Political Economy

For years, local politicians had been wrangling over the route to be taken by the southern extension of the Sacramento Regional Transit District's commuter light rail system. Starting in downtown Sacramento, the South Line had a half-dozen possible paths into the exurbs. Speaker Brown's 1989 transportation bill settled the matter by choosing one particular route -- which just happened to be the route that best served North Laguna Creek. The Calvine Road extension of the South Line will cost $222 million and is scheduled for completion in 2003. The fact that it will directly serve Live Oak's North Laguna Creek holdings adds tremendous value to the property.

In all, city and the county governments blessed the North Laguna Creek developers with more than $45 million in road improvements. A new connector -- called Consumnes River Boulevard -- was built for $12 million. Bruceville Road, an arterial leading directly into North Laguna Creek, was widened for $3 million. Millions more have been spent on bridge reconstructions, carpool lanes, bus stops, and slip ramps. State-funded Caltrans is poised to build a $20 million interchange at Sheldon Road and Highway 99, which will greatly ease access into North Laguna Creek.

This cornucopia of transportation improvements did not appear in Laguna Creek by accident. They were deliberately put there by government officials to enable the spread of urban sprawl. They happened to also serve the interests of Willie Brown's Live Oak Associates II.

Only fools -- or canny speculators -- buy fields that lie in a flood plain. Angelo Tsakopoulos is no fool. Tsakopoulos, age 62, immigrated to Sacramento from Greece in the early 1950s. Working as a waiter, he befriended rich customers who passed on real estate tips. By the end of the 1960s, Tsakopoulos had turned relatively minor investments in raw grassland into a fortune, as Sacramento burst its seams and extruded suburbs into areas owned by Tsakopoulos.

Tsakopoulos' relatively quick rise to huge wealth was explained in 1996 by his business partner and daughter, Eleni Tsakopoulos. "Ultimately, what we do is take land that is missing entitlements (e.g. zoning, services, improvements), and we bring it to a later stage," she told the Sacramento Bee. "So a builder can come in and build on it. ... Before that happens, you have a very complex mechanism in place."

Obtaining entitlements for land that has been considered undevelopable involves many activities. For Angelo Tsakopoulos, one of those activities appears to be the making of large campaign contributions. Tsakopoulos isn't just a developer who contributes to political candidates; he is one of the most influential donors in the entire Democratic Party. Over the years, the Tsakopoulos family has donated many millions to local, state, and federal candidates, mostly Democrats. Vic Fazio, for instance, could always count on the maximum contribution from Tsakopoulos. And in the last presidential election, Tsakopoulos donated $185,000 to the Democratic National Committee. In gratitude for Tsakopoulos' gifts, Bill Clinton let the real estate magnate sleep in Lincoln's bedroom. In deference to his importance, Clinton once visited Tsakopoulos' home for a fund-raiser.

For decades, Tsakopoulos' soft money has flooded the campaign war chests of California's Democratic Party. For instance, in 1991 Tsakopoulos donated $50,000 to the Willie Brown Initiative Committee, a group formed to secure Democratic Party control of legislative and congressional districts. And he has particular favorites in the government. For example, Tsakopoulos took now-state Treasurer Phil Angelides under his wing in 1983, making him chief executive officer of his real estate firm, AKT Development Corp. Until he took office this year, Angelides regularly received consulting fees from Tsakopoulos. He still participates in the older man's extensive real estate partnerships, including the Kramer Ranch, a property adjacent to Live Oak's North Laguna Creek.

Between 1988 and 1991, as entitlements were being finalized and North Laguna Creek was being built out, Angelides contributed over $30,000 to Willie Brown's various campaign committees. Tsakopoulos gave Angelides almost $1 million for his two runs for state treasurer in 1994 and 1998.

According to California's Fair Political Practices Commission, Tsakopoulos' largess has even leaked into the private pockets of government officials. In the late 1980s, Sacramento County Supervisor William Bryan went to prison after he failed to disclose $250,000 in loans from Angelo Tsakopoulos. The FPPC alleged that the loans were made to Bryan in return for his votes to favorably rezone Tsakopoulos' and Angelides' holdings slightly west of North Laguna Creek. Tsakopoulos was not charged in the matter.

Tsakopoulos has suggested in the past that his campaign contributions are unconnected to government decisions that would benefit his business activities. Clearly, though, there is a perception that Tsakopoulos' spreading of his wealth has given him enormous power.