Carmelo Garcia and the oversight problem

In February of 2013, Carmelo Garcia demonstrated why no oversight by the Hoboken Housing Authority Board would be possible if he had anything to do with it.

His ability to obstruct a governing board empowered with overseeing his performance in the Hoboken Housing Authority evident, the last public budget in Hoboken of over $15 million, home to thousands of residents saw no real oversight or reform at all.

The existing HHA board would not only fail to pass or implement any meaningful oversight, it could not even obtain a copy of Carmelo Garcia’s existing contract for examination; a contract it was charged with overseeing and previously approved.

Garcia thumbed his nose at the HHA board and the commissioners not in his pocket. At the February 2013 meeting, he would cajole them into approving a renewed contract for Charles Daglian telling them they were subject to ethical and criminal liability if they failed to do so.

Requests for a copy of an item as simple as Garcia’s contract was flagrantly ignored. On rare occasions, Charles Daglian would wield it from his briefcase, allow Garcia to quote some portion designating his appointing powers and promptly put it into his bag as calls to see it met deaf ears.

Promises to later provide a copy of Garcia’s contract were never fulfilled and official requests from HHA commissioners to both Garcia and Daglian saw no compliance whatsoever. (MSV would obtain a copy of the public document from Trenton and exclusively make it available to the public.)

Under this circus like atmosphere, growing concerns on Garcia’s blatant insubordination led to this emailed opinion offered up by the mayor’s husband, Stan Grossbard.

Does a spouse to an elected official have the right to offer an opinion even if it’s ignored as it was here by several HHA commissioners? 

Or is a spouse of an elected official solely permitted input when it’s coupled with a big checkbook, funding numerous political operatives in a concerted effort to undermine other elected officials and do harm to the City of Hoboken and shut down a hospital?

Here is the complete unedited email discussing the HHA procurement problems illuminated under Carmelo Garcia after a fiasco of a HHA meeting.

The US Department of Housing and Urban Development, the overseeing federal agency would weigh in on describing Garcia’s earlier actions on procuring a renewed legal counsel contract for Charles Daglian calling it “legally flawed.”

Daglian’s renewed contract was in effect nullfied although Garcia would attempt to renew his contract almost half a dozen times against the obvious will of the HHA board which rejected his resolution consistently afterwards.

The complete email from the mayor’s husband to several HHA commissioners from February 26, 2013 follow below.

The results then and under this HHA board of commissioners: nothing.

From: []
Sent: Tuesday, February 26, 2013 11:43 AM
To: Dave Mello (; Jake Stuiver (; Greg Lincoln (
Subject: important thoughts
Hi Dave, Greg and Jake,
I just wanted to throw out some thoughts to get you guys thinking ahead of HUD’s guidance on the Daglian procurement process, since we will have to make important decisions very quickly after receiving the guidance.
Carmelo told Dawn that HUD’s chief lawyer was going to “rule” that the board had delegated appointment authority to the ED via contract.  I suspect that while Carmelo is ignoring other parts of the guidance we will receive like HUD’s lack of jurisdiction over corporate governance issues, but HUD is indeed almost certain to say that the contract as written clearly delegates appointment authority because it indeed does.  This would be entirely consistent with the guidance Jake and Dave got from HUD in the sense that the Board’s broad authority to create its own procurement policy includes the authority to delegate to the ED, and the contract clearly does that.
This leaves only 3 choices, as far as I can see:
1.        Accept that Carmelo is the appointing authority until the expiration of the contract, and accept the existing procurement process with only those cosmetic changes Carmelo might permit;
2.       Negotiate a new procurement policy with Carmelo using the threat of the exercise of the Board’s right to terminate the contract without cause as leverage to get Carmelo to cooperate; or
3.        Vote to terminate the contract and give the 120 day notice, and then proceed to adopt a new procurement process acceptable to the Board.
In my opinion, the last choice is really the only choice, and it should be done immediately after the HUD guidance is received.
Accepting the existing procurement process in which Carmelo controls everything without meaningful standards or oversight would be, in my opinion, an abdication of your responsibilities and a violation of the fiduciary duty of the Board to exercise meaningful oversight and I know all of you well enough to know that you share my view that this would be completely unacceptable. 
Choice two may seem like a politically attractive compromise but it simply will not work and will in fact be extraordinarily harmful.  It will predictably result in and ongoing unproductive pissing contest with Carmelo and lots of divisive political theater at meetings with Carmelo doing everything he can to politicize the issue and prevent the adoption of a fair honest process that diminishes his power which is, of course, the purpose of the whole exercise.   We will make no actual progress toward reform and create a toxic politically and racially charged climate that will be bad for everyone but Carmelo. 
The only way we will get an appropriate procurement policy is if the Board imposes it as it is legally permitted to do if it terminates Carmelo’s contract.  We will not get it through a negotiation with Carmelo in which we have no leverage but a threat he doesn’t believe we will carry out.
Choice three does not necessarily mean firing Carmelo.  The Board has 120 days to develop a new procurement policy and offer a new contract to Carmelo or anybody else that reflects the new policy.  I personally believe that the new contract should also revise the compensation and benefit levels since the salary increases in the existing contract seem excessive, 9 paid weeks of (21 vacation, 21 sick and 2 personal) is ridiculous, as is the unlimited right to travel around to conferences and classes.  But that is not a decision that needs to be made now.
In my opinion, the only way the procurement process can be realistically reformed is by immediately exercising the 120 termination provision.  There plain and simply are no other choices that will allow you to do your jobs.  Unless and until you move to terminate, Carmelo has all the leverage, and he will never believe you actually are willing to terminate unless and until you actually do it.   In the end, you will have lost valuable time, endured tons of public abuse, and will wind up having to choose between choices 1 and 3 anyway in an environment in which doing the right thing will have become much, much harder, and perhaps even rendered impossible.
If you want to avoid the perception that Carmelo is being “fired,” make it clear that the Board intends to offer him a new contract.  Research compensation and benefit levels at other PHA’s in Hudson County and throughout the state, find out what other performance standard provisions are typically included in real arms length negotiated contracts, and offer Carmelo a new contract that reflects the fair market, with provisions consistent with the procurement process you adopt.
If he declines to work on those terms, conduct a search and hire someone else.   By giving him first bite at the apple and then ultimately hiring someone qualified on the terms he refused, you demonstrate clearly that you have acted fairly and in the best interests of the HHA.      
Please let me know your thoughts.

Leave a Reply