Two members of the San Jose City Council are calling for an investigation into whether city funds were illegally used in local campaigns. Councilmembers Pete Constant and Johnny Khamis are asking the city manager and city attorney to “investigate whether any city funds that were provided to either Santa Clara Family Health Foundation or VMC Foundation were used to fund any campaign activities in any manner.”
“The Political Reform Act prohibits public financing of campaigns, except for elections in charter cities and counties,” notes the memorandum filed with the City Clerk’s office Thursday afternoon. “Additionally, Government Code Section 54964 prohibits an officer, employee or consultant of a local agency from expending or authorizing the expenditure of any local agency funds to support or oppose a ballot measure or a candidate.”
San Jose Inside reported on March 13 that VMC Foundation donated $289,000 and Santa Clara Family Health Foundation contributed $250,000 to the “Yes on A” campaign to raise county sales tax by 1/8 cent. Subsequently, the Yes on A committee gave $90,000 to the South Bay AFL-CIO Labor Council Issues Account and $10,000 to the Democratic Central Committee, two groups that were at the time working actively on behalf of candidates for office in addition to promoting the sales tax measure.
VMC Foundation Director Chris Wilder told San Jose Inside that the Measure A committee was headed by Santa Clara Family Health Foundation CEO Kathleen King, and that the other committee members were then-South Bay Labor Council chief executive Cindy Chavez and Cisco executive Sandra Wheatley Smerdon. Wilder said he was a volunteer but did not serve on the committee.
King confirmed that she headed the committee but declined to provide details about the health foundation’s board vote to fund the Measure A campaign. Chavez and California Assembly Speaker Pro Tempore Nora Campos serve as trustees of SCFHF.
Reached at her office this afternoon, King said she could not remember who was on the “Yes on A” committee that she chaired. “All my notes are at home,” she explained.
The council memo calls for more transparency and instructs the city manager and city attorney to “immediately report to the Rules & Open Government Committee if either the Santa Clara Family Health Foundation or VMC Foundation refuses to provide the city information needed to make the above determinations.” The memo, which notes that the city has given more than $6 million to the nonprofit foundations over the last three years, must still be approved by the city’s Rules and Open Government Committee and the City Council to take effect.
In addition to the San Jose, Cupertino, Los Altos, Milpitas, Mountain View and Sunnyvale and the County of Santa Clara provided funds to SCFHF. Other funders include The David & Lucile Packard Foundation, El Camino Hospital, FIRST 5 Santa Clara County, The Health Trust, Kaiser Permanente and Rotary Club of San Jose.
“A recent newspaper report brought to light information documenting that funds from the Santa Clara Family Health Foundation and VMC Foundation made their way to campaign activities (phone banks and mail campaigns) of the South Bay Labor Council in 2012, by using Measure A’s campaign committee as an intermediary,” the Constant/Khamis memo states, referring to the San Jose Inside report that also appeared in the Metro Silicon Valley Newspaper.
“While the SBLC clearly has a right to fund campaign activities and volunteers, it’s impossible at this juncture to sort out which measures or candidates may have benefited from the volunteers’ political activities that may or may not have been funded with taxpayer dollars,” Constant and Khamis write.
“In response to media inquires, both organizations have refused to provide any information to verify whether or not public funds have been used to support political activities or who participated in decisions.”
The VMC Foundation raises donations to support Santa Clara Valley Medical Center and the Santa Clara Valley Health & Hospital System. The Santa Clara Family Health Foundation raises funds to support the Healthy Kids program and the Children’s Health Initiative in Santa Clara County “to help achieve the goal of providing every child in Santa Clara County with access to quality health care through insurance.”
Click here to read Pete Constant and Johnny Khamis’ nonprofit investigation memo.