Times: Developer traveled widely on Hercules’ dime, with no project to show for it
— by Jeffrey Wisniewski — 1 January 2011 — 15 comments below »
Nothing like a PR disaster to start the year…
The developer of the planned Hercules New Town Center [Red Barn] has been earning $20,000 a month as a consultant to the city, not including travel and other expenses that often add $10,000 or more to his monthly tab.
With the project’s $12 million primary budget almost exhausted, and no construction to show for it except a temporary food court at Sycamore and San Pablo avenues, the expenses are coming under scrutiny in the wake of former Assistant City Manager Lisa Hammon’s Dec. 14 public resignation. At the time, she cited consultant costs among other factors contributing to Hercules’ financial troubles. [...]
The invoices appear to have been approved by the Finance Department with few adjustments, at least until November, when then-interim City Manager Charlie Long rejected a Red Barn invoice and informed Weigel that almost $11.2 million of the $12 million Primary Project Budget put up by the city had been depleted. On Dec. 7, the council terminated Long after Councilman and now Mayor Ed Balico complained that Long had been acting in general without council input and that his public disclosures of adverse financial news fueled negative perceptions of Hercules.
The developer was one of many that spoke at the orchestrated December 7 city council meeting that saw the short-lived return of Nelson Oliva as city manager.
Thanks for unearthing another story of continuing fiscal mismanagement involving our fair City and it’s poor leadership. Hoping in 2011 these type of headlines will diminish.
@ Susan Tarvin — I assume you are thanking Mr. Lochner’s relentless reporting and Ms. Hammon’s courage.
Jeff,
I think everyone is thanking Tom Lochner and Ms. Hammon for the obvious reasons. I was actually going to go to the City and ask under the FOI Act for copies of the invoices, but realized the Mr. Lochner would also do so and have a better chance of getting them than I. Why clog the system with requests when you have someone like Tom on your side?
What I am afraid of is that Oliva likely will be throwing Ms. Hammon and others under the bus when we see the signature that authorized payment of the invoices. Was Oliva stupid enough to sign his name to these invoices? I doubt it. I will not be at all be surprised if Oliva lays the blame on Ms. Hammon and claims total ignorance of the situation.
I once worked for someone who directed me to file false expense reports to be reimbursed for things he promised me but could not follow through on. I quit the job. 1994, 40 years old, a wife, 2 young kids, a house and no job. It actually turned out to be a good year. I am a better person for the experience. I know exactly how she feels right now.
Is this enough to get the AG involved? Kamala, are you reading this?
I sit corrected.
Mr. Lockner is my new hero and Ms. Hammon. You both have restored my faith in our precious systems of the press and govt service. The Belicos, MacDonalds, Valstadt, and the Olivas, Ward, and Don K., do not dictacte to the tax payer. If after reading the lastest news, and we do not demand a recall and the removal of the butt- ugly Market Place, and all the butt-ugly fenceing, and the butt-ugly corruption, then we really don’t care.
oops let us not forget one of the major players, city attn. Cabrel.
If this County stills has a D A. office or if it is not interupting the very busy schedule of the local board of supv., while their out dedicateing new parks and social justice , would you please demand a full investigation of the crooks in Hercules.
I am sickened by this – literally. And this is what Balico was defending? I hope the staff who processed these expenses is questioned by the DA. Were they approved under duress? What about the former head of Financial who is now demoted? It seems the more is uncovered the more there is to find. Mr. Lochner should get an award for his reporting. What began as a simple City Beat has turned into some very serious investigative reporting. He has continued (hope he’s reading!) despite being publicly insulted by the City Council repeatedly. As far as I’m concerned those insults reflect on the Council, not on the stellar job he is doing. Ms. Hammon is courageous and I admire her tremendously for the moral stand she has taken. The Recall process is beginning and I hope folks here will join us. I have committed myself to it. The revised first meeting is January 6th, 7 pm, Round Table. I will post info on the Recall as I get it.
Please help me out. There seems to be a lot of money going to this “temporary” commercial experiment and it appears the taxpayer is bearing all the risk and none of the benefits for this venture.
According to the CC Times, $20,000 a month goes to Weigel, plus all manner of expenses billed to the city, plus $10,000 a month to his attorney. All told nearly a half a million a year or so going to Weigel the consultant and his attorney.
But that’s not all, right? Isn’t there also an on sight Marketing Executive Director who is paid $10 or $20 K a month of city/redevelopment money? Is that true? And, I thought I saw a post stating that there is also an on sight leasing agent or assistandt director or some such who is paid another $10 grand a month? Is that true?
And is it true there is a family connection between Weigel and a Soriano or Serrano? It is something that is being rumored, and I don’t know if it is accurate information. Normally I would not entertain such a rumor, but given the history of insider dealing, cronyism and nepotism in Hercules, it wouldn’t surprise me. If anyone can provide some clarity on these points I would appreciate it.
Anything seems possible with the Oliva and Balico gang, they have no ethics and anything is fair game to them. Meanwhile, the Batara/Balico/Kuehne/Ward/Soriano chorus continues to call for patience, and warn us not to draw conclusions. All will be clear, in the end, we are told. Just trust them. They know what they are doing. Right???!?!?!
SK, I agree, Mr. Lochner deserves the highest praise and an award for his journalistic efforts. It is reprehensible that the old guard and their mouthpiece, Batara, continue to try and paint Lochner as the enemy.
With all due respect…to everyone posting here….I have to say that I agree with everyone….but we need numbers….not just all the same people posting what we see as correct…I keep looking and hoping for new names to pop up and say what they think…for more people to seem to be involved….is the word getting out properly ?…..I know its in the Times…but why are we not seeing more people on these forums? It worries me deeply….
SLR:
Historically there has been way too much apathy in Hercules, and that has allowed for this culture of corruption to spread without being checked.
However, I think most Herculeans are now generally aware of the issues, hence the overwhelming repudiation of the incumbents in every voting district of the city this past November. I don’t see why the recall would not produce a similar response at the voting booth from Herculeans.
I think most people are aware of the firing of Charlie Long and the re-hiring of Oliva. And I think that will prove to be the last straw for any citizen who cares about honest government.
At least I hope so. I tell as many people as I can what is going on. For the recall to get traction, all any voter needs to see is the reprinted articles from the CC Times and the Grand Jury report.
“We feel it’s (Market Hall) justified economically because for us it’s a research assignment,” said Tom Wiegel, president of Red Barn Co., “For what people look for, what they want to eat, the goods they want, how long they stay.”
After reading the above quote in the Hercules Patch, I wondered why the developer wasn’t too concerned about how badly Market Hall was performing. Now we know…. None of Red Barn’s money is on the line! Wiegel has no skin in this game. Wiegel is not acting as a developer, he is a consultant to the redevelopment agency; he collects a management fee for coming up with ideas and advising the Redevelopment Agency on how to build it – after RDA issues more bonds of course. The initial $12 million in bonds has already been spent on the temporary facility, plus Red Barn’s management fees and reimbursable expenses.
All the funding and risk for the New Town Center is by the Redevelopment Agency! This is just another sweetheart deal and the Hercules taxpayer gets the bill….
Hector:
It’s shocking. No wonder Wiegel was one of the first to be at the podium cheering the removal of Charlie Long and the reinstatement of Oliva.
We need 20 to get the Recall going! I hope folks here will attend!
John Troughton makes several great observations in an earlier post, follow the link if you have not read it:
http://www.waterfrontwatch.org/archives/2010/12/saltpeter-a-trial-of-nelson-oliva.html#comment-39632
Weigel has very large invoices for attending a conference in Las Vegas by the International Council of Shopping Centers (ICSC), which is THE place to present your project and sign up national retailers as tenants for your shopping center. Every retailer that you have heard of is there and they are looking for their next locations. Deals are made at ICSC!
Did Weigel and Red Barn have a booth at ICSC? Did he have his regional study available showing the population density, projected growth, demographics, household income, education levels, etc? Did he sign any tenants?
Many unanswered questions… Primarily, was he there to sell the project or just enjoy the parties on Hercules’ dime? Perhaps the DA can make him remember.
Where’s the beef? If you look at Market Hall’s website you will see that events were planned back in July through September 2010, with these events dwindling thereafter until there is almost NOTHING listed on the calendar for this past December and BLANK PAGES on the calendar for this month through the rest of the year. Other than a crafts fair there hasn’t been anything much scheduled to occur at this “city gathering place” for months. SAD.
See: http://www.herculesmarkethall.com
Appears the Market Hall marketers have given up, and are just collecting their checks. There hasn’t been a blog entry since July 14, 2010. Eight vendors are listed on the website, but only a couple remain.
It is a beautiful website, well done and paid for on the city’s dime as the invoices show, but there is NO CONTENT and NOTHING HAPPENING at Market Hall. Looks like good money was poured down the toilet. And the city is STILL paying $50,000 plus a month for this apparently failed experiment. Charlie Long was fired in part for raising questions about this.
Redevelopment projects entail risk, sometimes things work out and sometimes they don’t, but this “interim” scheme seems to have been poorly planned and executed, with NO RISK taken by the developer, as the city has had to foot the bill for EVERYTHING. Even the developer’s legal fees and tax consultant fees to figure out how to maximize his firm’s tax write offs. That should NOT be a cost transferred to the city. It is an inappropriate use of redevelopment money.
The developer needs to be weaned off city money NOW and put some skin in this. CIty needs to withdraw the subsidy and the project needs to stand or fail on its own merit. If Red Barn won’t put in the money to make it work, then get rid of Red Barn and find another developer who will. I’d rather have a vacant lot than continue paying $50,000 and more a month to Red Barn and a number of local Balico cronies who are on the “friends and family” plan.
I initially supported the Market Hall concept but once I learned how the city got duped into taking all the risk and paying for the developer’s extravagant travel expenses, and once I found out that Balico’s cronies were financially benefitting, I have soured on this project. It has become just another reason to support the recall effort.
Let’s not forget Long actually cancelled Red Barn and all its bleeding and Balico commented publicly at a Council meeting how outrageous that was! And he personally, and individually instructed Oliva and Cabral to reinstate Red Barn immediately! And they jumped to although it was never put to a Council vote! That particularly bleeding could have been stopped! And so it continues…………