Rezoning Public Land for Residential Housing: Follow the Money

Land Grab for Laguna Honda Hospital’s Campus

Rezoning Public Land for Residential Housing: A Land Grab

Monetizing Laguna Honda Hospital’s Campus

News inadvertently surfaced about plans underway to place residential senior housing on Laguna Honda Hospital’s (LHH) property.

Anyone who’s played the Monopoly board game knows you can’t place homes and hotels on utility and railroad spaces — because they are public infrastructure properties.

D-7 Supervisor Norman Yee’s staff contacted MOHCD about placing “assisted living” and/or RCFE (Residential Care Facilities for the Elderly) units on LHH’s campus on March 13, 2018 just six days after MOHCD pulled all funding from the 250 Laguna Honda senior housing project.

As desperately as the City needs senior housing, this plan should be opposed because it rules out either “assisted living” or “residential care facilities,” both of which are in desperately-needed short supply”

Yee’s rightly concerned about the lack of assisted living facilities and RCFE units throughout San Francisco. As the Westside Observer reported in December 2017, after the San Francisco Health Commission ruled September 5, 2017 CPMC’s planned closure of St. Luke’s Hospital’s skilled nursing and sub-acute units would have a detrimental impact on San Franciscans’ healthcare, Supervisors Hillary Ronen and Ahsha Safai introduced a request to hold a hearing on the shortage of skilled nursing and sub-acute facilities in the City.

A week later, the Board of Supervisors held a hearing on September 12 regarding the severe shortage of SNF and sub-acute level of care facilities in-county. During opening remarks Yee threw a wrench in the proceedings claiming he had asked in June 2017 for a hearing “on these issues,” but in fact he had not. Instead, Yee had requested in June to have a hearing to “understand the efforts of City departments regarding institutional housing, particularly assisted living, residential care facilities, and small beds for seniors in San Francisco.” Those are separate issues from the issues of sub-acute and SNF level of care.

Yee's absolutely right that we need more RCFE units in the City to prevent out-of-county patient dumping. Yee shouldn't abandon the need for RCFE beds in favor of the less-politically-messy need to build more senior housing.”

Yee should focus his efforts on the shortage of assisted living and RCFE facilities, because offering senior housing is not a reasonable or humane substitute.

Documents Relating to the Proposed Housing on LHH’s Campus

On March 13 Yee’s aide, Jarlene Choy, e-mailed employees in the Department of Public Health, MOHCD, San Francisco’s Human Services Agency, and San Francisco’s Department of Aging and Adult Services,” writing:

“I wanted to inform you that Sup Yee will be announcing today at the Full Board that he will form an RCFE Working Group and would like each of your Depts to participate in the discussions. The purpose and goals are … to retain and build a more sustainable supply of affordable and quality RCFEs.”

The next day Chan e-mailed Yee’s aide, Nick Pagoulatos, saying Laguna Honda Hospital’s campus “is zoned ‘P,’ so [it will] likely need to re-zone[d] for housing.”

Planning Code § 211.2(c) explicitly states: “Additionally, on property with a P District designation that the City and County of San Francisco owns, any use not otherwise principally permitted in a P district as set forth in Section 211.1 of this Code shall be permitted with Conditional Use authorization, except for: § 211.2(c)(1) Residential uses …” The Planning Code is clear, residential housing can’t be placed on parcels zoned “P – Public,” not even as a conditional use.

Chan also wrote “it’s possible” the 2002 EIR for the entire Laguna Honda Hospital rebuild “can be amended, but only if what is being proposed is the same as what was studied in the previous EIR.” MOHCD may want to avoid having to perform a new EIR, including increased transportation impacts.

Project Seeks Assemblyman Phil Ting’s Help: Pagoulatos authored a draft document on May 15, 2018 titled “LHH Ting Project Description” submitted for feedback to MOHCD’s Director, Kate Hartley and to Amy Chan, MOHCD’s Director of Policy and Legislative Affairs. Pagoulatos’ first draft proposed:

“The goal is to create a spectrum of housing options for seniors within the footprint of this one project. This means units will serve a range of needs, from those who need assisted living and skilled nursing to those who are capable of independent living. …”

Hartley and Chan proposed revisions to Pagoulatos’ draft. Hartley suggested adding:

“New affordable housing on the hospital grounds could assist in the transition of some Laguna Honda Hospital patients to independent living once their medical crises have abated.”

Hartley’s assuming patients with chronic and progressive medical conditions will outgrow and “abate” their needs for medical-based care. Denying people who can’t access assisted living and RCFE facilities a level of care they may need and prefer — perhaps worsening their morbidity and mortality — is abuse.

Hartley deleted Pagoulatos’ request for a spectrum of housing options, apparently ruling out building either assisted living or RCFE (Residential Care for the Elderly) units on LHH’s campus.

Chan deleted Pagoulatos’ statement the housing project concept was proposing “a six-story building with up to 160 units (a mix of studio and 1-berooms [sic: “bedrooms”]).” How could they pitch a proposal to Assemblyman Ting without knowing how many units are being proposed?

Hartley claimed LHH’s campus isn’t “big enough” :

“This has a big misconception, in that the site itself isn’t big enough to … create a spectrum of housing options for seniors that will serve a range of needs …”

On May 16, Chan responded, ruling out assisted living or an RCFE:

“We want to clarify that MOHCD can only proceed with a feasibility study for independent living for seniors only,” [meaning senior housing]. “We don’t think an assisted living or RCFE model would be feasible.”

On December 4, 2007 San Francisco’s Health Commission adopted a resolution urging acceptance of the August 2, 2007 Anshen+ Allen assisted living report that an RCFE be built on the LHH campus, and that “the buildings should be constructed as [soon as] financing becomes available.”

Hartley also replied June 15 saying: MOHCD has not awarded any funding, the Department of Public Health is not contributing any funding toward a feasibility analysis, MOHCD is prepared to allocate funding for a feasibility analysis “if Senator [sic: Assemblyman] Phil Ting’s Office was likely to award $3.5 million] in predevelopment funding,” and MOHCD may in the future conduct a feasibility analysis for the site.

A response received on June 22 from the Assembly’s Committee on Rules cited language in California’s Legislative Open Records Act (LORA). LORA exempts from disclosure “preliminary drafts, notes, or legislative memoranda,” “correspondence of and to individual Members of the Legislature and their staffs,” and “communications from private citizens to the Legislature.”

The response indicated while LORA provides “a mechanism by which a citizen may inspect an existing legislative record,” LORA “is not a means to request the Legislature to compile information or otherwise create a record …” The Committee on Rules indicated the records request on whether Ting is being asked for a specific supplemental dollar amount towards an MOHCD feasibility study, or whether he is being asked to sponsor some other type of legislation “does not identify or describe any existing legislative record,” so the Committee on Rules is “unbale to respond that part” of the records request.

In other words, Ting is refusing to respond to a basic request of what he’s being asked to do. Why the secrecy? What’s he hiding?

Cart Before the Horse

No feasibility analysis has been conducted for this proposed project. The feasibility study should have been conducted before asking Assemblyman Ting — or any other agency — to shoulder the burden of identifying potential funding sources. Shouldn’t the feasibility analysis be conducted after Supervisor Yee’s RCFE Working Group has concluded developing recommendations on how to address the crisis of the insufficient amount of RCFE facilities in the City? Isn’t all of this the cart before the horse?

On June 4, Hartley noted a feasibility study will ostensibly be conducted, in part focusing on transportation impacts and whether shuttle-bus transportation solutions will be included.

Placing senior housing on the proposed location is even further from public transportation. That would impose an increased burden on elderly seniors to easily access public transportation, because the proposed site on LHH’s campus is far up a daunting, steep slope and hillside, blocks and blocks from the Forest Hill MUNI station.

MOHCD previously indicated affordable housing funding typically cannot be used for on-going operating expenses, such as transportation.

Do As I Say, Not As I Do

Back in June 2006, when patient safety was severely jeopardized at LHH, patient advocates placed Prop. “D” on the ballot to create an LHH Special Use District to limit new facilities on LHH’s campus to healthcare facilities that provide long-term skilled nursing care and certain types of assisted living facilities.

Paid arguments opposing Prop. “D” in the voter guide included one by former City Attorney Louise Renne, who’s paid argument claimed: “It permits private facilities on public lands … in ALL residential neighborhoods.”

Renne campaigned as a reformer trying to drain the LHH swamp of private developers to prevent privatizing use of public land. Over time, her successors appear to be flooding the swamp to preserve a vibrant life for private developer alligators.

How is this not Renne saying, “Do as I say, not what I do,” as if her successors at City Hall are now considering placing private facilities on public land zoned “P”?

Housing on Public Land Is a Land Grab

“No on D” ballot opponents led an aggressive campaign claiming if Prop. “D” passed, it would amount to a land grab by private developers clamoring to acquire city land. It’s ironic that a dozen years later, it’s now somehow OK to allow a land grab to place market-rate housing on LHH’s campus.

As desperately as the City needs senior housing, this plan should be opposed because it rules out either “assisted living” or “residential care facilities,” both of which are in desperately-needed short supply.

If LHH’s property is re-zoned, it may open the door to place massive housing projects on its campus, including market-rate housing there, and other “P”-zoned properties in the City. That’s not what public land has long been intended for. If this door is opened, what will prevent market-rate housing in Golden Gate Park?

Yee’s absolutely right we need more RCFE units in the City to prevent out-of-county patient dumping. Yee shouldn’t abandon the need for RCFE beds in favor of the less-politically-messy need to build more senior housing.

Between the U.S. Census in 2010 and 2017, San Francisco’s population increased by 78,593 people, to 884,363. By 2050 it’s projected to increase to 993,440, another 109,077 people who will place demands on hospital-based City infrastructure as they age.

The LHH campus should be considered a “rainy-day” resource conserved for when the City needs more land zoned as “P – Public” for hospital and medical-related use types as our population increases and hospital-based infrastructure becomes more critical.

Placing senior housing on the same spot that was supposed to house SNF beds will restrict future expansion and preclude placing additional SNF units on the logical site to link to, and provide access into, the rebuilt hospital. It’s clearly, a bait-and-switch.

As early as May 15, Yee’s office indicated to MOHCD his staff “are working proactively with [some D-7 constituents] to ensure that this project has strong neighborhood support,” constituents who may have been told the project will probably involve market-rate housing.

If the door is opened to placing residential housing on LHH’s campus, it will probably not be long before LHH’s front lawn is sold to the highest bidder to build market-rate housing along its frontage facing Laguna Honda Boulevard.

How is monetizing LHH’s campus by re-zoning it to build market-rate housing any different than State Senator Scott Wiener’s failed attempt to re-zone the entire state for higher-density housing under SB 827? Both attempts at re-zoning are simply wrong, disguising land grabs for what they are.

Supervisor Yee may be seeking a legacy senior housing was developed in D-7 during his watch. He shouldn’t be selling his soul — or legacy — pitting senior housing against the need for RCFE and assisted living facilities, forfeiting public land for market-rate housing. His legacy should be getting RCFE and assisted living facilities built in the City, particularly on LHH’s campus. Perhaps he could enlist former City Attorney Louise Renne to help get this done.

LHH’s campus should not be a spot on a Monopoly board game, or a swamp for market-rate housing developer alligators.

An expanded version of this article, with hyperlinks, and additional discussion is available on the author’s web site at stopLHHdownsize.com.

Monette-Shaw is a columnist for San Francisco’s Westside Observer newspaper, and a member of the California First Amendment Coalition (FAC) and the ACLU. He operates stopLHHdownsize.com. Contact him at monette-shaw@westsideobserver.com.

July 2018

The $310 Million Housing Bond

Affordable Housing Bond Continuing Oddities

Changes to planned spending have plagued the affordable housing bond ever since voters passed the bond in November 2015. The history of the changes is remarkable.

Housing Bond Purposes Change Again

Between November 2017 and May 2018, the number of affordable housing units in the $100 million “Low-Income Housing” main sub-category is dropping by 246 units, a negative 38.7 percentage change cut.”

As of May 2018, there are even more changes.

On July 28, 2016 the Mayor’s Office of Housing and Community Development (MOHCD) informed the Citizens’ General Obligation Bond Oversight Committee (CGOBOC) that between January 2016 and July 2016 MOHCD eliminated both the “Middle-Income Rental Program” and the “Expiring Regulations Preservation” subcategories from the “Middle-Income Housing” main category of bond uses. Three new subcategories appeared on July 28 not previously listed in previous documents describing planned uses. The three new categories were “Middle-Income Teacher Housing,” “Middle-Income Buy-in Program,” and “Middle-Income MOHCD Production,” none previously disclosed by MOHCD.

The Westside Observer reported in March 2017 that by CGOBOC’s October 3, 2016 meeting MOHCD had eliminated the “Middle-Income Buy-in Program” rolled out July 28, 2016, a sub-component of spending that existed for a two-month period.

Like the “Middle-Income Buy-in Program” removed in October 2016, the 250 Laguna Honda senior housing project introduced in January 2017 disappeared from bond spending by November 2017.

Planned spending is changing yet again, six months after MOHCD last presented its bond plans to CGOBOC on November 20, 2017.

Between November 2017 and May 2018, the number of affordable housing units in the $100 million “Low-Income Housing” main sub-category is dropping by 246 units, a negative 38.7 percentage change cut.

As well, the “Teacher Next Door” loans program is cutting support to 190 teachers. The reduction from 250 to 60 Teacher loans represents a negative 76 percentage change cut.

The cut from 64 to 21 units in the “Middle-Income MOHCD Production” category represents a negative 67.2 percentage change reduction.

The combined cuts total an overall 397 reduction of affordable units — from 1,785 to 1,388 — to be funded by this bond represents a negative 22.2 percentage change cut within a six-month period.

Fully $18.92 million is also being shifted from the “Middle-Income MOHCD Production” category to the “DALP” (Down Payment Assistance Loans) category to fund an additional 63 DALP loans, averaging $300,317 DALP loans.

Where’s the Metrics?

As the Westside Observer reported in June 2016, the inaugural hearing on the affordable housing bond held on January 28, 2016 was pathetic, as neither MOHCD nor CGOBOC had thought ahead about what sort of reporting requirements — evaluative “metrics” to report and evaluate various and diverse categories within the bond — would be used by CGOBOC to assess progress on the bond. The reporting metrics hadn’t been developed.

Throughout 2016 and 2017, MOHCD stalled developing in collaboration with CGOBOC any meaningful metrics. Here we are two-and-a-half years after the inaugural CGOBOC hearing in January 2016, and metrics still haven’t been developed. Will CGOBOC insist that the metrics must be defined by November 2018?

Ethics Commission Fines MOHCD’s Previous Director

As reported in April 2015, a January 15, 2015 a press release from then-Mayor Ed Lee summarizing his January 2015 State of the City address claimed he would create a new investment fund to launch more affordable housing projects:

“The Mayor will create an accelerator fund, with private and philanthropic partners, to accompany bond financing, seeding public-private partnerships that will enable nonprofits to act quickly and complete [sic; “compete”] on the open market to purchase land for construction of affordable housing and buildings to be improved as permanently affordable units.”

A 2014 report from the Mayor’s Housing Work Group noted that a “Housing Affordability Fund” — ostensibly separate and distinct from the Housing Trust Fund approved by voters in 2012 — would be established via a public-private partnership. The 2014 report stated the accelerator fund would leverage limited public dollars for housing by pursuing development of the Housing Affordability Fund as an “off balance-sheet” fund.

The City launched the “accelerator” fund on February 2, 2016 naming it the Housing Accelerator Fund (HAF), as a registered 501(c)(3) non-profit organization. It eventually received a $10 million loan, presumably from MOHCD’s larger Housing Trust Fund, not from the $310 million Affordable Housing Bond.

San Francisco’s Campaign and Governmental Conduct Code prohibits City employees from engaging in activities that their city departments have identified as incompatible in a Statement of Incompatible Activities (SIA).

The Mayor’s Office SIA § III(A)(3)(B) provides that the following activity is incompatible and, therefore, prohibited with duties of Mayor’s Office employees:

“No employee who works in the following divisions of the Mayor’s Office — the Mayor’s Office of Housing, the Mayor’s Office of Community Development, or the Mayor’s Office of Criminal Justice — may serve on the Board of Directors of a non-profit organization that applies for loan or grants administered by the employee’s division.”

The Ethics Commission got wind that when the HAF was created, MOHCD’s then-director, Olson Lee, served on the Board of Directors for the HAF from its inception until his retirement on June 2, 2017.

The Ethics Commission entered a “Stipulation” in mid-April 2018 with Mr. Lee. The Stipulation noted:

“[Mr.] Lee should have obtained an Advance Written Determination prior to serving as a board member for the Housing Accelerator Fund [HAF]. Instead, Respondent Lee obtained an Advance Written Determination from Mayor Lee only after Ethics Commission Staff inquired [in October 2016] whether his service on the HAF Board was an incompatible activity under the Mayor’s Office SIA and after having participated in a decision to make a grant to a non-profit organization for which he served as a board member.”

The Stipulation fined Olson Lee a mere $800 for having violated the SIA. Ethics could have fined Lee up to $5,000 for the violation, but just slapped him on the wrist with the reduced fine. As a Department Head who reported directly to then Mayor Ed Lee, Olson Lee should have been keenly aware of the prohibited incompatible activity in which he was engaging.

Homeowners Didn’t Kill 250 Laguna Honda Project

Forest Hill neighbors have been falsely accused of killing the senior housing project proposed for 250 Laguna Honda Boulevard. That’s a complete lie that deserves to be corrected in the public record.

On March 19, 2018, in response to a follow-up records request, MOHCD’s Director, Kate Hartley wrote:

“The reduced footprint required to accommodate both the church and the unstable hillside meant that 250 Laguna Honda was likely no longer a large development but instead average in size (maybe 70 to 80 units). For this size development … MOHCD determined that its money could be better deployed elsewhere.”

It’s a sad day for journalism when a neighborhood newspaper, the Westside Observer, has to correct inaccurate reporting in San Francisco’s mainstream news media outlets, but is happy to do so as a civic duty.

On April 12, 2018, the San Francisco Examiner published an article by Joshua Sabatini that was both inflammatory and factually incorrect. Sabatini wrongly reported:

“The Forest Hill [senior housing] project was scrapped due to neighborhood opposition amid escalating cost concerns and a geotechnical report finding a nearby slope unstable and in need of shoring up — after a $2 million investment from bond funds.”

In response to a records request placed with Kate Hartley at MOHCD the same day Sabatini’s article appeared, Hartley responded “[MOHCD] did not advance any funds to Christian Church Homes [for the 250 Laguna Honda project], nor did we sign a predevelopment loan agreement. We don’t have records responsive to your request.”

MOHCD notified CGOBOC on November 20, 2017 that the $3 million in Prop. A funding for 250 Launa Honda had been re-allocated to another senior housing project at 1296 Shotwell. MOHCD asserted the main reasons for the funding transfer were “delays encountered at 250 Laguna due to the historical findings on the site, the associated environmental approvals, and the extensive community outreach underway.” MOHCD did not cite on November 20 that neighborhood opposition caused the funding re-allocation.

Sabatini should have known before publishing his April 2018 article that MOHCD had already withdrawn Prop. A funding from the project four months-and-a-half earlier in November.

I spoke with Kate Hartley by phone on April 13, 2018. She confirmed the City had not spent one penny of the Affordable Housing Bond on the 250 Laguna Honda senior housing project, so Sabatini’s reporting was factually incorrect. Hartley gave me permission to quote her. She clearly stated:

“Withdrawing from the 250 Laguna Honda Boulevard senior housing project had nothing to do with the neighborhood’s objections.”

Hartley concluded, saying:

“There would likely be regular deposits of hillside debris onto the housing site, even under static conditions, which would have to be removed regularly. To mitigate against these deposits, the building footprint would have to be reduced, further decreasing the potential unit count at the site.”

Obviously, bond funding cannot be used for on-going maintenance or operating expenses such as debris removal for affordable housing projects.

The only report issued by either MOHCD or CGOBOC in March 2018 that Sabatini may have been referring to was the “Accountability Report March 2018” created and released by MOHCD on March 16, a month before Sabatini’s hit piece. Numbered page 26 of MOHCD’s report directly contradicted Sabatini’s claim $2 million of bond funds had been expended on the 250 Laguna Honda project:

“The project at 250 Laguna Honda is no longer moving forward due to cost considerations. No bond funds [from the $310 million Affordable Housing Bond] will be spent on this project.”

More proof neighborhood opposition had nothing to do with MOHCD’s decision to withdraw funding from the 250 Laguna Honda project surfaced in a new lawsuit filed in Alameda County Superior Court on May 17 (Case # RG18905402, Christian Church Homes vs. Philadelphia Indemnity Insurance Company). All of the public excuses MOHCD has offered to date as to why the senior housing project was eliminated from bond spending appears to have been just a pretext to mask the real reasons.

As the Westside Observer reported in March 2018, the El Bethel Arms, Inc. vs. Christian Church Homes lawsuit filed in San Francisco Superior Court appears to have contributed more than we knew about what really killed the 250 Laguna Honda senior housing project.

The Alameda Superior Court lawsuit alleges MOHCD exerted significant pressure on CCH to resolve the El Bethal Arms lawsuit, or risk losing the 250 Laguna Honda project. MOHCD apparently made it clear that if CCH did not resolve the El Bethel Arms lawsuit, CCH would lose the Laguna Honda project outright. MOHCD hasn’t admittedly so, publicly.

As the new Alameda lawsuit advances, watch this space.

When Will Changes to the Affordable Housing Bond Stop?

Here we are approaching three years after voters passed the affordable housing bond in November 2015. When will changes to planned spending of the bond stop? What types of affordable housing will voters eventually get?

And when will CGOBOC get around to insisting that the metrics to evaluate the bond spending must be developed and fully implemented?

An expanded version of this article, with hyperlinks, and additional discussion is available on the author’s web site at stopLHHdownsize.com.

Monette-Shaw is a columnist for San Francisco’s Westside Observer newspaper, and a member of the California First Amendment Coalition (FAC) and the ACLU. He operates stopLHHdownsize.com. Contact him at monette-shaw@westsideobserver.com.

June 2018

Looking at the June 5 Election

My Recommendations

With 15 local, regional, and state propositions and 20 elected officials' contests on the San Francisco municipal and California's primary election ballots, San Franciscans face a minefield determining how to cast their votes on June 5.

This condensed article focuses on a handful of mayoral and Superior Court Judge candidates, and local ballot measures. An expanded version of this article goes into greater detail. Take my clip-and-save cheat sheet to your polling place.

Recommendations for Mayor

I recommend Jane Kim as your first ranked-choice vote and Angela Alioto as your second ranked-choice, for reasons more fully explored in my expanded article. Whatever you do, don't vote for London Breed!

Both measures carry the unfortunate subtitle of "Mostly to Fund" each measure. Instead of Prop D funding housing and homelessness services exclusively, part of the "mostly" conundrum is that the legal text of Prop D says the measure will set aside $3 million, ostensibly to be deposited into the General Fund, for any other public purposes of the City.”

 

Recommendations for Ballot Measures

The "cheat sheet" at the end of this article provides a summary of recommendations. Some discussion is in order.

Regional Measure 3: Bay Area Traffic Relief Plan. This measure is sponsored by the Bay Area [Bridge] Toll Authority. Over a six-year period, bridge tolls in the Bay Area will increase by $3 per bridge crossing, from $5 to $8 for each one-way trip. That's a 60% percent change increase. Assuming a round-trip per bridge increase of $6 dollars per toll bridge for five working days per week for 50 weeks (minus a two-week vacation), drivers will face a $1,500 annual increase in transportation expenses for each round-trip toll bridge crossed. It's not known how many drivers cross more than one toll bridge every day and whether their transportation expenses are even higher.

Background materials posted on the San Francisco Department of Elections web site shows Measure 3 includes $4.5 billion in transportation capital improvements across the region. But a table included summarizing the "biggest investments" account for $1.49 billion in public transit, bicycle, and pedestrian safety improvements, much of it for BART, Caltrain, and MUNI. Another $1.48 billion will be allocated for "traffic bottleneck relief" on various transportation corridors, for a total of almost $3 billion. To learn where the remaining $1.5 billion will be allocated to, you need to read the full 22-page proposal.

The background materials don't indicate whether BART fares, MUNI fares, and ferry service fares will increase. Shouldn't public transit riders help fund the public transit improvements? It will be entirely funded from bridge tolls on the backs of drivers who may have no other transportation alternative options. Vote No on Measure 3.

Prop A: Public Utilities Revenue Bonds. This measure would authorize the San Francisco Public Utilities Commission (PUC) to issue revenue bonds for power facilities; the PUC is currently allowed to issue revenue bonds for water and clean water facilities. The Board of Supervisors would have to approve each revenue bond by a two-thirds vote, along with approval by the Mayor and the PUC Commission. My objection is any of the bonds issued would be subject to ongoing review and oversight by the PUC Revenue Bond Oversight Committee (RBOC). The RBOC has done a terrible job with oversight of existing PUC revenue bonds. Vote No.

Prop B: Prohibiting Appointed (City) Commissioners from Running for Office. Under this City Charter amendment, appointed members who file to run as candidates for state or local elective offices would be required to resign their seats as commissioners. Unfortunately, there is a carve-out whereby appointees to citizen advisory committees would be exempted. Another carve-out would exempt both appointees to the boards of San Francisco's Employees' Retirement System (SFERS), the Health Services Board, and the Retiree Healthcare Trust Fund, along with exempting board members elected by city employees and retirees to these three boards. There are a total of 11 appointees (not elected commissioners) to the three boards chosen by the Mayor, the City Controller, the City Treasurer, and the Executive Director of SFERS; another two are members of the Board of Supervisors who are appointed. One of the two appointed by City supervisors is currently running for elected state office. These 11, and the 8 members elected by City employees and retirees, should not be exempted from having to resign if they choose to seek elected office, while all other commissioners on all of the other City boards and commissions would be required to resign.

The inequity of requiring some board commissioners resign, but exempting others, makes no sense — even if this is San Francisco. I'm personally voting against Prop B because I don't know how commissioners on the three exempted boards can focus on their duties as Commissioners while being distracted for months on end while running campaigns for state or local elected office. With that said, I'm issuing a "No Recommendation" on this measure.

Props C and D: Commercial Landlord Gross Receipts Measures. Both Props C and D would levy additional taxes on gross receipts of commercial property landlords, although some commercial properties for non-profits and other service providers would be exempt from the new taxes.

I'm recommending, very reluctantly, supporting Prop. C for Child Care and Education. Prop C, seeks to raise $146 million annually for child care and education from commercial property landlords. That compares to Prop D, which the City Controller estimates will generate half as much at approximately $70 million. Prop D would be less onerous on commercial property landlords.

Both measures carry the unfortunate subtitle of "Mostly to Fund" each measure. Instead of Prop D funding housing and homelessness services exclusively, part of the "mostly" conundrum is that the legal text of Prop D says the measure will set aside $3 million, ostensibly to be deposited into the General Fund, for any other public purposes of the City.

Worse, the legal text of Prop C would only allocate 85% ($122 million) of the $146 million for child care and education funding, and the other 15% ($22 million) will be deposited into the General Fund for any other public purposes of the City.

The legal text for both C and D provide no clarification, or restrictions, on what the "other public purposes" will include or exclude. Why are both of these measures attempting to fatten up revenue for the City to spend on any "other public purposes"? Why are "other public purposes" being piggy-backed on revenue streams otherwise dedicated to specific purposes?

More concerning, Prop D to raise additional funds for homeless housing and homeless services may not take into account California Assembly Bill 3171, which would allocate $1.5 billion from the state budget to help address the growing statewide homeless crisis if the bill is passed. AB 3171 would also require local jurisdictions to come up with local funds on a matching basis. Where is San Francisco going to come up with even more matching homeless housing funds on top of what the City is already spending, and how much will the local match increase cost? I'm reluctantly recommending Yes on Prop C, and emphatically recommending voting No on Prop D.

Prop E: Prohibiting Tobacco Retailers from Selling Flavored Tobacco Products: The Board of Supervisors passed a measure in 2017 to ban the sale of flavored tobacco in the City. This is more "nanny-state" control of the citizenry. What's next, banning chocolate milk flavored with chocolate? Banning the sale of chicken or baby back ribs, because the meat is "flavored" with sugar-infused barbecue sauce and cooked over potentially carcinogenic coals? Some of my multi-racial family members and former co-workers prefer brands of menthol cigarettes. Banning sale of menthol cigarettes can be seen as being discriminatory to minorities. The City Controller's preliminary statement on the Department of Elections web site indicates the City may well lose sales tax revenue, with people travelling to the suburbs outside the City to buy the flavored tobacco products they prefer. I'm personally voting No on Prop E. But I'm issuing a "No Recommendation" on this measure.

Prop F: City-Funded Legal Services for Residential Tenants in Eviction Lawsuits. This is a no-brainer. The City should help protect all renters and tenants facing eviction lawsuits. The City Controller's preliminary statement on the Department of Elections web site indicates the measure would increase the City's costs somewhere between $4.2 million and $5.6 million, but is subject to decisions made when developing the City's annual budget. Yes on Prop F.

Prop G: Parcel Tax for San Francisco Unified School District. The City Controller's preliminary statement indicates the measure would generate $50 million annually in new tax revenue from the parcel tax to be used principally for teacher salaries and training, and "other" SFUSD purposes. One of those "other" uses would permit the school district to use the revenue for public charter schools. Charter schools are already encroaching on, and competing for, space in public schools.

Teachers in San Francisco were forced to flee to the East Bay, given the City's housing crisis of unaffordable rent. If Regional Measure 3 passes, we'll unleash increased transportation costs of up to $1,500 on teachers annually, assuming they only cross one toll bridge commuting round-trip to teach in San Francisco. Obviously, any salary increase will simply be consumed by increased transportation costs.

This measure could very well set a precedent that parcel taxes can be used to fund salaries of City employees. Who is next? The powerful SEIU nurses' union, Firefighters Local 798, or the really powerful Police Officers Union being inspired by the precedent of a parcel tax for teachers? Who will be the next set of City employees saying "If you can do this for teachers, why can't you do it for me? I need a raise!" Shouldn't the City have to come up with salaries and pay raises from the General Fund? No on Prop G.

Prop H: Policy for the Use of Tasers by SF Police Officers. This Police Officers Association-sponsored measure is ironically titled The Safer Policing Ordinance. Tasers can be just as deadly as bullets from a handgun, so tasers are not "safer." Police officers do not need both guns and tasers. Vote No on Prop H.

Prop I: Relocation of Professional Sports Teams. This is a mere "declaration of policy" that San Francisco will not entice professional sports teams located in other jurisdictions that have previously established themselves for 20 years with community support and fans to relocate to San Francisco. "No Recommendation" on Prop I.

Superior Court Judges

The SF Weekly carried a great article about the Superior Court judges' contests. Public Defenders Phoenix Streets, Maria Elena Evangelista, Kwixuan Hart Maloof, and Niki Judith Solis are running for different seats on the Superior Court, shown on my clip–'n–save cheat sheet to take to the polls with you. I strongly urge you to support all four of them!

Don't Forget to Vote June 5!

An expanded version of this article, with hyperlinks, additional discussion, and the clip–'n–save cheat sheet to take to your polling places is available on the author's web site at stopLHHdownsize.com.

Monette-Shaw is a columnist for San Francisco's Westside Observer newspaper, and a member of the California First Amendment Coalition (FAC) and the ACLU. He operates stopLHHdownsize.com. Contact him at monette-shaw@westsideobserver.com

June 5, 2018 Election Cheat Sheet

Regional Measure 3 Traffic Relief Plan No

Prop. A Public Utilities Revenue Bonds No

Prop. B Appointed Commissioners e

Prop. C Gross Receipts Tax Child Care Yes

Prop. D Gross Receipts Tax Housing &Homeless No

Prop. E Flavored Tobacco Products

Prop. F Tenants Lawyers in Eviction Lawsuits Yes

Prop. G Parcel Tax for School District No

Prop. H Tasers for SF Police Officers No

Prop. I Professional Sports Teams

Mayor Jane Kim (#1) • Angela Alioto (#2)

Superior Court Judge, Seat 4 Phoenix Streets

Superior Court Judge, Seat 7 Maria Elena Evangelista

Superior Court Judge, Seat 9 Kwixuan Hart Maloof

Superior Court Judge, Seat 11 Niki Judith Solis

May 2018

 

Patrick Monette-Shaw

$70 Million in Taxpayer Funds Up in Smoke

When City Employees Violate Bullying Laws, Taxpayers Saddled

Taxpayers funded $70 million in settlement costs for 330 lawsuits filed by city employees against the City during the past 11 years who asserted other employees, supervisors, and managers had been behaving badly.

Taxpayers can't be happy seeing their taxes go up in smoke for entirely preventable behavior involving clearly illegal prohibited personnel practices.

Couldn't that $70 million have been better spent fixing potholes, providing universal pre-school and childcare expenses, preventing the dumping of our elderly and disabled who need skilled nursing care into out-of-county facilities, fixing MUNI, or building more affordable housing?

Public-sector employees behaving badly get away with engaging in prohibited behavior against their co-workers believing that their employer — through the San Francisco City Attorney's Office — will pick up the costs to defend them and pay the settlements”

The term "prohibited personnel practices" refers to behavior banned by existing federal, state, and local laws as unlawful — things such as sexual harassment and sexual discrimination, sexual orientation discrimination, racial discrimination and harassment, age discrimination, disability discrimination, wrongful termination, and other illegal practices.

Whether or not you care about the 330 City employees whose careers were upended because they were forced to sue the City, you may care about what City services went unfunded due to the $70 million legal costs.

While researching data for my February 2018 article "San Francisco's #MeToo Sexual Harassment Scandal" in the Westside Observer about sexual harassment and sexual discrimination lawsuits filed by City employees, it became clear costs of the larger set of prohibited practice lawsuits needed to be revisited. This is the fourth article in a series.

Public-sector employees behaving badly get away with engaging in prohibited behavior against their co-workers believing that their employer — through the San Francisco City Attorney's Office — will pick up the costs to defend them and pay the settlements to aggrieved employees who are harmed. As a condition of employment with the City, shouldn't they be required to comply with existing anti-discrimination laws?

Rising Costs of These Lawsuits

In May 2013, the Westside Observer published my initial article, "High Costs of City Attorney's Advice" — that focused on retaliation and bullying of City employees — in which I reported the City spent at least $12.1 million.

Revisiting the issue three years later in July 2016, the Westside Observer published the first update, "Bullying Costs Soar to $41.6 Million," revealing that by May 29, 2016 costs had ballooned to $41.6 million.

In a second update in April 2017, the Observer published "Slouching Toward Whistleblower Protections." Costs increased from $41.6 million to $58.2 million.

In this third update you are now reading — the fourth article in this series — costs jumped another $11.8 million to now $70 million. The $57.9 million in increased costs between October 24, 2012 and December 22, 2017 (from $12.1 million to $70 million) represents a staggering 478.5% change increase in costs with which taxpayers have been saddled.

What's Ed Lee Got to Do With It?

Part of former Mayor Ed Lee's enduring legacy will be his failure to reduce the costs of lawsuits against the City during his watch over City Hall. In fact, during Lee's watch the number of lawsuits and costs soared.

Of note, between October 25, 2012 and December 22, 2017 — solely within the 5.2 years of Lee's six-year tenure — lawsuits concluded account for $51.4 million (73.5%) of the $70 million in total costs.

Also of note, since January 2007, the $38.4 million in City attorney time and expenses represents 54.8% of the $70 million, while the $31.6 million paid to Plaintiffs represents just 45.2% of total costs, suggesting perhaps the City Attorney is over-litigating, and driving costs up.

It's notable 158 (48%) of the 330 lawsuits concluded to date were filed after Lee became mayor. And 82 lawsuits remaining pending, costs not yet settled.

The total costs of all prohibited personnel practice lawsuits more than doubled, from $22.6 million to $47.5 million, a 110% increase, suggesting Lee did little to reign in increasing violations of existing laws.

Types of Prohibited Personnel Practice Lawsuits

The top six types of cases of the 330 lawsuits concluded ("settled") to date, Wrongful Termination, Racial Discrimination, "Other Actions," Disability Discrimination, Sexual Discrimination, and Sexual Harassment, notably include:

• 250 cases (75.8%) of the 330 lawsuits accounted for $58 million (82.8%) of the $70 million in total costs across the top-six categories.
• 54 cases (16.4%) of the 330 lawsuits involved Wrongful Termination, accounting for just under $20 million (28%) of total costs. Wrongful Termination is clearly under-reported because the City Attorney's office has a habit of misclassifying Wrongful Termination cases as other types of cases.
• 53 cases (16.1%) involved Racial Discrimination, accounting for over 19% of total costs.

• 36 cases (10.9%) between Sexual Harassment and Sexual Discrimination lawsuits accounted for $10 million of total costs.

• The 90 cases of Sexual Harassment, Sexual Discrimination, and Wrongful Termination account for 27.3% of the 330 lawsuits, but a staggering $29.6 million (42.2%) of total costs.

As the Observer reported in "San Francisco's #MeToo Sexual Harassment Scandal" in February, at least 61.8% of the sexual harassment and sexual discrimination cases specifically alleged in court legal briefs that they had experienced retaliation. And of the Wrongful Termination lawsuits, 50% of the Plaintiffs also alleged they experienced retaliation.

The remainder of the 330 cases are equally concerning. How can these behaving-badly employees not know that disability discrimination, age discrimination, racial harassment, sexual orientation discrimination and harassment, and the other types of cases are prohibited by law?

Do Taxpayers Have Any Recourse?

If California's legislature and the U.S. Congress can adopt regulations that those found to have engaged in sexual harassment should have to pay the settlements and costs of legal proceedings out of their own pockets, San Francisco taxpayers should demand that San Francisco's Board of Supervisors do so, too, for every City employee found to have engaged in sexual harassment.

After all, this is not an issue that requires a meet-and-confer session with the City's labor union partners. As a condition of employment with the City, employees must be told that in order to keep their City jobs, they are required to comply with existing anti-discrimination laws, and if they don't or won't, they're out!

California Assemblymember Kevin McCarty (D – Sacramento) introduced AB 1750 on January 3, 2018 to require the State Senate and State Assembly seek reimbursement for any sexual harassment settlements paid by California's Legislature when there is clear evidence of wrongdoing by a legislator.

The U.S. House of Representatives passed a bill on February 6, 2018 requiring members of Congress to pay sexual harassment settlements out of their own pockets.

It's time that taxpayers demand that not only should City employees found guilty of sexual harassment and sexual discrimination have to pay the settlement awards and legal costs themselves, employees found to have violated all of the other prohibited personnel practice categories should also have to pay those costs themselves, too.

This shouldn't be limited just to sexual harassment and sexual discrimination lawsuits. City Hall needs to get serious about making these behaving-badly City employees pay for their misbehavior out of their own pockets! That will be the quickest and most effective way to stop these behaving-badly employees dead in their tracks.

An expanded version of this article with hyperlinks and additional tabular data is available on the author's web site at stopLHHdownsize.com.

Monette-Shaw is a columnist for San Francisco's Westside Observer newspaper, and a member of the California First Amendment Coalition (FAC) and the ACLU. He operates stopLHHdownsize.com. Contact him at monette-shaw@westsideobserver.com.

April 2018

Funds for Affordable Housing Must Be Made Public

Financing 250 Laguna Honda Senior HousingPatrick Monette-Shaw

See March 8 Postscript at end of article reporting breaking news that D-7 Supervisor Norman Yee has withdrawn his support for the senior housing project at 250 Laguna Honda.

In addition to concerns about the 250 Laguna Honda location being in earthquake and landslide hazard zones, and the stability of the hill that neighborhood residents have raised, there are serious concerns about the funding for the proposed senior housing project to be built on the site.

San Franciscans deserve a full explanation of this project's financing.

On March 8, after this article was completed, news broke that Supervisor Norman Yee withdrew his support for the senior housing project at 250 Laguna Honda Boulevard, primarily due to concerns about seismic safety of the hillside. It's unknown whether Yee's support for the project may have been weakened by the salacious details exposed in court during the El Bethel lawsuit.”

Affordable Housing Bond Financing Awarded

After voters passed the "Prop. A" $310 Affordable Housing Bond in November 2015, bond spending became the purview of San Francisco's Citizens' General Obligation Bond Oversight Committee (CGOBOC), charged with holding hearings on progress of all general obligation bond projects.

The Mayor's Office of Housing and Community Development (MOHCD) suddenly added the 250 Laguna Honda project to planned bond spending, informing CGOBOC on January 28, 2017 it had done so, indicating the project would receive $3 million for pre-development.

Average Costs Per Unit

The proposed 150-unit project budgeted at $73.5 million averages $490,000 for the average 535 sq. ft. units, including both "hard costs" (construction only) and "soft costs" (architectural fees, permits, etc.). The initial proposal indicated it would include 42 studios (28%) averaging 382 sq. ft., 107 one-bedroom units (71.3%) averaging 595 sq. ft., and just one 1,051 sq. ft. two-bedroom unit (0.7%) for an on-site building manager.

"Prop. A" Funds Stripped

Nine months after adding the project to bond spending MOHCD changed its mind, notifying CGOBOC in November 2017 the bond funding had been re-allocated to another project.

Because the Laguna Honda project will not receive bond funding, it won't be under CGOBOCs purview. Financing details will be harder to obtain.

Evolving Financing

On January 19, 2018 MOHCD indicated it expects to fund the 250 Laguna project using other MOHCD affordable housing sources, such as Inclusionary Housing fees and Jobs Housing Linkage fees.

Given the Langan draft geotechnical report describing the dangers of the instability of the hill, MOHCD indicated on January 17 it expects the project size will be reduced by one-third — from 150 to 100 units. Once costs for stabilizing the hillside are determined, CCH will provide a revised budget.

When CCH first applied for "Prop A." bond funding, it submitted a project budget, shown in Table 1.

Table 1: Initial Project Budget Submitted by CCH

Notably, Table 1 doesn't include costs to purchase the property. Table 1 reveals fully $71.5 million (97.3%) of the financing will be funded by sources other than from CCH, and $54.2 million (73.8%) doesn't require repayment.

Lien Orders 4 through 7 totals $35.2 million classified as "forgivable" in terms of repayment.

The $31.5 million tax credit equities (42.8% of funding) is clearly of interest to CCH, just as tax credits for re-development of El Bethel Arms was of great interest to CCH.

About Residual Receipts

Kate Hartley, then-Deputy Director of MOHCD, informed CGOBOC members on January 28, 2016 that MOHCD typically doesn't expect repayment of "residual receipts" — revenues received in excess of operating costs — such that if no residual revenue is left over, repayment isn't expected.

Kiss the $19 million in city-issued residual receipt funding goodbye.

As for the $17.3 million in HCD-AHSC residual receipt funding from the State of California, that loan must be repaid in full at the end of the 55 year term of the loan. If the State can require full residual receipt repayment, why can't the City of San Francisco?

About Tax Credit Equity Funding

CCH's reliance that $31.5 million in tax credit equities will actually be secured for the project is uncertain and may be in jeopardy.

MOHCD's Eugene Flannery confirmed January 29 projects applying for MOHCD funding submit an estimated amount of tax credit equity to be obtained. The Low-Income Housing Tax Credit program is administered by the IRS and overseen by California's Tax Credit Allocation Committee (CTCAC).

Once a project sponsor has a tax credit allocation from CTCAC, the sponsor enters into an agreement with a private investor to purchase the credits at a market price. The tax credit equities aren't loans and, therefore, aren't paid back to the corporation or to CTCAC. They're essentially gifts that only require the developer keep the project "affordable" for 55 years.

Presumably, after 55 years the project can be flipped from "affordable" housing to market-rate units. No wonder they're so lucrative to, and coveted by, developers like CCH.

Flannery indicated that during 2016 the local value of tax credits dropped significantly, from $1.15 to 95ȼ per credit — a 17.4% percent decline in value.

What Flannery didn't mention is competition for tax credits is intense, because the credits aren't restricted just to 100% affordable housing projects, they're available to for-profit developers, too.

For-profit developers who are required to include a percentage of their projects as below-market rate (BMR) units in jurisdictions like San Francisco having inclusionary housing minimum percentages are allowed to submit applications for tax credit equity on the BMR units.

One example of this is Axis Development Corporation, a for-profit developer, which obtained multi-family housing revenue housing bond financing from San Francisco's Board of Supervisors in December 2017 for a 117-unit market-rate project at 2675 Folsom Street. The 2675 Folsom deal calls for 20 percent — 23 units — of the 117 to be BMR units.

Axis received $5.3 million in tax credits from CTCAC.

The 50-unit reduction at 250 Laguna Honda will yield less credits than CCH was banking on. CCH will have to compete for tax credits with for-profit developers. MOHCD indicated CCH hasn't applied to CTCAC for the tax credits.

CCHs interest in the tax credit equities for the 250 Laguna project mirrors CCHs interest in tax credit equities for re-development of another project.

El Bethel Baptist Church vs. Christian Church Homes Lawsuit

Tax credit equites are so lucrative that back in 2012 CCH advocated for re-development of El Bethel Arms, a housing project owned by El Bethel Baptist Church, because CCH stood to receive a $2.5 million re-development fee. The proposal sought to sell the Arms to investors for 15 years under a low-income tax credit program.

A series of six contracts were signed by Lillian Peck, an El Bethel Arms board of director's member in her 80's. Peck was allegedly misled into believing the Baptist Church would retain 51% ownership, when in fact the agreements reduced ownership of tax credits to just 1%.

In 2013 Keva McNeill had become El Bethel Church's new pastor and an El Bethel Arms board member. The new Board voted to halt the redevelopment project in March 2016 and terminated CCH as El Bethel Arms' management company.

The six agreements were subsequently challenged in San Francisco Superior Court by El Bethel Church's new Board of Directors, which had been appointed in the summer of 2014. El Bethel Arms, Inc., et al. vs. Christian Church Homes, et al., filed May 11, 2016 [case number CGC-16-551933], seeks to rescind the agreements under breach-of-contract.

On January 16, 2018 San Francisco Superior Court Judge Richard Ulmer issued his tentative decision in Phase I of the El Bethel Arms, Inc., et al. trial that the six agreements could be, and are, rescinded [case number CGC-15-546236]. Ulmer's tentative ruling noted evidence presented at trial "establishes undue influence at the least [on Ms. Peck], if not outright fraud."

Ulmer's tentative decision stemmed from El Bethel's initial May 2016 lawsuit.

According to a knowledgeable observer, it's thought the partial settlement agreements indicate that El Bethel and CCH have completely severed all of their business relationships.

It now appears all six of the contracts Ms. Peck had signed — the four development contracts and the two owner representative agreements "that were intended to illegally take possession of a 355-unit affordable housing property worth $70 million" — have been rescinded, allowing El Bethel Baptist Church to retain ownership of its two housing projects.

The Project's Undoing

After CCH submitted a Preliminary Project Assessment (PPA) application to the Planning Department on July 6, 2016 for the 250 Laguna Honda Project, Planning issued its preliminary response on October 4, 2016 noting the application was valid for 18 months, would expire on April 4, 2018, and a new PPA will be required.

In response to a records request for financial arrangements between CCH and Forest Hill Church, CCH's CEO, Donald Stump, noted Forest Hill Church is selling its property to CCH for less than full market value.

CCH is looking to acquire the 250 Laguna property for below market price of just $3 million to $3.5 million. The sale hasn't occurred. The minimum fair market value of the property is approximately $10 million.

Stump noted CCH has no knowledge what Forest Hill Church will actually do with sale proceeds but asserted the Church has said proceeds will be used to further the Church's mission. If Forest Hill Church really wants to use sale proceeds to further its ministry, why on earth would it sell for below market value, at less than one-third of the full market value?

After CCH's questionable practices in the El Bethel Arms re-development project Judge Ulmer stopped just short of categorizing as fraud, how can San Franciscans trust CCH's plans to develop the project at 250 Laguna Honda?

Hopefully, the 17.4% drop in tax credit equities value to investors, the yet unknown costs to stabilize the hillside behind 250 Laguna, and the 50-unit reduction will kill CCH's plans to develop housing on the site, penciling the project out as financially unfeasible. Why would private investors snap up tax equity credits knowing the property is in landslide and earthquake hazard zones?

This desperately-needed senior housing clearly needs to be moved to a seismically-safe alternative location, and needs full disclosure of the project's financing.

Postscript: Supervisor Yee Withdraws Support for This Senior Housing Project

"News broke on March 5 that Supervisor Norman Yee withdrew his support for the senior housing project at 250 Laguna Honda Boulevard."

On March 8, after this article was completed, news broke that Supervisor Norman Yee withdrew his support for the senior housing project at 250 Laguna Honda Boulevard, primarily due to concerns about seismic safety of the hillside. It's unknown whether Yee's support for the project may have been weakened by the salacious details exposed in court during the El Bethel lawsuit. Yee wrote, in part:

"In light of the totality of these concerns and a limited amount of funding available to see it through to the end of a long and uncertain entitlement process, I am compelled to withdraw my support for this project. I do so with a sense of regret and am grateful to Forest Hill Church and CCH for making the effort to bring a much needed resource to our District."

A possibility exists for another project at the same location, but the same geotechnical concerns remain so any developer will face the same challenges that CCH had faced. MOHCD may still try to push the project through, but the likelihood MOHCD would succeed is extremely low. It's also unknown how CCH may respond to the loss of Yee's support.

An expanded version of this article with hyperlinks is available on the author's web site at stopLHHdownsize.com.

Monette-Shaw is a columnist for San Francisco's Westside Observer newspaper, and a member of the California First Amendment Coalition (FAC) and the ACLU. He operates stopLHHdownsize.com. Contact him at monette-shaw@westsideobserver.com.

March 2018

Time’s Up: City Hall’s Dirty Little Secret

Sexual Harassment in City Government

San Francisco City government is no more immune from sexual harassment scandals than other jurisdictions.The Time’s Up and #MeToo movements need to focus on our City government.Sexual Harrassment photo

The sexual harassment bombshell that exploded around Harvey Weinstein and the entertainment business quickly spread to Washington, D.C. ensnaring Senator Al Franken, among others.It spread to our state legislature in Sacramento, where five sexual harassment settlements cost $950,000 over two decades.

 

In contrast, at least 34 sexual harassment and sexual discrimination lawsuits filed by City employees against the City have cost at least $9.1 million since 2007. City Attorney time and expenses fighting the lawsuits cost $5.2 million (57.2%), and $3.9 million (42.8%) was paid as settlements to plaintiffs.Eight lawsuits remain outstanding, so costs will increase.Another five sexual harassment unlitigated claims added another $565,946, bringing total costs to $9.6 million, and total cases to 39.

Why has San Francisco retained at least 22 (52.4%) of the 42 Defendants accused of sexual harassment or sexual discrimination across the 34 separate lawsuits, who are still on the City’s payroll …”

The Equal Employment Opportunity Commission (EEOC) declared sexual harassment a violation of the Civil Rights Act in 1980.

Why are Civil Rights Act violations tolerated 38 years later in City government? Why has San Francisco retained at least 22 (52.4%) of the 42 Defendants accused of sexual harassment or sexual discrimination across the 34 separate lawsuits, who are still on the City’s payroll rather than being terminated?

“Time’s Up” in San Francisco

San Francisco appears to tolerate sexual harassment. The City has done minimal sexual harassment prevention training.The City must enact a zero-tolerance policy for sexual harassment.

Back on March 8, 2005 San Francisco’s Department of Human Resources (DHR) rolled out its sexual harassment prevention training program for City supervisors and managers.It was a PowerPoint-based presentation made in live training sessions.DHR upgraded and switched on November 20, 2007 to an on-line-based training program.

Effective October 28, 2013, DHR recommended departments require employees provide copies of their certificates of completion for placement in their personnel files.It shouldn’t have taken another six years for the City to require signed certificates.

Unfortunately, DHR confirmed the sexual harassment prevention training program isn’t required for all City employees; non-supervisory employees aren’t required to take the training.

Data presented below were obtained from public records requests to the City Attorney’s Office for lawsuits since 2007 and the City Controller’s payroll database, which were cross-referenced to public records of lawsuits available on the San Francisco Superior Court’s web site.

That 21 (61.8%) of the 34 cases listed “retaliation” as a “cause of action” is really disturbing.

The 34 cases named 40 Plaintiffs, 17 (42.5%) of whom appear to have retained their City jobs, and named at least 42 Defendants, 22 (52.4%) of whom appear to have retained their jobs.Another 7 of the Defendants (16.7%) retired, collecting City pensions.Fully 69% of Defendants continued collecting City salaries or pensions.

These 34 cases represent the tip of the proverbial iceberg, since many City employees may not have the financial means to file lawsuits, or may choose to remain silent to prevent further harassment and retaliation, and retain their employment income.

At least 31 of the 34 lawsuits were filed after the prevention training program was implemented.

Sexual Harassment and Wrongful Termination Nexus

Although wrongful termination lawsuits don’t generate community outrage as sexual harassment lawsuits do, there are parallels between the types of lawsuits.The nexus is retaliation.

Fully 54 wrongful termination lawsuits have been settled since 2005, at a cost of $17.8 million between settlement awards and City Attorney time and expenses fighting the lawsuits.Another 9 wrongful termination cases remain pending, with additional costs to come.Combined with the 39 sexual harassment and discrimination cases, that brings us to a total of 102 lawsuits between the three lawsuit categories.

Of the 54 wrongful termination cases settled, 27 (50.0%) alleged retaliation as a cause of action.Four of the cases involved “free speech” violations.Eight (14.8%) of the 54 wrongful termination cases settled explicitly named retaliation against whistleblowers.

The number of wrongful termination lawsuits jumped from 23 before Ed Lee became mayor to at least 40 after he became mayor in January 2011.That’s a 74% increase in wrongful termination lawsuits during Lee’s “watch.”

A January 8 Baltimore Sun article by Aaron Jordan noted that for the #MeToo moment to last, we must significantly strengthen whistleblower protections.Jordon observed:“we must mold our laws so that the sexual misconduct whistleblowers of tomorrow have less to fear and more to gain from coming forward.”

The nexus between the 102 sexual discrimination, sexual harassment, and wrongful termination lawsuits is that fully 54 (52.9%) explicitly named retaliation as a cause of action.At combined costs of $27.5 million since 2005, these lawsuits cannot simply be ignored, especially not the cases naming retaliation.

Anemic City Efforts

The City’s Whistleblower Protection Ordinance (WPO) is supposed to prevent retaliation against City employees.

In May 2015, San Francisco’s Civil Grand Jury recommended strengthening the WPO.The Ethics Commission developed WPO amendments — including allowing whistleblower complaints to be submitted to external agencies, not just in-house in the City — and in March 2016 and submitted them to the Board of Supervisors, where they have languished for almost two years after Supervisor London Breed latched onto them.The amendments became inactive in October 2017, and Breed had to revive them.The WPO amendments need to be adopted and implemented immediately.

DHR’s “Sexual Harassment Policy” states DHR must submit annual written reports to the Mayor, Board of Supervisors, Human Rights Commission, and Commission on the Status of Women on the number of sexual harassment complaints filed, including the number of complaints pending, and the number of complaints against each City department.

Responding to a records request, DHR failed to provide annual sexual harassment reports.Instead, the Clerk of the Board of Supervisors provided seven DHR annual reports.DHR provided the remaining seven years in quarterly report format, with different data elements in a different format.Some of the data was totally redacted.Piecing the data together shows a staggering 240 complaints were filed across the 14 fiscal years.

Fully 33 (13.8%) of the 240 complaints were filled “externally” with either the U.S. EEOC or California’s DFEH.This is significant because San Francisco’s current WPO doesn’t provide anti-retaliation protections for employees who file complaints with external agencies outside of City government.

Another 41.6% (86) of the 207 internal complaints were classified as “pending.”It’s unknown how pending cases were eventually resolved.And 14.5% (30) of the complaints were classified as “insufficient evidence,” meaning those complaints were investigated, but there was insufficient evidence to establish sexual harassment occurred.And 24.2% (50) of the complaints were classified as “not investigated.”

Most damning, just two — a mere 2% — of the 207 sexual harassment complaints filed internally resulted in terminating the accused.

Separate from its annual reports, DHR asserted it located records of 423 sexual harassment complaints it determined after investigating had no merit and weren’t sustained.

Sadly, although San Francisco’s Commission on the Status of Women (CSOW) receives DHR’s annual and quarterly reports, it appears CSOW hasn’t held any hearings on sexual harassment of City employees in the past five years.

It’s thought City employees alleging sexual harassment, sexual discrimination, and wrongful termination must first submit claims to the City Controller’s Claims Division.Since 2007, the Claims Division received 108 claims across the three categories, and paid just one claim (for sexual harassment).Had the Controller paid more of those claims, perhaps the $26.5 million across the 95 lawsuits filed might have been avoided.

Unfortunately, our Human Rights Commission reported it had no records of DHR’s annual reports.

Zero Tolerance in San Francisco

If the U.S. Congress, State legislatures, broadcast and print media, and entertainment industries can rapidly expel or terminate employees accused of sexual misconduct, why can’t San Francisco, too?

San Francisco should adopt a zero-tolerance policy, and terminate all Defendants found by Courts and juries to have engaged in sexual harassment, sexual discrimination, and wrongful termination of other City employees.

We must stand with victims and survivors of sexual assault.San Francisco city employees should start their own #MeToo-SF-City-Employees Twitter campaign to document the magnitude of this problem in City government.

As Oprah Winfrey implied accepting the Golden Globe’s “Lifetime Achievement Award” on January 7, City employees deserve “leaders who take us to the time when nobody ever has to say ‘Me Too!’ again.”

Or have to say “Time’s Up,” City Hall!

A greatly expanded version of this article with supporting data and hyperlinks is available on the author's web site.

Monette-Shaw is a columnist for San Francisco’s Westside Observer newspaper, and a member of the California First Amendment Coalition (FAC) and the ACLU.He operates stopLHHdownsize.com. Contact him at monette-shaw@westsideobserver.com.

February 2018

Patrick Monette-Shaw 2017

Patrick Monette-Shaw 2016

Patrick Monette-Shaw 2015

Patrick Monette-Shaw 2014

Patrick Monette-Shaw 2013

Patrick Monette-Shaw 2008-12

Earlier Laguna Honda Articles by Patrick Monette-Shaw