Correction: An earlier version of this story described a single campaign contribution to Mayor Christina Fugazi. It has been updated to reflect that she received multiple contributions.
For days, Stockton City Council has been in turmoil after Vice Mayor Jason Lee claimed he had evidence that former interim City Manager Steve Colangelo improperly promised a social services nonprofit hundreds of thousands of dollars of city money.
As of today, key questions about this claim remain unanswered.
At the root of the recent tension are four documents Lee circulated among media last Wednesday, including city letter that shows Colangelo in June promised a Stockton nonprofit cash to bolster the group’s earlier application for millions in state behavioral health funding.
Generally, only council can approve city spending of $100,000 or more. Lee claimed the CEO of the nonprofit Service First of Northern California donated to Christina Fugazi’s mayoral campaign. Campaign finance records show the CEO and his development company made several contributions to Fugazi’s campaign.
Service First didn’t return a call seeking comment. Colangelo didn’t return an email seeking his response to the claims.
Lee’s circulation of the document sparked escalating conflict in the media between him and Fugazi, who said the letter wasn’t an official commitment of money and that she had returned one recent campaign donation.
But the conflict reached new heights Thursday — and roped in other councilmembers — when Lee couldn’t proceed with a special meeting to discuss Colangelo’s alleged misconduct because Fugazi and three councilmembers were absent, two of whom had voted in favor of holding the meeting just days before.
“I think there is a desired effort to prevent this conversation from happening,” Lee said after the meeting was canceled Thursday due to lack of a quorum, which is a voting majority. Only three of the council’s seven members attended.
“The only problem with that is, that I’m not going anywhere, and the issues aren’t going anywhere,” he said.
The councilmembers who did show up rescheduled the meeting for 6 p.m. Wednesday.
Until then, central questions about Lee’s claims remain unanswered, including whether anyone from the city promised the nonprofit money before it applied for the state funds; and whether the nonprofit ever actually received the money.
The $824,000
Among the records Lee circulated is a June 30 letter with city letterhead in which Colangelo says the city will provide funds for a Service First project.
“This letter serves as an official commitment from the City of Stockton confirming our intention to provide matching funds to support the Service First of Northern California Recovery Center project,” the document says.
Lee also shared a letter he said shows that California’s Department of Health Care Services tentatively awarded Service First $8.2 million May 6 to build a substance use recovery center in downtown Stockton.
According to Lee, the department’s letter said Service First had identified a cash “match” worth about $824,000 to support their project. Finding a cash match was a key condition of winning the funds.
Lee claims the cash Colangelo promised in his June letter was to go toward the $824,000 match.
Stocktonia authenticated the Colangelo letter with Stockton’s city clerk. The clerk hasn’t yet verified the three other records Lee circulated.
Open questions
The date on the award letter from DHCS predates the Colangelo letter by roughly two months — meaning Service First couldn’t have relied on Colangelo’s note for their original application for the money, which was due in December, according to a state announcement.
Instead, Service First would have had to provide an earlier letter of support or other piece of evidence showing someone — the city or otherwise — planned to provide the $824,000 match. Letters of support are a common requirement in funding applications.
It’s unclear who might’ve made that original pledge. A search of past City Council agendas showed the council hasn’t voted to approve providing the sum to Service First.
Tony Mannor, Stockton’s spokesperson, said he “(has) not identified any City Council authorization for matching funds.”
The director of Stockton’s Economic Development Department also didn’t return Stocktonia’s calls. Only City Council would’ve had the authority to provide funds of more than $100,000, according to Mannor.
DHCS didn’t answer a question about who Service First’s application said would provide the $824,000 match.
County money?
Lee also circulated an email dated May 31, which he says shows that Service First asked the Paul Canepa, chair of the San Joaquin County Board of Supervisors, if the county could cover part of the match.
“We couldn’t find any forms of funding for it,” Canepa told Stocktonia by phone Wednesday. The county didn’t provide Service First the match, county spokesperson Hilary Crowley confirmed.
It’s also unclear if the city ever actually gave Service First the match money. In comments after Thursday’s canceled meeting, Lee said he didn’t know if the money was ever paid out.
Finally, it’s unclear if Lee’s claims have impacted the state’s decision on whether to officially approve Service First’s $8.2 million award — a process that was still ongoing as of October, according to a state webpage about the funding.
Lee said he believed the state is aware of the claims.
‘We’re going to get the answers’
After three councilmembers didn’t show up to Thursday’s special meeting without prior notice, the above questions remain unanswered — for now.
City Council had voted 5-2 earlier this week to hold the meeting. Lee and Councilmembers Michael Blower, Mario Enríquez, Mariela Ponce and Michele Padilla voted “yes,” while Fugazi and Councilmember Brando Villapudua voted “no.” Fugazi said she had a prior commitment that conflicted with day and meeting time.
But Ponce, Padilla and Villapudua were also a no-show for the meeting without providing official notice to their colleagues, leaving their fellow councilmembers to wait on the dais until about 15 after the meeting’s start time before canceling the meeting. In a phone call after the meeting, Ponce said she didn’t attend because she was at work. Padilla and Villapudua didn’t respond to questions about their absences.
However, about 20 members of the public did show up, including several members of the San Joaquin County Grand Jury, according to grand juror Steve Beebe, who was in the audience.
People weren’t happy the meeting was canceled.
“It really shows a lot about who they are,” said Rena Rodgers, a member of Stockton’s Measure W Oversight Committee.
“This just shows they’re really not about the people,” said Yolanda Amen, president of the nonprofit Mata’irea Polynesian Culture Preservation.
“But I don’t think they know how strong we are, and this is just going to make (us) come out even harder now,” she said. “We’re going to get the answers we’re asking for.”
Stocktonia reporter Vincent Medina contributed to this story.