Indictment: Gonzales made 'secret and illegal agreement'

By Jason Bennert, Bay City News Service

June 23, 2006

SAN JOSE (BCN) - Santa Clara County prosecutors allege that San Jose Mayor Ron Gonzales received a bribe from Norcal Waste Systems, but the 19-page indictment naming the company, Gonzales and his chief aide Joe Guerra contains few details about the explosive charge.

Most of the indictment, approximately 15 pages, is devoted to detailing the circumstances behind the two counts of conspiracy with which Gonzales, Guerra and Norcal are charged.

A scant eight lines, with no details about how Gonzales allegedly received the bribe or how much it was, are devoted to the bribery charge against Gonzales.

The allegations contained in the two conspiracy charges largely mirror the contents of a 2005 Santa Clara County civil grand jury report that first brought the scandal to public attention. That report accused Gonzales of making a "backroom deal'' with Norcal that led to a 9 percent hike in city garbage rates in 2003.

Norcal received a total of $11.25 million in excess of its original contract proposal as a result of "a secret and illegal agreement between defendants Gonzales and Norcal,'' according to the indictment.

According to the indictment, Gonzales and Guerra met with Norcal officials on Oct. 6, 2000 to discuss a Norcal contract proposal to provide integrated waste services, garbage and recycling collection, in San Jose.

Some of the Norcal employees who would be working under the contract were represented at that time by the International Longshore and Warehouse Union.

At the meeting Gonzales allegedly requested that Norcal instead use employees represented by the Teamsters, who receive higher wages.

"When told by Norcal that using Teamsters would cost an estimated two million dollars more per year than originally proposed, and that Norcal would have to be made whole for this additional expense, Gonzales suggested that if Norcal made that happen, they would make Norcal whole,'' according to the indictment.

"This meeting was in furtherance of the conspiracy to cheat and defraud because from this conversation Norcal understood that Gonzales was offering to use his official position to persuade the city of San Jose to pay Norcal an additional estimated two million dollars per year beyond what Norcal's proposal called for, as a quid pro quo for Norcal'' using employees represented by the Teamsters in its San Jose operation.

The indictment lists a total of 25 overt acts that Gonzales, Guerra and/or Norcal allegedly took in furtherance of the two conspiracy charges.

In addition to the two charges of conspiracy -- one of "conspiracy to cheat and defraud'' and one of "conspiracy to commit a crime'' -- and the bribery charge, Gonzales is also charged with two counts of falsifying a public record in connection with two memorandums he submitted to the City Council on Dec. 8, 2000 and Sept. 16, 2004.

The indictment alleges that both memos contained false statements because they failed to mention his Dec. 6, 2000 meeting with Norcal officials and the alleged deal he offered them at the meeting. Gonzales is also charged with one count of misappropriating public monies in connection with the extra funds that went to Norcal above the original contract proposal.

Guerra is charged with the two conspiracy counts and the one count of misappropriating public monies.

Norcal is charged with the conspiracy counts, one count of bribery and the misappropriation count.

The indictment was handed down by the Santa Clara County civil grand jury, which does not normally issue criminal indictments.

The indictment lists 31 witnesses who were examined by the grand jury including Gonzales, Guerra and six current City Council members: Nora Campos, Vice Mayor Cindy Chavez, Judy Chirco, David Cortese, Linda Lezotte and Chuck Reed.

In addition, former City Councilwoman Pat Dando, now the president of the San Jose/Silicon Valley Chamber of Commerce, City Attorney Rick Doyle, former City Manager Del Borgsdorf and mayoral spokesman David Vossbrink were among those called before the grand jury.

Gonzales has said he broke no laws and has no plans to step down, despite calls for his resignation.

The district attorney's office has not made any comments on the indictment but will hold a news conference about the matter this afternoon.

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