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The non-retiring Carlos Carballada


Carlos Carballada is kind of an enigma. Many people have never heard of him and couldn't pick him out in a lineup. But in the worlds of commercial banking, city government, and education, he's much more than well known: the 82-year old Carballada is a deeply admired elder statesman.

Carballada's success is a bit challenging to explain, partly because he's so unpretentious. But Carballada's accomplishments and his commitment to Rochester are almost immeasurable and go back decades. He held top positions in three of the area's most prominent banks and was elected chairman of the New York Bankers Association. In the late 1970's, he was elected to the New York State Board of Regents and was later named chancellor, a post he held from 1991 to 1994.

When former mayor Robert Duffy first took office, he turned to Carballada, making him his commissioner of economic development and a member of what Duffy called his dream team.

"When I got elected, Carlos was one of the top three people I reached out to," Duffy says. "I wanted to build a team that had strengths that I didn't have. I remember interviewing him, and he asked, 'What makes you think I know anything about economic development?' But I knew that what Carlos has probably forgotten about business, most of us will never learn."

Carballada was even Rochester's mayor, though briefly: After Duffy decided to join Andrew Cuomo's gubernatorial race and run for lieutenant governor, he appointed Tom Richards to take over as mayor. Richards, however, was forced to resign so he could run for mayor in a special election without violating the Hatch Act. So he, too, turned to Carballada and made him acting mayor.

In a span of about three rather strange weeks, Rochester had as many mayors, and Carballada was one of them. At the time, radio host and columnist Bob Lonsberry referred to him as a "footnote in Rochester history."

But that was hardly true; Carballada provided reassurance to a city hall and a public dizzied by what they were seeing in a time of general uncertainty. The country was still reeling from one of the worst financial crises in decades, and Rochester, like much of Upstate New York, seemed to be stuck in a chronic malaise.

"He has what some people refer to as the common touch, a quiet wisdom," says Richards. "He was good at what he did, but not just because he could apply rigorous financial analysis. He could also get people to do things that needed to be done."

Carballada also has had an uncanny ability to navigate his way through multiple administrations relatively immune to the politics that accompanied them.

"You have a certain amount of partisanship in politics, and image really matters to some people," Richards says. "He never got into any of that, and I think that's why so many people trust him."

After Lovely Warren won election as mayor and Carballada left City Hall, he was asked to head RIT's Center for Urban Entrepreneurship to help get it started. And then last year, he was pulled back, this time by Warren to serve temporarily as deputy mayor for retiring Leonard Redon.

Warren has since chosen former police chief Cedric Alexander to fill the job permanently. Carballada is continuing at City Hall through the end of June to support Alexander.

Rochester wasn't in the headlines during the Great Recession like Phoenix, Las Vegas, and Detroit, where home foreclosures were engulfing whole neighborhoods, but this city faced its own problems. The Big Three – Kodak, Xerox, and Bausch and Lomb – were periodically shedding employees. And downtown was suffering from 30 years of decline.

While city leaders around country were busy conjuring up ways to convince corporate honchos to relocate their operations, Carballada advised Duffy to concentrate instead on those businesses already in the city. If they had a solid lead for an out-of-town business, they would certainly follow up on it. But getting businesses in Ohio or Pennsylvania to move here wasn't a magic bullet for reviving downtown economy, Carballada says.

"My first priority was to keep what we had," he says. "We have to see if we can help them grow right here, make more money, hire more people, and pay more taxes."

Carballada drew up a list of businesses in the city, and he got Duffy to agree to go out on what were essentially meet-and-greets.

"I asked him if we could devote at least three afternoons a week, and he did," Carballada says. "It caused an unbelievable reaction. Many of them could have packed up and gone anywhere they wanted. We wanted them above all to stay here. It was personal for us."

Duffy says he couldn't have done this without Carballada. And he credits him with convincing ESL's officials to build their headquarters downtown.

"To be successful in banking, you need relationships," Duffy says. "People know Carlos, and when Carlos calls on the phone, people answer it. When he knocks, doors open."

Carballada says that a lot of time was spent in those days trying to envision the future of downtown. But when trying to imagine what Main Street would look like 20 years down the road, he and Duffy would always need to circle back to more immediate problems. The old Midtown Plaza complex was their biggest roadblock, he says.

"We were trying to figure out what to do with Midtown, with all these places in it going out of business and nothing to replace them," says Carballada. "And then how could we deal with all of the asbestos in taking down that facility? We knew that was the best option, but how do we do this?"

Duffy posed what seemed like an outlandish idea, given the economy at the time.

"Bob started asking, Do you think the state would ever help us tear it down," Carballada says. "Somehow Bob convinced them into doing just that."

There were also concerns about whether some of the city's biggest developers were overextending themselves with the size of the projects they were undertaking and the debt they were incurring, he says. Among them: Larry Glazer, the late head of Buckingham Properties.

"We talked to him about that all the time," Carballada says. "When I was in banking, people would come in to see us about money, and some of these associates were tied up with businesses like Kodak and Xerox. I would tell them, you've got to diversify your business. Well, that was a while ago, and we all know what happened to those companies. And we were talking to Larry after all of this. We kept asking him, 'Larry, are you sure you can handle all of this at the same time?'"

Glazer insisted that he could.

"He's been proven correct," Carballada says. "He really was a visionary."

Carballada is bullish on the development he sees in downtown today. And he says he's not worried about a real estate bubble. The data he's seen, much of it from Rochester Downtown Development Corporation, shows that there is still a demand for residential units downtown, he says.

And he says that more retail is coming to downtown, though it won't be anything like the retail of the past. What's needed now is more connectedness between the attractions and amenities downtown, Carballada says.

"They bring 500,000 people every year into the Strong Museum, and they're hoping they can increase it, and I think they can," he says.

Carballada, like many city officials, has been concerned about the Midtown's Parcel 5 and how this central piece of downtown real estate should be developed. And for a while, it seemed like developer Andrew Gallina's proposal for a $30 million 14-story building with a mix of residential, retail, and offices was a go. Carballada, as deputy mayor under Warren, was rumored to be supportive of it.

But Warren surprised many people earlier this year when she selected a proposal from Rochester Broadway Theatre League. The proposal calls for a $130 million performing arts center and a 10-story residential tower on Parcel 5 in partnership with developer Robert Morgan.

There have been financial concerns about a performing arts center ever since it was first discussed many years ago. But the RBTL project appears to have been chosen in part because Paychex founder Thomas Golisano has committed $25 million to it.

While that may quell some of the money concerns surrounding the project, the former banker in Carballada isn't so optimistic.

"I don't think there was concern about Bob Morgan's part of the proposal, because he's got a wonderful reputation, and he's got relationships with many banks," says Carballada. "The portion that everybody was always concerned with was the financing of the theater itself, and Mr. Golisano's contribution helps in that regard. But they're still going to need about $85 million to $90 million, and they've got $25 million of that, so you can do the arithmetic."

There's also the issue of operating costs, says Carballada.

"The city and the county are not in a position to subsidize the operating costs," he says. (RBTL leaders say the organization consistently makes a profit and won't need operating subsidies.)

Carballada is also concerned about whether photonics will become a major industry for Rochester as anticipated. There's no indication that it won't happen, but moving from the announcement into implementation requires collaboration between multiple private and public agencies, which takes time.

"I think all of us want to see the proof to that premise, that it is going to be the way it has been portrayed," Carballada says. "It's a lot easier talking about something like this, something of this scale, [than] actually doing it."

But he also offers a word of caution: "We should make sure that we are holding our officials to the fire about this issue," says Carballada. "We should be constantly reminding them of the great announcements and enthusiasm and projections."

Clearly, one of Carballada's biggest worries about Rochester's future is its public schools. Education is a long-time passion of his. As vice chancellor on the Board of Regents, Carballada, a banker at the time, was a strong proponent of giving parents public money in the form of vouchers that could be used at private and parochial schools.

"I tried to introduce a test case for vouchers," he says, "but at that time the powers that be didn't agree." Carballada insists that he is not advocating for school choice as much as he is a proponent of giving parents the ability to remove their children from failing schools.

"For a long time, the children in many of our cities, including Rochester, have not received the educational opportunities they deserve," he says. "That is our biggest responsibility in this life. In my judgment, the system of education that doesn't give children hope and opportunities can lead them to what I call a life of financial slavery."

When speaking to parent groups, Carballada stresses the importance of reading and being in school with a minimum 95 percent attendance rate. He also encourages parents to mobilize and to be active in their schools because parent engagement drives improvement. Parents should focus their attention on helping students learn, and not on administrative matters.

"Focus on education and not on the issues between adults, which in my view often have nothing do with the children," he says.

But he also says it's unfair to encourage parents to take responsibility and advocate for their child's future, and then deny them access to high-performing schools.

This fits with Carballada's business acumen: he sees parents and families as customers of the district, and the customer always comes first.

Customer service has been consistent theme in his long career. Quality customer service is inexpensive to implement, he says, and when it's done well it can be transformative, influencing perceptions and profitability. And in Carballada's view there's a kind of gestalt to it that begins with employees.

"How do you engage people, and how do you get them motivated?" he says. "What is critical to understand about really good customer service is that you also need to service or help the employee. They're connected. You can't have one without the other."

When Carballada went to work for Duffy, he gave a lot of thought about how to improve Rochester and distinguish it from other cities, he says. Still new to city government, he saw that many cities struggle to varying degrees with the same problems: education, poverty, crime. What impact do city employees have on them?

"With an organization of some 3,000 people, what if we as a group could collectively show our citizens that we're not here to boss them and we're not here to be after them about this or that – we're here to help them?"

In a digital world that puts so much emphasis on hits, likes, and followers, Carballada insists that there's still nothing comparable to harnessing the power of positive in-person experiences with customers. But some of his toughest skeptics were city employees, he says.

During a meeting with the city's building inspectors, he asked them to do a little basic math and tally how many people that they meet every year. The group estimated that together they had made more than 40,000 in-person contacts.

"That's almost one quarter of our population, and that was just one group of employees," Carballada says. "Creating a different culture takes time. It takes time to help people understand that what they're doing is important."

And now? "Retirement" isn't a word Carballada typically uses. Maybe that's because he doesn't get the chance before someone calls him asking for his help.

"I want to stay involved with the city," he says. "I have a number of people who have given me recommendations of what I should do, but I need some time to think."

It won't be sitting down and doing nothing, though, he says; "You have to stay active if you want to be relevant."