Community members demanded answers and transparency at Tuesday’s Stockton City Council meeting after news reports revealed the interim city manager had hired a consultant without council approval or competitive bidding.
Interim City Manager Steve Colangelo hired Lathrop City Manager Stephen Salvatore to serve as his consultant for $11,000 a month, according to public documents obtained by The Record. That’s in addition to the more than $20,000 monthly salary Colangelo is being paid.
With Salvatore’s hiring and more than $400,000 in severance and benefits paid to former City Manager Harry Black, Stockton could spend more than $600,000 on city managers this year.
Tuesday night was the first chance for residents to address the council since the consulting contract was made public. Some expressed confusion, while others urged the council to “do the right thing” for the people they represent and fire Colangelo and his consultant.
“We need leadership,” Stockton resident Andrew Abbott said. “The man that four of you hired with no resume and no time to review him has clowned you. An interim manager with no educational background, no qualifications or credentials, and no relevant work experience.”
Stockton resident David Scatena accused Colangelo and the four councilmembers who voted to hire him — Mayor Christina Fugazi, Vice Mayor Jason Lee, District 1 Councilmember Michele Padilla and District 2 Councilmember Mariela Ponce — of engaging in malfeasance.
“Under the leadership of Mr. Colangelo, there has been a noted increase in qualified, competent employees making their exit from city employment, which leaves us with people with limited experience,” Scatena said. “In the best interest of our city, its taxpayers and voters, I highly recommend that you immediately terminate the interim city manager and contracted consultant. The council should then proceed to recruit and interview qualified candidates for a permanent city manager, which will bring stability and acceptability to the management of our wonderful city.”
Stockton has been without a full-time, permanent city manager since Black agreed to resign in lieu of termination without cause on Jan. 9, two days after a new majority on the council was sworn into office.
Colangelo was hired as Stockton’s interim city manager Feb. 4, despite concerns from residents and some councilmembers about his qualifications. A longtime event planner and rental manager, Colangelo was chief executive officer of the San Joaquin County Fairgrounds when a state audit found evidence of financial mismanagement.
Before being appointed by the council in a contentious 4-3 vote, Colangelo had no local government experience. He replaced Will Crew, a deputy city manager who briefly served as Stockton’s acting city manager after Black’s departure. Crew has more than 25 years of experience in local government and has worked for the city since May 2020.
Councilmembers who voted in favor of Colangelo’s hiring, including Fugazi and Lee, downplayed public concerns about the interim city manager at the time. In a video posted on Facebook, Fugazi said Colangelo “isn’t our forever city manager,” while Lee said he didn’t care who sat in the city manager’s seat because they would be fired “if they don’t do the will” of the council.
Consulting deal bypassed council and competitive bidding
The consulting services agreement was signed Feb. 18 by Colangelo and Salvatore without council approval or competitive bidding — a week after Colangelo assumed his role as interim city manager.
In a Feb. 27 memo to City Attorney Lori Asuncion, Colangelo said the agreement was structured as a sole-source contract within the city manager’s discretionary authority.
“Under the terms of the agreement, Mr. Salvatore will serve strictly in an advisory role, providing strategic guidance to the interim city manager on best practices in municipal management,” Colangelo said in his February memo. “He will not assume any policymaking authority or operational control over the city’s functions. His role will be focused on offering insights and strategic recommendations to support Stockton’s interim leadership.”
Salvatore has worked for Lathrop for nearly two decades, primarily as city manager. His agreement with Stockton is effective for six months and will end Aug. 18, unless he is terminated earlier.
“The contract falls within the procurement threshold of less than $100,000, allowing the city manager to exercise discretion in securing specialized advisory services without requiring a competitive bidding process,” Colangelo said in his memo. “This decision reflects the city’s determination that Mr. Salvatore’s unique qualifications and regional experience justify a sole-source arrangement, ensuring the city receives targeted and effective guidance during this transitional period.”
Although Colangelo sent a memo to the city attorney about Salvatore’s hiring, he declined to submit the sole-source justification form required to bypass competitive bidding.
“Per (Deputy City Manager Courtney Christy), the interim city manager has declared his justification for a sole-source in his memo and will not be providing the SSJ document,” Nicole Mamorno, a senior management assistant in the city manager’s office, said in a March 20 email to Stephennie Link, a city procurement specialist.
It’s unclear why Colangelo declined to submit the form. He did not respond to an inquiry from The Record or to questions about why he hired a consultant, whether other candidates were considered for the job, and whether he felt more comfortable in his position with Salvatore’s assistance. He also did not say whether he disclosed previous concerns to the mayor and city council, or provide specifics about the work Salvatore does for the city.
However, Salvatore’s invoices submitted to the city provide some details about the services he is providing.
In his February invoice, Salvatore said he “attended several meetings, conference calls and Zoom calls to discuss homeless issues,” as well as “potential options for progress on assistance and strategy.” He also said he “discussed options for assistance in the finance department” and “brought resources to the city of Stockton for assistance with payroll services and (a) budget audit.”
In his March invoice, Salvatore said he reviewed and revised a request for proposal for a forensic audit, “worked with Pun Group to scope out (the) forensic audit and prepare for execution and city manager signature,” and attended various meetings to provide general guidance on municipal budgeting and operations.
City records show Salvatore was paid $22,000 for his consulting services in February and March.
Procurement process deviated from ‘standard practice’
Internal emails obtained by The Record through a California Public Records Act request show that at least one city employee expressed worry about the approval process for Salvatore’s consulting services agreement, stating it was not the city’s standard practice to proceed with agreements when funding availability cannot be confirmed.
In his memo, Colangelo said the agreement would be funded through the city manager’s special and professional services account.
Internal emails show that while officials decided the city manager’s special and professional services account was the most appropriate funding source for Salvatore’s contract, Christy cautioned that it could strain the account.
“We can document that, holistically, the city manager’s accounts will be overdrawn by the end of March as we work through the city manager transition,” Christy said in a March 2 email to Colangelo.
Christy acknowledged that the city was already paying a separation settlement and 12 months of severance for Black, along with a second city manager salary for Colangelo — both approved by the council without a corresponding budget appropriation. She added that other expenses were expected as the city manager’s office continues to transition but suggested the issues could be addressed later in the fiscal year.
“The alternative, and what we would typically do, is take the item to council for approval of a budget appropriation to fund now, likely coming from reserves,” Christy said.
City spokesperson Tony Mannor did not respond to an emailed list of questions about the matter, including whether funds have already been allocated to pay for Salvatore’s contract. He also did not confirm whether the city manager’s accounts are overdrawn or explain why the city moved forward with a contract that staff said did not follow standard city practices.
Indemnity clause in place without insurance
While funding for Salvatore’s contract was being discussed, internal emails show the city’s Risk Services Division — which reviews all city contracts with outside contractors and consultants — agreed to waive liability insurance.
Liability insurance is required in “all instances where vendor personnel enter city property to repair, install, service, construct and consult,” according to the city’s website.
In a Feb. 27 email to Colangelo, Christy asked whether he had been able to discuss insurance requirements with Salvatore. Colangelo replied, “I would like to execute this today.”
In a March 4 email to Nathan Birtwhistle, Stockton’s risk manager, Christy asked if his division was OK with the interim city manager waiving insurance requirements. Birtwhistle said, “I’m fine with it, considering all decisions on actions taken will remain with the (interim city manager). In a lose-lose situation, not doing this could be far worse than doing it.”
“(Interim city manager) would like to execute one way or the other, ASAP, understanding that he may have to waive the standard process/requirements,” Christy said. “We just need to be clear about the risk associated with waiver.”
Salvatore’s contract also includes an indemnity clause stating that the city will “defend, indemnify and hold (him) free and harmless from any obligations, costs, claims, judgments, attorneys’ fees, and attachments arising from, growing out of, or in any way connected” with services rendered to Stockton under the agreement — unless a court finds him “guilty of willful misconduct.”
In his February memo, Colangelo said, “The city’s Risk Division has reviewed the scope and terms of the agreement and supports a waiver of the city’s standard insurance requirements, as well as acceptance of Mr. Salvatore’s proposed indemnification language.”
Does Salvatore’s Lathrop contract allow consulting work?
Salvatore joined Lathrop in January 2008 as public works director. He later served as deputy city manager before being named city manager in 2012.
In 2023, Salvatore’s salary and benefits in Lathrop totaled more than $270,000, according to Transparent California, a database of public employee salaries in California.
Salvatore’s contract with Lathrop states he must “remain in the exclusive employ” of the city and may not accept other work without written approval from the city. However, it allows for “occasional” teaching, writing, speaking or consulting during his “time off.”
It’s unclear whether Salvatore’s six-month consulting contract with Stockton qualifies as “occasional” under the terms of his Lathrop agreement.
Lathrop officials, including Salvatore, City Attorney Salvador Navarrete and Mayor Paul Akinjo, did not respond to an emailed list of questions. The questions included whether Salvatore’s agreement with Stockton is considered “occasional” work, his schedule for Stockton, and whether he notified Lathrop about the consulting work.
What city leaders have to say about the agreement
Fugazi said in a statement that the situation “has been misrepresented in a way that distracts from the real work happening in our city.”
“Interim City Manager Steve Colangelo acted well within his authority to consult and contract services under his discretionary budget,” Fugazi said. “I commend him for being proactive in tapping into the expertise of one of the region’s most seasoned city managers. With over a decade of leadership in one of California’s fast growing and fiscally sound cities, Mr. Salvatore brings valuable insight that will benefit Stockton moving forward.”
District 3 Councilmember Michael Blower told The Record he was disappointed to learn about Colangelo’s consulting contract with Salvatore from the press.
“A contract that large is technically under what had to be presented to us, but it would have been nice to have the heads-up,” Blower said. “I also think it makes the point that I was trying to make back in February — that we should really see if somebody has the qualifications or not.”
During Tuesday’s council meeting, District 4 Councilmember Mario Enríquez said he had “a rough couple of weeks in office” before sharing his thoughts on the issue.
“We’re all adults,” Enríquez said. “We don’t have time for the chitter-chatter or the high school drama, and I like to go to the source. If I hear anything, I don’t like to make assumptions about anyone.”
Enríquez said he had the opportunity to meet with Colangelo and ask him for more information before the council meeting.
“Was it the most comfortable conversation? Not necessarily, but again, this is governance,” Enríquez said. “This is what we have to do to be able to work together and understand each other, and I want to thank him for his clarity.”
Enríquez did not elaborate on his conversation with the interim city manager, but encouraged people “to go to the source and ask clarifying questions.”
Lee said that at the last Council Audit Committee meeting, members requested copies of all contracts the interim city manager has entered into since he was hired, and that the documents will be made available at the next committee meeting.
Padilla and Ponce did not comment on the issue, and District 5 Councilmember Brando Villapudua was absent from most of Tuesday’s council meeting.
Read the documents
Record reporter Hannah Workman covers news in Stockton and San Joaquin County. She can be reached at hworkman@recordnet.com or on Twitter @byhannahworkman. Support local news, subscribe to The Stockton Record at https://www.recordnet.com/subscribenow.
This article originally appeared on The Record: Some Stockton residents call for firings over interim city manager’s consultant deal
Reporting by Hannah Workman, The Stockton Record / The Record
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