On the Mayor’s Seven-Point Housing Plan

Affordability Mayor: A Housing Bait-and-Switch?

To believe Mayor Ed Lee’s pledge to build 30,000 housing units in San Francisco over the next six short years, you’d also have to believe P.T. Barnum said “There’s a sucker born every minute.” [It wasn’t Barnum who said it; Wikipedia indicates several sources attribute the aphorism to various con men.]

…voters in November 2012 authorized the Mayor’s new Housing Trust Fund to receive just $36.8 million in diverted-from-the-General-Fund appropriations during the same six-year period. How do you divide $36.8 million in fish and loaves, and come up with $500 million?”

For openers, although the mainstream media reported January 17 details of Mr. Mayor’s seven-point plan to solve the City’s number one crisis (affordable housing), the media failed to note the Mayor’s bloviated claim to issue 2,500 down-payment-assistance loans during the next six years — and increase each loan to up to $200,000 — may end up costing a half-billion dollars. The media didn’t report, and apparently didn’t bother asking, where the Mayor plans to come up with a cool $500 million in order to hand out 2,500 interest-free loans within six years.

Mayor Ed Lee
Photo: Luke Thomas /fogcityjournal.com

Will Google, or Twitter — or Ron Conway, and Danielle Steele’s ex-hubby, Tom “Don’t Persecute Billionaires” Perkins — donate upwards of $450 million out of their collective “tech” deep pockets to make these interest-free loans happen?

After all, the enabling legislation passed by voters in November 2012 authorized the Mayor’s new Housing Trust Fund to receive just $36.8 million in diverted-from-the-General-Fund appropriations during the same six-year period. How do you divide $36.8 million in fish and loaves, and come up with $500 million? Using bloviated fish? By cracking open a magnum of a City Hall mixologist’s “infused” wine?

Unfortunately, public safety employees in San Francisco — and particularly, citizens who vote — appear to have been played for a sucker over the Housing Trust Fund approved by voters in November 2012, a fund administered by the Mayor’s Office of Housing and Community Development.

The Housing Trust Fund appears to potentially be a bait-and-switch all of its own.

Proposition “C” approved by voters on the November 2012 ballot permitted the City to divert $20 million annually from the City’s General Fund towards constructing housing (without explaining what General Fund programs would face the chopping block to free up $20 million annually). The City will add an additional $2.8 million annually to the Housing Trust Fund on a compounded basis for the next 11 years, until 2024-2025.

By the time 2025 rolls around — just 12 years into this program — the General Fund will be tapped for $50.8 million annually for this Housing Trust Fund (again with no mention of what else will be cut from the General Fund). By 2025, a combined $424 million will have been diverted from the General Fund to the Housing Trust Fund.

Between 2025 and 2043 (since it’s a 30-year program), the annual allocation to the Trust Fund will be based on the prior year’s appropriation that will ostensibly start at $50.8 million, adjusted plus or minus an unspecified percentage of change to the City’s General Fund Discretionary Revenues. By 2043 — assuming a flat contribution of $50.8 million annually in each of the next 18 years — an additional $914.4 million will be generated, bringing the total 30-year contributions to the Housing Trust Fund to a staggering $1.34 billion promised for a wide variety of housing, not just down-payment assistance loans.

Raising $500 million for down-payment assistance loans is scheduled to take at least 14 years, not the six years reported in the media. And that would assume that the first $500 million in General Fund contributions to the Housing Trust Fund would be used solely for down-payment assistance loans, and all other housing programs would receive nothing during those 14 years.

In the next six years, will we be any closer to having any of the housing built promised by the Mayor and his Housing Trust Fund? Probably not. Just take a look at the dismal performance of the Housing Trust Fund so far. But first, take a look at the Mayor’s recent past for some context.

Mayor Lee Whipped at the Ballot Box

You wouldn’t know it from the dearth of post-election news analysis by our major media, but there were a number of significant losers in San Francisco’s municipal election last November.

When voters rejected Proposition “B” on the November 2013 ballot by a whopping 63 percent, they rebuffed the developers of luxury condos who had asked voters whether the City should allow development at 8 Washington Street. Mayor Lee was among the official proponents of the ballot measure. The same voters also rejected Proposition “C” at the same time, which was a referendum on whether the Board of Supervisors spot-zoning height increase for 8 Washington should take effect. More emphatically, over two thirds of voters — 67 percent — cast “No” votes.

The biggest loser over Propositions “B” and “C” was Mayor Lee — who lost any hope that his “legacy” project of the Warrior’s stadium planned to be built on the Bay exceeding height zoning would survive voter scrutiny, forcing Lee to go in search of his next “legacy.”

Other losers included the Board of Supervisors, trounced by referendum of the people against the Board’s flagrant use of spot-zoning height increases along the waterfront. The twin losses for Lee and the Supervisors so rattled them, that none of them dared to become the official opponent of the upcoming Proposition “B” on the June 2014 ballot that would require each project proposed for development on the waterfront that would exceed current height restrictions to obtain project approval by voters at the ballot box, beforehand.

A poll conducted for the Harvey Milk Club last December shows 75 percent of likely San Francisco voters favor this June 2014 ballot measure, which will probably pass handily. Also listed in the 2012 voter guide as proponents of the 8 Washington ballot measure, Supervisors Mark Farrell and Scott Wiener suffered an embarrassing loss at the ballot box. No wonder there were no takers to be the voter guide opponent on June’s Prop “B.” Wiener and Farrell hate losing.

And finally, the losers include the California State Teachers Retirement Fund (CalSTRS). As the Westside Observer reported in September 2013, an October 30, 2008 letter to the San Francisco Port Authority pledged that CalSTRS would make an equity contribution in the range of $100 million for project rights to 8 Washington. A February 19, 2009 Port Authority memo stated CalSTRS would have a 99 percent ownership interest in 8 Washington. As of September 2013, CalSTRS had invested $42 million in the 8 Washington project.

It isn’t clear how much the teacher’s pension fund lost when 8 Washington went down to double defeat, but it is known that CalSTRS lost over $100 million in a failed attempt to convert Stuyvesant Town — 11,250 middle class rent-controlled apartments in New York City’s Peter Cooper Village — into high-end luxury housing. Not to be outdone, the California Public Employees’ Retirement System lost $970 million it had paid to Lennar Housing in 2007 for part of a stake in Newhall Land Development Company’s “Newhall Ranch” deal north of Los Angeles that went bankrupt when the housing market crashed in 2008.

You have to wonder why Major Lee is cavorting with Lennar Urban’s massive housing development in the Bayview Hunter’s Point project and Lennar’s development on Treasure Island, given that Lennar’s Mare Island project was reported in July 2013 to also be in bankruptcy. Hopefully, Lee’s legacy will not be “the bankruptcy mayor.”

Housing Trust Fund Components

The November 2012 voter guide stratified how the $20 million Housing Trust Fund would be put to use, terms of which were to determined by the sole discretion of the Mayor’s Office of Housing. First, the voter guide indicated an unspecified amount would be used to create, acquire, or rehabilitate rental and home ownership for households earning up to 120 percent of Area Median Income (AMI), including acquisition of land. The AMI amount as of January 2014 is $67,950 for a one-person household, and $104,850 for a five-person household; 120 percent translates to $81,550 and $125,800, respectively.

Second, the 2012 voter guide indicated that no later than July 2018, the City would appropriate $15 million from the Trust Fund for down-payment loan assistance programs of up to 120 percent of AMI — ostensibly for non-first responders — and an unspecified percent of AMI for public safety first responders. The percentage of AMI for first responders was to be set at the sole discretion of the Mayor’s Office of Housing, but Supervisor Mark Farrell infused himself into the “sole discretion” discussions. Farrell is just one of City Hall’s creative mixologists infusing the wine.

Third, the voter guide reported that also by July 2018, the City will appropriate another $15 million from the Trust Fund for use as “assistance to reduce the risk to current occupants of a loss of housing,” and for use in making their homes safer, more accessible, energy efficient or “more sustainable” under a “Housing Stabilization Program” component of the Trust Fund for residents earning up to 120 percent of AMI.

Fourth, the Trust Fund would be permitted to use funds to operate and administer a “Complete Neighborhoods Infrastructure Grant Program” to accelerate the build-out of public realm infrastructure needed to support increased residential density. The Infrastructure Grants would be used only for public facilities identified by California’s Community Facilities District laws, and would give priority to residential development “project sponsors, community-based organizations, and City departments” for public realm improvements associated with proposed residential development projects. Funding would be restricted to no more than $2 million annually, or 10 percent of appropriations in any given year. [By 2025, 10 percent of the $50.8 million annual contribution to the Housing Trust Fund translates to $5.8 million for infrastructure grants.]

Fifth, the voter guide indicated the City could allocate an unspecified, but “sufficient amount” to cover legally permissible administrative costs of the Fund, including legal expenses and, ostensibly, personnel costs.

But the voter guide never told voters that up $1.34 billion would be provided to the Housing Trust Fund over the 30-year legislation. Still, lured by the smell of money, voters passed Proposition “C” all but ignoring that it contained a poisoned pill buried in the legal text of the initiative: For certain residential projects beginning after January 2013, the City would be required to reduce by a staggering 20 percent the current on-site inclusionary housing obligations of developers to develop “affordable” inclusionary housing.

The voter guide also stipulated that as of January 2013 the City would not be allowed to adopt any new land use legislation or administrative regulations that would require project sponsor’s to increase their inclusionary housing cost obligations beyond those required on January 1, 2013, including the 20 percent reduction.

You’d need to be a land-use attorney to understand which sections of the Planning Code would be subject to the 20 percent reduction to inclusionary housing requirements, which appears to be a reward to developers for not opposing Proposition “C” at the ballot box. After all, the developers are anxious to milk the $1.34 billion Housing Trust Fund.

To the extent Prop. “C” was backed by the Mayor, you have to wonder about his claims concerning “affordability,” given the poison pill in the November 2012 Proposition “C” that reduced affordable inclusionary housing by 20 percent in order to placate developers and investors.

The Eligibility Feeding Frenzy

Within two months of his stinging defeat over 8 Washington, the Mayor’s social media spin doctors had created a new persona for him: That as the “affordability mayor” pushing an “affordability agenda.”

The ensuing food fight that broke out over use of the Housing Trust Fund was nasty. Back in July 2013, just after the City adopted its fiscal year 2013-2014 and 2014-2015 budget, a coalition of advocates tried to broker an agreement that not only would teachers and nurses be eligible for the down-payment loan assistance programs (DLAP) along with police, firefighters, and sheriff employees, but all City workers would be eligible, too.

In particular, public safety dispatchers who dispatch 9-1-1 calls to police officers and firefighters had sought to be included in the first round of loan funding, but were rebuffed, as were the teachers and nurses. Supervisor Farrell fought bitterly with the Mayor’s Office of Housing (MOH) during negotiations regarding eligibility for the so-called “first responders” carve out from the DLAP funds. Farrell had initially wanted firefighters and police officers to be allowed to earn up to 250 percent of AMI, which would have equaled $169,875 for a one-person household, and up to $262,125 for a five-person household.

Supervisor Farrell’s meddling prevented the 9-1-1 dispatchers from eligibility, and dispatchers may not have been informed they could apply under a separate non-first responder’s down-payment assistance loan program, instead.

On July 30, 2013 Farrell spoke at a City Hall news conference flanked by Fire Chief Joanne Hayes-White, Police Chief Greg Shur, and Mayor Lee. Farrell announced that the DLAP loans would be restricted to public safety first responders, with a maximum down-payment loan assistance amount of $100,000. Farrell — like others — hope to entice public safety officers to move back into San Francisco from other jurisdictions. Fat chance.

According to an article in the San Francisco Chronicle the next day, reportedly “more than 45” police, fire, and sheriff personnel had expressed interest in applying for the first responder DLAP loans. The Chronicle didn’t report on whether Farrell mentioned during his news conference that a second DLAP program for non-first responders was also under development.

Farrell doesn’t seem to get it — as most politicians don’t — that without 9-1-1 dispatchers residing in the City and County, police, fire, and other first responders will have insufficient dispatchers directing them to 9-1-1 emergencies. After all, 9-1-1 dispatchers are the City’s first, first responders.

Eligibility Conundrum: 9–1–1 Dispatchers vs. Public Safety vs. Others

The first-responders DLAP program was created in November 2012 to help entice public safety personnel to move back to San Francisco from outlying jurisdictions. Presumably, after the next big earthquake or other disaster, there are too many public safety officers residing out of county, and recovery efforts will be stymied by the inability of staff to get back into the City to provide public safety.

Data from the City’s Department of Human Resources obtained in January 2014 shows that:

Of 2,161 employees in the Police Department, fully 75.5 percent live out-of-county

Of 1,386 employees in the Fire Department, 67.3 percent reside out-of-county

Of 809 employees in the Sheriff’s Department, 76.6 reside out of county

Of the 147 Public Safety Dispatchers in job classification code 8238, 66.7 percent live out-of-county

Of Public Safety Dispatcher Supervisors in job classification codes 8239 and 8240, 77.4 percent live out-of-county, the highest percentage of first responders who do — since ultimately, dispatchers are our first first responders.

The number of police, fire, sheriff, and dispatchers who live out of county is a combined 73 percent, a figure that probably has disaster recovery planners and resiliency planners very worried. Why isn’t Supervisor Farrell worried about reducing the number of dispatchers residing out-of-county? Does Farrell think the police and firefighters can dispatch themselves, given an insufficient number of 9–1–1 dispatchers who currently reside in-county?

And as far as the maximum income levels issue goes, if eligibility for one-person households earning up to 200 percent of AMI is currently set at $135,900, fully 94.4 percent of line-staff dispatchers would qualify and 96.9 percent of dispatch supervisors would qualify, as would 78 percent of Sheriff’s safety personnel. This contrasts starkly to just 46.6 percent of police officers who would qualify, and just 22.4 percent of firefighters and paramedics who would, according to payroll data provided by the City Controller.

When it comes to maximum income eligibility levels for four-person households earning up to 200 percent of AMI currently set at $194,200, fully 100 percent of both dispatch line staff and their supervisors would qualify, as would 98 percent of police officers and Sheriff’s staff, compared to only 75.9 percent of firefighters and paramedics who would.

But with all that said, there is no data available that could be requested from the City to analyze either: 1) How many potentially-eligible police, firefighters, Sheriff’s deputies — or even 9–1–1 dispatchers — may have double- or total-household income levels (including spouses and any other income-earning members residing in their households) that would disqualify them from either the 120 percent or 200 percent of AMI restriction?; and 2) How many of the police, firefighters, and Sheriff’s deputies versus the dispatchers already own homes, and, therefore, may be ineligible under first-time buyer restrictions.

That may explain why Flannery reported that there were just 12 first responders who were drawn in the first-year lottery for the DLAP loans: Their total household income may be far higher than the maximum percentage of AMI permitted, or they may already own homes, making them ineligible under either criteria.

Had dispatchers been eligible for the first-year lottery, perhaps more than four loans may have already been awarded. Or, had Farrell not infused himself as a mixologist during the eligibility food fight, perhaps by having opened up eligibility to nurses or teachers — or to all City employees — it may have yielded a better first-year use of the DLAP funds that remain unspent nine months into the current fiscal year.

Lack of Documentation

On December 29, this author placed a records request to Mayor Lee asking for a list of the first and last names, job classification codes, and City Department of each applicant who had applied for assistance under the Prop. “C” down-payment loan assistance program once the program began accepting applications in August 2013. Also requested was a second list of each applicant who had qualified, and a third list showing each applicant who had actually been awarded a down-payment loan and the amount of each loan awarded.

The next day, Eugene Flannery, an Environmental Compliance Manager in the Mayor’s Office of Housing and Community Development, responded indicating his office needed to consult with other City departments before it could respond. On January 13, Flannery finally provided an initial list showing that of the 12 employees whose names had been drawn from a lottery, eight were firefighters, one was a Sheriff’s Department employee, and three were police officers, but he neglected to include any information loan amounts awarded.

Flannery withheld the names of the City employees who applied for, qualified for, or were awarded assistance under the DLAP program. He claimed that for reasons of privacy, the City closely guards employee’s home addresses and the “general rule” is that the City does not disclose them to the public, ignoring the fact that the records requested had not asked for home addresses.

[This is notable, since later, on March 19, Flannery finally released the non-first responders DLAP manual, which clearly stipulates that the names of DLAP recipients are public records, and the loan applications and all communications involved with the Mayor’s Office of Housing concerning the loans, are disclosable public records.]

On January 22, Flannery provided a second version of his list, which indicated two of the “firefighters” are actually paramedics, and then included loan amounts. Shockingly, of the $1 million set aside for the first-responders DLAP program for July 2013 to June 2014, a total of just four loans had been issued as of January 13, 2014, seven months into the fiscal year. The four loans totaled $393,750, representing just 39 percent of the $1 million initially set aside in the program’s first-year budget. The four loans represent just two percent of the full $20 million appropriated to the Housing Trust Fund on July 1, 2013.

And notably, the non-first responders DLAP component had also been budgeted $1 million for FY 2013-2014, but as of March 2014 — nine months into the current fiscal year — the program had not even launched and ostensibly had no applicants (even from nurses or 9-1-1 dispatchers), and no awards had yet been made from the second $1 million DLAP program for non-first responders. It took the Mayor’s Office of Housing over 16 months to develop and issue the non-first responders DLAP manual between the time Proposition “C” was passed in November 2012 and when the manual was released in mid-March 2014. Wasted time during which no non-first-responder loans were offered, or issued.

On January 13, Flannery had responded to a first records request, saying that only 12 people had applied for the first responder DLAP loans, which came nowhere near close to the 45 public safety personnel the Chronicle had reported in July 2013 were “interested in applying.” Flannery indicated four of the loans had closed; six were “allocated” funds, but had ostensibly not been able to “secure” a property and asked for and were granted extensions to accommodate their search for a home; and two were on some sort of waiting list. He indicated that when the extension period ended, applicants unable to secure a property would be removed from the reservation list and the freed-up slots would be made available on a first-come, first-served basis, with the two applications on the waiting list given priority over new, interested households.

[Editor’s Note: Mayor Lee issued a press release on March 17, saying in part, “However, given the high cost of homes in today’s market, a higher loan amount is need [sic] to enable low to moderate income [sic] borrowers keep up with market conditions.”

The Mayor’s press release also said the first responder’s DLAP component had funded four loans “totaling nearly $500,000, with six other loans in process to close in 2014.” First, the $393,750 issued as of late January for the four loans approach nearly $400,000, not the $500,000 bloviated.

Second, as of late January, Flannery had indicated the remaining six loans in process may not close before the end of June 2014. Assuming those loans close at all, they may not occur in the fiscal year intended, but may be rolled over into the first two quarters of a subsequent fiscal year. This suggest there may be some slippage to the timelines and goals for each fiscal year.

Alternatively, if the six loans don’t close by June 30, 2014 in the first fiscal year these first responder DLAP loans were appropriated, they may simply be rolled over into a subsequent fiscal year’s budget, making them more difficult to track across funding cycles.]

When asked on February 1 how his office would identify other employees who might potentially want to bid on the vacated or unused lottery drawing, Flannery started clamming up. He indicated two days later on February 3 that his office would make announcements regarding the remaining down payment assistance in the first-responders program in March. Here we are at the end of March, and it’s unknown whether any new announcements have been pushed out to potentially-eligible public safety or first responder staff.

Flannery did provide a sample notification letter, but creatively failed to answer a follow-up question about who the sample letter had been sent to, or when. And he creatively claimed a day later on February 4 that there were “no responsive records” to a request for a “waiting list” of those who sought first responder loans in FY 2013-2014. First, Flannery used the term “waiting list” several times in January. Then he said in February no waiting list exists. Which is it? He hasn’t explained.

When asked for program manuals for the overall Down Payment Assistance Loan Program required by Charter Section 16.110(d)(2) following passage of Prop. “C” in 2012, the manual for the “Housing Stabilization Program” required by Charter Section 16.110(d)(3), and any another other program manuals or policies and procedures for the Neighborhood Infrastructure Grant Program and the Affordable Housing Development program, Flannery provided four documents on February 14: A “Cal Homes” policies and procedure manual, a “Healthy Homes” write-up, a “Single-Family Tenant-Occupied Loan Program” write-up about providing affordable financing to rehabilitate one- to four-unit properties occupied by low- and moderate-income tenant households, and the first-responders DLAP manual.

While the Healthy Homes and rental rehabilitation programs are two of the 10 separate program components within the “Housing Stabilization Program,” Flannery provided no other information regarding the other eight sub-components, and it appears that despite the 16 months since Prop. “C” passed in 2012, an over-arching manual for all 10 components of the Housing Stabilization Program may not have been developed yet, despite the Charter’s requirement.

As far as that goes, Flannery provided no manual for the Complete Neighborhood Infrastructure component, or the Affordable Housing Development component of the Housing Trust Fund.

And Flannery provided no “manuals” or procedures regarding stabilizing at-risk rent-controlled units, or the Mayor’s plan announced two weeks earlier during his State-of-the-City speech on January 17 promising to build only market-rate rental units. What? No procedures to help “affordable” or low-income renters at all?

Initial Two-Year Housing Trust Fund Budget

To his credit, Mr. Flannery did provide the two-year Mayor’s Proposed Budget for use of the Housing Trust Fund in FY 2013-2014 and FY 2014-2015 authored by the Mayor’s Office of Housing and Community Development. It paints a disturbing picture.

It shows that for the first year, just $2 million — just 10 percent of the initial $20 million diverted to the Housing Trust Fund — would be split equally between the separate first responders and non-first responders DLAP program components. The Housing Stabilization sub-program was budgeted to receive 14.1 percent, or $2.8 million. The Neighborhood Infrastructure program was budgeted to receive just one percent, a paltry $200,000. “Program delivery” — ostensibly including personnel, “overhead,” and legal expenses — fared much better, at 5.8 percent, or $1.15 million of the initial $20 million.

Shockingly, fully 69 percent — $13.8 million — was budgeted for “affordable housing development,” the same Affordable Housing Development component for which Flannery provided no program manuals or write-ups. Nobody has explained what the Affordable Housing Development component will do — or how over two-thirds of the first $20 million deposited into the Housing Trust Fund in July 2013 will be used.

When the City starts kicking in the additional $2.8 million in FY 2014-2015 on July 1, 2014 in the second year on top of the first $20 million required by Prop. “C,” the allocation to each major sub-component shifts, ever so slightly. The non-first responders budget will double to $2 million (at the same time the initial two–year budget provides no increase to the $1 million set aside for first responders which will remain at a flat $1 million), so both DLAP components will rise to 13.2 percent of the $20.8 million; funding to the Housing Stabilization program will see a modest increase of just $300,000, dropping it to just 13.6 percent of the mix; the Neighborhood Infrastructure funding will quintuple from just $200,000 to a full million, jumping to 4.4 percent; and the Affordable Housing “Development” component will see a $700,000 increase to $14.5 million, but will drop to just 63.6l percent of the second-year budget.

Across the first two-year budget of $42.8 million for all uses of the Housing Trust Fund, this brings us to a two-year combined total of:

A mere $5 million across both DLAP programs ($2 million initially budgeted for first-responders, and $3 million for non-first responders), representing 11.7 percent of the initial two-year budget.

An also-paltry $5.9 million — 13.8 percent of the initial $42.8 million — for the so-called Housing Stabilization” program component.

Just $1.2 million — 2.8 percent of the initial $42.8 million — for the “Complete Neighborhoods Infrastructure Improvements” component.

A staggering $28.3 million — 66 percent of the initial $42.8 million — for the so-called “Affordable Housing Development” component, with no explanation whatsoever of what the Mayor’s Office of Housing intends to use those millions for, when, and with whom.

[Editor’s Note: Just before the Westside Observer went to press for this issue, Flannery provided the second two-year Housing Trust Fund proposed budget for Fiscal Years 2014-2015 and 2015-2016, too late to fully analyze for this article. It shows however, that in the third year of the Housing Trust Fund’s existence, the Mayor’s Office of Housing had proposed awarding the “affordability housing development” component another $14.87 million, while the Controller’s Office also provided an apparently revised budget for the same period showing an increase for the “affordability housing development” component to $17.3 million — bringing the three year total for affordability housing development use to an even more staggering $45.6 million, with no explanation for its use.

Rocky Road of Performance

Data from the City Controller’s Office and the Board of Supervisors Budget and Legislative Analyst — Mr. Harvey Rose’s outfit — paint a troubling picture of the Mayor’s Office of Housing and Community Development.

In response to a records request placed with the City Controller, it turns out that as of February 18, 2014 fully 92.8 percent — $17.5 million — of the total $20 million transferred from the General Fund to the Housing Trust Fund for its first year of funding remains unencumbered (unspent) fully nine months into the current 2013-2014 fiscal year.

Of the $1.15 million set aside for program delivery including personnel and legal expenses to administer the Trust Fund, fully 86 percent — $991,797 — remains unencumbered nearly nine months into the current funding cycle.

More shockingly, of the $20 million diverted from the General Fund to the Housing Trust Fund, the City Controller’s data shows that either the Board of Supervisors, the Controller’s Office, or the Mayor’s Budget Office had tinkered with the Mayor’s Office of Housing and Community Development’s proposed budget submission for FY 2013-2014 by moving $1 million from loan assistance programs to “community-based organizational services.” The Community-Based Service budget line item has encumbered about 42 percent of its revised budget to date in the fiscal year (after the Board of Supervisors tinkered adjusting its budget), the sole program to have encumbered a significant portion of its budget.

Which “community-based services” may have been recipients of this encumbered largesse, is not yet known.

But it stands in stark contrast to the Controller’s data that shows not only that the line item index code for “loans issued by the City” was reduced from $17.8 million to just $16.8 million, with the reduced $1 million apparently moved to “community-based services,” but also that $16.4 million of the remaining $16.8 million for loans “issued by the city” remains unencumbered, fully 97.6 percent of the funds the Controller said had been budgeted for “loans.”

Not explained by the Controller’s Office is why the Mayor’s Office of Housing may have submitted a proposed budget listing five separate main components of the Housing Trust Fund, but the Controller’s “index codes” for FY 2013–2014 and FY 2014–2015 contained just two major categories for “community-based organizational services,” and “loans issued by the City,” as if “neighborhood infrastructure” and “affordable housing development” projects have no separate index code to track their programmatic costs and can just be lumped together in a single index code apparently labeled “loans issued by the City.”

[Editor’s Note: Just after this article was submitted to the Westside Observer for publication, the Controller’s Office provided an updated two-year proposed budget for the Housing Trust Fund for FY 2014–2015 and FY 2015–2016. It now provides separate breakouts for the two categories for contracts for Community Based Organizational Services (the “Complete Neighborhoods Initiative” and the “Housing Stabilization Program”), and now lists four separate breakouts for the various categories of loans (including the “First Responders DLAP,” the non-first responders DLAP, a new “Housing Development Pool” and a “Small Site Acquisition/Rehab Program”). The “Housing Development Pool” loans — which Flannery provided no program description of — continues to receive the lion’s share of funding, at $14.5 million in FY 2014–2015 and $17.3 million in FY 2015–2016.]

And the Controller’s Office hasn’t explained whether the $13.8 million requested in the Mayor’s Office of Housing’s proposed budget earmarked for “Affordable Housing Development” in the first year (FY 2013–2014) has been rolled into a single line item for $16.4 million for “loans issued by the City.” The November 2012 voter guide made no mention of using any portion of the $20 million Housing Trust Fund for “Affordable Housing Development,” but here we have the Mayor’s Office of Housing’s budgeting $13.8 million in the first fiscal year towards that purpose, while the City Controller’s Office may have lumped any such expenditures into an index code designated as “loans.”

Affordable Housing Development “loans”? To whom are these loans being shopped to? No explanation has been forthcoming from Flannery, or his boss Olson Lee.

If the $13.8 million in “affordable housing development” loans in FY 2013–2014 are not being disbursed to either first-responder or non-first responder loan applicants, who are the “loans” being awarded to? Or will that money just be rolled over into a subsequent fiscal year and spent later?

Mr. Flannery, and his boss Olson M. Lee (not a relative of Mayor Ed Lee), aren’t saying. And they haven’t provided a program manual or write-up describing any program to underwrite “affordable housing development” loans, terms of such loans, repayment provisions, or qualifications required to even apply.

Comparing the Mayor’s Office of Housing’s Proposed Budget for the Housing Trust Fund against the City Controller’s line-item index codes, reveals a host of unanswered questions.

Take, for example, public records obtained from both the Mayor’s Office of Housing and the Controller’s Office after this article was submitted for publication.

Different public records show that for the two-year budget cycle for FY 2014–2015 and FY 2015–2016 now being hashed out at City Hall for adoption July 1, 2014, that although the Office of Housing had requested $14.87 million in FY 2015–2016 for the so-called “Affordable Housing Development” component, the City Controller’s Office is now showing that component has been increased to $17.3 million, a $2.4 million increase over what had been requested by the Housing Office.

To do that, the City Controller’s data is reporting the requested $2 million in the second year for the “Neighborhoods Infrastructure” has been reduced by half, to $1 million. Similarly the City Controller’s data shows that the $3 million requested for “Small Site Acquisition/Rehab” has been reduced by one-third, to $2 million. Overall, the Controller’s data shows the “Housing Stabilization” component has been reduced from the requested $4.45 million to $3.1 million, with the difference being squirreled away to fatten up “Affordable Housing Development,” which will apparently take the form of “loans,” but loans to whom, when, and for what purpose remains unexplained by Flannery and Olson Lee.

Again, it’s unclear whether it was the City Controller, the Board of Supervisors, or the Mayor’s Budget Office that moved funds around in the Mayor’s Office of Housing’s proposed budget.

When Harvey Rose Speaks, People Listen

In a development unrelated to the Housing Trust Fund per se, but closely related to the “affordability crisis” that has resulted from Mayor’s Lee’s focus on luring tech sector “jobs,” and that has resulted in massive displacement in San Francisco, Harvey Rose — the Board of Supervisors Budget and Legislative Analyst — has weighed in, however unintentionally, on performance of the Mayor’s Office of Housing and Community Development.

In February 2014, Rose submitted an analysis to the Board of Supervisors who were considering a $2 million increase to an initial proposal to divert $2.5 million from the City’s General Fund Reserve account to fund a new “Non-Profit Rental Stabilization Program,” increasing the proposal to $4.5 million.

Rose noted such a decision might be premature, since the criteria for awarding stabilization funds to individual nonprofit organizations, any limitations on use of the funds, limits on the amount of funds to be awarded, and “administrative and selection procedures” had not yet been decided, and won’t be until after a planned report from a so-called “Nonprofit Displacement Work Group” is completed and presented, presumably on April 11, 2014.

Rose claimed it was simply a “policy matter” for the Board to consider increasing the raid of the General Fund Reserve account, reducing General Fund reserves from $44 million to just $40 million, which the San Francisco Examiner later creatively titled a news article as being a “gift” to the City, albeit being a raid of the City’s reserve coffers, not a philanthropic “gift.”

Rose claimed this, after first admitting that way back in 2000, the Board of Supervisors had approved two ordinances to appropriate $1.5 million from the City’s General Fund Reserve to provide rent subsidies to nonprofit arts organizations in immediate danger of being evicted or displaced by rent increases.

Rose reported on February 26, 2014, that the Mayor’s Office of Housing and Community Development claims overall expenditures, including administrative costs of the arts rental assistance program, are “not currently available.”

Wait! What? The Mayor’s Office of Housing has no information available at all about how $1.5 million may (or may have not) have been spent?

Apparently, Mr. Brian Cheu, Director of Community Development in the Mayor’s Office of Housing and Community Development advised Rose’s team that “approximately” 12 grants for rental subsidies were provided under the arts rental assistance program during an unspecified time frame. More apparently, “approximately” was as close as Cheu could get, which Rose appears to have accepted and the Board of Supervisors appear to have later swallowed at face value.

A million-and-a-half dollars vanishes, and nobody knows where?

Rose’s report provided to the Board of Supervisors noted that Mr. Cheu in the Mayor’s Office of Housing and Community Development advised Rose that there was also “no information” about the $500,000 portion of the rent subsidies to nonprofit service and advocacy organizations. How’s that for empty (as in bloviated) record-keeping?

Surprisingly, Rose uncharacteristically included in his report a damning statement, saying, “… such that it appears that the City may have never implemented this portion of the program.” Really? No implementation? And no records? Where’s the money?

With record keeping like that in the Mayor’s Office of Housing and Community Development, what else are they declining to disclose — or hiding? Perhaps its director, Olson M. Lee, knows.

More “Office of Housing” Nonsense

As recently as March 17, Mayor Ed Lee’s director of the Mayor’s Office of Housing, Olson M. Lee, was quoted in a San Francisco Chronicle article saying that the Mayor’s doubling of the down-payment assistance loans to $200,000, from $100,000 would be “a lot more helpful.” Olson Lee was reportedly referring to market-rate housing.

For the first time, we have an admission via the Chronicle that the loans appear to be reserved for buyers of “market rate” homes, not “below market rate” or “affordable homes” buyers, and then only for those earning up to 120 percent of AMI.

A San Francisco Examiner article March 17 noted Mayor Lee had proposed a $15 million increase in “new contributions” from the city’s “main spending account” [would that be the City’s General Fund?] should be added over the next five years, ostensibly to the non-first responders DLAP funding.

After the Examiner reported that the maximum DLAP award would be increased to $200,000, and that $15 million in new contributions might accrue to the Housing Trust Fund, imagine this tenacious reporter’s surprise after placing yet another records request.

Asked whether the proposed number of loans to be issued would be reduced from ten $100,000 loans to only five $200,000 loans, MOHCD director Olson Lee again clammed up, allowing Flannery’s non-answers to go unanswered a second time.

[Editor’s Note: Notably, Mayor Lee’s March 17 press release contained spin control over the doubling of DLAP loans to up to $200,000 each loan, up from the first year’s $100,000 loan limit. It appears the increase to $200,000 loans may well reduce the total number of loans to first responders from ten a year, to just fivc.

The Mayor’s press release claims that in the first five years of the DLAP program for first responders and non-first responders “will help at least 100 households buy their first home.” On close examination, the press releases’ bloviated claim falls apart.

To date during the first year of the first responder loan program, just four loans have actually closed.

Because the second and third years of the first responder DLAP component remain flat-funded at $1 million annually, but the loan ceiling is raised to $200,000, this may portend that with the increase to $200,000 loans, only five loans annually may happen in Year 2 and Year 3, not the ten loans anticipated at $100,000.

If Year 1 yielded just four loans, and Years 2 and 3 net five loans at $200,000 each year, that gets us up to a not-too-staggering 14 loans, just for first responders.

Assuming Year 4 and Year 5 also stay flat funded at $1 million each year for first responders, perhaps another 10 loans may be made by the end of Year 5 (but don’t bet on it), bringing the total to 24 loans for first responders over the initial five-year period.

Turning to the DLAP component for non-first responders, the Mayor’s Office of Housing and Community Development dawdled for the first year, and it only belatedly launched the non-first responders DLAP program in March 2014. It’s unlikely that any loans for non-first responders will close in the next three months before the end of the current fiscal year.

For the second and third years, the non-first responder’s DLAP proposed budget stands at $2 million each year, suggesting a total of twenty $200,000 loans may be made across Year 2 and Year 3 (ten loans in each year). If Year 4 and Year 5 also stay flat-funded at $2 million each year, another twenty $200,000 loans may be issued to non-first responders. If that happens, it may bring the total of non-first responder loans to just 40 loans.

Between the first responders and non-first responders, that may bring the toal DLAP loans across five years to just 64 — not the 100 loans blabbed about in the Mayor’s March 17 press release.

Unless the Mayor starts using bloviated fish-and-the-loaves, he stands no chance that 100 DLAP loans will be issued in just five short years, as his March 17 press release misleads the public.

After all, the Mayor’s March 17 press release indicated that between the first responders DLAP program and the non-first responders DLAP program, it would help “at least 100 household buy their first home” within the next five years.

Let’s do simple math. One hundred households who could each qualify for $200,000 would require the Housing Trust Fund to have $20 million available in these two DLAP component budgets during the next five years.

In Years 1 through 3, only a combined total of $8 million for DLAP loans has been presented in proposed budgets, which are headed towards being appropriated (raided from the General Fund) across both DLAP components. If the Mayor really expects to divide the fish-and-loaves, he’s going to have to come up with another $12 million in Year 4 and Year 5 to reach a $20 million goal for the DLAP loans.

This probably isn’t going to happen, because in Years 2 and 3, only $3 million has been allocated across both DLAP components. If Years 4 and 5 are flat-funded at the current $3 million level each year, Mr. Mayor is likely to be short-sheeted $6 million of the needed $20 million.

Unless Google and Twitter — and airBnB, Uber, Lyft, and “Tech Inc.” — stop donating money to fund free MUNI rides for kids, and start kicking in “corporate giving” towards helping out the Mayor’s troubled DLAP program to help solve the housing problem that has resulted from the Mayor’s focus on “jobs, jobs, jobs” — mostly “tech” jobs.

Asked of Olson Lee on March 18 whether the Examiner’s article was reporting a new $15 million increase over and above the already-pledged $20 million-plus annual allocation increases, or whether the so-called “new” $15 million increase is simply the same dollar amount increase of $2.8 million previously authorized to be accumulated during the same five-year period, Flannery inappropriately answered with a one-word “No,” to what was an either-or question.

So it was unclear whether the Mayor plans to add $15 million to the Housing Trust Fund in new money beginning July 1, 2014 beefing up the pot, or whether his social media spin meisters are merely double-counting the annual $2.8 million increase in each of the next five years already required by Prop. “C” that will yield almost the same $15 million.

When Olson Lee was asked about Flannery’s inappropriate answer of “No” to a clear either-or question, Mr. Lee had his deputy, Maria Benjamin, Director of Homeownership and Below-Market Rate Programs, reply on his behalf.

Ms. Benjamin further clamed up, saying that the Brown Act, California’s Public Records Act, and Proposition 59 — and by extension, San Francisco’s Sunshine Ordinance — only require public agencies to provide existing documents. Not explanations.

In other words, Ms. Benjamin, Mr. Flannery, and Mr. Olson Lee collectively appear to be unwilling to simply answer either-or questions, implying they will produce only specific documents requested, not any explanations to specific questions involving elaboration about the Housing Trust Fund.

But the second two-year Housing Trust Fund budget this columnist received just as the Westside Observer was going to press for this edition, shows that through Fiscal Year 2015-2016 there is no new portion of a $15 million increase in the next two-year budget, suggesting that the $15 million increase being creatively spun as “new money” by the Mayor’s press staff is actually the same pot of money from the $2.8 million increase times five years already budgeted.

So much for the “trust” side of the “in the public trust” equation.

Instead, we appear to have an Office of Housing and Community Development hell bent on hiding from the public, just how it is spending hundreds of millions of dollars meant to spur affordable housing development.

Housing in the Wild, Wild West

Although the mainstream media have reported Mayor Lee wants to issue up to 2,500 down-payment assistance loans of up to $200,000 each loan over the next six years — which may require funding as high as five-hundred million (yes, a half-billion in “loans” — nobody’s talking about the fact that issuing just four loans per year (as the City did in the first year of the program), it will take 2,500 applicants a total of 625 years to perhaps receive loans, given the glacial speed of the Mayor’s Office of Housing.

Bumping it up to even forty $200,000 loans per year will take the Mayor’s Office of Housing a full 62.5 years to issue 2,500 loans, not six years. After all, if the Mayor really plans to issue 2,500 down-payment-assistance loans during the next six years, his Office of Housing will need to process, approve, and issue 417 loans each year, not four each year.

The Mayor would have to quickly come up with $500 million within six years that he hasn’t explained to the electorate where such inflated spending will come from. And he may have to explain why the mainstream media have been reporting that DLAP loans appear to be restricted only to market-rate homes.

The Mayor’s Seven-Step Plan reported in the media in January claims that 30 percent of the total housing goal would be reserved for lower-income residents, for example a family of four earning less than $50,000 annually. There’s no mention in the program manuals provided by Flannery that the Housing Trust Fund will dedicate 30 percent of its total funding for four-person households earning less than $50,000 annually.

The media also reported in January that 25 percent of Lee’s Seven-Step Plan housing goals targets middle income families of four earning between $100,000 and $150,000.

That brings the lower- and middle-income beneficiaries to just 55 percent of the housing goals. Creatively, the major media made no mention of the remaining 45 percent of the housing goals in Lee’s Seven-Step Plan.

Presumably, fully 45% of the remaining housing goals will be targeted to four-person (or other) families earning more than $150,000 annually, presumably to upper-income residents.

In fact, there’s no mention at all in the documentation Flannery provided — and no mention in the enabling legislation in the legal text of Proposition “C” passed by voters in 2012 — on how the Housing Trust Fund may be permitted to split percentages between lower-, middle-, and upper-income residents.

Five years ago, the San Francisco Bay Guardian carried a story titled “Lennar’s housing scam, redux,” reporting misrepresented promises by Lennar to build 32 percent affordability into its 10,500 homes being built in Bayview Hunter’s Point. Observers noted back then that the main rationale for building so much market-rate housing is callously for the property taxes they will bring to the City’s coffers.

This reporter also noted back in 2009 that there was nothing in the legal text of the 2009 Proposition “G” ballot measure awarding Lennar the development rights in the Bayview that guarantees any precise percentage of housing that will be designated as “affordable.” Indeed, Lennar’s development plan for Parcel “A” in the Bayview had initially promised low-income rental units. Lennar single-handedly changed the composition of the first 1,600 units to be built, all of which will be at market rate — with no low-income rental units. We’ve been warned: Lennar may end up building only market rate units.

The first 1,600 units are expected to each sell for San Francisco’s then median price of $836,000 in 2008 dollars. That will net Lennar $1.38 billion in homes and condos on Parcel A. Every day of delay by Lennar is designed to drive up the median prices of housing in order to increase Lennar’s profits.

Given apparent early failures of the Mayor’s Housing Trust Fund, one wonders whether the Bay Guardian might now, five years later, write another article, perhaps titled “The Mayor’s housing scam, redux.”

After all, the 2012 voter guide indicated that the Housing Trust Fund would include “uses” for rental housing. Given that approximately 64 percent of San Franciscans are renters, it’s troubling that the Mayor’s Office of Housing and Community Development’s first-year proposed budget for FY 2013–2014 and FY 2014–2015 included just $200,000 (or of $20 million) for rental eviction defense, and nothing from the Housing Trust Fund itself for rental unit rehabilitation. In the second year in FY 2014–2015, the Housing Trust Fund is budgeting to add $200,000 for rental unit rehabilitation, and will double that to $400,000 in FY 2015–2016.

Adding the $600,000 the Housing Trust Fund has budgeted for rental eviction defense across the three-year budget periods between FY 2013–2014 and FY 2015–2016 to the total of $600,000 budgeted in the second and third years for rental unit rehabilitation, the Housing Trust Fund appears to have budgeted just $1.2 million — just 1.75 percent — for any sort of rental assistance, out of the total $68.4 million that will be appropriated during the first three years of the Trust Fund budgets. In a City where over 64 percent of the residents are renters.

Despite City Hall’s bleating that the Mayor would beef up rental eviction defense funding (following the 2013 Ellis Act eviction of Poon Heung Lee and Gum Gee Lee and their disabled daughter debacle), the eviction defense and prevention budget in the Housing Trust Fund’s budget appears to be flat funded at $200,000 in each of the first three years. How many more Poon Heung and Gum Gee Lee evictions will there be, before the eviction defense fund is actually beefed up, not simply flat-funded?

This is despite a San Francisco Examiner article in October 2013 that Mayor’s Office of Housing had increased funding for tenant counseling services “by 63 percent, to $700,000, bringing the total to more than $2.3 million in eviction prevention services.” How do you inflate just $600,000 in Housing Trust Fund monies in public-record budgets for renter assistance programs, into $2.3 million? Is this more bloviated bread and fish, and infused wine?

Playing Voters for Suckers

Typically, San Francisco voters are a pretty savvy group. Voters appear to have been snookered in 2012.

After all, we passed a ballot measure in March 2002 creating the Citizens General Obligation Bond Oversight Committee to monitor use of hundreds of millions in general obligation bonds earmarked for a variety of capital infrastructure improvement projects. Voters also passed the same year in November, a measure creating a Revenue Bond Oversight Committee to monitor issuance of Revenue Bonds for the San Francisco Public Utilities Commission, given the billions at stake in various Hetch Hetchy, water system, and sewage system projects.

Although both oversight committees created in 2002 have had only marginal success, riddled with political appointees to both bodies, there is at least a perception of oversight. Not so with the Housing Trust Fund, which has no oversight.

Voters were played for suckers when Proposition “C” was put before them creating the Mayor’s Housing Trust Fund. Without clearly being advised that the Housing Trust Fund would be managing upwards of $1.3 billion for a whole host of housing programs, voters weren’t offered any opportunity to have an Oversight Committee established to monitor use of the Housing Trust Fund. Not only do voters have no oversight of use of the Housing Trust Fund, they also have no oversight of the $1.34 billion in cuts that will be made to the City’s discretionary General Fund that will then be diverted to fund the Housing Trust Fund.

On January 17, the major media reported the Mayor claimed in his State-of-the-City address that 2,500 DLAP loans would be issued within six years — $500,000 million not even remotely available in his bank. Following numerous public records requests placed about the DLAP programs in January and February, Hiz Honor now seems to have changed his tune.

Just three months later, Mayor Lee’s March 17 press release reduces DLAP loans to just 100 loans over five years — not 2,500 — still unsure whether he even has $20 million in this bank to cover such a commitment of funds.

Did Flannery, Olson Lee, or someone else at City Hall suddenly realize that bloviating 2,500 loans was just too far over the top, even using spin control, and that’s when they de-blovitated expectations by re-christening 100 DLAP loans as the new 2,400 DLAP loans three months later?

This just adds insult to injury, since not only have voters been excluded from overall decision-making on how the Housing Trust Fund’s money will be spent, they also appear to have been excluded from any decision-making regarding who the eligible applicants will be. They’ve also been excluded from any decision-making regarding how the trust funds will be split between low-, middle- and upper-income applicants, among other decision-making exclusions.

Although we’re told checks and balances of our government are necessary to defend our democracy, there’s no provision of any sort of checks-and-balances over this Housing Trust Fund. How do you provide the citizenry with trust regarding Housing Trust Fund trustees, when there are no checks or balances over the trustee’s decision-making?

If I were a betting man, I’m not convinced I’d wager the Mayor’s seven-point “housing affordability” plan will come to fruition. P.T. Barnum — or whichever con man came up with the aphorism — provided fair warning about not being played for a sucker.

Monette-Shaw is an open-government accountability advocate, a patient advocate, and a member of California’s First Amendment Coalition. Feedback: monette-shaw@westsideobserver.com.

April 2014

City Attorney's Attack on Public Records Law

Sandbagging, Legal Fairy Dust, and Double-Speak

West Side residents are increasingly concerned about the City Attorney Office's disregard for San Francisco's public records Sunshine Ordinance, as are all San Franciscans. City Hall's machinations affect the West Side as disastrously as they do the rest of the City.

Attorney Allen Grossman receiving the award from the Society of Professional Journalists
Allen Grossman receives the Society of Professional Journalist's Award

Consider the City Attorney's conclusion in the recent settlement of lobbying violations by former Board of Supervisor Michael Yaki. While City Attorney Dennis Herrera wanted to send "a strong message that the San Francisco Lobbyist Ordinance has teeth,"
the machinations of Herrera and his team to remove the teeth in San Francisco's Sunshine Ordinance is extremely troubling. It's total double-speak.

Readers may also recall the scandal of the raid of Laguna Honda Hospital's (LHH) patient gift fund. Multiple public records requests uncovered that $350,000 in the patient's gift fund had been inappropriately diverted to fund staff perks. The hospital was eventually forced to reimburse the misappropriated funds.”

San Franciscans should be alarmed that the City Attorney's Office has appealed the Superior Court ruling in Allen Grossman v. John St. Croix, Executive Director, San Francisco Ethics Commission; and the Ethics Commission to the Appellate Court. The City's appeal aggressively seeks to strike down one or more key sections of our local open government Sunshine Ordinance. Apparently with City Attorney Herrera's blessing.

What follows is a discussion of the 222 pages of legal briefs filed to date in Grossman's case, and another 50 pages of open records regulations in our local Sunshine Ordinance and California's Public Records Act. Two final briefs —
one from each party to the case — had been scheduled to be filed in Appellate Court on February 21 and March 10. But on February 19, the City requested yet another three-week delay. The two final briefs are now due on March 7 and March 31. We'll be watching.

A number of recent issues facing West Side residents were exposed from public records requests placed by members of the public. Westside Observer readers may recall our coverage of the difficulties that George Wooding faced when he sought obtaining public records from the Recreation and Parks Department. Wooding is president of the Midtown Terrace Homeowners Association. Wooding's subsequent Sunshine complaint was inappropriately dismissed by the Ethics Commission.

Readers may also recall the scandal of the raid of Laguna Honda Hospital's (LHH) patient gift fund. Multiple public records requests uncovered that $350,000 in the patient's gift fund had been inappropriately diverted to fund staff perks. The hospital was eventually forced to reimburse the misappropriated funds.

Or consider the long-running dispute homeowners living on Dellbrook Avenue behind LHH faced regarding the ear-splitting external fire alarms on the roof of LHH's new buildings pointed directly at their homes. Their fight against the City involved several Sunshine records requests. Observer readers may also recall our coverage of West Side resident Rita O'Flynn's long-running legal dispute involving the City's deeply flawed lead-based paint remediation program. O'Flynn exposed the program's flaws following multiple public records requests.

Long before the feel-good Bat Kid flew in to San Francisco to save Gotham-by-the-Bay from its own devices, forces of darkness from our own City Attorney's Office had long sprinkled the City with legal fairy dust. Unfortunately, the chocolate Key-to-the-City that Mayor Ed Lee presented to the Bat Kid couldn't unlock the City's doors of secrecy. Doors slammed shut by Herrera and his staff. Then bolted for good measure.

Herrera has served for 11 years as City Attorney. He just won unopposed reelection. We're stuck with him for another four-year term, just as we had been stuck with his predecessor, Louise Renne, for 16 years when she served as City Attorney between 1986 and January 8, 2002. Just two City Attorney's over a 31-year period?

In the introduction to a so-called "Good Government Guide" written by Herrera for City department heads and senior managers, Herrera somewhat ironically quoted Franklin Knight Lane, San Francisco's City Attorney a century ago, from 1899 to 1900. Lane wrote, "No man should have a political office because he wants a job. A public office is not a job. It is an opportunity to do something for the public. And once in office, it remains for him to prove that the opportunity was not wasted."

Herrera ended his Good Government Guide introduction reminding employees "a public office is a public trust." He noted employees have a responsibility to conduct government functions in ways that are honest, open, and responsive to the citizens. But a cloud of legal fairy dust hangs over Herrera's leadership. His pattern of government secrecy, coupled with clear disregard of public records law, is troubling.

The City's appeal to overturn Grossman's Superior Court Sunshine victory represents an assault on our Sunshine Ordinance. Herrera suddenly wants a key provision of it struck down. Is this a sign Herrera is proving his opportunity to serve the public has been entirely wasted?

Desperate to Stop Grossman's Victory

As the Westside Observer reported in "Four Major Sunshine Victories" in our December–January issue, long-time open government advocate Allen Grossman — a Harvard University Law School graduate — obtained his second Superior Court victory against the Ethics Commission and its Executive Director, John St. Croix. Superior Court Judge Ernest Goldsmith ruled in Grossman's favor on October 25. Goldsmith ruled St. Croix and the City failed to meet their burden proving that records improperly withheld from Grossman are exempt under either the Sunshine Ordinance or California's Public Records Act (CPRA).

That should have ended the dispute. St. Croix should have produced the 24 improperly withheld records. He didn't.

The Observer reported in December that Deputy City Attorney Andrew Shen's 20-page Respondents Opposition to Petition for Writ of Mandate, filed on behalf of the City on October 9, 2013 was the worst legal filing this columnist ever had the displeasure of reading. The brief began by indicating Grossman's case "raises the question of whether a municipality's voters acting in their legislative capacity may, by ordinance, override the laws of attorney-client privilege and work product doctrine set forth in state statues and rules of professional conduct incorporated into a City charter." Of course voters can. Shen's brief went quickly downhill from there.

City's "Tip Toe Through the Tulips" Appeal

But that was before reading Shen's 42-page Petition for Peremptory Writ of Mandate and/or Prohibition filed in Appeals Court on November 22. It's even worse reading. The appeal — sprinkled with another heavy dose of fairy dust — attempts to overturn Grossman's Superior Court victory.

The subject matter of Grossman's records request — drafts of Ethics Commission procedural regulations that were being vetted as a legislative function, and the City Attorney's views on various draft provisions — epitomizes the type of legal advice that does not depend on confidentiality. Drafting of procedural regulations is akin to a legislative function. Shen knows this, or should. So does Dennis Herrera. So does the Appeals Court.

But St. Croix, Shen, and Herrera are hell bent on keeping the City Attorney's advice concerning the draft regulations totally secret. So much for Herrera's claim public office is a public trust. So much for his admonition the people's business should be conducted in an honest and open manner.

Shen beats the same drum, more loudly. He repeatedly claims the City's principal argument against Grossman is that the 1999 Sunshine "Ordinance is invalid because it conflicts with the [City] Charter." Shen asserts that it is "beyond dispute that an ordinance cannot trump the provisions of a city charter, any more than a state statute can trump the California Constitution." He asserts that if voters wish to withdraw the attorney-client and attorney work product privileges, voters "may only do so by amending the [City] Charter."

Grossman's lawyer, Michael Ng, asserts there is no such conflict. Shen appears to be wrong on the "trumping" issue.

For starters, the Sunshine Ordinance was adopted by the Board of Supervisors as an Ordinance in 1993, presumably "approved as to form" by then-City Attorney Louise Renne. Among other things, "approved as to form" means that an Ordinance has been reviewed by the City Attorney to ensure it is not "unconstitutional" with respect to municipal law, including the Charter.

Voters then approved the "New City Charter" as Proposition "E" in the November 1995 election. Voters did so based, in part, on a summary comparing the then-current charter to proposed charter changes that appeared in the 1995 voter guide. The summary comparison was authored by the City Attorney's Office, presumably with Ms. Renne's approval. In the "General Format" section at the start of the summary, voters were told that [voter] initiative ordinances contained in Charter appendices would "still be part of the Charter," and that "any changes to … the appendices would still require a vote of the people." Voters were also assured in the comparison that Article XIV of the Charter dealing with voter initiatives, that there would be "no changes of substance" to voter initiatives. Voters were told only that a few of the provisions would be moved to the Administrative Code. Voters were not told Ordinances would lose their hierarchical standing.

Then in 1999 — while Renne was still City Attorney — voters passed Proposition "G," the "Sunshine Ordinance Amendment" by a 58.4% margin. The 1999 voter guide's Digest describing proposed changes clearly informed voters the amendments would:

Eliminate the City's claims of "public interest" as a sole basis for withholding records.

Prohibit the City from withholding records solely because they reveal the "deliberative processes" of City officials.

Prevent the City Attorney from giving confidential advice to City officers or employees on matters concerning city government ethics, public records, and open meeting laws.

Had the proposed Sunshine changes been so violative of the City Charter, why would prominent San Franciscans — such as then-Supervisors Tom Ammiano and Leland Yee, and former Supervisor Angela Alioto, who is an expert lawyer — have supported the ballot initiative? For that matter, why would former Mayor Frank Jordan; prominent socialite Martha Benioff, then co-chair of the League of Women Voters; and the Harvey Milk Democratic Club have supported the initiative? [Of interest, then-Supervisor Michael Yaki opposed the voters' Sunshine initiative. Did he oppose it because he was planning to become a paid lobbyist after leaving elected office and didn't want to face greater Sunshine?]

Had these proposed Sunshine Ordinance amendments so violated the City Charter, then-City Attorney Renne should have prevented them from being put before the voters when she reviewed the proposed initiative to assign its title and summary before signature gathering could begin. Renne could have tried to prevent them from being enacted as "unconstitutional" with respect to municipal law. She didn't do that. Retrospectively, Herrera now seeks to overturn some of the 1999 Sunshine improvements, a decade-and-a-half later.

After all, when a proposed anti-circumcision ballot initiative qualified with sufficient signatures to be placed on San Francisco's 2011 ballot three years ago, the City Attorney's Office quickly marched into Court and prevented the question from even being put before voters, claiming the proposed anti-circumcision ban would be unconstitutional.

The City Attorney's Office also prevented a citizen's initiative regarding development at the Bayview-Hunters Point that had qualified with more-than-sufficient citizen signatures to be placed on the ballot from ever making it to an actual ballot. When a City Attorney wants to stop voters at the ballot box, he or she can figure out ways to do so.

Were multiple sections of our Sunshine Ordinance in such constitutional conflict-with-the-Charter for a decade-and-a-half, the City Attorney could have — and should have — stepped in long ago to straighten out any such "trumping" problem. But he didn't. Probably because there was no cause. Now we get fairy dust, instead.

Shen asked the Appeals Court to issue a peremptory writ of prohibition to compel Superior Court Judge Goldsmith to set aside and overturn his ruling granting Grossman's victory. Shen continues to assert on behalf of the City that Sunshine Ordinance §67.24(b)(1)(iii) — which simply states that any City Attorney communications providing "advice on, compliance with, analysis of, or an opinion" concerning CPRA, the Brown Act, San Francisco's Ethics Code, or the Sunshine Ordinance are public records subject to disclosure — is "invalid because it is in conflict with the Charter." Shen asserts that the attorney-client relationship applies to all communications with clients.

Shen then takes a lemming's leap of logic. He asserts that if Grossman's argument is accepted, it could prompt future efforts to prevent the City from invoking attorney-client privilege on every other "subject [area]" beyond just access to City Attorney communications seeking advice on disclosure of public records.

Goldsmith's October 25 ruling denied the City's request to strike down §67.24(b)(1)(iii). Goldsmith's Order indicated that issue had not properly been brought before the Court. Shen's Appeals Court filing quibbles with Goldsmith, claiming in a footnote that the City's request to "strike" that Sunshine Ordinance provision "is not precisely accurate."

Shen is playing a silly game of semantics. He now claims the City had only argued that the Superior Court should not grant Grossman's writ that sought production of allegedly "privileged" documents, because the Sunshine provision "purporting to abrogate the [attorney-client] privilege is trumped by the Charter." This represents Shen's fairy tale.

Shen clearly wants 67.24(b)(1)(iii) struck down. But he's reluctant to admit that's his end game.

It isn't clear how Shen's hair-splitting makes anything more precise or accurate. It's not even clear that the charter "trumps" the Sunshine ordinance. What is clear, is that the City and Herrera now desperately want §67.24(b)(1)(iii) struck down, simply because Grossman appears to be the first San Franciscan to have sought enforcement of its provisions in a court of competent jurisdiction.

But §67.24(b)(1)(iii) did not, as Shen wrongly asserted, annul or repeal attorney-client privilege with respect to whether the City Attorney could issue written communications to its clients concerning advice on compliance with open government laws. Instead, §67.24(b)(1)(iii) only stipulates that any such legal advice to City officials are, by definition, public records that must be disclosed. It doesn't prohibit the City Attorney from anything or alter the City Attorney's duties. It just disallows withholding from disclosure records involving a single, narrow subject area: providing City Attorney "advice" regarding open government laws. It didn't abolish attorney-client privilege on a blanket basis, as Shen's fairy tale would have a Court believe.

Shen continued to wail and rail that the attorney-client privilege and attorney work product protections "are presumed to be an integral part of the City Attorney's functions prescribed in the Charter [emphasis added]." For Shen — and presumably his boss, City Attorney Herrera — presuming that something be read into the Charter that isn't actually there, is good enough.

Shen asserts several times that §67.24(b)(1)(iii) is "void" because it conflicts with the Charter. Although Shen notes Grossman is correct that local governments are authorized under CPRA §6253(e) to adopt public records laws that provide greater access to records than prescribed by the minimum disclosure standards set forth in CPRA, Shen argues that does not mean cities are authorized to contradict their charters by adopting a "mere ordinance" [such as the Sunshine Ordinance]. Shen concluded by asking the Appeals Court to reverse Judge Goldsmith's Superior Court ruling in Grossman's favor. Shen requested a Peremptory Writ on November 22, which are relatively rare and limited to situations where the Petitioner's [Shen's] "entitlement" to immediate relief is clear cut. Of significance, the Appellate Court — on its own motion — converted the Respondents' peremptory writ filing to an alternative writ, which converts the matter into a "cause" and which requires the Court to hear further arguments. Apparently, the relief Shen initially requested may not be so clear cut.

After wading through reading Shen's false nonsense, Tiny Tim's eerie falsetto, ukulele-accompanied smash hit, "Tip-Toe Through the Tulips," instantly came to mind. One can only pray that the Appeals Court also heard Tiny Tim's falsetto and ukulele rhythm in Shen's fairy tale appeal.

City's Improperly Filed Appeal

As the Observer reported in December, in response to the misguided and rambling Opposition brief Shen filed on October 9, Grossman's lawyer Michael Ng submitted a brilliant 14-page rebuttal Petitioner's Reply in Support of Verified Petition for Writ of Mandate in Superior Court on October 15. In it, Ng noted voters are the ultimate authority and can exercise plenary power over the City's legislative affairs. He also noted that it's clear Sunshine §67.24(b)(1)(iii) says City Attorney communications regarding compliance with open government laws — from the outset — are not confidential. Communications not confidential when created cannot be deemed attorney-client privileged after-the-fact.

In response to the brief Shen filed in Appellate Court on November 22 in the City's attempt to overturn Grossman's Superior Court victory described above, Ng filed a 46-page Opposition to Petition for Peremptory Writ of Mandate and/or Prohibition response on December 23. Ng's Opposition brief packs a far greater wallop.

For starters, Ng notes that Shen's Appeal is more than likely void — and shouldn't even be considered by the Appeals Court at all. Ng bases this assertion on the fact that Shen's Appeal was "ostensibly filed on behalf of the Ethics Commission and its Executive Director," [John St. Croix]. Ng wrote, "The Ethics Commission has not, however, authorized this [Court] proceeding, and public records indicate that it may not even be aware it was filed." For that reason alone, Ng asserts Shen's appeal should be tossed out and not considered.

Ng notes that only the Ethics Commission itself — not Mr. St. Croix — has authority to decide whether to mount a lawsuit defense. Only the Ethics Commission can decide whether to waive the attorney-client privilege. Not St. Croix. When Grossman filed his initial complaint with the Sunshine Ordinance Task Force in November 2012 regarding the improperly withheld records, St. Croix should have placed on an Ethics Commission agenda a discussion of whether it wanted to produce the withheld records, respond to the complaint, or waive the attorney-client privilege. But no discussion of Grossman's Sunshine complaint was placed on any Ethics Commission agenda.

When the Sunshine Task Force issued its Order of Determination in Grossman's favor in June 2013 ordering St. Croix and the Ethics Commission to produce the records, St. Croix again failed to place an item on the Ethics Commission's agenda for discussion, even if only in closed session. Then, when it became clear that St. Croix was going to ignore the Order of Determination, the Sunshine Task Force referred the matter to the Ethics Commission for enforcement on September 4, 2013. Again, St. Croix placed nothing on the Ethics Commission's next agenda for discussion.

As a consequence, the Ethics Commission never had a chance to avoid Grossman's current lawsuit. The Commission never legally decided — independent of St. Croix — whether to waive attorney-client privilege. It failed to decide to legally authorize defending Grossman's lawsuit. It failed to bring its own lawsuit. And none of the required steps were taken. The Commission has remained utterly silent, 15 months later.

Shen claims that as its Executive Director, St. Croix is "generally" in charge of administration of the Ethics Commission. Shen asserts the Director's administrative responsibilities include making litigation decisions involving the Ethics Commission in consultation with — of all people — the City Attorney. Certainly, St. Croix has no authority to decide whether to defend a lawsuit or to commence an Appellate Court action that could significantly affect the public's constitutional rights of access to public records, without the Ethics Commission's explicit directive to do so.

Shen tells the Appellate Court that Grossman's allegation of procedural improprieties involving filing the City's Appeal is "inapt."

Sunshine Ordinance §67.12(a)(2) does NOT say that a policy body can delegate to a staff member decision-making to pursue litigation which a policy body is required to report out from closed session in an open session. St. Croix does not hold any "closed session" authority under his own right. Clearly, §67.12(a)(2) suggests that decisions to enter into litigation must, at minimum, be determined by a policy body — not by an Executive Director— and they're required to do so only during a properly-noticed, open- or closed-session meeting of the body.

Since the Commission itself never authorized the lawsuit, small wonder Ng asserted the Court should deny Shen's Appeal outright. Although Shen argues this doesn't make the case procedurally defective, of course it is.

And it's a big deal, because not only was Shen's request to strike down §67.24(b)(1)(iii) not properly brought before the Superior Court, Shen's Appeal on behalf of St. Croix was also not properly brought before the Appellate Court, either, due to the Ethics Commission's failure to authorize the Appeal. Shen's Appeal indicates it was filed in the name of St. Croix and the Ethics Commission, but the Commission did not actually bring it.

And it's a bigger deal still, that St. Croix's lists on his Superior Court and Appellate Court filings that five City Attorney's are representing him. It's clear that §67.21(i) prohibits the City Attorney's Office from acting as legal counsel for purposes of denying access to public records, but here we have the City Attorney representing St. Croix at both the trial court and appellate court levels. The Ordinance also provides that the City Attorney cannot give confidential advice to City officers regarding ethics and public records, but that appears to be what Herrera is doing.

The Ethics Commission should have obtained independent legal counsel to represent St. Croix, rather than turning to the City Attorney, who theoretically is prohibited from doing so. This may be yet more fairy dust.

Shen creatively asserts California's Brown Act only sets forth procedures to be followed if a local legislative body is actively taking action involving litigation. He asserts the Brown Act does not "interfere with decisions" about whether a legislative body such as the Ethics Commission must take action. Shen claims that the Brown Act has no division of responsibilities between Ethics Commission members and their Executive Director, hoping to confuse the Appellate Court about whether any decision to pursue litigation can be delegated to staff members such as St. Croix.

Shen uses this convoluted rationale to conclude that the Commission wasn't required to take a collective action to authorize defending the lawsuit because procedurally, St. Croix had ostensibly been authorized to take collective action on the Commission's behalf. The City's various boards and commissions, and the Board of Supervisors, routinely go into closed-meeting sessions to discuss anticipated litigation.

It is doubtful that any other board or commission in the City has delegated to their respective Executive Directors decision-making authority involving lawsuits against other City departments. Surely Shen and Herrera would not argue that the Board of Supervisors can delegate to its "Executive Director" — Angela Calvillo, Clerk of the Board — decision-making authority over whether to authorize lawsuits involving the Board or the City.

The 11-member Board of Supervisors would never delegate to Calvillo the authority to go into closed session with a Deputy City Attorney to approve defending or concluding a lawsuit against the Board of Supervisors or against the City. Nor would the Board permit Calvillo to do so without informing them every step of the way, progress in such a case.

Nor is it likely than Shen and Herrera would argue that Harlan Kelly, General Manager of San Francisco's Public Utilities Commission, could authorize litigation against the City or against the PUC without first obtaining approval from the PUC's own Commissioners in open or closed session.

Does Kelly not have the same authority to enter into litigation without his Commission's prior approval, that Shen asks us to believe has been "delegated" to St. Croix? Are we really expected to believe that the Ethics Commission has granted St. Croix such wide-ranging latitude typically not granted to other City departments and commissions?

Is Shen telling the Appellate Court that since St. Croix may have decided the collective-action "whether" side of the equation himself — making it unnecessary for the Ethics Commission to independently determine "whether" to collectively defend themselves on actual, not anticipated, litigation, since they were formally named in the lawsuit — that "whether" now somehow trumps "if"?

Are we really expected to believe the Ethics Commission is the single City commission that does not hold closed session meetings to approve filing actual litigation in a court of law?

In the end, what we have here is the City Attorney's Office wastefully running up legal costs on the taxpayer's dime in a case that was improperly brought before the Appellate Court. No two ways around it.

Is Sandbagging in Herrera's "Kit Bag"?

Ng notes that the Appeals Court should give wide deference to Grossman, since the City, Shen and St. Croix had not raised "the defenses on which they now rely until after Grossman filed a mandamus action in the Superior Court."

This is particularly true since the Sunshine Ordinance Task Force is a non-partisan, quasi-judicial body created to scrutinize compliance with open records laws. Even the Ethics Commission appears to have acknowledged the SOTF is a quasi-judicial body.

By the time the Sunshine Task Force issues an Order of Determination ruling on access to public records, hearings have already been held at which both parties in a records-access dispute have been afforded ample opportunity to present their cases. At the point an Order of Determination is issued ordering City agencies to comply with the Sunshine Ordinance, a complaint in dispute has been deemed meritorious by the Task Force. Due process has then already concluded.

Although the City concedes that the records Grossman requested fall within the scope of §67.24(b)(1)(iii), Shen and the City suddenly claim on appeal that this Sunshine provision is invalid because it conflicts with City Charter sections 6.100 and 6.102. Ng notes there is no such conflict. Ng suggests that if the Appeals Court tolerates such "sandbagging," it would encourage dragged-out litigation, encumbering the judicial system.

"Sandbagging" has a special meaning in legal contexts. Black's Law Dictionary defines sandbagging as "a trial lawyer remaining cagily silent when a possible error occurs at trial, with the hope of preserving an issue for appeal if the court does not correct the problem." Trial lawyers are not supposed to notice — but then not mention — possible trial errors in the hope of using the error as the basis to mount an appeal should they lose at trial.

Who knew the City Attorney's Office may use "sandbagging" as part of its legal kit bag?

Sandbagging is a well recognized legal term in Court briefs, and a word used by U.S. Supreme Court justices in their written opinions. Justice Antonin Scalia defined sandbagging as "suggesting or permitting, for strategic reasons, that the trial court pursue a certain course, and later — if the outcome is unfavorable — claiming that the course followed was a reversible error." Justice Thurgood Marshall noted that the Sixth Circuit's rules preclude appellate review of any issue not contained in objections, to prevent a litigant from "sandbagging" a district judge by failing to object and then appealing.

Didn't Herrera or Shen learn in law school that Appeals Courts hate sandbagging? How many plaintiff's have brought suit in San Francisco without realizing that Herrera's team may be all too willing to pull sandbagging out of their kit bags? Could any overworked Appeals Court judges have been sandbagged by Herrera's team and not been aware it may have happened?

Ng notes there is no conflict between the Sunshine Ordinance and the City Charter. The two laws can be read in perfect harmony, he says. Ng observes the Charter is "silent with respect to the confidentiality of communications with the City Attorney," and that no provision in the Charter mandates that such communications — or all communications — take place within the boundaries of attorney-client privilege. Shen and Herrera apparently want the Appeals Court to read into the Charter's silence, a new blanket requirement that all communications are confidential, even though the Sunshine Ordinance is not incompatible with the Charter's designation of privilege.

Ng notes that the Brown Act stipulates that when advice from an attorney is being sought or provided that does not concern pending litigation, the attorney-client communication must be in public. The California Legislature made it clear that the relationship between a municipal body and its attorney does not require confidentiality. Advice outside the context of pending litigation must be carried out in full view of the public. In Arkansas, the attorney-client privilege is not allowed as an exemption to the state's Freedom of Information Act.

Both Vallejo and Milpitas have local Sunshine laws like San Francisco's that included eliminating the attorney-client privilege with respect to public records access laws.

The Brown Act appears to be clear that "pending" litigation does not mean the same thing as "threatened" litigation, or the "risk of" potential litigation. Both of the latter could mean almost anything. "Pending litigation" is commonly understood as litigation actually pending in a court of law. Sunshine Ordinance §67.10(d)(1) defines pending litigation as when an adjudicatory proceeding before a court has been formally initiated [filed].

Everyone understands attorney-client privilege is necessary during "pending litigation." But everyone also knows, or suspects, that hiding behind the "risk of litigation" is commonly perceived to be misguided officials hoping that government secrecy might shield them.

In Grossman's case, the records he sought were not privileged from the outset. They didn't involve pending litigation. Shen's and the City's flawed argument that a lawyer's obligation to his client is to maintain confidences does not convert non-confidential communications into confidential ones. That's fairy dust.

The City has known for over 13 years that the Sunshine Ordinance adopted by voters specifically deemed that the types of records Grossman sought are not protected from disclosure. For nearly a decade and a half, Shen and Herrera had to have known they can't use magic dust to convert a non-confidential document into one rebranded confidential.

Neither State law nor the Rules of Professional Conduct for lawyers mandate that all communications are privileged. The communications Grossman sought in this case are not "privileged." Neither State law nor legal professional guidelines create a privilege, where one hadn't otherwise existed.

Shen contends §67.24(b)(1)(iii) prevents the City Attorney from carrying out his duties. Ng notes this is a gross exaggeration. There is nothing in §67.24 that dictates any relationship between the City Attorney and his clients.

Ng notes that Dennis Herrera's own so-called "Good Government Guide" states that "The Sunshine Ordinance provides that notwithstanding any exemption [permitting withholding of records] provided by law, any written legal advice about conflicts or open government laws may not be withheld from disclosure in response to a public records request" [emphasis added].

Herrera's Good Government Guide admission is a signal Grossman is right on the law. Hopefully, the Appellate Court will take judicial notice that Herrera's Good Government Guide agreed 100% with Grossman on this point.

Importantly, while the City is now stridently pursuing having §67.24(b)(1)(iii) struck down, the City has not attacked other provisions in §67.24 that also exclude using other exemptions to permit withholding of documents. Inexplicably, rather than trying to strike down all of §67.24, the City is asking the Appeals Court to strike down only §67.24(b)(1)(iii). Ng asserts "it would be a gross expansion of the privilege doctrine and would undermine its structure by shifting the burden for proving confidentiality," should the Appeals Court agree with Shen.

Shadowboxing With Case Law

In an exercise of shadowboxing, Shen extols the virtues of protecting confidentiality as a justification for asserting an alleged privilege to withhold the documents. Ng notes none of the virtues of confidentiality require that every communication between an attorney and his client be [magically] deemed confidential. Nor do the virtues mandate that the communications at issue in this case —regarding advice involving access to public records — be deemed privileged.

Is Shen shadowboxing, practicing to stay fit?

Shen cited a number of lawsuits involving attorney-client confidentiality in the case law, including "Currieri v. City of Roseville," "Roberts v. City of Palmdale," "Citizens for Ceres v. Superior Court," "Welfare Rights Org. v. Crisan," "Domar Electric, Inc. v. City of Los Angeles," "Scott v. Common Council of the City of San Bernardino," and "Sacramento Newspaper Guild v. Sacramento County Board of Supervisors." Many of these cases do not really deal with issues Shen and Herrera claim they do. Several cases do not state what the City Attorney claim they do.

Ng notes many of the cases are inapposite — inappropriate, inapplicable, or irrelevant to the issues that are before the Court in Grossman's lawsuit.

Some observers have questioned whether the City Attorney truthfully interpreted the case law it cited to the Appeals Court. Hopefully, the judges will closely examine whether Shen truthfully presented the case law in the proper context, since Ng clearly demonstrated that many of these cases are inapt to the circumstances in Grossman's lawsuit.

The City and Shen cite the Currieri case hoping to convince the Appeals Court that courts have long recognized that when interpreting statutes "whatever is necessarily implied in a statute is as much part of it as that which is expressed" [emphasis added]. That's it. Shen would have the Court believe that this "rule of necessary implication" extends to city charters, and that voters who passed changes to San Francisco's City charter in 1995 must have impliedly intended to make all City attorney-client communications privileged and confidential — despite the fact that voters had not actually, explicitly, or even "impliedly" said so.

In fact, the 1995 City Charter changes didn't explicitly ask voters to weigh in on the issue. Shen's fall-back position is that voters must have intended — or implied — something they hadn't even been asked in the question put before them at the ballot box.

Despite the clear articulation in the Sunshine Ordinance adopted by voters in 1999 that the City Attorney is not permitted under §67.24(b)(1)(iii) to withhold disclosing the records in dispute, Shen argues that the Court should believe that an unstipulated "implication" in the City Charter passed by voters four years earlier can "trump" the very clear statement made by voters in the Sunshine Ordinance that says the exact opposite. For Shen and his boss Dennis Herrera, a Charter "implication" may be all that is necessary to "trump" more precise language contained in the Sunshine Ordinance.

The Roberts v. City of Palmdale case involved attorney-client privilege in the context of pending litigation. It is inapplicable here because there was no pending litigation involving the records Grossman sought. The Roberts case is also inapt, in part, because the question considered by the Court was whether city attorney advice distributed by mail prior to a meeting created an illegal closed-door meeting, thus waiving attorney-client privilege. There was no question in Roberts that attorney advice would have been confidential if it had been presented during a closed-session meeting. The question the Roberts Court decided was whether the advice distributed by mail created an illegal closed-session meeting that automatically waived the confidentiality privilege. Shen's reliance on Roberts completely misses the point of whether privilege had been created, which is the issue in Grossman's case.

The Roberts Court never considered the issues raised in Grossman's case, and Roberts has no bearing on the facts in Grossman's case. The scope of disclosure mandated by the CPRA is not at issue in his case. Instead, what is at issue in Grossman's case is the scope of disclosure required by the Sunshine Ordinance. While Roberts may provide that the records at issue in Grossman's case need not be produced under the CPRA, the Sunshine Ordinance states that they must be.

In Citizens for Ceres, the Court cautioned that when justices are interpreting statutes that might expand or limit "privilege" exemptions, they are required to do so cautiously, since they are forbidden from creating privilege or establishing exceptions to privilege using case-by-case decision making. In Grossman's case, the City's appeal seeks to have the Court create a new privilege. A privilege that doesn't necessarily exist, otherwise.

In the Welfare Rights Org. case, the attorney-client privilege was contextual and grounded in a specific need. This is unlike Shen's current argument that all communications between the City Attorney and his clients are privileged, regardless of context or a specific need. The Welfare Rights Org. case involved a Welfare and Institutions statute that allows non-attorneys to represent a welfare recipient at a hearing and determined that representative-client confidentiality was implied. The case didn't rule that it needs to be implied in, or applied to, other situations.

Indeed, the California Supreme Court's Welfare Rights Org. ruling provides no guidance to answer the question of whether attorney-client communications are entitled to privilege "generally," or whether they are "always and necessarily" confidential.

In his Appeals Court brief, Shen claimed on behalf of the City that the Domar Electric, Inc. v. City of Los Angeles case ruled that Charter City's such as San Francisco may not act in violation of their charters. Shen claimed Sunshine §67.24(b)(1)(iii) violates the Charter. But the Domar case only involved a competitive bidding process for bidders on city contracts. The Domar Court ruled there was no conflict between the proposed bidding process and the city's charter. Ng notes that the Sunshine Ordinance is also not in conflict with San Francisco's charter. Shen's reliance on the Domar case is, therefore, inapt.

Shen cited the Scott v. Common Council of the City of San Bernardino case to argue that only voters can change a city attorney's duties by amending a city's charter. Shen argued that voters had set the City Attorney's duties in San Francisco's charter and asserted that Sunshine Ordinance §67.24(b)(1)(iii) changed the City Attorney's charter-defined duties — a claim patently untrue. §67.24(b)(1)(iii) does no such thing; it doesn't involve changing San Francisco's City Attorney duties. The section only requires that a single category of documents — advice provided by the City Attorney to its city "clients" regarding CPRA, the Brown Act, and the Sunshine Ordinance — are subject to full disclosure. They must be made available for public review. That takes them out of the realm of "privilege." Ng notes §67.24(b)(1)(iii) does not conflict with any City Attorney duties set out in the Charter. There's nothing anywhere in the Sunshine Ordinance that changed even one of the City Attorney's duties.

Regarding the Sacramento Newspaper Guild case, Shen and the City Attorney misplace its significance and do exactly the opposite of what the Court had warned against. The Court held in this case that "public board members [who are] sworn to uphold the law, may not arbitrarily or unnecessarily inflate confidentiality for the purpose of deflating the spread of the public meeting law [emphasis added]." The Court warned in the Sacramento Newspaper Guild case that neither the "happenstance of some kind of [pending] lawsuit" nor the presence of a City attorney may serve as a pretext for secret consultations whose revelation will not injure the public interest. The Court warned against the broad and limitless assertion of "privilege" to defeat specific mandates requiring that public information remain available to members of the public. Shen — acting for his masters — attempted to both inflate the need for confidentiality, and confound public interest legislative functions.

In yet another case, Stockton Newspapers, Inc. v. Members of Redevelopment Agency, a California Appellate Court ruled that there are no exemptions when the purpose of communications with an attorney involves a legislative commitment, a provision sometimes referred to as the "legislative abrogation of the attorney-client privileges."

No unfair advantage would have been conferred by giving the public an insight into the City Attorney's views on successive iterations of the Ethics Commission's proposed draft regulations, which were akin to a legislative function. Why is St. Croix so desperately trying to withhold from Grossman the City Attorney's mere "views"?

It would be a travesty if the Appellate Court relied on whether the City Attorney and Shen have truthfully interpreted case law. Observers suspect the City hasn't truthfully presented the case law. Hopefully, the Appeals Court will neither invalidate the Superior Court's ruling in Grossman's favor, nor invalidate our Sunshine Ordinance statute passed by citizen initiative, without first reading the case law that Shen and Herrera so badly misrepresent, damaging their credibility.

It bears repeating that Ng's December 23 response to Shen's November 22 appeal was a brilliant legal analysis. Hopefully the Appeals Court will rule Ng and Grossman are right on the law.

Inappropriate Condescension

If Shen's 20-page Respondents Opposition filed October 9, 2013 in Superior Court and if his 42-page Petition for Peremptory Writ filed in Appeals Court November 22 seeking to overturn Grossman's Superior Court victory weren't bad enough, Shen's 22-page Reply to Opposition to Petition for Peremptory Writ of Mandate and/or Prohibition filed on January 14, 2014 sinks to a new low, stooping to a heavy dose of inappropriate condescension. Appellate Court justices can't miss that Shen insults Grossman as a person at every opportunity.

For openers, Shen discovered the word "mere" and used it at least seven times, including branding the Sunshine Ordinance a "mere ordinance" five times. It's Shen's effort to belittle the hierarchy of ordinances in local government.

In an exercise of hairsplitting, Shen tried to diminish Mr. Ng's observation that Herrera's own Good Government Guide acknowledges certain legal advice written by the City Attorney may be disclosable under the Sunshine Ordinance. Shen tries to throw sand in the eyes of the Appeal Court by claiming that the Good Government Guide's acknowledgement was a "mere warning" to the City Attorney's clients and was not a "concession" by the City Attorney that §67.24(b)(1)(iii) is consistent with the Charter. By reducing the clear meaning of the text in the Good Government Guide to a "mere warning," Shen seeks to fool the Court into believing it is not an admission the provision is valid.

Shen also denigrates the role of voters who hold the ultimate plenary power over the City's legislative affairs. The communications Grossman sought in this case involve Ethics Commission procedural regulations that were being vetted as a legislative function over which voters should have some control, or at least input. But Shen reduces the development of the regulations to "mere policymaking," as if of no interest or consequence to voters.

While Shen argues development of policy regulations is "mere" policy-making, he nonetheless wants to elevate the policy-making to the same standard of protected attorney-client privilege provided for cases involving litigation.

Elsewhere, Shen denigrates Grossman several times and felt compelled to tell the Appeals Court that Grossman had previously sued the City over Sunshine matters, perhaps to paint Grossman as a repeat litigant. Although Shen failed to tell the Court the previous matter had been settled in Grossman's favor, Shen blabbed to the Court that Grossman had "ghostwritten" a memo for the Sunshine Ordinance Task Force submitted to the Ethics Commission regarding the proposed regulations.

Shen babbled, "The fact that the Task Force is allowing private citizens to ghostwrite memoranda for it underscores the emptiness of Grossman's suggestion that the Task Force is entitled to deference."

First, "ghostwriting" is hardly a crime. If it were, thousands of current and former mayors, presidents, and kings and queens would be guilty of hiring ghostwriting speechwriters. Why hasn't Shen asked former Mayor Willie Brown if the long-running rumor is true that Brown's column in the Chronicle has been ghostwritten by another prominent Chronicle columnist all along?

Second, Shen withholds from the Court information that the Task Force members are all private citizens in their own right. They are entitled to consult and work with other private citizens, such as Grossman. There is no rule prohibiting the Task Force from seeking advice from experts such as Grossman, who is a lawyer dedicated to public records and public access law.

Third, Shen fails to inform the Court that the Sunshine Task Force — on the record and during public meetings — had asked its own Deputy City Attorney, Jerry Threet, to help draft a response to the Ethics Commission concerning the proposed regulations being developed by Ethics. Threet declined to help, saying SOTF would need to obtain approval for him to work overtime developing a response. Threet — like Shen — is expert at using Herrera's fairy dust.

Shen also failed to inform the Court that Threet had declined to attend a joint hearing between the Ethics Commission and the SOTF. Threet lamely claimed it might have been a conflict of interest for him to do so. He was supposed to be operating under an "ethical wall" separating him from his boss, the City Attorney, and his client, the SOTF. Shen also omits informing the Court that the comments Grossman provided as a "ghostwriter" were made during open, public meetings of the SOTF.

Shen wailed that the Task Force had taken "nearly a year" to provide comments and feedback on the Ethics Commission's proposed draft regulations. But Shen failed to inform the Court that the reason the Task Force hadn't met for nearly six months between July and November 2012 was because the Board of Supervisors had refused to appoint new members to the Task Force.

Without a quorum, the SOTF wasn't permitted to meet to conduct business. The delay providing feedback wasn't because the Task Force was simply dragging its feet in 2012 on the Ethics Commission's proposed regulations, as Shen wrongly implies. The Task Force was simply prohibited from meeting and conducting business. Shen's claim that St. Croix had determined it wouldn't be "useful nor efficient" to send further drafts of the proposed regulations to the Task Force for additional feedback also deceived the Appeals Court.

Misleading the Appellate Court

Shen continues to mislead the Appeals Court that the Sunshine Task Force is a "purely advisory body." The Task Force was established to implement and carry out certain aspects of San Francisco's Sunshine Ordinance and the CPRA. By claiming the SOTF is "merely" an advisory body, Shen and Herrera are trying to persuade the Court that the Task Force has no authority to issue any Orders of Determination to any City department ordering compliance with the Sunshine Ordinance. The Sunshine Task Force is not a "mere" advisory body, it's a quasi-judicial body. Shen and Herrera must surely know this. And if they don't, they should consider resigning their jobs.

The Task Force is specifically empowered by the Sunshine Ordinance to determine where there have been violations of the Ordinance. It is also empowered by the Sunshine Ordinance to "order" production of records improperly withheld.

Shen fails to tell the Appellate Court that Sunshine Ordinance §67.21(e) specifically provides that if the Sunshine Task Force determines a record is a public record, it shall [must] order the Custodian of the record to comply and produce it. He also fails to inform the Court that §67.21(f) goes on to state that any other administrative remedies — in addition to the Task Force's administrative remedy provided in §67.21(e) — shall in no way limit the availability of other administrative remedies, nor shall administrative remedies provided by this section in any way limit the availability of judicial remedies.

Shen fails to inform the Court of §§67.21(e) and (f), precisely to obscure that the Task Force does not issue mere "advisory opinions." The Task Force issues what are, essentially, binding orders of administrative, quasi-judicial remedies. After all, the Task Force's primary mission is to adjudicate disputes involving access to public records. This makes it, if nothing else, an adjudicatory body — at a minimum — not a "purely advisory body" as Shen brazenly and wrongly deconstructs. Shen appears to hope the Court won't notice this.

Shen's nonsense that the SOTF is merely an "advisory body" is based on §67.30(c) of the Ordinance, which outlines the SOTF's separate duties to provide "advice" to City agencies. But Shen creatively elided telling the Appellate justices that §67.21(e) clearly stipulates that the SOTF has responsibilities to "order production" of public records, making it an adjudicatory body with power to issue orders, in addition to offering "advice."

Like all of us who wear multiple hats — roles as father, son, uncle, brother, or wife, mother, daughter and perhaps doctor — the SOTF wears multiple hats.

At the municipal agency level, take the Department of Public Health, which wears many hats providing trauma care, primary care, long-term care, and environmental health, among others. Or take the MTA, which provides bus services, oversees taxis, and has its parking and traffic control duties. Shen sprinkled fairy dust on the Appellate justices to obfuscate the SOTF's standing as an adjudicatory body, claiming the SOTF has a single role — merely to provide "advice."

In his January 14 Reply, Shen now claims that the Roberts vs. City of Palmdale case did not apply only to communications made in anticipation of pending litigation, it applies to any legal advice even when no litigation is threatened, since "governmental policymaking, particularly on cutting-edge issues, often results in litigation [emphasis added]." Shen elevates potential "litigation risk" to new heights, suggesting that the mere risk of future litigation somehow justifies total secrecy with respect to attorney-client communications involving mere regulations-making. Shen makes the NSA took tame by comparison.

And Shen fails to tell the Appellate Court that the Sunshine Ordinance specifically provides in §67.24(b)(2) that "when litigation is finally adjudicated or otherwise settled, records of all communications between the department and the adverse party shall be subject to disclosure, including the text and terms of any settlement," unless otherwise privileged under California law. Not only were the records Grossman sought not protected by privilege (since not confidential at the outset), City attorney advice in the Ethics Commission's and St. Croix's department records involving this case may also not be protected at the conclusion of Grossman's lawsuit, either.

Remarkably, Shen noted at the conclusion of his January 14 brief, that "The City agrees with Grossman that the Sunshine Ordinance is best understood not as a 'waiver' but as an attempt to bar assertion of [attorney-client] privilege in the future by the City Attorney's clients." Since Shen agrees with Grossman on this point, one has to wonder when Shen thinks "in the future" should commence. After all, we're approaching the 15th anniversary of passage of the 1999 Sunshine Ordinance amendments. How much longer does Shen want "in the future" to wait?

Shen ended on a thud, claiming the City Attorney's relationship with its clients is protected by state-law privilege and work product doctrine. Shen makes this wild fairy-dust claim after previously all but admitting to the Court that of the 24 documents withheld from Grossman, none involved City Attorney work-product records. They only involved attorney communications.

Shen also misleads the Court by omission. For starters, Shen fails to address that §67.21(i) prohibits the City Attorney from acting as legal counsel to City agencies for purposes of denying access to public records. Indeed, §67.21(i) specifically states the City Attorney shall [must] act to protect and secure the rights of the people of San Francisco to access public information and public meetings and shall [must] not act as legal counsel to deny access to public records.

§67.21(i) goes on to state that "all communications with the City Attorney's Office with regard to this ordinance, including petitions, requests for opinion, and [actual City Attorney] opinions shall be public records." All the Appellate justices need to do is to carefully read §67.21(i) to know Shen is wrong and elided key information. And that Ng and Grossman are right on the law.

Emperor's New "Good Government Guide" Clothes

An aside about Herrera's Good Government Guide is in order.

Perhaps ironically, the City's ethics laws require that even members of San Francisco's Sunshine Ordinance Task Force must take annual training on provisions of the Sunshine Ordinance, training required of all City employees required to file statements of economic interest on annual FPPC Form 700's.

The training is conducted by the City Attorney's Office, relying heavily on Herrera's Good Government Guide, which claims to be a guideline to educate City employees and elected officials about our local Sunshine ordinance, California's Public Records Act, and the state's Brown Act.

But former members of the Sunshine Ordinance Task Force who were required to attend these training sessions — and spoke on condition of anonymity — note that the training sessions never acknowledge the Sunshine Task Force's key role as an adjudicatory body in disputes involving access to public records.

Indeed, several Task Force members report their impression is the training sessions subversively teach City employees how to defend themselves against Sunshine violations, rather than on how to transparently comply with the Ordinance.

Herrera's Good Government Guide includes a comprehensive section regarding the Sunshine Ordnance. Rita O'Flynn — who as a private citizen was previously forced to sue, but is not currently making any claims against the City — reviewed an employee training session on the Good Government Guide hosted by the City Attorney's Office.

She notes that although the City Attorney's Office maintained during her Sunshine Task Force complaint hearings — and later in Court filings — that it had provided her with all responsive e-mails she had requested, the Good Government Guide may have helped the City from providing full transparency.

The Sunshine Task Force ruled in O'Flynn's favor, finding that the City had improperly withheld records from her. When the Task Force referred her complaint to the Ethics Commission for enforcement, Ethics simply denied her complaint, indicating that its "investigation" showed that the City had provided all records responsive to her requests.

Astoundingly, during formal litigation the City subsequently turned over approximately 16,000 pages of additional, directly responsive e-mails and documents that the City had claimed during Task Force hearings didn't exist. The City finally provided them only during the discovery phase of litigation, after she was forced to file a costly lawsuit.

How could the City Attorney's Office have so mislead both the Sunshine Task Force and the Ethics Commission that O'Flynn had been provided all responsive public records during adjudicatory hearings, and only later coughed up 16,000 pages of documents it repeatedly and adamantly claimed hadn't existed? How does the Ethics Commission now explain its dismissal of O'Flynn's case, after 16,000 pages "magically" turned up? Perhaps fairy dust can explain it.

So much for the City Attorney's "transparency," given it grossly mislead the Task Force during O'Flynn's hearings.

"This should tell us how City employees view the Sunshine Ordinance," O'Flynn notes. "Basically, it's just a pain in the ass to them and nothing more," she adds.

What's At Stake?

If the City's appeal on behalf of St. Croix is successful, the public's ability to monitor the City Attorney's advice and assistance to officials, policy bodies, and other City units regarding this single subject area — narrow access involving City Attorney communications on records access law — would be seriously impaired. If the public's ability to access those records were blocked, members of the public would be at a great disadvantage when contesting City officials' refusal to disclose other records based on that advice.

Should Shen prevail, there may well be irreparable damage to the public's ability to access public records in San Francisco, since it is likely all other City agencies, officials, departments, and policy bodies may resist records requests that involve the City Attorney's "advice."

Should the City persuade the Appellate Court that §67.24(b)(1)(ii) is not enforceable and should be struck down, other sections of the Sunshine Ordinance may also be in jeopardy.

It may invalidate the provision in §67.21(i) that requests for opinions to the City Attorney, and the City Attorney's actual opinions to City departments and employees are, in fact, public records. It could invalidate provisions in §67.24(g), (h), and (i) that currently bars the City from claiming "deliberative process" and various "privilege" exemptions in CPRA §6255 to justify withholding public records that are otherwise required to be disclosed.

If multiple sections of the Sunshine Ordinance are struck down by the Appellate Court, it would permit the City Attorney and his City clients to keep secret all communications regarding public records access issues. It would permit the full weight of the City Attorney's Office to be used to defend errant City employees and departments against citizen Sunshine complaints, which the City Attorney is currently barred from doing.

This appears to be Shen's and Herrera's end game: To completely strip the Sunshine Task Force of its ability to order City departments and City employees into compliance with the Sunshine Ordinance.

Ng adroitly notes the public's right of access under California's Public Records Act (CPRA) operates as a "floor," not as a "ceiling." CPRA authorizes local governments to adopt requirements permitting greater access to records than prescribed by minimum State standards. That's all §67.24(b)(1)(iii) does. It permits greater access.

San Francisco voters expressly authorized the Ordinance's provision in order to "shrink one of the islands of privacy by precluding San Francisco [government] agencies from invoking certain statutory exceptions for public records." But only within certain narrowly-defined subject areas, limited to laws governing ethics and public records access.

Shen conflates this narrow subject area with his "the sky is falling" drama before the Court, misleading the justices.

Grossman sought communications providing City Attorney advice involving disclosure of public legislative records. Shen claims requiring the City Attorney to do so will open the door to others seeking City Attorney communications involving every other legal subject area. Ng shredded Shen's claim.

Given that the 1995 voter guide stated citizen initiatives moved to Charter appendices could only be changed by the voters, why is the City asking the Appellate Court to strike down sections of the Sunshine Ordinance rather than asking the voters to amend the Ordinance?

As the San Francisco Chronicle reported in "Ex-supe Settles Lawsuit" on February 21, the $75,000 fine against former Board of Supervisor Michael Yaki involving 70 instances of lobbying violations involved Herrera wanting to send "a strong message that the San Francisco Lobbyist Ordinance has teeth."

Ironically, Herrera stated, "We City officials take seriously our duty to protect transparency in our legislative process." If that were true, why is Shen — on behalf of Herrera — trying so stridently to block the transparency of the legislative process involving the Ethics Commission's regulations by appealing Grossman's Superior Court victory?

Is Herrera cherry-picking which aspects of transparency, which City Ordinances, and which legislative functions City officials will take seriously as their duty to protect? It will be interesting to eventually learn how much Herrera spent to protect transparency in Yaki's case, versus how much Herrera has spent to prevent transparency in Grossman's case. More than likely, the serious spending will have been wasted trying to prevent Grossman's Superior Court victory.

Shen's and Herrera's "fear mongering" is designed to distract the Court and drown out facts in Grossman's case. It's an age-old trick: Scream scary analogies often and loudly. Toss in handfuls of fairy dust. Stir in sandbagging. These bait-and-switch tactics are designed to make the Appeals Court panic, by confounding issues before the Court.

Hopefully, we'll see in Ng's final brief due in Appellate Court on March 7 another brilliant dissection of Shen's fairy tale. But brace for Shen likely tossing out more fairy dust in his final brief due March 31.

Herrera's End Game

The Sunshine Ordinance specifically requires a narrow reading of the City charter. §67.1 notes there are rare circumstances permitting the business of government to be conducted in secret, and those circumstances should be narrowly defined to prevent public officials from abusing their authority. In the end, Grossman's lawsuit involves St. Croix's and the Ethics Commission's "secret" communications with the City Attorney regarding draft regulations. Does Herrera want to prevent the loss of abuse-of-authority for public officials and the loss of his attempts at secrecy?

The CPRA authorized localities to adopt requirements for greater access to records than CPRA's minimum standards, which voters did when they adopted the 1999 Sunshine amendments. Shen all but ignores that whatever the hierarchical relationship between general provisions in the City charter and a detailed, specific enactment by voter initiative, the fact that the pertinent section — §67.24(b)(1)(iii) — was authorized by express state law makes Shen's debate that the charter "trumps" an ordinance of no significance. Hopefully, the Court will take judicial notice of this lack of significance.

The City is arbitrarily seeking to inflate the necessity for confidential communications in a case that only involves development of legislative regulations. The fairy dust — that all City Attorney communications involving advice on compliance with open government laws must be deemed confidential — must end.

Instead of invalidating §67.24(b)(1)(iii) as Shen requests, perhaps the Court should rule that San Francisco's charter may be in conflict with CPRA, and the charter should be amended.

Hopefully, the Appellate Court will rule Grossman and Ng are right on the law, and will ignore the fairy dust from Herrera and Shen.

Monette-Shaw is an open-government accountability advocate, a patient advocate, and a member of California's First Amendment Coalition. Feedback: monette-shaw@westsideobserver.com>.

Full Disclosure: Much of the material reported in this article was contained in the legal briefs filed in Court. The opinions expressed are solely those of this author.

March2014

Advancing Open Government in San Francisco

Allen Grossman
Retired lawyer Allen Grossman, who won twice at court against the Ethics Dept.
for Sunshine violations

Four Major Sunshine Victories

In a democracy predicated on the principle that citizens have inherent rights to know what their government is doing on their behalf, a City Librarian shouldn’t be permitted to commit perjury by concealing violations of laws regulating disclosure of financial conflicts of interest. Nor should an Ethics Commission be permitted to hand itself a blanket exemption to avoid hearing complaints brought against its own staff and its Commissioners.

Nor should a Public Health Commission be permitted for over two decades to omit meaningful agenda item descriptions of discussions and actions it plans to take during its meetings. Nor should the same Ethics Commission be permitted to flout orders to produce public records required by State and local laws, and in the process rack up hundreds of thousands of dollars in wasted expenses during preventable Superior Court lawsuits.

Grossman's two Superior Court lawsuits have cost the City nearly $100,000, and mounting — all because of St. Croix's and Herrera's needless battles … in the name of government secrecy."

These four open government violations represent the epitome of utter contempt of voters, contempt for open government, and clear contempt of the public’s right to know. These four violations — although not a whole host of other San Francisco government secrecy — have been stopped in San Francisco by another small group of dedicated citizens.

All four of the open government victories were against three Department Heads — at the Public Library, Department of Public Health, and the Ethics Commission — who all report to Mayor Ed Lee, and against the full Health Commission. The three department heads appear to collectively believe they’re allowed to brazenly violate State and local laws, or are above the law. There will always be Sunshine Ordinance violators, because some City employees believe they may have something to gain from secrecy and obscuring the truth, and are motivated to do so.

Citizen’s shouldn’t have to file costly Superior Court lawsuits to assert their rights, and then be told by Deputy City Attorney’s in court filings that San Francisco voters are powerless to adopt laws requiring that our local government officials disclose public records when the records merely involve communications with the City Attorney. That’s a novel legal proposition, but it’s thought to be unfounded and untenable.

The four open-government victories recently won occurred due to combined efforts of ten members of San Franciscans for Sunshine, including Peter Warfield, Executive Director of the Library Users Association; James Chaffee, a democracy advocate and former chair of the Sunshine Ordinance Task Force; Ray Hartz, Jr., Director of San Francisco Open Government; this columnist and Dr. Maria Rivero, a former senior physician specialist at Laguna Honda Hospital; Bruce Wolfe, a former Vice Chairperson of the Sunshine Ordinance Task Force; Derek Kerr, MD, the former LHH physician terminated for filing multiple whistleblower complaints involving the Department of Public Health and Laguna Honda Hospital; others; and most significantly, by Allen Grossman, a retired lawyer and prominent expert on San Francisco’s Sunshine Ordinance and State records law who is being represented by lawyer Michael Ng, another expert and full-time litigator.

The chain of recent Sunshine victories presented below chip away at the secrecy preferred by career politicians in San Francisco’s “City Hall Family” that is driven in large measure by the flawed legal advice provided by City Attorney Dennis Herrera and his top-heavy team of approximately 176 Deputy City Attorney’s — who cost taxpayers a staggering $27 million in salaries alone in 2012, excluding fringe benefits of 30% to 40% — and who all too often appear to be struggling mightily against open government, and by extension, against San Franciscans.

City Librarian Fined by the FPPC

During its regularly-scheduled meeting on September 19, 2013, California’s Fair Political Practices Commission (FPPC) accepted a written admission of guilt by San Francisco City Librarian Luis Herrera for his failure “to report gifts received from the Friends of the San Francisco Public Library on Annual Statements of Economic Interests [known as Form 700’s] for calendar years 2009, 2010, and 2011.”

The filing regulations for the Form 700 reports and accompanying statements stipulate the forms shall be signed under penalty of perjury, verified by the filer that they have used all reasonable diligence in preparation of the statements, and that to the best of their knowledge are “true and complete” financial statements.

Government Code §87300 — which resulted following adoption of California’s Political Reform Act of 1974 — states, “Every person who signs and verifies any report or statement required to be filed under this [act] which contains material matter which he knows to be false, is guilty of perjury.” Herrera was fined just $200 for each of three counts of violating disclosure laws, for a total of just $600, a small slap on the wrist for having failed to accurately report financial conflicts of interest he was required to report on the Form 700’s under penalty of perjury.

Mr. Herrera — who serves as department head of a City Department and earned $218,387 in calendar year 2012 — was forced to formally acknowledge that he had unlawfully failed to report financial contributions he received from the Friends of the Library. Why have we heard not one peep about Luis Herrera’s fine and unethical behavior out of his boss, San Francisco Mayor Ed Lee?

The FPPC complaint, filed by public library watchdog James Chaffee in April 2013, alleged that Herrera had repeatedly filed Form 700’s declaring he had no donations to report on his Statements of Economic Interest when, in fact, research by whistleblower Ray Hartz and James Chaffee revealed Mr. Herrera had received at least $130,000 from the Friends in two of the three reporting periods. Both Chaffee and Hartz are long-time library advocates. Peter Warfield also provided research assistance, and widely publicized the FPPC case against Herrera.

It’s not known why Mr. Herrera needed to augment his $218,387 City salary by accepting, but failing to report, significant gifts from the Friends of the Library. But it illustrates that city contractors and non-profit “Friends of” City department organizations are all too willing to buy influence at City Hall.

The FPPC’s order against Herrera — referred to as a “stipulation” — didn’t state how much in unreported gifts he received, but research by Hartz showed that the Friends of the Library had provided Herrera $66,000 in 2008–2009 and $65,000 in 2009–2010 for a “City Librarian’s Fund.”

Chaffee’s previous research of the Friends of the Library’s IRS non-profit tax reports and official reports of donations posted on the library’s website, reveals that the Friends of the Library raised $36 million in the decade between fiscal years 2000–2001 and 2009–2010, but only donated a paltry $4 million to the library during the same period.

Mayor Lee’s silence on Herrera’s FPPC fine is as troubling as the Mayor’s refusal to remove Library Commission president Jewelle Gomez, who was found by both the Sunshine Ordinance Task Force and the Ethics Commission in July 2011 as having violated the Sunshine Ordinance. The Ethics Commission recommended to Lee that he remove Gomez, a recommendation that our Mayor has studiously refused to implement for now over two-and-a-half years. Perhaps the Mayor is counting on seeking political support from Friends of the Library, Luis Herrera, Ms. Gomez, and other helpful library employees when he seeks re-election to a second term.

Preliminary research of just 12 of the approximate 60 City Departments reveals that just 611 (barely 5%) of 12,082 City employees are required to file Form 700’s detailing potential financial conflicts of interest, but only 34 (5.5%) of the 611 are required to file their Form 700’s with the Ethics Commission that the FPCC and citizens can access easily on the Internet. [Editor: The City had 36,761 employees in 2012, of which the 12,082 only represent roughly one-third.] The remaining 577 of the 611 employees (94.5%) are only required to file their Form 700’s with their employing City Department — where they are harder to uncover, since not required to be posted on departmental web sites. It’s unknown how many other Form 700 filers under-report financial interests on their Form 700’s, as Luis Herrera so blatantly did.

But FPPC complaints can, and do, lead to fines against miscreant Department Heads such as City Librarian Herrera.

Ethics Tried Anointing Itself Sunshine-Exempt

Four days after the FPPC ruling against Luis Herrera, San Francisco’s Ethics Commission blatantly attempted to exempt itself from a key provision of our local Sunshine Ordinance, but its proposal was stopped dead in its tracks on September 23 following testimony from members of a small group of thoughtful committed citizens known as San Franciscans for Sunshine, previously referred to affectionately as the “Sunshine Posse.”

On Wednesday, September 18, an “interested persons” e-mail notice was sent by the Ethics Commission, announcing proposed changes to the Commission’s Regulations for Violations of the Sunshine Ordinance (“Regulations”) that Ethics staff claimed suddenly required modification just nine short months following implementation of the new Regulations on January 25, 2013.

The provision Ethics staff desperately wanted to suddenly alter involved referrals of complaints to the Ethics Commission that allege Ethics staff, Ethics Commissioners, or its Executive Director, John St. Croix, may have violated provisions of the Sunshine Ordinance.

Brazenly, St. Croix — who earned just $144,288 in 2012, as one of the lowest-paid City department heads — tried to muscle through the Ethics Commission’s approval process on September 23 changes to its regulations that would have granted blanket immunity and an open-ended exemption for any complaint alleging that Ethics Commissioners or Ethics staff had violated the Sunshine Ordinance, along with a provision to simply return any referred complaint against the Ethics Commission to the originating referral entity, and take no further action on any such complaint.

St. Croix also wanted to change Ethics’ rules that if a complaint is filed directly with the Ethics Commission (as opposed to a formal complaint being referred from the SOTF for enforcement) alleging violations of the Sunshine Ordinance by Ethics staff or commissioners, that the staff would simply inform the complainant of other legal remedies under State and local law — such as to the District Attorney, State Attorney General, or costly Superior Court lawsuits — and would also take no further action.

St. Croix’s lame rationale was that “it has been a challenge to find other Ethics agencies that are willing to handle them in the Commission’s stead. To avoid imposing such work on other Ethics agencies and to avoid any appearance of possible conflict, staff believes that informing the Complainant to pursue other available remedies would be the best measure.”

Under questioning from his own five-member Ethics Commissioners, only four of whom were present on September 23, St. Croix admitted that there have only been “three or four” complaints alleging that Ethics Commission staff had violated the Sunshine Ordinance in the 20 years since it was adopted by the Board of Supervisors in August 1993 and amended by voters in November 1999. Given the low volume of complaints referred to Ethics alleging Sunshine violations by Ethics staff, there is rarely any “burden” imposed on other Ethics agencies, and Ethics has only had to face the “challenge” of finding other jurisdictions to hear complaints involving our own Ethics Commission just a handful of times.

Three Cases Against Ethics Commission Outsourced

One complaint against Ethics staff was filed jointly by Ethics Commission staff members Kevin De Liban and Oliver Luby in early 2004 against the Ethics Commission’s then Executive Director, Ginny Vida, and Deputy Director Mabel Ng. Vida and Ng had ordered Luby — in violation of State law and San Francisco’s Sunshine Ordinance — to destroy public records that had been mistakenly submitted to Ethics by the 2004 Newsom Mayoral Swearing-In Committee.

The documents involved campaign finance issues potentially damaging politically to newly-elected Mayor Gavin Newsom and his campaign treasurer, Jim Sutton. The documents revealed large payments under the heading “San Francisco 2004 Swearing-In Committee” to more than two dozen individuals, most of them then-salaried employees of Newsom’s mayoral campaign, several of whom reportedly worked for Newsom’s initial administration. They also showed a $54,000 payment to Newsom’s mayoral campaign.

Ms. Vida eventually deleted the documents from Luby’s computer, which most likely amounted to a misdemeanor or felony, never pursued against her.

The Ethics Commission forwarded Luby’s complaint to the Oakland Public Ethics Commission’s executive director for investigation, who eventually ruled against him. Five years later, Luby filed a Whistleblower complaint in May 2009 on an unrelated matter, which the City Controller eventually upheld; he had filed two other whistleblower complaints. But subsequently, Luby faced retaliation and was terminated in June 2010.

A second complaint against Ethics staff thought to have been outsourced to another jurisdiction was an anonymous complaint also filed in 2004 against Ethics’ Deputy Director Mabel Ng, alleging that Ethics had proceeded with a special meeting of its Commission in violation of Sunshine Ordinance noticing requirements. The illegal special meeting appears to have paved the way for former City Supervisor Tony Hall’s appointment as director of the Treasure Island Development Authority, which in turn allowed the Mayor’s office to appoint Sean Elsbernd to Hall’s former seat on the Board of Supervisors — and allowed Elsbernd to register for the November 2004 election as an incumbent, shortening the deadline for other candidate’s to challenge Elsbernd, which effectively cleared the field for Elsbernd’s first election.

A third complaint against Ethics staff outsourced to another jurisdiction involved a Sunshine Ordinance Task Force complaint filed on March 6, 2011 titled Patrick Monette-Shaw vs. Ethics Commission (Case 11014), which sought to obtain the Ethics Commission’s closing memo of the Laguna Honda Hospital patient gift fund whistleblower complaint and the Ethics Commission’s investigative file. The complaint also involved the failure to release correspondence between the City Controller’s whistleblower program and the Ethics Commission, since Ethics and the City tried to assert that a so-called “official information” privilege applied to the entire file they wanted to keep totally secret.

But when the SOTF ruled in my favor on May 18, 2011 and referred the case to Ethics for enforcement, it was then outsourced not to an Ethics Commission or Sunshine body in another jurisdiction, but to San Jose’s City Attorney’s Office, which ruled against my complaint on September 6, 2012, 18 months after the complaint was filed in 2011.

All three of the Sunshine complaints filed against Ethics staff were found by the Sunshine Ordinance Task Force to have had merit, and each case was referred to Ethics for enforcement, but each of the three cases were outsourced to other jurisdictions. This illustrates that Ethics previously had not had a conflict-of-interest accepting referrals that alleged misconduct by Ethics’ own staff, and illustrates there is rarely any “burden” imposed on other Ethics agencies, since it has occurred just three times.

Ethics’ Sought Get-Out-of-Jail-Free Card

During public testimony on September 23, it became clear that St. Croix’s proposal to grant a blanket exemption to Ethics to refuse accepting Sunshine complaints involving Ethics staff would have amounted to a get-out-of-jail-free card, but only for Ethics as the sole City department awarded an exemption from Sunshine. Former Laguna Honda Hospital physician Dr. Derek Kerr — who was eventually awarded a $750,000 wrongful termination settlement award regarding his dismissal for exposing the raid of LHH’s patient gift fund — testified “Sunshine complaints against Ethics staff are rare. There’s no need to dodge them.” Kerr also noted there have only been three complaints made against Ethics’ staff since the Sunshine Ordinance was adopted.

Former Sunshine Ordinance Task Force (SOTF) member Bruce Wolfe testified that the proposal to exempt Ethics staff would create a slippery slope, the Ethics Commission should not cherry pick which Sunshine complaints it will accept, and should not exempt Ethics staff, since no other City employee and no other City department is granted the same privilege.

Retired lawyer Allen Grossman testified that there is no exemption in the Sunshine Ordinance for the Ethics Commission, its Director, or its staff to be granted a blanket waiver. Grossman stated that the California Constitution governs, and the Ethics Commission could not adopt this exemption without violating both the Sunshine Ordinance and the State Constitution.

For my part, I testified that it is Ethics’ responsibility to investigate Sunshine referrals sent to Ethics for enforcement involving cases against their own co-Commissioners.

Following thoughtful testimony from members of San Franciscans for Sunshine, the Commission sheepishly took no action and rejected St. Croix’s proposed changes, quietly agreeing on September 23 not to adopt the proposed blanket waiver, handing St. Croix an embarrassing public defeat.

St. Croix has been the public face of the City’s gluttonous attempts to scuttle open government ever since his appointment as Executive Director in 2004. During the past decade, he has been perceived as being instrumental to the City’s efforts to thwart Sunshine and protect high-ranking City employees, often working hand-in-glove with City Attorney Dennis Herrera to implement government secrecy, rather than government transparency.

So it really comes as no great surprise that after the Ethics Commission went in to closed session on September 23 — to conduct St. Croix’s annual performance review following its rejection minutes before of his bald attempt to hand Ethics broad blanket immunity from hearing complaints against Ethics staff — the meeting minutes indicate that when the Commissioners reconvened in open session, they attempted to smooth St. Croix’s ruffled feathers.

Ethics’ Vice-Chair, Paul Renne — husband of former City Attorney Louise Renne, who by report despises San Francisco’s open-government Sunshine Ordinance even more than her successor, Dennis Herrera — stated that “it had been a rough evening on staff,” apparently including on poor Mr. St. Croix. Renne stated on behalf of other Ethics Commissioners that he didn’t want staff or St. Croix to take the public criticism to heart, and it isn’t the way Ethics Commissioners feel. Renne suggested that the accusations [made during public comment] “were all unfounded comments.” Ethics Chairperson Beverly “A Deer Caught in the Headlights” Hayon agreed with Renne; she congratulated St. Croix on his hard work and stated he shouldn’t “take the comments personally or to heart.”

Would that be St. Croix’s decade of hard work blocking access to public records, his hard work dismissing all 39 Sunshine cases the Sunshine Task Force had referred to Ethics for enforcement, and his hard work protecting City department heads found violating the Sunshine Ordinance?

As Paul and Beverly tried to re-fluff St. Croix’s mottled feathers, both of them more than likely had to have known (unless St. Croix hadn’t shared news with the pair) that just five days earlier, lawyer Allen Grossman had filed his second Superior Court lawsuit on September 17 naming both St. Croix and the Ethics Commission as respondents for their failure to produce public records requested on October 3, 2012 that St. Croix appears to have improperly withheld, discussed below.

To be fair, when Hayon and Renne sought to reassure poor Mr. St. Croix on September 23 following closed session, although they may have known Grossman had filed his second lawsuit against Ethics, they had no way of knowing that a month later the Superior Court would rule on October 25 in Grossman’s favor, largely over the same issue of improper withholding of records raised in Grossman’s 2010 lawsuit. So much for St. Croix’s “hard work” of withholding records, hard work rightfully overturned by a second Superior Court judge, who ignored St. Croix’s disheveled feathers.

Superior Court’s First Rejection of St. Croix’s “Hard Work”

When Allen Grossman’s first Superior Court case — Allen Grossman vs. San Francisco Ethics Commission, John St. Croix, and Richard Mo — was settled in Grossman’s favor in February 2010, it represented a reversal of the Ethics Commission’s assertion of exemptions for its investigative records and future Ethics Commission investigative files. His case in 2010 had asserted that none of the citations offered by the City Controller and the Ethics Commission had provided a valid exemption to the California Public Records Act permitting the withholding of previous records then sought by Grossman. Grossman was awarded $24,900 in legal fees and costs, likely because if the amount had surpassed $25,000, it would have required Board of Supervisors approval, which “negative publicity” the City wanted to avoid at all cost.

The City Attorney spent an additional $13,062 fighting Grossman’s first Superior Court case in 2010, pushing the tab to nearly $40,000. In the end, the Ethics Commission was required to provide Grossman with approximately 150 documents that had been improperly withheld, most of which were the Ethics Commission’s un-redacted and complete investigative files on approximately 14 cases referred by the SOTF to Ethics for enforcement, which Ethics had simply dismissed as unsubstantiated and refused to release, until Grossman filed suit in Superior Court, which concluded St. Croix had to cough up the records.

It’s clear Paul Renne, Bev Hayon, and Herr St. Croix all need to be replaced at once, clueless about the abhorrent blanket exemption St. Croix attempted to cram through, stopped by citizen activists. Unless this trio wants to invite another Superior Court lawsuit challenging blanket Sunshine exemptions potentially granted to Ethics to skirt the law.

Health Department Finally Ordered Into Sunshine Compliance

Another open-government victory occurred on October 2 for two concerned citizens who had filed a Sunshine complaint against Department Head-level staff: Health Commission President Sonia Melara and Director of Public Health Barbara Garcia (who earned $259,921 in calendar year 2012). Melara and Garcia, per the Health Commission’s By-Laws, are responsible for generating the agendas for Health Commission meetings. The complaint also named the full Health Commission as Respondents.

The Sunshine Complaint — Case # 13021, Patrick Monette-Shaw/Maria Rivero, MD vs. Public Health Commission, et al. — was filed on April 18, 2013, alleging that for two decades, the Health Commission had violated both San Francisco’s local Sunshine Ordinance and the State’s Brown Act, both of which laws require that meaningful agenda item descriptions be provided for each agenda item in order to alert members of the public of important policy discussions and proposed actions that may be discussed during any given meeting, so citizens can decide whether an agenda item is of sufficient interest that they might want to attend a scheduled meeting.

The basis of the Monette-Shaw/Rivero complaint featured a deficient agenda notice for the Health Commission’s April 2, 2013 meeting, at which former LHH physician Derek Kerr was scheduled per a court order to receive a public apology for his wrongful termination and retaliation lawsuit, but which agenda had lacked any notice whatsoever that Kerr’s public apology was to take place on April 2.

As egregious and unprecedented as it was for DPH to violate terms of Kerr’s legal settlement agreement by failing to provide adequate agenda notice of the public apology mandated by Court order, thousands of agenda items over the past two decades have also contained only agenda topic titles. Lacking meaningful agenda descriptions, thousands of San Franciscans were deprived of knowing what their government via the Health Commission was doing, and to decide whether they might want to attend any given Health Commission meeting.

The Sunshine complaint should have been considered and heard by the Sunshine Task Force within 45 days from April 18; instead, the hearing never occurred until October 2, fully 167 days after it was first filed. Just 12 days before the Task Force hearing, Ms. Melara finally got around to providing a response to the complaint on behalf of the Health Commission on September 20 — fully five months after the complaint was filed.

“The Way We’ve Always Done It”

Comically, Melara tried to assure the Sunshine Task Force that the reason the Health Commission had failed to comply with both the Brown Act and the Sunshine Ordinance was because “that’s the way we have always done it,” as if past practices of how the Commission had always been done it could excuse violating the clear intent of both laws, and as if “past practices” can “trump” City and State laws to the contrary.

Melara hedged her bets, however — apparently with Ms. Garcia’s tacit approval — saying in her response that if the Task Force ruled that the Health Commission had to begin including meaningful descriptions of proposed legal settlements, the Health Commission would certainly consider changing its past practices, but only by cherry-picking among agenda items it was willing to disclose.

What Melara didn’t seem to understand was that both laws are very clear that every agenda item — not just legal settlements — have to contain a meaningful agenda item description. Melara, Garcia, and each of the Health Commissioners sign annual statements under the penalty of perjury that they have read the Sunshine Ordinance, which clearly states the requirements for meaningful descriptions for each agenda item. Ostensibly, the intent is that they not only read, but fully comprehend, the laws they are required to read under penalty of perjury, and incorporate while performing their official duties.

In an “instructional memo” sent to the Task Force on September 26 just four working days before the October 2 Task Force hearing, Deputy City Attorney Celia Lee — assigned to provide legal advice to the Sunshine Task Force — appeared to support every allegation that had been raised in this complaint.

Of the 108 agenda items listed on the Commission’s 13 meeting agendas between January and October 2, 2013, 69 percent contained just agenda titles, with no meaningful descriptions at all. Of those 108 items, 22 were action-only items, 12 were discussion-only items, and 55 items involved discussion with possible action. Among agenda items since January that were never provided a meaningful description were topics addressing “Community and Public Health Committee,” the “Community Health Improvement Plan,” the “Community Independence Project,” and “Proposed Amendments to San Francisco Health Code,” all weighty topics, among others lacking any meaningful agenda descriptions.

Given notice in April 2013 of the Sunshine complaint against them, Melara, the Health Commission, and Director of Public Health Garcia made no effort during the intervening five months to begin correcting the problem. They just kept following their “past practice” behavior with impunity, even after having been placed on notice they were violating State and local law, apparently unwilling to change past practices unless ordered to do so by the Sunshine Ordinance Task Force.

After the SOTF ruled unanimously on October 2 that Garcia, Melara, and the Health Commission had violated, and were continuing to violate, the Sunshine Ordinance and Brown Act, the Health Commission finally started publishing agenda item descriptions. Unfortunately, the new agenda descriptions are weakly-worded and may remain ineffectual.

Second Superior Court Victory: Grossman vs. St. Croix

The Westside Observer’s November 2013 editorial, “Court to Ethics’ St. Croix: Cough Up the Records,” announced Mr. Grossman’s second Superior Court victory against St. Croix and the Ethics Commission. The editorial noted that the Court ruled Grossman, not Ethics, was right on the law. This was the second time Grossman prevailed in Superior Court against St. Croix and the Ethics Commission.

This time, the withheld records involve the Ethics Commission’s Regulations for Violations of the Sunshine Ordinance (“Regulations”),which it adopted in November 2012 for implementation on January 25, 2013,

The Sunshine Task Force issues what are known as “Orders of Determination,” ruling on the facts in Sunshine public access disputes brought before it. The Orders of Determination are frequently forwarded to the Ethics Commission for enforcement (although the Ethics Commission has very rarely enforced them, and instead, wrongly re-adjudicates the Sunshine Complaints all over again, and has dismissed nearly 100% of all referrals for enforcement, the referral of Library Commission president Jewelle Gomez to Mayor Lee being the rare exception).

For years, Ethics had used its separate Ethics Commission’s Regulations for Investigations and Enforcement Proceedings” — regulations that were developed to address campaign finance and disclosure laws — to rule on access to public meetings and access to public records violations. Grossman and other Sunshine advocates had long argued that those regulations didn’t govern Sunshine Ordinance open meetings and open records enforcement violations, and that the Ethics Commission needed new, separate regulations tailored to Sunshine matters, since the latter deal with public meeting access and public records issues, not campaign finance issues.

In 2009, the Ethics Commission finally agreed, and began drafting new stand-alone regulations to address referrals for enforcement from the Sunshine Task Force and complaints filed directly with the Ethics Commission alleging willful violations of the Sunshine Ordinance’s public access provisions.

Four years later, the Ethics Commission still won’t release related records, including draft versions of the proposed regulations and communications with the City Attorney’s Office. Ethics initially worked with the Sunshine Task Force and held several joint meetings between the two bodies, seeking input to the new regulations. But that suddenly changed in September 2012 when the Ethics Commission published notice that its September 24, 2012 meeting would discuss yet another revised draft of the proposed regulations that had not been vetted with the Sunshine Task Force. Sunshine advocates objected to many of the proposed changes on September 24, but the Ethics Commission eventually adopted its new regulations in November 2012.

In an effort to seek additional information about the September 2012 final draft, Grossman placed a records request on October 3, 2012 seeking all prior drafts and the final version of the September 14 draft, and also requested the Ethics Commission’s staff report. When the Ethics Commission responded to the records request on October 12, Grossman was notified that the Commission was withholding an untold number of other documents in their entirety, citing attorney-client privilege and two types of attorney work-product protections.

Because St. Croix had failed to identify each of the withheld public records, failed to provide a written citation to justify each withholding, and Ethics’ assertion of privilege, Grossman filed a formal complaint with the SOTF on November 19, 2012. In response, during a SOTF hearing St. Croix again claimed the attorney-client privilege and attorney work-product protections, and asserted that merely citing the relevant code sections on a blanket, not case-by-case, basis was sufficient to satisfy compliance with requirements to provide written justification for each record withheld. But St. Croix was wrong on the law.

The Task Force held an extended hearing on Grossman’s complaint during its June 5, 2013 meeting and issued its Order of Determination on June 24, ruling that St. Croix had violated two sections of the Sunshine Ordinance by improperly withholding records subject to disclosure. The Task Force ordered St. Croix to produce the records to Grossman. To date, St. Croix has failed to comply with the SOTF’s Order of Determination.

Forced Into Superior Court

So Grossman was forced to sue St. Croix and the Ethics Commission for a second time in Superior Court to gain access to the improperly withheld records. In his initial 16-page Verified Petition for Writ of Mandate filed in Superior Court on September 17, 2013, Grossman asserted that none of the records he had requested were exempt from disclosure under either the California Public Records Act (CPRA) or under San Francisco’s Sunshine Ordinance. [Note: A Writ of Mandate is a court order to a government agency to follow the law by correcting its prior actions or ceasing illegal acts. When a Writ is ordered, they are typically effective immediately.] St. Croix’s refusal to provide the requisite justification for withholding and his misguided assertion of “privilege,” also constituted a violation of law, since he and the Ethics Commission had a nondiscretionary, mandatory ministerial duty to comply with Grossman’s records request, and to comply with the Sunshine Task Force’s lawful Order of Determination.

In its Superior Court response, the City Attorney’s Office submitted a 20-page Respondents Opposition to Petition for Writ of Mandate, on October 9, 2013 authored by Deputy City Attorney Andrew Shen.

It’s the worst legal filing this columnist has ever had the displeasure of reading, since it starts out indicating Grossman’s case “raises the question of whether a municipality’s voters acting in their legislative capacity may, by ordinance, override the laws of attorney-client privilege and work product doctrine set forth in state statues and rules of professional conduct incorporated into a City charter.”

That’s complete rubbish — of course voters can! — but Shen’s Opposition brief quickly went downhill from there. He painted a picture that the City Attorney couldn’t fulfill his obligations to protect client confidentiality if a “mere” ordinance could bar City officials from asserting attorney-client privilege or from asserting attorney work-product privilege in a “broad swath” of unrelated legal matters.

Shen wailed that the City Attorney’s ability to fulfill his mission of advising City officials would be seriously compromised. Shen wasted 10 of his 20 pages addressing attorney-client privilege and attorney work-product privilege issues to argue that voters can’t enact restrictions on the City Attorney, ignoring that seven states have already abolished government attorney-client privilege, particularly when it only involves communications between a government attorney and his government client.

The reason these states have abolished government attorney-client privilege is due in large part to the diminished expectation of confidentiality in the public sector, and democratic values disfavoring secrecy in government. There is strong evidence — as St. Croix and Herrera must surely know — that suggests attorney-client privilege is not a necessity for effective communication between government officials and their attorneys, undermining any rationale that invoking this privilege in a government context is ever justified.

When the “client” is a government body, bestowing this privilege to it appears particularly perverse, since the privilege is then used all too often to withhold information from the very citizens the government body represents.

The strong public interest in seeking honest government and exposing wrongdoing by public officials is ill-served by allowing attorney-client privilege in inquires into actions of public officials. Many believe allowing City Attorney’s to use attorney-client privilege as a shield against production of public records is a gross misuse of public assets.

Shen admitted that St. Croix had withheld 28 documents from Grossman for over a year, and announced that upon further review, four of the 28 — 14.3 percent — were “determined not to be subject to” either attorney-client privilege or attorney work-product privilege. The four documents were provided to Grossman on the same date Shen filed the City Attorney’s response to Grossman’s lawsuit in Court. Had Grossman not sued, St. Croix would have gotten away with withholding the four documents that weren’t even legally privileged.

The “Work-Product” Canard

Indeed, Shen’s separate Declaration effectively admits that none of the withheld records involved work-product; it appears they are simply attorney-client communications. Of the remaining 24 documents withheld, 15 documents, mostly e-mails, involve requests from the Ethics Commission staff to the City Attorney’s Office for legal advice on the proposed Ethics regulations. The remaining nine appear to be City Attorney responses to those requests providing advice regarding the proposed regulations, including one dated May 6, 2010 that analyzed legal issues implicated by the Commission’s proposed Sunshine regulations.

And Shen’s Declaration — separate from his Respondents Opposition brief — says nothing about the work product doctrine, even though he goes on and on about work product in the Opposition brief. Shen’s Declaration impliedly admits that the 24 documents that remain in dispute are subject to the attorney-client privilege, so none may be subject to work-product privilege.

Then Shen launches into an all-out attack on Sunshine Ordinance §67.24(b)(1)(iii), which simply states that any City Attorney communications providing “advice on, compliance with, analysis of, or an opinion” concerning CPRA, the Brown Act, San Francisco’s Ethics Code, or the Sunshine Ordinance are public records subject to disclosure. Shen claims this section “purports to bar,” the City from asserting attorney-client privilege and wrongly claims the City Attorney would be prohibited from providing legal advice to City officials, when in fact, this section only stipulates that any such legal advice to City officials are, by definition, public records that must be disclosed. It doesn’t prohibit the City Attorney from anything — other than prohibiting withholding the records from disclosure.

But Shen twisted §67.24(b)(1)(iii) into something it is not, and railed throughout the remainder of his Opposition brief that the section attempts to “alter or limit the provisions of” the City Charter, and that this section of the Sunshine Ordinance cannot be enforced. In the Court Order handing Grossman his second victory against St. Croix, Judge Goldsmith denied Shen’s request to strike down §67.24(b)(1)(iii), noting that this issue was not properly before the Court in Grossman’s motion for writ of mandate.

Attorney Ng to the Rescue

In stark contrast to Shen’s misguided and rambling Opposition brief, Grossman’s lawyer Michael Ng submitted a brilliant rebuttal in his 14-page Petitioner’s Reply in Support of Verified Petition for Writ of Mandate.

Ng began by noting Shen’s claim that voters are powerless to adopt laws requiring that public officials disclose public records involving communications with the City Attorney, is unfounded, and untenable; Ng notes voters are the ultimate authority and can exercise plenary power over the City’s legislative affairs. It’s clear that Sunshine §67.24(b)(1)(iii) says City Attorney communications — from the outset — are not confidential, and that communications that were never confidential cannot be subject to the attorney-client privilege.

Ng then noted CPRA expressly authorizes local governments to adopt requirements like §67.24(b)(1)(iii) providing greater access to public records in order to shrink the islands of privacy [in a sea of government secrecy], by precluding San Francisco from invoking exceptions when the public records concern a narrow set of law relating to public records access itself. He also notes San Francisco voters expressly approved these “enhanced rights of public access to information and records.”

Ng observed that the City — by extension City Attorney Dennis Herrera and St. Croix — has not challenged other provisions of §67.24 that also preclude San Francisco agencies from asserting other CPRA exemptions. It’s clear to most observers that St. Croix and Dennis Herrera are not so concerned with §67.24 overall, as they suddenly are with the implications of §67.24(b)(1)(iii). Ng rightfully asserted Shen’s contention that the latter citation would prevent Herrera from carrying out his City Attorney duties is a gross exaggeration, since that section merely provides that City Attorney communications regarding open government laws remain accessible to the public.

Why the City is suddenly seeking to strike §67.24(b)(1)(iii) from San Francisco’s administrative code 20 years after it was added to the Sunshine Ordinance in August 1993 and adopted by voters in November 1999, isn’t known. Observers suspect the City now wants it struck down simply because Grossman appears to be the first San Franciscan to have successfully sued for its enforcement in Superior Court. As long as nobody had sued for enforcement, the City appears to have let §67.24(b)(1)(iii) stand for 20 years.

St. Croix and Herrera brazenly asked the Superior Court to strike it down when Grossman found the chutzpah — referred elsewhere to as the “audacity of hope” — to challenge the shameless pair of Herrera + St. Croix in court.

Specifically, §67.24(b)(1)(iii) is “no more an attack on the attorney-client relationship than the Brown Act’s mandate public meetings be conducted in the open,” Ng declared. Indeed, the Brown Act mandates that most attorney-client communications with a local legislative body take place in open session, Ng observes. The Brown Act acknowledges the relationship between a local body and its attorney does not require secrecy when it is outside the context of pending litigation.

Dennis Herrera’s Public Spanking

Ng acknowledged that St. Croix and the City Attorney had, in effect, asked the Superior Court “to create new law by carving out an exception to the express terms of the Sunshine Ordinance.” San Francisco voters had decided such City Attorney advice must be provided in the open.

Ng notes that the City Attorney’s blanket repeated assertions of privilege without providing any substantive rationale, may be evidence of the City’s strategy of stonewalling and evasive responses. Individuals seeking public records under CPRA or the Sunshine Ordinance should not have to burden the Court to obtain compliance with either law.

At issue here is that the drafting of procedural regulations — such as the Ethics Commission regulations in Grossman’s second lawsuit — is a legislative function. As such, it’s a process that should be open to members of the public, including candid, honest, and complete legal advice in connection with the regulations, unimpeded by objections to disclosure.

When voters speak through the ballot box, any power to waive “privilege” dissolves, since City Charter §14.100 grants voters the power to enact initiatives, and the power to nullify measures involving legislative matters by referendum. Witness the November 5 election in which — by referendum — voters nullified the legislative decision of the San Francisco Board of Supervisors to grant the 8 Washington project a height exemption when voters rejected Prop C. And witness the voter’s adoption of the Sunshine Ordinance as a valid exercise of their authority to enact an ordinance restricting the secrecy permitted at City Hall.

St. Croix’s argument that the City Charter’s designation of the City Attorney as his counsel somehow trumps the voters’ specific adoption that certain records must be made public holds no water, Ng noted. Whatever relationship exists between a general provision of a City Charter and a detailed specific enactment by voters, the fact that the pertinent section at issue was authorized by express State law renders the debate of no significance.

Both St. Croix and Dennis Herrera had to have known that State law expressly permits adoption of stricter open records rules supersedes local law, since State law appears to supersede even City charters. The SOTF’s Order of Determination against St. Croix and the Ethics Commission was a lawful, binding order, which the Superior Court had authority to enforce. So it did, handing St. Croix and Dennis Herrera an embarrassing public spanking.

Ordered to Comply, the City Appeals Instead

Judge Ernest Goldsmith’s Order Granting Petitioner’s Writ of Mandate in Grossman’s favor, dated October 25, 2013 states that “the record shows that Respondents [St. Croix and the Ethics Commission] had not met their burden [proving] that the withheld documents are exempt under the [CPRA] and the San Francisco Sunshine Ordinance” [emphasis added]. Goldsmith reached the same conclusion that the Sunshine Task Force had reached on June 5 almost five months earlier, nearly a year after Grossman had been forced to file his Sunshine complaint.

Goldsmith noted that under the Sunshine Ordinance, public records regarding advice on CPRA and the Sunshine Ordinance are, in fact, subject to disclosure, citing §67.24(b)(1)(iii) as the basis. This had to have disappointed Mr. Shen and City Attorney Dennis Herrera. The judge noted Shen had conceded the 24 documents withheld from Grossman consist of requests from Ethics Commission staff for legal advice and the City Attorney’s responses analyzing the legal issues.

Goldsmith ordered St. Croix to deliver the remaining 24 documents to Grossman. Goldsmith also denied Shen’s request to strike §67.24(b)(1)(iii) from the City’s Administrative Code.

Clearly desperate to stop Allen Grossman’s victory due to potentially far-reaching implications should he prevail, the City filed a Motion to Stay the Superior Court’s order in the Court of Appeals First Appellate District on Friday, November 22. The Appeals Court granted the Stay pending resolution of the writ proceedings on the same date, despite the fact that Superior Court Judge Goldsmith had ruled in the “trial court phase” that the City and St. Croix had not met their burden of proof that additional records St. Croix had withheld are exempt under the CPRA or under San Francisco’s Sunshine Ordinance. It’s somewhat surprising that the Appeals Court didn’t give Grossman a chance to respond to the Motion to Stay before it granted Shen the stay.

The City’s request for the stay of enforcement was unavailable at the deadline to submit this article to the Westside Observer for its December issue. So it’s not yet known what new, creative legal theories the City and Mr. Shen may have introduced in their Stay to fight Grossman’s Superior Court victory.

The Appeals Court may potentially dismiss the writ summarily, but it may also wait for a full briefing before deciding whether to dismiss the Superior Court’s Writ. Hopefully, the Court will wait for a briefing. Grossman’s court briefs responding to the Motion to Stay are due December 23, and the City’s reply to Grossman’s response is due on January 7, so it will take another two months before the Appeals Court rules on the City’s appeal.

Meanwhile, St. Croix’s Superior Court costs continue to balloon. A subsequent public records request has revealed that in Grossman’s second Superior Court case, the City Attorney’s Office has already racked up 213.5 hours of time at the Superior Court level, at a cost of $51,178 plus $145 in expenses, fighting Grossman over a mere 24 documents. Just through the Superior Court phase, that’s $2,138 per withheld document — and growing, since it is not yet known how much Grossman’s lawyer may request from the Court in attorney’s fees, nor is it yet known how much the City will eventually rack up in costs fighting Grossman during the Appeals process.

Courts have noted the unique responsibility of government attorney’s such as Dennis Herrera to not only serve the government entities he represents, but also the public interests of citizens he serves. Herrera appears to hold no obligation to the voters who elected him, or to his duty to provide transparency and openness in San Francisco’s government. He appears to believe his sole responsibility is protecting City officials from exposure of wrongdoing.

To date, Grossman’s two Superior Court lawsuits have cost the City nearly $100,000, and is mounting — all because of St. Croix’s and Herrera’s needless battles against access to public records. The wasted money — significant and unnecessary costs — is an obscene amount for City Attorney Herrera to spend in the name of government secrecy.

Dennis Herrera — who sought re-election on November 5 unopposed — just doesn’t seem to get it that San Franciscans want more Sunshine and transparency from City Hall, not more secrecy from our City Attorney.

Monette-Shaw is an open-government accountability advocate, a patient advocate, and a member of California’s First Amendment Coalition. Feedback: monette-shaw@westsideobserver.com

December 2013

SF General Hospital rebuild showing progress
Progress at SF General’s new Hospital and Trauma Center
does not include a dialysis center

Committed Citizens Changing the World

A Victory for SFGH’s Dialysis Patients

American cultural anthropologist Margaret Meade’s famous dictum — “Never doubt that a small group of thoughtful, committed citizens can change the world; indeed, it’s the only thing that ever does” — played out when citizens sought suspension of an RFP to privatize the Health Department’s outpatient dialysis center at SFGH by outsourcing it to a private company that would be required to build it out in a current “shell” in Laguna Honda Hospital’s (LHH) old, and questionably seismically-safe, buildings.

it was decided outpatient dialysis wasn’t considered an “essential” service.  The Health Department appears to have forgotten that dialysis is essential to the continued lives of its dialysis patients.”

When the suspension of the RFP to outsource DPH’s dialysis services occurred unexpectedly during a Board of Supervisors hearing on October 17, it occurred because a small group testified why outsourcing dialysis to the private sector was a really, really bad idea.  Members of the Board of Supervisors opposed to privatization listened, and stopped the proposal.

Dialysis Privatization:  Dead on Arrival

The 40-plus citizens who attended the Board of Supervisors Neighborhood Services and Safety Committee hearing on October 17 presented compelling testimony regarding why dialysis services should remain on SFGH’s campus, rather than being privatized and outsourced to LHH, echoing many of the concerns first reported in the Westside Observer’s October article “Department of Public Health’s Dialysis Crisis.”

The group included family and patient caregivers, SFGH Renal Center staff, dialysis patients themselves, and other patient advocates.  No one spoke in support of relocating dialysis services to LHH other than hospital administrators. 

During the hearing called by Supervisor David Campos, SFGH’s Chief Operating Officer Roland Pickens asserted that dialysis services were not included in the plans for the replacement acute care hospital building now under construction because it was decided outpatient dialysis wasn’t considered an “essential” service.  The Health Department appears to have forgotten that dialysis is essential to the continued lives of its dialysis patients.  Supervisor Campos asked Pickens who had made that decision; Pickens indicated the decision had been made by the Mayor and Health Commission at the time planning for the SFGH rebuild bond measure was being developed.

In response to a direct question from Campos about whether the RFP to move dialysis had been discussed and voted on by the Health Commission, Pickens stated unequivocally that “Yes, it was” voted on by the Health Commission, which is a complete fabrication, since Pickens was fibbing.  Campos pushed harder, and asked again if the Health Commission had voted on an RFP to privatize dialysis services, and Pickens again claimed that from his recollection, it had been voted on.  More fibbing.

But as the Observer reported last month, the discussion to outsource dialysis to LHH was only discussed in the Health Commission’s subcommittee — the SFGH Joint Conference Committee (JCC) — in the Spring of 2012, with only the barest subcommittee “report back” to the full Health Commission.  The full Health Commission did not discuss the “report back” in any depth, and the full Health Commission has not scheduled a distinct agenda item regarding outsourcing SFGH’s dialysis services during the past two years of its meetings.

Before Pickens chose to fib, a records request for any vote of the Health Commission had already resulted in a response that there are no responsive records, indicating the full Health Commission never debated merits of the RFP and took no vote on whether to approve the dialysis privatizing RFP before it was issued.

Admission:  Not All Options Were Studied

When Campos asked Pickens whether the $5 million it will cost to build out dialysis at LHH could be better spent on renovations of SFGH’s campus to keep dialysis there, Pickens openly admitted SFGH had not looked at an option to spend that money on renovating space at SFGH.  When Campos asked whether any options had been considered to stay in the current vicinity, if not on the SFGH campus itself, Pickens claimed the City’s Real Estate Division had explored leasing space elsewhere, but none met requirements.  When asked if Real Estate had prepared a report about other options, Pickens said he would have to go back and look for that.

As the Observer reported last month, Director of Public Health Barbara Garcia had been asked by the Health Commission to submit a report of all viable options to keep dialysis services at SFGH.  According to a records request, it appears Garcia never provided the Health Commission — let alone the Board of Supervisors — with a report that had investigated all possible options to prevent moving dialysis services off of SFGH’s campus.

When the hearing explored the burdens of increased transportation times for vulnerable, sick dialysis patients who would have to travel further to get to LHH, Campos asked Pickens if the patients had been surveyed about the impact to their care.  Pickens answered “No, we did not.”  Campos asked “Why would you not talk to the [patients] who are going to be … the most impacted by moving” dialysis to LHH.  Pickens admitted that in hindsight, DPH should have done that, and that it was a mistake they made not surveying patients.  Pickens stated DPH will make sure they survey dialysis patients regarding transportation issues.  Pickens agreed with Campos that if a survey of patients reveals that moving dialysis to LHH is not the right move, DPH would “absolutely” reconsider its decision to move dialysis to LHH.

Campos noted how disrespectful it was to patients who were not consulted prior to release of the RFP.  Near the end of the hearing, Pickens apologized to patients that “we have not had a conversation with you.”

Even though Health Commissioners David Sanchez and Edward Chow had indicated in 2012 that transportation would be addressed in the RFP, Pickens admitted to Campos that transportation had not been addressed in the RFP, but that DPH “can go back and make [transportation] a part of the [RFP] process.”

Campos appeared incredulous that DPH had not performed any analysis of a potential decrease in revenue from other medical services if patients outsourced for dialysis then choose to receive other services — for example, vascular surgery, radiology, etc. — by obtaining those services from other providers, rather than returning to SFGH to obtain other primary and specialty-care services.  DPH is fully aware that it will be “competing” in the managed care arena for patients, so why it didn’t perform a cost-benefit analysis of potential unintended consequences of losing additional revenue is rather shocking.  In addition to the millions of dollars in lost dialysis revenue that benefits SFGH, DPH would also run the risk of losing additional millions from other medical services, but this appears never to have been studied.

Sadly, given DPH’s many highly-paid bean counters, it’s even more shocking that it didn’t occur to any of DPH’s or SFGH’s administrators and hospital administrators that they should ask the bean counters to run a lost-revenue “what if” scenario to estimate how much potentially-lost revenue might be at stake.

The “Fib” LHH Is Seismically Safe

Pickens also testified that DPH considers the space where dialysis would have been placed in LHH as seismically safe, despite the fact that the only seismic remodeling of LHH’s old buildings included replacing an unknown number of hollow-clay walls with concrete walls, but no lateral bracing for lateral shift during an earthquake.

When the hearing was opened for public testimony, the first speaker was Vivian Imperiale, a 10-plus-year former employee at Laguna Honda Hospital, who rhetorically asked who had decided that LHH was a suitable place for dialysis patients, given that voters were told much of the old buildings would be demolished as being seismically unsafe.  She noted a lawsuit may be waiting to happen if a patient receiving dialysis turns out to be a “sitting duck” injured (or killed) in LHH’s old buildings during an earthquake.  Speaking against moving dialysis services to LHH, Ms. Imperiale testified “Let us remember that change is not synonymous with improvement.”

Following testimony from a staff member of the Dialysis Center that showed life-safety regulations for fire sprinklers were relaxed in 2012, grandfathering buildings built before January 2008 to operate without them, Campos inquired whether that permitted DPH more flexibility.  Mr. Pickens replied that if that proves to be the case, SFGH might pursue it as an option to keep the facility right where it is currently located at SFGH.

In effect, should Mr. Pickens finds that this proves to be the case, the inescapable conclusion is that DPH didn’t consider, Barbara Garcia didn’t “explore” or report back on this potential option, and the Health Commission may not even have known of this option, given Garcia’s non-existent repot back concerning “all” options.

It was clear by the end of the hearing that Pickens understood that the Board of Supervisors wants to keep dialysis services on SFGH’s campus.  It also appeared clear that Pickens got the message that the Supervisors do not want DPH to come back with a replacement RFP now or anytime soon to move dialysis elsewhere.

Campos noted that the proposal to move dialysis to LHH appeared to conflict with the Health Services Master Plan that the City just adopted, noting that Master Plan Recommendation 1.1 meant to address social and environmental factors that impede or prevent access to optimal care, as the increased burden of transportation surely would.  Campos also noted that the RFP appeared to violate Master Plan Recommendation 3.1 meant to increase access to appropriate care for San Francisco’s most vulnerable patients.

At the end of the hearing, Supervisor Campos summed up by asking Mr. Pickens that, “In terms of clarity, does it mean that right now, the dialysis services will stay at the current center until a decision is made otherwise,” to which Pickens responded “Yes, we will suspend the [current] RFP process.” 

For further clarity, Campos then asked “So the process is suspended and you will not be making a decision to privatize [dialysis] services at this point?” to which Pickens replied, “That is correct.”  Campos then asked if a decision is made in the future to go down the route of privatization, whether there would be a separate and new RFP process, to which Pickens responded, “This is correct, absolutely.”

[Editor’s Note:  On October 22, shortly before the Observer was going to press for this November edition, DPH’s Contracts Office responded to a records request, announcing the dialysis outsourcing RFP was suspended as of October 22.  Patient advocates, and patients, would feel more comfortable if DPH’s announcement had indicated the RFP had been cancelled completely, not just suspended.]

Ms. Imperiale commends Supervisor Campos’ and Mar’s decision not to outsource and relocate the SFGH dialysis center off campus.  “The conduct of both Supervisors during the hearing demonstrated their ability to analyze proposals, ask very relevant questions, truly listen to impassioned testimony, and respect those who came forward to give public comment,” Imperiale says.

“Their professionalism, concern, and sound judgment were the epitome of what we like to expect from our elected officials,” she adds.

It was clear as the hearing was formally “filed” before adjourning, that any dialysis relocation plans have been put on hold and that the current RFP to move dialysis to LHH was completely dead on arrival.

At that point, a cheer went up in Board Chambers from the small group of 40 thoughtful, committed citizens who had just changed the world of dialysis patients treated at SFGH.

Monette-Shaw is an open-government accountability advocate, a patient advocate, and a member of California’s First Amendment Coalition. Feedback: monette-shaw@westsideobserver.com.

November 2013

Department of Public Health’s Dialysis Crisis

’Round the Circle-Game We Go

PUBLIC NOTICE: Annual Meeting of the Public Health Commission at Laguna Honda Hospital

Adoption of LHH’s annual report • Tuesday, October 15, 2013, 4:00 p.m.

Included: public discussion of the use of the former old buildings at LHH. Initially slated for demolition, there may be a discussion of reuse of the old “finger wings” for other uses rather than demolition.

The meeting will be held in the John Kanalry Meeting Center in the new new hospital's Pavilion Building; seating is limited..

For more than 46 years, dialysis services have been admirably provided on the campus of San Francisco General Hospital.  But in a move to privatize every public service it can, the City is making a dire mistake outsourcing dialysis to the private sector, and placing it at Laguna Honda Hospital.

The vast majority of dialysis patients treated
at SFGH are African-American, Hispanic, or
Asian/Pacific Islanders, most of them already
facing disparities in access to medical care.”

Although the Department of Public likes to boast that it is “integrating” patient care between SFGH, LHH, and it’s many community-based clinics throughout the City, DPH is about to fracture the delivery of services for dialysis patients who have been treated on SFGH’s campus for nearly half a century, after the State of California first awarded a grant to UCSF’s Medical Center to establish the UC Renal Center at SFGH in 1967.

woman getting dialysisFollowing the dialysis center’s opening shortly after receiving the State’s grant, it has faced a growing circle of licensing and financial-loss problems, and then faced chronic indecision regarding its fate from UCSF, SFGH, the Department of Public Health, and mostly from San Francisco’s governing Health Commission.

Coming full circle, the decision to outsource dialysis services to an outside contractor and place a 30-chair outpatient dialysis center in Laguna Honda Hospital’s seismically unsafe old main buildings is extremely troubling, when not potentially dangerous to patient safety, as the Observer first reported in our September issue ("Squished Together: Misery Visits Company").

The Licensure Circle

After operating the UC Renal Center at SFGH for 33 years, the broader UCSF Medical Center notified SFGH in 2001 that it would no longer license the Renal Center at SFGH.  A year later, UCSF’s Department of Medicine at SFGH luckily stepped in and became independently licensed to operate the UC Renal Center at SFGH.  But a year following that, in 2003 UCSF’s Department of Medicine unsuccessfully tried to sell the facility, or partner with a private company, due to its financial losses.  So in 2003, the facility and its license were transferred to SFGH, and the unit was renamed the SFGH Renal Center, where it has operated for the past decade.

And during that same past decade, since Katie Worth published several articles in the San Francisco Examiner in 2004 about the chronic shortage of dialysis services all over San Francisco in both the public and private sectors, debate — and constant indecision and delay — has raged about placing dialysis services at LHH, despite initial plans to rebuild both LHH and SFGH without any dialysis services in either of the replacement hospitals.

A current Request for Proposals to outsource SFGH’s dialysis services specifically requires that the entity who is awarded a ten-year contract will be responsible for obtaining licensure to operate outpatient dialysis services at LHH.  As far back as 2007, the State agency that issues licenses for dialysis services prohibited long-term care nursing facilities from operating a dialysis center on site.  But in early 2007, the State Assembly quickly authored AB 214 to permit long-term health care facilities to provide chronic dialysis clinic services to residents of their facilities.  Notably, AB 214 did not authorize the skilled nursing and long-term facilities to operate outpatient dialysis centers, just services for inpatient residents.

By 2009, the State Assembly introduced AB 1544, to expedite approval of new outpatient clinics without a prior onsite survey, but the bill initially would have prohibited acute care hospitals, psychiatric hospitals, and specialty hospitals from providing new outpatient services for chronic dialysis treatment.  As AB l1544 wound through the State Senate, amendments to the bill on September 4, 2010 struck out the prohibition restricting outpatient dialysis services from the bill.

To our knowledge, LHH has never tried to obtain any license to provide dialysis services, and indeed, its current license and menu of “clinics” does not include inpatient dialysis.  Notwithstanding its lack of license for dialysis services, change orders were eventually approved during construction of LHH’s new facilities, adding a six-chair dialysis center that was built out on the promenade in LHH’s new Pavilion building, and dialysis chairs and equipment were purchased and delivered, although the small inpatient dialysis clinic has not opened in the three years since LHH moved into its new digs.  Many of LHH’s current and former staff were never informed the six-chair dialysis unit was even there waiting to be opened, but never was. As a result, LHH’s dialysis patients still endure being transported to SFGH’s Renal Center for treatment.

Sources report that despite the construction of a six-chair inpatient dialysis center in LHH’s new Pavilion building, former Director of Public Health Mitch Katz would not allow LHH to open it, for fear of taking away business from SFGH.  “Doctors don’t like losing dialysis patients because the business is very lucrative, and competition for Medicare patients is fierce,” a former LHH physician speaking on condition of anonymity notes. 

Similarly, LHH’s expansion of its acute physical medicine rehabilitation beds to 15 never panned out, as this reporter previously predicted might fail, because competition for acute rehab patients is also cut-throat among private hospitals.  LHH’s share of the acute-care physical medicine rehab patient pie typically hovers at an average of no more than two at any given time, given the fierce competition for Medicare Part A acute rehab patients. 

After receiving an additional $1.5 million or more annual budget increase to increase staff for a 15-bed acute rehab center planning to compete for Medicare Part A revenue that LHH’s Chief of Rehabilitation Services Lisa Pascual, MD asserted would occur —and which budget increase was approved by a beguiled Mayor and Board of Supervisors — LHH hasn’t been able to fill up more than half of its currently-licensed five acute rehab beds (not 15) at any one given time.  LHH has failed so far to increase its grasp of the acute-care rehab reimbursement pie.

Lamely, a presentation to the SFGH Joint Conference Subcommittee on February 14, 2012 presented by SFGH’s CEO, Sue Currin and others, claimed on the “Funding Plan” slide that the six-chair inpatient dialysis unit was dropped from LHH’s rebuild plans in 2008 due to the projected high operational costs.  But why would they have built out the six-chair unit and had the equipment delivered in 2010 if it had already been dropped in 2008?  Knowledgeable sources believe it was never dropped from the plans, but that Dr. Katz refused to let it open and Currin was merely spouting spin control in 2012.

The Really-Bad-Location Circle

There are a number of reasons why moving SFGH’s dialysis center to Laguna Honda is a really bad location.

First, and foremost, it will fracture the care of dialysis patients, who attend multiple primary- and specialty-care appointments at SFGH each month, in addition to their weekly dialysis sessions.  SFGH’s dialysis patients are among the most vulnerable in the City, suffering from ESRD, diabetes, congestive heart failure, cancer, HIV/AIDS, heroin addiction, and tuberculosis.  Many patients require multiple SFGH-based clinic appointments, along with their three- to four-hour dialysis treatments three times a week.

The vast majority of dialysis patients treated at SFGH are African-American, Hispanic, or Asian/Pacific Islanders, most of them poor people already facing well-known disparities in access to medical care.

SFGH is the only dialysis unit in the city that accepts patients on gurney’s and from other community skilled nursing facilities who cannot ambulate due to quadriplegia, stroke, and vascular disease.  It is also the only dialysis unit that accepts patients with aggressive behavioral issues who have failed at, or have been terminated by, other dialysis units in the City, and it is the only dialysis unit that accepts incarcerated patients needing dialysis who have lost medical insurance once in jail.  It is the only unit in the City that dialyzes behavioral health patients (e.g., schizophrenia) and those requiring 24-hour care at SFGH’s secure facilities, since attempts to dialyze them at other units were unsuccessful, disruptive to other dialysis patients and staff, and costly, incurring both transportation costs and costs of safety “sitters” to accompany patients.

SFGH’s Renal Center dialyzes patients who can’t be referred to private centers, including those with paralysis, those on breathing tubes, and those who are ineligible for insurance.

In December 2011, SFGH’s Renal Center received additional funding to staff a fourth evening dialysis shift specifically to address the problem of uninsured patients who are kept in the hospital at huge expense, because no other units in the City will accept them and the Renal Center did not have open chairs.

What will happen to all of these patients, since there is nothing in the RFP that stipulates that the vendor awarded the contract to operate a dialysis center at LHH will be required to accept these types of patients?

Moving the service to LHH will require these patients to obtain care at multiple locations, fragmenting their care between locations, and increasing the odds that they may end up admitted to SFGH’s emergency room.  Many dialysis patients see multiple providers at SFGH during their dialysis visits, so they may end up making multiple trips to different campuses each week to receive fragmented care.

Second, the current Renal Center at SFGH formerly used ambulance transport when patients experience a medical emergency during dialysis treatment.  Then, Renal Center staff learned they could use SFGH’s “Medical Emergency Response Team” (MERT), to use wheelchair transports from Ward 17 in Building 100 where the Renal Center is located, to transport patients by wheelchair quickly to the SFGH's E.R. along hallways in SFGH’s current main hospital in Building 5.

But there is no MERT at LHH, and the best LHH may offer be able to offer is use of its medical-staff Code Blue Team, who will have to travel a long distance on LHH’s campus from the new buildings were they see patients, over to the old main building where the outpatient dialysis center is proposed to be placed on the third floor.  Alternatively, should patients Code Blue during dialysis treatment at LHH, following a delay in calls to 9-1-1, not only will there be an increase in fire alarms going off, the Fire Department station on Olympia Way behind LHH has no access road to LHH, and fire engines will be a three-minute ride away, barreling down Clarendon Avenue sirens ablaze, then along Laguna Honda Boulevard, before they can turn onto the grounds of LHH.  If a Code Blue patient needs transport to the E.R. at SFGH, factor in at least a 10- to 15-minute trip to Potrero Avenue, causing further delays in care en route

It is thought that SFGH’s MERT team is summoned to its Renal Center an average of three to four times a month for emergency transport, and Code Blue’s occur about six times annually.

Third, moving dialysis services to LHH will exacerbate transportation burdens.  Studies have long documented that patients have poorer outcomes the farther they have to travel to a dialysis center.  MediCal no longer reimburses for van transportation, although MediCare does (and it is thought about 40 percent of SFGH’s MediCare patients are quickly referred to other off-site dialysis centers, and aren’t in SFGH’s on-site dialysis patient mix).  Anthem Blue Cross, which provides managed MediCal, does not reimburse for transportation, nor does it reimburse for some dialysis-related medications.  It is not yet known whether the San Francisco Health Plan or the separate Healthy San Francisco programs cover transport costs.

Presentations made by DPH to the full Health Commission in February and April 2012 document that of 97 dialysis patients being treated at SFGH, 33 rely on public transportation, only 40 had an “entitlement van,” 4 rely on gurney transport in an ambulance, three walk, 12 have private cars, one is transported from jail by the Sheriff, and 4 were behavioral health patients presumably at SFGH’s Mental Health Rehab Facility at SFGH. 

Worse, DPH’s presentation also noted that of 33 dialysis patients treated at SFGH who rely on public transportation, fully 26 (79 percent) reside in five zip codes in the Inner Mission, Bay View-Hunters Point, South of Market, Outer Mission, and Tenderloin neighborhoods, who will face an increase of 2.3 to 3.8 miles in public transportation to LHH, presumably with longer transit times, particularly from the Inner Mission and Bay View-Hunters Point.

As far as that goes, of the 97 dialysis patients seen at SFGH, fully 86 (89 percent) are from these same five neighborhoods, plus Bernal Heights and the Excelsior.  Of SFGH’s additional 132 patients treated off site in the community, fully 98 (74 percent) are from these seven neighborhoods.  Whether the 132 use public transit or other transportation, they will all face longer transportation times, in addition to their three- to four-hour dialysis treatments — assuming there are no delays in treatment that may affect missing scheduled van transport times for return home. 

Patient advocates fear SFGH’s dialysis patients may not be able to endure two-hour bus rides, three times a week for dialysis.

Data in the presentation to the Health Commission is echoed by dialysis caregivers throughout the City.  SFGH Renal Center staff have testified at Health Commission meetings that 90 percent of their patients live on the East Side near SFGH.  They testified that the Laguna Honda site will pose access issues for Renal Center patients, all of whom receive primary and specialty care at SFGH.  They don’t believe any SFGH outpatient services should be moved to LHH. 

They note moving the Renal Center to LHH will mean increased van, car, ambulance, and pedestrian traffic in the LHH neighborhood.  With just 99 dialysis patients treated three times each week (assuming that dialysis patients currently treated at community sites will remain where they are, despite DPH’s hope to move them to LHH, which likely won’t happen), there would be fewer than 198 round-trip transports three times each week, but there will still be a high number of vans running through the LHH neighborhood daily, which increase in traffic may not have even been considered when the Environmental Impact Report was prepared prior to construction of LHH’s replacement facility.  This excludes SFGH’s 132 patients who are currently served off-site, and may or may not be forced to switch from community-based dialysis clinics, to LHH, which may exacerbate their transportation problems, and who may also be forced to change their nephrologists.

During testimony at the SFGH Joint Conference Subcommittee meeting of the Health Commission February 14, 2012, one member of the public testified that LHH was too far away, which may deter patients from getting the appropriate care; he read a letter into the meeting minutes from a medical transport company who stated that it can’t afford to transport patients to LHH due to lower reimbursement rates from MediCare.

The Chronic Indecision Circle

There has been little to no public discussion of the pros and cons of outsourcing SFGH’s dialysis services to LHH.

There has been no substantive discussion of the RFP to move dialysis to LHH at the full Health Commission.  In response to a records request placed by this columnist on September 14, 2013, Health Commission Executive Secretary Mark Morewitz responded that there were no responsive documents to a records request for any “Resolution” adopted by the full Health Commission authorizing DPH to issue an RFP to outsource and privatize the Renal Center at SFGH and relocate those services to LHH. 

Nor were there any responsive records for meeting minutes of the full Health Commission in which it formally approved DPH’s proposal to relocate the dialysis services to LHH.  Morewitz also noted that there were no responsive documents to a request for any DPH budget initiative forms to eliminate dialysis services; he indicated no reductions have been made to the DPH outpatient dialysis budget.  At least not yet.

Mr. Morewitz creatively tried to assert that DPH’s “outpatient dialysis services located at SFGH are currently  ‘outsourced’ to UCSF.”  But it is thought that he’s stretching the truth, because the license for SFGH’s Renal Center resides with SFGH, not with UCSF.  Although the Renal Center is staffed with UCSF employees, so are large areas throughout the SFGH medical center campus, and the employees are staffed under a so-called (and financially lucrative) “Affiliation Agreement” with UCSF, which is typically afforded cost-of-living and cost-of-doing business budget increases each year funded by DPH’s budget through the City’s General Fund.  Unlike the Affiliation Agreement now in place to staff the SFGH-licensed Renal Center, the pending RFP will actually outsource the entire operation, including licensure, to an outside entity, even though the UCSF Department of Medicine’s Nephrology Division will retain control of “medical direction” for any outpatient dialysis center at LHH.

Morewitz did, however, send along minutes of the Health Commission’s SFGH Joint Conference Subcommittee meetings on held on February 14, 2012 and April 10, 2012.  Scattered throughout both SFGH JCC minutes, Health Commissioner Sanchez, PhD and Commissioner Ed Chow, MD, repeatedly requested that DPH “explore all possible options and postpone the release of the RFP [to move dialysis to LHH] until Director [of Public Health Barbara] Garcia reports back to the SFGH JCC regarding this issue.” There’s no indication Ms. Garcia ever reported back. 

For his part, Sanchez requested on February 14 that “DPH consider exploring other options so that outpatient dialysis services could remain on the SFGH campus, and another unit could be located at LHH” in order to continue serving safety-net patients if outpatient dialysis is moved to LHH.  Despite postponing release of the RFP, it appears to have been issued, apparently without the requested report back from Garcia.

The minutes of the full Health Commission on April 17, 2012 report the SFGH JCC was “hopeful” a solution could be found regarding appropriate transportation to the new site for [dialysis] patients” at LHH.  This followed Dr. Chow’s helpful “suggestion” to ensure patient transportation be “part of the plan” in the SFGH JCC’s minutes of April 10, 2012.  Unfortunately, the RFP to outsource dialysis to LHH mentions not one word about transportation issues, and the issue appears to have never crossed the lips of Barbara Garcia and the Health Commission before the RFP was issued, unless such conversations occurred behind closed doors, out of ear-shot and oversight of members of the public, and the very dialysis patients DPH purports to serve.

For her part, Health Commission President Sonia Melara said not one word about the issue on February 14, 2012, unless Morewitz elided her oral remarks from the “Commissioner Comments Follow-Up” section of the JCC’s published minutes.  Melara, employed by St. Francis Hospital, may fully understand not wanting to divert lucrative MediCare dialysis patients from private sector providers vying for the fierce competition for dialysis revenue.  She also holds an appointment as the Health Commission’s representative on the Board of Directors of the San Francisco Public Health Foundation, which also may be eager to preserve lucrative business for private-sector hospitals.

Fast forward to the SFGH JCC’s meeting on April 10, 2012.  Once again, SFGH CEO Sue Currin presented a PowerPoint presentation to the JCC about outsourcing SFGH’s Renal Center.  The April 10 minutes also report in the Commissioner Comments/Follow-Up section show that Commissioner Chow asked for “clarification on the reason for the timing of the review” of the [outsourcing] issue.”  Chow asked if DPH and SFGH had spoken “with UCSF about the Mt. Zion option or about the RFP [to outsource to LHH].”  Cathryn Thurow, a UCSF Assistant Dean reported there had been no direct conversation with Mt. Zion, but indicated another UCSF Associate Dean — Dr. Sue Carlise —  had spoken to UCSF administration and had “heard favorable feedback about it [UCSF] applying for the [LHH dialysis] RFP.”

Commissioner Sanchez again stated he was “very interested” [apparently as a UCSF employee himself], in “SFGH/DPH pursuing dialogue with the UCSF leadership,” about any potential for UCSF “to combine renovations of the SFGH and Mt. Zion outpatient renal centers into one project to alleviate the need to move the unit out of SFGH.”  A week later, on April 17, in a summary report of JCC Committee reports to the full Health Commission, Sanchez commented that the goal is to find a safe facility to provide dialysis services, and that he “would like the SFGH campus to be part of a solution in regards to final plans for DPH’s outpatient renal services.”

Once again, minutes of the April 10 SFGH-JCC meeting and the April 17 full Health Commission meeting report not one peep out of Ms. Melara or Ms. Garcia. Sanchez must surely know that LHH is really not a “safe” facility.

Given the Health Commission’s and DPH’s indecision about where to place outpatient dialysis services to serve SFGH patients, the most obvious solution the City studiously ignored is right under their noses, suggested by UCSF employees staffing the Renal Center at SFGH:  Delaying the RFP and moving the dialysis center into SFGH’s current Acute Hospital in Building 5 in which approximately 140,000 square feet of space will become vacant, and available (turf desperately being fought over), when SFGH’s new hospital under construction and nearing completion vacates Building 5, which is far more seismically safe than either the Renal Center’s current location in Building 100, or LHH’s almost-as-ancient seismically-unsafe buildings, as the Westside Observer noted in the September issue, and certainly much larger than the 8,500 square-foot space being proposed for dialysis at LHH.  SFGH is where the Renal Center should be located, in order to provide the most seismically-safe, life-safety location, since LHH isn’t.

Renal Center staff suggested that since SFGH plans to move its Rheumatology, Dermatology, and other “clinics,” into the vacated space in Building 5, the logical choice would be to find room in Building 5 to move the Renal Center into, too, given the many co-morbidities facing dialysis patients who would benefit by not fragmenting locations of care.

Commissioner Chow, having asked Garcia and SFGH to consider “all options,” never commented on an option to move the Renal Center to Building 5.  Indeed, the Health Commission appears never to have discussed in public meetings, that Building 5 might well be the best location.

For his part, Commissioner Chow was reported in the SFGH-JCC’s February 14, 2012 meeting minutes as having requested that DPH explore not only all “possible options,” but that DPH postpone release of the RFP to move dialysis services to LHH until Director of Public Health Garcia reported back to the SFGH JCC regarding this issue.

For her part, Director of Public Health Garcia is not mentioned in public records as having presented a report-back to the Health Commission regarding all options considered before release of the RFP, including an option to move the Renal Center to Building 5.  There’s no public records, apparently, that Garcia ever “reported back” before the RFP was issued. 

As if the Health Commission didn’t observe that Garcia had gone missing in action, or AWOL, providing the requested report-back.

Perhaps Garcia presented a report-back in a closed-door session of the Health Commission, or by e-mail to Health Commissioners.  But dialysis patients, patient advocates and caregivers, and members of the public never heard in public meetings, any or all options the Health Commission requested be explored, or that Garcia may, or may not, have presented.

All along, the Health Commission, DPH, SFGH, and LHH have played a really bad circle game, delaying for long over a decade, decisions on how to provide life-saving dialysis services to San Francisco’s most vulnerable patients.

The “Life Safety” Canard

Over a decade ago, then Dr. Talmadge King, who oversaw medical services at SFGH, was quoted in the San Francisco Bay Guardian (“Kidney punch,” October 6, 2002) that “There aren’t enough dialysis spots in San Francisco, and we’re very worried about that.”

Considering the glacial speed of rebuilding the Bay Bridge following the Loma Prieta earthquake, and the endless delay of building a safety barrier on the Golden Gate Bridge, a decade-long delay in planning for caring for increasing numbers of MediCal-reliant dialysis patients in San Francisco is not be too surprising and was almost predictable.

The claim is that SFGH’s Building 100 is not life-safety compliant due to lack of sprinklers, fire alarm speakers, and smoke alarms, and may have an open stairwell in the building that doesn’t have a fire-wall door.  Ms. Currin’s April 2012 PowerPoint presentation to the Health Commission noted getting the fire safety deficiencies, sprinklers, and alarms up to Life Safety code would cost a mere $636,000, and other improvements another $331,000, for a total of less than one million dollars.  Add to that another $5.5 million to correct the elevator’s ADA access deficiencies — which SFGH has long delayed bringing into ADA compliance and should have been upgraded by now, and which expense it will eventually have to bend over and cough up — for a total of just $6.5 million.  This is chump change, which DPH surely has.  SFGH’s Renal Center could stay right where it is, and prevent the fragmentation of dialysis patient’s care.  It is thought that the increased costs of transportation could have easily funded the first million to correct Life Safety code deficiencies in Building 100.

But the area proposed for dialysis at LHH also reportedly has an open stairwell — admittedly at the opposite end of the third floor hallway — that also does not have a fire-wall door.  And a former staircase immediately adjacent on the right to the entrance area where the LHH dialysis center will be housed, has been removed during reconstruction, limiting egress from the building to a central staircase a good 100 to 200 feet away, at minimum, from the proposed dialysis space, and the open stairwell further down the hallway.

As with the debate of getting CPMC patients out of a third-floor location, getting dialysis patients in wheelchairs, on gurneys, and using other assistive devices down two flights of stairs at LHH during an emergency hasn’t been discussed openly, least of all by the Health Commission.  The best life-safety location appears to be in Building 5 — SFGH’s current main hospital — that the Health Commission seems to have forgotten even exists as the best, obvious option, since it is far more seismically safe than either SFGH’s Building 100 or in LHH’s old buildings.

The Other Canards Circle

In addition to patient advocacy concerns about the wisdom of increasing transportation burdens on vulnerable dialysis patients by shunting them to LHH, there are other canards involved.

First, DPH claims insufficient space at SFGH to meet the growing demand of Safety Net patients.  DPH ignores the 140,000 square feet of space that will become available in Building 5 in which to “grow” Renal Center space in a centralized care location on the same campus where it has operated for 46 years.

Second, although DPH claims the Renal Center will grow from 13 to 30 chairs by moving it to LHH, dialysis staff have questioned this assumption, since in order to be profitable, the contractor awarded the RFP to operate at LHH will more than likely limit the number of chairs it will contract to DPH to probably 15 chairs, reserving the rest for privately-insured patients in order to develop a payer mix to meet revenue projections and remain profitable.  It’s unlikely the 13 current “chairs” will grow by much if the vendor chosen restricts the number of chairs contracted for DPH clients to 15.

Given current trends, the dialysis patient population is expected to grow significantly, and San Francisco will need more and more dialysis chairs to served MediCal patients, not less.

Third, DPH’s April 10 PowerPoint presentation to the Health Commission indicated that the “current plan is to issue [an] RFP for either a private or non-profit provider.”  Health Commissioners Chow and Sanchez stated several times they expected a contract would go to a non-profit provider.  Elsewhere, patient advocates were assured the RFP was being developed to award the contract to a non-profit provider, but that restriction wasn’t in the RFP eventually issued.  According to a DPH contracting officer on September 25, the only three companies to submit a letter of intent by the August 26 deadline making them eligible to bid on the RFP were from Dialysis Clinic Incorporated (DCI); Satellite Healthcare, Inc.; and DaVita HealthCare Partners, Inc.  Only the first two are non-profits; DaVita is a for-profit company.  In 2012, there were reports that two for-profit dialysis chains in San Francisco have pending legal actions against them for submitting false billing claims, over-using anemia drugs, and for using dialysis machines associated with infection and death.

CPMC’s Dialysis Center is now outsourced to Da Vita, which by report has denied patients oxygen, substituting re-circulated air because it’s free.

Fourth, of great concern, the RFP restricts the hours of operation for dialysis at LHH to Monday through Friday from 6:00 a.m. to 6:00 p.m., and will exclude holidays “generally recognized by the City.”  But SFGH’s Renal Center currently operates from 5:30 a.m. to 8:00 p.m. Monday’s, Wednesday’s, and Fridays, and is open from 5:00 a.m. to 6:00 p.m. on Tuesday’s, Thursday’s and Saturday’s.  In effect, the RFP’s restrictions will eliminate at least 26.5 hours of dialysis treatments weekly by curtailing the hours of operation.

Another potential problem may involve water.  Hemodialysis requires a lot of water, and water treatment.  There are unavoidable leakages, with water flowing down hill into areas below any dialysis unit not located on a ground floor.  This may be a problem at LHH, if there is water leakage from a third floor dialysis unit down to Moran Hall on the second floor, or Gerald Simon Auditorium and the Chapel on the first floor.  After the $600,000 mold problem that resulted from water leakage in LHH’s new Pavilion Building that the Observer reported in our July issue (Of Mold and Men), you’d think LHH would be more cautious about projects with potential water leaks.

Some observers note that violence in dialysis centers is on the rise, and are worried that the RFP says the City will provide building security only at levels currently provided.  Other concerns are whether the vendor awarded the contract will have to pay additional rental under the lease if they decide Saturday hours will be needed to meet increases in demand for dialysis services.  The RFP also stipulates that electrical usage in excess of the operating hours will also have to be reimbursed by the tenant for any electrical consumption overage.

DPH claims that operating the Renal Center at SFGH results in a mere $9,063 annual revenue loss, mostly from the $20,000 monthly it spends on out-of-network costs for SF Health Plan patients unable to be accommodated in its current location who are referred to external providers.  DPH also claims revenue to the vendor awarded the contract to outsource dialysis may potentially earn $1.25 million annually operating a 30-chair dialysis unit at LHH.  SFGH Renal Center staff who have testified before the Health Commission have noted that outpatient dialysis is a revenue generator for SFGH, and outsourcing it will result in the loss of millions of dollars in revenue for SFGH and DPH.

Some observers believe UCSF and SFGH and DPH are simply fudging their facts.

As with the dumping-of-the-elderly problems reported in “Who’s Dumping Grandma?” in the Observer’s June issue, and the dumping-of-mental-health-patients problems reported in “Squished Together: Misery Visits Company” in the Observer’s September issue, it now appears that DPH is dumping dialysis patients over to LHH principally to increase DPH’s revenue under implementation of Obamacare, by swapping out dialysis revenue for the much more stable revenue it will generate by renting out floor space at LHH to an outsourced vendor, dialysis patient’s outcomes be damned. 

Welcome to the circle game, which may be a close second-cousin-twice-removed relative of the circle jerk phenomena at the 2012 Democratic National Convention in Charlotte, North Carolina described by the New York Times Magazine’s chief national correspondent, Mark Leibovich, in his new book “This Town” on the New York Times’ current best-seller list.

The No Public Hearings Circle

One remaining question is whether Supervisors David Campos and John Avalos will step up to the plate to have the RFP cancelled, reconsidered, and potentially put out for re-bid, if space cannot be located in Building 5 at SFGH.  After all, that vacated space will open up just about the same time that a dialysis center at LHH would open up.  The two Supervisors should schedule a hearing to discuss the pros and cons of moving dialysis services to LHH, adversely affecting health outcomes for their constituents.

The two members of the Board of Supervisors successfully forced Mayor Ed Lee into re-negotiating with CPMC to build its Cathedral Hill Hospital on Van Ness Avenue by forcing CPMC to also rebuild St. Luke’s Hospital in the Mission to prevent the loss of vital, accessible healthcare services to particularly vulnerable East Side residents. 

The question now is whether Avalos and Campos might step in to prevent the loss of services to patients in the Mission, Bernal Heights, Excelsior, and the Bay View Hunters Point neighborhoods, among others, who would face having their dialysis care outsourced and fragmented to LHH, where the circle-game may come full circle.

After all, if the Health Commission’s Executive Secretary Mark Morewitz is correct — which he is probably not — that the SFGH Renal Center has been “outsourced” to UCSF, a private hospital, despite SFGH actually holding the license for operating it using UCSF staff under is ‘affiliation agreement,’ then the Health Commission should have already conducted what is known as a “Prop. Q” hearing to determine whether a private-sector hospital’s abandonment of services will have an adverse, negative effect on the health of San Franciscans.  Such a hearing requires a vote by the full Health Commission for private hospitals.

Alternatively, if SFGH decides to reduce the availability of on-site outpatient dialysis services, the County Board of Supervisors are required to hold what is known as a “Bielenson hearing,” which State law requires whenever healthcare services will be reduced at a given County location, or when the transfer of management of a County-operated healthcare facility is being considered, notice must be posted on the entrance doors of the affected facilities, and County supervisors are required to hold a public hearing.

Neither a Prop. Q hearing, nor a Bielenson hearing, have been held to date.  One or the other — or both must apply. 

It’s time for Supervisors Avalos and Campos, and other Supervisors, including District 7 Supervisor Norman Yee, to interrupt this circle game void.

 

Monette-Shaw is an open-government accountability advocate, a patient advocate, and a member of California’s First Amendment Coalition.  Feedback:  monette-shaw@westsideobserver.com.

October 2013

Laguna Honda Hospital and SFGH

Squished Together: Misery Visits Company

Given San Francisco Department of Public Health's stated budget goal of maximizing revenue in anticipation of implementation of Obamacare, it's probably not too surprising the department decided to squish patients out of its Mental Health Rehabilitation Facility at SFGH, squish them into Laguna Honda Hospital or out-of-county, squish non-ambulatory elderly two-to-a-room into the spaces converted into housing at the MHRF, and squish outpatient dialysis services into Laguna Honda's decrepit old buildings.

Then came the shocker. After all the squishing, Mayor Ed Lee rewarded the Health Department a budget increase of $200 million, pushing the department to an almost $2 billion-a-year budget.

Despite the Supervisors being told by Director of Public Health Barbara Garcia that the 34 patients in the MHRF would be relocated to Laguna Honda Hospital or 'placed in the community,' it turns out this reporter's concerns that patients would be dumped out of county has, in fact, occurred. The Supervisors never asked what 'in the community' meant, so DPH had the green light to dump patients out-of-county, albeit at the City's expense.”

MHRF Reconfiguration Dumped Patients Out-of-County

As reported in "Of Mold and Men" in the Westside Observer's July issue, the Department of Public Health's proposal to repurpose its Mental Health Rehabilitation Facility/Behavioral Health Center into mere housing was ostensibly approved by the Board of Supervisors during its June 18 Bielenson hearing in Board chambers. The Board didn't actually vote to accept or reject the Bielenson cuts proposed by DPH, it just closed the hearing, noting in its meeting minutes "No further action was taken."

Despite the Supervisors being told by Director of Public Health Barbara Garcia that the 34 patients in the MHRF would be relocated to Laguna Honda Hospital or "placed in the community," it turns out this reporter's concerns that patients would be dumped out of county has, in fact, occurred. The Supervisors never asked what "in the community" meant, so DPH had the green light to dump patients out-of-county, albeit at the City's expense, perhaps to the chagrin of City Attorney Dennis Herrera who is considering suing Nevada for inappropriate patient dumping into San Francisco, but who doesn't appear concerned about The City's own outbound patient dumping.

According to one reliable source who spoke on condition of anonymity, at least one of the MHRF's patients was admitted to a hospice, and 12 were admitted to LHH. Reportedly, the rest (of 36, not 34) "are being housed out of county at the City's expense." A second source independently verified that 12 of the MHRF's patients have been transferred to Laguna Honda. The rest have reportedly either gone to other care facilities like Crestwood Hope and Idlywood, or to non-profits like Loso House (a transitional program for people with serious mental health and substance abuse problems) operated by the Progress Foundation, which holds lucrative City contracts.

About half a dozen of the MHRF's patients reportedly went AWOL (absent without leave) while out on passes, perhaps to avoid being squished into Laguna Honda Hospital, or squished out — dumped out-of-county. Did they join San Francisco's mentally-ill homeless?

Another observer worries about the Health Department's claim that patients would be transferred from the MHRF to other "less-restrictive" settings. Given it's licensure, LHH is not a less-restrictive setting, since it's licensed as a "distinct-part" skilled nursing facility attached to a hospital. This issue is of keen interest to the U.S. Department of Justice's Civil Rights Division, which forced Laguna Honda through a legal settlement into discharging its patients to less-restrictive settings.

Dial "M" for Mayoral Veracity

There may have been no point dialing "M" hoping to obtain the mayor's veracity about whether or not he did restore all of the mental health cuts Director Garcia lured the Board of Supervisors into believing had happened. But here's how dialing "M" for Mayor Lee's public records went down.

When Supervisors London Breed and Malia Cohen pushed for information from DPH's Director Garcia during the Bielenson hearing in June, they may have been hoodwinked by Garcia's claim that the Mayor had restored "all" mental health cuts to his proposed two-year City budget for FY '13-'14 and FY '14-'15.

Following the Board of Supervisors Bielenson hearing on June 18, this reporter placed a public records request the next day addressed to Director Garcia — with courtesy copies of the records request sent to the Health Commission and DPH's public information officer, as well as to all 11 members of the Board — requesting a list of all of the mental health services restored by the Mayor.

This reporter received return receipts from Garcia's public information officer Eileen Shields, the Health Commission's Executive Secretary Mark Morewitz, four of the Board of Supervisors — including Supervisors David Campos, Mark Farrell, Scott Wiener, and Eric Mar, but not Supervisors Malia Cohen or London Breed — and from the Clerk of the Board, presumably Angela Calvillo. A return receipt was also received from Health Director Garcia. Eight people had opened and apparently read the records request. But the three principles — Garcia, Morewitz, and Shields — never bothered responding to the records request at all, which in and of itself is a violation of San Francisco's Sunshine ordinance. Never heard a peep out of any of them for a list of the mental health services restored by the Mayor. So much for veracity.

So this reporter tried again, placing a second immediate-disclosure records request on July 6 to the Mayor's >Budget Director Kate Howard and Lee's spokesperson, Christine Flavey, asking for a list of each and all mental health services restored by Mayor Ed Lee, sending electronic courtesy copies to Supervisors Breed and Cohen. Once again, this reporter received return e-mail receipts indicating that Ms. Howard, Ms. Falvey, and Supervisor Breed — but not Supervisor Cohen — had opened and ostensibly read the second records request.

Ten days later on July 16 — again in violation of the Sunshine Ordinance's immediacy-of-response provisions — this reporter finally heard back, not from the Mayor's Budget Director, but from Kirsten Macaulay in the Mayor's Office of Communications, that the Mayor's office had "no responsive records" to my request. Macaulay directed me to (of all places) the Department of Public Health, which hadn't previously responded, and which hadn't created a list of whatever it was that the Mayor had reportedly restored.

On August 3, this tenacious reporter tried again, sending a third records request to Deputy City Controller Monique Zmuda asking for any records that the Controller's Office may have showing which mental health services the Mayor restored prior to the June 17 Bielenson hearing between his proposed budget submission in May and his final budget submission in June.

Six days later, Zmuda indicated on August 9 that she had spoken with Ms. Howard, who assured her that Howard's office doesn't maintain records "on programs not reduced or added back by the Mayor, only of services reduced." Does anyone really believe that the Mayor's Office of Communications or his Budget Director doesn't track programs added back by the Mayor in order to crank out media publicity about his accomplishments?

Nonetheless, Zmuda indicated she would have her budget staff "run some reports that show [the Mayor's] submitted budget and [the] Mayor's approved budget and we should have those next week." She indicated any such Controller's Office report would contain only dollar amounts, not program descriptions affected. Zmuda indicated DPH's Bielenson list would provide information on the original cut list, and that her office "may be able to annotate this with the health dept's staffs' help."

Also on August 9, one of the Controller's employees responded separately, saying the records request was a more "extensive and demanding request," and that the Controller may need to consult with another City agency, invoking an extension permitted by San Francisco Sunshine Ordinance.

When this reporter then e-mailed Zmuda the next day on August 10 noting that if Controller's Office was invoking an extension, it should be dated to start on Monday, August 5 (the first business day after first filing the request on Saturday, August 3), not on August 9, the next response from Zmuda was when she clammed up on August 10, saying that "We [the Controller's Office] have no documents that are responsive to your request."

Another door slammed shut. So much for City Hall's claims that it will openly provide data concerning City government on its new "open data" web site.

Squishing Replacement Patients Into the MHRF

When the MHRF beds on its second floor officially closed on Thursday, August 15, DPH's plan was to turn it into a Residential Care Facility for the Elderly (RCFE), and cram 59 indigent, non-ambulatory seniors two to a room, in the roughly 10-foot by16-foot rooms. There, they will face living together squished into "housing" not much larger than a prison cell, with no in-house services or "therapeutic" activities. How non-ambulatory elderly residents will care for themselves without in-house services or activities has not been explained.

But they'll be on an unlocked floor upstairs from an Adult Residential Facility (ARF) on the first floor that is also unlocked, which houses residents who have basically been banned from regular board-and-care facilities due to their behavioral issues. The first and second floor residents will share the nearest Muni bus stop with patients of a methadone program that is also located on SFGH's campus, which may be bad news for future residents. Some worry about what might possibly go wrong.

Soon, the City will lose a total of about 72 long-term mental health beds at the MHRF once its third floor turns half of its beds into respite beds. All in all, most observers believe that the "re-purposing" of the $40 million MHRF into essentially "housing" that has occurred since 2003 is scandalous. But a compliant Board of Supervisors has quietly gone along with the MHRF's reconfiguration, fully cognizant of the loss of long-term mental health beds at public- and private-sector hospitals throughout San Francisco.

More Squishing: Dial "D" for Dialysis

After Katie Worth published her article "Dialysis shortage creates expensive problem for
city," in the San Francisco Examiner on July 20, 2010, this reporter wrote two stories on July 22, 2010, and August 4, 2010 about the crisis with dialysis services at SFGH and Laguna Honda Hospital, while then the "San Francisco Hospital Examiner" for the Examiner's
on-line web site (paid just mere pennies based on web page "hits"). My reporting noted three years ago that LHH and SFGH had both failed to include space for dialysis patients in both of their rebuild projects.

Dialysis is a blood-filtration technique used on patients with kidney failure. Ms. Worth noted fully three years ago that dialysis centers in the City "increasingly exceed capacity, requiring some patients to be hospitalized for days or weeks — often on the public dime — while they wait for a spot at an outpatient clinic to receive the life-saving treatment. When patients need dialysis but there's no room in the outpatient center, they can end up being hospitalized. Hospitalizing a patient for dialysis can cost taxpayers thousands of dollars a day, whereas receiving the three-hour blood-cleansing treatment costs just hundreds of dollars, according to hospital officials."

Out of the blue on August 12, and now fully three years later, DPH just got around to issuing a Request for Proposals (RFP) seeking to outsource, build out, and squish a 30-chair outpatient dialysis center into Laguna Honda Hospital to serve all of DPH's dialysis patients. It will take another 16 months before any successful bidder on the RFP will actually open dialysis services at LHH, nearly five years after the Health Commission faced Worth's scathing reporting in the Examiner.

Prior to the release of the RFP, it is thought there were no public meetings, and no public dialogue, about whether LHH is even the right location at which to place dialysis services. Why weren't there any public meetings and public dialogue? Oh! I forgot: DPH doesn't believe there's any need for it to consult publicly with the community about LHH.

Potential bidders will have until October 21 to submit proposals, top vendors will be chosen on December 2, and the Health Commission and Board of Supervisors are tentatively scheduled to approve issuing a contract in January 2014. The "start date" of the 10-year dialysis contract award is expected for March 2014, with the build-out and opening of the dialysis center by the end of December 2014.

A number of concerns about placing outpatient dialysis services at LHH will be explored in the Westside Observer's October issue. For now, San Franciscans may want to question the wisdom of moving dialysis services from SFGH's Building 100 (an admittedly unsafe building), to an area in Laguna Honda that may also be seismically unsafe.

One knowledgeable source with an amazing memory recalls there was never a plan to seismically retrofit portions of LHH's old main building where the proposed outpatient dialysis center at LHH will be placed. Officials knew that seismically bracing the old administrative wings was way too costly and there would be too much lost floor space. And LHH wanted out of further Office of Statewide Health Planning and Development (OSHPD) oversight and control.

A second knowledgeable and high-level source confirmed that the LHH's replacement remodel plans had never intended to "bring the old buildings into seismic compliance, but rather mitigate some known vulnerabilities, such as removal of hollow, clay-tile walls and replace them with new concrete walls, and generally improve the life safety quotient for occupants of the old buildings."

That's it? Just mitigate? Replacing an unknown number of hollow-clay walls with some concrete walls? How many isn't known, since Laguna Honda referred this reporter to the Department or Public Works, who then suggested that OSHPD might not let drawings and specifications be released.

For all of DPH's squishing, Mayor Lee rewarded it a budget increase of $200 million, pushing DPH's budget to approximately $1.9 billion, reported in the Health Commission's August 6, 2013 meeting minutes.

When you're sitting in a dialysis chair at LHH due to kidney failure when the next Big One hits, will your relatives be notified you've been squished in a seismically-unsafe building?

Or will the City simply assert it has no statistics, deny negligence, and claim misery was just visiting company?

 

Monette-Shaw is an open-government accountability advocate, a patient advocate, and a member of California's First Amendment Coalition. Feedback: monette-shaw@westsideobserver.com

September 2013

Laguna Honda Hospital Patient Dumping – Part 2

Of Mold and Men

Between dumping mental health patients into Laguna Honda Hospital and out-of-county, and dumping elderly skilled nursing patients out-of-county to make room for mental health patient admissions, who knew that news of mold in the LHH's new kitchen would be overshadowed by the sudden resignation of LHH's public information officer, Marc Slavin?

And that Slavin's ouster would obscure news that Mayor Ed Lee would be joined by a compliant Board of Supervisors reaching consensus to shut down San Francisco's Mental Health Rehabilitation Facility during budget negotiations?

Laguna Honda had never needed — and never had for over 100 years — a P.R. department in a public hospital serving what is essentially a "captive audience" of the medically indigent who have nowhere else to go."

Minister of Misinformation?

If I were a San Francisco Health Commissioner, I'd be furious that LHH's CEO Mivic Hirose appears not to have notified the Health Commission before Friday, June 21 that Marc Slavin, Laguna Honda Hospital's public information officer and communications director, had suddenly resigned days before, since news of his pending resignation was being openly discussed at LHH for at least two weeks, and line staff knew Slavin was physically gone the day before his resignation announcement was made. This is news that clearly should have been shared with the Health Commission to prevent them from being caught off guard.Marc Slavin

Slavin, you may remember, creatively spun to I-Team investigative journalist Dan Noyes in May 2010 that "the LHH patient gift fund isn't for patients" when Noyes first broadcast news that LHH's administrators had inappropriately been spending hundreds of thousands of dollars of donations to the patient gift fund on staff, instead.

For six years many believe, Slavin essentially served as LHH's shadow CEO, propping up Hirose when not running the entire show, including reports that he intermittently inserted himself into clinical-care decisions regarding specific patients with no medical license to do so, as well as interviewing job applicants and hiring decisions throughout the hospital.

Although staff and patients often wondered what Slavin's job duties involved, he served alternatively as Hirose's ghost-writer, speech writer, spokesperson, and staff bouncer. There are reliable reports that the intense friction between Slavin and Hirose had recently escalated. One high-level source has confirmed that Hirose and Slavin weren't getting along anymore, and during recent public meetings Slavin sat in seating for members of the public, not at the main table, sending a signal that he was on the outs with Hirose.

Previously, Slavin appeared untouchable, due to his benefactress former City Attorney Louise Renne, and former Director of Public Health Mitch Katz. As a 1375 Special Assistant XVI , a job code typically reserved for the Office of the Mayor and Board of Supervisors, observers suspected Slavin was brought in by then-Mayor Newsom.

But once Katz fled to Los Angles following a whistleblower complaint that Katz had accepted significant consulting fees from a City contractor to whom he had steered lucrative consulting contracts, and after Renne's Laguna Honda Foundation imploded, Slavin lost his political cover.

Slavin claimed to staff in a goodbye note that he was resigning in order to complete his PhD thesis. There was no usual-and-customary "good-bye" party to honor Slavin's six-year service.

Along with Slavin's ouster, there are reports that LHH suddenly and completely disbanded its Communications Department at the end of the week, the very three-person empire Slavin created that at one point was consuming over $300,000 a year in salaries and benefits. Prior to his arrival in mid-summer 2007 on assignment to "stop the negative publicity about LHH" for Louise Renne's Laguna Honda Foundation, Laguna Honda had never needed — and never had for over 100 years — a P.R. department in a public hospital serving what is essentially a "captive audience" of the medically indigent who have nowhere else to go.

Emerging Mold Problem

Freshman District 7 Supervisor Norman Yee attempted to circumvent recommendations by Harvey Rose, the Board's Budget and Legislative Analyst. On June 5, Yee introduced an "emergency" sole-source contract not to exceed $595,367 to repair a cart wash leak that resulted in extensive mold in LHH's new kitchen. The cart wash room is where mobile carts used to transport food from the main kitchen to the patient's rooms are washed.

Although John Thomas, the LHH Replacement Project manager from Department of Public Works (DPW) claimed during the June 5 hearing that there is a "temporary cleaning facility" for the carts used to transport meals to patients, LHH staff asserts that the food carts are now just cleaned using disinfectant wipes, not fully washed.

Mr. Rose recommended that a sole source contract not be issued, there was no "emergency" involved, that the amount be reduced by $266,723 to only $328,644, and that the DPW should seek competitive bids from the lowest-responsive bidder to complete the remaining remediation of the mold in LHH's new kitchen.

Although LHH moved into its new facilities in December 2010, elevator maintenance staff working in LHH's new Pavilion Building didn't discover a water leak in the elevator's machine room until September 2011. The leak had gone undetected and was eventually traced to the hospital's cart wash room on the floor above the elevator machine room, resulting in mold growing in several rooms.

But despite discovery of the mold in September 2011, the Director of DPW didn't declare an "emergency" until June 6, 2012. DPW initially estimated the cost to repair would be up to $250,000, the threshold set in Administrative Code Section 6.60 that permits City department heads to award emergency contracts without undergoing competitive bidding procedures. DPW awarded a not-to-exceed sole-source contract for just $80,000 to Belfor USA Group to perform the demolition, mold remediation, and reconstruction work; Belfor began the remediation in late June 2012.

For his part, Mr. Thomas claimed that the delay involved determining if it would be covered by LHH's insurance policies, or whether the repairs would be funded through recovery of funds via the lawsuit the City has filed against LHH's architects. Thomas further noted that in 2011, the Replacement Project was directed to redesign the cart wash space, since it was "incompatible with its use," and the space had to be redesigned.

In January 2013, Belfor submitted invoices for $328,644 for remediation work completed through November 2012, and Belfor estimated it would cost an additional $266,723 to reconstruct the facilities, for a total not-to-exceed cost of $595,367. This lead to the Resolution Yee introduced in May, four months after the City received Belfor's revised costs to complete the remediation.

But Mr. Rose noted that the emergency was not officially declared until June 2012 and that Belfor estimated the project would be completed in September 2013, fully two years after the emergency leak was first discovered. Rose had to point out to Supervisor Yee and the Budget and Finance Sub-Committee that Administrative Code Section 6.60 defines emergencies as those which demand immediate action for "conditions that involve clear and imminent danger to prevent or mitigate loss of, or damage to, life, health, property or essential public services."

As such, Rose questioned whether the mold problem at LHH met the City's definition of an emergency, and concluded that in his professional judgment it did not. Rose recommended that Yee's Resolution be revised to put the remaining $266,723 in uncompleted work out to competitive bid to seek the lowest-responsive bid to compete the remaining reconstruction.

Yee charged ahead, ignoring Rose's recommendations. Yee had his Resolution calendared for a hearing, proposing to bypass competitive bids by awarding Belfor an amendment to complete the full $595,367 in work. But following astute questioning by Supervisor John Avalos, Mr. Thomas admitted the work was not an emergency; Avalos got Thomas to agree to accept Rose's recommendation to seek competitive bids.

When Harvey Rose speaks, the Board of Supervisors typically listens.

Louise Simpson from the City Attorney's Office advised that San Francisco has sued Stantec, the LHH Replacement Project architect, for "total estimated damages in excess of $45 million," but she provided no explanation as to why that lawsuit — initially reported to recover $70 million has been reduced by $25 million to just $45 million.

Behind Patient Dumping

Since plans for the two-year budget got underway in early 2013, Mayor Ed Lee has been quietly working with the Department of Public Health (DPH) and its Health Commission to "reconfigure" the Mental Health Rehabilitation Facility (MHRF) — renamed the Behavioral Health Center — on SFGH's campus. The MHRF was supposed to be a long-term care facility for the mentally ill to keep them in-county.

DPH submitted a list of "Bielenson" budget cuts that totals between $29.6 million and $39 million, mostly in cuts to mental health services, that the Mayor appears to have incorporated into his budget submission for the upcoming two-year budget cycle.

DPH proposed — and the Mayor appears to have accepted — cutting $12.7 million (43 percent) of the $29.6 million, by "reprogramming" the MHRF into housing and dumping patients into Laguna Honda Hospital; cutting $1 million (3.5 percent) from tuberculosis control programs; cutting $8.8 million (30 percent) from various community-based services, most of which are mental health services, which cuts will grow to $17 million beginning in July 2015; and cutting just $7 million (23.7 percent) from HIV health services. The HIV cuts are the only ones being aggressively backfilled, and will likely not occur.

Because it will effectively eliminate all but 24 of the mental health rehab beds at the MHRF on the campus of San Francisco General Hospital, submitting such a budget proposal harkens back to Governor Ronald Reagan who shut down California's mental health hospitals and ended federal community mental health centers while President. It appears Mayor Ed Lee and the Board of Supervisors may reach consensus to shut down the MHRF.

As reported in "Who's Dumping Grandma?" in last month's Westside Observer, the Board of Supervisors was required to conduct a State-mandated Bielenson hearing on the DPH's proposal to cut the remaining 47 mental health beds in the MHRF down to just 24. The MHRF had opened with 147 mental health beds, but was "reconfigured" to only 47 in 2003. How long before those remaining 24 beds are simply eliminated altogether?

During the Board's Bielenson hearing held on June 18, Director of Public Health Barbara Garcia tried to reassure the Board of Supervisors that only 12 of the mental health patients at the MHRF would be transferred to Laguna Honda. She claimed — falsely it seems — that the remaining 22 MHRF patients would be placed "in the community," but Garcia failed to inform the Board of Supervisors that the plan appears to be to dump them into out-of-county facilities, not "into the community." Managers throughout DPH are aware the plan will most likely use locked psych facilities out-of-county.

At the start of the Bielenson hearing and prior to taking public comment, Garcia repeatedly acknowledged that "in preparation for healthcare reform [ObamaCare] to reduce costs and increase revenue generation, in the coming fiscal year DPH needs to reduce services that are not revenue generating." Most of the $17 million in the proposed cuts to community-based services are because DPH does not generate revenue by providing those services. Later in the hearing, following public testimony, Garcia indicated that "one of the important things we've been looking at this facility [the MHRF/BHC] it's about $19 million [to operate annually] with only about $2 million in revenue."

Garcia testified "We will be closing one of the two skilled nursing facilities on the SFGH campus, and organizing those services to support discharges from SFGH, [which] we believe [will] increase revenue." This means that, by closing skilled nursing beds for psych patients in the MHRF, SFGH will gain vacated space in the MHRF to be converted, essentially, into "housing" to more quickly discharge acute-care patients from General Hospital into. DPH will be able to increase SFGH revenues by being able to more quickly accept paying, revenue-generating new admissions into the acute-care hospital beds, using the MHRF as transitional housing to quickly dump patients out of the City's acute-care hospital and trauma center.

A few senior managers at LHH are claiming to community leaders that only 6, not 12, of the MHRF patients are slated to move to LHH; the senior managers have also acknowledged the remaining MHRF patients will be placed out-of-county, not in "the community," as Garcia may have misinformed the Board of Supervisors.

Supervisors Support Dumping?

Only four of the Board of Supervisors bothered to ask Garcia questions about the Bielenson cuts; the remaining seven Supervisors raised no questions. Supervisors David Campos and Scott Wiener asked only about the $7 million in HIV service cuts, both men knowing that well over half of those cuts had already been backfilled, and all but a handful of those cuts will likely also be backfilled. Neither man asked about the mental health cuts.

Supervisors Malia Cohen and London Breed asked Garcia questions about the mental health cuts and Laguna Honda Hospital. Supervisor Cohen asked about the mental health cuts. Garcia lamely claimed "many of those individuals will be going into community placement," for those who need "locked facilities." San Francisco has few, if any, in-county locked facilities.

Cohen pushed further, asking if "the number of folks who need [skilled nursing facilities] will outnumber the beds that are available at Laguna Honda Hospital." Garcia indicated that, as individuals leave LHH, DPH will transfer people over. But Cohen understood that every bed, formerly housing the elderly who need skilled nursing care, that is converted into beds for mental health patients, there will be one fewer bed for elderly demented patients needing 24/7 skilled nursing care.

Repeatedly, Garcia noted that the Mayor had restored all of the mental health cuts. But the mental health beds at the MHRF/BHC were not restored, and there are $17 million in looming community-based cuts, which haven't even been identified yet, and won't be until an RFP is issued in 2014.

Garcia indicated DPH is following LHH's admissions policy, but she didn't acknowledge that LHH is — by reliable report — internally considering changing the admission criteria to its North Mezzanine patient neighborhood from "dementia" to "cognitive impairment," potentially paving the way for an admissions policy change, which internal conversation Garcia chose not to share with Supervisors.

At the end of the hearing, President Chiu simply moved the agenda to its next item, without taking a vote. State law only requires that a hearing by County supervisors be held, they are not required to vote on proposed cuts.

Is cutting mental health services in San Francisco to the tune of over $100 million across the past decade really a San Francisco "value"?

Who will be responsible for the death of in-county mental health beds at San Francisco's MHRF, all in the name of increasing revenue?

Monette-Shaw is an open-government accountability advocate, a patient advocate, and a member of California's First Amendment Coalition. Feedback: monette-shaw@westsideobserver.com

July-August 2013

Who’s Dumping Grandma?

The Shame of Laguna Honda

Plans at the Department of Public Health are, apparently, to place 34 of its “behavioral health” patients into Laguna Honda Hospital (LHH), possibly placing more psychotic patients into the mix with the frail elderly and disabled. History repeats itself with the proposed reconfiguration yet again.

On April 20, San Francisco City Attorney Dennis Herrera launched an investigation into whether Nevada’s primary state psychiatric center, Rawson-Neal Psychiatric Hospital, had engaged in patient “dumping” by sending patients out of state using one-way bus tickets. A San Francisco Chronicle article on April 21 quoted Herrera as saying that the practice of psychiatric patient dumping is “shockingly inhumane and illegal.”

 

She (Therapist Blaustein) and the physician assigned to the North Mezzanine raised concerns and protested placement of inappropriate patients, indicating the two patient populations don’t thrive well together because the behaviors of people with dementia agitate psychotic people, and then psychotic patients want to harm the demented ones.”

Herrera’s concern appears limited to in-bound patient dumping and the increased costs to San Francisco for caring for psychiatric patients. But Herrera has been strangely silent regarding out-bound patient dumping from San Francisco to other jurisdictions, and potential patient dumping between San Francisco facilities. His hypocrisy is breathtaking.

This is the same hapless Herrera featured in the article “High Costs of City Attorney’s Advice” in last month’s Westside Observer.

The Chronicle article also reported that Paul Boden, the director of a nonprofit that highlights civil rights abuses against the homeless, the Western Regional Advocacy Project, said “it’s a little hypocritical of San Francisco officials to feign shock at the Las Vegas hospital’s [patient dumping] practice when [San Francisco officials] too, hand out one-way bus tickets to homeless people.”

The Department of Public Health (DPH) is proposing to re-configure the Mental Health Rehabilitation Facility (MHRF) on the San Francisco General Hospital campus, renamed the Behavioral Health Center (BHC) in order to be politically correct, into a residential care and respite care facility, and transferring 34 behavioral health patients to Laguna Honda Hospital (LHH)

Is transferring behavioral health patients to LHH a form of patient dumping into a setting where they may not receive the appropriate level of mental health care?

Battery Against LHH Staff

Alerted this April that LHH had accepted transfer of about 11 BHC patients during 2012, and that an Institutional Police Officer had informed SEIU members at LHH in October 2012 that assault cases at the facility had drastically increased, many were concerned. When it was learned that a food service worker was assaulted on the job in May 2012, subsequently required shoulder surgery following the battery, and has yet to return to work 10 months after being attacked, concern mounted. The worker was so badly beaten that emergency room staff treating her were shocked by her injuries, and the obvious emotional trauma.

She entered a locked dementia unit at LHH — the North Mezzanine, which serves patients at risk of wandering, elopement, or harm — she was assaulted when she encountered a patient who was supposed to be being watched by a “sitter.” The North Mezzanine unit has traditionally housed and cared for demented, but ambulatory, patients, it is a locked unit implemented to protect patient safety.

But LHH placed behavioral health care patients on the North Mezzanine, possibly agitating demented patients. The patient who assaulted her was finally sent on a “5150” psychiatric hold to SFGH after going on another rampage. A separate patient who had been discharged was eventually readmitted to LHH, despite being a sexual predator.

An investigation revealed that the injured staff member is now suing the City, possibly alleging negligence and mishandling of the situation following her assault and battery. The lawsuit appears to be sealed, most likely to protect patient privacy, even though the patient has reportedly since died. As a reminder, assault is any reasonable threat of physical harm to another person; battery is actual physical contact and actual harm.

Staff Retraining Required

Her battery case may not be the only one, but her assault was a big deal in LHH. Multiple meetings were held to calm staff, and hospital administration spent a lot of money to have all employees go through SMART training — staff training presented by a licensed Psychiatric Technician on how to remain safe around violent patients.

SMART training is definitely not part of the training typically provided to staff in long-term care skilled nursing facilities; it is more typically presented to staff working in psychiatric and mental health settings. The SMART training at LHH was introduced in 2005 to deal with its then-new patient population during the ruckus over implementing the “psycho-social rehabilitation” model of care exported to LHH when Mozietta Henley, RN, PhD was shunted from the MHRF to LHH, toting along her “BioPsychoSocialSpirtual (BPSS)” model of care proposal that was never tested or implemented at the MHRF.

Henley’s model of care comically became the basis for a small California HealthCare Foundation grant LHH’s Mivic Hirose was awarded for “Social Rehabilitation.” [I was there: Hirose’s January 2005 grant ended as a notorious flop, probably an embarrassment to the California HealthCare Foundation, and created a ruckus at City Hall.]

This followed on the heels of former Director of Public Health Mitch Katz’s nervous announcement on October 20, 2004 during LHH’s Executive Committee meeting of his “vision” that LHH would become a “social rehabilitation facility for the homeless poor,” a statement the City soon denied had been made, but the cat was out of the bag since numerous LHH staff had heard Katz speak clearly. Previously, the not-too-esteemed Dr. Katz lured the MHRF Blue Ribbon Committee into believing that the “future LHH” would provide “the same kind of services as offered at the MHRF.” If the City accepts DPH’s proposal to reconfigure the MHRF and dump more psych patients into LHH, we’ll have come full circle to Katz’s prediction of offering MHRF services at LHH.

Uptick in Sheriff’s Statistics

Alerted that an uptick in assaults at LHH may have occurred between calendar years 2011 and 2012, Sunshine records requests were made to the SF Sheriff’s Department, knowing that asking LHH’s administrators for this data would meet with dead silence, if not endless delays and denials.

Data provided by the Sheriff’s Department on May 21 shows that between 2011 and 2012, battery incidents increased at LHH by 18.2%, from 22 to 26 such cases, which is statistically significant. Across the same time period, “disturbances by resident” incidents summarized on the monthly Sheriff’s Activity Reports increased 227.8%, from 115 to 337 at LHH, and “disturbances by visitors” increased 309.4%, from 32 to 131 cases.

It’s no wonder that in October 2012 an Institutional Police officer from the Sheriff’s Department advised SEIU members working at LHH that assault cases had drastically increased.

Three Questions Lead to Bullying

Laguna Honda staff brave enough to ask questions are frequently targeted for retaliation. Indeed, the culture of staff intimidation was increased soon after Hirose was appointed CEO in 2009, and after Slavin came on board in 2007 to “stop the negative news about Laguna Honda” for his benefactress, former City Attorney Louise Renne. The intimidation was designed to silence and weed out any remaining staff who dared to question agendas that violated State laws and existing hospital policies.

Randy Ellen Blaustein, a therapeutic recreation therapist on the North Mezzanine unit who worked at LHH for eight years, raised three questions about the mixing of ambulatory demented patients with patients having psychiatric diagnoses from the BHC transferred to the North Mezzanine. She and the physician assigned to the North Mezzanine raised concerns and protested placement of inappropriate patients, indicating the two patient populations don’t thrive well together because the behaviors of people with dementia agitate psychotic people, and then psychotic patients want to harm the demented ones.

Blaustein noted the North Mezzanine physician had complained to hospital administration about no longer being able to provide input to admission decisions to their unit, and protested inappropriate placements, but was ignored.

During a key meeting with hospital administration, Randy apparently asked three questions that landed her in a lot of trouble:

1) Why hadn’t LHH’s Administration honored its vow not to place residents with histories of physical aggression and violent behaviors on the North Mezzanine?

2) Why did the unit no longer have input into admission processes? and

3) Why wasn’t their unit granted a lower census, since they had been afforded that in the old facility, given their patient population?

Apparently, someone reported to her supervisor, Bill Frazier the Director of the Activity Therapy Department, that Randy had “overstepped boundaries; was negative and didn’t offer solutions; wasn’t supportive of the new LHH; and (gasp!), had insinuated that Administration didn’t know what they were doing.” Instead of supporting Blaustein, Frazier asked her to cease asking contentious questions in meetings. Randy says she had previously gotten into trouble for upsetting Dr. Colleen Riley, LHH’s Medical Director, in another meeting.

“With severe dementia, less is more. I’ve never heard of any other facility that places nearly 60 ambulatory people with severe dementia in the same living area, with psychotic people in the mix,” Blaustein says. “The North Mezzanine received new admissions that required 1:1 ‘sitters’ at all times, because of their physically aggressive behaviors, placing other residents and staff at risk.”

After Clarendon Hall closed, LHH never re-created the three locked psych units that had been on the second floor of Clarendon. Many of LHH’s staff, including Blaustein, believe that’s, in part, why the new LHH is such a mess.

Another source reports that the staff member who was assaulted, subsequently requiring shoulder surgery, who is now suing, was assaulted by the North Mezzanine patient who was supposed to have a 1:1 sitter, but somehow got out of the inner door to the unit and attacked her before the outer door. So much for sitters.

Randy says that, after being repeatedly bullied, she chose to resign. Shortly before she left in mid-December 2012, a discussion began to consider changing the admission criteria to the North Mezzanine from “dementia” to using “cognitive impairment,” but she doesn’t know the outcome of that discussion. Like many former employees, Blaustein still cares deeply about LHH’s residents and staff, and their safety.

Earning His Comeuppance

Bill Frazier appears to be his own worst enemy. Comeuppance was bound to catch up with him, since what goes ’round, typically comes back ’round. All staff at LHH are required to take sexual harassment prevention training annually. It was widely known throughout LHH that during his 15 years as Director of Activity Therapy, a number of complaints were filed against Frazier by subordinates for such things as sexual harassment, unequal treatment, and failure to comply with union agreements. It is unclear how LHH’s Administration responded to these voiced concerns, since the reported pattern was observed to continue from year to year.

The training may have been lost on him, since in early 2013 he was overheard screaming in his office at an Activity Therapist for over ten minutes, and allegedly called her a “selfish bitch” — clearly a sexist term that has no place in public service.

This might have been brushed under the carpet as a “he said, she said” situation, except it was overheard and reported by a witness willing to come forward. This may have been the straw that broke the camel’s back, when Frazier suddenly vanished in February; some of his duties assigned to an acting director, and other duties split to other departments.

But a month after his disappearance, amid reports he would not be back, Frazier resurfaced in LHH’s Accounting Department in a newly-created position as liaison to Friends of Laguna Honda (formerly known as Laguna Honda Volunteers, Inc., the non-profit dedicated to LHH’s patients, that never needed for 50 years any “liaison” on LHH’s staff paid from taxpayer funds).

Frazier is now in charge of LHH’s Patient Gift Fund, which should not be a 40-hour full-time job. It’s akin to having the fox guarding the hen house. That LHH created the position as a soft spot for him to land may mean the hospital is worried about potential shenanigans with the gift fund, or worried that he knew too much about the great gift fund scandal of 2010. After supervising approximately 40 staff for over a decade and a half, he no longer has direct reports or anyone to supervise.

Out of County, Out of Mind

As just one example of out-of-county patient dumping, consider the case of a middle-aged gay man who suffered a stroke one evening while at a tavern, and was taken to SFGH where he languished for months. His close friends tried to get him admitted to LHH, but were rebuffed when told he needed too much physical rehabilitation therapy and couldn’t be sent to LHH. It’s well known that delays in receiving rehabilitative therapy following strokes leads to poorer patient outcomes and progressive functional decline.

He languished at SFGH for more months until being discharged out-of-county to a facility in Antioch that principally houses patients with dementia and Alzheimer’s. Since he is not demented, he now languishes in an environment in which he has nobody to communicate with, and his friends are unable to endure the obstacles of travelling to Antioch to visit him. His family is now trying to get him discharged to take him back to Ohio for care.

There are many other similar stories of patients needing skilled nursing care who are being dumped.

Many of LHH’s department heads are concerned about DPH’s decision to reconfigure the MHRF/BHC and place the 34 BHC patients into LHH. But they remember that when former LHH Executive Administrator Larry Funk opposed admission of violent patients to LHH, he was replaced and demoted.

Other staff who opposed admission of unsafe patients, including former Medical Director Dr. Terry Hill; Dr. Maria Rivero, LHH’s former admitting physician; and others, were forced to resign.

Many dedicated staff want to make LHH a safe place for staff and patients, and they’re concerned Herrera may not know LHH doesn’t have a psych license.

There are huge human costs to patients and staff from patient dumping, and Herrera is correct that the practice is “shockingly inhumane and illegal” — and obviously unethical. But where is Herrera’s concern for out-bound patient dumping to other counties, or internal dumping between DPH’s facilities? Is he concerned only about the cost of in-bound dumping, not the costs of out-bound dumping? How does Herrera’s ethical barometer work? Will Herrera ever look in the mirror and investigate patient dumping occurring in his home town’s back yard, or is he just grandstanding?

One test of Herrera’s ethics may involve how quickly the lawsuit filed by LHH’s battered staff member is resolved. Hopefully, Herrera’s underlings won’t introduce a flaky motion for summary judgment to stall her case and delay justice in a misguided attempt to scuttle her settlement, since that would only add further insult on top of injuries.

Monette-Shaw is an open-government accountability advocate, a patient advocate, and a member of California’s First Amendment Coalition. Feedback: monette-shaw@westsideobserver.com.

June 2013

Retaliation and Bullying of City Employees

High Costs of City Attorney’s Advice

Spurious legal arguments creatively developed by Deputy City Attorneys to fight lawsuits against the City — often with the supervisory approval of the City’s Chief Labor Attorney and probably City Attorney Dennis Herrera himself — may be so misguided as to be costing the City millions of dollars, year in and year out, and may be damaging the reputation of the City Attorney’s Office.

The City Attorney and the City appear to be laboring under the age-old adage that there’s plenty of money for “Defense” (of City officials), but no money for “Butter” — relief for plaintiffs harmed who are forced to sue the City.

Troubling developments in Dr. Derek Kerr’s settlement agreement against the City for $750,000 have occurred since the Westside Observer first published details of his settlement terms in our April issue. Lawsuit Settlements

In addition, new information has surfaced regarding the 105 settlement agreements involving prohibited personnel practices against the City that have cost taxpayers at least $12.1 million over a six-year period, showing a disturbing trend in how the San Francisco City Attorney’s Office mounts its legal defense in these cases.

But the costs are substantially higher when City Attorney costs are added in … a total of 40,828 hours at a total cost of $7.726 million, above and beyond the $11 million settlement…””

“The City Attorney tried to use every pretext, lie, and smear used by the Defendants in my case to deny their whistleblower retaliation. The evidence from sworn depositions and subpoenaed documents — plus their pitiful contradictions — sank their defense,” says Dr. Derek Kerr, who was awarded monetary and non-monetary damages in his wrongful termination lawsuit settled against the City last month.

Developments in Kerr’s Settlement AgreementDr. Derek Kerr

As the Observer reported, Dr. Kerr’s settlement agreement included five non-monetary terms. Following the Board of Supervisors unanimous passage on second reading of Kerr’s settlement agreement on March 26, the City appears to have already deliberately mucked up at least three of Kerr’s non-monetary settlement deals.

First, the non-monetary provisions ordered the City to issue a formal retraction signed by Director of Public Health Barbara Garcia in the same format that former Director of Public Health Mitch Katz jointly issued with Laguna Honda Hospital (LHH) CEO Mivic Hirose in 2010, falsely accusing Drs. Kerr and Maria Rivero of not only being “detractors,” they publicly claimed Kerr and Rivero had made, and would continue to make, “false statements” — publicly defaming the two doctors as dishonest and liars.

But Garcia’s initial “retraction” notice was not signed by her, and was not in the same format that had been issued by Katz, which had been a key requirement of Kerr’s settlement agreement. Since the settlement agreement takes place under Court supervision, Kerr is required to report any departure from agreed-upon terms to his attorneys, in order to prevent any breach of his non-monetary settlement terms. After Garcia’s departure from Kerr’s settlement agreement terms was reported to the City Attorney, she was required to issue a “do-over,” and a revised retraction notice in the correct format has now been posted on the Department of Public Health’s web site.

Dr. Maria RiveroSecond, the City’s required public apology to Kerr at a meeting of the City’s Public Health Commission was improperly announced via a deficient agenda notice for the Health Commission’s April 2 meeting.

On Friday, March 29, the Health Commission released its April 2 meeting agenda, which listed agenda item seven merely as an “LHH Update.” The item carried only a subheading, not any “meaningful description” required by the Sunshine Ordinance and the Brown Act. Members of the public had no way of knowing the “LHH Update” item would include Dr. Kerr’s public apology so they may have chosen to attend the meeting, had there been a clear agenda description. Only by a stroke of accident did Kerr’s associate, Dr. Rivero, discover over the weekend that the “LHH Update” item would include Kerr’s public apology.

Once alerted, Dr. Kerr’s supporters were quickly notified, and 32 speakers attended the Health Commission’s April 2 meeting, all unanimously testifying in support of Kerr’s contributions to Laguna Honda Hospital’s hospice program. Had there been sufficient agenda notice, Kerr estimates attendance would have easily doubled.

Nobody spoke in support of Kerr’s oppressors, particularly not in support of Mivic Hirose, LHH’s CEO. Perhaps Hirose didn’t want her lackey subordinates and supporters to witness her having to publicly apologize to Kerr. Curiously, LHH’s highly-paid public information officer, Marc Slavin, was missing in action as a no-show, rather than standing beside his incompetent boss, as he typically does during public meetings.

Given the deficient agenda notice, a Sunshine Ordinance Task Force complaint has been filed by Dr. Rivero and this author regarding the Health Commission’s ongoing, deficient agenda notices. We’ll keep you posted on how the Sunshine Task Force rules on the complaint.

Third, Kerr’s settlement agreement provided that Hirose would read into the minutes of LHH’s 40-member senior Leadership Forum the commendation letter co-signed by Dr. Colleen Riley, LHH’s Medical Director and Dr. Steven Thompson, LHH’s Chief of Staff. But Hirose instead read the letter into the minutes of LHH’s much smaller Executive Committee on April 23, after which Kerr stated “We are glad that we exposed misconduct. If any of you want to blow the whistle, please contact us, ” as he was leaving handouts for the Executive Committee. Like Garcia, Hirose was required to make a “do-over.” On May 8, Hirose finally read Kerr’s commendation letter into the minutes of the Leadership Forum, as Kerr and Rivero wore home-made “Speak Truth to Power” ID badges after being asked not to bring handouts to the Leadership Forum do-over.

“Guns” or “Butter”?

There’s little injured-party relief (“Butter”) when it goes to legal Defense costs (“Guns”).

On April 16, the San Francisco Examiner carried an article by Chris Roberts regarding the $11 million awarded in the 103 prohibited personnel practice cases, which Dr. Kerr uncovered through a public records request to the City Attorney and which this reporter performed a secondary data analysis of. Roberts reported that the 103 cases filed by City employees includes “$3 million paid out in 18 racial discrimination cases and more than $1 million in 25 disability discrimination cases.” [Editor’s Note: The $11 million Mr. Roberts reported was subsequently confirmed to be even higher, at a minimum of at least $12.1 million, due in large measure to under-reporting by the City Attorney’s Office of actual settlement amounts to Dr. Kerr.]
As the pie chart in Figure 1 shows, settlements for prohibited personnel practices between 2007 and 2012 also include over $1 million awarded for “general harassment” of employees, at least $1.4 million for “wrongful termination,” $553,837 for “sexual harassment” cases, and over $4.8 million for various types of other prohibited personnel actions.

The $12.1 million doled out to settle what were at least 105 cases is one clue that there’s a lot of bullying of City employees, cases oftentimes pure, thinly-disguised retaliation involving personnel practices already prohibited by law.

But the costs are substantially higher when City Attorney costs are added in for the time Deputy City Attorney’s (DCA) spend defending the City against these lawsuits. According to a further public records request, DCA’s spent a total of 43,195 hours at a total cost of $8.3 million — above and beyond the nearly $12.1 million in settlement awards — defending the 105 cases against the City involving prohibited personnel practices. Combined, between actual settlement awards and City Attorney time fighting the cases, we’re talking at least $20.4 million in preventable waste of taxpayer funds — preventable precisely because they involve personnel practices long prohibited by law.

In the Doe and Raskin v. the City of San Francisco 9–1–1 dispatcher’s case, they were awarded $726,000, but the City spent $304,508 fighting Doe and Raskin. In the Derek Kerr, MD v. the City of San Francisco case that awarded him $750,000, the City spent $450,493 (1,740 hours) fighting Kerr!

In one of the racial discrimination cases a City employee won, he was awarded just $322,750, but new data shows the City Attorney’s Office racked up 3,107 hours fighting his case, at a total cost of $526,597. In one wrongful termination case, a City employee was awarded just $15,000, but data shows the City Attorney racked up $247,772 fighting his case. In another racial discrimination case, although the Plaintiff was awarded $1.6 million, the City Attorney spent $488,022 and 2,817 hours fighting the settlement.

Disturbingly, in a lawsuit settlement involving compensation to a City employee, while the City Attorney’s office reported the Plaintiff had only been awarded $109,583, according to the Board of Supervisors’ January 17, 2008 Rules Committee agenda, the Plaintiffs was awarded $755,000, suggesting data from two City agencies don’t jive. The City Attorney’s Office reported in had spent 1,855 hours, at a cost of $341,946, fighting the case.

The City Attorney’s Office appears to have initially under-reported to Kerr — by at least $1.47 million — the amount of settlements actually awarded to 15 of the 105 plaintiffs. The data discrepancies were uncovered by comparing data provided by the City Attorney’s office in November 2012 to data gleaned from the Board of Supervisor’s Rules Committee agendas and the full Board of Supervisors meeting minutes. The City Attorney’s Office under-reporting of actual settlement awards in the 15 cases represents 12% (almost $1.5 million) of the $12.1 million reported by the Board of Supervisors.Approved Cases

Of the remaining 90 cases, the City Attorney reported to Kerr the correct settlement award amounts for 19 cases, but it is not yet known whether 71 of these cases were accurately reported by the City Attorney to Kerr, or if the $12.1 million will soar even higher if additional inaccurate under-reporting of actual settlement awards is uncovered.

There are many other examples of small monetary settlements to City employees for various prohibited injuries, after the City Attorney racked up large sums in costs fighting the settlements every step of the way. And that’s without considering the costs of staff time spent by City department managers during lawsuit litigations, which staff time and associated costs are not tracked at the department level.

According to a retired senior human resources professional in the City who spoke recently on condition of anonymity, the City considers the costs of on-the-job bullying, retaliation against employees, and wrongful termination, to be a “cost of doing business.”

We’ve heard this justification before, including from San Francisco General Hospital nurses who acknowledge that the City may consider the failure to fix problems at SFGH that result in preventable patient outcomes, as another cost of doing business.

Supervisors Settle 305 Lawsuits Against the City

Across the same six-year period between 2007 and 2012, a total of 305 legal settlements filed against the City — for a whole host of lawsuits and other unlitigated claims beyond just prohibited personnel practice cases — were heard before the Board of Supervisors’ Rules Committee prior to referral to the full Board for consideration and approval. The 305 cases cost taxpayers a total of $104.7 million — without including the costs of City Attorney time fighting the lawsuits.

Although Dr. Kerr obtained a breakout of the types of prohibited personnel practice cases through a public records request to the City Attorney’s Office, the Board of Supervisors are required only to publish “notice” on its agendas of the major categories of cases, whether for settlements of lawsuits, settlements of unlitigated claims, or settlements for other types of cases. So it’s unclear how many of the 305 settlements involved lawsuits for Muni accidents versus, say, poor healthcare delivered at City hospitals — or bullying of, and retaliation against, City employees.

As the pie chart in Figure 2 shows, 214 of the cases heard by the Board of Supervisors involved settlements of lawsuits, fully 86.6% of all settlements. The Board heard another 60 cases involving unlitigated claims, 6 other claims, and the remaining 25 cases involved a variety of types of settlements.
It appears that the 105 cases involving prohibited personnel cases represent 34% of the 305 cases referred to the Board of Supervisors for settlement approval, and account for 11.5% of settlement awards. Clearly, the prohibited personnel practice cases and costs are completely preventable, if City managers would simply follow existing laws regarding prohibited personnel actions.
In February 2012, ABC-TV Channel 7’s KGO “I-Team” investigative journalists reported that one attorney said that all of the lawsuits and claims — not just the personnel cases — are preventable. During the six-year period it examined (a five-year period one year earlier than data reported in this article), the I-Team reported that thousands of claims and lawsuits — 10,000 of which resulted in no financial payouts whatsoever — totaled more than $212 million to resolve, plus at least $53 million in City Attorney time and costs to fight the 10,000 cases receiving no payout, ballooning to $265 million in total.

In response to an I-Team’s question about whether the $265 million was considered just a cost of doing business, City Attorney Office spokesman Matt Dorsey callously responded saying that when you consider that San Francisco spends $6.8 billion every year to run City government, “You know, it is. It’s the cost of … running a major city.” Dorsey said most of the claims and lawsuits stemmed from the vast amount of vehicles San Francisco has on its streets, without offering any proof that the $265 million in costs were attributable mostly to MUNI.

This is the same Matt Dorsey who claimed in 2004 that the wrongful termination case of Dr. John Ulrich from Laguna Honda Hospital in 1998 over First Amendment free speech issues that resulted in a negotiated $1.5 million payout to Ulrich from the initial $4.3 million jury award, was “not an instance of reprisal,” and that the City Attorney’s Office “… considers this outcome [Ulrich’s award] … [to be] an aberration.”

Dorsey probably also figures that City employees who file lawsuits regarding prohibited personnel practices such as racial discrimination and wrongful termination to be just another “aberration” to be chalked up to the costs of doing business.

High-Priced City Attorneys

At the end of calendar year 2012, San Francisco’s City Attorney’s Office alone employed 318 staff paid a combined $38.5 million in total pay, excluding 30% to 40% fringe benefits. Of the 318, the City Attorney employed 182 attorneys across seven job classification codes, paid a combined $27.8 million in total pay. Of the 138 Civil and Criminal Attorneys, 76 of them earned over $165,000, while the remaining 44 supervising attorneys averaged $190,905 in total pay, both excluding fringe benefits. Deputy City Attorneys are paid at their highest salary step of somewhere between $82.97 and $98.44 hourly (up to $204,000 or more annually), although what they charge back to City Departments and Plaintiffs per hour is significantly higher.

Although attorney’s employed by the City are paid, at most, $98.44 per hour, data provided by the City Attorney shows that in the 105 prohibited personnel practice cases, total costs of City Attorney time and expenses ranged from $165 per hour to $263 per hour, suggesting that the City Attorney bills back at an hourly rate far higher than salaries paid to lawyers employed by the City Attorney.

For his part, elected City Attorney Dennis Herrera earned $216,129 in total pay, excluding fringe benefits. He’s paid that, a taxpayer might think, to ensure his employees know what they are doing. And you might think given these attorney’s high salaries, the City’s lawyers would offer expert legal advice and would know what they we’re doing. You might be wrong, on all counts.

Questionable Rationales for “Summary Judgment”

As Mr. Roberts reported in the San Francisco Examiner on April 16, two recent and prominent City employee retaliation cases include “a pair of 9-1-1 [public safety] dispatchers who received $762,000 after City employees violated federal communications law, a jury found,” and Dr. Kerr, who received a $750,000 settlement involving wrongful termination, after complaining about misuse of the Laguna Honda Hospital patient gift fund.

In both cases, the City Attorney attempted to convince both judges in these two cases to grant a “Motion for Summary Judgment” (MSJ), a legal process in which judges make a summary judgment regarding disputed facts prior to a case advancing to jury trial. In both cases, the rationales Deputy City Attorneys used to seek summary judgment calls into question their understanding of the law.

Summary judgment is appropriate when there are no genuine disputes regarding “material” facts in a case; material facts are those that may affect the outcome of a case. Disputes as to material facts are “genuine” when there is sufficient evidence for a reasonable jury to return a verdict for the party in a case who had not sought summary judgment. The party requesting summary judgment bears the initial burden of informing the Court of the basis for its MSJ, and of identifying those portions of a case that might demonstrate the absence of a genuine dispute of material fact.

Deputy City Attorneys in both cases had to have known genuine disputes of material facts did, in fact, remain — and that there was no absence of genuine dispute — but they still petitioned both Judges for summary judgment, possibly driving up unnecessarily the costs of litigation.

Flagrant MSJ Rationale: “No City Municipal Liability”

The most flagrant issue raised in the City’s MSJ in Dr. Kerr’s case involved whether there was any municipal liability at all; municipal liability is determined using the Monell standards.

In the Defendants’ 32-page Notice of Motion for Summary Judgment against Dr. Kerr dated July 5, 2012, creative City Attorneys used four pages to claim that Kerr could not establish that the City was liable for the retaliation Kerr alleged. Defendants claimed Kerr could not assert “respondeat superior” liability against the City under Monell v. Department of Social Services, claiming it is “well settled law that ‘municipalities are answerable only for their own decisions; [and] are not vicariously liable for the constitutional tort of their agents’.” [Note: “Tort” refers to an act that injures a party in some way, for which the injured party may sue a wrongdoer for damages; here, San Francisco tried to assert that it is not vicariously liable if one City employee injured another employee.]

Respondeat superior — Latin for “let the master answer” — is a common-law doctrine that makes employers vicariously liable for actions of their employees, when their employees actions take place within the scope of employment. The doctrine was established in seventeenth-century England to define the legal liability of employers for the actions of their employees, and provides a better chance for injured parties to actually recover damages from injuries caused by an employers’ “agent” working within the scope of their employment.

Defendants attempted to assert there was no Monell liability in Kerr’s case because “Defendants Katz and Hirose did not have final policy making authority” over Kerr’s termination. The City contended it was entitled to summary judgment because Kerr had not established that Katz was a “final policymaker,” arguing instead that it was the Civil Service Commission that had final “policymaking” authority regarding San Francisco employment matters, not Katz or Hirose.

On August 9, 2012, Defendants filed an additional 26-page Reply Brief in Support of Motion for Summary Judgment, using another five pages to claim there was no municipal liability under Section 1983, arguing that Defendant Mitch Katz’s decision-making authority was constrained by other City policies prohibiting retaliation. Defendants brazenly argued that to the extent Dr. Katz or Ms. Hirose had possibly departed from policies prohibiting retaliation, their conduct could not be attributed to the City, arguing in part that Katz could not delegate to Hirose authority he didn’t possess as a final policymaker. Remind me: What rubbish is this?

In her 47-page Order ruling on the 58 pages between the City’s two MSJ briefs, Judge Wilken had to wade through issuing an eight-page analysis dissecting whether Defendants held municipal liability under Monell. Among other observations, Wilken noted the Ninth Circuit Court of Appeals has previously held that City employees to whom decision-making power is delegated, are “not authorized to violate the law,” and it is not sufficient to “insulate a governmental entity from [Monell] liability, ‘without more’.”

While Defendants argued that neither Kerr nor Rivero had subsequently applied for other vacancies on LHH’s medical staff that had become available, the DCA’s neglected to consider that since Katz as the “appointing officer” had made the decision to remove Kerr, Katz would not have been likely to rehire Kerr.

The Defendants tried to argue that a number of Civil Service Commission (CSC) rules for exempt employees constrained Dr. Katz’s ability to terminate Dr. Kerr. Wilken had to remind City Attorney’s that the Defendants’ own CSC “expert witness” had testified that “in general, no one reviews decisions” the Director of Public Health makes to lay off exempt physicians, nobody had the “authority to overrule the director of [public] health’s decisions,” and claimed the Directors’ “decisions can’t be prohibited by law.”

The Defendants’ own “expert witness” also noted that the City’s Human Resources Director does not review lay-off decisions when a complaint involves retaliation based on whistleblowing.

So Judge Wilken had to remind the Defendants’ City lawyers that “by the City’s own admission [the CSC rules] did not constrain Dr. Katz’s decisionmaking or provide for review in any way applicable to [Kerr’s termination],” as the City wrongly claimed.

Wilken observed that the City regulations Defendants cited do not provide for review of termination decisions, and simply required Katz to comply with the law. She further noted that Section 4.115 of San Francisco’s Campaign and Government Conduct Codes that can sanction officers or employees who engage in retaliation does not provide any mechanism for review or reversal of unlawful decisions. Although Defendants suggested Kerr and Rivero could have appealed, the DCA’s failed to acknowledge that there are no appeal procedures whatsoever for exempt employees who are terminated by their “appointing authorities.”

Wilken noted that, by its own terms, Section 4.115 only sets policies prohibiting retaliation against employees who file formal complaints or participate in formal investigations, but does not provide retaliation protections for employees who engage in using First Amendment free speech and subsequently face retaliation.

When will voters demand that San Francisco’s Charter be changed to include basic First Amendment protections for City employees?

After wading through reading 105 pages of motions for and against summary judgment and Judge Wilken’s Ruling, it looks to this author like the weight of evidence in Derek Kerr v. City and County of San Francisco; Mitchell Katz, Mivic Hirose, and Colleen Riley caused the Defendants’ case to fall apart.

Wilken ruled that Plaintiff Dr. Kerr had presented sufficient evidence of Monell municipal liability against the City, and denied Defendant’s MSJ to dismiss Kerr’s Section 1983 claim, putting the City on the liability hook.

City’s “Uncontroverted Facts” Claim Washes Out

At the tail end of Defendant’s MSJ dated July 5, 2012, they petitioned the Court to grant summary judgment in their favor, alleging five separate times that the Defendants “were not on notice” of Kerr’s complaints. They claimed that even if Defendants lost summary judgment, they asked the Court “to issue an order specifying certain facts were uncontroverted in order to narrow the scope of issues for trial.” Instead, Judge Wilken ruled otherwise.

Although Defendants raised many objections to evidence — which evidence and objections Judge Wilken considered — she only discussed and ruled in her Order Granting in Part and Denying in Part Motion for Summary Judgment on the admissibility of the evidence that made a difference in the case, overruling the Defendants’ other objections as moot — irrelevant.

Although Defendants contended the City Charter removes exempt employees such as Kerr through Civil Service Commission rules, Wilken noted that “even if this were true, the Charter and Administrative Code … specifically exclude exempt employees from the authority of the Civil Service Commission for removal procedures,” observing that exempt employees serve at the pleasure of appointing officers such as Dr. Katz, who are allowed to remove employees holding exempt positions without any further review, or an appeals process.

Just as DCA’s in the 9-1-1 dispatcher’s case smeared Ms. Raskin (below), City Attorney’s unnecessarily smeared Kerr. In its August 2012 Reply Brief, DCA’s wrongly claimed “It was Kerr’s enduring sense of entitlement — his refusal to shoulder the heavier workload that every other doctor agreed to — that differentiated Kerr from his peers.” This was clearly a disputed fact, which Kerr’s lawyers disproved. Defendants further smeared Kerr, writing “Plaintiff Derek Kerr likes to swim upstream. He had a comfortable existence at Laguna Honda Hospital, where many of his peers took … divergent paths to address … [needs of the patients]. Kerr refused to follow the [downstream] current.” I wondered, did the City smear Kerr again, really alleging he didn’t address his hospice patients’ needs?

The City Attorney hadn’t originated the smears, he was just “representing” the ad hominem smears, lies, and pretexts concocted by the guilty Defendants he was representing, who were grasping at straws to extricate themselves from their bungled, retaliatory hit-job against Kerr.

As a layperson having read many legal filings, this author was shocked that Defendants resorted to using smears in their legal briefs, smears clearly irrelevant and disproven by factual evidence:

·       KGO, ABC Channel 7, I-Team News Reports, May 2010: Defendants objected to evidence of the multiple investigative news reports that alleged mismanagement of LHH’s patient gift fund, claiming the evidence wasn’t relevant, lacked foundation, and was hearsay. Judge Wilken ruled the Defendants objections were overly vague and failed to provide any explanations why they believed the evidence was objectionable. Wilken noted that evidence of the broadcast news reports was clearly relevant, the evidence had been offered to prove Kerr’s assertion he was terminated as a result of the news reports, and ruled the broadcasts weren’t hearsay. Instead, Wilken ruled that Kerr had established a material dispute of facts as to whether his termination was carried out in retaliation for the ABC7 news reports. Wilken denied summary judgment on the issue.

·       Audit of Patient Gift Fund: The Defendants objected to the City Controller’s audit report of LHH’s patient gift fund, stating the audit was also not relevant evidence, lacked foundation, and was hearsay. Wilken ruled the audit report was clearly relevant to Plaintiff’s claims, and noted that “The fact that the City’s own Auditor found later that there had in fact been misuse of the [patient] Gift Fund is probative [evidence] of Defendants’ motives in terminating Plaintiff.” Wilken also noted that since the audit was issued by the City and was a public record, the report was either non-hearsay or subject to a hearsay exception. Shouldn’t the DCA’s employed by the City Attorney know these rationales won’t survive summary judgment?

·       Protected Speech: Next, although Defendants didn’t dispute that Plaintiff’s formal complaints constituted protected speech, Defendants did argue that Kerr’s public discussion of the Ja Report and gift fund records requests didn’t constitute protected speech. Defendants asserted in their MSJ that Plaintiffs’ public records requests were not protected speech, and were nothing more than requests for information. Defendants further claimed that Plaintiffs’ August 2009 speech concerning the Ja Report during a medical staff meeting — which report recommended replacing doctors with nurses, social workers, and psychologists — was speech that “didn’t address matters of public concern” (as if reducing access to physicians would not be of public concern), it was only speech regarding personnel disputes, and the speech wouldn’t reach the public at large. Judge Wilken disagreed, concluding Kerr’s critique of the Ja Report was protected speech, and that there was a material dispute of fact regarding whether Kerr’s gift fund records requests constituted protected speech.

·       Conflicts of Interest: Defendants claimed that the Plaintiff’s critique of the Ja Report “had not raised any allegations of a conflict of interest,” and that the Plaintiff had first raised the conflict of interest allegation in March 2010. However, Wilken noted that the Plaintiff had, in fact, submitted evidence that the conflict of interest issue had been raised in a September 18, 2009 whistleblower complaint, long before the eventual decision to terminate Kerr had been made. How could highly-paid City Attorney’s have missed this important timeline dispute?

·       Labor Code Violation: Plaintiff had claimed Labor Code Section 1102.5(b) provided protection against retaliation for disclosing information to a government or law enforcement agency if they believed the information disclosed violated state or federal statutes. Defendants argued that Plaintiff had not engaged in protected 1102.5( b) activity, claiming Kerr did not reasonably believe his complaints disclosed an alleged violation of federal or state law; he had not pointed to a specific statute, rule, or regulation that had been violated; and he had not clearly identified prohibited conduct to place the City “on notice” of its potential legal liability.

Although Wilken noted the conflict-of-interest allegations “could have violated several state laws” and that Kerr’s “media and formal complaints about mismanagement of the patient gift fund implicated several state laws,” she ruled that his gift fund records request didn’t point to specific violations of sections of laws (that Wilken then thoughtfully identified), and that media reports were not complaints to a government or law enforcement agency in order to provide Kerr with Labor Code 1102.5(b) retaliation protection. Wilken split her ruling on summary judgment of the 1102.5(b) issue, granting Defendants’ MSJ claim only to the extent Plaintiff alleged retaliation for his formal whistleblower complaints, records requests, and media reports about the gift fund, but denying Defendants’ MSJ claim regarding Labor Code 1102.5(b) to the extent Plaintiff had alleged retaliation for his critique of the Ja Report.

Given her rejection of many of the City Attorney’s dubious rationales seeking summary judgment in Kerr’s case, Wilken ordered that a previous ruling be maintained to begin a ten-day jury trial on November 13, 2012.

It may have only been then that the City began to negotiate in earnest to develop settlement terms with Kerr, perhaps fearing a jury trial might further unravel the City’s nincompoop defense of Katz, Hirose, and Dr. Colleen Riley, and risking greater monetary settlement awards to Kerr.

Specious MSJ Smears of 9–1–1 Dispatchers

In the 9-1-1 dispatcher’s lawsuit, Jane Doe and Anne Raskin v. City and County of San Francisco, the Deputy City Attorney (DCA) claimed there were no disputes involving material fact, and requested that eight claims for relief be granted in their MSJ. In its MSJ, Defendants also smeared Plaintiffs, claiming “Plaintiff Ann Raskin lived a charmed life at DEM prior to the e-mail incident,” a snide statement wholly out of place in a legal filing.

U.S. District Court Judge Thelton Henderson granted only one of the City Attorney’s dubious claims for summary judgment, and denied the City’s other seven claims, including:

·       Federal Stored Communications Act. Plaintiff Jane Doe claimed her private e-mail had been improperly searched by Defendants over an 18-month period on a shared computer, and was bullied and harassed by supervisors as a result. Defendants asserted there had been no search of any kind, and that Plaintiffs had no expectation of privacy — and even if the e-mails had been searched, it wasn’t a “serious” offense, which Plaintiffs refuted. DCA’s snarked, “Doe and Raskin decided that their best defense was a good offense,” and asked for summary judgment to dismiss each of the Plaintiffs claims.

DCA’s asserted that Defendant’s inadvertent discovery of Plaintiffs work-related, but personal e-mail account documents viewed on a shared computer, did not constitute a “serious invasion” of Plaintiff’s privacy. Since both sides had presented evidence supporting each version of events, Judge Henderson ruled there was a genuine issue of material fact for the jury, denying Defendants claim for summary judgment on the issue.

·       Privacy Claims: Plaintiffs alleged there was a reasonable expectation of privacy, given their union contract that explicitly states “employees [covered by the contract] shall have a reasonable expectation of privacy,” which labor agreement City lawyers must have known about. Ignoring the union contract, the DCA’s argued there was no such reasonable expectation. The Judge ruled that facts around the alleged violation of Jane Doe’s e-mail account were clearly in dispute, such that summary judgment wasn’t appropriate.

·       California Labor Code Claims: Defendants moved for summary judgment on Labor Code claims contending Plaintiffs had failed to exhaust administrative remedies through other channels. Since the Plaintiffs conceded they had not exhausted administrative remedies, the Judge granted summary judgment only on this single issue.

·       Gender Discrimination Claims: Plaintiffs alleged that the abusive mistreatment they received from their female supervisors would not have occurred had the Plaintiffs been men, since men in their workplace would not have been treated in the same manner. Defendants argued that the Plaintiffs claim of woman-on-woman discrimination seemed improbable, as if City Attorneys have never heard that women can, and do, discriminate against one another, just as men do. Since the facts underlying this claim were in dispute, the Judge ruled it a proper issue for a jury’s determination, and found it inappropriate to grant summary judgment.

·       Sexual Harassment Claim: Plaintiffs pointed to case law allowing circumstantial evidence of gender-based abuse, and contended the conduct they endured had occurred. DCA’s representing the Defendants contended the conduct was nothing more than reprimands concerning the Plaintiffs work performance, not sexual harassment. Judge Henderson ruled that there were actual disputes to the material facts regarding this issue, ruling summary judgment was inappropriate.

·       Failure to Prevent Claims: The Defendants entire argument was that there was no triable issues involving Plaintiffs claims of discrimination, harassment, or retaliation and, therefore, no misconduct had occurred that could have been prevented. Therefore, if the Court found there was a triable issue on these claims, the Defendants had made no other argument as to why the claims should be decided on summary judgment. Plaintiffs pointed out it is unlawful for employers to “fail to take all reasonable steps necessary to prevent discrimination and harassment from occurring, but that the City and County of San Francisco did nothing to step in, or investigate” Plaintiffs complaints. Since material facts underlying the claim were in dispute, Judge Henderson again ruled summary judgment would be inappropriate.

·       Retaliation Claims: The Court noted that Defendants “largely lump their retaliation argument in with their argument about the Plaintiffs’ whistleblower claims.” While the Defendants presumably disagreed with Plaintiffs contention that bullying, abuse, and negative treatment had occurred in the workplace, the Defendants devoted their argument to Plaintiffs’ “failure to exhaust remedies.”

Judge Henderson noted that the Defendants’ argument was undermined by another court case that held that employees who suffer employment-related discrimination are not required to exhaust internal administrative remedies before filing discrimination claims. Again, shouldn’t the City and its DCA’s have known this all along? Judge Henderson noted the disagreement between the two parties regarding retaliation claims was factual and was, therefore, inappropriate for summary judgment.

·       Intentional Infliction of Emotional Distress: Defendants appear to have wrongly asserted that Plaintiffs’ emotional distress claim duplicated their Fair Employment and Housing Claim. The Court had to point out to Defendants’ DCA’s that it is established law that Plaintiffs can allege both employment discrimination and additional intentional infliction of emotional distress. Yet again, shouldn’t the DCA’s — or at least their supervisor, the City’s Chief Labor Attorney Elizabeth Salveson, who was paid $184,827 in calendar year 2012 — have known this?

Instead, the DCA’s contended the conduct in question didn’t rise to emotional distress, and was merely “rigorous, difficult training that dispatcher’s must go through.” Judge Henderson again ruled the dispute involved a question of fact that had to be presented to a jury, not determined via summary judgment.

As with Dr. Kerr’s case, the City attempted to claim that the 9-1-1 dispatcher lawsuit had not identified specific violations of law by citing a particular statute, rule, or regulation that prohibited an illegal activity that was violated by the conduct complained of. The City claimed that for a complaint to be protected and upheld, the complaint must specify violations of law by citing a relevant statute that was violated.

“The Truth [of Retaliation] Was True”

By denying seven of the Defendants’ eight claims for summary judgment, Henderson effectively moved Jane Doe and Anne Raskin v. City and County of San Francisco to trial. At trial, the jury ruled in Doe and Raskin’s favor, and they were eventually awarded the $762,000 settlement, suggesting that the City — City Attorney Dennis Herrera and his legal defense teams — often barks up the wrong tree, tossing out flaky defense strategies hoping to see what will stick on the wall.

To do that, Herrera’s team not only resorted to using ad hominem smears against Plaintiffs Kerr and Doe and Raskin, they used wrongful claims and disingenuous arguments, and ended up acting just like their clients — the Defendants.

Such strategies drive up the time and costs of litigation, costing taxpayers millions of dollars, and forcing opposing counsel and judges to wade through the muck of what is, essentially, garbage proffered as the City’s legal defense. Desperate to prevail, the City Attorney continues doing so, anyway.

“The City Attorney used every trick in the book — but the evidence of Laguna Honda Hospital’s wrongdoing was so overwhelming, that they were forced to settle,” notes Dr. Rivero. “It took us three years to convince the City Attorney — and the Court — that the truth was true,” she laments.

If Kerr’s and the 9-1-1 dispatchers lawsuits prove nothing else, the two cases demonstrate that all too often the City Attorney defends City officials against City employees and the very citizens paying the miscreant officials’ bloated salaries.

After all, between the settlement awards and the City Attorney’s costs fighting the prohibited personnel practices, we’re talking about a minimum of at least $20 million that was a completely preventable, unnecessary expense, had careless City managers who bullied City employees simply followed existing personnel law.

It’s long past time to confront the City Attorney’s spurious legal advice, which appears to be costing taxpayers millions that could be better spent on other City needs.

Monette-Shaw is an open-government accountability advocate, a patient advocate, and a member of California’s First Amendment Coalition. Feedback: monette-shaw@westsideobserver.com.

A Comical Postscript

In a comical twist of irony, City Attorney spokesman Matt Dorsey rises again.
On May 16, the San Francisco Examiner reported that the day before a former internal affairs attorney for the San Francisco Police Department — Kelly O’Haire — filed a wrongful termination and whistleblower lawsuit in San Francisco Superior Court against Police Chief Greg Shur, against the Police Department, and presumably, against the City.

O’Haire’s job involved investigating and prosecuting misconduct claims against San Francisco Police Department members, and bringing misconduct cases before the Police Commission. O’Haire alleges she was fired in retaliation for having investigated Greg Shur when he was a high-ranking official before being appointed Police Chief. She sought Suhr’s termination in 2009 for an alleged pattern of misconduct and policy violations. Following Suhr’s appointment as Police Chief in April 2011, O’Haire was terminated within a month.

Dorsey is comical: On May 15, the Marin Independent Journal carried an article by Gary Klein reporting on O’Haire’s lawsuit. Dorsey, City Attorney Dennis Herrera’s spokesman, asserts O’Haire’s lawsuit “lacks merit.” Dorsey was quoted as saying “The City Attorney is going to vigorously defend the Police Department, and we’re going to do everything we can to protect taxpayer dollars.”

This is the same City Attorney’s Office that settled the 105 prohibited personnel practice cases for the princely sum of $12.1 million, and the same City Attorney who spent $8.3 million fighting the 105 cases, for a combined waste of $20.4 million in taxpayer funds. And that’s not including the $1.3 million of taxpayer funds racked up in City Attorney time wasted during the City Attorney’s inept proceedings on behalf of Mayor Ed Lee to oust Sheriff Ross Mirkarimi for alleged official misconduct. After wasting fully $22 million, Dorsey now wants us to believe the City Attorney is trying to “protect” taxpayer dollars?

Supervisor Jane Kim noted during the Board’s vote to remove Mirkarimi that the charges against the Sheriff — developed by the City Attorney on behalf of the Mayor — did not rise to the City Charter’s definition of official misconduct, and that the Ethics Commission had not found that Mirkarimi had used his official duties to commit wrongdoing. Kim voted against removing the Sheriff, indicating that a clear, articulable test to remove public officials had not been established. To that extent, the persecution of Mirkarimi was a complete waste of $1.3 million in City Attorney time, at taxpayer expense, which appears to have escaped Mr. Dorsey.

Chances are that as O’Haire’s case plods through the court system, the City Attorney will likely mount spurious reasons for a motion for summary judgment. But O’Haire will likely prevail and will probably win a significant settlement amount, while the City Attorney wastes more taxpayer funds spending thousands of hours fighting O’Haire.

After all, this is San Francisco, where whistleblowing City employees who expose wrongdoing of high-level members of the “City Hall Family” — for example exposing the City Family’s former Director of Public Health Mitch Katz, former Housing Authority Director Henry Alvarez, and now Police Chief Greg Suhr — face 100% retaliation, bullying, and wrongful termination. Is the 100% retaliation rate a new San Francisco “value”?

The print edition of this Westside Observer article was a condensed version; this expanded version — providing additional details of the spurious rationales the City Attorney used seeking summary judgment, a status update on Kerr’s non-monetary settlements, and data regarding costs of prohibited personnel practices —Is available on-line at www.westsideobserver.com.

May 2013

Laguna Honda Hospital’s Whistleblower Retaliation

The $750,000 Wrongful Termination Affair

Dr. Derek Kerr and Dr. Maria Rivero at City Hall
Retaliation against Laguna Honda Doctors reveals how the City does business

Three years after jointly filing three whistleblower complaints with his colleague Dr. Maria Rivero, Dr. Derek Kerr’s wrongful termination settlement agreement was finally approved on second reading by San Francisco’s Board of Supervisors on March 26, awarding him $750,000 in monetary damages and other non-monetary awards.

Kerr’s settlement is one of the largest pre-trial (out-of-court) settlements in San Francisco history, although post-trial settlements have been larger.

Like many great mysteries, the great Laguna Honda Hospital Patient Gift Fund scandal of 2010 started with some curiosity, ethical concerns, and a compelling public-interest question: If the fund was nearing “bankruptcy,” what had happened to the money?

…they believed the law … which clearly prohibits termination, demotion, or suspension of City employees as retaliation for reporting waste, fraud, and inefficiencies in City government to the Ethics Commission, City Controller, District Attorney, or
City Attorney.”

When former Laguna Honda physicians Kerr and Rivero put on their detective hats, neither expected that the age old question “show us the money” would quickly result in prompt retaliation, harassment, and wrongful termination. Neither did they expect Kerr would eventually win the largest pre-trial settlement in City history.

At the outset of their sleuthing, they believed our democracy functions only when citizens know what our government is doing. Believing public participation is essential to our democratic process, the two doctors take seriously their role to speak as patient advocates.

The sordid patient gift fund mystery started with a classic example of mismanagement over a small issue — reimbursement to Dr. Rivero for a mere $100 she had spent for tacos for LHH’s Spanish Focus ward in September 2009. The taco luncheon was to celebrate Fiestas Patrias — Latin America’s Independence Day — on a ward where the majority of patients had various forms of dementia. Told that the $2 million gift fund was nearing insolvency and couldn’t reimburse her, Rivero and Kerr became gumshoes when they requested and began researching 10 years of gift fund public records on October 31, 2009.

the so-called apology letter
Official Apology from Laguna Honda to Dr. Derek Kerr: Buried in an update to the Health Commission, the apology, rarer than hen’s teeth and even more valuable, possibly saved the City more than a million dollars. Had they refused to apologize and continued through with the lawsuit, so many laws were broken that a jury would probably have awarded considerably more.

After examining thousands of pages of public records and placing serial records requests, the pair felt they had no ethical choice but to file an Ethics complaint on March 2, 2010, which clearly documented mismanagement of the patient gift fund. Just hours after submitting copies of their whistleblower gift fund complaint with the Ethics Commission on March 4, it reached the District Attorney and retaliation against them was set in motion, after they had simply exercised their First Amendment rights to free speech.

When San Francisco Department of Public Health officials wrongly retaliated by notifying Kerr orally on Friday, March 5, 2010 that his employment would be terminated, the officials had to have done so willfully. The officials should have known that they would be violating the First and Fourteenth Amendments to the U.S. constitution, other Federal law, at least three State laws, and San Francisco’s own Administrative Code that prohibits retaliation.

This has so many themes that reverberate throughout City Hall – the influence of
private money, the misapplication of
purpose of the money, the automatic defense of incompetent administrators, and most of all the acceptance of corruption as “business as usual” all the way to the top."
James Chafee

If the City had hoped to silence Kerr by firing him, the retaliation backfired, leading the whistleblower doctor to not only speak out more forcefully, the retaliation led to a huge settlement when Kerr prevailed in his wrongful-termination lawsuit.

As Dr. Kerr and Dr. Rivero wrote in their July 2012 Westside Observer article, “Secret Investigations,” whistleblowers should not be silenced in the resolution of the alleged misconduct they risked their careers to challenge. But that’s exactly what the City of San Francisco attempted to do: To silence the pair of doctors.

When Dr. Kerr and Dr. Rivero filed a trio of Ethics complaints, they believed that a collection of laws would protect them from retaliation. They believed that their fundamental First Amendment rights to free speech and their Fourteenth Amendment rights to due process would protect them from exposing fraud, waste, and corruption. They believed 42 U.S.C. §1983, which provides protections for citizen’s injured by deprivation of Constitutional rights and which provides redress for violations of due process, would help protect them. They hoped that the federal Whistleblower Protection Enhancement Act of 2012 might help protect them.

They believed that California Government Code §53298, California Health and Safety Code §1432, and California Labor Code §1102.5 — which each provide separate prohibitions against employee retaliation — would protect them.

And they believed the letter of the law in San Francisco Administration Code §4.115, Protection of Whistleblowers, which clearly prohibits termination, demotion, or suspension of City employees as retaliation for reporting waste, fraud, and inefficiencies in City government to the Ethics Commission, City Controller, District Attorney, or City Attorney.

Kerr and Rivero were wrong. None of these so-called “laws” ended up protecting them, and Kerr was forced to sue after being wrongfully terminated.

“I didn’t want to sue the City,” Kerr testified to the Board of Supervisors Rules Committee on March 7, 2013. “But Dr. Maria Rivero and I stumbled upon wrongdoing involving Laguna Honda Hospital’s CEO that we couldn’t ignore,” he testified. [Editor’s Note: Kerr was diplomatically referring to Mivic Hirose, LHH’s then- and current-CEO.]

A Public Spanking: Kerr’s Settlement Award

Kerr and Rivero were represented by the law firm of Kochan & Stephenson — Deborah Kochan and Mathew Stephenson — whose law practice is devoted entirely to representing employees who have suffered discrimination, harassment, retaliation, or — as in Dr. Kerr’s case — retribution for whistleblowing.

Dr. Rivero testified, “What is the message you send when a CEO … is still in office?
It shows that you condone whistleblower
retaliation and violations of laws that
protect whistleblowers
.” Rivero added,
“It shows that you will accept executives
who pilfer public funds donated to the poorest of the poor
, violating a sacred trust.”

In addition to Kerr’s $750,000 settlement award, there were a number of non-monetary concessions that amount to a public spanking and public apology that are important to him, including:

  1. A retraction of the “Statement Concerning the Laguna Honda Gift Fund” posted on LHH’s website by Katz and Hirose on September 2, 2010 alluding to Kerr and Rivero as “detractors” who had intentionally made false or inaccurate statements regarding the patient gift fund, since the September 2010 letter presented incorrect representations of the two doctors. The retraction will be via a notice signed by the Health Department’s current director, Barbara Garcia, to be posted on DPH’s web site within 10 business days following final approval of the settlement by the Board of Supervisors on March 26, for a minimum 10-month period.
  2. LHH must install a plaque as soon as practicable in a clearly visible location, recognizing Kerr’s contributions to the hospital generally, and his contributions to LHH’s Hospice and Palliative Care Program in particular, in either LHH’s new Hospice or the gazebo/garden area, once it is completed.
  3. LHH must provide Kerr, within 10 business days of the final settlement approval, a commendation letter signed by defendant Colleen Riley, MD, and LHH’s Chief of Staff, Steven Thompson, MD, stating that Kerr was a physician in good standing and widely respected by his LHH colleagues for his skills and accomplishments as a hospice and palliative care physician, and commending his work establishing and running LHH’s hospice and palliative care program.
  4. LHH’s CEO, Mivic Hirose must announce at both the next scheduled meeting of the Health Commission and the next meeting of LHH’s 40-member Senior Staff/Leadership Forum, both the pending installation of Kerr’s plaque and read into the minutes the letter signed by Riley and Thompson.
  5. The City must provide training to LHH’s Executive Committee regarding whistleblower rights, and First Amendment rights, of City Employees.

For their part, Kerr’s lawyers Kochan and Stephenson, note: “In our experience, negotiating non-monetary terms as part of a settlement is relatively rare. But here, we believed it very important that LHH’s administration publicly acknowledge the lies they told about Drs. Kerr and Rivero, as well as acknowledge the extraordinary service the two MD’s provided to the community during their long and distinguished careers at LHH.”

As for the two doctors, the monetary and non-monetary awards help convey that their complaints had all along been valid, and that wrongful, retaliatory termination and harassment had ensued.

The Defendants

Dr. Kerr — a former physician in good standing at Laguna Honda Hospital for over 21 years — filed a lawsuit seeking monetary and non-monetary damages, in part, to recover his good name.

Named as defendants in his lawsuit were the City and County of San Francisco and three named individuals — Dr. Mitchell Katz, former Director of Public Health; Mivic Hirose, RN, Laguna Honda Hospital’s Executive Administrator; and Colleen Riley, MD, Laguna Honda Hospital’s Medical Director.

Legal documents filed in the case show the defendants may have been motivated by retaliatory animus towards Kerr. They subjected him to retaliation for having brought complaints related to the care of patients and services at LHH. Had Kerr’s case proceeded to trial, it is very likely a jury would have concluded the defendants had been highly motivated to silence Kerr by subjecting him to retaliatory termination — and a jury would likely have awarded him much more than three-quarters of a million dollars, if for no other reason than sympathy for LHH’s patients.

Basis of Kerr’s Lawsuit

Dr. Kerr’s Complaint for Damages and Demand for Jury Trial lawsuit filed in San Francisco Superior Court on November 16, 2010 — subsequently transferred to a Federal District Court over First Amendment freedom of speech issues — listed five causes of action for violations of Federal and State law:

  • • Deprivation of his First Amendment freedom of speech activities;

  • • Deprivation of due process rights guaranteed by the Fourteenth Amendment;

  • • Violation of California Government Code §53298 that prohibits reprisals against employees who file complaints regarding gross mismanagement or a significant waste of funds, or an abuse of authority;

  • • Violation of California’s Health and Safety Code §1432 that prohibits discrimination or retaliation against employees for initiating or participating in proceedings relating to care, services, or conditions of a long-term health facility; and

  • • Violation of California Labor Code §1102.5 that prohibits retaliation against any employee for disclosing information to a government or law enforcement agency when an employee has reasonable cause to believe that the information discloses a violation of state or federal statutes, or a violation or noncompliance with a state or federal rule or regulation.

Four of the five causes of action noted that the individual defendants participated in, directed, or knew of the retaliatory termination, and they collectively failed to act to prevent it. The causes of action also alleged that the gross retaliation by the individual defendants was done with malice, fraud, or oppression, in reckless disregard of Dr. Kerr’s constitutional rights.

The Set Up: Pretext for Termination

According to Kerr’s lawyers’ “Plaintiff’s Opposition to Defendants’ Motion for Summary Judgment,” dated August 9, 2012, there were a number of reasons to suspect the defendants manufactured various pretexts to justify terminating Kerr.

It appears that Dr. Katz and Ms. Hirose had already determined by December 15, 2009 that they were going to lay off Dr. Kerr, hoping to shut him up. They needed a pretext, or pretexts, to do so, since Kerr and Rivero’s Sunshine requests on October 31, 2009 for patient gift fund records had put Katz and Hirose on notice that they were under scrutiny for a host of improper, if not illegal, practices. Hirose had to have known there was a lot at stake over her management, or mismanagement, of the patient gift fund, and that she was likely in deep trouble.

After all, by that point Kerr and Rivero had already filed in September 2009 two Whistleblower complaints about DPH contracts tainted by conflicts of interest, and had put the City on notice with their October 31 request for 10 years of patient gift fund public records that the two whistleblower doctors were serious about investigating the gift fund scandal. The defendants knew Kerr’s and Rivero’s records requests were very serious, and that the two doctors had a demonstrated record of investigating and thoroughly analyzing data. Hirose was on notice that she was under Kerr’s and Rivero’s microscope, and that it could be damaging to Hirose’s career.

Much of the City’s defense regarding Kerr’s termination was pretextual — pretexts the City manufactured to justify his dismissal, but were actually pretexts for retaliation. The pretexts to lay off Kerr included false claims that:

  • Kerr was terminated as a mid-year budget savings reduction, claiming a budget crisis. During FY 09-10, DPH had nearly 8,000 employees on its payroll, but only one employee — Dr. Kerr — was terminated, ostensibly to “save money.” Notably, LHH’s Medical Services Department staff increased by 10% after Kerr’s layoff, and the physician who replaced him — Dr. Denis Bouvier — quickly zoomed to being the City’s highest-paid employee, earning $332,000 that year. In addition, the City added a Clinical Nurse Specialist, Anne Hughes, RN, PhD, to the Hospice’s budget, paying her $160,000 annually. LHH’s expenses on Hospice, and throughout the hospital, went up after Kerr’s “mid-year budget reduction” layoff. Obviously, money wasn’t the problem, but a clear pretext for retaliation.

  • Kerr had limited himself to a 25-patient case load and was unwilling to take on additional patients, even if keeping his job depended on it.

  • The hospice physician in the new hospital would have to carry a 60-patient case load, which didn’t apply to doctors on admitting wards, such as the Hospice where Kerr was an admitting physician.
  • Kerr wouldn’t cover wards outside the Hospice, clearly disproven during depositions.
  • The hospice would be undergoing a “fundamental program change,” which Hirose eventually testified there had never been any discussion about a “program change.”
  • Kerr was terminated for budgetary reasons, which was false because when Kerr left LHH in June 2010, he was immediately replaced by another budgeted physician.

Another glaring pretext was Hirose’s claim that her decision in mid-December 2009 to terminate Kerr was based on information Dr. Riley had provided indicating Kerr was unwilling to take on covering additional Wards.

During depositions, Riley indicated that she hadn’t reported to Hirose Kerr’s reluctance to take on additional ward coverage until late February 2010, and that she, Riley, had never asked Kerr if he was willing to take on more patients if retaining his job depended on it.

During Hirose’s own initial deposition, she was unable to explain the impossibility of knowing in mid-December 2009 an allegation about Kerr from Riley, since Riley testified she had not shared this information with Hirose until late February 2010. The conversation with Riley that Hirose claimed to have relied on to terminate Kerr wouldn’t happen for at least a month until after she and Katz had already cooked up a pretext to eliminate Kerr.

In a follow-up to Hirose’s deposition nine months after her first deposition, Hirose sill couldn’t explain the “timing problem” that had made her explanation to terminate Kerr clearly impossible, given Riley’s false claim that Kerr wouldn’t take on additional patients. As set-ups and pretexts often are, Hirose’s claim that Kerr wouldn’t provide additional Ward coverage was completely insane.

Depositions: Discovery Mountain

Given public records in the case, the mountain of evidence against the City obtained during discovery and depositions in Kerr’s case was appalling.

During depositions and discovery, one defendant after another was crushed. Kerr’s lawyers deposed a dozen or so City employees; the City Attorney, in return, deposed only Kerr and Rivero. The City didn’t bother deposing Kerr’s union, UAPD, knowing that the union’s deposition would likely be damaging against the City. Kerr’s lawyers obtained approximately 3,000 pages of documents and issued multiple interrogatories.

Eventually, the City realized how bad their case looked for Laguna Honda and the Department of Public Health after its own witnesses performed poorly during depositions, and when plenty of smoke rose during discovery.

The City stonewalled Kerr’s lawsuit for two years, until his case was finally scheduled for jury trial on November 13, 2012. In mid-summer 2012, the City submitted a Motion for Summary Judgment that would have effectively dismissed Kerr’s case had the motion succeeded. Kerr’s lawyers submitted a Plaintiff’s Opposition to the City’s Motion for Summary Judgment on August 9, stating that given the “genuine issues of disputed fact … the defendants’ motion for summary adjudication … should be denied.”

Judge Claudia Wilken denied the City’s Motion for Summary Judgment in part and approved it on other parts in a 47-page ruling dated September 6, 2012. Wilken’s Order Granting In Part And Denying In Part Motion For Summary Judgment noted: “Plaintiff has offered sufficient evidence that he disclosed to his government employer possible violations of state or federal law based on the conflicts of interest involving Dr. Ja and Ms. Sherwood in [Kerr and Rivero’s] “A Job Half Done” critique, and that this was causally connected to his termination.”

Wilken also wrote: “[Kerr’s] media and formal complaints about the mismanagement and misuse of the Gift Fund also implicated several state laws … However, the public records requests related to the Gift Fund did not show any reasonable belief on Plaintiff’s part that he was disclosing alleged violations of [several] sections [of California’s Business and Professional Code]. The media reports about the Gift Fund were not complaints directed to a government or law enforcement agency, as required to come under the protection of [California Labor Code] section 1102.5(b).”

Wilken’s partial denial — which kept Kerr’s lawsuit alive and headed to jury trail — suggests the City then knew it had to settle with Kerr or risk a jury’s outcome, since it appeared Kerr had a potentially valid case. Only when the City realized it was on notice to proceed to jury trial did it conclude negotiating an equitable settlement with Kerr.

Laughably, the defendants appeared to have argued that Kerr’s speech was not protected by the First Amendment because it “did not address matters of public concern,” and would not reach the public at large, as if the raid of funds intended for patients didn’t concern public donors to the fund. The City also lamely tried to exonerate the defendants by claiming that Kerr’s and Rivero’s serial requests for gift fund records was not protected speech because it was “nothing more than a request for [public] information.” To support its defense, the City ignored that defendant Hirose had lied repeatedly about the status of the Gift Fund as it existed in late 2009, according to legal documents.

The City also attempted to exonerate Director of Public Health, Mitch Katz, claiming Katz wasn’t a policymaker “decider,” he was simply a decision-maker. Katz had delegated to Hirose the decision of which staff to lay off (terminate), but Kerr’s lawyers adroitly noted that layoff decisions were within the sole discretion of the Director of Public Health, Katz, responsibility for which could not be avoided by delegating that decision to Hirose.

The City also attempted to assert that the Civil Service Commission, not the DPH’s Department Head, had final policymaking authority to remove Kerr, though that assumption is supported neither by facts nor applicable law, since appointments of doctors are exempt from Civil Service merit system protections and, instead, serve at the pleasure of their appointing authorities.

The defendants conceded that Katz made a deliberate choice fingering Kerr for layoff from among several competing proposals on how to implement mid-year budget reductions. Katz could have, but failed to, rescind Kerr’s layoff notice. Instead, Katz participated in, and explicitly supported, Hirose’s decision to terminate Kerr.

Commenting on the discovery and deposition process, Kerr’s lawyer Deborah Kochan says, “The deceitfulness and small-mindedness exhibited by members of LHH’s administration and its Human Resources Department was, at times, breathtaking.”

“The City was boxed in by the inconsistent accounts of its own witnesses and the absolute nonsense of some of their testimony on critical issues,” adds Kochan’s law firm partner, Mathew Stephenson.

Acting Under “Color of Law”: A Federal Crime

42 U.S.C. §1983 provides that every person acting under the “color of law” who causes any United States citizen to be deprived of any Constitutional rights shall be liable to the party injured. “Color of law” involves actions taken that superficially appear to be within an individual’s lawful power, but are actually in contravention of the law. Acting under “color of law” is misuse of power, since it involves acting under real or apparent government authority by people who misuse their authority to violate rights guaranteed by federal law. Depriving a person of his or her federal civil rights under color of law is illegal and grounds for a cause of legal action.

The City acted under the color of law when it deprived Dr. Kerr of his First Amendment rights to freedom of speech. He was terminated, in part, because he had spoken out on various matters of public concern; he had spoken as a private citizen, not as a public employee; and his protected speech was a substantial or motivating factor in the City’s termination of him.

By reaching a settlement agreement with Kerr for monetary and non-monetary damages, the City has effectively acknowledged that Riley, Hirose, and Katz had engaged in misuse of power and misuse of their authority, depriving Kerr of his Federal civil rights. Despite this, Riley and Hirose are still employed at Laguna Honda Hospital, while Dr. Katz suddenly and mysteriously vanished.

Katz abruptly moved to Los Angeles after the LHH patient gift fund scandal exploded, and after Kerr and Rivero had filed their complaints about tainted DPH contracts. Katz’s sudden departure may have been coincidental, but it was completely odd, given he had previously stated he wanted to remain as Director of Public Health until the rebuild of the new San Francisco General Hospital was completed. It’s unknown whether the City Attorney, or other City Hall Family insiders, had advised Katz to quickly resign when the issue of his HMA consulting fees income became widely known.

During the Board of Supervisor’s Rules Committee meeting on March 7, 2013 at which it recommended approval of Dr. Kerr’s settlement agreement, Dr. Rivero testified, “What is the message you send when a CEO [such as Hirose] who retaliated against a whistleblower is still in office? It shows that you condone whistleblower retaliation and violations of laws that protect whistleblowers.” Rivero added, “It shows that you will accept executives who pilfer public funds donated to the poorest of the poor, violating a sacred trust.”

That Hirose and Riley remain employed at LHH is shocking in a City that pays a lot of lip service claiming it believes in transparent, open government and public accountability.

Series of Whistleblower Complaints

Drs. Rivero and Kerr filed three complaints through the Controller’s Office and the Ethics Commission regarding fraudulent practices in the Department of Public Health, including:

  • On September 18, 2009, Kerr and Rivero filed their first complaint alleging an improper award of a contract to a City employee’s relative, regarding what became known as the “Ja Report.” In July 2009, Davis Ja and Associates prepared a report examining mental health services for LHH’s residents; defendant Hirose served on the selection panel that awarded Ja his first contract to survey LHH. The Ja Report recommended replacing Laguna Honda doctors with social workers, psychologists, and nurses.

    Drs. Kerr and Rivero regarded the reduction in the number of physicians as a threat to, and would negatively impact, the quality of patient care. The Ja report was so deeply flawed that Kerr and Rivero co-authored a 25-page Critical Analysis: The Ja Report – A Job Half Done, highlighting the flawed methodology of Ja’s report and recommendations. Of 22 physicians on LHH’s regular Medical Staff, 20 (91%) co-signed a petition supporting Rivero’s and Kerr’s thoughtful Critical Analysis, which detailed serious, ethical conflicts of interest involving several high-level managers in the Department of Public Health. Subsequently, Ja was awarded an additional multi-million dollar contract.

    Kerr and Rivero then discovered the additional contract had more than likely been steered to Ja by his wife, Deborah Sherwood, a senior manager in the Health Department’s Community Behavioral Health Services unit. Despite the two doctors’ numerous attempts to bring this improper and probably illegal contract award to the attention of City officials, nearly two years after filing their whistleblower complaint regarding Ja, the City Controller finally stepped in and abruptly terminated Ja’s additional contract, withholding over $400,000 in remaining contract funds.

  • Three days later, on September 21, 2009, Kerr and Rivero filed a second complaint alleging that the then Director of Public Health, defendant Mitch Katz, may have engaged in a conflict of interest by accepting — according to FPPC public records — somewhere between $30,000 and $300,000 in consulting fees from Health Management Associates (HMA), a City contractor performing consulting services for the Department of Public Health. Both San Francisco’s Conflict of Interest policies and the California Political Reform Act prohibit government employees from participating in making of contracts with companies in which they have a financial interest.

  • On March 2, 2010, Rivero and Kerr filed their third complaint regarding the raid of LHH’s patient gift fund, which scandal has been thoroughly reported in past issues of the Westside Observer over the past three years. The scandal was also broadcast in two KGO I-Team investigative reports in May 2010, which defendants Katz and Hirose had viewed, and which Katz and Hirose had responded to by publically posting on LHH’s web site a statement that Kerr and Rivero were mere detractors who were making false statements.

    The two doctors had discovered that patient funds had been quietly diverted to three separate accounts for staff perquisites and amenities, and increasingly used for the “comfort and benefit” of staff and administrators, instead of patients. This feat was engineered by LHH’s then Executive Director, John Kanaley, who had quietly authorized setting up accounts for staff training within the patient gift fund, and had permitted inter-account transfers for staff amenities.

    The City Controller’s audit of the clear misappropriation of charitable contributions intended for patient amenities languished for months, but the Controller’s highly-publicized audit finally ordered in November 2010 return of $350,000 improperly removed from the gift fund. [Editor: The City Controller’s restoration of funds to the patient gift fund is available in the Westside Observer’s December 2010 issue, at “Controller Restores $350,000 to Laguna Honda’s Patients.”]

Who Are These Two Doctors?

Rivero and Kerr take their professional and ethical obligations as doctors seriously. They passionately believe, having taken the Hippocratic oath to first do no harm, that among their responsibilities is to fully embrace advocating for patients.

Derek Kerr, MD, CNA attended Harvard Medical School, did his residency at Harlem Hospital and his Oncology Fellowship at Memorial Sloan-Kettering Cancer Center. He has the rare distinction of being Board Certified in three separate medical specialties: Internal Medicine, Medical Oncology, and Hospice and Palliative Medicine. Following his medical education and years of practicing medicine, he went back to school and became a Certified Nursing Assistant in 1988 to better understand patient care from a nursing perspective. Kerr was the Attending Physician of Laguna Honda’s Hospice for 21 years, was listed as LHH’s Palliative Care Consultant on the Medical Staff roster, and had been the Attending Physician assigned to LHH’s “Hospice and Palliative Care” service since 1994. During his tenure, LHH’s Hospice was widely acclaimed, receiving a national award. Kerr was Chair of the Bioethics Committee at Fairmount Hospital prior to employment at LHH.

Maria Rivero, MD, FACGS, graduated from UCSF Medical School and completed her residency at Beth Israel Hospital/Harvard Medical School. She is Board Certified in both Internal Medicine and also Geriatrics, and is a Fellow of the American College of Geriatrics Specialists. She also has been a Certified Eden Alternative Associate since 1998. Rivero worked at Laguna Honda Hospital for 22 years, and served as LHH’s Medical Director and its Assistant Medical Director between 1997 and 1999.

As former co-workers at LHH, Rivero and Kerr were highly regarded by hospital staff as among the best doctors in the hospital. As a team, they became whistleblowers at great professional risk to their careers; their core belief in ethical behavior led them to become whistleblowers, even though they never imagined initially that they would ultimately become involved in exposing fraud and corruption.

Correcting the Record: “No One Spoke Up”

In April 2012, as Kerr’s lawsuit dragged on, another former physician at Laguna Honda Hospital, Dr. Victoria Sweet, published her 348-page memoir about the hospital, titled God’s Hotel, which was riddled with errors and which, among other flaws, contained not one date to place her reporting into chronological or historical perspective. Among many other errors, Sweet incorporated three glaring untruths about Dr. Kerr. Sweet should have known better, since events in Kerr’s lawsuit had been unfolding for fully two years before she published her memoir. Sweet never bothered fact checking with Kerr or Rivero during the years she spent writing her memoir.

First, Sweet wrongly reported that a “Dr. Talley” — the pseudonym Sweet assigned to Laguna Honda’s medical director, Dr. Colleen Riley, one of the named defendants in Kerr’s lawsuit — claimed that it had been she, Dr. Talley, who had made the decision to terminate Dr. Kerr. Sweet reported that “Dr. Talley” announced during her first meeting as Medical Director of Laguna Honda’s medical staff, that it had been “entirely her decision” to lay off Dr. Kerr, and that then Director of Public Health Mitch Katz and LHH’s Executive Administrator Mivic Hirose had had nothing to do with the decision to terminate Kerr.

In fact, Mivic Hirose herself has claimed elsewhere that it was entirely her decision — not Dr. Riley’s — to terminate Dr. Kerr. Indeed, during depositions in Kerr’s case, it appears that Katz and Hirose decided on December 15, 2009, or earlier, to lay off Dr. Kerr, several weeks before Riley was appointed Medical Director at the end of December. When she learned of Katz’s and Hirose’s decision to target Kerr, Riley did nothing as Medical Director between January and March to stop the clear retaliation.

Next, Sweet wrongly opined that one of Dr. Kerr’s “principles” was that he would only take care of his own patients [at LHH, and that] he “almost never took call, or helped out, or covered other wards. So no rebellion broke out [when Kerr was terminated], and no one spoke up [when the Bell Tolled for Dr. Kerr].” But during discovery in Kerr’s case, LHH produced Ward Coverage Schedule records showing Kerr had, indeed, often provided coverage on other wards, took call, and often “helped out.” During depositions, Kerr’s lawyers showed that Kerr had, in fact, performed ward coverage, even more so than Dr. Riley had in some years. Other doctors also testified under oath that Kerr had done his share of coverage.

Sweet’s claim no one spoke up, and no rebellion broke out was a complete lie. A second petition opposing Dr. Kerr’s and Dr. Bouvier’s proposed layoffs — which requested both layoffs be rescinded — was signed by 16 physicians, including Dr. Sweet herself. The second petition, a “Statement of Concern,” was sent to defendant Dr. Colleen Riley and to Steven Thompson, MD, the Chief of Staff of LHH’s Medical Service, who forwarded it to Ms. Hirose.

Of the 20 doctors on the regular staff (excluding MD administrators), Kerr had 18 supporters, 16 of whom signed the petition — representing 80% — who were strongly opposed to Kerr’s layoff; thus, well over three-quarters of the regular Medical Staff had indeed spoken up, which Sweet had to have known but elided. [Although Bouvier’s layoff was rescinded and he went on to become the City’s highest-paid employee, Kerr’s layoff wasn’t rescinded.]

In addition, despite the environment of fear among LHH staff resulting from the culture of intimidation generated by LHH’s administration, all six members of the Hospice team risked their careers by signing and submitting a letter of support opposing Kerr’s layoff. Along with Rivero, the Hospice’s nurse manager, its social worker, and Dr. Monica Banchero-Hasson and Dr. September Williams also risked their careers by publicly testifying against Kerr’s layoff at a meeting of a Health Commission subcommittee — LHH’s so-called Joint Conference Committee made up of senior hospital administrators and three Health Commissioners.

Dr. Williams — a nationally recognized expert on Ethics, and a member of LHH’s Bioethics Committee — stated during the LHH-JCC’s March 23, 2010 meeting that she “protests the layoff of Drs. Kerr and Rivero because it will impact the provision of quality care to Laguna Honda’s most vulnerable and needy residents, and is against the principles of beneficence.” Sweet had to have known of the groundswell of support by those who, in fact, did speak up defending Kerr.

Third, Sweet also misreported the sequence of Kerr’s lay off and the timing of filing of his whistleblower complaints. Sweet sloppily reported Kerr had filed a whistleblower [law] suit “the day after his layoff … ‘alleging’ that his investigation of the drained Patient Gift Fund was the reason he was laid off.”

Sweet had to have known Kerr wasn’t making a mere “allegation,” since many of LHH’s physicians knew of the problems with the patient gift fund. The major story that Sweet completely elided from her memoir and which she had to have known of, was that everyone — including doctors on LHH’s medical service — knew Kerr was being eliminated in an act of retaliation.

In fact, the timeline shows that Kerr and Rivero submitted their patient gift fund whistleblower complaint to the Ethics Commission at 12:02 p.m. on March 4, 2010, which was promptly faxed to San Francisco’s District Attorney. Two hours later, Dr. Riley confirmed during a Medical Staff meeting that the only planned physician cut was a previously announced cut of a half-time position that wasn’t Dr. Kerr’s position.

But three-and-a-half hours later on the same day, March 4, Kerr’s Union (the Union of American Physicians and Dentists) was informed by LHH’s H.R. department that Kerr would be receiving a permanent layoff notice. Kerr was orally notified of his layoff on Monday, March 8 and was handed the printed layoff notice that was signed on Friday, March 5. It was ten days later — not one day later under Sweet’s misuse of literary license — when Kerr filed a Whistleblower Retaliation Complaint (not a lawsuit) with San Francisco’s Ethics Commission. Sweet should also have known that it was fully eight months later, on November 16, 2010, when Kerr filed his wrongful termination lawsuit in Superior Court, not the day after receiving his layoff notice, as she deliberately misreported.

Lightning Strikes Twice

The wrongful termination of Kerr in 2010 follows on the heels of Laguna Honda Hospital’s wrongful termination of Dr. John Ulrich, Jr. in 1998. Ulrich — who had also spoken up in 1998 about patient care during a Laguna Honda medical staff meeting and called the health department’s decision to cut two medical staff positions “an injustice to patients” — was summarily terminated by Laguna Honda Hospital, just as was Dr. Kerr. Ulrich was forced to sue the City, after the state medical board had cleared him of any medical wrongdoing and found no problems with Ulrich’s care of patients.

Ulrich, whose case had advanced to jury trial, won a $4.3 million judgment in federal court in 2004, subsequently reduced to a $1.5 million negotiated settlement. As the Pittsburgh Post-Gazette newspaper reported in its June 24, 2004 issue, a U.S. District Court of Northern California jury concluded that LHH “had violated Ulrich’s first amendment rights to free speech, and denied him a fair hearing to clear his name.”

Strikingly, the then San Francisco City Attorney spokesperson, Matt Dorsey, claimed in 2004 that Ulrich’s dismissal was “not an instance of reprisal.” Dorsey went on to claim there was “not a shred of credible evidence to indicate wrongdoing on the part of the City.” Dorsey foamed, “We consider this outcome [Ulrich’s award] an aberration.”

A decade later, Dorsey is still the City Attorney’s spokesperson. Given Kerr’s settlement, it’s clear Dorsey may be unable to distinguish an aberration from a clear pattern.

Given Kerr’s precedent-setting settlement award, it’s also clear there is a past- and current-practice pattern documenting that LHH’s senior management engages in wrongful termination and willful retaliation against employees who exercise their First Amendment rights to free speech.

The pattern isn’t limited to just Laguna Honda Hospital; it happens all too frequently in many City departments.

The Costs of 100% Retaliation

The Ethics Commission did nothing to protect Kerr’s career after he submitted his patient gift fund whistleblower complaint with Dr. Rivero. Instead, he was told to get a lawyer, and Ethics took two years to complete investigating Kerr’s complaint.

“In retrospect, a lawsuit was our only hope, because Ethics hasn’t sustained a single whistleblower retaliation claim since it was founded, not one,” Kerr laments. “Many studies show that reprisals against whistleblowers are common, with retaliation rates up to 90%. But with San Francisco’s Ethics Commission, the retaliation rate is always zero,” Kerr says.

Kerr was referring to the fact that in November 2012 the City Attorney’s Office reported that between 2007 and 2012, the City settled 103 cases involving prohibited personnel practices for a total of $11 million, including wrongful, retaliatory termination; racial-, age-, and disability-discrimination; sexual harassment; and other prohibited personnel practices.

Despite the City Attorney having concluded that at least 13 wrongful termination settlement cases have cost the City $1.3 million since 2007, San Francisco’s Ethics Commission has dismissed every whistleblower retaliation complaint filed at Ethics. Ethics has “dismissed” at least 18 cases alleging prohibited retaliation, for a 100% “clearance” rate, hoping to suggest there is zero retaliation against City employees. Studies show that nationwide, retaliation against whistleblowers is common, with rates up to 90%.

Only in San Francisco would our Ethics Commission dismiss every retaliation complaint received, claiming that zero retaliation ever occurred. Despite Ethics’ nonsense that there have been zero retaliation cases, it appears that, in fact, San Francisco may well have a 100% retaliation rate.

Prominent San Francisco open government, public-interest, and accountability advocate James Chaffee — who was an inaugural member of San Francisco’s Sunshine Ordinance Task Force serving as its first Vice Chair, and is now affiliated with San Francisco’s ad hoc Sunshine Posse — wrote to the Board of Supervisors on March 30, 2013, noting “Dr. Kerr’s case has many themes that reverberate throughout City Hall — the influence of private money; the misapplication of purpose of the money; the automatic defense of incompetent administrators; and, most of all, the acceptance of corruption as ‘business as usual,’ all the way to the top.”

Drs. Kerr and Rivero, for their part, hope some public benefit will come from the delayed justice they have endured.

As William Bennett Turner, a faculty member who teaches courses on the First Amendment at U.C. Berkeley noted in his book “Figures of Speech: First Amendment Heroes and Villains” published last year, First Amendment heroes are those who say what they believe, and have the courage to face the consequences.

Villains — such as the defendants in Kerr’s lawsuit — are those who want to suppress free speech that they disagree with.

Kerr and Rivero accidentally became First Amendment heroes. We owe them a debt of gratitude for risking their careers exposing fraud and corruption, and for advocating on behalf of LHH’s patients, who are often the poorest of the poor.

Kerr’s monetary and non-monetary settlement awards don’t begin to adequately reimburse him for the damage to his and Rivero’s careers. But there’s a vast community grateful for his and Rivero’s courage to speak out.

Monette-Shaw is an open-government accountability advocate, a patient advocate, and a member of California’s First Amendment Coalition. Feedback: monette-shaw@westsideobserver.com.

Postscript: The City and LHH’s CEO, Mivic Hirose, Still Don’t Get It

On March 26, 2013 — at the same hour that the Board of Supervisors voted to approve Kerr’s monetary and non-monetary settlement terms — Drs. Kerr and Rivero, and this reporter, instead attended a meeting of the LHH-JCC (Joint Conference Committee), consisting of three Health Commissioners and LHH’s senior leadership, which meets every other month.

Following Hirose’s customary Executive Administrator’s report, the JCC took public comment. Kerr, for his part, testified that bullying and getting rid of whistleblowers is both counter-productive and illegal. As he began to testify that his retaliation settlement agreement requires that LHH’s Executive Committee be provided a one-hour training on employee’s whistleblowing and First Amendment rights — which training Kerr feels should be expanded to all LHH senior managers — Hirose began to openly smirk, just seconds after I took this photo.

I blurted, quite out of order, “There’s nothing funny about this Mivic, why are you smirking?” She quickly wiped the smirk off of her face, glaring at me, obviously not contrite. Hirose clearly doesn’t get it, or seem to understand the gravity of the $750,000 settlement plus the City Attorney’s hefty legal fees spent defending the pretext that Hirose, Katz, and Riley were was innocent of retaliatory termination. Maybe she thinks money grows on trees in LHH’s new orchard.

Next, Dr. Rivero testified on March 26 that a recent Coalition on Compassionate Care award to LHH’s Hospice and Palliative Care Service tells a different story than Hirose’s and LHH’s new press release. Rivero noted that the award honors 25 years of hospice care, which couldn’t have happened without Kerr’s 21 years as Hospice physician. Rivero testified that it is shameless self-promotion to aggrandize LHH and Anne Hughes, RN, by ignoring the founder of the hospice program, Dr. Kerr.

Later, I testified that the City’s and Defendant’s defense pretext that Hirose was innocent is over, or Kerr’s settlement deal would never have been reached. Hirose has clearly cost taxpayers over $1 million — at minimum — between Kerr’s $750,000 settlement and the $350,000 ordered restored to LHH’s patient gift fund.

I testified that the Health Commission should recommend that DPH terminate Hirose at once, the sham of her “I’m innocent!” pretext being over.

But there were just more smirks and blank stares all around the table.

As Mr. Chaffee has noted, the acceptance of corruption as “business as usual, all the way to the top,” is what runs San Francisco’s so-called “City Family.” Just ask the current mayor. Or our former mayor, Willie Brown, who both probably view the $11 million in prohibited personnel actions and wrongful termination settlements awarded during their tenures as mayor— and the ensuing damage to the careers of innocent employees — to just be a cost of doing corrupt business-as-usual. Between corrupt friends, perhaps $11 million is considered chump change.

April 2013

The High Cost of City Government

Voracious Management Salaries Rob the City’s Lowest-Paid Workers

Even while skyrocketing salaries for upper management in San Francisco City government now costs $1.6 billion, excluding fringe benefits, the City has proposed imposing a “reverse pay equity” (pay cut) for 45 lower-paid job classification codes for new hires, creating a two-tiered salary structure for performing the same work.

Bloated salaries for San Francisco’s top City managers contribute significantly to the purported $4.4 billion in so-called unfunded City pension contributions, since City salaries drive pensions paid out.

Warning: Taxpayers who want to know what our local government is up to with our tax dollars, extensive salary data is presented ahead, which clearly shows City Hall's penchant for robbing from the lowest-paid in order to feed the voracious appetite of upper-management salaries. It's a story of robbing form the poorest to feed the already reich.”

Inequities in salaries of City employees deserve a close look-see, since nearly one-quarter — 7,327 — of all City employees are half-time or less, employees who averaged just $12,492 in annual base pay in FY 10-11. Fully 32 percent — 11,783 City employees — earned less than $50,000 in base pay in calendar year 2012, averaging just $22,491 in total pay.chart of salaries

Contrast that to the glut of City staff who in calendar year 2012 earned over $100,000 in base pay — 7,864 such employees, or 21.6 percent — who averaged $124,715 in base pay and averaged a staggering $143,131 in total pay. Or contrast it to the 12,309 employees — 33.5% — who earned over $90,000 in total pay in calendar year 2012, averaging $110,473 in regular pay and $129,622 in total pay.

Given the salary inequities between the lowest- and highest-paid City employees, the stench of probable political patronage using taxpayer funds begins to waft through the air.

Chops to the Lowest Paid

The City has proposed trimming 10% from new-hire salaries for payroll and personnel clerks, certified nursing assistants, and hospital eligibility workers, claiming they are overpaid compared to the Bay Area market. The City also proposes a seven-and-a-half percent pay cut for psychiatric technicians, child support officers, legal process clerks, legal secretaries, psychiatric social workers, and museum guards. The City also wants its pharmacists, custodians/porters, medical social workers, various health care workers, employment and training specialists, and diagnostic imaging technicians to take five percent new-hire pay cuts.

At the same time, the City is not proposing pay cuts from the 722 senior managers earning more than $90,000 in base pay in the 0900-series of management job classifications, who averaged $136,242 in base pay.

Between calendar years 2008 and 2012, the City has already eliminated 734 positions across the 45 job classifications the City now proposes to cut salaries of, pocketing $20 million to $30 million in base pay from the lost 734 positions, and probably transferring the duties to higher-paid employees. Should its new pay cut proposal prevail for the 45 job classifications, the City may realize approximately $13.7 million in additional “salary savings” — albeit, spread across several decades — through attrition and replacement with new hires who will be paid at the lower salaries.

At the end of June 2011, the 3,864 employees remaining in these 45 job classifications earned average base-pay salary of just $49,061. Of the 3,864 remaining, fully 18%, nearly one-fifth, worked less than half-time status, averaging salaries of just $12,389. Only 49.5 percent of employees in these job codes worked full-time, at an average salary of $60,913. The City will likely convert many of the new hires in these job classifications to part-time status, and extract pay cuts of up to ten percent from half-time employees who are already averaging just $12,389 in base pay.

This follows on the heels of “de-skilling” of clerical and secretarial employees in the 1440-series, who forfeited 452 positions between calendar years 2008 and 2012, allowing the City to pocket another $13.4 million in salaries. “De-skilling” involves assigning the work of higher job classification clerical employees to lower-paid clerical staff — or alternatively, of handing the work of skilled clerical employees to highly-paid management staff, where the work is performed for much higher pay, if at all.

In FY 2010-11, the City’s 1,600 clerical employees in the 1400-series job classification codes averaged just $42,026 in base pay, but the sad fact is that of those 1,600 clerical employees, 21 percent worked less than half-time and averaged just $7,970 in base pay.

Combining the 452 clerical positions eliminated between calendar years 2008 and 2012, and the 734 positions already eliminated from the 45 job classification codes, the City has eliminated at least 1,186 lower-paid and part-time positions, pocketing between $33 million and $50 million, which the City then used to increase the number of, and salaries of, highly-paid managers.

Much of the work formerly performed by clerical workers has been given to far-higher-paid managers, although the City has attempted to hire so-called “as needed” public service aides to fill the gap. Knowledgeable and experienced clerical workers are being replaced by aides.

In the three-year period between FY 08-09 and FY 10-11, the City added 587 part-time public service aides in the 9900-series job classifications to replace the 452 clerical employees eliminated in the 1440-series, bringing the total number of public service aides to 1,309, of whom 1,211, 92.5 percent — work less than half-time (so the City doesn’t have to pay them any fringe benefits), and who averaged just $4,590 (yes, less than $5,000 each, on average) during FY 10-11.

The City has also forced many of the higher-skilled secretaries formerly in the 1440-series into the lower-paid 1406 Senior Clerk classification. During the same time period of the public service aide hiring binge, the City added 106 additional 1406 Senior Clerks, who now average just $43,665 in base pay; 12.4 percent of the now 201 Senior Clerks work less than half time, averaging just $10,543 in base pay annually.

Another example, to be clear, of the part-time direction the City is headed in, is that 494, 21.2 %, of 2,330 Muni drivers earned average salaries in FY 10-11 of just $11,030, having worked less than 1,040 hours, which is half-time, or 0.5 FTE (“full-time equivalent”) status.

Across all job classification codes in FY 10-11, fully 21.3 percent, 7,327 City employees, were half-time (or less), averaging just $12,492 annually in base pay. They stand in stark contrast to the 7,864, or 21.6 percent, of employees who earned over $100,000 in base pay and averaged $143,131 in total pay.

Excesses for the Highest Paid

After former Supervisor Tom Ammiano first noted in 2003 that City managers earning over $90,000 were a problem, voracious management salaries have climbed steadily upward for over a decade. Indeed, on February 20, Matier and Ross lamented in the San Francisco Chronicle that the days when it was news that a handful of City managers were earning $100,000-plus salaries were long gone — now such highly-compensated employees has somehow become acceptable.

Matier and Ross reported that approximately 572 San Francisco city employees are paid more than Governor Jerry Brown’s $173,987. Indeed, San Francisco does have 379 City employees who were paid more in base pay in 2012 than the governor earned; those 379 averaged an astounding $193,415 in base pay each, sucking out a combined $78.6 million in total pay from the City’s payroll. They also reported that 195 City employees made more than $200,000, and that one quarter of City employees make more than $100,000 without overtime.

Across the decade since 2003, the City has added another 553 managers in the 0900-series job classification codes, bringing the total to 722 of such managers in 2012. Of the 722 managers, we have 570 in the 0922 to 0943 manager series (up to Manager VII), and another 131 Deputy Directors of Departments and Department Heads (Deputy Directors I through V and Department Heads I through V) in the 0951 to 0965 series, even though the City’s core business has not changed sufficiently in the past decade to warrant the hiring of 533 more managers in these job classifications. This single increase costs taxpayers an additional $82.4 million annually, and now costs at least $101.5 million in base salary alone for the 722 incumbent senior managers.

Why does San Francisco need at least 722 senior managers — or more, since there are many other job classification codes that include the word “manager” in their job titles — to run just (approximately) 60 City departments?

Matier and Ross failed to note that in the five years between 2007 and 2012, the City felt the need to add an additional 1,461 employees earning over $150,000 in total pay, at an increased cost of $269.3 million. The City now has 2,777 employees earning over $150,000 annually in total pay, at a combined cost of $496.1 million.

While City Hall turns a blind eye towards the City’s $4.4 billion in purported unfunded pension contributions, it is simultaneously turning a blind eye to the ever-escalating unfunded liability of salaries for top City managers who apparently feel an entitlement to excessive salaries. Their top salaries drive top pensions, just as night follows day.

Until taxpayers say enough is enough, expect these City managers to keep earning far more than our State governor, the president of the United States, and private sector CEO’s, while the City’s lowest-paid workers are robbed of their jobs, or face drastic pay cuts.

Monette-Shaw is an open-government accountability advocate, a patient advocate, and a member of California’s First Amendment Coalition. Feedback: monette-shaw@westsideobserver.com

March 2013

Laguna Honda’s Continuing Scandals

Laguna Honda HospitalA Sordid Tale of Two Non-Profits

The recent sordid history of two non-profits that purport to serve residents of Laguna Honda Hospital (LHH) appears to have resulted in the dissolution of one of the non-profits, declining contributions to the hospital from the other, and an eight-year low in public contributions to Laguna Honda Hospital’s patient gift fund.

“We were so shocked at being driven out of Laguna Honda, right after reporting irregularities with the Patient Gift Fund in 2010, that we figured we had touched on major violations that Laguna Honda and the Department of Public Health were desperate to hide,” former Laguna Honda Hospital physicians Dr. Maria Rivero and Dr. Derek Kerr said.”

All of this may have been avoidable. But a confluence of factors appears to have contributed to unintended consequences for all three programs. Former City Attorney Louise Renne’s unfortunate statements in June 2004 may have set the stage for their downward trajectory.

Renne—who claims that she was responsible for the ground-breaking lawsuit against tobacco companies that provided much of the rebuild funds, when it was former Supervisor Angela Alioto who accomplished that feat—and though she failed to raise a single dime towards new furnishings for the rebuilt hospital, Renne was awarded an engraved plaque in Laguna Honda’s new facilities.

Renne appears to be finally throwing in the towel, and is reportedly dissolving her foundation following an apparent investigation by the Registry of Charitable Trusts, a division of California’s Attorney General.chart showing donations

RIP Laguna Honda Foundation

In response to a fairly innocuous “show us the money” request placed on January 13 by this Observer columnist for audited financial statements of Ms. Renne’s Foundation, Melanie Beene, CEO and President of Community Initiatives—the “fiscal sponsor” handling the books of Renne’s non-profit Foundation—responded unexpectedly on January 14, that Renne’s foundation is no longer a sponsored project of Community Initiatives.

This loss means Renne can no longer shield her Foundation’s revenues and expenses by aggregating them under lump-sum reporting by Community Initiatives to the IRS. She has lost her IRS cover.

Beene also volunteered that, to the best of her knowledge, the Foundation is dissolving.

By mid-week, a source who spoke on condition of anonymity reported that the Attorney General’s office—presumably the A.G.’s Registry of Charitable Trusts that oversees operations of non-profits in California had either investigated or audited the Foundation.

The source further reported that Renne’s Foundation may have had to return a $50,000 grant to one of its donors, and may have expended the last of the foundation’s funds responding to the A.G.’s investigation. The A.G. noted that it is highly improper and very unusual business practice for a foundation that has received independent non-profit, public-benefit corporation status from the IRS—as Renne’s Foundation has—to also operate as a so-called “project” of fiscal-sponsor entities such as Community Initiatives.

By January 18, not only had Laguna Honda Hospital removed from its web site its previous philanthropy web page link to the foundation, Attorney General investigators also reported they would neither confirm nor deny any investigation.

“We were so shocked at being driven out of Laguna Honda, right after reporting irregularities with the Patient Gift Fund in 2010, that we figured we had touched on major violations that Laguna Honda and the Department of Public Health were desperate to hide,” former Laguna Honda Hospital physicians Dr. Maria Rivero and Dr. Derek Kerr said.

“So we reported our findings about the patient Gift Fund; Volunteers, Inc., and the Laguna Honda Foundation to the Attorney General’s Registry of Charitable Trusts, the U.S. Attorney’s Tax Division, and the IRS. Had we not been ‘laid-off’ and harassed, we would have reported solely to the City’s Whistleblower Program,” the two doctors disclosed. The Attorney General’s office apparently followed up on their ethical concerns.

Dissolution the Foundation appears to be delayed fallout from the scandal involving Laguna Honda Hospital’s raid of its patient gift fund in order to fund staff amenities, set in motion by previous Executive Administrator, John Kanaley, who died in 2009. The gift fund was eventually restored some $350,000, following a long-delayed audit by the Controller.Laguna Honda entrance

Gift Fund Donations Plummet Again

The “Annual Report of Gifts Received,” issued by the Department of Public Health’s CFO, shows that in Fiscal Year 2011-2012 ending in June 2012, private giving to Laguna Honda’s patient gift fund dropped to just $7,042, excluding a one-time $20,000 donation from Safeway, Inc. for a nutrition project in the hospital.

That $7,042 represents the lowest level of private contributions to the patient gift fund since FY 2006-2007, when donations to the gift fund were 14 times higher, at $97,915. Even going back to FY 2004-2005, the year after the Foundation’s formation, donations to the gift fund were ten times higher, at $77,003.

Of interest, donations to the patient gift fund took a drastic “fiscal cliff” fall between Fiscal Years 2006–2007 and 2007–2008, plummeting from $97,915 to just $28,656, the year after Renne installed, former Deputy City Attorney Marc Slavin, as Laguna Honda’s Director of Communications in 2007.

Slavin’s abrasiveness with members of the public may have contributed to the decline in donations to the patient gift fund.

Volunteers, Inc. Support Dries Up

Since 1957, Laguna Honda’s Volunteers, Inc. has financially supported both the patients at Laguna Honda, and its cadre of volunteers. In March 2012, Volunteers, Inc. re-branded itself, changing its name to “Friends of Laguna Honda.” It also decamped from Laguna Honda Hospital, and moved its offices from 90 New Montgomery to an address in Mountain View, after its former president Joseph Lehrer stepped down.

As the graph of data from the Health Department shows, donations from Volunteers, Inc. to Laguna Honda and its Volunteer’s Department have declined in the past five fiscal years, dropping by half—from $91,292 in FY 2006-2007, to just $46,294 in FY 2011-2012. But the CFO’s data only shows part of the story.

Turning to Volunteers, Inc.’s Form 990 tax returns from calendar year 2010 to calendar year 2011, grants awarded by Volunteers, Inc. to Laguna Honda for patient recreation and other services (including bus trips off campus) plunged from $171,261 in 2010 to just $20,018 in 2011 (albeit, the $20,018 grant more than likely came from Safeway, and may have been misreported by DPH’s CFO as a donation to the patient gift fund).

The $151,243 outright reduction in Volunteer, Inc.’s grants to Laguna Honda also tells only part of the story. Overall, Volunteers, Inc. reports on its tax returns that it had spent $394,250 on patient amenities, recreation, refreshments, and other “program services” to hospital residents in 2010, but cut that amount to $179,731 in 2011, a net loss of $214,519 in various services to patients.

In 2011, the $179,731 in program services for residents translates to 49.4% of Volunteers, Inc.’s total expenses of $363,932, down from 56.9% spent on program services from its total expense spending in 2009. The remainder in both years was eaten up by fundraising and management-and-general expense categories.

Charity watchdog groups, such as GuideStar.org and Charity Navigator, suggest that the standard benchmark for non-profits is to spend at least 70% of their total expenses on “program services” to serve actual beneficiaries. Volunteers, Inc.’s spending of just 49.4% on program services in 2011 fell short.

Although Volunteers, Inc. awarded $14,990 to LHH’s Volunteer Services in 2010, its tax return shows that it eliminated any financial support whatsoever to the Volunteer Services Department in 2011, in addition to the $151,243 grant reduction for patient amenities.

Between curtailing support to patients and completely eliminating support to actual volunteers of the hospital, Volunteers, Inc. cut its total spending on program services by $230,000 across a single calendar year. Across the same period, its tax returns show Volunteers, Inc. tripled its spending on public relations, from $11,072 to $33,693.

Who Does PR Slavin Work For?

Renne hand-picked Marc Slavin who had been her public information officer when she was the City Attorney.

Slavin informed this author shortly thereafter that his job was to “stop the negative publicity.” He never clarified whether it was to stop negative publicity for Renne’s Foundation, or for the Department of Public Health (DPH), which never had a PR officer assigned to LHH for 100+ years until Slavin’s arrival.

Between his base salary and fringe benefits, Slavin has cost taxpayers over $950,000 in six short years. His assistant, Linda Acosta, adds another $500,000 in salaries and benefits. Between them, $1.5 million in taxpayer funds may have gone up in P.R. smoke and mirrors.

Slavin, of course, is the P.R. wizard who told the I-Team’s investigative reporter Dan Noyes that LHH’s “patient gift fund isn’t for patients.” His propaganda campaign continues.

Magical Commingling of Funds

The unholy commingling of private and public sector funds began when Volunteers, Inc. awarded $375,000 to hire staff for Renne’s new Foundation in 2003. This was an expense completely unrelated to the exempt purposes for which the IRS awarded non-profit status to it.

As the Observer has reported in “A Foundation’s Dirty Laundry” (Dec ‘12), the commingling of public and private funds between the City, the Foundation and Volunteers, Inc., has never been audited, adequately or otherwise.

In addition to the $1.5 million in salaries and benefits funded by SF’s general fund for Slavin and Acosta to perform liaison work for Renne’s Foundation across the past six years, the City has provided free office space in Suite A-150 to house Renne’s Foundation, replete with janitorial services supplied by City employee staff, and free utilities.

Shooting Herself in the Foot

Renne published a guest opinion piece in the San Francisco Chronicle (“Laguna Honda needs more than what bonds provide” (6/3/04), claiming that the driving purpose governing formation of her Foundation was to raise private-sector funds for furniture, fixtures, and equipment for the new LHH. But by claiming that “regardless of the [patient] population mix receiving services at Laguna Honda—a policy decision in the hands of the city’s director of public health”—her Foundation had been established to meet the immediate needs of residents and other users. And she claimed the new LHH would move LHH “from a traditional medical model to a social residential model of care.”

Renne’s phrase “regardless of the patient population mix,” may have unwittingly sent the message that displacing the frail elderly and disabled that Laguna Honda had traditionally served was OK, and that using the hospital for psychosocial mental health rehabilitation, instead, was acceptable and a decision best left to then-Director of Public Health Katz.

That op-ed may have directly led to a drop in donations to LHH’s patient gift fund, and may have effectively killed any chance to attract donors. After all, Renne announced a major shift in the hospital’s mission that may have chilled philanthropic donors. Charitable donations to the elderly are one thing; but “psychosocial rehabilitation” has a much smaller universe of donors.

Ms. Renne Fails to Respond

Ms. Renne was offered an opportunity to confirm or deny whether she is, in fact, dissolving her foundation, and if not, what her plans may be, but failed to respond by press time. She appears to have chosen to withhold information again, just as she has from the IRS, the Health Commission, and the charity-donating public, any and all details concerning her foundation’s revenue and expenses.

SF’s Health Commission still has work to do: it should fully audit the commingling of funds at LHH and unplug its PR division .

The Health Commission has an ethical responsibility to formally notify Renne that the Commission expects any funds and all assets remaining in the foundation upon dissolution be donated only to Volunteers, Inc., or to LHH’s patient gift fund, for direct patient benefit.

Renne shouldn’t be let off the accountability hook quite so easily.

Monette-Shaw is an open-government accountability advocate, a patient advocate, and a member of California’s First Amendment Coalition. Feedback: monette-shaw@westsideobserver.com.

February 2013

Laguna Honda Foundation

A Foundation’s Dirty Laundry

Additional planning for use of Laguna Honda Hospital is again being discussed without input from the public — and probably without input from the hospital’s own patients — including outsourcing of Laguna Honda’s Gerald Simon patient auditorium, the on-going lack of a patient gift shop, and conversion of Laguna Honda’s old buildings into assisted living housing units.

(Photo: Louise Renne and Foundation’s Board of Directors VP Derek Parker at SF Health Commission Meeting)

To no one’s surprise, former City Attorney Louise Renne’s “nonprofit,” the Laguna Honda Foundation, which has no formal written agreement with the City, is embroiled in the discussions, and some complain that she’s being both secretive and disingenuous. Although Renne appears to have been planning the outsourcing of the patient auditorium for over a year and a half, her plans only became public on March 6, when her Foundation was hauled in front of SF Health Commission to provide an update of her Foundation’s activities and finances.

The Health Commission has tried repeatedly across the years to obtain the Laguna Honda Foundation’s financial data but they’ve been repeatedly rebuffed by Renne, who stridently refuses to cooperate.”

The Recalcitrant Foundation

Ever since Renne formed her Foundation in 2004 — without a written memorandum of understanding (MOU) with either the City or Laguna Honda Hospital — the Health Commission has been worried about the lack of reporting concerning the Foundation’s finances. As previously reported, when the City agreed to a preliminary $25 million settlement with Ms. Renne for furniture, fixtures, and equipment for the new Laguna Honda facilities, the Health Commission publicly fretted about how it would recover that planned settlement.

Since that time, there has been extensive coverage about the failure of Renne’s Foundation to disclose either its income and expenses, or the three categories of spending the IRS requires non-profits report on Form 990’s: Fundraising, Management and General, and Program Services spent on actual services. The three categories are used to evaluate the financial accountability of non-profits. All of the Foundation’s Form 990’s submitted to date to the IRS have reported zero income and zero expenses, even though it has been reported in the media that Renne’s Foundation has earned at least $766,531 since its incorporation eight years ago. But she’s never provided detailed tax returns itemizing how much she has raked in, and what she’s spending it on.

The Health Commission has tried repeatedly across the years to obtain the Laguna Honda Foundation’s financial data but they’ve been repeatedly rebuffed by Renne, who stridently refuses to cooperate.

The Artful Dodger’s Testimony

In preparation for a December 14, 2011 meeting with then Health Commission president Steven Tierney and its then vice president, Sonia Melara, Ms. Renne submitted a letter to the Health Commission dated December 8, in which she outlined her Foundation’s activities since it was incorporated.

True to form, Renne claimed in a footnote that her Foundation had difficulty raising funds because “two hospital physicians and others then employed at the hospital made public assertions that the hospital was unable to safely accommodate the flow of patients from San Francisco General Hospital.” Renne has been unable to admit that the damage to the hospital’s reputation was not done by the two physicians she wrongly accuses; instead, perhaps the damage to the hospital’s reputation was done by former Director of Public Health, Mitch Katz, whose notorious “flow project” made patient safety at the hospital a major issue.

Apparently resulting from Tierney’s December 14 meeting with Renne, the Health Commission placed an agenda item about Renne’s Foundation onto its March 6, 2012 meeting agenda. During the March 6 meeting, Renne presented orally much of the flawed testimony in her December 8 letter.

When she testified that she set up her Foundation “right after Proposition A” was passed by the voters in 1999, she was stretching the truth; her Foundation wasn’t incorporated until almost five years later, in 2004. She claimed her Foundation had funded something related to lift apparatus to transfer patients safely into bath tubs, but she didn’t say how much was donated, when, or for what items. When she testified that her Foundation had funded working with the Center for Health and Design, she claimed it was among gifts to the City and hospital.

Derek Parker, Vice President of the Board of Directors of Renne’s Foundation, accompanied her to this hearing. Parker co-founded the Center for Health Design, known for its Pebble Projects, a theory that “evidence-based design” can contribute to measurable improvements in patient outcomes. Parker has served in various roles at Anshen + Allen, the architects who designed Laguna Honda’s new facilities, including as a principal, as its former CEO, as a member of its Board of Directors, and as its Director Emeritus.

Renne forgot to note her Foundation’s funding to the Center for Health Design benefited an entity Parker co-founded and was a board member of, while simultaneously serving on her Foundation’s board. She also failed to note that the City filed a lawsuit against Anshen + Allen, Stantec Architecture (which acquired Anshen + Allen), and other entities in December 2011, seeking recovery of damages for breach of contract, professional negligence, indemnity, and other declaratory relief involving the dispute that arose from the design and construction of the Laguna Honda Replacement Project. The lawsuit involves over $70 million in design errors.

When she testified that her Foundation had helped provide money for training and consultants, she failed to mention the hospital already had a $10 million “transition budget” supplemental stash from the general fund for that purpose. She claimed her Foundation had helped fund the hospital’s opening festivities and ribbon cutting ceremony, but again, the City had a separate budget line-item for that. She claimed her Foundation had made a grant to Laguna Honda to help pay for a gardener. She asserted, “All of the money that we spend is requested by the Hospital or the City. And if the Hospital makes a request, it goes through them.”

She claimed that her Foundation had made several gifts and grants to the City, often directly to the hospital. She went so far as to say, “Any money that we spend at Laguna Honda certainly is a matter of public record,” but that’s pure hubris, since there are no public records concerning her Foundation’s expenditures. Renne isn’t likely to make any records available, anytime soon.

Poor Health Commissioner Jim Illig; he took Renne’s bait, and pressed her. Illig noted that the Health Commission has a Charter responsibility to obtain an annual report of gifts and grants to public health entities from each agency affiliated with the Health Department. He noted that the Public Health Foundation, Friends of Laguna Honda (formerly Laguna Honda Volunteers, Inc.), and the San Francisco General Hospital Foundation all comply with this Charter requirement, and each entity provides their revenues and expenses to the Health Commission.

Perhaps to his downfall, Illig pressed harder, contradicting Renne publicly by saying, “We have no record of grants [from your Foundation] that have come to Laguna Honda, because it would have been reported to us, as the Health Commission.” [Editor’s note: Nine days later on March 15, the Mayor declined to re-appoint both Commissioners Illig and Tierney, who were both hold-over appointments. The timing between Renne’s forced appearance before the Health Commission and the abrupt removal of the two Commissioners who had pushed for the hearing into her finances is obviously problematic.]

Indeed, four subsequent public records requests — to the Health Commission, to the City Controller’s office, to Laguna Honda Hospital itself, and to the Department of Public Health — for any “accept-and-expend” resolutions documenting specific Laguna Honda Foundation gifts and grants to the City between 2003 and today’s date each yielded the same four responses: There were no responsive records from any of the four City agencies. Illig had been correct: The City has absolutely no record of any gifts or grants to any City agency made by Renne’s Foundation since its inception, despite her testimony to the contrary.

The “No Public Money” and “Anonymity” Canards

Ms. Renne appears to be confused about the source of funds to her non-profit organization. On March 6, she stated, “All — all! — of our contributions come from private individuals. And consequently, there is no public money.” What Ms. Renne may not understand is that the key litmus test to obtain IRS non-profit designation is what percentage of contributions is considered “public support.” Private donations to any non-profit foundation are public funds donated to advance a charitable public purpose, and those contributions typically come from members of the public. All funds donated become “public money,” entrusted to fiduciary stewards of the non-profit.

What Renne is confounding is that only “sometimes” — by her own admission — her Foundation receives money from donors who wish to remain anonymous. This is a complete canard, since IRS rules already permit withholding of the names of individual donors for confidentiality reasons. This is no reason for Renne to completely withhold reporting her total revenues in their entirety, simply to provide donor confidentiality.

There are IRS protections already in place to ensure full financial disclosure, without disclosing donor names. Can’t the Health Commission see that Renne is hiding behind donor disclosure concerns, to deliberately avoid full financial disclosure?

And what of Renne’s claim that her Foundation has been falsely accused of taking tobacco settlement revenues? To our knowledge nobody has raised such an accusation, except Renne herself.

Outsourcing the Patients’ Auditorium

Without the Health Commission’s March 6 hearing on the Laguna Honda Foundation’s status, Ms. Renne’s plans to outsource operations of Laguna Honda’s patient auditorium would still be in the dark.

Named in 1963 for local businessman Gerald Simon, who founded Laguna Honda Volunteers, Inc. in 1957 to raise funds for the hospital’s patients, the patients’ auditorium has long been a focal point of hospital activities. During the decade between May 1999 and November 2009, patient activities were expertly conducted by the nearly 40 activity therapists employed by the hospital, each of whom had advanced specialized training in therapeutic activities. (Laguna Honda’s activity therapists have a broad range of specialties, from art therapy to dance therapy and everything in between, and are skilled at cognitive stimulation of frail elderly patients.)

After over 50 years of conducting programs in the patient theater, including hosting Bing Crosby concerts, suddenly last March 6 Renne alleged, “…the [Laguna Honda] staff there is so busy that there’s no way they can run the theater, I just don’t think it’s humanly possible.” Then we learned that sometime in the spring of 2011, Renne’s Foundation contracted with AECOM to assess operations of Gerald Simon Auditorium. By July 2011, AECOM had issued its draft report prepared for the Laguna Honda Foundation, entitled “Demand Assessment for Gerald Simon Theater.”

The assessment claims that Gerald Simon auditorium needs to be “re-branded” as distinct from the hospital itself, probably with a new name to convey it’s a community theater, not exclusively for patients. After 50 years of operations, suddenly Mr. Simon’s good name on the auditorium isn’t good enough for Renne or the hospital.

The assessment analyzed the demand for various types of activities that community organizations may hold to rent Gerald Simon Theater, and what type of management model would be appropriate. In order to raise an estimated $176,000 annually to run the theater — $107,000 of which represents new management salaries for staff in addition to existing hospital employees — various cost factors are assessed.

It’s clear Renne is seeking a dedicated funding stream for her Foundation.

The report notes that resident use of the auditorium will be of concern when scheduling rental events. The report is very vague on what will be done to accommodate residents in the hospital’s chapel that is being constructed next to the auditorium, or whether worship services would have to be moved elsewhere in the hospital when there are scheduling conflicts. The report notes caution will be needed to prevent displacing resident activities, but mentions nothing about what may happen to long-scheduled resident activities in the event urgent or lucrative community events might require bumping resident activities in order to meet monthly theater rental quotas.

The report notes that the 600 parking spots on Laguna Honda’s campus will be of significant interest to planners considering holding potential events at Laguna Honda, but the report does not mention where LHH’s staff, who each pay $75 monthly or more for on-campus parking, will park their cars on days when rental events might require them to give up their parking spaces. The report notes that another “plus” is the hospital’s new Café Kitchen on the second floor that could be creatively scheduled for use as a private event catering kitchen. But again, the report does not discuss how use of the kitchen for private events might adversely impact preparation of routine meals for patients.

The report notes that there are $360,000 to $700,000 in required, or highly-desired, construction improvements to the theater to attract rental tenants, costs which are not included in the hospital’s replacement project budget, nor are funding sources identified in the Demand Assessment.

Shouldn’t those construction improvements have been included in the design of the hospital when construction plans were drawn up a decade ago? Why are design changes needed now, two years after moving into the new facilities? Shouldn’t a demand assessment for the theater have been conducted before construction began in 2003?

It’s unknown whether Laguna Honda has told its Residents Council of Renne’s plan to take over operations of its patient auditorium. Should the auditorium rent out for an entire month, patients may not have access to their auditorium and its adjoining chapel?

Notably, the report indicates that in order to generate about $156,000 in annual revenue, a community theater at Laguna Honda would have to hold approximately 12 events each month. But the report does not address what funding source will be tapped to cover theater operating expenses in the event that rental income is insufficient to pay the bills. For example, if only 6 rental events are held in a month when 12 were projected, who will be on the hook to cover the shortfall in revenue? Will the City’s General Fund be tapped to make up any operating losses from outsourcing operations of the theater? When rental income is insufficient, will the theater’s operating funds come out of Laguna Honda’s general fund operating budget intended to pay for patient medical care?

Still No Gift Shop, Other Unanswered Questions

Renne claimed, on March 6, that her Foundation is also assessing whether to re-open Laguna Honda’s patient gift shop. Although residents moved in to the new facilities fully two years ago, Laguna Honda’s other non-profit foundation, Volunteers, Inc., abandoned its decades-long funding of the gift shop, and the hospital has operated without one for the past two years, perhaps the only hospital in the Bay Area without a gift shop. If Renne’s Foundation has taken over two years to decide whether it should fund operations of the gift shop, how can it be expected to actually operate a community theater?

After all, AECOM recommended in its analysis, that operating a theater at LHH might be best done using a non-profit management model — surprise, Ms. Renne’s own non-profit gets AECOM’s nod — rather than using an in-house management, or contracted management model, in part because the hospital might potentially be given a seat on the Board of Directors of Renee’s Foundation. Renne adamantly told Commissioner Illig that she would not appoint a member of the Health Commission to her Foundation’s Board, so she could avoid “politics.” What makes the Health Commission believe that Renne would now appoint a hospital employee to her Board, when she wouldn’t appoint a Health Commissioner?

Renne’s “Assisted Living” Canard

Also on March 6, Renne asserted that her Foundation is standing by to assist with securing funding for assisted living housing on Laguna Honda’s campus. Readers may recall that in 2007, disability rights activists and others were sticker-shocked when the City announced its feasibility study for assisted living on the Laguna Honda campus would approach over $250 million to construct.

The senior rights activists rightly noted that converting Laguna Honda’s old buildings — the so-called “finger wings” fanning out from the main corridor on each floor — into assisted living housing was a bad idea. Although the finger wings were budgeted for asbestos abatement prior to demolition, cost overruns have eliminated from the project scope any asbestos abatement. Instead of demolishing the finger wings, plans have changed and the Health Department is now budgeting to rent out space in those buildings, or lease them for assisted living housing, rather than demolishing them.

Although senior housing advocates noted in 2006 that assisted living facilities deserve to be seismically safe, too, there was no funding available to retrofit Laguna Honda’s finger wings for seismic safety in 2007, and there is no funding for seismic safety available now.

If Renne’s Foundation was unable to raise one single penny during nearly an entire decade to assist with the $45 million it had pledged to raise for furniture, fixtures, and equipment, who really believes that her Foundation will be able to help raise over $250 million for assisted living housing any time soon?

Sadly, at the Health Commission’s November 6 meeting, San Francisco’s current Director of Public Health, Barbara Garcia, indicated the City might get some financial data if the Health Department signs an MOU with Renne to fix up Laguna Honda’s patient auditorium. Is Garcia engaged in magical thinking, expecting that Renne will actually sign an MOU and consent to providing financial data? Barbara: Will such disclosure be retroactive?

And would an MOU really be binding on Ms. Renne to actually raise an agreed-on amount towards assisted living? Or is this just more of Renne’s smoke and mirrors?

Rewarding Secrecy?

The Health Commission has no business awarding an MOU to operate Laguna Honda’s patient theater to an organization that it has previously fought tooth and nail to obtain basic, full, financial disclosure. Since Renne’s Foundation has refused to disclose revenue data for the first eight years of its initial operations, what makes the Health Commission believe it will start doing so now if it is granted a contract to operate the patient auditorium?

The Health Commission would never tolerate this level of secrecy from any of its other non-profit partners. Why is the Commission tolerating this behavior from former City Attorney Louise Renne? Is it because she’s above the law, or is it that open accountability is beneath her patrician sensibilities, much like Mitt Romney’s tax returns were too much for public disclosure?

Almost a decade into Renne’s stone walling, the Health Commission should simply sever all ties with her Foundation. The City should put a red light on any future collaboration with Renne until she starts accurately reporting her Foundation’s income and expenses. San Franciscans have had it with Renne’s dirty laundry.

Monette-Shaw is an open-government accountability advocate, a patient advocate, and a member of California’s First Amendment Coalition. Feedback: monette-shaw@westsideobserver.com.

December 2012

“Consensus Mayor’s” Sour Grapes

A legal theory holds that any law that “forbids an act in terms so vague that men of common intelligence and understanding must guess as to its meaning and differ as to its application violates the first essential of due process of law.” Mayor Lee was mistakenly advised he could go after his political foe, Sheriff Ross Mirkarimi, by invoking San Francisco’s overly-vague definition of official misconduct.

The lack of ethical reasoning and hypocrisy — when not sheer stupidity — emanating from San Francisco’s City Hall with its cadre of Deputy City Attorneys, is shocking to San Franciscans.”

Although former Mayor Willie Brown has advised Mayor Ed Lee to get over and move beyond the Supervisors’ reinstatement of Sheriff Mirkarimi (“Mayor Lee, bury hatchet over sheriff case,” SF Chronicle, Oct. 27), Lee continues to pout sour grapes. “Slick Willie” should have advised Lee that continuing to harass Mirkarimi may well result in Lee being a one-term mayor.

After all, San Franciscans have not ceded our democracy to the vagaries of mayoral case-by-case “discretion,” nor have voters granted Lee the authority to replace our rule of laws with either his own rules of “decency” or his so-called “sound judgment.”

As Citireport editor Larry Bush noted in a recent post (“Big Mouths, Little Brains”) regarding the Supervisors’ vote to reinstate Sheriff Mirkarimi, “There has been so much stupidity to choose from that it’s hard to know where to start.” Bush was referring to the botched Ethics Commission and Supervisors hearings “consensus” Mayor Ed Lee launched.

The lack of ethical reasoning and hypocrisy — when not sheer stupidity — emanating from San Francisco’s City Hall with its cadre of Deputy City Attorneys, is shocking to San Franciscans.

Stupidity of Mayor Lee’s Lawyers

There’s no sympathy to be found for Ed Lee’s reliance on the legal strategy developed by Deputy City Attorneys Sherri Kaiser and Peter Keith, most probably with the concurrence of their boss, Dennis Herrera.

Forget for a moment that the Ethics Commission threw out the official misconduct charges Lee initially filed and that the Ethics Commission then rejected all six of the amended charges the Mayor substituted. Forget that in order to move the charges to the Board of Supervisors, the Ethics Commission hastily incorporated portions of the Mayor’s amended counts four and five into a new hybrid charge just minutes before voting on August 19, depriving Mirkarimi’s lawyers of an opportunity to prepare a defense against an eleventh-hour new charge.

Look to the testimony of Ms. Kaiser during the Board’s hearing. Throughout the Ethics trial, Kaiser convinced the Ethics Commissioners that there had to be a “relationship test” between “official duties” and an official’s behavior. But at the Board’s hearing, Kaiser changed her tune, first saying that the decision to remove an elected official should be made on a case-by-case basis by relying only on the “sound judgment” of the Mayor, Ethics Commission, and the Supervisors. Then, Kaiser changed her tune again, saying that it is entirely a discretionary — not a “sound judgment” — decision and that it is not up to the Board of Supervisor’s to use their personal views of what the standards of conduct should be for the Sheriff.

Kaiser repeatedly said on October 9 that it would be “really wrong” to leave the removal of the Sheriff to a recall election. She claimed that voters had given the Mayor and Ethics Commission a clear definition of official misconduct, that voters “have determined for themselves how they wish to be governed,” and that they “would like to be governed” by asking their “Mayor, their Ethics Commission, their Board of Supervisors, to take action to protect them” via the official misconduct process, rather than a recall.

Kaiser went so far as to compare Mirkarimi to a hypothetical Animal Control Officer who might be running a dog fight ring on his private time. When Kaiser said, “No one wants Michael Vic in control of the Animal Control Department,” she was booed by the audience for blurting out such a stupid analogy, but she charged ahead, anyway.

Kaiser stated that the Mayor “certainly does not agree with Commissioner Hur’s decision to emphasize the need for a bright-line rule” that would clearly, and narrowly, define official misconduct. Kaiser claimed that voters had intended to infer broader, not narrower, interpretation of official misconduct.” She went so far as to say that a so-called bright line rule seeking “clarity simply for the sake of clarity, predictability simply for the sake of predictability, is not a reason to … narrowly constrict ethical duties of officers.”

More so than Supervisor Christina Olague, Supervisor Jane Kim peppered Kaiser with astute questions. Kim noted that Kaiser testified to the Board that the “relationship test” was not enough (which was odd, since Kaiser had focused heavily on the relationship test during the Ethics hearings). Kim asked Kaiser: “So it would be a relationship test, plus what the Mayor and the Ethics Commission [determined], what we deem as falling below the standard of decency, and that is [on] a case-by-case basis?” At first, Kaiser responded, “Yes, that’s correct.” Then corrected herself, saying “I think it is a discretionary decision … I think that it is, at bottom, a judgment call.”

Kaiser’s waffling startled Kim, who then asked “Does that open us up to the vagueness issue, which may make that clause then unconstitutional, because then a person may not reasonably be able to predict when their behavior is official misconduct or not?” Honing in on the “standard of decency” clause added to the Charter in 1995, Kim noted that any standard of decency may change over time, depending on who is appointed to the Ethics Commission, who has been elected Supervisor, and who is the elected Mayor, opening the question of whether the definition is too vague to determine what is or isn’t official misconduct.

That’s when Kaiser replied it is not up to the Supervisor’s personal views, and the standards of decency and conduct are “position-specific” that should be discerned with the help of people in a given profession, not by the Board. If that’s the case, why were the Supervisors even involved?

Kaiser Falsely Claims “No Legislative History”

Kaiser repeated that the voters put the official misconduct tool in the Mayor’s and Board’s hands to serve the people’s will to remove officials without the trouble of a recall election. She claimed that there was “no legislative history, no ballot history, that sheds light” on the intent of the authors of the Charter’s official misconduct provision.

In a contrary opinion, Mr. Bush notes that he covered every session of the Charter Revision Committee in ‘94 and ‘95 that wrote the official misconduct language, and the drafter’s intent had not been to update the Charter language to address the Superior Court ruling in Airport Commissioner Larry Mazzola’s case. Bush asserts the intent of the Committee was to address “concerns that a ‘moral character’ provision was a left-over of the language used to bar people from professions based on sexual orientation.” Bush notes that neither the Ethics Commission nor the City Attorney bothered going to the Main Public Library where the Committee’s minutes are archived to see the legislative and ballot history.

Other observers have noted that the 1995 voter guide contained a digest by then City Attorney Louise Renne that explicitly described the changes in our ethics law as insignificant. Clearly, voters weren’t told in ‘95 that they would be giving new powers to the Mayor, or that they would be ceding to the Mayor authority to make discretionary decisions to remove elected officials without a recall election. Had voters been told that the Mayor would gain such authority the amendments would not likely have passed and we’d still have the “moral character” provisions.

Vague Is as Vague Does

Ms. Kaiser testified that the people — the voters — put the official misconduct language into the City Charter. She asserted that the language isn’t “vague,” the language makes it more “nimble” when determining official misconduct.

Kaiser was completely misguided during her Board testimony. Voters never get to choose the actual legal text of ballot language put before them, unless it involves a citizen-initiative measure. Voters have no say over the language chosen for measures placed on the ballot by the Mayor or Board of Supervisors.

California courts permit vague ballot measures because they are sensitive to the need of government in large urban areas to delegate broad discretionary power to administrative bodies without paralyzing local jurisdictions.

Ms. Kaiser now claims that if the official misconduct language is too vague, it’s because the voters chose to approve the vagueness put before them written by someone else, over preciseness.

Seven Stupid Supervisors

October 9 was a very dark day for San Franciscans, because only four of our eleven Supervisors voted to reinstate Sheriff Ross Mirkarimi. Supervisors Christina Olague, Jane Kim, David Campos, and John Avalos reached the correct conclusion: That Mirkarimi’s behavior — deplorable as it may have been — did not rise to the definition of official misconduct.

In stark contrast, the remaining seven District Supervisors — including Mark Farrell, Sean Elsbernd, Malia Cohen, Carmen Chu, Scott Wiener, Board President David Chiu, and Eric Mar — knowingly voted to hand the Mayor unlimited precedent-setting power to bring official misconduct charges against political foes, a process ripe for political shenanigans and mayoral abuse. All seven also knowingly voted to accept the Ethics Commission’s constitutionally vague interpretation of official misconduct. Had these seven Supervisors prevailed, they would have knowingly handed to some future court proceeding — as Mr. Bush reports — clear evidence that the official misconduct charges against Mirkarimi were unconstitutionally vague, since the Mayor and the Ethics Commission never adequately defined official misconduct (and can’t, unless they ask voters to change the Charter again).

In a clear example of irony, four of the seven Supervisors who voted to oust Mirkarimi were referred by the Sunshine Ordinance Task Force to the Ethics Commission over probable official misconduct themselves. The four — the Board’s then Land Use and Economic Development Committee composed of Supervisors Mar, Cohen, and Wiener — along with Board President Chiu, appear to prefer handing the Mayor unlimited power to bring official misconduct charges on a case-by-case, unconstitutionally-vague basis, without any clear standard of the definition of official misconduct that would apply to all City employees.

Ed Lee’s Unequal “Discretion”

Mr. Bush notes: “None of this can obscure the reality that it was Ed Lee who is responsible for the defeat of his Official Misconduct charge.” Bush reported that Lee testified under oath at the Ethics Commission that he had not given any attention to the City Charter’s requirements for official misconduct charges, admitted he had no written policy regarding official misconduct, and then insisted that even if an individual case involved a criminal conviction, he would still use his “discretion” on whether to pursue official misconduct charges on a case-by-case basis. Bush notes this may end up being a text book example of the description of “vague” as one can find, which judges all too often find objectionable.

Bush has documented Mayor Lee’s and the Board of Supervisor’s unequal application of “discretion.” For instance, although the Ethics Commission referred a case of official misconduct against Library Commission president Jewelle Gomez to the Mayor, requesting that the Mayor remove her from an appointed position, the Mayor has ignored the Ethics Commissions recommendation for over a year, and has not taken any action against Gomez.

Worse, on June 14, 2011, ten of our current Supervisors (excluding Olague [she was not yet appointed]) confirmed by a unanimous 11-to-zero vote the appointment of Julius Turman to the Police Commission, despite the fact that the Board of Supervisors knew (or had to have known), that Turman had been arrested over domestic violence charges. Turman’s former boyfriend, Philip Horne, had accused Turman of beating him up on January 2, 2006, giving Horne a bloody nose, scratches, and a loosened tooth. Horne alleged that then-District Attorney Kamala Harris didn’t prosecute because of Turman’s political connections. Despite the fact that the felony domestic charges were dropped by prosecutors, Turman settled out of court with Horne for an undisclosed amount. Is there no “nexus” between Horne’s domestic violence history and his duties as a Police Commissioner?

While Supervisor Jane Kim dissented in the Rules Committee regarding Turman’s appointment, indicating she had concerns about appointing people to a police oversight body if there were questions about an applicant’s past and experience that might weaken their oversight “capacity,” Kim nonetheless voted along with the full Board to appoint Turman, despite his domestic violence history.

Not only did the Board unanimously appoint Turman to the Police Commission, apparently no domestic violence prevention agency publicly opposed Turman’s confirmation. Neither Andrea Shorter, a political consultant who chairs the City’s Justice and Courage Oversight Panel, nor Kathy Black, director of La Casa de las Madres, a shelter for domestic violence victims, spoke up to object to Mr. Turman’s appointment, despite the initial felony domestic violence charges against him. Are Shorter and Black, and the rest of the domestic violence prevention community, selectively holding Mirkarimi to a different standard than they apply to Turman, on a case-by-case basis?

Then there’s the problem of unequal treatment of Fire Chief Joanne Hayes-White. Mr. Bush notes that “over the past several years, cases involving high profile or politically connected individuals have been dropped. This includes a police report on Fire Chief Joann Hayes White, accused by her husband of hitting him repeatedly in front of their children.” Seems that neither the Mayor, the Board of Supervisors, nor the domestic violence prevention community wants to hold Chief Hayes-White to the new “standard” they invented to hang the Sheriff. More hypocrisy and selectively unequal treatment for favored politicians and City officials.

Supervisor Wiener Requested a “Do-Over”

Just thirty seconds before the Board of Supervisors were to cast their votes determining Mirkarimi’s fate, misguided Supervisor Scott Wiener asked whether the Board could have a “do-over,” asking “Are we able to sustain any charge alleged by the Mayor, whether or not the Ethics Commission recommended sustaining of that charge?”

Scott Emblidge, the special attorney advising both the Board and the Ethics Commission — as if there was no conflict of interest between a single lawyer advising both bodies — responded that the Board “[is] able to sustain any charge,” but that the Board needed to be voting on the same thing.

This shocked observers, who believed that the Board could only consider charges brought by the Mayor that the Ethics Commission had actually sustained. Wiener — and everyone else — knew at that point in the proceeding that the Board was about to hand Mr. Mayor an embarrassing loss on a 7-to-4 vote, when the Mayor needed at least nine votes to prevail.

But Wiener wanted to turn the clock back to reconsider charges that the Ethics Commission had clearly already rejected. Despite being advised that the Board could reconsider what Ethics had rejected, Wiener curiously decided not to pursue a do-over and let the issue go, even though he appeared eager to resurrect the Mayor’s flawed charges against Mirkarimi.

Misguided Media

On October 10, the day after the Board of Supervisors voted 4 to 7 to reject the Ethics Commission’s recommendation against Mirkarimi, the San Francisco Chronicle published an editorial (“Shame on four supervisors”), alleging that the four “rationalized” their votes by raising “the question of whether a man elected to be sheriff could commit official misconduct before actually taking office.” The Chronicle was disingenuous: The Board of Supervisors had not raised that question; indeed, that whole question had been raised by the Mayor and an all-too-eager-to-please Ethics Commission that did everything it could to avoid answering that question. The question Ed Lee posed to the Ethics Commission, and the question the Board of Supervisors were asked to answer (but avoided), was whether there has to be a “nexus” between any official duties, and actual behavior.

For her part, Melissa Griffin over at the San Francisco Examiner, opined on October 18 that since the sexual battery charges against District 5 supervisorial candidate Julian Davis is a misdemeanor, the four Supervisors (who did not find a nexus between Mirkarimi’s official duties and his wife’s bruised arm) had somehow concluded that Mirkarimi’s behavior had been acceptable for a public official to commit. Like Deputy City Attorney Sherri Kaiser before her, Griffin attempted to draw parallels between Mirkarimi’s wife’s bruised arm, and child abuse, elder abuse, assault, battery, and hit-and-run cases that occurred after-hours, or before assuming office.

Griffin then lamented that an “unsuspecting public” has been “burdened” by the task of mounting a recall effort against Mirkarimi, making “it easier for abusers to remain in office.” Griffin asserts the four supervisors are “cowards” for foisting an expensive, time-consuming, recall process against Mirkarimi onto voters. But Griffin mentions nothing about the expensive $1.14 million in City Attorney costs the Mayor has racked up mounting a failed effort to oust Mirkarimi during the Ethics Commission’s probe. Worse, Griffin studiously ignored Deputy City Attorney Kaiser’s assertion that a recall election is the wrong approach.

Notably, Griffin mentions not one word about abuser Turman remaining in office as a Police Commissioner. Perhaps that’s because Turman and Jewelle Gomez are both African Americans; both are appointees, not elected officials; and both are reportedly gay or lesbian, as opposed to Mr. Mirkarimi, who appears to be straight. Indeed, Griffin wails about violence against women, but mentions nothing about the domestic violence against men inflicted by Turman and Hayes-White.

For its part, the Examiner editorialized on October 14 (“People deserve a say in the Mirkarimi case”), that if voters are unhappy with the way the four Supervisors interpreted the City Charter in Mirkarimi’s official misconduct case, voters should mount the very recall process Griffin believes is “burdensome,” and which recall process the Mayor’s own attorney, Ms. Kaiser, believes is “wrong.”

Never mind that the four Supervisors correctly interpreted the City Charter, the Examiner wails. What’s important, the Examiner asserts, is that “any incident of domestic violence is inexcusable.” The Examiner appears to have turned a blind eye to the domestic violence allegations against both Turman and Hayes-White. By its lack of logic, the Examiner appears to believe that Turman’s and Hayes-White’s behavior was excusable, but that Mirkarimi’s was not.

In addition, while Mirkarimi has now been thoroughly “investigated” by the Mayor, the Ethics Commission, and the Board of Supervisors, the Examiner now asserts that although Mirkarimi appears to have been absolved of the official misconduct charges by the official processes put in place to protect voters, Mirkarimi now deserves to be handed double-jeopardy by being “tried” all over again via a recall election. How many times is the guy going to get tried for a single “crime”? If our elected leaders can’t, and haven’t, agreed on whether “official misconduct” occurred, how can the Mayor, Ms. Kaiser, and the Examiner believe that voters — the vast majority of whom are neither lawyers, nor have likely been trained in ethical issues — should now be expected to discern definitively what legal scholars and ethicists were unable to discern?

Consensus Mayor’s Sour Grapes

On October 10, the day after Mirkarimi was reinstated by the Board of Supervisors, District Attorney George Gascón released a statement demanding that Mirkarimi recuse himself from the supervision of domestic violence activities in his department. Gascón reportedly threatened Mirkarimi with “legal action” if he didn’t recuse himself.

Larry Bush notes that Gascón’s demand appears to have little meaningful impact, as there is nothing in the Charter that permits the District Attorney to demand an elected official — abandon duties set in the Charter.

Bush notes that a CitiReport investigation revealed Police Department records showing 3,515 police reports of domestic violence were filed, but that Gascón’s District Attorney staff filed only 245 misdemeanor cases and 240 felony cases — totaling just 14 percent — of the 3,515 police reports. Bush also reports that a San Francisco Public Press investigation revealed Gascón’s District Attorney Domestic Violence Team reviewed about 8,600 criminal cases but dropped about 6,200 of them without going to court, and that the incidence of dropped cases has actually increased under Gascón’s tenure.

Given Gascón’s domestic violence track record, he’s displaying pure hubris demanding anything from Mirkarimi. And where are Ms. Black and Ms. Shorter in this? Why aren’t they screaming their heads off over Gascón’s pathetic domestic violence record, selectively focusing only on Mirkarimi? How can Mayor Sour Grapes look anyone straight in the face — or himself in the mirror — refusing to bury the hatchet and actually work with Mirkarimi, while throwing his mayoral arms around hypocrite Gascón? And why has Melissa Griffin all but ignored Gascón’s lousy record, while she foams at the mouth over Mirkarimi?

Not to be outdone, on October 26 Mayor Lee wrote to Mirkarimi, now alleging that certification of batterers’ intervention programs “may be in jeopardy.” [Note Lee’s use of “may be,” not “are,” and that Lee appears to have raised this issue only after the Supervisors reinstated Mirkarimi.] Turning the screw, Lee now asks Mirkarimi why he’s qualified to oversee the Sheriff Department’s domestic violence programs. It appears that the sour grapes Mayor just can’t let go of his loss at the Board of Supervisors.

On Monday, October 29, news broke that Mayor Lee’s prominent ally — Silicon Valley billionaire Ron Conway and his wife Gayle — formed an independent expenditure committee to oppose Supervisor Olague in next week’s District 5 election. Previously, the Conway’s contributed $500 each to Olague’s election campaign, but their new independent expenditure committee — which can raise an unlimited amount of money — has quickly amassed, at minimum, $120,000 to go after Olague in retaliation for her vote to reinstate the Sheriff.

Can anyone say, “Citizen’s United”? How much meddling will the out-of-towner billionaire Conways do on behalf of their friend, Ed “Sour Grapes” Lee? How much money-equals-speech will the Conways throw against Olague to unseat her by buying an election? The Mayor is misjudging San Franciscans’ tolerance for sour grapes.

Will the Conways also target Supervisor Jane Kim’s re-election campaign in 2014?

On a personal note, I am offended that the Mayor continues to equate the bruise Mirkarimi’s wife sustained to the sexual molestation my three sisters endured from our father (leaving one of them with life-long mental illness), and my father’s intermittent psychological abuse of my mother for 22 years. The Mayor’s insistence that a bruise is somehow equal to what they endured is a slap in the face to my sisters and mother — and by extension, a slap in mine — denigrating their collective trauma.

When the Mayor and District Attorney Dennis Herrera run for re-election, voters should toss them both out of office — Herrera for allowing his subordinates to mount this ridiculous case against Mirkarimi, and Lee for pouting like a child after losing a blatant, politically motivated witch-hunt.

If voters don’t rout both men from office, they’ll be handing our democracy over to demagogues, and billionaires buying City Hall influence.

Monette-Shaw is an open-government accountability advocate, a patient advocate, and a member of California’s First Amendment Coalition. Feedback: monette-shaw@westsideobserver.com.

November 2012

Democracy San Francisco Style

Swimming in “Official Misconduct”

Is San Francisco governed by its rule of law, or by the law of its rulers?

The hypocrisy of San Francisco’s Board of Supervisors and its Ethics Commission no longer comes as a surprise to most open government observers; hypocrisy clearly visible in two cases is currently shedding light on the death of democracy in San Francisco.

It will now be up to the Board of Supervisors to explain how the Ethics Commission could be permitted to violate the City Charter in the Mirkarimi matter, while the Supervisors make false claims against the Task Force.”

The first case involves the Board of Supervisors, which wrongly alleged that the Sunshine Ordinance Task Force (SOTF) violated the City Charter, when in fact the Task Force had not. Supervisor Scott Wiener — who the Task Force found engaged in official misconduct regarding the Parkmerced development deal — went so far as to allege that the SOTF had engaged in “official misconduct” when the Task Force had done no such thing.

The second case involves the Ethics Commission’s recommendation now submitted to the Board of Supervisors to remove Sheriff Ross Mirkarimi from office for “official misconduct;” to reach that recommendation the Ethics Commission itself appears to have violated the City Charter by exceeding its authority.

It will now be up to the Board of Supervisors to explain how the Ethics Commission could be permitted to violate the City Charter in the Mirkarimi matter, while the Supervisors make false claims against the Task Force.

Sunshine Task Force Shut Down

The Observer reported in its last several issues that the Board of Supervisors has effectively shut down our local Sunshine Ordinance Task Force, the quasi-judicial body with which citizens can file administrative complaints regarding open access to public meetings and public records. As reported, the Task Force has not met and conducted any of the people’s business since the end of May.

Because the Board of Supervisors improperly removed the ordinance-required physically disabled Task Force member and failed to appoint another physically disabled member, the Task Force was forced to abruptly adjourn its June 6 and July 7 meetings, and cancelled its August 1 and September 5 meetings since the body was not in compliance with Sunshine Ordinance section 67.30(a) that requires a physically-disabled member sit on the Task Force at all times.

Although the Board of Supervisors had to have known of this legal requirement since at least June, the Supervisors have not appointed a disabled member during the past four months. Unfortunately, on Wednesday, September 19, the Task Force also cancelled its October 3 meeting, because a disabled member had still not been appointed when the Board of Supervisors rejected re-appointing Bruce Wolfe a second time. The Task Force, and citizens who have filed legitimate Sunshine complaints, have been immobilized for five months.

Supervisors Invoke “Let’s Get Even” Retribution

As previously reported, the issue that launched the Board of Supervisors ire and their “let’s get even” retribution involved a Sunshine complaint regarding the Parkmerced development deal, which resulted in four members of the Board of Supervisors referral by the Sunshine Task Force to the Ethics Commission over allegations of official misconduct. Pastor Lynn Gavin — a candidate for the Board of Supervisors in District 7 and a resident of Parkmerced, until being unjustly evicted — filed a Sunshine complaint alleging that the Board of Supervisors wrongly considered 14 pages of last-minute amendments to the Parkmerced development agreement just minutes before voting on the matter, but without providing the amendments to members of the public prior to their vote. The Task Force ruled the last-minute amendments violated the Sunshine Ordinance, and referred the matter to the Ethics Commission for enforcement of official misconduct against four City supervisors, including David Chiu and Scott Wiener.

Reportedly, the Board of Supervisors were not as annoyed so much by the SOTF’s referral to Ethics as they were by the Task Force’s additional referral of the Parkmerced violation to the District Attorney. The Task Force began referring official misconduct complaints to the D.A. following years of inaction on official misconduct cases referred to the Ethics Commission, which has dismissed without public hearings all previous official misconduct cases referred to it by the Sunshine Task Force, except the case against Library Commission president Jewelle Gomez.

Supervisors Haven’t Learned Their Lesson

During the full Board’s September 18 meeting, the Supervisors considered the Clean Power SF public power measure with Shell Oil. Supervisor Wiener, along with other Supervisors, complained during the September 18 hearing that they had been handed several amendments to the Clean Power SF measure just as they were walking into Board chambers to cast their votes. Clearly, members of the public weren’t provided copies of Clean Power SF amendments before the September 18 hearing, repeating the same situation as the Parkmerced amendments.

This suggested that the Board of Supervisors hasn’t learned its lesson about complying with the Sunshine Ordinance, given that it again willfully engaged in what can only be considered “official misconduct.”

Ethics Commission Violates City Charter

San Francisco’s mainstream daily news media have reported only the most superficial information about the issues underlying Mayor Ed Lee’s official misconduct charges against Sheriff Ross Mirkarimi. In stark contrast, a detailed, dispassionate analysis was posted anonymously on September 9 in a blog article titled “San Francisco Ethics Commission Official Misconduct Proceeding Against Sheriff Ross Mirkarimi — Thoughts on Final Hearing – August 16, 2012.”*

The anonymous author thoughtfully presents successive observations about the deliberations of the Ethics Commission, raising about ninety well-reasoned arguments of how the Ethics Commission went astray.

In a series of tables, the author examines each of the Mayor’s six counts against Mirkarimi—counts that had to be revised and reintroduced after the Ethics Commission rejected the Mayor’s initial charges. Notably, none of the Mayor’s revised six counts were sustained in full by the Ethics Commission, which rejected four of the six counts outright, and then created a single hybrid new charge by picking and choosing portions of the remaining two counts. The hybrid charge was raised just minutes before the Ethics Commission voted four-to-one against Mirkarimi, depriving him of the information, vital to his defense, of what charge he was actually fighting until just seconds before the Commission’s verdict.

The author illustrates quite clearly that the only sustained supporting fact (Mirkarimi’s wife’s bruised arm on New Year’s Eve) did not relate to any of the Sheriff’s duties of office, so it can’t possibly be “official misconduct” related to Mirkarimi’s official duties.

The author examines the new “relationship” tests the Ethics Commission dreamt up to evaluate whether any relationships existed between Mirkarimi’s alleged wrongdoing and the office(s) he held. The Ethics Commission went to great lengths to dream up new relationships to support the Mayor’s charge that Mirkarimi’s conduct had fallen “below the standards of decency, good faith and right action impliedly required of” elected officials. Ethics Commissioner Paul Renne considered it pointless to discuss any “relationships” at all. But Commissioners Liu, Studley, and Hayon held to their moral certainly that Mirkarimi was guilty, and through “backwards reasoning,” they simply made up a middle-ground “relationship” test.

But the made-up requirements are so diluted that they amount to no requirement at all, exactly what Commissioner Renne had insisted: No direct relationship between duties of office held and alleged conduct was necessary.

The anonymous author concludes that a court will likely conclude in the future, and reject out of hand, Renne’s blatantly unconstitutional interpretation of the definition of official misconduct. The author also believes that with just a bit more effort, a court will also reject the “backwards reasoning” Commissioners Liu, Studley, and Hayon used to arrive at the same unconstitutional conclusion.

The analysis concludes with two key points: First, the Ethics Commission was strictly limited to a single legal question: Did a public official commit “official misconduct” as defined in City Charter Section 15.105(e), or not? The Ethics Commission didn’t answer this question.

“Upgrading” Charges Exceeded Commission’s Authority

Instead, they made up their own rules. The author notes, “Voters never granted the unelected five-member Ethics Commission the authority to make recall decisions for them. Its authority is strictly limited to a legal question. … The Ethics Commission may not exercise authority it has never been granted by ‘upgrading’ non-official misconduct to ‘official misconduct’ merely because the Ethics Commission is confident — even certain — that voters would not have elected the official had they known what the Ethics Commission has since learned.”

The only way the Ethics Commission could do that would be by substituting their own political judgment for the judgment of voters, but they have no authority to do that, either.

Second, how far back in time can a Mayor or Ethics Commission look to uncover evidence of former improper misconduct in misguided attempts to find relationships to previous conduct and an elected or appointed office held? Eight months? Two years? An entire lifetime?

If this new “standard” is upheld, every City employee could face removal by a vindictive Mayor. Who would ever choose to become a public servant or public employee with rules like that in place? If Mayor Lee is allowed to make up these rules as he goes along, what’s to stop him from fabricating charges against, say, Supervisor Sean Elsbernd or Supervisor Scott Wiener? Is any employee safe with this sort of a precedent, and does the Board of Supervisors really want to hand such open-ended authority to the Mayor in perpetuity? How would that work under a really rotten mayor?

By making up the rules of the misconduct proceedings against Mirkarimi as they went along, the Ethics Commission appears to have violated the City Charter itself by exercising authority it has not been granted.

*Further reading: The dispassionate, anonymous analysis of the Ethics Commission’s handling of Sheriff Ross Mirkarimi’s case can be found online at http://rjemirkarimi.blogspot.com/2012/09/ethics-commission-proceeding-against.html. It is well worth the read.

Monette-Shaw is an open-government accountability advocate, a patient advocate, and a member of California’s First Amendment Coalition. He received the Society of Professional Journalists–Northern California Chapter’s James Madison Freedom of Information Award in the Advocacy category in March 2012. Feedback: mailto:monette-shaw@westsideobserver.

October 2012

Wiener Out of Control

Skullduggery at Board of Supervisors leaves City Hall wide open for corruption to run rampant

San Franciscans should not only be alarmed by the now four-month complete shutdown of our local Sunshine Ordinance Task Force (SOTF), we should pay close attention to how the shutdown of the SOTF came to pass.

Sunshine Ordinance Task ForceLast Sunshine Task Force: Suzanne Manneh, Allyson Washburn, Vice Chair Bruce Wolfe, Jay Costa, Richard Knee, Jerry Threat (City Atty), Chair Hope Johnson and SOTF Administrator Andrea Ausberry

As the Observer reported in July in “Who Killed Sunshine?” Supervisor Scott “The Tinkerer” Wiener single-handedly killed open government by shutting down our local Sunshine Task Force, leaving San Franciscans without any citizen oversight of access to public meetings and access to public records, and leaving City Hall wide open for corruption to run rampant. To support his false claim that the Sunshine Task Force engaged in official misconduct of its own and had undermined transparency in government, Wiener failed to provide any evidence and lied at least four times during a full Board of Supervisors meeting on May 22.

To support his false claim that the Sunshine Task Force engaged in official misconduct of its own and had undermined transparency in government, Wiener failed to provide any evidence and lied at least four times during a full Board of Supervisors meeting on May 22. ”

He wrongly claimed on May 22 that the Task Force had exempted itself from the San Francisco Charter, and wrongly claimed the Task Force had said “How dare you shine sunlight on us?” when the Task Force had never claimed any such thing. Wiener claimed he asked for an “audit” of the costs of compliance with the Sunshine Ordinance, when in fact he asked for a “survey.” Wiener also inflated the average number of times City employees had to attend hearings to resolve Sunshine complaints.

Bruce Wolfe and Guide dog LadyOfficial Misconduct Clearly peeved that the Task Force had referred him to the Ethics Commission for official misconduct 1n September, 2011 over the Parkmerced development deal, Wiener engineered kicking physically disabled member Bruce Wolfe off the SOTF on May 22, filling the remaining “member of the public” seats with non-disabled appointees.

Photo: Bruce Wolfe with his guide dog Lady

Wolfe was the only physically handicapped member of the Task Force, which now has been unable to meet for four months due the lack of a physically disabled member. The Board of Supervisors knowingly removed the only disabled member of the SOTF and failed to appoint a disabled replacement, as required by Sunshine Ordinance Section 67.30(a). The Supervisors did this, despite the fact that over half of them are lawyers who should have known of this legal requirement in the Sunshine Ordinance — including Supervisor Scott Wiener, a Harvard Law School graduate and a former SF Deputy City Attorney.

Non-Compliance Adjournments On both June 6 and July 11, the Task Force voted to adjourn its meetings without taking any action on its agendas due to not being in compliance with Sunshine Ordinance Section 67.30(a). The Task Force subsequently cancelled its August meeting for being non-compliant with Section 67.30(a), and will also have to cancel its September meeting, as a disabled member has not yet been appointed to the Task Force.

Wiener’s Latest Misinformation

On July 17, during a hearing to re-appoint Michael Antonini to the Planning Commission, Supervisors David Campos and Jane Kim criticized Wiener’s handling of the SOTF appointments on May 22. Campos and Kim noted that the SOTF members removed on May 22 were ousted because they took a “different approach” than members of the Board of Supervisors may prefer.

History Re-written True to form, Wiener didn’t skip a beat, using revisionist history to lie again. Wiener claimed that the actions to remove Task Force members on May 22 were “primarily taken by the Rules Committee and to a lesser extent by the full Board [of Supervisors].” Wiener repeated his remarks that “the Sunshine Task Force was being run in an incompetent manner which violated the City’s Charter,” and that it was the Rules Committee that “recommended removing almost all the [SOTF] incumbents except for one and the [full] Board voted to remove that final incumbent. So the majority of the removing happened before [the nominations] got to the full Board,” Wiener testified.

This is patently untrue, and Wiener’s revisionist history-making.

First, the Rules Committee forwarded a recommendation to re-appoint Member Wolfe, and it was, indeed, the full Board that overturned the Rules Committee recommendation, the lie being that the full Board did not play a “lesser extent” role, they played a very aggressive role under Wiener’s insistence to remove Wolfe.

Second, of the 10 vacancies on the Sunshine Task Force considered on May 22, only half (five) were new appointees. Wiener incorrectly claimed on July 17 the remaining five were removed by Rules, since one member (Wolfe) was actually recommended for re-appointment by Rules, and the other four were continued to the call of the Rules Committee’s chair.

“Different Approach” Proviso Indeed, several of the Supervisors expressed concern on July 17 that removing appointees such as Antonini or Wolfe from boards and commissions based solely on whether the appointees exercise a “different approach” than would the Board of Supervisors will open a can of worms. Indeed, what seems to annoy “The Tinkerer” Wiener the most is that, while the Board of Supervisors can review or modify decisions of the Planning Commission, the Board has no authority to review or modify decisions made by the Sunshine Task Force.

How Did We Get Here?

On Thursday, May 17, 2012, the Rules Committee considered the nominations of 23 applicants for appointment to 10 of the Sunshine Task Force’s 11 seats. Following testimony and debate, the Rules Committee forwarded to the full Board of Supervisors the names of six applicants recommended for appointment to six of the SOTF’s seats, including Bruce Wolfe for Seat 8, the seat Wolfe has held for a number of years. For unknown and unstated reasons — but most likely at the Wiendr’s request — Supervisor Mark Farrell introduced a motion on May 17 to “divide” the recommendations for Wolfe’s appointment from the other five recommendations; but Wolfe was recommended separately for re-appointment.

The Rules Committee also recommended to place appointment of four other SOTF seats to the “Call of the Chair,” continuing those appointments to a future Rules Committee meeting when its chairperson schedules a subsequent hearing to finalize the four remaining appointments.

The SOTF appointments were first received on May 9, and assigned to the Rules Committee for a hearing eight days later on May 17. The full Board considered the Rules Committee recommendations during a Committee Report on May 22, when Wiener engineered overturning the Rules Committee recommendation to re-appointment Wolfe — throwing Wolfe off the Task Force, as the Westside Observer reported in our July issue.

Wiener’s Crony Appointment Wiener’s nominee to replace Bruce Wolfe was Todd David, who appears to have had no qualifications to serve on the Sunshine Task Force. Indeed, Mr. David’s application listed no qualifications to serve. Mr. David’s Form 700, Statement of Economic Interests — a document required as part of SOTF’s application process — failed to include the pre-printed form, Schedule B, Interests in Real Property. Instead, Mr. David submitted a written statement in lieu of Schedule B in which he neglected to report the appraised value of a multi-family residential property he owns at 384 Eureka Street appraised at $2.1 million, and neglected to report rental income he receives from the multi-unit property.

Notably, although the Rules Committee had only considered David’s typed statement, rather than the required Schedule B, the Rules Committee did not recommend Mr. David for appointment to the Task Force. It was Wiener who chose to substitute Todd David in place of the Rules Committee’s recommended appointee, Bruce Wolfe.

Complaints Following a Complaint to the Board of Supervisors that it should not have accepted a typed statement in lieu of the Schedule B, a Board clerk replied that it would be disclosed only if Mr. David submitted the actual Schedule B to the Ethics Commission; the Board’s clerk appeared unwilling to ask Mr. David to re-submit the required form.

On a complaint filed with the California Fair Political Practices Commission (FPPC) regarding Mr. David’s substitution of a typed statement in lieu of Schedule B. The FPPC determined David had violated California’s Political Reform Act by failing to disclose his interests in real property and issued a warning letter to Mr. David on August 22, after he submitted the proper Schedule B.

More of Mr. David’s Forgetfulness

During a Board hearing on his appointment to SOTF, David stated that “There’s nothing more important for government than to be transparent so that the voters who have elected you know that you’re making really good decisions.”

David’s “transparency” seems to be entirely opaque. In addition, there were a number of other oddities on his application to the SOTF, and his responses to transparency questions are troubling.

Discrepancy When asked why his application hadn’t indicated that the California Secretary of State suspended “TSD Capital, LLC’s” (Todd Stuart David Capital) privileges to operate as a business entity in California in December 2011 for failure to meet franchise tax requirements because he failed to file a return or failing to pay taxes, David responded only that he needed to speak with the Secretary of State about this “discrepancy,” since David claims he filed a “final” tax return for his TSD Capital business “three or four years ago” dissolving that business. Why the State took action in December 2011, and Mr. David is only now learning that a “discrepancy” exists with State records is curious, at best.

Can’t Recall When asked why he submitted his application on April 27, he couldn’t recall. The date April 27 is significant as being the last date of any SOTF appointee’s term, and the date on which previous member’s appointments were scheduled to end.

Insider Maneuver When asked why he faxed his SOTF application to Supervisor Wiener’s fax machine, instead of the Clerk of the Board, David lamely claimed he had Wiener’s fax number handy, and had asked Wiener’s staff to just walk his application down the hall to the Clerk of the Board. Why did David seek Wiener’s intervention, when Wiener doesn’t sit on the Board’s Rules Subcommittee?

Notably, Wiener does sit on the Board’s Land Use and Economic Development Subcommittee, which subcommittee may be asked in the future for a land use change to convert a parking lot in Noe Valley into a mini-park to prevent the parking lot being sold and turned into condos. Mr. David serves as the president of Resident’s for Noe Valley Town Square, an organization planning to secure a $2 million Open Space Funds commitment from the City’s Recreation and Parks Department. Asked if anyone is hoping that by Mr. David serving on the SOTF it may help the Resident’s for Noe Valley Town Square secure the $2 million in Open Space Funds, he responded that “the project will or will not receive funding base [sic] on its own merits.”

“I don’t recall” When asked why he hadn’t listed several of his civic affiliations on his SOTF application — as Executive Director of edMatch, and as a steering committee member of Parents PAC (a political action committee) — David replied “I don’t recall” why he had omitted both affiliations from his application, calling into question whether Mayor Ed “I Don’t Recall” Lee is now coaching others on how to use former Mayor Willie Brown’s “I don’t recall” line of defense.

Parallels to the Mirkarimi Case

On August 16, the Ethics Commission deliberated its findings against Sheriff Ross Mirkarimi. Troublingly, Mirkarimi’s lawyer David Waggoner noted that the Ethics Commission had not sustained in full any of the six charges in the amended charging document with which Mayor Ed Lee eventually charged Mirkarimi. Waggoner noted that the Ethics Commission had instead substituted some sort of a single hybrid charge that it made up on the spot on August 16, combining portions of separate charges that weren’t completely sustained into a fresh new charge that surfaced just seconds before Ethics concluded its deliberations, a new charge Mirkarimi hadn’t even been aware of during the Ethics Commission’s months-long kangaroo court.

Waggoner also noted that if the Ethics Commission rejected some of the counts against Mirkarimi, by the clear language of the Charter, the Commission wouldn’t be sustaining all of the charges, and if Ethics wasn’t going to sustain all of the initial charges, then the Commission couldn’t recommend Mirkarimi be removed, because the Charter’s clear language doesn’t give the Ethics Commission the option to pick and choose among some charges, but not other charges.

Grave Concerns To his credit, Ethics Commission president Benjamin Hur was the lone dissenting vote against finding Mirkarimi guilty of official misconduct. Hur indicated he had “grave concerns” that overly-broad interpretations of which behavior constitutes official misconduct may give mayors a “strong tool” — and perhaps free license — to attempt to remove political opponents inappropriately.

The parallels between the Mirkarimi case and the SOTF appointments are striking: Unsupportable and false accusations were simply tossed out by Mayor Lee against Mirkarimi as they were by Supervisor Wiener against Wolfe to see if they would “stick.” Then, both the Ethics Commission (in Mirkarimi’s case) and the full Board of Supervisors (in the Bruce Wolfe case) simply made up processes along the way to wrongly remove political opponents.

It’s a sad state of affairs when complaints have to be filed with the FPPC to obtain accurate Form 700 Statements of Economic Activity from SOTF appointees. It’s also sad that another member of the community had to file a complaint against Supervisor Wiener with the State Bar of California for possible violations of ethical codes of conduct required of lawyers. The State bar complaint involves the SOTF’s September 3, 2011 official misconduct finding referred to San Francisco’s Ethics Commission regarding Wiener’s role in the Parkmerced development deal. The complaint asks the State bar to investigate whether Wiener violated Business and Professional Code sections 6128 and 6068 that prohibit all lawyers in California from providing false statements and prohibits all forms of deceit (including selective presentation of incomplete facts).

While many — including Bruce Wolfe — try to do the right thing to protect the rights of citizens to know what our government is up to, there are powerful forces and people such as Wiener for whom truth and transparency appear to be inconvenient, and who may prefer to deny access to either. Now is the time to pay attention, and demand that the Board of Supervisors reappoint. Wolfe to the SOTF immediately so the Sunshine Task Force can resume citizen oversight of City Hall.

Monette-Shaw is an open-government accountability advocate, a patient advocate, and a member of California’s First Amendment Coalition. He received the Society of Professional Journalists–Northern California Chapter’s James Madison Freedom of Information Award in the Advocacy category in March 2012. Feedback: Monette-Shaw

September 2012

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