metrosantacruz.com
News, music, movies, events & restaurants in Santa Cruz, California from Metro Santa Cruz weekly

News and Features
09.12.07

home | metro silicon valley index | features | silicon valley | feature story



Photograph by Felipe Buitrago
The wide open spaces near Gilroy could soon be full of houses if Gillmor's group gets its plans approved.

The Quiet Hand of Gary Gillmor

Local land baron Gary Gillmor and his family play power politics with big bucks in Santa Clara and Gilroy.

By Vrinda Normand


GARY GILLMOR saunters over to the reception desk at his Santa Clara office wearing jogging pants and a gray T-shirt—not exactly what one would expect to see on a wealthy land baron and former mayor of Santa Clara. But then, that's probably the reaction Gillmor is going for as he prepares to be questioned. The 6-foot-1, 71-year-old tries to downplay his larger-than-life reputation throughout our entire interview.

"Oh yeah, they exaggerated things, but that's fine," he says about the steady stream of public criticism that swirls around him and his politically active family. "It doesn't bother me,"Gillmor slouches in the conference room chair, averts his eyes and hurriedly recites the timeline of his life as if there's nothing in it that should interest a reporter. In a brash tone, he admits that he's been married four times and that his current wife, Sandra, is a "beautiful young lady" of 45 years."It sounds corny but Santa Clara gave me my break," he continues. Gillmor came as a poor young man on a basketball scholarship to Santa Clara University.

He made a name for himself in the athletic world and lives on in the school's hall of fame. Then he got elected to the Santa Clara City Council in 1965, when he was just 29 years old. Four years later, he became the city's first elected mayor, an office he held until 1977. "So now I'm just a layperson," he concludes.But of course, that's not the end of the story. Gillmor may have left office 30 years ago, but he stayed close to the action.

In the late 1970s, he started a modest real estate business that he now runs with his daughter, Lisa Gillmor, who served two terms on the Santa Clara City Council in the 1990s.

Gillmor says that he has sold over a billion dollars of public property for 60 school districts and public agencies around the state of California. He has used his political knowledge and experience to attract many of his clients, who pay him a commission only if he gets local governments to approve zoning for their projects. He has done this as a consultant and land-lease agent for two of Santa Clara's biggest developments in the past 15 years. And his biggest financial success may be yet to come from his stakes near the booming South County city of Gilroy.

Although he has been successful for more than 90 percent of his clients, Gillmor assures us that his business relationships are spotless and have nothing to do with the generous campaign contributions he and his entire family have bestowed to certain Santa Clara politicians for decades. All of the insinuations about him pulling strings at City Hall to benefit his clients or personal bank account—that's nothing but the gossip of a small clutch of relentless critics, he says.

He still tries to understate the significance of his political influence as a businessman. "If you ask any councilmember, when was the last time I appeared before them, they can't remember," Gillmor tells me. "I have not lobbied; I have never been a paid consultant. I haven't done anything."

After all, his political contributions are no secret. Public records show that nine members of the Gillmor family and four of their direct employees and investment partners have given more than $20,000 to Santa Clara candidates in just the past five years. Gary Gillmor says he has been writing checks to public campaigns since the early 1980s.

"Did I speak my mind?" he points out. "Yes. If knowledge is power then we're power brokers. I mean, we know about the city."

Then he presented me with a challenge I couldn't refuse: "Try to find something, I dare you."

So I launched an investigation to get to the bottom of the sensational speculation. Just how much do the Gillmors matter in local politics, and are they really exploiting the system to expand their empire?

The clan's assets, connections and ambitions were a package to put under the microscope. I scoured campaign finance statements in two cities looking for the Gillmor children, in-laws, employees and investment partners. I sifted through more than 20 years of Santa Clara City Council meeting minutes. I dug up historical archives, planning documents, court records, real estate holdings and uncovered correspondence between Gary Gillmor and city leaders years after he left office.

I also spoke with people who have known the Gillmors for more than a decade. The feedback painted two entirely different pictures: "All I know is, Gary's always been a real compassionate guy to me. When he helped me out, he never asked for anything in return," says Chuck Blair, a unsuccessful candidate for a seat on the Santa Clara City Council in 2004. Now he works for Gillmor's real estate business.

"Gary's not a guy who's just out for himself. He's out for the well-being of his clients," says a source who has been close to the family for at least 20 years but asked that he not be named because of his professional relationship with Gillmor.

On the other hand, I heard from people who openly criticized the Gillmors and their alleged self-serving meanderings in the political scene.

"There are just too many coincidences," says John McLemore, former Santa Clara City Council member. "How much closer can you get to being in the control of the system?"

"I feel there is a family trying to protect their own personal interest, and that bothers me," adds Karen Hardy, an unsuccessful council candidate who sued the Gillmors in small-claims court for violating campaign finance rules.

Family Affair

So you see, I wasn't sure who to believe, and after weeks of digging, I think it's safe to conclude that the truth is about as gray as the hair on Gary Gillmor's head. As far as I can tell, there is no smoking gun that suggests Gillmor or his family members have done anything significantly unethical or illegal.

However, the Gillmor story is full of intriguing, if not suspiciously serendipitous, connections that speak to the power of political friendships, experience and good-old-fashioned democratic support. It is a classic story of how persistence and cultivation of influence pays out economic rewards.

Here are a few examples of when public entities and private profit intersected amid the Gillmor influence sphere:

— Gillmor's best friend was the late Jim Joseph, developer and founder of Interland. With Gillmor's help as a paid consultant, Joseph won the bid to build luxury apartment complexes on 41 acres of Santa Clara's old Fairway Glen Golf Course in the early 1990s. Council meeting minutes from 1988 show Gillmor appearing in front of city leaders on behalf of his friend and client.

— Gillmor profited as the land-lease agent for the West Valley–Mission Community College District, which leased its surplus land across the street from Great America to Interland's Joseph in the mid-'90s. The result was the Mercado cinema and shopping complex, which Gillmor helped push along at several city council meetings in 1989.

— Gillmor found his real estate niche with school districts when he hooked up with Santa Clara Unified in the late 1970s. As its real estate agent, he sold more than $32 million of surplus land for the district from 1979 to 1985. He spoke on its behalf at City Council in 1991 and represented other clients at meetings under the branch of his business called "Public Property Advisors."

— The Gillmor family owns 10,000 square feet of Santa Clara's downtown Franklin Square, which includes their real estate office. In an unusual setup, the city owns the property surrounding the footprint of the mall's modest one-story buildings. That means taxpayers footed the bill for a $3 million renovation of the square in 2001. (Former Councilmember Lisa Gillmor voted five times on the project before she abstained due to her obvious conflict of interest.) The city also pays the lion's share of maintenance costs for the building grounds and adjacent parking lot—$129,000 last year, while the 12 different owners pitched in a total of $11,000.

— Gary and Lisa Gillmor are advocates for building a professional football stadium near Great America. They disagree with critics who say their support is motivated by the boost in property values a sports complex could bring. Gary Gillmor owns three office buildings on De La Cruz Boulevard. Lisa and her siblings own a supermarket on Lawrence Expressway worth more than $3 million, in addition to two apartment buildings on Lewis and Monroe Streets. All properties are about five miles away from the proposed stadium site.

— Gary Gillmor owns, in part, the Morse Mansion, otherwise known as the grandest historical house in Santa Clara. He and his investment partners have been trying to sell it for the past year at $3 million. So far, no acceptable offers have been made, although Gillmor says he would prefer to sell it to the city for the sake of historical preservation. As luck would have it, the council is considering the purchase as one of its top 15 priorities for the next two years.

— While it is widely discussed, few know about Gillmor's interest in Gilroy. He owns over 2,000 acres in partnership with all of his children and nearly 200 other investors. As the group's general partner since 1969, Gillmor has been spearheading a vision to build multimillion-dollar estate homes on one of the most pristine cattle ranches left in the county. But first he must get the city and the county to approve a massive annexation that would increase the land area of Gilroy by 20 percent.

Urbanite Dreams

The stifling 90-degree-plus weather and smoggy haze that's settled over south Santa Clara County this August afternoon barely detracts from the breathtaking beauty of the Uvas Valley. Just northwest of Gilroy and wedged between the Gavilan and Coastal ranges, the untouched land evokes the countryside peace that harried Silicon Valley refugees appreciate.

From the view on top of a nearby bluff, a few dozen cattle appear as dots on dry grassland, divided by a sparkling blue strip of water—the Uvas River. Environmental activists such as solar-energy developer Chris Cote would fight to preserve this rich land, from the rare animal species that call it home to the archeological remains of the last humans that ever lived on it: the coastal Ohlone Indians.

Cote's vision for the land would be to preserve all of it as a national park. "But that's never going to happen," he says grimly. "There's too much political power behind it for it not to happen."

Gary Gillmor happens to be a key player in the effort to introduce humans to this area once again. His group's 2,100 acres span the valley's hills and flatland and snake into an agricultural region on the southern tip of the adjacent Santa Clara Valley.

According to applications he submitted to Gilroy last month, Gillmor wants to build estate homes on 248 acres, covering most of the prime flat land that's currently used for cattle grazing. The rest of the green, hilly land would be preserved as open space with a 30-acre site for a public facility (possibly a school and a fire station).

Gillmor says the plans are still being developed as he talks with city staff to create a "balanced community." "We don't just want to pave the land with asphalt," he says. Well, a good chunk of it could be turned over to bulldozers for an extremely lucrative project. Cote says 500 homes could fit on 248 acres and bring in at least $1.3 million each, well north of a half-billion dollars in product.

But Gillmor's vision certainly won't happen overnight. First, he needs to amend Gilroy's general plan to annex his 2,100 acres into the city's boundaries, a process that may take a couple of years. Then Gilroy city leaders must have the annexation approved by the county's Local Agency Formation Commission (LAFCO), a small governing body that denied a previous attempt to annex only part of Gillmor's ranchland.

In 1997, Gillmor struck a deal with Gilroy city leaders, who wanted to put an 18-hole golf course on his property (even though Gilroy is already home to two nine-hole courses and surrounded by 11 other courses in nearby cities). They saw enough importance in the idea to stretch county growth policies and agree to Gillmor's conditions:

The ranch partnership would sell 218 acres to the city at "bargain" price of $3.1 million if the city approved pre-zoning for a tony residential development on the periphery of the golf course.

A letter from Gillmor's attorney, William Gates, sent in July of 1997, reminded city leaders that the "gift" was valued at $10 million. "In return, my client has asked only that he be treated by the City in the same manner as any other applicant for land development would be treated."

A month later, the pre-zoning was approved, despite flaws in the EIR pointed out by then-LAFCO director Autumn Arias. She also wrote to city officials in July 1997, warning them that the project was inconsistent with county policies and that the EIR contained "underlying inaccuracies."

LAFCO soon after rejected the annexation request to prevent premature urban sprawl—Gilroy still had over 20 years' worth of vacant residentially zoned property within its boundaries. Gillmor consequently rescinded the charitable land-transfer agreement in 1998.

In the past 10 years, however, Gilroy has become the second-fastest-growing city in the county, and Gillmor thinks things will turn out differently this time. "We were there before most of the people in Gilroy were there," he says. "And now it's our turn. The city has grown to our boundaries."

DESCRIPTION

Photograph by Felipe Buitrago
Gary and Lisa Gillmor make a formidable team in Santa Clara politics.

Secret Contributions

Gilroy planning director William Faus gave me tight-lipped replies when I asked him about the proposed ranch development and whether or not conditions in the city had changed over the past 10 years. Had Gilroy really grown to its boundaries? Was the city ready to take in 2,100 acres?

"That's the big question," Faus said. He would only tell me that the city will be "paying handsomely" for an environmental consultant to find some answers. He wouldn't say anything about the ranch plans, which came to light only after a review of city files that included a 4-foot-long map drawn up by the Gillmor group.

Gillmor says he has contributed money to Gilroy elected officials over the years along with his family members. A review, however, of contribution filings for Gilroy City Council members going back to 1995 reveals no Gillmors. The documents raise questions, however.

In the past 12 years, 17 candidates for Gilroy City Council have received more than $188,000 in cash during election years from unnamed sources—representing 55 percent of their total monetary contributions. If they were all following campaign finance rules, none of these contributions would have been more than $99 each.

That's a very different state of affairs than in other parts of Santa Clara County, where most candidates receive the vast majority of their contributions in check form and must record the name of each donor to promote transparency.

Gary Gillmor's name was also absent from any campaign statements associated with LAFCO commissioners who also hold elected offices: County Supervisors Don Gage and Blanca Alvarado, San Jose Councilmember Pete Constant and Sunnyvale Councilmember John Howe. But Gillmor's wife, children, in-laws and partners seem to be avid supporters of the only Republican county supervisor; since 1997, at least 13 of them have contributed in excess of $11,000 to Gage's campaign accounts.

Gage was the only LAFCO member who voted in favor of the 1997 attempt to annex Gillmor's ranch.

Gage staffer John Gibbs confirms that Gary Gillmor has come to the supervisor's office several times to discuss the project. "He's had different proposals for that land over the years," Gibbs says, "But those talks have been very general in nature."

In the Public Eye

Lisa Gillmor greets me wearing minimal makeup, an understated black knit top and gray slacks. The 47-year-old real estate agent begins our interview with a nervous chuckle: "Well, it must be important, so here we go."

Not that she hasn't been grilled by journalists before—she served on the Santa Clara City Council from 1992 to 2000 and before that sat on the city's Parks and Recreation Commission for 10 years, right after graduating from the University of Southern California.

"I didn't really think there was a choice; it was just something that you did," she says about jumping into public service at such a young age. After all, her father got elected to the City Council when she was only 5 years old, shortly before her mother passed away. Then she went through high school as the mayor's daughter.

"I knew that part of our life was public," Gillmor says.

"I'll never forget one time he left town, and I decided to have a party at our house," she remembers with a wry grin. "And when he came back from his trip to Washington, D.C., the chief of police called him and said, 'You know what your daughter did this weekend? She had a party at your house."

She got grounded for that teenage infraction, but Gillmor would later go on to encourage youth participation in city leadership, starting the city's first Youth Commission. She has also worked as an agent for her dad's real estate business since 1983 and brought her business expertise to the City Council. She says she helped Santa Clara leaders get more money for their land leases and real estate sales.

And even though Lisa Gillmor has been out of public office for seven years, she still feels accountable. "You are under a microscope, and you may say something that's taken out of context and then 500,000 people are reading about you," she says.

"I think what's really hard is there's this perception," she continues, "and people will say things about my family; I don't even know these people; they don't know anything about me. There aren't any facts, just the perception, you know?"

Gillmor has been the most politically active of her siblings: three sisters and one brother.

She says her familiarity with the community helps her as a real estate agent when she's talking to prospective buyers. One thing's for sure, her family name has attracted attention to one of her most notable listings—and most controversial connection to Santa Clara city leaders: the Morse Mansion near downtown Santa Clara.

Morse Code

There's something special about the Morse Mansion despite its creaky floors and musty smell. The two-story structure, with its wrap-around porch and charming "witch's hat" turret, sits like a grand old dame in the middle of a quiet neighborhood.

Nearly 100 visitors flocked to a recent open house to see inside the historic mansion, the last of its caliber left in the city. Chuck Blair, representing Gillmor Realty, says he felt like a museum tour guide that Sunday when people strolled through the library and old-fashioned pantry, went up the gleaming wooden staircase and peeked around the six uniquely themed bedrooms. They drank in the elaborately grilled indoor fireplaces, colored-glass lamps and detailed wallpaper designs.

It's not hard to imagine that the city would want to preserve this gem, even though it's already protected by state and federal regulations as a registered historical landmark.

Interestingly, Gary Gillmor claims that his main interest is in historical preservation and says the city would be the best patron—even at a $3 million price tag. (For property tax purposes, the house's value is currently assessed at $570,079.)

But critic John McLemore doubts Gillmor's stated motivation. If the businessman really cared about historic preservation, McLemore says, "He would have saved the carriage house behind the building. Instead, he let the elements destroy it."

The historically significant carriage house caved in on itself in the mid-1990s because Gillmor and his investment partners, Nick Livak and Jon Campisi, refused repeated city requests to reinforce the 3,000-square-foot building at an estimated cost of $75,000. To this day, Gillmor admits it was just too expensive to fix. "What for?" he says. "We had no use for it."

His tune changed when it came to time to receiving money for the property. In a December 2006 letter, Santa Clara Assistant City Manager Ronald Garratt mentions receiving a phone call from Gary Gillmor "inquiring as to the city's desire to acquire the property." Garratt politely suggests that Gillmor "look to the private sector."

"Staff cannot recommend purchasing another historic property for the City's portfolio. Even in better economic times, the purchase of the Morse Mansion is not a current priority for the City," writes the assistant city manager.

A few months later, however, the Morse Mansion popped up at a council brainstorming session to set the city's priorities for the next two years. Mayor Patricia Mahan announced that her dream would be for the city to consider purchasing the historic house.

Four councilmembers voted to prioritize Mahan's goal, and six have since voted twice (on May 15 and July 17) to implement the priority plan. None have abstained despite having conflicts of interest: All six who voted have received monetary contributions from the Gillmors and Livaks, both owners of the Morse Mansion.

Gillmor says he had nothing to do with the decision, although his family members, employees and investment partners have given more than $15,000 to six of the seven current councilmembers since 2002. What's more, Councilmembers Dominic Caserta and Kevin Moore work as agents for Gillmor's business.

Caserta lives across the street from the mansion, and Mahan and Councilmember Will Kennedy live less than a mile away from the house. The only one who has managed to steer clear of the controversy, Jamie McLeod, abstained from voting on the council goal plan (because of her life partner's financial stake in a different priority project).

Ironically, she also is the only current elected official in Santa Clara who hasn't received money from the Gillmors or their associates.

"We did not buy [the Morse Mansion] to sell to the city," Gary Gillmor assures me. "We don't care if they can't vote; we're not asking anybody to do anything."

But how convenient that the city's current course suits his needs so well.

As soon as Gillmor heard about the brainstorming session, he wrote to City Manager Jennifer Sparacino: "I personally believe this property is one of the finest historical treasures in the region and should belong to the citizens of Santa Clara. However, time is of the essence in our negotiations, and we would appreciate a response informing us if the City of Santa Clara is interested in the property or not."

Six months later, Gillmor is still waiting. City officials have been looking into the feasibility of the purchase and will likely bring the matter to council this fall.

Pols' Lifeblood

Gary Gillmor is quick to defend his generous support, "Yeah I've contributed," he says, "'cause I think it's the worst thing in the world for politicians to ask for money. Because money is lifeblood to a politician."

At the same time, he dismisses his donations as "peanuts."

He says his family meets regularly to discuss whom they will support. All seem to agree on the same candidates, according to documents I have looked at.

"We've always given money," says Lisa Gillmor. "It's hard to raise money for campaigns. We know that, and that's why we do it. So that's not a secret; I don't think it's a bad thing that we give."

The contributions follow the law, except for the $7,500 in cash they illegally delivered to three council candidates—Will Kennedy, Kevin Moore and Chuck Blair—on Sept. 17, 2004.

One of the family members had Kevin Moore deliver $500 in bills on the same day to Councilmember Pat Kolstad, who spotted a red flag and confirmed with the city clerk that receiving more than $99 in cash violated state campaign laws. He turned his contribution away without ever depositing it into his bank account, unlike the three other candidates, who took more than a month to withdraw the inappropriate funds.

Critic Karen Hardy had Kolstad testify in small-claims court when she tried to sue the Gillmors for nearly $22,000, more than half of which she pledged to donate to the city. The whole Gillmor clan showed up in court, and Lisa and Gary claimed they "didn't know" about the $99 rule. The two former elected officials must have missed the simple, colorful brochure on campaign-finance law given to every candidate by the Fair Political Practices Commission.

The judge dismissed the case because all of the cash contributions were eventually returned (and replaced with checks). Gary Gillmor now laughs at the ordeal and calls it "stupid."

Lisa Gillmor also smirks when I mention the lawsuit and calls Hardy a disgruntled candidate looking for attention. "The fact of the matter was that they were not anonymous cash, brown-bag donations," she says. Hardy admits with an equally edgy smirk that she had a hard-time keeping her composure in court while the Gillmors pointed fingers at the city clerk for misinforming them about the cash limits.

"To me, it was really simple," she says. "They can't say, 'We didn't know.' They did it because they thought they could get away with it."

Critic and former Councilmember McLemore believes the Gillmors are smart enough to influence city decisions in just the right way. "People do try to talk to you one-on-one so there's never a written record," he says about the general culture at City Hall. "They ask you for favors."

Gary Gillmor "is a good person," McLemore continues. "It's just unfortunate to be on the wrong side of his political goodwill."

Gillmor's knowledge of the system has indeed served him over the past 30 years as he has amassed his family wealth. He likes to joke that he has a "Ph.D. in zoning," which he has put to good use at city council meetings petitioning on behalf of clients who wanted to get approval for development projects.

Gillmor says it's been "fun" to banter with city leaders. "I don't know if I got special attention," he says. "I guess I got respect because I could debate with the best of them."

Metro intern Liz McGurn contributed to this article.


Send a letter to the editor about this story.






blank