Carrasco Broke Rules on Gifts, Barred from Voting on Taxis

Last September, several dozen Silicon Valley tech execs, nonprofit boosters and city of San Jose officials took a trip to New York City. The excursion was billed as a study mission for the San Jose Silicon Valley Chamber of Commerce, an effort to learn how the nation’s biggest city had revitalized areas like crack-infested Times Square to an M&M-infused candyland. The goal for this roving band of urbanists would be to learn the Big Apple’s secrets and apply those strategies to the South Bay.

In addition to touring the boroughs and taking meetings by day, the group spent three nights at the chic Millenium Hilton, which is “located right in the heart of New York City’s bustling financial district,” according to the hotel’s website. Evening highlights included tickets to the Broadway play “Love Letters,” starring Brian Dennehy and Mia Farrow, as well as taking in a Yankees game from an Oakland A’s-provided luxury box. On the last night of the trip, they watched future Hall of Famer Derek Jeter hit his last homerun in pinstripes.

But for one San Jose elected, the trip has proven to be a prickly endeavor—it constituted a violation of state law and will force her to sit on the sidelines for some of this year’s most important City Council votes.

Magdalena Carrasco admitted in a statement to San Jose Inside that she accepted an improper benefit by allowing the Chamber to pay for her $2,400 trip to New York. A council member-elect at the time, Carrasco consulted in advance with city attorney Rick Doyle to make sure her inclusion would not violate city rules. Since she had not taken office yet, Doyle reasoned, she would not be held to the same standards as recently termed-out Mayor Chuck Reed and Councilman Pete Constant, who both attended but had their expenses covered by city funds.

The trip would have been one of the last freebies Carrasco could receive before taking over as council member of San Jose’s District 5, except for one hitch. She was still a sitting school board member for the East Side Union High School District. Consequently, she was bound by the same gift restrictions—a $440 cap—as all other elected officials in California.

Carrasco said via a statement that in her “zealousness to ensure propriety at the city level, I failed to recognize that this was not allowed under East Side Union High School District policies.” She added that she “immediately contacted the Chamber to request an invoice then rectified the situation by reimbursing the chamber for my travel and expenses associated with the study mission.”

The last part of that statement appears to be a bit too neat. Derrick Seaver, the Chamber’s vice president of public policy, confirmed to San Jose Inside that his organization did not receive a check from Carrasco reimbursing the cost of the trip until mid-April—at least two months after she became aware that the trip constituted a violation and the same week James Rowen, a behind-the-scenes political operative, began sending email blasts to reporters and city staff.

As a result of her acceptance of the trip—covered almost entirely by Yellow Checker Cab, a sponsor of the Chamber’s study mission—Carrasco was forced to file a conflict of interest form in February that bars her for one year from voting on all matters related to taxi cabs and airport ground transportation. In a letter Doyle sent to Carrasco before the trip, he noted that she also might need to abstain from any votes connected to the Chamber.

Carrasco declined San Jose Inside's requests to elaborate on her statement, but through a review of two conflicting economic interest forms she filed, as well as nearly a dozen interviews with people who attended or have knowledge of the trip, two things have become clear:

First, the trip subverted the spirit and letter of state law, as Carrasco attempted to slip in a quick benefit before taking office; and second, the city of San Jose, in its reimbursement of costs to the Chamber, has created a way to subsidize entertainment. Thirteen city officials attended the trip at taxpayer expense, and one could argue that the included costs of Broadway shows and luxury suites at Major League Baseball games are a less than ideal use of funds when tight budgets persist.

Just exactly how, and why, Yellow Cab’s money was used to fund Carrasco’s trip remains unclear. The mission’s major sponsors included PG&E and the Oakland A’s.

“As I understand it, the contribution was made from Yellow Cab to the Chamber of Commerce, and for some reason the Chamber  applied it to the trip,” says Jerry Strangis, a lobbyist for Yellow Cab. Doyle, the city attorney, confirmed that account, saying, “I spoke with Yellow Cab’s attorney and they said money was just given to the Chamber.”

The timing of Carrasco’s knowledge of the sponsor complicates matters. In a Form 700 filing, also known as a statement of economic interest, Carrasco stated in a Feb. 2 report for her seat on the East Side school district that the Chamber and Yellow Cab paid $2,700 for the trip. But on March 6, Carrasco filed the same form for her new role as a San Jose council member and only listed the trip at $2,400. The form conspicuously omitted any mention of Yellow Cab as a sponsor.

In between those two reports, she admitted in a memo to the city attorney that she had a potential conflict of interest regarding an agenda item related to airport ground transportation—Yellow Cab is one of the biggest taxi cab operators in the city. The matter was dropped from a March agenda but is expected to return to the council in May.

Seaver could not say exactly why Yellow Cab’s sponsor money was used to pay for Carrasco’s trip, but he stressed that the Chamber's study missions have become an annual tradition and every effort is made to comply with city rules.

The person who brought attention to the issue, Rowen, said he is not working for anyone with a political vendetta against Carrasco and simply brought it up because he thought it “sounded weird that the Chamber of Commerce would give a gift to a non-city councilmember.” Seaver confirmed that the Chamber has no business going before the East Side school district.

Jay Wierenga, a spokesman for the Fair Political Practices Commission, the state’s government watchdog, confirmed with San Jose Inside that a review of Carrasco's actions is underway, which could lead to a formal investigation being launched.

Below is the full statement from Magdalena Carrasco and a list of all city employees who attended the trip:

“In September of 2014, I was part of an informational study mission to New York City that looked first hand at the issue of emergency preparedness, parks and economic revitalization where we learned about the best practices the city had taken to reinvigorate several public spaces while encouraging private & public investment.

“This Chamber sponsored trip attended by Mayor Reed, Council member Constant and several Silicon valley business and community leaders was an informative learning experience in how New York City successfully approached issues we are facing at home.

“I was not yet a city councilmember but spoke to City Attorney Rick Doyle as to whether such trip would be permissible under city policies. He assured me that several other city officials had attended Chamber study missions in the past and that doing so would be permissible. As such, the study mission was properly reported on my statement of economic interest filed with the California Fair Political Practices Commission.

“In my zealousness to ensure propriety at the city level, I failed to recognize that this was not allowed under East Side Union High School district policies. I immediately contacted the Chamber to request an invoice then rectified the situation by reimbursing the chamber for my travel and expenses associated with the study mission. 

“I apologize for the oversight but I want to reiterate that the overall study mission provided very good information for important issues we are facing in San Jose.”

NYC Attendees from the city of San Jose (Titles as of Sept. 16-19, 2014)

  1. Mayor Chuck Reed
  2. Councilmember Pete Constant
  3. Ed Shikada, City Manager
  4. Harry Freitas, PBCE Director
  5. Dave Sykes, Public Works Director
  6. Jacky Morales-Ferrand, Assistant Director of Housing
  7. Kim Becker Aguirre, Director of Aviation
  8. Jerad Ferguson, District 1 Chief of Staff
  9. Ken Willey, Senior Advisor of Public Safety, District 1
  10. Curtis Jacobson, Deputy Fire Chief, Bureau of Operational Support, SJFD
  11. Nanci Klein, Deputy Director of Economic Development
  12. Chris Burton, Sr. Business Development Manager/Assistant to the City Manager, Office of Economic Development
  13. Kathryn Sedwick, Plan Review Division Manager, PBCE

Josh Koehn is the managing editor for San Jose Inside and Metro Silicon Valley. Email tips to josh@metronews.com or follow him on Twitter at @Josh_Koehn.

31 Comments

  1. Magdalena Carrasco pays for her own trip and gets blasted yet all the others paid their trips with TAX PAYER (City of San Jose funds) MONEY and get a pass from Josh? So Surprising…..

    • You might have missed this part:

      “… and second, the city of San Jose, in its reimbursement of costs to the Chamber, has created a way to subsidize entertainment. Thirteen city officials attended the trip at taxpayer expense, and one could argue that the included costs of Broadway shows and luxury suites at Major League Baseball games are a less than ideal use of funds when tight budgets persist.”

      JK

      • Nicely blended into to the article so it goes unnoticed…..

        Your article also states that Magdalena has a conflict now. That is a false statement. Since the reimbursement took place the conflict does not exist (FPPC Rules). Am I wrong?

      • “Barred from Voting on Taxis” should be removed from title unless you’re ok with false statements?

        • SJI and their reporters are always ok with false statements. She’s doing a great job so far.

    • Very true, but we shouldn’t let Xavier’s actions lower our standard of conduct for elected officials.

      • Nor should we have allowed Mayor Reed to reimburse himself with taxpayer dollars from his D4 council office for personal expenses to the tune of $38k, then reimburse the taxpayers with “personal” (maybe even campaign money) AND THEN once accounts were settled to clarify rules to make it clear that what he did was UNETHICAL AND ILLEGAL….while we allowed him to march around as the self proclaimed Sunshine and transparency mayor. Reed was a crook!

  2. The Director of Aviation should have been left behind to guard the west side of the airport from intruders.

    David S. Wall

  3. > NYC Attendees from the city of San Jose

    Why couldn’t these people have just read a white paper or something, watched the baseball game on DirecTV, and waited for “Love Letters” to come out on DVD?

    According to President Obama, John Kerry, the Department of Defense, and the Pope, we’re all going to die from global warming.

    What is the carbon footprint for moving these thirteen carcasses to the east coast and back?

    If they absolutely HAD to send thirteen warm bodies to NYC, shouldn’t they at least have done an environmental impact report, and then a mitigation plan to make sure they sent minnows instead of whales?

  4. Just exactly how, and why, Yellow Cab’s money was used to fund Carrasco’s trip remains unclear. The mission’s major sponsors included PG&E and the Oakland A’s.

    “As I understand it, the contribution was made from Yellow Cab to the Chamber of Commerce, and for some reason the Chamber applied it to the trip,” says Jerry Strangis, a lobbyist for Yellow Cab. Doyle, the city attorney, confirmed that account, saying, “I spoke with Yellow Cab’s attorney and they said money was just given to the Chamber.”

    If the money given to the Chamber was commingled, then why indeed is Yellow Cab being singled out? I think Carrasco should abstain from voting on any issue involving any entity that contributed. That would include PG&E and the Oakland A’s too.

    • Sounds like if Carrasco has a conflict of interest then it is with th Chamber and not Yellow Cab.

  5. What is it about the voters that we consistently elect politicians who are so reluctant to pay their own way? That they run their own personal lives in such a shifty manner is unfortunate, but it is their own business and for them there will be a day of reckoning.
    Unfortunately though, they bring their low morals to the public’s business too. To these parasites mooching is a way of life and as public servants they are just as focused on groveling for freebies from the feds, from the state, from corporations. It never occurs to them that San Jose should pay for San Jose and that accepting favors and gifts leaves us weakened, compromised, and beholden.

  6. You need a complete Mexican Political system. Load the place up with Mexicans and let them run the show. Your 2/3 rds there anyway and integrity is long gone. Count to three fast, ok your Mayor too two gets you on the council and to one gets a Chiefs job. What’s nice about the trip to hell is that it’s down hill all the way. Welcome to Baltimore and I.m sure that poor blacl kid murdered himself???????

  7. The excursion was billed as a study mission for the San Jose Silicon Valley Chamber of Commerce, an effort to learn how the nation’s biggest city had revitalized areas like crack-infested Times Square to an M&M-infused candyland. The goal for this roving band of urbanists would be to learn the Big Apple’s secrets and apply those strategies to the South Bay………WASTE OF TAXPAYER MONEY…….SAN JOSE WILL NEVER BE A BIG CITY

  8. May The God of Israel bring righteous leaders to City Hall for many long years to come. When are these people going to stand up and represent the people of there district and lead a righteous lifestyle not for themself but for every one around them. Your position in working for the city is PUBLIC SERVICE not me myself and I, LETS get this straight people. You all in City HALL will REAP WHAT YOU SOW, you can’t hide from The Father of Creation. Have a good year San Jose.

  9. I have been researching the Vatican’s role in the conquest of the New World, by the Spanish and Portugese. The Vatican’s role in the Holocaust of the Jewish people. So what The Hell does God have to do with Magdalena?
    It is always the same old saw, the ugly denial, always comes out when there is no risk of being seen with out that mask on!
    I am ashamed of our resident nameless Knuckle Heads.

  10. Rick Doyle’s political expertise seems to greatly exceed his legal acumen. How he has remained SJ’s city attorney for so long, despite his oft-demonstrated lack of significant legal acumen, can best be explained by political prowess rather than legal ability. I am at a loss to understand why Ms. Carrasco sought legal counsel regarding her obligations as the holder of an office she had not yet assumed, while completely neglecting to seek legal advice regarding her obligations regarding the office she then held. Her presence as a school board member seems kinda scary when observed under that light. With Ms. Carrasco on the school board, no es una marvilla que Juanito no puede leer en Ingles. :( Why do you suppose it is, Rich, that so many corrupt and/or incompetent people get elected in that council district? Are they using Chicago, Harlem, or Louisiana as role models?

  11. Maybe that was part of the 60 million Dollars Chuck Reed was hiding…. Entertainment Fund, WOW! When programs are being cut, police and fire can’t recruit anyone because of the Tier 2 and increased pension costs. Employees’ retiring in the droves, why, it’s simple CUTS and MORE CUTS. People should be marching on City demanding answers. WOW! City Officials from the Airport all the way to City are parting while the people and employees’ and their families are continuously enduring hard ship’s. And this is O.K’s, it’s time for San Jose to stand up and demand better representation and accountability to all. Oh, I must’ve forgot , Accountability only applies to everyone under a manager’s position in San Jose.

  12. Maybe that was part of the 60 million Dollars Chuck Reed was hiding…. Entertainment Fund, WOW! When programs are being cut, police and fire can’t recruit anyone because of the Tier 2 and increased pension costs. Employees’ retiring in the droves, why, it’s simple CUTS and MORE CUTS. People should be marching on City Hall demanding answers. WOW! City Officials from the Airport all the way to City Hall are partying while the people and employees’ and their families are continuously enduring hard ship’s. And this is O.K’s, it’s time for San Jose to stand up and demand better representation and accountability to all. Oh, I must’ve forgot , Accountability only applies to everyone under a manager’s position in San Jose.

  13. “Just exactly how, and why, Yellow Cab’s money was used to fund Carrasco’s trip remains unclear. The mission’s major sponsors included PG&E and the Oakland A’s.

    “As I understand it, the contribution was made from Yellow Cab to the Chamber of Commerce, and for some reason the Chamber applied it to the trip,” says Jerry Strangis, a lobbyist for Yellow Cab. Doyle, the city attorney, confirmed that account, saying, “I spoke with Yellow Cab’s attorney and they said money was just given to the Chamber.””

    SO HOW AND WHY EXACTLY DID THAT HAPPEN?
    That seems to be the crucial point here.

    JK: Can you please elaborate on how that occur?