our control? Or that we get a dime’s worth of value out of the billions we give Israel every year?
Scratch at any frightening national problem or inexplicable government commitment and you will sniff the stench of the worst kind of lobbyists—those who use their dollars and political clout to put into office politicians who will serve their interests, bring ruin to the country, and send the bill to the taxpayers.
We were all better-off back in Al Garza’s time, when bribery was a cash-only business.
Richard, Richard, Richard:
I agree that the Fairmont subsidy, the Convention Center, the big blue tent and the Grand Prix subsidy are improper uses of public funds and poorly thought out by those in power. However, like it or not, they were done by legally following the process. It is unfortunate the mayor and the city council have their heads screwed on backwards and use our money in this fashion. To condone the Norcal deal because of where the money ended up makes me wonder which way your head is screwed on (not a personal attack, just a metaphor). Your logic confuses me. Does that mean Ronny G and the city council can do anything they want illegally as long a “good cause” benefits in the end. The fact is, Ronny G and the city council CAN do whatever they want as long as they follow the process. In Norcal, that is what he failed to do, no matter who benefitted.
Richard #1
Private companies actually enjoy more rights currently than citizens, even though they are not accorded such by the Constitution, thanks to errant Supreme Court judgements of the past and an army of bought-and-paid-for politicians from the White House and Congress to the Statehouse and City Hall. Since you obviously operate in this arena, you know what I am talking about.
If Norcal was a city-owned operation, then I can understand that the city would be responsible for funding wage increases when necessary and I would support it. However, Norcal is a private company who signed a contract to provide services to the city for a specified length of time and at a specified price. They would (or should) have taken all contingencies into consideration when they signed the contract. They bear sole responsibility for wage increases that they are required to pay during the duration of that contract. An overpaid CEO might have to take a cut in pay and shareholders might get a smaller dividend, but that’s their problem, not the city’s.
It appears that what happened was that an unforeseen contingency raised its head, like a “proposal” to change unions, which required payment of wages above and beyond what was taken into consideration at the time the contract was signed (hence the “bribe” of the indictment). And isn’t that why we are where we are with this matter at present?
8 – Only if it was an illegal donation. Fix the system.
You can’t read the stories about the woes of San Jose Mayor Ron Gonzales and top aide Joe Guerra without pondering the oddities of San Jose’s political history.
– some things do not change at City Hall. Council members still bully the staff. They conduct important business in private. They often lie.
how true how true – if you only knew what went on and still goes on at city hall – but then SJI only wants labor and cindy out and chuck and chamber in – not real changes – and you wonder why public is turned off by all poliicial bullsh**
Ron was steering Norcal to the Teamsters. Norcal said “yes” if San Jose pays the difference. Ron wanted to be the guy that “gets things done” by lying to the Council and the good citizens of San Jose. That’s why Ron is in legal and political trouble…..
frustrated finfan – good comments – now how do we change city government ? – not elect 1 person but real lasting changes so San Jose does not – Get Gonzalesed – again by future ethically challenged politicians like Ron and Joe did to San Jose
learn from past and change or San Jose will – Get Gonzalesed – again
Rich #1,
If this is now a social justice issue, sounds like you would next want to see us do away with laws preventing gifts of public funds. The council could then sprinkle money around to help out companies with city contracts.
The workers at Green Team work just as hard as CWS workers. I am sure they would appreciate a raise.
I am sorry, but the fact that Norcal wanted to hand out the cold hard cash that it got from this deal with the city to corrupt other city council members in other communities just tells me that it is the tree that is rotten and not the process. For example, I would be proud to take a donation from Tom McEnery or from others like him. The idea of public funds being considered for political campaigns is silly. Why would we take money from a park program helping kids and give it to Chuck Reed? Disclosure is the key to all political campaigns, and so why don’t the politicians who took the Norcal money fess up?
#1 R.R.
If it was about getting the recycle workers $3.00 more per hour why did they have to change to teamsters?
#4 James
Yes I would like to see a list of what city politicians received money from Norcal and the Teamsters. I would also like to see who got money from the Longshoreman, though I think the list is short.
#14 Bottom Line
Those are the facts, but were others involved?
Rich-
Since we’re citing articles the Biz Journal has a good one this week about Gonzo’s ties to the Teamsters. It also offers perspective on the bribe.
Unlike Herhold’s column, the BJ article gets into the history leading to the charge.
http://sanjose.bizjournals.com/sanjose/stories/2006/07/03/story3.html
# 14: where are the feds on this clear violation of the National Labor Relations Board laws and regulations?
Just in from KCBS:
Teamsters Defends San Jose Garbage Contract
San Jose, Calif. (KCBS) —The Teamsters Union in the South Bay is defending the garbage contract that led to the indictment of San Jose Mayor Ron Gonzales on six criminal counts and cost the city more than $11 million.
According to the indictment, Mayor Gonzales, his chief aide Joe Guerra and Norcal Waste Systems made an illegal deal guaranteeing that a Norcal subcontractor on the San Jose contract would hire workers represented by the Teamsters, instead of the Longshoremen’s union, and pay higher wages as a result.
KCBS’ Mike Colgan reported that at a Thursday news conference some of the key players in San Jose’s Norcal garbage scandal attempted to “set the record straight’’ about the labor contract that led to last month’s indictment of Mayor Ron Gonzales.
Teamster’s Local boss Robert Morales adamantly disputed the claim the contract was achieved as a result of a backroom deal involving the mayor.
“How can I be in a secret deal when I went and testified before the entire city council and we lobby everybody and we talk to every staff member…I can not concede a secret deal when you talk to everybody who will listen to you,” he said.
But Chuck Reed who’s in the San Jose mayoral runoff with Cindy Chavez said the fundamental question hasn’t changed.
“I think the central, unanswered question in this entire fiasco is why was it so important to give the Teamsters the contract. Why did the mayor step into a dispute between the Teamsters Union and the Longshoreman’s Union. We don’t know the answer to that question yet,” Reed said. “We’ll probably have to wait until the transcript is released from the grand jury hearing.”
Mayor Gonzales continues to maintain he has done nothing wrong and plans to plead not guilty at a court hearing later this month.
The City Council passed a resolution following his indictment asking him to step down, but he refused.
His next scheduled court appearance is July 26.
Copyright 2006, KCBS. All Rights Reserved.
I’m sure a Republican Justice Department would love to fry a Democratic Mayor in one of the bluest states in the country. Ronzo is going to have to get his dancing shoes on!!
On 6/8/99, the City Council unanimously approved Resolution 68900, specifying Living Wage requirements for employers doing business with the City.
The vote was:
Ayes: Chavez, PAT DANDO, Diaz, Diquisto, Fiscalini, LINDA LeZOTTE, Matthews, Powers, Shirakawa, Woody, Gonazles.
Noes: NONE
Read it here: < http://www.sanjoseca.gov/purchasing/TextOnly/livgwag1.htm >
Effective date was 11/17/98.
In 1998, the Living Wage was set at $9.50/hr if medical benefits were employer-provided; otherwise $10.75/hr.
Annual reviews provided for % increases if the SF-Oakland-SJ urban area CPI (Consumer Price Inflation) rate increased by at least 1%.
As of 7/1/05, the Living Wage was $12.86 if a medical benefit was not provided by the employer.
< http://www.sanjoseca.gov/purchasing/lvdeterm.htm >
If I recall, the Norcal contract amendment was approved 8-3 last November. If the City Council can’t read their agenda packets, they should have voted ‘no.’ If they voted yes and now complain, it sounds like they are playing CYA games.
The Norcal contract amendment is mostly about paying people an honest wage.
Some perspective:
San Jose’s annual budget for 2006-7 is about $2.6 Bn.
The Norcal-CWS contract increase was $11.25 Mn over 5 years, or $2.25 Mn/yr.
That is 0.08 % of the city’s annual budget.
A Interesting Comparison:
The Norcal contract amendment costs homeowners approximately $1.00 more each month.
Total garbage and recycling fees are $18.50 per month for basic service.
In comparison, the City of Los Angeles, with 10 times the population of San Jose,
currently charges its residents $11 per month –
a rate which has been massively subsidized with money from LA’s Dept of Water and Power (under a policy dating to Sam Yorty.)
The new 2007 LA City budget calls for a 2007 trash service fee increase of 155%, or $7 per month
—- to a total of $18 per month beginning in July. (About what residents in San Jose pay.)
However, future increases will bring the monthly trash fee in LA to $22 in 2007, $26 in 2008 and
finally $28 in 2009.
< http://www.latimes.com/news/local/la-me-trash13apr13,1,5340581 >
San Jose residents have a very good deal. They just don’t realize how good. Wait until the next contract is signed.
Jack, Jack, Jack,
NorCal is not an individual—it is a Corporation.
When Mission City Garbage in Santa Clara was convicted of racketeering and price skimming, they simply removed their management team.
The workers, who had no part in the skimming kept their jobs and the Santa Clara City Council continued to contract with them on a 4-3 vote.
The point everybody is missing is that the $11 million did not go to line an individual’s pocket, it went to pay garbage workers a wage of about $15 an hour—as opposed to $12 an hour.
For people at that wage level, $3 an hour is a considerable sum—even after taxes.
That in a nutshell is what the DA is claiming is “the bribe”, a $3 an hour pay raise for the least among us.
That was your “gift of public funds and the essence of the bribe charge”.
You’d think if the Mayor was going to sell his office, he’d get a hell of a lot more. And if it was a gift, it was one of the most humane gifts ever made by a public entity.
Now the subsidy to the Fairmont, was that a gift of public funds? How about the Convention Center or that big blue tent? The Grand Prix, possibly?
Each of these “gifts” also has a public purpose, though none so noble as paying hard working people on the lower end of the wage scale.
NorCal may be the elephant in the room, but it is a white elephant.
#23 Done Some Research
I always love some new facts. Thank you.
Would you do a little more research and check to see if the $11.25 million that was given away to Norcal and the Teamsters equals 30% of San Jose’s budget deficit. Would you also do some research to see if living wage applys to offsite workers. Would you then find out how much of the $11,ooo,ooo of our money went into the pockets of the union bosses. Then do some research and find out if any candidates got money from the Teamsters or Norcal. Finally would you do some research to find out how many starving children $11,250,000 would feed or how many homeless people it could provide a roof over their head. This way we will be able to know what Ron cheated the citizens of San Jose out of, by not giving them a voice in how their hard earned money was spent. After you do this research we will really have this scandal in proper perspective.
Thanks for your hard work in helping us find the truth.
#23
So are you saying that it is ok to steal a little from a lot of people, but it is not ok to steal a lot of money from a few? In my book stealing is stealing, lying is lying. I don’t want the leaders of my city doing either.
So you say we got a good deal on our garbage contract. Do you think if the shoe were on the other foot, Norcal would be coming back to us saying they want to give us our money back? You need to expand your research.
I thought all of Cindy’s fans were saying the money should go to the workers not Norcal?
Norcal was the one who made the deal with the city not the teamsters. If Norcal used Teamsters to begin with would you still be saying we should have payed Norcal more?
If we don’t honor our contracts, what is the point in writing them in the first place?
I have been accused of just focusing on Santa Clara issues, but on Monday, I will post if San Jose candidates for Mayor, or if any other local politician in a city that does business with a Norcal company received money from Norcal from 2001 to 2006, IF AND ONLY IF, MORE THAN ONE BLOGGER IS INTNERESTED.
The question is for November 2006, Mercury News, Buisness Journal, San Jose Inisde, Metro, will you support people for election or reelection who took campaign contributions from Norcal after the Gonzales deal was struck in 2001?
23 – This is all very interesting but it is not relevant to this issue. The garbage contract stipulates that prevailing wage applies only to work done on publicly owned property: the city streets. The only garbage workers covered by prevailing wage are: garbage drivers; recycle drivers; yard trimming claw drivers; yard trimming collection drivers; and residential street sweepers.
In today’s Merc there is an article[1] about the Teamster press conference yestereday. From the article:
“Morales said the Teamsters’ only role in the contract, starting in fall 2000, was to “lobby everybody’’—including city council members, their staff, and city environmental services officials—to argue against a pay cut for the workers.”
We know what the mayor did when confronted with this problem. The teamsters confirmed that everybody else on the council knew about the problem. The key question is what did the other council members do about the problem?
On the surface we see they did nothing. Why not? Did they know like everybody else in city hall that Ron and Joe had it handled? I hope these questions were asked in the grand jury inquiry while our council members were under oath.
[1] http://www.mercurynews.com/mld/mercurynews/news/special_packages/norcal/14985595.htm
DA Kennedy,
Your mission: NO Gonzales Plea Deal.
Gonzales not above the law: indicted, tried, convicted and bankrupted.
The City of San Jose
Dear Research (#23):
The public’s business needs to be conducted in public. The wage policy of the City has, for the most part, been a matter of public record.
The trash deal proposed by Gonzales raised rates under the pretense that it was a necessary increase due to unforseen economic circumstances. The truth of the matter is that Gonzo and his “City Manager” lied to the Council on the Norcal deal.
Gonzo’s motivations for keeping the details about the Norcal secret will ultimately become public. I expect that the results will show that Gonzo was in it for himself and not the public.
Ron and Joe’s actions in this are clearly an abuse of the implied imperial authority they exercised. They should be prosecuted within the law and made to answer for their improper use of the bully pulpit. (Remember, that is all it is for when the final issue was “resolved” they had to bring along enough Council votes to complete the transaction.)
Norcal had “won” a contract on terms that were unacceptable to the political will of the City, but their bid was not improper. They were instructed by the apparent leader of the City to accept the contract with an amendment, to change the applicable union in order to not displace workers already on the job. If given this option, I would imagine that Norcal felt empowered to act based upon the commitment the Mayor made to neutralize the financial change. Norcal wanted the work and made a good faith effort to fulfill its bid agreement. Though they didn’t run to the press and state that they were acting in secret, nor were they obliged to by any laws I know about. It wasn’t a state secret who was handling the garbage. If the bid stated Longshoreman and Teamsters were on the job, several in power could have figured that out if they felt it mattered. But they didn’t. The work was getting done.
Norcal may have been corporately naive, but I don’t see their actions as criminal or abusive. The Mayor’s office gave them leave to alter the implementation to the benefit of local workers on a revenue neutral basis. I don’t see them as the culprits here. Nor should they now be the victims. Let them bid under the conditions they now operate under and if they can still beat all comers why should we penalize ourselves by paying more just to show up Norcal.
The ethical challenge was solely in the Mayors office. The fact that Norcal was a part of it is asking the bidder to “out” the Mayor after winning a big bid. Who would do that?
Stay on topic, Ron and Joe abused their position and deceived the Council for years. What is complicated about this issue?
#32 Stay on Point
The question we are all asking ourselves, is this just the tip of the iceberg or is this all there is? Those who feel cheated and lied to want a pound of flesh. Those who feel that the Gonsalez-Chavez years have been good to them just want this mess to just go away.
Many citizens feel pain and mistrust towards the mayor and some council members who didn’t stand up to Ron until it recently became the popular thing to do. When you catch an other person lying to you, the first things you ask yourself, is this the first time they have lied to me or has this been going on for a long time? Citizens want to know what else Ron did that was unethical. Was it Cisco, the grand prix, the ballpark or was it something we don’t yet know about. They also want to know who was behind all of this. Did Cindy, his longtime friend and past labor council employee play any role in putting the deal together? We have to understand that they don’t want to be fooled again. They also want to know what Norcal and the Teamsters had to gain in all of this.
There are also those who feel that Ron is being treated unfairly. They themselves may have been victims of racial discrimination. The recent circus at the last council meeting I’m sure only reinforces their fears. There is also a chance that the only thing Cindy is guilty of is failing to stand up to the mayor when he was abusing his power.
We somehow need to check under every rock for wrong doing, yet not rush to judgement. That is what makes this whole thing complicated.
Dear Novice #6, all you’ve said is true and correct. However, it’s time to ignore RR. To acknowledge his “contributions” to this board is not warranted. But then I assume readers of this board are intelligent. I may be giving them too much credit. Maybe you’re right…
Rowen,
Please post the contribution information if you have it
The name that NOBODY is talking about is California Waste Solutions. I wonder how much their management is profiting from this payment? CWS has had issues in Oakland before and it looks like they have brought those problems to San Jose.
CWS is in bed with several of the Councilmembers. Gee, I wonder who the new garbage contracts will go to??
37 – You are so right. Not only that, but a former Deputy City Manager was also involved in CWS issues in another city (it may have been Oakland.) This thing continue to stink like the rotting garbage it is.
Jim # 28: I’m interested.
Stay on Point #32: R U on Norcal’s payroll?
1: Hooray!! Finally someone else who appreciates the fact that the SJ City Council wants to pay people a fair(er) wage for what has been great service.
Terry Roberts was the Public Works Director in Oakland (subsequently San Jose Deputy City Manager in charge of the new City Hall) when the CWS issue blew up there. Here’s a web link to an article which is briefly excerpted below.
http://www.zmag.org/zmag/zarticle.cfm?Url=articles/dec98bacon.htm
Fraud In Oakland’s Garbage Sweatshop
By David Bacon
When 70 workers walked out of a west Oakland recycling facility August 21, they simply wanted a raise. But the increasingly bitter East Bay strike uncovered, not just abusive working conditions and poverty wages, but de facto municipal sanction of a garbage-sorting sweatshop, operated for years in violation of its own city contract.
As the strike ground on, investigation revealed that workers were cheated on wages for years, while city councilmembers received thousands of dollars in campaign contributions. To make matters worse, David Duong, owner of the struck California Waste Solutions, hired strikebreakers and attempted to resume operations, while city officials made excuses or turned away in a city where labor boasts of its political clout.
Finally, after five weeks, the strike was resolved when workers were able to embarrass outgoing Mayor Elihu Harris and other city councilmembers into intervening to put pressure on Duong. But the conflict left unresolved the question of why, in a city which has just adopted a living wage ordinance, a similar contract provision could go unenforced and unmonitored for seven years.