MediaNews editorial
Posted: 12/25/2010 09:00:00 PM PST
Updated: 12/27/2010 08:57:23 AM PST
THE LONG overdue cleanup of the fiscally and ethically challenged Hercules city government has begun. But the announcement last week of the imminent departure of the nepotistic city manager who pushed $3 million in no-bid contracts for a business headed by his young daughters will not be nearly enough to remove the stench from City Hall.
The Contra Costa district attorney, the county grand jury and the FBI need to carefully review the city's insider dealing under the tenure of outgoing City Manager Nelson Oliva, whom we hope will finally be out for good on Jan. 9. And the city must bring in financial experts to determine the full extent of Hercules fiscal woes.
As for leadership, City Attorney Mick Cabral, who publicly excused Oliva's behavior, must go next. And Mayor Ed Balico should submit his resignation immediately. If he doesn't, he should be recalled along with council members Joanne Ward and Don Kuehne, as we said about two weeks ago when we took the very unusual step of calling for removal of elected officials from office.
We wish we sensed that the City Council's termination of Oliva marked an ethical awakening by Balico, Ward and Kuehne; instead, we only see politically opportune bowing to public pressure in hopes that it will subside. Worse, when it comes to Balico, we continue to learn more about his attempts to leverage his political position for personal gain.
The entire episode has been an embarrassment for one of the fastest-growing cities in the East Bay, a community that holds great promise but has been hampered by leaders out for their own financial or political benefit.
For example, over the past three years, Oliva has recommended, and the council has approved, the no-bid service contracts for the firm he once owned, the firm for which two of his daughters until recently served as CEO and chief financial officer. The firm, in turn, instigated the awarding of questionable redevelopment agency loans to one of its own employees and to city workers, including Oliva's administrative assistant, who, a month later, was appointed to the board of directors of the Oliva family firm.
City Council members knew about the nepotism for more than a year, yet did nothing. As Election Day neared this year and public pressure mounted, Oliva went out on medical leave, and the council brought in an interim replacement, Charlie Long, a no-nonsense financial expert and former city manager. Long was to stay eight months and to start cleaning up the mess.
He moved quickly, slashing the city contract with the Oliva family firm and exposing the city's severe financial condition. Meanwhile, voters booted out two council members who were up for re-election this year. (The terms of Balico, Ward and Kuehne last until 2012.) Then, after Election Day but before new members were installed, the City Council abruptly fired Long and, amazingly, brought back Oliva.
The reasoning was ridiculous, but basically came down to claims that Long was moving too fast, acting on his own and making too much information public. In other words, he was embarrassing the council by candidly discussing the city's finances and trying to fix the problem.
Worse, Long later revealed in a letter to the council, Balico was complaining that publicity about the city's finances was hurting his ability to market his personal waste-to-energy business to other cities. It turns out that Balico had joined in that business with Oliva's mentor, former City Manager Mike Sakamoto.
Sakamoto was also under contract to the city of Hercules both directly and indirectly through the Oliva family firm. In other words, Balico, on the one hand, solicited Sakamoto to join the efforts of his personal waste-to-energy firm and, on the other hand, had approved contracts from which Sakamoto benefitted. The conflict was morally and ethically wrong; authorities must determine if it crossed a legal line.
As for Ward and Kuehne, there's no indication they have financially benefitted. But their support of the retention of Oliva for so long, their participation in the firing of Long and their public silence on the ethical breaches in City Hall indicate they were most concerned about their political futures, that they lack the moral leadership essential for public office. We keep looking for signs to the contrary and have yet to see them. The two either need to speak up now and convince the community that they have ethical backbones, or they need to go as well.
Hercules deserves leaders who will look out for the residents, not for themselves.
http://www.contracostatimes.com/opinion/ci_16937730?nclick_check=1
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