Roseville’s shadow nonprofit blasted for mixing public resources with private development

Public-private partnerships have become a go-to option for cities in the Sacramento region

This is an extended version of a story that appears in the July 5, 2018, issue.

The Placer County grand jury recently challenged Roseville officials’ frequent assertion that a nonprofit created by the City Council in 2010 is an independent entity.

The Roseville Community Development Corporation, or RCDC, was formed to help revitalize the city’s historic downtown after Gov. Jerry Brown nixed redevelopment funds. In its new report, the grand jury found that while the RCDC has had a positive impact on Vernon Street, the active role that top city leaders played in managing and operating that outfit equals “a private arm of a public entity, rather than a separate non-profit corporation.”

The grand jury’s findings suggest the RCDC effectively allowed the city to enter into limited liability corporations and partnerships, skirting bidding requirements on projects. The findings also suggest the nonprofit gave the city a foggy avenue for taking out mortgages, owning assets long-term and accepting charitable donations.

City staffers have been intimately involved in the RCDC. Former economic development director Chris Robles acted as its CEO before retiring March 5. He was replaced by yet another city official, Mike Isom. The grand jury found that former City Manager Rob Jensen, who just retired, would consider Robles’ work running RCDC as part of performance reviews for his city job.

The grand jury also noted that Roseville didn’t track hours of other city employees used by the RCDC and that “the public does not know the full extent of city resources that are being devoted to RCDC.”

This finding came, incidentally, just days after Roseville council members approved a half-cent sales tax measure for the November ballot to address what city officials have consistently claimed is a $14 million annual budget gap. Contacted for comment, city spokesman Megan McPhereson said, “We’re evaluating the grand jury report and will have a response at a later date.”

Future RCDC operations remains uncertain. The council voted at a February 7 workshop to direct the corporation to pursue a “strategic pause” of its activities.