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-ShawSt. Luke's Update

Temporary Reprieve From Exile

In September's Westside Observer Dr. Palmer and I addressed whether the proposed closure of sub-acute and skilled nursing units would result in eviction and exile for the 28 current patients at St. Luke's. The September article covered the Board of Supervisors July 26 hearing and the Health Commission's August 15 hearing on closure of St. Luke's units. Since then the Health Commission held a second hearing and the Board of Supervisors also held a second hearing.

CPMC had been adamant the two units would be closed because there was "no room" in either replacement hospital for St. Luke's or CPMCs new Van Ness Avenue hospital to accommodate them.

Those 28 patients were given a temporary reprieve on September 12: CPMC relented and will keep the current patients, at least through June 30, 2018. But CPMC/St. Luke's won't admit any new patients needing sub-acute care, leaving San Francisco with the problem of no sub-acute care facility anywhere else in the City.

Two September Hearings

The Health Commission's second hearing on September 5 was again well attended by family members. Family Council Coordinator Raquel Rivera provided a heartbreaking presentation. Additional testimony was provided by community advocates supporting St. Luke's patients and their families. Many St. Luke's staff and nurses, other physicians, family members, and others also testified.

While those residential care facilities are clearly important, and rapidly vanishing in San Francisco, the difference between medical-based Skilled Nursing Facilities and sub-acute facilities, vs. non-medical residential care facilities is significant. While both settings are clearly necessary, they are not the same issues."

The resolution the Health Commission adopted September 5 noted it was concerned about capacity of SNF and sub-acute facilities for future generations of San Franciscans, and recommended St. Luke's delay discharge of its current SNF and sub-acute patients until alternative facilities were identified. Although its resolution noted closure of St. Luke's units would have a detrimental effect on healthcare for San Franciscans, the Health Commission stopped short of specifying alternative facilities must be located in-county.

A week after the Health Commission hearing, the Board of Supervisors stepped in September 12 and held a "Committee of the Whole" hearing on St. Luke's at the urging of Supervisors Asha Safai and Hillary Ronen.

To everyone's surprise, although CPMC was adamant during the Health Commission's September 5 hearing CPMC would not keep the two St. Luke's units open, the day before the Board of Supervisors hearing CPMC suddenly relented and announced to St. Luke's patients and family members, and to City Supervisors, on September 11 that CPMC would keep both units open, at least until June 2018 — and perhaps for the term of the patients' lives.

During his opening comments on September 12, Supervisor Safai noted the lack of SNF and sub-acute care beds has been a "crisis in the making over the past decade … as we've seen a major, major decrease in the number of skilled nursing beds over the last ten to 15 years."

That's because City Supervisors hadn't been paying attention to the disappearing number of SNF beds as the crisis unfolded.

During opening comments, Supervisor Norman Yee's remarks were worrisome. He indicated he'd asked "for a hearing on these issues" last June, ostensibly referring to SNF and sub-acute level of care facilities.

Yee had not. Instead, Yee asked last June for a hearing to "understand the efforts of City departments regarding institutional housing, particularly assisted living, residential care facilities for the elderly (RCFE), and small beds for seniors in San Francisco." Those are separate issues from the issues of sub-acute and SNF level of care.

While those residential care facilities are clearly important, and rapidly vanishing in San Francisco, the difference between medical-based SNF and sub-acute facilities, vs. non-medical residential care facilities is significant. While both settings are clearly necessary, they are not the same issues.

Director of Public Health Barbara Garcia was asked to comment. She regurgitated the Health Commission's, and Yee's assertion that a "regional solution" should be reached, particularly for sub-acute care — portending even more out-of-county discharges. She indicated she is in conversations with San Mateo County to develop regional solutions. She indicated DPH is working with Dignity Health to develop a sub-acute unit, but only for mental health patients. DPH and the PACC don't appear to be seeking solutions for sub-acute patients without mental health diagnoses.

Supervisor Safai called on David Serrano Sewell, the Hospital Council's regional vice president. Sewell confirmed the PACC is currently only focused on two vulnerable patient populations: 1) Cognitively-impaired post-acute care patients requiring 24/7 supervision, and 2) Behaviorally-challenged/disturbed post-acute care patients

Safai noted the September 12 hearing was specifically to be about "in-county, in-hospital solutions for San Francisco." But the PACCs September 25 meeting minutes documents the PACC continues pursuing out-of-county, regional solutions.

Following public testimony, Supervisor London Breed called on Supervisors to make closing statements. Surprisingly, Supervisor Yee, asked to speak. Yee stated: "Maybe Supervisor Safai was not listening when I was mentioning that I had already asked for a similar hearing."

Yee claimed he was looking for a more "comprehensive" hearing, which is almost comical because the lack of sub-acute care and SNF beds in the City is a complete humanitarian crisis.

That alarmed observers, who worry about splitting the focus from sub-acute and SNF in-county, in-hospital solutions by adding a distinct issue about residential care facilities. The focus should remain on sub-acute and SNF in-county, in-hospital solutions.

Out-of-County Discharges Worsen—Again

Back in April 2016, I wrote another article, Skilled Nursing Bed Shortage Worsens, first presenting out-of-county discharge data from our two public hospitals: LHH and SFGH. That article reported the total out-of-county discharges then stood at 161. On September 11, 2017 DPH provided updated data showing out-of-county discharges then stood at 605 discharges at minimum, excluding private-sector hospital's discharges.

On November 27, DPH released preliminary data from private-sector hospitals pushing the total to 1,381 out-of-county discharges. St. Mary's, St. Francis, and Kaiser hospitals didn't provide their data, which DPH still hopes to obtain, that may push the total even higher.

The Health Commission's "regional solution" will continue to exacerbate out-of-county discharges.

Remarkably, Health Commissioner David Pating, MD noted during the Commission's February 2016 meeting: "I hope we will consider out-of-City and maybe even multi-county [placement] options."

Really? More out-of-county patient dumping, including elderly and disabled San Franciscans desperately needing long-term skilled nursing care?

Upcoming Hearings

To many observers, Supervisor Yee's focus on residential care, not hospital-based SNF care, sounds like a complete rerun, helping to split community advocates by focusing on supportive/residential housing for the mentally ill and behaviorally-challenged patients, while failing to address the dire need for in-county hospital-based SNF beds.

The question is not whether Supervisor Safai listened to Yee. The relevant question is whether Supervisor Yee has not been listening to his constituents who want in-county, in-hospital solutions, not out-of-county patient dumping.

Supervisor Yee's concerns will be heard during a second Public Safety and Neighborhood Services Committee meeting on Thursday, December 7 at 2:30 p.m., to focus on citywide RCFE's and non-medical institutional care and housing.

An expanded version of this article posted on www.stopLHHdownsize.com contains additional details concerning this condensed story.

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.

December 2017

City Sues, But Continues Investing In, Big Oil

Patrick Monette-Shaw

Oh, the irony being handed to Exxon's lawyers: While City Attorney Dennis Herrera is suing five Big Oil companies over global warming effects causing sea level rise in San Francisco, San Francisco's Employees' Retirement System (SFERS) continues to invest in fossil fuel holdings.

What a field day Exxon's lawyers could make over this disconnect!

City Attorney Sues "Big Oil"

San Francisco City Attorney Dennis Herrera's lawsuit filed on September 19 names five "Big Oil" corporations as respondents — including BP (formerly British Petroleum), Chevron Corporation, ConocoPhillips Corporation (Conoco), Exxon Mobil Corporation, and Royal Dutch Shell.

…it seeks a court order requiring defendants to abate global warming-induced sea level rise by funding an abatement program to build sea walls and other infrastructure needed to protect human safety, and public and private property …”

Herrera's lawsuit alleges global warming-induced sea level rise is here, and is causing harm in San Francisco. The lawsuit alleges the named defendants are the five-largest investor-owned fossil fuel corporations in the world. Herrera alleges the defendants did not just simply produce fossil fuels. He further alleges the defendant's portrayal of fossil fuels entailed downplaying mainstream climate science and downplaying global warming risks.

Herrera's lawsuit doesn't seek imposing liability on the defendants. Rather, it seeks a court order requiring defendants to abate global warming-induced seal level rise by funding an abatement program to build sea walls and other infrastructure needed to protect human safety, and public and private property in San Francisco. The lawsuit specifically notes the case involves shifting the abatement costs back onto the companies.

While San Francisco Burns, SFERS' Trustees Fiddle

On April 23, 2013 San Francisco's Board of Supervisors unanimously passed Resolution 126-13 urging SFERS to fully divest from its publicly-traded fossil fuel investments, to do so within five years, and immediately cease any new investments in fossil fuel companies. Here we are four-and-a-half-years later — months from the five-year goal — and SFERS hasn't divested.

The December 9, 2015 SFERS meeting minutes reported that "Larry Barsetti, speaking on behalf of the Veteran Police Officers Association (VPOA), spoke in support of the motion to divest from fossil fuel investments, but urged caution to maximize investment returns to the [Retirement] fund."

The full Board of Supervisors passed a second Resolution on September 12, 2017 again urging SFERS to fully divest its fossil fuel holdings. Two days later, Barsetti sent a letter on behalf of the VPOA to the Board of Supervisors with a copy to Mayor Lee, threatening that the VPOA is fully prepared to "certainly bring a [law] suit against any politician or political body at the slightest hint of a violation of the" [California Constitution prohibiting "tampering" with pension systems under the California Pension Protection Act of 1992].

Barsetti's letter appears to paint with a broad brushstroke that the California Pension Protection Act of 1992 prohibits elected municipal officials from "tampering" with pension systems. But the legislative intent of the 1992 Act was to prevent elected officials from raiding pension funds. The Act specifically provided:

"Section 17(g): The Legislature may by statute continue to prohibit certain investments by a retirement board where it is in the public interest to do so, and provided that the prohibition satisfies the standards of fiduciary care and loyalty required of a retirement board pursuant to this section."

Baby Step Regarding Thermal Coal Restrictions

It took from December 2015 until May 17, 2017 (a year-and-a-half) before SFERS full Board heard any investment restrictions on thermal coal companies. SFERS Board was presented a Staff recommendation on May 17 to place Level III investment restrictions against just nine companies deriving significant revenues from thermal coal mining, and place nine other companies under Level II (shareholder engagement).

Of the nine companies moved to Level III on May 17, 2017 three had already filed for bankruptcy long before: Alpha Natural Resources (August 2015), Arch Coal (January 2016), and Peabody Energy (April 2016).

SFERS' May 17 meeting minutes report Trustee Al Casciato asked whether "ownership" of investments in the 18 thermal coal and fossil fuel companies being moved to Level II or Level III had benefited the Pension Plan. Cagily, Bob Shaw, SFERS Managing Director of Public Equity Markets answered, noting "coal firms have not been additive to the [pension fund] portfolio in the last few years."

It would have been more accurate had Shaw stated the inverse: For the past seven years dating back to 2011, SFERS' coal firm investments have been "subtractive" to the pension fund's ROI. But wait, there's more: SFERS' entire fossil fuel portfolio isn't maximizing investment returns.

SFERS' Other On-Going Fossil Fuel Investment Losses

SFERS' May 17, 2017 meeting minutes also report Trustee Victor Makras introduced a motion regarding full divestment from SFERS' fossil fuel public equity and fixed income holdings, not just its thermal coal holdings. Makras noted on a two-year return basis there had been just 12 fossil fuel investments with gains, and 37 involved losses. Between public equity holdings, fixed income holdings, and private-market equity holdings, SFERS holds $474 million in fossil fuel investments that appear to be losing ROI.

Makras' second May 17 motion hasn't been calendared yet for SFERS consideration, and has languished since.

Between the cost basis and market value, SFERS' oil and gas investments totaled a net loss of $1.5 million in value as of June 30, 2017, with $40.4 million in losses outstripping $38.9 million in gains. Total investments in coal, oil, and gas combined had a net increase of just 0.60%, a meager $2.2 million gain on initial costs of $367.4 million.

The returns on these fossil fuel investments remain dismal.

On August 16, 2017 San Francisco Examiner columnist Robyn Purchia noted that while SFERS clings to its fossil fuel investments, it suffered a $120 million loss in just three months:

"From March 31 to June 30 [2017], the total market value of the pension's fossil fuel equities fell from $442 million to $322 million. … But the dramatic $120 million drop in three months raises an important question: Are these investments helping the pension [fund]?"

SFERS' Trustees have a fiduciary responsibility to divest from fossil fuel precisely because they are not generating ROI to protect retirees' pensions. A $120 million loss over just three months cannot be "helping."

Exxon Lawyers' Glee

If I were I that Exxon lawyer, I'd make great hay that Herrera's lawsuit should be dismissed because SFERS has not only been an investor in investor-owned fossil fuel corporations, SFERS has continued investing despite knowing it wasn't seeing "additive" ROI, but was seeing the inverse — "subtractive" ROI.

As a hypothetical Exxon lawyer, I'd question why SFERS has known for at least the past seven years (or longer) it has been sustaining massive losses on its fossil fuel investment, but SFERS did nothing to mitigate those losses.

Why should taxpayers, and City employees, be footing the bill for SFERS to continue losing massive funds simply to buy a seat at the table, hoping to influence corporate behavior with "shareholder engagement"?

How can the City Attorney be suing Big Fossil Fuel, while the Retirement Board stubbornly continues investing in investor-owned fossil fuel companies like those Herrera is suing? This makes no sense.

The time to act by divesting is now!

An expanded version of this article posted on www.stopLHHdownsize.com contains addition details concerning SFERS' fossil fuel investment losses, and other details.

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.

November 2017

Proposed St. Luke's Hospital Sub-Acute and SNF Units Closure Endangers Everyone

Ruth Cativo testifies before the Health Commission opposing the closure of St. Luke's sub-acute SNF unit where her father is a long-term care patient. Photo: © Courtesy of California Nurses Association; used with permission

CPMC's Shameless Patient Dump

Out-of-county patient dumping of San Franciscans following hospitalization is certain to increase.

San Francisco is poised to lose its only skilled nursing facility (SNF) providing both sub-acute care for patients who need ventilator care, as well as for those who need routine post-acute hospitalization rehabilitation.

St. Luke's, operated by California Pacific Medical Center, announced June 6 it's closing its SNF unit October 31, as there will be "no space" for a skilled nursing facility in either of its two new hospitals (St. Luke's and Cathedral Hill locations).

Why is CPMC's Foundation spending donor's money on movies and free popcorn instead of on patient care? Is this designed to 'market' CPMC as a member of the community, while deciding that sub-acute patients can be exiled and die?”

Licensed for 79 SNF beds, St. Luke's SNF currently has 24 "sub-acute" patients who face out-of-county placement as far away as Sacramento and Los Angeles. Sub-acute skilled nursing care is required for patients who need ventilators or other forms of very complex care to survive. There are no other sub-acute units in the county.

"The closure of St. Luke's Skilled Nursing Unit represents a watershed moment in the history of San Francisco, a moment when many generations of San Franciscans will look back and wonder what happened to the options for persons who need neighborhood-based or local options to 24/7 [skilled] nursing care," Benson Nadell testified to the Health Commission on August 15. Nadell is the program director of San Francisco's Long-Term Care Ombudsman program, a state-administered program.

Nadell says the proposed closure of St. Luke's sub-acute unit would become a sentinel event, which is defined as an "unanticipated event in a healthcare setting resulting in death or serious physical or psychological injury to a patient or patients, not related to the natural course of the patient's illness."

A report from DPH in February 2016, Framing San Francisco's Post-Acute Care Challenge, documented that all private-sector hospitals cited out-of-county placement as necessary to transfer patients from acute care to lower levels of care. All acute care hospitals other than CPMC transfer sub-acute patients out of county, since CPMC does not allow admissions to its sub-acute unit from other hospital systems.

The number of private-sector out-of-county discharges aren't reported, but we know that San Francisco General and Laguna Honda Hospital combined have discharged at least 541 patients, or more, out of county between July 1, 2006 and June 30, 2017.

St. Luke's hasn't reported ethnicities of patients impacted by the proposed unit closures, but family members of patients say that all of the 24 patients in St. Luke's sub-acute unit are people of color.

DPH informed the Health Commission on August 15 that to maintain San Francisco's current skilled nursing facility bed rate as our population ages, the City would need 4,083 licensed SNF beds by 2030, an increase of 1,644 beds over the current supply.

San Francisco's new Dignity Fund, which will be awarded $575 million by July 2026, prohibits spending for hospital-based medical or SNF services.

DPH's February 2016 report noted that because San Francisco is at risk of an inadequate number of SNF beds that a Post-Acute Care Collaborative (PACC) be created to explore options to bring new SNF capacity to market in San Francisco.

The PACC is a private group of hospital administrators. To date, the PACC has stated its solution would involve a "public-private partnership." However, in over 18 months, the PACC has made no offer to use "private funds." There has been no PACC action to solve the severe SNF bed shortage except to describe only what the public sector might do. Apparently, private non-profit hospitals (a.k.a., not San Francisco General), despite their "non-profit" status, are not interested in using their own resources for skilled nursing care.

Dr. Palmer testified to the Board of Supervisors on July 26: "I do not believe any progress has been made on the actions recommended in the 2016 DPH study. I believe DPH has not even met to even begin the process of mitigating the damage that successive closures of hospital-based SNF's in San Francisco have caused, and will continue causing."

The folks who will be most affected are not only the homeless and marginally housed, but any aging person without a very high income in San Francisco who becomes unable to care for themselves at home. "Do we really want to exile the aging to out-of-county facilities because San Francisco cannot take care of them? Because we rubber-stamped closures of SNFs like this?" Palmer asked.

"If St. Luke's closes, anyone who needs a sub-acute SNF ventilator unit will have to die in the ICU or leave the county immediately, because St. Luke's sub-acute unit is the only ventilator-capable facility remaining in the City," Palmer notes.

Family members and healthcare advocates are worried about the potential for transfer trauma to St. Luke's sub-acute patients. Their discharge options are as far away as Los Angeles. "Transfer trauma is a documented affect of the relocation of frail disabled persons: Caregiver relationships are disrupted; the nexus of communications necessary to continuity of care are broken; the person moved from the familiar to the unfamiliar," Nadell testified.

He further testified that when nursing home patients are relocated out of county, family members report that they visit less frequently, and patients spent more time in bed. Most of these patients die within a year, even without terminal diagnoses.

In 1988, San Francisco passed Prop. Q, which explicitly requires that the Health Commission determine whether private hospital reductions in services will have a detrimental effect on the health care of San Franciscans.

On August 15, DPH recommended to the Health Commission that closure of CPMC St. Luke's 79-licensed beds in its sub-acute and SNF units will have a detrimental impact on health care services in San Francisco.

CPMC/Sutter has already removed any mention of St. Luke's post-acute/SNF/sub- acute services from its website, as if those services had never existed, in spite of the fact final closure isn't scheduled until October, and in spite of the fact the Health Commission and Board of Supervisors haven't completed hearings on St. Luke's proposed closure.

CPMC's Foundation recently announced it is sponsoring a "Movies in the Park" series throughout this September, replete with special goodie bags including free popcorn and free fleece blankets for the first 250 attendees at each of the three events. The Recreation and Parks Department has confirmed that CPMC's Foundation has paid $4,263 in park rental fees for the three movie nights.

Michael Lyon, a prominent advocate for elderly and disabled people, notes: "What are these free movies costing you? It's costing you the only hospital unit in San Francisco offering long-term sub-acute care to severely sick people."

Dr. Palmer asks: "Why is CPMC's Foundation spending donor's money on movies and free popcorn instead of on patient care? Is this designed to 'market' CPMC as a member of the community, while deciding that sub-acute patients can be exiled and die?"

To prevent the St. Luke's sub-acute closure from becoming a watershed moment in San Francisco's history and a likely sentinel event, please contact Supervisors Hillary Ronen, Jeff Sheehy, Sandra Lee Fewer, and Ahsha Safai, who will be holding a second Public Safety and Neighborhood Services Committee hearing on St. Luke's Skilled nursing beds in the near future.

Urge the Board of Supervisors to find a legislative solution to keep all of St. Luke's 79 SNF beds, including the sub-acute beds, open in San Francisco!

Dr. Teresa Palmer worked as a Senior Physician Specialist in geriatrics at LHH for 15 years and has practiced medicine in San Francisco for 30 years. Patrick Monette-Shaw has been a Westside Observer columnist for over a decade; Feedback: monette-shaw@westsideobserver.com. The two authors worked together at LHH for almost a decade.

September 2017

Bloat in Patronage Hiring

Mayor's Hiring Spree EscAlates

What follows is data and insights you'll get only in the Westside Observer. You're not going to get this level of detail from reporters at the San Francisco Chronicle.

When Lee was appointed mayor in January 2011, he inherited Newsom's then $6.6 billion FY 2011–2011 City budget midstream. Six months later Lee introduced his own first City budget of $6.8 billion, a modest 4.1% increase, for FY 2011–2012.

Since then, he's been hell bent on a hiring spree.

Nobody expected Lee's successive annual City budgets would skyrocket to a staggering $10.1 billion budget for FY 2017–2018 starting on July 1, 2017 — a whopping $3.5 billion increase — fully a 54% increase over the City budget Lee inherited.


… it doesn't appear that either the Board of Supervisors, or the City Services Auditor unit within the City Controller's Office, is auditing — or is even interested in auditing — this bloat of growing the number of City employees during Ed Lee's watch as mayor. Taxpayers deserve an explanation why Lee's hiring binge hasn't been audited, or when the hiring might stop.”

Between March 2016 and February 2017, the Westside Observer published two articles on the mayor's hiring binge. A third article written in September 2016 was published on this author's web site in January 2017. This article is the fourth in the series, and will be updated annually.

Which brings us back to the question: How much has Mayor Lee's patronage hiring saga worsened?

Lee's Hiring Binge Is Not a "Black Swan" Event

Wikipedia defines "Black Swan" events as a metaphor for occurrences that deviate beyond what is normally expected of a situation, are extremely difficult to predict, and come as a surprise. Black Swan events are typically random and unexpected, and considered outliers.

But Mayor Lee's hiring binge and the major effects it has had on the City's overall budget was not surprising. Those effects were completely predictable, not merely random.

The City Controller's payroll databases for FY 2010–2011 to FY 2016–2017 shows that it's no Black Swan accident the Mayor added fully 7,644 full- and part-time employees since taking office, a 22.5% increase in staff and a 36% increase of $896.9 million in the total City payroll.

4,830 FTE's (or More) and Counting …

FTE's — "full-time equivalent" employees — are calculated by combining multiple part-time employees into an equivalent 1.0 full-time employee. An FTE of 1.0 is equivalent to a full-time worker, while an FTE of 0.5 is a half-time worker.

San Francisco's government sets its authorized FTE level of city employees by adopting both an AAO (Annual Appropriation Ordinance, also known as the City's official budget), and an ASO (Annual Salary Ordinance), the latter of which typically sets the number of FTE's much higher than the authorized and funded FTE's in the City budget. The FTE's set in the ASO are not funded positions, but are available should the City adopt a budget supplemental.

A third method to calculate the number of FTE's is to utilize the City Controller's payroll database that lists all full- and part-time employees in each fiscal year.

In the first article, "Mayor's Hiring Binge vs. Retire Pensions" published in March 2016, the Observer reported that between the budget he had inherited from Newsom in FY 2010–2011 and FY 2014–2015, the Mayor had added 5,139 additional full- and part-time employees, a 15.1% change increase. Two years later, the Controller's payroll database shows Lee added an additional 2,505 full- and part-time employees in just the past two fiscal years, bringing the total of new hires to 7,644 pushing the total number of all employees on the City payroll to 41,627. That now represents a 22.5% change increase since Lee was appointed as mayor when there were just 33,983 employees on the payroll.

There are fully 11,001 more full- and part-time employees (at 41,627) than the authorized FTE headcount of 30,626 in the AAO authorized for FY 2016–2017 that just ended on June 30, 2017.

It is notable that in the one-year period between June 30, 2016 and June 30, 2017, Mayor Lee added another 1,230 full-and part-time employees to the payroll. The $231.2 million increase in total pay during that one-year period represents fully 25.8% of the total $896.9 million payroll increase since he took office.

Glaring Discrepancy in FTE Counts Between AAO and City Controller's Payroll Database

The adopted AAO for FY 2016–2017 showed a budgeted 30,626 FTE's for the fiscal year. The City Controller's payroll database shows the "computed" FTE's for the same fiscal year to be significantly higher.

Although the AAO had capped the number of FTE's for FY 2016–2017 at 30,626, the total number of FTE's calculated from the City Controller's payroll database was significantly higher, by 2,848 FTE's (a 9.3% increase) when overtime and additional "regular hours" are factored in.

Taxpayers were told the City needs 30,626 FTE's to conduct the City's business, but it actually had 33,474 FTE's.

Growth in the "$100,000 Club" Is Also No "Black Swan" Event

When it comes to the obscene increase in the number of City employees earning over $100,000 annually, reasonable people may hope the famous line in Shakespeare's play Romeo and Juliet "A rose by any other name would smell as sweet" might hold true.

Unfortunately the increase in the number of employees earning over $100,000 annually doesn't smell "sweet," it stinks to high heaven, reminiscent of unharvested cabbage rotting in the fields in scorching heat at the end of summer in the countryside where I grew up.

Figure 1 illustrates that the number of employees earning over $100,000 annually since Lee became mayor has skyrocketed to 14,007 at an annual cost of $2 billion, a net increase of three-quarters of a billion dollars since he took office.

The Controller's payroll database shows that for the fiscal year ending June 30, 2017 the now 14,007 employees who earn over $100,000 annually in total pay represent just one-third (33.6%) of the City's 41,627 full- and part-time employees, and hog 59% (fully $2 billion) of the entire City payroll. That leaves the other 27,620 (66.4%, or two-thirds) City employees who earn less than $100,000 annually to fight among themselves for the remaining $1.4 billion of the payroll.

Did the City really need to add 876 employees earning over $200,000 since Lee took office, a 328.1% increase? For that matter, did San Francisco really need to add 221 employees earning over $200,000 in the one-year period between FY 15–6 and FY 16–17?

When Lee took office in 2011, there were just two City employees paid more than $300,000 in base (regular) pay for a combined total of just $642,358. As of the end of June 2017, we now have 14 employees paid over $300,000 in base pay, which now costs us $4.93 million annually.

What Else Is Wrong With This Employment Picture?

Of the 7,644 employee increase between FY 10–11 and FY 16–17, fully 60.6% (4,629) involve employees paid more than $100,000 annually in total pay, who consumed 83% ($743.4 million) of the $896.9 million increase in the total salaries since FY 10–11. By contrast, employees paid less than $100,000 annually represented 39.4% (3,015) of the additional hires, but received just 17% ($153.5 million) of total payroll increase since FY 10–11.

There has been a vast disparity in average annual salaries. The 27,620 (66.4%) of City employees in FY 16–17 who earned less than $100,000 annually averaged just $50,434 in total salaries, while the 14,007 (33.6%) of City employees who earned more than $100,000 had a staggering $143,171 in average total salaries. The inequities in average annual salaries is nothing short of remarkable.

Highest Paid City Employees and Other Concerns

For the second year in a row, "Bill" Coaker, the Chief Investment Officer at the San Francisco Employees' Retirement System (SFERS) was the highest-paid City employee, earning a nearly $20,000 pay raise across a single year, pushing his total salary to $532,413 annually.

The City Controller's FY 2016–2017 payroll database shows three of the City's 14 highest-paid employees are employees of SFERS.

Of interest, Art Wang — now the City's third-highest-paid employee — was promoted to being a managing director at SFERS at some point during FY 2015–2016, but his pay raise of $160,413 to $418,777 didn't catch up to him until the following fiscal year. For his part, SFERS' David Francl — hired during FY 2015–2016 to oversee SFERS' hedge funds investments— is now the eighth-highest-paid City employee.

Four of the 14 highest-paid employees are employees in the Department of Public Health.

There were 14 City employees who worked more than 3,120 hours in "regular time" alone during FY 2016–2017, indicating they racked up 60 hours (or more) per week as "regular time." All 14 were police officers in the Police Department.

But that number worsens when regular hours and overtime hours are combined into "total hours" worked, which reaches 509 such employees. Those 509 employees translate into 823 full-time equivalents (FTE's), at $100.1 million of the City's payroll. There were 18 employees who racked up over 4,000 "total hours" each, indicating they worked close to two full-time jobs apiece.

Where's the Beef (err, the Auditors)?

As the Westside Observer reported in "Who's Auditing Mayor's Hiring Binge" (Feb2017), it doesn't appear that either the Board of Supervisors, or the City Services Auditor unit within the City Controller's Office, is auditing — or is even interested in auditing — this bloat of growing the number of City employees during Ed Lee's watch as mayor. Taxpayers deserve an explanation why Lee's hiring binge hasn't been audited, or when the hiring might stop.

If it walks like a duck, quacks like a duck, and smells like a duck, then it's probably Mayor Lee on a hiring binge. But it's most certainly not a Black Swan.

San Francisco's next election for mayor will be held in November 2019. Lee will have served for eight-and-a-half years at that point. You can expect that during the next two years, Lee will continue his hiring binge as a lame duck, perhaps while singing his swan song.

The full version of this article posted on www.stopLHHdownsize.com contains expanded information, extensive tabular data, and hyperlinks to background material.

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.

September 2017

Oversight Committee Provides Scant OversightPatrick Monette-Shaw

CGOBOC Fails Monitoring Change Orders

San Francisco's Citizens' General Obligation Bond Oversight Committee (CGOBOC) has a performance problem and an image problem. Most San Franciscans have no clue of what this Committee is supposed to do, despite being created by a vote of citizens at the ballot box.

Until a new CSA oversight audit committee is formed, the overwhelmed, understaffed, and overworked CGOBOC committee will never provide true oversight on bond measures.”

Only a handful of citizens currently attend CGOBOC's bi-monthly meetings, derisively called the "usual suspects." That may soon change, because CGOBOC will start broadcasting its meetings on SFGOV-TV Channel 26 beginning July 17, 2017 after being prodded by open government advocates to do so, over opposition of initially-hesitant CGOBOC members. Stay tuned starting July 17, 2017 to learn what CGOBOC does, and how ineffectual it has been since its creation in 2002!

CGOBOC: Overburdened, Understaffed

Oversight and transparency sound great, but how many tasks can a single citizens' committee provide meaningful oversight over?

Bond Oversight Tasks

On March 5, 2002 voters passed Proposition F, the Citizen Oversight of Bond Expenditures Initiative. Prop. F established CGOBOC as a committee of nine members to oversee all general obligation bonds passed by voters.

For most of its now 15-year history overseeing bond spending, CGOBOC has relied mostly on the City Controller's Office, which provides administrative support to the Committee. Only in 2015 did CGOBOC finally use an external auditor to conduct external audits of three bond programs.

When CGOBOC was formed to provide oversight of bond spending, the City had a handful of (or perhaps just one) active general obligation bonds to monitor. Today CGOBOC is charged with oversight of almost a dozen bond measures totaling $3.6 billion in bond funding, for which CGOBOC has been awarded $3.6 million to oversee.

Shoveling Additional Oversight Tasks: CARB

As if the 11 current bonds weren't enough work to effectively monitor, just 17 months after CGOBOC was created in March 2002 the Board of Supervisors voted on July 15, 2003 to place Proposition C on the November 2003 ballot to create the City Services Auditor (CSA) function within the Controller's Office, piling additional oversight responsibilities onto CGOBOC.

When voters passed Prop.C in November 2003 adding that CGBOC serve as a Citizens Audit Review Board (CARB) to review all CSA audits, voters ended up opening Pandora's secrecy box, or a can full of unintended worms.

Over the five-year period between February 28, 2012 and January 18, 2017 the Controller's CSA Unit performed 233 audits. How could the CGOBOC have been expected to have read and digested 233 CSA audits, in addition to overseeing bond expenditures?

The CSA is not meeting requirements established in 2003. CGOBOC is aware reports and analyses required by City Charter Appendix F aren't being conducted by the CSA. Why does this continue?

The City's "3% Solution" Change Order Quagmire

Change orders are a big, big, deal. The main types of change order include: 1A) Design Errors; 1B) Design Omissions; 2) Unforeseen Site Conditions; 3) Client Requests to add, change, or delete scope to the project after design was completed; 4) Code Changes; 5) Quantity Adjustments to incorporate savings; 6) Alternates (a.k.a., "Cost Savings") to incorporate cost savings, and/or additional work submitted as alternates; and 7) Liquidated Damages and Fines (ostensibly against contractors or sub-contractors).

I had no idea DPW may have an internal goal of holding change orders involving design errors and design omissions to just 3% of project costs. It doesn't seem the 3% "solution" ever occurred for errors and omissions!

Change orders have been big deal on a variety of bond-funded projects.

• 2008 and 2012 Neighborhood Parks Bonds: Across the 17 neighborhood parks funded by both bonds completed to date, there has been $14.7 million (10.8%) in change orders across the $136.4 million budgeted for the 17 projects. At least $2.8 million (19.1% of the change orders) were attributed to design errors and design omissions. Another $4 million (27.1% of the change orders) were client-requested changes. The $14.7 million in total change orders could have improved two, three, or more additional neighborhood parks and playgrounds.

To my knowledge, CGOBOC has not examined in-depth park bond change orders. There are 10 more neighborhood parks still to go on the 2012 bond.

CGOBOC should do so, if for no other reason than change orders on the 17 Neighborhood Park bond projects to date have ranged from 3.3% to 45.8% of individual project budgets, suggesting great variability across projects. Five of the 17 have had change orders over 14% of initial project budgets. Isn't that excessive?

• SFGH Rebuild Bond

There's another change order category known as "Base Scope Buyout," in which a Construction Manager/General Contractor (CM/GC) bids subcontract work and purchases materials and equipment, and negotiates prices.

The SFGH replacement hospital project manager presented to CGOBOC in January 2017. The data presented show change orders on the SFGH rebuild are problematic, for many reasons.

First, neither the Quantity Adjustments change order category to incorporate savings from actual quantities installed during construction, nor the Alternates (a.k.a., "cost savings") category were reported to maximize bond proceeds and effect cost savings.

Second, the data presented involved $38.9 million (5.5%) in change orders, including $20.7 million in design errors and design omissions that were lumped together, obscuring how much was attributable to errors versus how much was attributed to omissions.

In 2008, then-Director of Public Health Mitch Katz admitted that when an initial set of poster-sized floor plans was unveiled in SFGH's former main lobby, nurses noticed the floor plans didn't show nursing stations on each floor having patient rooms. Katz admitted they requested a change order to correct the problem. It's unknown whether it was attributed to a "client requested," or a "design omission," change order!

An expenditure and encumbrance table in the project manager's report noted the project involved $159.4 million in soft costs, fully 18% of the $887.4 million project total. It's not known if CGOBOC questioned why the SFGH soft costs, such as professional fees for architects, designers, surveyors, engineers, lawyers, and others, appeared to be excessive.

• Water System Improvement Program (WSIP) Bond – Alameda Siphon No. 4

This project was funded by the WSIP bond. The project's total budget was $39.2 million, and had $6.8 million in change orders, 17.3% of the total budget. CGOBOC should have asked why change orders reached 17.3% of the budget to determine whether the change orders led to reduction in the project's scope.

Failure to Audit Change Orders

CGOBOC's current chairperson, Brian Larkin, may not give a rat's patootie about change orders driving up cost overruns of bond-financed construction projects, but taxpayers funding these bonds certainly do.

CGOBOC's bylaws states in Article I, Section 4, Activities and Powers:

"Section 4 … (5) Review efforts by the City to maximize general obligation bond proceeds by implementing cost-saving measures, including, but not limited to (a) mechanisms designed to reduce the costs of professional fees and site preparation and design, and (b) recommendations regarding the joint use of core facilities and use of cost-effective and efficient reusable facility plans, and (6) commission independent review of the disbursement and expenditure of the proceeds of general obligation bonds approved by voters …"

Since CGOBOC is charged with maximizing bond proceeds, it should be monitoring, if for no other reason, the Quantity Adjustments change order category to incorporate savings from actual quantities installed during construction, and the Alternates (a.k.a., "cost savings") category to incorporate cost savings to maximize bond proceeds. When I researched Laguna Honda Hospital's cost overruns in 2010 there were no change orders in the alternates/cost savings category.

Nor were there any alternates/cost savings change orders on the SFGH rebuild project. DPW and the City appear to have no incentives, or interest, in seeking cost savings on bond-funded projects.

Has CGOBOC Reconsidered Oversight Over Change Orders?

Following its years-long foot-dragging avoiding actively examining how change orders may intersect with CGOBCO's duties to oversee expenditures of bond-funded program, it appears CGOBOC may finally be willing to more closely monitor change orders. It remains to be seen whether CGOBOC actually will.

When asked whether CGOBOC has any serious intention of ever monitoring change orders on each bond-funded project, one source noted that this reticence has been addressed and now has the full support of all CGOBOC members. We'll see.

Where Do We Go From Here?

It appears doubtful CGOBOC ever asked itself: "Why are change orders for bond-funded construction projects such a large percentage of total project costs?"

Taxpayers should demand a new citizens' committee be created to provide oversight and advice on the City Services Auditor function, so CGOBOC can return to focusing exclusively on of bond measure oversight. CGOBOC simply cannot perform both oversight roles effectively. CGOBOC must actively start investigating change orders in detail. Until a new CSA oversight audit committee is formed, the overwhelmed, understaffed, and overworked CGOBOC committee will never provide true oversight on bond measures.

Fifteen years after it was created, CGOBOC has yet to develop a standard template for bond-project quarterly reports, including reporting change orders. During CGOBOC's May 25 meeting, Controller Rosenfield claimed a template is being developed, perhaps using the 2011 Road Repaving bond presentation last March that included change orders. That's problematic, because the RRSS bond presentation condensed reporting nine different types of change orders into just four categories, and excluded reporting change orders for two of the bond's sub-projects.

On June 23, Peg Stevenson, City Performance Director in the Controller's office, replied to another records request, indicating "no new template has been worked on or proposed," and opined that the 2012 Neighborhood Parks bond quarterly report presented May 17 has the "common consistently used format and elements." That's nonsense: The Parks bond May 17 report contained not one word about change orders! Which is it: A template "is being developed," or "no new template has been proposed"? The Controller's Office can't have it both ways!

This calls into question whether another Grand Jury should be convened to follow up examining what the 2012–2013 Grand Jury explored about only being able to manage what you measure. Until CGOBOC aggressively measures change orders, it can't manage them. Although the Grand Jury recommended benchmarking of San Francisco City departments against comparable cities, benchmarking appears to still not being done — five years later. It's clear if CGOBOC isn't measuring, monitoring, or benchmarking bond-funded change orders, it is incapable of managing them. CGOBOC should ask the City Services Auditor to benchmark San Francisco's change orders to other jurisdictions!

Hopefully, a future Grand Jury may use reporting in this article to launch a whole new inquiry long overdue, and sorely needed.

The full version of this article posted on www.stopLHHdownsize.com contains expanded information and active hyperlinks to background material.

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/August 2017

Pitting Neighbor Against Neighbor for Affordable Housing

Sanctuary City for Housing Developers

As the debate intensified over what percentage of inclusionary affordable housing must be included in proposed developments, one proposal authored by Supervisors Ahsha Safai, London Breed, and Katy Tang proposed reducing on-site affordable rental units in construction projects building 25 or more dwellings to 18%. A competing proposal from Supervisors Aaron Peskin and Jane Kim sought to keep the required number at 24%.

That prompted an astute member of the public to testify during the Supervisors Land Use Committee hearing on May 15 that voters didn't pass Prop "C" in 2016 to allow developers to build the remaining 82% of units as market-rate rental units.

…the Peskin-Kim proposal expands housing opportunities for both low-income and middle-income households, and the Safai-Breed-Tang proposal reduces one category in order to expand the other category of household incomes."

Indeed, voters passed Prop. "C" in 2016 by a whopping 67.9%. Voters spoke resoundingly to double the requirement of 12% on-site affordable housing units to 25%, with 15% affordable to low-income households and another 10% affordable to middle-income households.

The dueling proposals have quibbled over whether developers will be able to devote 75% vs. 82% of new construction to market-rate housing to increase their bottom-line profits. Obviously, developers want the higher percentage — and Safai, Breed, and Tang are happy to oblige.

In exchange for requiring private developers of new market-rate housing projects of 25 or more units to double affordable housing provisions to 25%, Prop. "C" was contingent on granting authorization to the Board of Supervisors to set affordable housing requirements in a "trailing ordinance" to remove inclusionary housing requirements from the City charter.

Skullduggery at the Board of Supervisors soon commenced. The City Controller's Statement on Prop. "C" in the June 2016 voter guide fretted about the potential loss in property tax revenues should developers face restrictions on market-rate housing. Apparently, Controller Ben Rosenfield was more concerned about the reduction in property tax revenues resulting from lower taxes on assessed values of lower-priced units, than developing inclusionary affordable housing units for actual people.

It's very clear Mayor Ed Lee and Rosenfield want to create a Sanctuary City for Housing Developers to help them maximize their housing project profits, in part to help the City's property tax base.

Showdown at the OK Corral: Two Competing Housing Proposals

Proposition "C" in 2016 was tied to a requirement the City Controller perform an analysis of the threshold of inclusionary housing percentages that might affect production of market-rate housing, and required the analysis be provided to the Board of Supervisors.

As the Westside Observer reported last March in Housing Bond Lurches Down a Cliff, the City Controller released his first inclusionary housing advisory analysis in February and submitted it to the Board of Supervisors. The San Francisco Examiner reported on February 15 the Board's discussion was postponed to February 28.

The Board's discussion languished for over two months and the two competing proposals to revise the percentage were first heard by the Land Use and Transportation subcommittee on May 15.

Back on March 23, 2017 noted housing experts Peter Cohen and Fernando Marti, co-directors of San Francisco's Council of Community Housing Organizations (CCHO), published an article on 48Hills.org. The two men noted there's a big difference between what Peskin and Kim want, versus what Safai and Breed want, and there are many nuances between the two proposals. Importantly the pair noted only the Peskin-Kim proposal expands housing opportunities for both low-income and middle-income households, and the Safai-Breed-Tang proposal reduces one category in order to expand the other category of household incomes. That's pitting one income level against another, or pitting neighbor against San Francisco neighbor.

A side-by-side comparison of the Peskin-Kim vs. Safai-Breed-Tang competing proposals as of May 15 is instructive but too detailed for this article.

The competing proposals were continued to the Land Use Committee's May 22 meeting in order to continue negotiations between the competing proposals.

"Sanctuary" to Maximize Profits

The Mayor's Office of Housing and Community Development (MOHCD) FY 2014–2015 annual report included an unnumbered table comparing Area Median Income (AMI) levels to affordable housing sales prices. The table shows for each 20% increase in AMI levels, developers stand to earn an additional $94,000 on each unit sold. That's a lot of incentive for developers seeking sanctuary to market housing units to higher income households by increasing the AMI thresholds.

Commendably, the Coalition for San Francisco Neighborhoods (CSFN) submitted testimony to the Supervisors and to the Planning Commission regarding the battle over the two competing inclusionary housing percentages proposals.

CSFN's testimony noted the Safai-Breed-Tang proposal places more emphasis on middle-income housing, but would result in the displacement of equally-worthy low- and lower-income households who have greater needs than middle-income households. CSFN noted such a major policy change would pit low- and lower-income San Franciscans against San Franciscans with higher incomes, and suggested this policy change should not be undertaken without a more comprehensive review and a vote of the electorate.

Housing Production Performance

The Regional Housing Needs Assessment (RHNA) process is a state mandate regarding planning for housing, requiring all jurisdictions update the Housing Elements of their General Plans. The Association of Bay Area Governments (ABAG) sets San Francisco's RHNA goals.

ABAG issued recommendations for the 2007–2014 period. San Francisco ended up building housing far differently than what ABAG had recommended. For the "Low-Income" category, only half of what ABAG recommended (just 8.1%), built just one-third (6.3%) of the 19% recommended be dedicated to "Moderate-Income" households, and built a staggering 23.5% more than recommended for construction of "Above Moderate-Income" households.

An alternative RHNA report provided by San Francisco's Planning Department illustrates disturbing information: San Francisco built 108.7% of the RHNA Allocation Goal for "Above-Moderate" households, built 62.5% of the goal for "Very-Low Income" households, built just 30% of the allocation goal for "Low-Income" households, and built only 19% of the goal for "Moderate-Income" households.

Unfortunately, Planning Department RHNA reports don't document what proportion of the "Above Moderate" housing goals or actual housing constructed went to "Upper Income" households earning more than 150% of AMIs. The "Upper Income" category is probably all market-rate housing units, and perhaps a good chunk of the "Above Moderate" units may also be market-rate units.

Then there's the issue of RHNA goals that weren't met in the eight-year period between 2007 and 2014. Fully 10,738, or 34.4%, of units weren't built. Why aren't those unmet goals rolled over and added onto the subsequent eight-year reporting period for 2015–2022? Or does ABAG simply "forgive" the municipality for not having built those units, and everyone simply forgets RHNA goals weren't met?

Another potential problem involves deed restrictions. Fully 1,877 (9.2%) of the units in the combined "Very Low," "Low," and "Moderate" income units constructed don't have "affordable income limit" deed restrictions. Years from now (or even sooner), those units that don't have deed restrictions to maintain them as affordable units may face rent increases and may end up becoming market-rate units.

Deed-restricted units are legally bound to rent or sell to households under income limits at a price to guarantee affordability of those units for a minimum time period, usually 55 years.

Notably, neither the "Above Moderate" and "Upper Income" income levels face deed restrictions to set sales prices that are "affordable" and they are not guaranteed to be affordable. It's clear developers are looking for the sky's-the-limit at setting market-rate sales prices!

The Sudden Inclusionary Housing "Deal"

The dueling proposals for Inclusionary Housing amendments purportedly reached a "deal" on Wednesday, May 17 reported in the San Francisco Examiner on Friday, May 19.

Unfortunately, the actual "compromise" legislation wasn't posted online in advance of its Land Use Committee hearing on May 22. Lacking both a Legislative Analysis and the actual compromise legislation itself, there was no way to confirm or analyze details of the proposed "deal" prior to the deadline to submit this article for publication in the Westside Observer.

The Examiner reported the "deal" would require "developers of large rental projects with at least 25 units who choose to build affordable housing on-site would be required to designate 18% of units as affordable," and that number would grow to 19% in 2018 and then gradually grow an additional 5% to 24% by 2027.

Great! We'll only have to wait another decade to get back up to the 24% of affordable on-site units of the Peskin-Kim proposal. That's another decade for developers to make another ___-load of profits!

The Examiner's article noted the "deal" reached would decrease the percentage of affordable housing developers must build on-site under Prop. "C", "except for in the two neighborhoods most impacted by the housing crisis until further study." The Examiner didn't indicate which two neighborhoods might be exempted.

One reasonable question is: How much affordable housing will be lost during the 10-year period it takes to move the dial back up to 24% for rental housing in 2027? The Examiner reported no details about sales (ownership) units, or how the "deal" may have reached compromises on ownership units.

The Examiner concluded saying the revised "proposal is expected to reach the Land Use and Transportation Committee on Monday and the full Board of Supervisors for a vote Tuesday." (May 23)

Committee Hearing (May 22, 2017)

The legal language of the compromise amendments to the inclusionary housing ordinance wasn't online for members of the public to examine 72 hours in advance of the Land Use hearing May 22 in order to adequately understand and prepare testimony regarding the proposed new "deal."

Committee Chair Supervisor Farrell admitted there had been "massive changes" and the Ordinance may now be 40 pages long, none of which were made public.

Farrell ended up continuing the single, compromise inclusionary housing proposal. Now the public will have time to see the single consolidated version of the combined "deal," and there will be time to post both a Legislative Analysis and the final legislation online prior to June 5.

Several people who testified on May 22 noted the inclusionary legislation we've had for 15 years would become moot, given the HOME-SF legislation proposed by Supervisor Katy Tang and the Mayor since housing developers will likely opt to use the less stringent HOME-SF formulas for density bonuses rather than comply with the Inclusionary Housing Ordinance.

CSFN president George Wooding's article in the May 2017 Westside ObserverTang's Radical Housing Proposal — was right on target, warning Tang's HOME-SF proposal is toxic, pitting middle-income against lower-income households!

Peter Cohen, co-director of CCHO, testified, in part: "We are concerned that we have a separate inclusionary [affordable housing] ordinance that is not consistent with that [HOME-SF]. So we do ask that these two mirror each other. If 'inclusionary' [goals] is not embedded in HOME-SF, at least they should mirror each other."

Granting Developers "Sanctuary"s

Are we granting developers "sanctuary" from building affordable housing? And are we granting them sanctuary to reap as many profits as they can eke out over the next ten years?

There's a final clue about development of affordable housing from the Housing Balance Reports Supervisor Jane Kim managed to require be provided from the Planning Department every six months.

Since the first Housing Balance Report in July 2015, the percentage of net new affordable housing produced has plummeted from 30% to just 22% across an essentially two-year period and five housing balance reports. The projected housing balance citywide still stands at just 14%.

It's clear that when developers are left to their own devices, they have little interest in developing new affordable housing and prefer to pay the in-lieu fee rather than building new affordable housing.

It appears the Board of Supervisors caved in to the Safai-Breed-Tang deal, and the "consensus" deal reached will hand developers their 82% license to build more and more market-rate housing, at least for the majority of the next decade through 2027. Take that to the "anti-gentrification" bank.

We'll have to see, when Land Use takes up this issue again on June 5.

Do we want to be a "Sanctuary City for Developers" to maximize their profits? Or do we want to be a Sanctuary City for all San Franciscans seeking affordable housing, without pitting neighbor against neighbor?

Contact the Board of Supervisors and urge them to increase inclusionary affordable housing requirements now, don't wait until 2027 to do so.

Monette-Shaw harbors no presumption of being a public policy or housing subject-matter expert. As a columnist, he has many First Amendment opinions on housing.

The full version of this article posted on www.stopLHHdownsize.com contains expanded information.

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. Contact him at monette-shaw@westsideobserver.com.

Patrick Monette-ShawRemembering Laguna Honda Hospital’s Sister Miriam Walsh

Where’s Our Torchbearer for the Elderly?

Elderly San Franciscans are in dire need of a new torchbearer.

Sister Miriam Walsh, Laguna Honda Hospital’s Pastoral Care Director for 30 years, passed away December 3, 2009 following an extended illness.

As the Westside Observer reported in “Laguna Honda's Torchbearer, Sister Miriam Walsh” in February 2010, a Laguna Honda resident nominated her to the 1996 Olympic Torch Relay Committee for giving generously to the community. She was chosen to help carry the torch through San Francisco.

Miriam believed our society has an obligation to care for the elderly and disabled. She taught us the appropriate response to injustice is to actively resist, inaction never being appropriate.

Sister would be appalled by the current state of affairs in San Francisco. We desperately need a new torchbearer.

Disturbing Trends

The November 2004 West Portal Monthly newspaper published a letter-to-the-editor from Dr. Maria Rivero, the then-attending physician on LHH’s Admitting Ward. Rivero wrote, in part:

“Instead of caring primarily for the elderly and disabled poor of San Francisco, Dr. Mitchell Katz, the Director of [Public] Health, wants Laguna Honda to do ‘social rehabilitation for the urban poor.’

As a result, frail elderly, disabled, ill and dying San Franciscans may be displaced to out of county facilities while more dangerous and robust clients may be housed at Laguna Honda for ‘social rehabilitation’.”

The Department of Public Health has refused to report additional out-of-county discharges that occurred between July 1, 2006 and June 30, 2012. ... Given probable availability of this data, DAAS and DPH should provide the number of patients discharged out-of-county …”

Matters have worsened since 2004.

Out-of-County Patient Dumping

As the Westside Observer reported last March, between July 1, 2012 and December 31, 2016 our county hospitals — LHH and SFGH — have discharged at least 260 patients out-of-county.

The Department of Public Health (DPH) has refused to report additional out-of-county discharges that occurred between July 1, 2006 and June 30, 2012. Miriam would have found this disturbing, too, an unethical response to injustice.

Given probable availability of this data, DAAS and DPH should provide the number of patients discharged out-of-county during those six years.

Long-Term Care Coordinating Council and Community Living Fund

In November 2004, then-Mayor Gavin Newsom created a 41-member Long-Term Care Coordinating Council (LTCCC) to improve coordination of home, community-based, and institutional services for older adults and adults with disabilities.

Two years and three months later, the LTCCC pushed the City into launching a “Community Living Fund” (CLF) program in February 2007 to fund “community placement alternatives, including programs and services provided in an individual’s home, programs and services provided in assisted living facilities, supportive housing and, congregate housing; and to provide care and support for individuals who may otherwise require care within an institution.” Top priority was to have been given to residents of LHH, and SFGH patients being diverted from admission to LHH.

From the outset, the LTCCC has displayed outright hostility to funding institutional settings such as LHH. Over the years it has done nothing to advocate for elderly and disabled people who prefer nursing home placement in-county.

The CLF has been awarded approximately $40.3 million since 2007 through June 2017.

Community Living Fund Client Satisfaction Survey Data

The most-recently released CLF Client Satisfaction Survey conducted by the Institute on Aging (IOA) is from June 2015.

The Telephone Interview and Mail Survey sample started with 178 CLF clients. DAAS claimed a 74% response rate, but appears to have included only 60 interviews. If 60 people completed an interview from a pool of 178, that represents a 34% response rate, not 74%.

Survey data results paint a disturbing picture. Of the 60 survey responses:

• 7% said overall services didn’t meet their needs, while 62% indicated their needs had been met “to some extent.” Just 26% said services met their needs.

• 7% said services did not help them maintain or improve their quality of life, while 69% indicated services had helped “to some extent.” Just 21% said services had helped maintain or improve their quality of life.

• 5% of respondents said services had not helped stay in their home, while 71% indicated services had helped “to some extent.” Only 17% said services had helped them stay in their home.

• The most-damning indicator was 10% of clients wouldn’t recommend the CLF/IOA’s program to friends or family members, while 69% indicated “to some extent” they might. Only 17% responded they would refer friends or family members.

The IOA and CLF hedged their bets justifying these lack of endorsements claiming half of the clients (30) had been enrolled for a year or less and “couldn’t give accurate responses.” To assert clients enrolled for three months or nine months (but not a full year) couldn’t provide accurate responses — or assess whether services received during shorter periods were of use — involves either condescension or outright hubris.

Community Living Fund Quarterly Reports

The CLF is required to provide six-month reports to the Board of Supervisors. The last four reports (a two-year period) aren’t encouraging, since the number of referrals to the CLF from LHH dropped from 44% to 30%. No information was provided about why so many fewer LHH residents were referred to the CLF.

The July–December 2014 report noted lack of housing is the primary barrier to discharge from skilled nursing facilities, so the CLF began limiting assistance to residents with existing housing. Discharge planners at LHH have known since 2005 the most-significant discharge barrier is lack of housing.

The July–December 2015 report indicated a new “Post-Acute Care Project” would identify the number of long-term skilled nursing facility (SNF) residents who could transition to lower levels of care in the community. The Mayor’s LTCCC was charged in 2007 with identifying that number. After eight years, have the LTCCC, DAAS, and the Department of Public Health still been unable to calculate that number?

Re-Admissions to Acute-Care Hospitals

Hospital re-admissions are associated with unfavorable patient outcomes and high costs.

In 2015, DAAS contracted with RTZ Associates to enhance the CLF database to measure the percent of clients with one or fewer admissions to an acute-care hospital within a six-month period.

Per a records request to DAAS, between July and December 2015, 131 of 141 CLF clients (93%) who met an “inclusion” criteria had one or fewer hospitalizations. Of the then-296 CLF clients, 155 (52.4%) didn’t meet the inclusion criteria; their hospitalizations weren’t reported. DAAS didn’t stratify how many were hospitalized once, vs. how many weren’t hospitalized at all. Presumably, 10 of the 141 had more than one hospitalization.

Between January and June 2016, 159 of 178 CLF clients (89%) who met the “inclusion” criteria had one or fewer hospitalizations. Of the then-291 CLF clients, 113 (39%) didn’t meet the inclusion criteria; their hospitalizations also weren’t reported. DAAS didn’t stratify how many were hospitalized once, vs. how many weren’t hospitalized at all. Also presumably, 19 of the 159 had more than one hospitalization.

Across those two periods, the 29 CLF clients hospitalized more than twice are concerning.

When asked how many CLF clients had more than one hospitalization, DAAS lamely replied “This set of criteria is not part of the analysis conducted by DAAS staff.” Shouldn’t DAAS be collecting the number of clients hospitalized twice or more?

Report on Senior Services

In September 2015 Supervisor Aaron Peskin introduced Motion 15-135 directing the BLA to conduct a performance audit of services to seniors. It took 19 months for the audit to be conducted and a hearing held on March 9.

Right out of the gate, the July 2016 BLA report noted a “Service Gap Analysis” hadn’t been performed, despite a City Controller review a decade earlier in 2005. The BLA was crystal clear: Without a gap analysis, the City lacks critical decision-making information.

Remarkably, the BLA’s audit included a Table 1.2, Gap Ratings for Senior Service Areas (Rapid City, SD), which included a category specifically regarding expressed needs for skilled nursing care. If Rapid City can collect gap analysis data, why can’t San Francisco measure gaps here, too?

Lack of Empathy

The absolute hatred exhibited by the LTCCC, CLF, and Dignity Fund of providing skilled nursing care to elderly and disabled people is symptomatic of a lack of empathy for vulnerable patients who may prefer receiving their care in in-county SNF’s.

What organizations fail to measure, they can’t accurately assess. Nor can they fix it, particularly without a gap analysis measuring client preferences. This lack of empathy would have also saddened our Torchbearer, Sister Miriam.

That’s why, in part, San Franciscans are in such dire need of a new torchbearer.

For a full version of this article: www.stopLHHdownsize.com, including discussion about the “Dignity Fund” passed by voters last November.

Monette-Shaw, a columnist for Westside Observer, and a retired City employee, received a James Madison Freedom of Information Award in the “Advocacy” category from the Society of Professional Journalists–Northern California Chapter. Contact: monette-shaw@westsideobserver.com.

May 2017

City Employees Deserve Strengthened Anti-Retaliation Law

Slouching Toward Whistleblower Protections

A fair question to now ask is “Have 33 members of the Board of Supervisors failed to screw in a light bulb during the past 14 years”? Really? How many does it take?

Taxpayers throughout San Francisco have a keen interest in the answer, because it goes to a larger question: Just how much fraud, waste, and abuse has gone undetected due to the Supervisors failure to adopt a meaningful Whistleblower Protection Ordinance (WPO) since 2003?

Grand Jury Raises Over-Arching Issues

In July 2015, the Westside Observer published “Retaliators Keep Their City Jobs, noting the 2014–2015 Grand Jury report, “Whistleblower Protection Ordinance Is in Need of Change.”

In all of these cases, San Francisco City employees have faced great danger, and the costs to the City have been significant, given the bravery it has taken City employees to fight corruption in City government.”

The Jury noted voters enacted proposition C in 2003 adding a mandate to the City Charter requiring the Board of Supervisors to “enact and maintain an ordinance … protecting City officers and employees from retaliation” for filing complaints about improper government activity.

Ethics Commission Sticks Its Toes in the Water

Because the Grand Jury required the Ethics Commission to respond, the Commission waded into the water.

When proposed WPO amendments were heard on March 28, 2016 the Ethics Commission’s new Executive Director, LeeAnn Pelham provided background to Commissioners, with two options for potential amendments.

Option 1 involved minor changes only to Ethics Commissions regulations to become effective 60 days later.

Option 2 recommended amending the Whistleblower Protection Ordinance to:

• Expand the definition of a complaint to include “oral” communications that would be transcribed by the recipient of the complaint into written format.

• Expand the amendments to allow whistleblowers to disclose reports to City agencies other than the complainant’s own City department, and provide anti-retaliation protections to complainants who make disclosures to County, state or federal agencies.

• Expand the WPO to cover anti-retaliation protections for employees of City contractors, in addition to City employees. Pelham specifically noted that amendments to the WPO should provide that employees of contractors could bring forward information about “improper governmental activities” and should receive whistleblower protections.

• Expand the definition of “other adverse employment” actions beyond just termination, demotion, or suspension.

• Add a provision in a new subsection to permit the Commission to issue an order to call for cancellation of retaliatory employment terminations, demotions, suspensions, and other “adverse employment actions” against whistleblowers.

• State explicitly that in order for complainants to establish that retaliation had occurred, the Ethics Commission would determine during administrative proceedings that by the “preponderance of evidence” protected activities had been a substantial motivating factor for adverse employment actions.

Dr. Derek Kerr, whistleblower wrongfully terminated from Laguna Honda Hospital, notes:

Proving retaliation to the Ethics Commission by a ‘preponderance of the evidence’ isn’t feasible because whistleblowers cannot access all the evidence. Unearthing it takes subpoenas and depositions. That’s done by our lawyers in Civil Court, not by Ethics investigators on the City’s payroll.”

The Ethics Commission subsequently forwarded proposed amendments to the WPO to the Board of Supervisors on April 11, 2016.

Gang of Four’s Delay: One Step Forward, Two Steps Back

Once the Board of Supervisors got its hands on the Ethics Commission’s proposed recommendations you could almost predict there would be more delays slouching towards whistleblower protections reform.

The “Gang of Four” includes the Board of Supervisors, City Controller, Department of Human Resources (DHR) and surprisingly, the Ethics Commission itself. There have been no public meetings of the four-agency team to take input or public comment on the proposed revisions to the WPO.

DHR responded March 2, 2017 to a public records request and provided the current working version, as of January 17, 2017, of proposed WPO amendments being collaboratively hammered out by the four agencies.

Comparison of Changes Recommended by Ethics vs. Gang of Four Changes

A side-by-side comparison of proposed WPO amendments submitted by Ethics to the Clerk of the Board and subsequent revised amendments made by the four-agency team is instructive. Major changes to proposed WPO amendments include:

• §4.100 FINDINGS Neither the March 2016 nor January 2017 versions provide anti-retaliation protections if a whistleblower complaint is submitted to private lawyers involved with litigation against the City, to media outlets, other law enforcement agencies, or to watchdog and whistleblower third-party private-sector agencies.

• §4.105(a) COMPLAINTS Although the Ethics Commission expressly included in its March 28, 2016 recommendations to allow complainants to file complaints with other County,State or federal agencies, that provision suddenly vanished from the January 17, 2017 four-agency collaborative proposed revisions to the WPO.

The March 2016 amendments Ethics submitted to the Clerk of the Board had specifically incorporated the Jury’s concern thatgross waste, fraud and abuse of City resources be added to definitions of improper government activity, but gross waste, fraud and abuse waseliminated in the January 2017 version.

• §4.115(a) PROTECTION OF WHISTLEBLOWERS — RETALIATION PROHIBITED Both March 2016 and January 2017 versions of proposed WPO amendments require that complaints have to be filed with City government supervisory employees. This is nonsense, since there are thousands of high-level City managers who don’t directly “supervise” any employees. They’re managers. If a whistleblower files a complaint with a manager who isn’t supervising anyone, will those complainants still face retaliation?

• The Grand Jury noted in footnote 18 of its report that the Board of Supervisors had amended the WPO in 2008 to provide anti-retaliation protections for people who had filed complaints with the City Controller’s Whistleblower Program. Although the March 2016 proposed amendments retained existing language providing anti-retaliation protections to complaints submitted to the Whistleblower Program, the January 27 proposed amendments removed that provision.

• There’s still no explicitly-stated anti-retaliation protections anywhere in §4.115(a) for whistleblower complaints submitted to private lawyers, media outlets, law enforcement agencies, or to watchdog and whistleblower third-party private-sector agencies.

• §4.115(a) also still provides no retaliation protections for City employees who exercise First Amendment free speech rights. San Francisco’s Sunshine Ordinance §67.22(d) currently provides that City employeesshall not be disciplined for expressing their personal opinions on any matter of public concern while not on duty. Sunshine Ordinance §67.22(e) goes further, saying “public employees shall not be discouraged from or disciplined for disclosing any information that is public information or a public record to any journalist or any member of the public.” It’s long past time extant language in Sunshine §67.22(d) and §67.22(e) be replicated as is into WPO §4.115(a).

• §4.115(b)(iii) PROTECTION OF WHISTLEBLOWERS — BURDEN OF ESTABLISHING RETALIATION Neither the March 2016 nor the January 2017 versions of proposed WPO amendments note that the “burden of proof” shall not apply during preliminary review of whistleblower complaints submitted to the Ethics Commission.

§4.115(c)(iv) PROTECTION OF WHISTLEBLOWERS — PENALTIES AND REMEDIES The March 2016 recommendations Ethics submitted to the Clerk of the Board of Supervisorscommendably recommended permitting the Ethics Commission to cancel/reverse retaliatory employment actions against City employees. Remarkably, the January 2017 WPO amendments proposed by the four-agency collaboratorsdeliberately removed Ethics Commission cancellation of retaliatory job actions for City employees, butretained cancellation of retaliatory job actions for employees of City contractors.

§4.115(f) WHISTLEBLOWER PROTECTION AWARENESS TRAINING The new §4.115(f), “Whistleblower Protection Awareness Training in the January 2017 proposed amendments obviously doesn’t go far enough, first because it doesn’t call for re-training of existing employees on changes to the WPO, just training of new-hires. Second, providing “awareness” training isn’t the same as providing “prevention” training. This new section should be revised to require annual on-line training annually forall employees, not just new hires.

Continuing Shortcomings of Proposed WPO Amendments

Larry Bush, principal co-founder of SF’s Friends of Ethics group, notes:

“Friends of Ethics has testified at every Ethics Commission session with the Whistleblower reform on the agenda. We remain concerned that several critical elements still are not included:

There is not a specific requirement that all records (including on private cell phones) be retained regardless of standard retention policies, that all employees and not just supervisors be trained on the rights of whistleblowers, and that there must be an ability to be protected from retaliation regardless of who is informed, including federal and state officials.

It must be recognized that contractors have been forced to engage in unlawful and improper acts by city managers overseeing their contracts, and such incidents must be heard by officials outside the affected agency. We plan to address these issues when the Board holds a hearing on the reforms, something it has not done after nearly a full year of the issue pending at the Board.

Other unresolved major issues include:

Because proposed WPO amendments submitted by Ethics to the Supervisors have been changed by the four-agency team, and many of the recommendations Ethics had proposed to the Board were deleted, the Commission should consider re-instating the deleted recommendations and take those issues directly to the voters at the ballot box.

A major conflict still remains. The proposed WPO amendments still appear to ignore California’s Whistleblower Protection Act, in particular, retaliation prohibited by California Labor Code §1102.5(b). Indeed, Labor Code §1102.5(a) requires employers, in this case, the City itself, may notadopt any rule or regulation preventing employees from disclosing information to a government agency.

There are other unresolved issues described in the full version of this article.

Whistleblower Bravery: $58.2 Million+

In July 2016, the Westside Observer publishedBullying Costs Soar to $41.6 Million” providing an update to previous reporting of costs associated with 27 different types of personnel actions prohibited by law. Between 2007 and May 29, 2016 costs reached $41.6 million to settle 259 lawsuits, plus another 63 cases then still outstanding, for a total of 322 lawsuits.

Since then two other lawsuits brought by employees of the Housing Authority were settled for another $1.3 million, and between May 29, 2016 and March 8, 2017, another 24 lawsuits have been settled for a total of $8 million.Joanne Hoeper’s recently-announced settlement against her wrongful termination by City Attorney Dennis Herrera, and projected costs in City Attorney time and expenses in her case, appear to have added another $7.5 million alone, resulting in a $16.6 million increase just between May 2016 and March 2017, and perhaps higher. Another eight pending cases were added in the same period, with 71 cases still pending.

That gets us up to a minimum of $58.2 million and growing in on-going costs, between the now 286 cases settled to date and 71 lawsuits now still outstanding, for a total of 357 lawsuits, including 57 cases involving wrongful termination.

In all of these cases, City employees have faced great danger, and the costs to the City have been significant, given the bravery it has taken City employees to fight corruption in City government.

Rachel Maddow reported that Russian president Vladimir Putin’s opponent, Alexei Navalny, and Navalny’s “Anti-Corruption Project” involved daring and bravery from leakers and whistleblowers. She noted bravery doesn’t happen in safe places, it happens in the presence of real danger. Danger from retaliation is what City employee whistleblowers face, too.

Just how long is it going to take for City employees to obtain meaningful anti-retaliation protections?

The full version of this article posted on www.stopLHHdownsize.com with expanded reporting in this article.

Monette-Shaw is a columnist for the Westside Observer, and a retired SF City employee. He received a James Madison Freedom of Information Award in the “Advocacy” category from the Society of Professional Journalists–Northern California Chapter in 2012. Contact: monette-shaw@westsideobserver.com.

April 2017

Bait-'n-Switch: Laguna Honda Blvd. Senior Housing

Housing Bond Lurches Down a Cliff

The extent to which voters and taxpayers have been, and continue to be, snookered by Mayor Ed Lee over the Affordable Housing Bond measure should be front-page news. Unfortunately, it's not.

Since starting to cover the $310 million Affordable Housing Bond for the Westside Observer, the scope of planned bond spending has shifted dramatically. The bond appears to be lurching down a cliff.

It's time to speak Truth to Power: Voters were asked in November 2015 to pass a $310 million Affordable Housing Bond measure. They were not asked to pass a nearly $100 million dollar — and growing set-aside — Housing for the Homeless Bond measure. But the latter is what snookered voters will likely wind up getting at the end of the day, part of the bond lurching down the cliff.

The oversight body, the Citizens' General Obligation Bond Oversight Committee (CGOBOC), has done a terrible job so far holding the Mayor's Office of Housing and Community Development (MOHCD) accountable for bond spending. CGOBOC received $310,000, one-tenth of one percent of the gross proceeds of the $310 million Housing Bond, to support CGOBOC, but seems to have done little to earn that allocation.

CGOBOC has heard from MOHCD on the Affordable Housing Bond only four times: January 28, July 28, and October 3 in 2016, and most recently on January 26, 2017. Successive updates from MOHCD keep shifting planned bond uses, and CGOBOC has done little to reign in MOHCD.

Bait–'n–Switch: 250 Laguna Honda

… all neighbors are very concerned about the stability of the hill and construction of the proposed senior housing project, given proposed excavation. Steadman noted that in 1951 a house located at 50 Castenada Avenue directly above the church's current parking lot slid down the hill.”

Although planning for the Affordable Housing Bond began in 2014, and although CGOBOC met three times during 2016 to hear reports from MOHCD about progress on bond spending, almost nobody knew about the proposed 150-unit senior housing project at 250 Laguna Honda until it suddenly appeared in MOHCD's bond update presentation to CGOBOC on January 26, 2017.

Neighborhood Concerns

During CGOBOC's January 2017 meeting, nine neighbors around 250 Laguna Honda testified in opposition — for many good reasons — to this project. First up was John Farrell, a prominent leader on the West Side who noted that like his neighbors, they are not opposed to affordable housing. He rightly noted that the project doesn't take into account the already existing heavy traffic on this portion of Laguna Honda Boulevard. He noted the project would result in the closure of a church, a pre-school, and a childhood development center, all of which provide important services to the surrounding community.

… seniors would have a difficult life on Laguna Honda ... there's no laundromat, no grocery stores, and no pharmacies, and it's a long walk to access public transportation.”

Farrell noted there are legitimate concerns of what impact the project will have on the integrity of the hill behind the project, since construction for the project will excavate the hill. The hill has had landslides in the past. The project was initially presented to District 7 Supervisor Norman Yee as a 50-unit project, but it inexplicably grew without warning to a 150-unit project, which suggests that the project may be too large for its small acreage footprint.

Neighbor Carolyn Seeley indicated that a 34-page report from the Planning Department raised major concerns relating to the environmental impact, the green belt, and landslides, along with 15 homes that sit above the development that may fall. "The developers have not performed a geological study about the 15 homes above the site, and a geological earthquake fault line runs right through the site," Seeley noted.

There's those concerns again about lurching down the hill.

For every housing unit built or acquired using this Bond funding that is set aside for housing the homeless, there will be a corresponding reduction of new, or preserved, units for low-income and middle-income San Franciscans.”

For his part, another neighbor, John Steadman, testified to CGOBOC on January 26 that the hill behind the present Forest Hill Christian Church on the site is extremely steep, and all neighbors are very concerned about the stability of the hill and construction of the proposed senior housing project, given proposed excavation. Steadman noted that in 1951 a house located at 50 Castenada Avenue directly above the church's current parking lot slid down the hill.

Katrina Kranz, who lives on Castenada Avenue, testified the 250 Laguna Honda location is a very isolated spot, with little for seniors to do. She noted the nearest amenities are a French restaurant and a Home Equity Loan business. "There's no pharmacy, there's no walkable grocery stores," Franz noted.

Marilyn Hsu, another neighbor who supports senior housing, noted the Forest Hill area is one of the worst areas for seniors because there's no nearby amenities, and the traffic on Laguna Honda is dangerous. Hsu testified her mother was nearly hit several times trying to access the Forest Hill Muni station due to the traffic.

Finally, another teacher at the existing Forest Hill pre-school on the proposed site, Sandra Pucinelli, testified seniors would have a difficult life on Laguna Honda since it's a dangerous street, She, too, noted the lack of nearby facilities since there's no laundromat, no grocery stores, and no pharmacies, and it's a long walk to access public transportation. She noted "Having a senior housing [building] that looks like a housing project from the 1970's is unacceptable for the neighborhood," and suggested it should be redesigned so it looks like it belongs in the area.

At the end of the hearing, Mr. Farrell noted "When this project is presented to you, we want it to be honest about what's being presented. What's being presented [to you] is not honest."

Planning Department's Concerns

In addition to concerns raised by neighbors, the Planning Department has raised significant concerns of its own, since the 250 Laguna Honda project has not been heard, approved, or received permits by the Planning Department or Planning Commission, despite the developer's "Preliminary Project Assessment application submitted to Planning in July 2016.

The Planning Department appears to be quite concerned about the project's proposal to excavate 16 feet below grade. Planning has instructed the developers to submit an "Environmental Evaluation Application" to determine whether a California Environmental Quality Act (CEQA) review may be required. Planning also noted that the project may be subject to review by the Department's Historic Preservation staff; may require a Preliminary Archeological Review (PAR) by a Planning Department archeologist; may require a Transportation Impact Analysis to determine whether the project may result in a significant transportation impact; and because the project site is located within a Seismic Hazard Zone (Landslide Hazard Zone) any new construction on the site is subject to a mandatory Interdepartmental Project Review with a geotechnical study that must be prepared.

The Planning Department confirmed on February 22 that none of these requirements have been met to date, since no additional applications have been submitted, including an Environmental Evaluation Application, a Legislative Amendment Application, and a Building Permit Application specifically referred to in the Planning Department's October 2016 response to the developer's Preliminary Project Assessment application.

Perhaps the Planning Department's biggest concern is the zoning. Planning noted the parcel is currently zoned RH-1(D), Residential-House, One-Family Detached Zoning District, with height and bulk limits. Planning noted construction of senior housing at a density of 150 units and development above 40 feet in height are not permitted in RH-1(D) zones. The proposed senior housing project is 49-feet high, exceeding current height restrictions.

For the project to proceed, it may be necessary to establish a Senior Housing Special Use District to allow for greater density. Rezoning and establishment of an SUD with new height controls are legislative actions that require Mayoral and Board of Supervisor approval, following Planning Commission approval.

Squishing Seniors into "Micro-Units"

In response to a public records request, MOHCD provided in February a preliminary proposed unit mix of the senior housing on Laguna Honda Boulevard. MOHCD indicated that preliminary plans for the proposed 150 units show 42 (28%) will be studio units averaging 382 square feet, about the size of a micro-unit. Another 107 (71.3%) will be one-bedrooms averaging 595 square feet. All units include kitchens and bathrooms, included in the square foot estimates.

By way of contrast, patient rooms at Laguna Honda Hospital just up the street average 218 square feet, although the double- and triple-room suites share a single bathroom in each suite. That means the studios at 250 Laguna Honda will be just 75% larger (with only 164 more square feet including a kitchen) than a patient room at LHH.

Cramming senior citizens into 382-square-foot studios and 595-square-foot one-bedroom units seems almost inhumane, given that many seniors have multiple pieces of durable medical equipment, including walkers and electric wheelchairs with recharging devices. Then there's the issue that many seniors need live-in assistants to help them with activities of daily living, like showering and cooking meals.

Between July 1, 2012 and December 31, 2016, our two county hospitals, Laguna Honda Hospital and SFGH, have between them discharged at least 260 patients out-of-county. Rather than dumping elderly San Franciscan's out-of-county, how many of the 150 senior housing units at 250 Laguna Honda Boulevard will have a set-aside to keep these seniors and disabled San Franciscans residing in-county?

Homeless Housing Set-Aside Surges to 30%

As first reported in April 2015 in "Mayor's Housing Scam, Redux," background documents included a February 3, 2015 housing pipeline presentation prepared for the Mayor that noted on page 4 that 20% of the affordable housing to be developed with the proposed bond would be set aside for the homeless.

A Dirty Little Secret: Bond Wasn't Earmarked for Homeless Housing

Even CGOBOC members were apparently surprised to learn in January 2016 there would be a set-aside of 20% of the bond to fund housing for the homeless. In January 2017 CGOBOC members were first informed that set-aside might climb to 30% for at least four of the planned projects funded by the Bond. Another surprise for them!

There's not one mention in the legal text in the November 2015 the voter guide that bond funds would be used to house the homeless, and certainly not at up to 30% of gross bond proceeds.

Fast forward to now. Of the four non-public housing projects that will receive funding under this Bond, the number of units to be set aside for the homeless has suddenly climbed from 20% to potentially up to 30% in each project.

For every housing unit built or acquired using this Bond funding that is set aside for housing the homeless, there will be a corresponding reduction of new, or preserved, units for low-income and middle-income San Franciscans. MOHCD has acknowledged that there are few funding streams available for middle-income housing, so the impact of diverting middle-income units to units to house the homeless is particularly severe on middle-income households.

MOHCD is not expected to present to CGOBOC again until July 27, 2017. We'll have to see what further changes to planned bond spending will be presented five months from now. Those probable future changes could portend that the Affordable Housing Bond will continue to lurch down a cliff.

The full version of this article: includes expanded information and other issues too extensive for this print version include in-depth information on preserving existing rental units, and market-rate and mixed uses funded by the affordable housing bond.

Monette-Shaw is a columnist for the Westside Observer, and a retired City employee. He received a James Madison Freedom of Information Award in "Advocacy" from the Society of Professional Journalists–Northern California Chapter in 2012. Contact: monette-shaw@westsideobserver.com

March 2017

While there is an acute shortage of nursing staff caring for patients, the Mayor’s hiring binge focused on increasing highly-paid managers, not nursing line staff. Above, SF General Hospital Nurses assembled inside City Hall after being locked out of the mayor’s office. The “empty scrubs,” represent the nursing jobs that need to be filled at their hospital. The missing staff means danger for patients, according to health care advocates. Photo: SEIU 1021

 

5,090 and Counting: Bloat Under Ed Lee

Who’s Auditing Mayor’s Hiring Binge?

Iwon’t keep you in suspense. The answer to the rhetorical question in the title of this article is — wait for it — nobody!

Theoretically, the legislative branch of City Hall — the Board of Supervisors — should have been providing some sort of checks and balances to the Mayor’s hiring binge. That didn’t happen.

In August 2016, San Francisco Chronicle reporter Heather Knight reported that Supervisor Scott Wiener, when asked about the size of City government and salaries paid to City employees, answered:

“… he wouldn’t defend every single hire made in the last five years and that he knows 30,626 workers [‘Full-Time equivalents’] sounds like an awful lot.”

If the Legislative Branch won’t defend every single hire Mayor Lee has made during his tenure, it’s reasonable to conclude the full Board of Supervisors has provided no checks or balances to the patronage hiring binge occurring under taxpayers’ noses.

Mayor’s Bloat of City Employees

On August 29, 2016 the City Controller provided historical data showing the number of FTE’s added across various fiscal year City budgets. (FTES’ are “full-time equivalent employees” calculated by combining multiple part-time employees into an equivalent 1.0 full-time employee.) The data is sobering, since it indicates the number of FTE’s may have soared somewhere between 18.4% and 30.2% during Mayor Lee’s watch.

…of the 6,414 additional full-and part-time employees Lee added since taking office 3,178 (49.5%) earn over $100,000 annually and account for 79% ($525.2) million of the $665.7 million annual payroll increase. … Those employees earning over $100,000 are going to drive up costs to the City’s pension system for decades to come”

As Ms. Knight reported, the City had 30,626 FTE’s budgeted at the start of FY 2016–2017 on July 1, 2016. If preliminary data from the Controller’s Office provided on January 12, 2017 holds true, by the end of Calendar Year 2016 on December 31, 2016 the number of FTE’s may have jumped by 3,379, to 34,005. If that pans out, the Mayor appears to have possibly added 7,897 FTE’s during his now six-year tenure as mayor, a 30.2% net increase in total FTE’s since taking office.

Back in March 2016, I wrote on article on Mayor Ed Lee’s hiring binge vs. City retiree pensions (“Mayor’s Hiring Binge vs. Retiree Pensions,” available on my web site. That first article examined the City’s budget that ended June 30, 2015.

That article noted the City Controller’s Office had admitted that as of December 2015, of $42 million in increased City employer share of pension contributions projected for FY 2016–2017 that started on July 1, 2016, fully $14 million of the $42 million — 33.3% — was attributable to increased pension costs as a direct result of adding additional new City employees.

I wrote a follow-up article (“Mayor Lee’s Five-and-a-Half Year Hiring Binge”) on September 5, 2016 that examined the City’s FY 2015–2016 budget ending June 30, 2016. The follow-up article illustrates that in the then-five-and-a-half years since Lee took office in the middle of FY 2010–2011, he added a total of 4,794 FTE’s, which translates into having added a total of 6,414 full- and part-time City employees to the City payroll during his tenure.

Starting July 1, 2016, the City reportedly had fully 30,626 FTE’s, or fully 40,397 full- and part-time employees, on the City’s payroll. But it is thought the number of FTE’s may have skyrocketed between July 1 and December 31, 2016.

One unanswered question is why San Francisco needed to add 655 more employees earning over $200,000 annually, each, at an increased cost of $147.8 million during Ed Lee’s tenure. The $147.8 million increase for the additional employees earning over $200,000 was fully 22.2% of the $665.7 million in payroll growth!

Why did the City need 922 employees earning over $200,000 each, at a total cost of $208.1 million? For that matter, of the 6,414 additional full-and part-time employees Lee added since taking office 3,178 (49.5%) earn over $100,000 annually and account for 79% ($525.2) million of the $665.7 million annual payroll increase. The remaining 51.5% (3,236) split the $139.5 million payroll increase. Those employees earning over $100,000 are going to drive up costs to the City’s pension system for decades to come!

San Franciscans deserve a top-to-bottom audit of the 6,414 additional full- and part-time employees Mayor Lee has added to the payroll during his hiring spree to determine how many more full- and part-time employees he added between July 1, 2016 and today’s date.

My September 5, 2016 update to the Mayor’s hiring binge introduced you to your new highest-paid City employee. That’s the Chief Investment Officer at the San Francisco Employees’ Retirement System (SFERS), William J. Coaker, Jr., who earned a whopping $512,485 in base pay for the period ending June 30, 2016. He may have received a raise since July 1, 2016 and may be in for another raise in July.

The Bouncing “FTE” Ball

Following the FTE bouncing ball of the number of FTE’s is more difficult than it appears.

Although I wrote in September that based on records provided by the City Controller’s Office the Mayor had added 4,794 FTE’s since taking office in 2010–2011, the San Francisco Examiner reported on December 14 that the number of FTE’s Lee has added stood at 5,090. That’s an increase of 296 additional FTE’s. The Examiner reported the Mayor has ordered City departments to “stop growing.”

So which is the accurate number of additional FTE’s added by the Mayor since FY 2010–2011? 4,794? 5,090? Or a new number of potentially 7,897 FTE’s?

I asked the City Controller on January 2, 2017 for clarification of the number of FTE’s on the City’s payroll on December 30, 2016. The Controller’s staff lamely responded on January 12 that there were 34,005 “paid staff.” Despite repeated follow-up requests, the Controller has still not confirmed whether “paid staff” and “FTE’s” are synonymous terms, or the ending count of FTE’s on December 30.

“Given these authorized numbers are for the fiscal year, the number provided to you previously [on January 12, 2017], of 34,005 paid staff, provides a snapshot in time accounting of City employees being paid as of the date you requested [January 2, 2017]. After the calendar year 2016 data becomes available, we can provide additional details on payments made to all employees during the calendar year.”

If the City did increase the number of FTE’s from 30,626 at the end of June 2016 to potentially 34,005 FTE’s six months later, that’s a significant increase of 3,379 additional FTE’s — probably on top of the 5,090 FTE’s the Examiner reported on December 14 that the Mayor has added since taking office. Again, if the 3,379 additional FTE’s proves to be accurate the Mayor may have added at least 7,897 FTE’s — a sobering 30.2% increase — during his tenure.

Mayor’s Lip Service

So far, the Mayor has paid mere lip service to limit the size of City government employees.

Mayor’s Skimpy Rebalancing Plan

Mayor Lee submitted a skimpy Rebalancing Plan four-page memo to Board president London Breed, Supervisor Mark Farrell as the immediate-past Chair of the Budget and Finance Committee, and City Controller Ben Rosenfield on December 8, 2016 that notes he has “cancelled” budget set-asides for homelessness services and transportation included in his so-called “balanced budget” he proposed on June 1, 2016.

The Rebalancing Plan memo lamely noted the Mayor would release “budget instructions” to [City] Department Heads also on December 8, in which he would “ask them to reduce General Fund support by 3% in each of the two upcoming budget years (resulting in a cumulative 6% reduction in the second year of the budget).”

Comically, the Mayor opined that he would “be advising all departments that they should not put forward in their budget submissions any net new positions [FTE’s] and should work diligently to restrict overtime costs.” That’s rich: Here we have the King of a Hiring Binge telling City department heads not to add new FTE’s during the next two fiscal years, after he’s added at least 5,090 FTE’s himself.

Weak Dog-and-Pony Show: Department Budget Instructions

Next, Mayor Lee followed up with his December 13 “Budget Outlook and Department Instructions” 30-page PowerPoint presentation. It was a weak dog-and-pony show.

Slide #14 rhetorically asked why deficits are on the rise again. Two of the Mayor’s explanations included rising employee costs largely related to pensions for City employees, and increases in City positions — meaning his hiring binge — that continue to grow.

Gee, really? Lee didn’t clarify that the number of FTE positions have grown considerably during his watch, or that for each new FTE position that qualifies for a City pension the City’s employer-share of pension contributions rises concomitantly. Another reason a complete audit is needed of just how many positions the Mayor has added to the budget is San Franciscans deserve an analysis of how much employer-share of pension contributions have climbed during his hiring binge.

Slide #20 noted the City has added 5,090 FTEs for an 18% growth since Lee’s first budget submission in FY 2011–2012. The Mayor noted “new FTE’s also contribute to overall future deficits [since] employee benefits are rising faster than inflation.” Mayor Lee noted the City “must take a disciplined approach to future growth [in FTE’s] to ensure this level of total FTE’s is sustainable.”

Now six years into his tenure, is the Mayor suddenly going to become “disciplined”? Didn’t Lee consider whether his hiring binge was “sustainable” at the time he approved each new FTE?

On slide #23, the Mayor appears to have found his kahunas when he indicated “Departments should not grow budgeted and funded FTE count[s].” If City departments can identify new sources to increase revenue by 3% in each of the two-year budget cycle, they may not have to consider any FTE reductions, and they may be able to sneak in “growing” the number of budgeted FTE’s!

5,090 … and Counting

If the City Controller’s January 12 estimate that we may now have 34,005 FTE’s at the end of December 2016 holds true, that’s an increase of 3,379 FTE’s. Do we add them to the 5,090 reported in the Examiner and the Mayor’s December 14 Budget Outlook presentation?

If we are up to 7,897 FTE’s hired during Ed Lee’s watchr, how many actual full-and part-time employees does that translate to? Way above the 40,397 full-and part-time employees as of June 30, 2016?

This bears repeating: The City Controller’s Office admitted in December 2015 that of the $42 million in the City’s increased employer-share of pension contributions projected for FY 2016–2017, fully $14 million — 33.3% — was a direct result of adding new City employees. The math is simple: more employees, the higher employer-share of pension contributions.

Should increases to the City’s employer-share of pension contributions continue at this 33% rate, how much in actual dollar amounts will be attributable solely to the continued piling on of additional patronage-based FTE’s to the City’s payroll? How much more will taxpayers be on the hook for contributing to shore up the Pension fund?

The 2010 U.S. Census Bureau reported San Francisco then had a total population of just 805,235. Today we have an estimated population of 864,816, representing a 7.4% net increase in City residents.

So why has the City added between 4,794 and 7,897 new FTE’s to the City’s payroll — at least a 18.4% increase, if not a 30.2% increase if the FTE’s have actually shot up to 34,005 — to accommodate approximately 60,000 new San Franciscans, a 7.4% net increase in population? Is anything out of whack here between a modest increase in the population, and the Mayor’s glut of a hiring binge?

Who’s auditing the patronage hiring-binge cookie jar? Anybody?

When it comes to monitoring, auditing — or ending — Mayor Lee’s six-year hiring binge, I’m reminded of prominent broadcast journalist Rachel Maddow’s admonition: Watch this space.

The full version of this article will be posted on the Westside Observer’s web site and at www.stopLHHdownsize.com.

Monette-Shaw is a columnist for Westside Observer and a retired City employee. He received a James Madison Freedom of Information Award in the “Advocacy” category from the Society of Professional Journalists–Northern California Chapter in 2012. Feedback: monette-shaw@westsideobserver.com

February 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