By refusing to disclose the nature of a $60,000 a year consulting agreement with a local construction trades union at the Aug.13 Santa Clara Unified School District Board of Trustee meeting, discussion surrounding Trustee Christopher Stampolis alleged income conflict halted all discussion of Project Labor Agreements (PLAs) for the district construction projects.
PLAs are pre-hire agreements with labor organizations setting union-scale wage rates and benefits, and collecting union dues from all employees working on a specific project, contractors and subcontractors alike. Compliance is monitored by union representatives as well as the employer. In return, unions agree not to strike or otherwise disrupt work.
District officials requested a legal opinion on Stampolis’ possible conflict of interest after a July 1, 2015 WEEKLY story detailed Stampolis’ $5,000/month consulting relationship for an organizing group belonging to the Laborers International Union of North America (LIUNA). The conflict of interest report, as well as the PLA discussion, was on the agenda for Aug. 13 and available about a week before the meeting.
With Stampolis refusing to make the legally-required disclosure, the board voted to get a judicial ruling – “judicial injunction” – on whether Stampolis’ financial interest as a union consultant constituted a conflict of interest; taking all PLA discussion and action off the table until more information is available.
Answering Everything But the Question
That vote didn’t happen before more than an hour of discussion. Stampolis began by saying, “I think I can clear this up pretty quick,” he was “quite confident” he could “continue to participate in the discussion.” He denied that he would receive tangible benefit from a PLA or that he had any “disqualifying interest,” and stated that he was the most qualified person on the board to discuss PLAs.
Stampolis accused long-time public law specialist and district legal consultant Sherman Wong of lying – “Mr. Wong, you are a liar, this guy’s a liar” – as well as incompetence, having a personal agenda of bilking the district, personal “hostility” to himself because of Stampolis’ advocacy, and putting “adherence to the law below his own political beliefs.” Stampolis accused Superintendent Stanley Rose of conspiring with Wong, and told one board colleague, Trustee Michele Ryan, that if she had a problem with proceeding with the PLA discussion – Ryan endorsed following Wong’s recommendation – she could “solve it. Leave, Dr. Ryan.”
Stampolis disputed legal interpretation, requested a step-by-step description of the process of obtaining a judicial injunction, challenged the conduct of the meeting as being contrary to the latest version of Roberts Rules and insisted it was unreasonable to expect him to be prepared to discuss his employment contract. “I still have not had a question posed to me that I can answer.”
Wong said Stampolis did everything except answer the question about his financial interest.
As the discussion continued, Wong reiterated the need for Stampolis to disclose the nature of his work. Stampolis gestured at staff and board colleagues, refusing to relinquish the floor to other speakers. When Board President Albert Gonzalez brought down the gavel and called a recess, Stampolis continued speaking.
“This is an embarrassment,” he said, and urged the audience, “you should all be [demonstrating] outside the door and demanding the resignation of Stanley Rose. He’s an embarrassment to himself and an embarrassment to the district and the people in this room. He knew this was going to happen.”
“The issue is we had all these people here tonight, we had an attorney come up here tonight,” he continued, “in coordination with someone sitting over there. He got a 16 percent raise and he doesn’t care about the little people here. He wanted his 16 percent. It’s all about making the wealthy wealthier and not respecting the blue collar workers.”
When Gonzalez asked him to stop attacking Rose, Stampolis responded, “It’s not an attack. It’s reality. Politics are politics. We’re talking about wealthy men who deliberately disrespect people coming in tonight knowing that there wasn’t going to be an opportunity for them to speak … Knowing that, he kept his mouth shut for the explicit purpose of disrespecting people … That is not the kind of man who should be employed by a public agency.”
After about 10 minutes of conversation with SCPD officers, Stampolis left the boardroom briefly. After Peterson Principal Susan Harris received a permanent restraining order against Stampolis last year, two police officers have been present at all SCUSD board meetings – at district expense.
Despite Smokescreen, $5,000 Monthly Retainer Remains Central Question
Since the summer before his election in 2012, Stampolis has received $5,000/month for consulting from The Laborersâ€™ Pacific Southwest Regional Organizing Coalition (LPSROC) because he receives a salary/fee, and has received a salary/fee since June 2012, of $5,000 per month for government and community relations consulting services, according to U.S. Dept. of Labor records (www.dol.gov/olms). Stampolis didn’t file FPPC-required financial disclosures for 2013 and 2014 until April 2015, after receiving two late notices and being fined by Santa Clara County.
The Regional Organizing Coalition is part of LIUNA, its Pacific Southwest Region and The Southern California District Council of Laborers and affiliated Local Unions. Its stated purpose, according to the organization’s website, “is to increase our market share by organizing more contractors to become signatory,” and “to raise our market share and footprint in the industries in which we represent.”
Any district PLA would include several construction trades unions; some of which are members of LIUNA, its Regional Organizing Coalition, Pacific Southwest Region and the Council of Laborers and Affiliated Unions.
“It is our conclusion,” said Wong, “that the consultant relationship between Mr. Stampolis and the labor organizing entity constitutes a conflict of interest … that requires Mr. Stampolis … to make public disclosure, at a meeting, of the nature, scope, and details of his financial relationship and recuse himself from participating in a any discussion or attempting to influence board member on any matter that pertains to the entity under the umbrella of the organization from which Mr. Stampolis has received compensation for the last couple of years.”
Without Stampolis proving otherwise by disclosing his employment obligations, there was “a strong suspicion that someone doesn’t get paid $60,000 to bake cookies, given the mission of the [Regional Organizing Coalition] organization,” Wong said.
If Stampolis didn’t comply with the disclosure requirement, Wong explained, and the board went ahead with its plan that night to discuss a PLA, take public commentary, and hear presentations from advocacy groups both for and against, it would put the district in legal jeopardy.
The district would open itself to litigation charging that its construction contracts were tainted by a conflict of interest, and those contracts could be voided – something that could derail the district’s construction schedule for everything from urgently needed maintenance to building new schools to accommodate the district’s burgeoning enrollment. “This uncertainty … hangs over our heads with Mr. Stampolis present,” Wong said.
California Government Code is clear on conflicts of interest (sections 1090 and 87100) and prohibits public officials, employees and agency boards from having any direct or indirect financial interest in any contract made by the bodies they’re members of. If interests are “remote,” individuals can continue to serve but must disclose the nature of their financial interest at a public meeting, recuse themselves from deliberations and votes on the matter, and refrain from attempts to influence other board members.
If “prohibited interest” is found, the people with the conflict of interest can be subject to civil penalties and, if the violation was “willful,” prison time and being barred from ever holding public office. The law also states that contracts affected by it are void. For this reason, Wong advised the SCUSD board that they would be placing the district in legal jeopardy if any discussion of PLAs were allowed without Stampolis’ disclosure and recusal.
By his own admission at the Aug. 13 SCUSD board meeting, Stampolis was employed by the union during the time he served on the West Valley Mission Community College District board; and participated in that board’s vote in Nov. 2012 to enter into a PLA for Measure C bond construction projects. Stampolis voted against the motion. He did not disclose his financial interests on the public record at the time, although he stated on Aug. 13 this was “widely known.”
Obtaining a judicial opinion on Stampolis’ alleged conflict of interest could add tens of thousands to the legal bills the district has already incurred as a result of Stampolis’ litigation against the district, legal questions and litigation arising from his conduct.