South Bay Labor Council Accepted Gambling Money While Funding Candidates

A paper trail suggests that money from Bay 101, the San Jose card club, made its way to the campaign of City Council candidate Xavier Campos. Public records show that following the card club’s $50,000 contribution in support of a ballot measure, funds were transferred to Campos-aligned organizations that subsequently funded Campos’ bitter battle for a District 5 council seat, in apparent violation of city campaign laws.

Mayor Chuck Reed, incoming District Attorney Jeff Rosen and other local elected officials say the series of so-called “independent expenditures,” including a $3,994 contribution from the South Bay Labor Council to the Campos campaign, looks suspicious and may point to political corruption.

The money in question changed hands several times. Records at the city, county and state show that in late April, Bay 101 contributed $557,905 to the Committee to Help Preserve San Jose City Services, the group behind Measure K. That ballot measure, which passed on June 8, allowed San Jose card clubs to expand in exchange for increased taxes earmarked for city services.

The half-million-dollar contribution and others from Bay 101 essentially funded the entire campaign.

On May 5, the Measure K committee gave $50,000 to the South Bay AFL-CIO Labor Council’s Committee on Political Education.

Throughout April and May, that committee made numerous donations to candidates for city council and the state assembly. These included $3,994.15 to Xavier Campos, who is running to replace his sister, Nora Campos, on the San Jose City Council. The SBLC committee also spent $11,082.47 in independent expenditures against Xavier Campos’ opponent, Magdalena Carrasco.

If the money from the card room in fact was diverted into the Campos campaign, that would violate a San Jose ordinance designed to keep money from the city’s gaming establishments out of local elections. Ordinance 12.06.260 states that a card room “may not make any contribution to candidates or candidate-controlled committees.”
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  1. You seem to have nothing but innuendo. Can someone point out a real story here or is the Metro content with doing anything they can to help their endorsed candidate in District 5?

  2. It was reported by the Mercury News that Mayor Reed raised funds for the Measure K campaign, including a $10,000 contribution from both Garden City Card Club and Bay 101. He even hired Vic Ajilouny, his political consultant, and Dawn Wright, his former chief of staff, to run the campaign. Hard to say the card clubs funded the whole campaign when Chuck and his city hall staff were out there raising money.

      • That was a completely different issue when Chuck Reed solicited $20,000 from card clubs to fund his campaign. That was about passing new taxes. And their contribution to that campaign had nothing to do with Chuck’s change of heart to now support an expansion of gambling in San Jose.

        Thanks for clarifying, Dawn.

  3. If you want to find the source of corruption, follow the money.  That’s what we learned from Watergate. Hope the current DA reads this and remembers the lesson.

  4. San Jose has long had a reputation for clean politics.  It changed when Labor began to raise big bucks from developers in 2006 for the ethically challenged Cindy Chavez who as mayor would have opened up Coyote Valley.  Chuck Reed got it right in your story.  Bay 101 is just playing the sleazy game that developers have being playing with Labor for a long time.  This is a new story but it’s also an old story. Congrats on uncovering it.

  5. Lotta facts here.  Lotta serious allegations too.  Interesting that the principal actors except for Ed McGovern aren’t talking about how this sh—goes down.

    Whats it gonna take for Carr to investigate?  A signed confession.

  6. I suspect you meant insinuation instead of innuendo in your criticism of this story.  Despite the fact that you used the wrong word, you’re also missing the story.  It’s not about a particular council race.  It’s about a larger pattern of corruption.

    If you read more carefully (and accurately) you’ll notice that the money trail is laid out clearly in this story.  Further, the Mayor, DA-elect, and a Councilmember clearly state that they believe a full investigation is warranted.  You also have political consultant essentially describe how he used the South Bay Labor Council to launder political contributions.

    It’s more than just curious.

  7. This story is a nice Politics 101 explanation of the way money flows in the American electoral system. What makes the story silly is the insinuation that there’s something illegal going on.

    This is our political fund-raising system functioning as it was deliberately designed. What is disingenuous about it is the way the writer and the political figures she quotes tut-tut in mock astonishment. Their real anger is that anyone disagreeing with them still gets to play by their rules.

    • What Jody ignores or doesn’t know is that SJ prohibits gambling establishments to contribute to SJ city candidates.  It’s illegal.

      Developers can legally contribute but when Jody’s organization helps them hide their contributions, it’s dishonest.

      • Hey Rule Checker,

        Jody is an Labor apparatchik.  She’s defending her operation.  She can’t do her job and have ethical standards, personal judgement, or real integrity.

    • This story exists because the South Bay AFL-CIO Labor Council’s Committee on Political Education (COPE) files public reports detailing the contributions it receives and the expenditures it makes. The reports are required by law so that the public knows where COPE and all the many Political Action Committees (PACs) get their money and where they spend it. These are the records that the story refers to as its source; although by not describing their purpose, a reader may get the impression that a secret has been uncovered.

      COPE wants the public to know what it is doing, too. It represents the political interests of tens of thousands of working people who hold it accountable. A reader might, however, get the impression from this story that there is something sinister about working people who join together in their own self-interest instead of the constitutionally protected right that it is.

      There is nothing secret or illegal about this activity. Neither is there anything secret or illegal about gambling establishments contributing to PACs. A reader might get that impression, however, because the story discusses COPE’s activities in a vacuum, as if they are unique.

      “I fly airplanes,” the pilot admitted. “We sell groceries,” the supermarket manager bragged. PACs raise money to spend on political campaigns.

      My employer is just as clear in my signature above as COPE’s political work. I do my work proudly without apology. I am a male, and “Go Easy on Jody’s” comments about my ethics, judgment and integrity are as accurate as his or her assumption about my gender.

      • Mr. Meacham,

        Two posts and you still have not addressed the issue raised in the article:  Did COPE contribute money from a card room to a candidate for San Jose city council or candidate-controlled committee?  Please answer yes or no.  Thank you.

      • The story says Measure K not Bay 101 gave the money to your organization.  Why didn’t the card club do it directly if there was no effort to deceive?

        Also, when did Bay 101 fall in love with labor interests to the tune of $50,000?  Aren’t they run by Republicans?

        Please don’t respond with blather about the concerns of working people.

    • I haven’t dodged your question, “Steve0.” It is answered in the story. Bay 101 contributed money to Measure K. Measure K contributed some of its money to COPE and also – and this was not mentioned in the story – to other PACs and the Republican and Democratic parties as well. All of the recipients of Measure K money pooled those funds with their other contributions and then spent that money in support of the candidates and issues they favored.

      This is the way PACs raise and spend money. It is the way the laws that created PACs intend for them to raise and spend money. And PACs are one of the ways that candidates for Mayor and San Jose City Council receive campaign contributions. The city ordinance cited in the story that card rooms “may not make any contribution to candidates or candidate-controlled committees” was not violated by Measure K’s contribution to COPE or COPE’s contributions to candidates.

      The problem with this story is that it creates the impression that labor unions are using illegal means to participate in elections, and the reason it creates this impression is because the politicians who designed this fundraising process wish to reserve its financial clout only for themselves.

      The working people who have organized themselves to further their own interests in the American political process – whose interests are considered by some as “blather” – will not allow themselves to be painted as villains by hypocritical political opponents or deprived of the same political rights that all Americans enjoy. This story attempts to do both of those things.

      Your question, “88 Downtowner,” about why Measure K or any donor chooses to contribute to COPE should be addressed to the donor. COPE’s endorsements are publicized both on the Labor Council’s website at and by the candidates and causes who ask for and receive them.

  8. “The scary thing is that SBLC-bought politicians are about as dim as a small appliance lightbulb.”

    You have your metaphor mixed up.  The correct phrase is “about as BRIGHT as a small appliance lightbulb.”  That implies they are not very smart.

    I will cut you some slack on this, but based on many of your other posts I could say you are not the brightest bulb in the chandelier.

    • Abigail,

      After stating you “will” cut G Howe some slack you went ahead and insulted him. Since you seem to be grading homework here, think about giving yourself an F.

  9. Sounds like Shades of Team San Jose… City funds for private uses.  No accounting for the use of public funds. I think “two buck Chuck” has some crooked hand in this. 

    Are you sure Used Car Salesman Dan Fenton doesn’t have his greedy little hand in this?  And I do mean “little” have you seen how short this guy is… 

    He really over compensated with those stupid “Giant Shoulder Padded Double Breasted Blazers and his Elevator Shoes, reminiscent of Maxwell Smart Agent 86 from the old TV show Get Smart.

    Except Maxwell Smart was not Corrupt.

  10. “Ordinance 12.06.260 states that a card room “may not make any contribution to candidates or candidate-controlled committees.”

    If challenged, that ordinance would not likely pass Constitutional muster.

    • Given the recent ruling in Citizens United, you are absolutely right. As a matter of fact, Citizens United could be applied by a lower correct to this exact case.