Chamber of Commerce

The Mirkarimi vote: Will there be some profiles of courage?

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(See the postscript for the Chronicle’s shameful crucifixion coverage of Mirkarimi and a timely, newsworthy oped it refused to run by Mirkarimi’s former girl friend. And how Chronicle columnist Debra Saunders ran the Nieves piece on her blog. Damn good for you, Debra Saunders.)

On Jan. 6, 2011, the Bay Citizen/New York Times broke a major investigative story headlined “Behind-the-Scenes Power Politics: The Making of Ed Lee.” The story by Gerry Shih detailed how then Mayor Gavin Newsom, ex-Mayor Willie Brown, and his longtime political ally Rose Pak orchestrated an “extraordinary political power play” to make Ed Lee the interim mayor to replace Newsom, the lieutenant governor-elect.

The story also outlined the start of a chain of events that leads to the vote by the San Francisco Board of Supervisors on Tuesday on whether Sheriff Ross Mirkarimi keeps his job.

Shih reported that “word had trickled out” that the supervisors had narrowed the list of interim candidates to three—then Sheriff Michael Hennessey, former Mayor Art Agnos, and Aaron Peskin, then chairman of the city’s Democratic party.  But the contenders “were deemed too liberal by Pak, Brown, and Newsom, who are more moderate.”

Over the next 48 hours, Pak, Brown, and the Newsom administration put together the play, “forging a consensus on the Board of Supervisors, outflanking the board’s progressive wing and persuading Lee to agree to become San Francisco’s first Asian-American mayor, even though he had told officials for months that he had no interest in the job,” Shih wrote.

The play was sold on the argument that Lee would be an “interim mayor” and that he would not run for mayor in the November election. The Guardian and others said at the time that the play most likely envisioned Lee saying, or lying, that he would not run for mayor and then, at the last minute, he would run and overpower the challengers as an incumbent with big downtown money behind him.  This is what happened. That is how Ed Lee, a longtime civil servant, became the mayor and that is how the Willie Brown/Rose Pak gang won the day for the PG&E/Chamber of Commerce/big developer bloc and thwarted the progressives.

Let us note that the other three interim candidates would most likely never have done what Lee did and suspend Mirkarimi for pleading guilty to misdemeanor false imprisonment in an arm-bruising incident with his wife Eliana. In fact, Hennessey supported Mirkarimi during the election and still does and says he is fit to do the job of sheriff. 

This was a political coup d’etat worthy of Abe Ruef, the City Hall fixer at the start of the century. “This was something incredibly orchestrated, and we got played,” Sup. John Avalos told Shih. Sup. Chris Daly was mad as hell and he voted for Rose Pak because, he told the Guardian, she was running everything in City Hall anyway. Significantly, the San Francisco Chronicle missed the story and ever after followed the line of its columnist/PG&E lobbyist Willie Brown and Pak by supporting Lee for mayor without much question or properly reporting the obvious power structure angles and plays.

This is the context for understanding a critical part of the ferocity of the opposition to Mirkarimi. As the city’s top elected progressive, he was a politician and force to be reckoned with. His inaugural address as sheriff  demonstrated his creative vision for the department and that he would ably continue the progressive tradition of Richard Hongisto and Hennessey. That annoyed the conservative law enforcement folks. He could be sheriff for a good long time, keep pushing progressive issues from a safe haven, and be in position to run for mayor when the time came. So he was a dangerous character.  

To take one major example, the  PG&E political establishment and others regard him as Public Enemy No. 1. Among other things, he managed as an unpaid volunteer two initiative campaigns during the Willie Brown era. They were aimed at kicking PG&E out of City Hall, enforcing the public power provisions of the federal Raker Act, and bringing  the city’s cheap Hetch Hetchy public power to its residents and businesses for the first time. (See Guardian stories since 1969 on the PG&E/Raker act scandal.)

He then took the public power issue into City Hall when he became a supervisor and aggressively led the charge for the community choice aggregation (cca) project.  His work was validated in the recent 8-3 supervisorial vote authorizing the city to start up a public power/clean energy program. This is the first real challenge ever to PG&E’s private power monopoly.

Significantly, Willie is now an unregistered $200,000 plus a year lobbyist for PG&E. He writes a column for the San Francisco Chronicle promoting, among other things, his undisclosed clients and allies and whacking Mirkarimi and the progressives and their issues on a regular basis.  And he is always out there, a phone call here, an elbow at a cocktail party there, to push his agenda.   The word is that he’s claiming he has the votes to fire Mirkarimi.

The point is that the same forces that put Lee into office as mayor are in large part the same forces behind what I call the political assassination of Mirkarimi.  And so, when the Mirkarimi incident emerged, there was an inexorable  march to assassination. Maximum resources and pressure from the police on Mirkarimi. And then maximum pressure from the District Attorney. And then maximum pressure from the judicial process (not even allowing  a change of venue for the case after the crucifixion media coverage.)  And then Lee calls Mirkarimi “a wife beater” and suspends him with cruel and unusual punishment: no pay for him, his family, his home, nor legal expenses for him or Eliana for the duration.

And then Lee pushes for maximum pressure from the City Attorney and the Ethics Commission to try Mirkarimi and force the crucial vote before the election to put maximum pressure on the supervisors. Obviously, the vote would be scheduled after the election if this were a fair and just process.

Lee, the man who was sold as consensus builder and unifier, has become a polarizer and punisher on behalf of the boys and girls  in the backroom.  

And so the supervisors are not just voting to fire the sheriff.  Mirkarimi, his wife Eliana, and son Theo, 3, have already paid a terrible price and, to their immense credit, have come back together as a family.

The supervisors got played last time and voted for a coup d’etat to make Lee the mayor, rout the progressives, and keep City Hall safe for Willie Brown and Rose Pak and friends.   This time the stakes are clear: the supervisors are now voting on the political assassination of the city’s top elected progressive and it’s once again aimed at helping keep City Hall safe for PG&E, the Chamber, and big developers.

The question is, will there be some profiles of courage this time around? b3

P.S.1  Julian Davis for District 5 supervisor: “Supes mum on sheriff,” read the Sunday Chronicle head. Nobody would say how he/she would vote. And poor Sup. Sean Elsbernd claimed that he would be “holed all Sunday in his office reading a table full of thick binders of official documents related to the case plus a few that he’s prepared for himself containing some case law.”  (Anybody wonder how he’s going to vote? Let’s have a show of hands.)  

The last time I saw Julian Davis he was holding a “Stand with Ross” sign at a Mirkarimi rally on the City Hall steps. With Davis, there would be no second guessing and hand wringing on how he would vote. That’s the problem now with so many neighborhood supervisors who go down to City Hall and vote with Willie and downtown. Davis would be a smart, dependable progressive vote in the city’s most progressive district (5), and a worthy successor to Matt Gonzalez and Ross Mirkarimi. If Davis were on the board now, I’m sure he would stand with Ross and speak for Ross, no ifs, ands, or buts. And his vote might be decisive.  

P.S. 2 The Chronicle’s  shameful crucifixion of Mirkarimi continues  The Chronicle has refused to run a timely and  newsworthy op ed piece from Evelyn Nieves, Mirkarimi’s former girl friend. She  wrote an op ed piece for the Chronicle four days before the Tuesday vote.  Nieves is an accomplished journalist who for several years was the San Francisco bureau chief for the New York Times.  She told me that she was notified Monday morning that the Chronicle didn’t have room for the op ed in Tuesday’s paper. I sent an email to John Diaz, Chronicle editorial page editor, and asked him why the Chronicle couldn’t run her op ed when the paper could run Willie Brown, the unregistered $200,000 plus PG&E lobbyist who takes regular whacks at Mirkarimi, as a regular featured column in its Sunday paper.  No answer at blogtime.

This morning, I opened up the Chronicle to find that the paper, instead of running the Nieves piece today or earlier,  ran an op ed titled “Vote to remove Mirkarmi,” from Kathy Black, executive director of the Casa de las Madres, the non profit group that advocates against domestic violence. It has been hammering Mirkarimi for months. On the page opposite, the Chron ran yet another lead editorial, urging the supervisors to “Take a Stand” and vote for removal because “San Francisco now needs its leaders to lead.” It was as if Willie was not only directing the Chronicle’s news operation but writing its editorials–and getting paid both by PG&E and the Chronicle.  And so the Chronicle started out with shameful crucifixion coverage of  Mirkarimi and then continued the shameful crucifixion coverage up until today. Read Nieves on Ross.

Well, the honor of the Chronicle was maintained by columnist Debra Saunders, virtually the Chroncle’s lone journalistic supporter of Mirkarmi during his ordeal. Many Chronicle staffers are privately supportive of Ross, embarrassed by Willie’s “journalism,” and critical of the way the Chronicle has covered Mirkarimi. Saunders posted the Nieves column her paper refused to print on her Chronicle blog. Damn good for you, Debra Saunders.  

 

 

Pagoda madness

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culture@sfbg.com

LIT Either I’m terrible at parking or Philip P. Choy was exactly the right person to author his recently-released San Francisco Chinatown: A Guide to Its History and Architecture (City Lights Publishers, 184pp, $15.95). We find a spot for my car in a well-hidden lot, tucked into an alleyway behind the Chinese Historical Society of America. It’s the first sign of the day that Choy’s knowledge of the area goes beyond tea shops and Peking duck.

“Chinatown…” Choy pauses as we stand outside a sidewalk stall whose owner angrily mutters at us (we’re blocking pedestrian traffic by hovering over his dried sea cucumber display.) “Chinatown is real. There are people here living, relying on Chinatown.”

Choy’s newest publication is not just a faithful retelling of the enclave’s social and architectural history. The book goes out of its way to dispel the stereotypes and fanciful constructions of the neighborhood that the outside world maintains. Choy was born in Chinatown, and as a co-professor of the first collegiate level class in Chinese American history at San Francisco State, he’s well-qualified to tell its story.

With apologies to our embattled shopkeeper, we continue to examine the cukes, first brought to the neighborhood via 1800s trade routes between China and the US. We move past other stalls while Choy points out the historical importance of their wares.

He shows me sandalwood, traditionally burned in Chinese temples, and ginseng root, which had been harvested by Native Americans but became a staple Chinese delicacy.

Choy tells me that the Chinese — who were not-so-charmingly called “mongols” around about 1840 — have suffered alongside Native Americans and other people of color throughout our country’s history, enduring ghettoized living situations and sub-par educational offerings.

As Choy and I wander Grant in search of the infamous pagodas that were built after the 1906 earthquake, we take a small detour up the hill to peek at Gordon J. Lau Elementary School. In the late 1800s a Chinatown father sued the city when his daughter was barred from attending other schools. Though the Supreme Court ruled in his favor, the school district opened the originally-named Chinese Primary School rather than integrate. 

We pass quickly by an East West bank, which was once the home of the first San Francisco paper, the Star. Around the corner stands a cheap retail center, originally the Mandarin Theater, a cultural and artistic mecca for neighborhood residents. Its once-lavish stage now serves as a platform for garish home decorations, its grand balconies now providing seating only to building debris.

Our whirlwind tour ends at the pagoda building Sing Fat, nestled at the corner of Grant Avenue and California Street. It was erected by the San Francisco Chinese Chamber of Commerce and prominent merchants in a post- 1906 earthquake attempt to repackage the once-funky Chinatown as an ornate, prosperous “oriental city.”

But Sing Fat’s pagodas are actually what Choy (an architect himself) calls a “Disneyland approach” to Chinese architecture: unstudied, inauthentic. The only legitimately Chinese quality of the structure is its green, yellow, and red color motif.

“Does any truly, authentically Chinese institution or edifice exist in Chinatown?” I ask, sidestepping tourists to keep up with Choy, who navigates Stockton Street with shocking deftness.

Choy reaches a hand out to avoid my death-by-delivery-truck and laughs. “Doesn’t exist.”

That’s because Chinatown is first and foremost a Chinese American town. And for all its perceived exoticism, the neighborhood has been around since almost the beginning of San Francisco.

Such is the beauty of Choy’s book. It retells a neighborhood’s story that’s too often render mythic by rumors money-hungry tour guides and ignorant outsiders. San Francisco Chinatown illuminates the untold history of the enclave, urging readers to consider its quiet alleyways and SROs housing six people just above the busy streets. The book wants you to consider the political, historical, and cultural implications of Chinatown’s very existence.

Says Choy of the generations who lived in this neighborhood, “they were pioneers of the city. They did more than just open laundries.”

PHILIP CHOY: SAN FRANCISCO CHINATOWN

Oct. 7, 1pm, free

California Historical Society

378 Mission, SF

www.litquake.org

 

Oct. 27, 11am, free

San Francisco Public Library

100 Larkin, SF

(415) 437-4844

www.sfpl.org

The latest insurance scam

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steve@sfbg.com

Mercury Insurance and its billionaire founder George Joseph are trying, for the second time in two years, to charge infrequent drivers more for car insurance.

Only this time, the measure has the surprising support of a progressive advocacy group that represents low-income communities of color — and that recently received a substantial donation from Mercury.

Proposition 33 — which so far has received fairly little news media attention in an election dominated by talk of taxes — is a reprise of a similar measure, Prop. 17, that went down to defeat in 2010.

The measure seeks to allow insurance companies to set premiums based in part on whether consumers have had continuous coverage. In other words, Mercury wants to raise rates on people who take a break from driving for economic, environmental, or other reasons.

The new measure contains a few exemptions targeted at sympathetic groups singled out by opponents in the last campaign, including active-duty soldiers and those unemployed due to layoffs.

And Prop. 33 also has a significant new backer, the Berkeley-based Greenlining Institute.

That alliance has drawn the ire of Consumer Watchdog, the nonprofit group that created California’s regulated car insurance system with Prop. 103 in 1988 and has been fighting to defend it ever since.

“It raises rates on the people that Greenlining claims to represent,” Consumer Watchdog President Jamie Court told us.

GOLDEN STATE GOLD

Mercury got its start in the 1960s, selling insurance to car owners who had spotty records, charging high rates — and aggressively challenging claims. About 80 percent of its business is in California.

And Mercury has been trying for some time to challenge the landmark Prop. 103, the 1988 ballot measure that set tight regulations on what car-insurance companies can charge — and what they can use to set rates.

Under that law, insurance companies can only use three basic rating factors: how long someone has been driving, vehicle miles traveled per year, and a driver’s safety record. There are 16 more factors that the state has allowed to have a smaller impact on rates, including the “persistency discount” that rewards drivers for staying with a single company.

Court said there are good reasons for that discount, noting that it costs companies more to market to and administer new customers than to serve existing ones.

Prop. 33 would allow consumers to shop around and still keep that discount — something that Court said only makes sense if you want to give insurance companies the power to divide customers by class and punish people who choose to give up driving for a while.

“It’s sleight of hand,” Court said. “Some drivers get a discount, everybody else is going to get a surcharge.”

Two years ago, every single legitimate consumer group in the state opposed Mercury’s efforts. So why is the prominent Greenlining Institute changing its tune?

Greenlining says the new measure is better. But the group’s staffers also acknowledge that Mercury is now a significant donor to Greenlining. Joseph appeared as a panelist at Greenlining’s 19th Annual Economic Summit in April, and the company donated $25,000 at that time.

Greenlining General Counsel Sam Kang, who pushed for the new position and is the designated point person in defending the stance, told us the new exemptions make the measure worth supporting. “The protections are what really distinguish Prop. 17 from Prop. 33,” Kang said. “It’s better than what we’ve got now.”

Kang argues that the increased competition it could foster among insurance companies might lower premiums for everyone. “If customers are willing to walk away” from their current insurance provider and still keep their continuous coverage discount, Kang told us, “that’s how it will drive down rates.”

Court called it “ridiculous” to claim this corporate-sponsored measure — Joseph has personally given almost $8.3 million to the Yes on 33 campaign, the lion’s share of its total funding — would drive down premiums through increased competition for customers.

“There’s no dispute on that and Greenlining is using tactics that are really reprehensible, and it’s a shame because they are likely to be the centerpiece of Mercury’s campaign,” he said. “George Joseph is trying to get cover from a group that has no business doing this.”

Greenlining Executive Director Orson Aguilar acknowledged the organization was divided on this measure, and that is still open to being convinced it made the wrong call. “This was hotly debated. This was not an easy issue for us,” Aguilar told us. “Frankly, if we’re wrong, we’re happy to be convinced.”

GREENLINING’S CAMPAIGN ROLE

Yet it may be too late for that: The state voter handbook has already been printed, and the Yes on 33 campaign has been touting the group’s support. “The Greenlining Institute — a consumer group founded to fight unfair business practices — supports Proposition 33 because it protects consumers and allows this discount to everyone who has followed the law,” says a ballot argument that signed by Kang and CDF Firefighters President Robert T. Wolf and California Hispanic Chamber of Commerce President Julian Canete.

“As you know, we opposed Prop. 17 and we opposed it quite vigilantly,” Kang told us. And the main reason was the organization didn’t buy Mercury’s spin that it would simply lower rates for those with continuous coverage. “If someone is going to get a discount, someone else is going to pay more,” Kang acknowledges.

Yet he is now parroting the Yes on 33 campaign’s rhetoric that the measure simply rewards drivers who “followed the law” and maintained continuous insurance coverage, saying the exemptions that Mercury wrote into the new measure actually give those groups — soldiers and the unemployed, which he notes are disproportionately poor people of color — more protections than they now enjoy.

“If you have continuous coverage for five years, you are eligible for a persistency discount,” Kang said, casting the measure as simple and straightforward.

Court and his group strongly object to that simplistic approach, asking why an insurance company would sponsor a measure that lowers premiums. The reality, consumer advocates say, is that this is a duplicitous measure that relies on a flawed premise and is really about giving insurance companies a new tool to capture certain customers and bilk those who can least afford it.

“These exemptions are bullshit, and they are written to be very narrow. It’s lipstick on a pig,” Court said. “It exposes how it raises rates for all low-income people who don’t meet these very narrow exemptions.”

In fact, the official summary by the Attorney General’s Office makes it clear that prop. 33 “Will allow insurance companies to increase cost of insurance to drivers who have not maintained continuous coverage.”

Kang disputes that objective analysis, telling us, “The ballot title and summary is up for discussion as far as what it meant.”

Kang admitted that Mercury is supporting Greenlining. “They gave us $25,000 in anticipation of the summit, and we anticipate they they’ll help us out in the advocacy of this measure,” Kang said. “Corporations regularly contribute to us, and it has never guaranteed our consent or dissent on anything.”

He defended the approach, telling us, “Sometimes working with corporations is the only way to make monumental changes,” citing their successful efforts to improve the billing practices of PG&E, which regularly makes six-figure donations to Greenlining.

Aguilar also strongly defended the organization’s integrity. “To say that just because we got a stipend from Mercury Insurance” that bought their support, Aguilar said, is simply wrong. “Money comes from somewhere.”

Greenlining’s allies in various campaigns to protect low-income communities say they’re willing to give the group the benefit of the doubt. Joshua Arce, executive director of the SF-based Brightline Defense Project, doesn’t think donations from Mercury Insurance influenced the group’s position, noting that it has also received contributions from PG&E and AT&T then subsequently joined campaigns that opposed those companies’ practices.

Instead, he said Greenlining was probably just offering support to the measure because Mercury had addressed Greenlining’s criticism of Prop. 17 two years ago. “That’s one of the things about Greenlining,” Arce told us, “they say, ‘If you fix all the things we laid out, if you address them, then we’ll support it.” Yet Court said the minor changes made between Props. 17 and 33 shouldn’t have won over such a potentially influential ally. “I’m told they’re going to use Greenlining in the commercial. It’s clearly a transactional relationship,” Court said. “When the billionaire behind Mercury Insurance says it, it’s hard to believe, but it’s easier to believe coming from an organization called Greenlining.”

Lee appoints Santos, a staunch development advocate, to CCSF board

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Rodrigo Santos, a structural engineer who heads the pro-development advocacy group San Francisco Coalition for Responsible Growth, had already raised an unheard of amount of money in his race for the City College of San Francisco Board of Trustees, $113,153 in just six months, mostly from real estate and development interests.

Today, he got another big boost when Mayor Ed Lee appointed Santos to fill the vacancy on that board created by the recent death of Milton Marks, giving the ambitious Santos a big advantage in the fall contest and perhaps signaling Lee’s support for making deep program cuts to satisfy the accrediting commission’s demand that CCSF cut expenditures and beef up its reserves.

“Tough decisions and reform are what City College needs at this time,” Lee said at a press conference this afternoon, calling Santos “someone who shares my vision of reform and will support the tough decisions ahead.”

Although Lee said Santos “is committed and passionate about education,” Santos hasn’t been active on education issues before running for this office. His passions seem to lie mostly with advocating for developers and opposing government regulations in front of the Planning Commission and other bodies, where he regularly testifies, and in helping fellow conservatives gain power on city boards and commissions.

The appointment continues Lee’s pattern of appointing and relying on controversial conservatives in key areas, from his chief fundraiser and economic adviser, venture capitalist Ron Conway, to his recent reappointment to the Planning Commission of Republican Michael Antonini, who gave Santos the maximum $500 contribution in his CCSF race.

“I join an institution that must be saved. I am absolutely committed to that goal,” Santos told a press conference in the Mayor’s Office. He said that he will work to “achieve consensus” around solutions to the troubled institution’s problems, while also declaring, “We must support the interim chancellor, Pamila Fisher.”

But rather than someone who seeks political compromise, Santos’ reputation is as more of polarizing and ideologically conservative firebrand who regularly criticizes government and progressives as part of the downtown alliance that includes Plan C, Committee on Jobs, Building Owners and Managers Association, the SF Chamber of Commerce, and the Board of Realtors PAC

“I actually find him to be pretty divisive in trying to work on issues at [the Department of Building Inspection],” Debra Walker, who served with Santos on the Building Inspection Commission. “He always seems to come into a situation attacking and I hope he doesn’t bring that to this board.”

Walker, a longtime progressive activist and former supervisorial candidate, said that she and her political allies have long endured nasty attacks from Santos and his CRG bretheren.

“They spend all of their time attacking progressives and he gets pretty intense about attacking rather than working with people,” she said. “CRG is about getting people elected who are conservative, that’s their whole reason for existence, perpetuating the real estate industry’s impact of city policies, which has had a negative impact on the middle class.”

Asked about that reputation by the Guardian, both Lee and Santos denied it and refused to answer follow-up questions. Santos said CRG has a “diverse membership” and told us, “I don’t know why you would cast that as polarizing.”

Yet its board is made up almost exclusively of real estate and development interests who have shown themselves to be politically ambitious, winning key mayoral appointments to the Building Inspection and Small Business commissions and working with mayoral staffers to hold onto key leadership positions, edging out supervisorial appointees in the process.

Sup. John Avalos, who was targeted by a CRG independent expenditure campaign in 2008, said that he researched Santos’ background on education issues and was a little surprised not to find anything. “More than anything, the appointment says more about Lee’s pro business leanings,” Avalos told us.

It was also telling that Lee included two of the most conservative CCSF trustees in his press conference, Natalie Berg and Anita Grier, but that more liberal trustees Chris Jackson and John Rizzo were neither consulted nor notified directly about the appointment. “I’m sorry the mayor didn’t involve us more or let us know,” Rizzo told us.

While Rizzo didn’t endorse Santos – instead backing Jackson, Steve Ngo, and Rafael Mandelman (who Rizzo said “really does have the best interests of the district at heart”) – he didn’t want to offer an opinion on Santos, saying that he wants to work constructively with him to solve the district’s problems: “I welcome him to the board and hope he will welcome the work we’ve been doing.”

Santos told reporters that he starts every work day with an “open house” at his office from 5:20-8am, discussing various issues with anyone who wants to stop by, before getting into his engineering and administrative work for his firm, Santos & Urrutia. “I will bring that same commitment to City College,” he pledged.

Impertinent question for Sup. Malia Cohen

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As attentive readers know, I get most annoyed when a “neighborhood” supervisor, who ran as a “neighborhood” candidate, gets to City Hall and then votes the Chamber of Commerce/big development line without gulping.  And so I pop off Impertinent Questions now and then to pin the “neighborhood” supervisor on key votes  to illuminate the issue.  My latest Impertinent Question went by email last Friday  to Sup. Malia Cohen of District l0 (Potrero Hill, Bay View, Hunters Point) on her swing vote to keep the developers’ quarterback on the Planning Commission. City Editor Steve Jones  makes the point neatly  about Michael Antonini in his blog.  http://www.sfbg.com/politics/2012/08/01/antonini-quarterback-development-interests-wins-game

Cohen has earned an 80 per cent vote in the recent Chamber of Commerce’s mid-year “Paychecks & Pink Slips” voting scorecard for supervisors. And she is likely to do even better on the next score card with her votes for astroturf at Golden Gate Park and to shut down the Sunshine Task Force.                                                                                    

“Dear Sup. Cohen,

“Why did you as a neighborhood supervisor from District l0,  a neighborhood anxious about massive development from Potrero Hill to Hunters Point,  provide the swing vote for Antonini who operates as a quarterback for big development interests on the planning commission?  I would appreciate an answer for my Bruce blog at sfbg.com.”  I gave the supervisor a Monday deadline but I still had not heard from her by Tuesday evening.. I’ll keep trying to reach her for comment and keep you posted. B3

 

Compromise measures

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news@sfbg.com

San Franciscans are poised to vote this November on two important, complicated, and interdependent ballot measures — one a sweeping overhaul of the city’s business tax, the other creating an Affordable Housing Trust Fund that relies on the first measure’s steep increase in business license fees — that were the products of intense backroom negotiations over the last six months.

Mayor Ed Lee and his business community allies sought a revenue-neutral business tax reform measure that might have had to compete against an alternative proposal developed by Sup. John Avalos and his labor and progressive allies, who sought around $40 million in new revenue, although both sides wanted to avoid that fight and find a compromise measure.

Meanwhile, Mayor Lee was having trouble securing business community support for the housing trust fund that he pledged to create during his inaugural address in City Hall in January. So he modified his business tax proposal to bring in $13 million that would be dedicated to the Affordable Housing Trust Fund, but that didn’t satisfy the Avalos camp, who insisted the city needed more general revenue to offset cuts to city services and help with the city’s structural budget deficit.

Less than a day before the competing business reform measures came before the Board of Supervisors on July 24, a compromise was finally struck that would bring $28.5 million a year, with $13 million of that set aside for the affordable housing fund, tying the fate of the two measures together and creating a kumbaya moment at City Hall that was reminiscent of last year’s successful pension reform deal between labor and the business community.

But there was one voice raised at that July 24 meeting, that of Sup. David Campos, who asked questions and expressed concerns over whether this deal will adequately address the “crisis” faced by the working class in a city that will continue to gentrify even if both of these measures pass. Affordable housing construction still won’t meet the long-term needs outlined in the city’s Housing Element that indicates 60 percent of housing construction would need public subsidies to be affordable to current city residents.

It’s also worth asking why a business tax reform measure that doubles the tax base — just 8.4 percent of businesses in San Francisco now pay the payroll tax, whereas 16.4 percent would pay the gross receipts tax that replaces it — doesn’t increase its current funding level of $410 million (the $28.5 million comes from increased business license fees). Some industries — most notably the technology and restaurant industries that have strongly supported Mayor Lee’s political ambitions — could receive substantial tax cuts.

Politics is about compromise, and Avalos tells us that in the current political climate, these measures are the best that we can hope for and worthy of progressive support. And that may be true, but it also indicates that San Francisco will continue to be more welcoming to businesses than the working class residents struggling to remain here.

 

SOARING HOUSING COSTS

As Mayor Lee acknowledged during his inaugural speech, the boom times in the technology industry has also been driving up commercial and residential rents, he sought to create “housing for the 100 percent.”

The median rent in San Francisco has been steadily rising, jumping again in June an astounding 12.9 percent over June of last year, according to real estate monitor RealFacts, leaving renters shelling out on average an extra $350 a month to landlords.

Driven by a booming tech industry and a lag in new housing, the average San Francisco apartment now rents for $2,734. That’s an annual increase of $4,000 per unit over last year, in a city that saw the highest jumps in rent nationally in the first quarter of 2012. Even prices for the average studio apartment have edged up to $1,800 a month.

The affordability gap between housing and wages in the city is stark. Somebody spending a quarter of their income on rent would need to be making $85,000 a year just to keep up with the average studio. With a mean wage of $64,820 in the San Francisco metro area, even middle class San Franciscans have a difficult time affording a modest apartment. For the city’s lowest paid workers, even earning the country’s highest minimum wage of $10.25 an hour, even devoting every earned dollar to rent still wouldn’t pay for the average small studio apartment.

For those looking to buy a home in the city, it can be a huge hurdle to put aside a down payment while keeping up with the city’s high rents. Almost 90 percent of San Franciscans cannot afford a market rate home in the city. The average San Francisco home price was up 1.9 percent in June over May, climbing to $713,500, or a leap of $50,000 per unit over last year’s prices.

In the 2010 census, before the recent boom in the local real estate market, San Francisco already ranked third in the nation for worst ratio between income and home ownership prices, behind Honolulu and Santa Cruz.

But as the city leadership grapples to mitigate the tech boom’s effects, the lingering recession and conservative opposition to new taxes have gutted state and federal funds for affordable housing. Capped off last December by the California Legislature’s decision to dissolve the State Redevelopment Agency, a major source of money for creating affordable housing, San Francisco has seen a drop of $56 million in annual affordable housing funds since 2007.

Trying to address dwindling funding for affordable housing, the Board of Supervisors voted 8-2 on July 24 to place the Affordable Housing Trust Fund measure on the fall ballot. Only the most conservative supervisors, Sups. Sean Elsbernd and Carmen Chu, opposed the proposal. Sup. Mark Farrell, who has signaled his support for the measure, was absent.

“Creating a permanent source of revenue to fund the production of housing in San Francisco will ensure that San Francisco is a viable place to live and work for everyone, at every level of the economic spectrum. I applaud the Board of Supervisors,” Mayor Lee said in response.

At the heart of the program, the city hopes to create 9,000 new units of affordable housing over 30 years. The measure would set aside money to help stabilize the ongoing foreclosure crisis and replenish the funds of a down payment assistance program for those earning 80 to 120 percent of the median income.

To do so, the city anticipates spending $1.2 billion over the 30-year lifespan of the program, with a $20 million annual contribution the first year increasing $2.5 million annually in subsequent years. It would fold some existing funding in with new revenue sources, including $13 million yearly from the business tax reform measure. Language in the housing fund measure would allow Mayor Lee to veto it is the business tax reform measure fails.

The board was forced to delay consideration of the business tax measure until July 31 because of changes in the freshly merged measures. That meeting was after Guardian press time, although with nine co-sponsors on the board, its passage seemed assured even before the Budget and Legislative Analysts Office had not yet assessed its impacts, as Campos requested on July 24.

“I do believe that we have to ask certain questions when a proposal of this magnitude comes forward,” Campos said at the hearing, later adding, “When you have a proposal of this magnitude, you’re not going to be able to adjust it for some time, so you want it to be right.”

The report that Campos requested, which came out in the late afternoon before the next day’s hearing, agreed that it would stabilize business tax revenue, but it raised concerns that some small businesses exempt from the payroll tax would pay more under the proposal and that it would create big winners and losers compared to the current system.

For example, it calculated that between the gross receipts tax and business license fee, a sample full service restaurant would pay 69 percent less taxes and a supermarket 33 percent less taxes, while a commercial real estate leasing firm would pay 46.7 percent more tax and a large engineering firm would see its business tax bills more than double.

Board President David Chiu, who has co-sponsored the business tax reform measure with Mayor Lee since its inception, agreed that it is a “once in a decade reform,” calling it a “compromise that reflects the best sense of that word.” And that view, that this is the best compromise city residents can expect, seems to be shared by leaders of various stripes.

 

BACKING THE COMPROMISE

The business community and fiscally conservative politicians have long called for the replacement of the city payroll tax — which they deride as a “job killer” because it uses labor costs to gauge the size of company’s size and ability to pay taxes — with a gross receipts tax that uses a different gauge. But the devil has been in the details.

Chiu praised the “dozens and dozens and dozens of companies that have worked with us to fine-tune this measure,” and press reports indicate that representatives of major corporations and economic sectors have all spent hours in the closed door meetings shaping the complicated formulas for how they will be taxed, which vary by industry.

When the Guardian made a Sunshine Ordinance request to the Mayor’s Office for a list of all the business representatives that have been involved in the meetings, its spokespersons said no such list exists. They have also asked for a time extension in our request to review all documents associated with the deliberations, delaying the review until next week at the earliest, after the board approves the measure.

But the business community seems to be on board, even though some economic sectors — including real estate firms and big construction companies — are expected to face tax hikes.

“The general reaction has been neutral to favorable, and I expect we’ll be supportive,” Jim Lazarus, the vice president of public policy for the San Francisco Chamber of Commerce, who participated in crafting the proposal but who said the Chamber won’t have an official position until it votes later this week.

Lazarus noted the precipitous rise in annual business license fees — the top rate for the largest companies would go from just $500 now to $35,000 under the proposal, going up even more in the future as the Consumer Price Index rises — “but some of it will be offset by a drop in the payroll tax,” Lazarus said.

He also admitted that the new tax system will be “hugely complicated” compared to the payroll tax, with complex formulas that differ by sector and where economic transactions take place. But he said the Chamber has long supported the switch and he was happy to see a compromise.

“I’m assuming it will pass. I don’t believe there will be any major organized opposition to the measure,” Lazarus said.

Labor and progressive leaders also say the measure — which exempts small businesses with less than $1 million in revenue and has a steeply progressive business license fee scale — is a good proposal worth supporting, even if they didn’t get everything they wanted.

“We fared pretty well, the royal ‘we,’ with the mayor starting off from the position that he wanted a revenue-neutral proposition,” Chris Daly, who unsuccessfully championed affordable housing ballot measures as a supervisor before leaving office and becoming the political director for SEIU Local 1021, the largest union of city employees.

Both sides say they gave considerable ground to reach the compromise.

“Did we envision $28.5 million in new revenue? No,” said Lazarus, who had insisted from the beginning that the tax measure be revenue-neutral. “But we also didn’t envision the Affordable Housing Trust Fund.”

Daly and Avalos also said the measures need to be considered in the context of current political and economic realities.

“We were never going to be able to pass — or even to craft — a measure to meet all of the unmet needs in San Francisco,” Daly said. “Given the current political climate, we did very well.”

“If we had a different mayor who was more interested in serving directly the working class of the city, rather than supporting a business class that he hopes will serve all the people, the result might have been different,” Avalos said. “But what’s significant is we have a tax measure that really is progressive.”

Given that “we have an economic system that is based on profits and not human needs,” Avalos said, “This is a good step, better that we’ve had in decades.”

 

THE HOUSING CRISIS

The tax and housing measures certainly do address progressive priorities — bringing in more revenue and helping create affordable housing — even if some progressives express concerns that conditions in San Francisco could get worse for their vulnerable, working class constituents.

“I don’t know if the proposal before us is aggressive enough in terms of dealing with a crisis,” Campos told his colleagues on July 24 as they discussed the housing measure, later adding, “As good as this is, we are truly facing a crisis and a crisis requires a level of response that I unfortunately don’t think we are providing at this point.”

Not wanting to let “the perfect be the enemy of the good,” Campos said he still wanted to be able to support both measures, urging the board to have a more detailed discussion of their impacts.

“I wish this went further and created even more funding for critically needed affordable housing,” Sup. Eric Mar said before joining Campos in voting for the proposal anyway. “I think they need to build 60 percent of those units as below market rate otherwise we face more working families leaving the city, and the city becoming less diverse.”

Yet affordable housing advocates are desperate for something to replace the $56 million annual loss in affordable housing the city has faced in recent years, creating an immediate need for action and potentially allowing Lee to drive a wedge between the affordable housing advocates and labor if the latter held out for a better deal.

Many have heralded the mayor’s process in bringing together developers, housing advocates, and civic leaders to build a broad political consensus for the measure, particularly given the three affordable housing measures crafted by progressives over the last 10 years were all defeated by voters.

“One of the goals of any measure like this is for it to gain broad enough support to actually pass,” Sup. Scott Wiener said at a Rules Committee hearing on the measure.

In the measure’s grand bargain, developers receive a reduction in the percentage of on-site affordable housing units they are required to build, from 15 percent of units to 12 percent. The city will also buy some new housing units in large projects, paying market rate and then holding them as affordable housing — the buying power of which could be a boon to developers while creating affordable housing units.

At its root, the measure shifts some of the burden of funding affordable housing from developers to a broader tax base and locks in that agreement for 30 years, which could also spur market rate housing development in the process.

A late addition to the proposal by Farrell would create funding to help emergency workers with household earnings up to 150 percent of average median income buy homes in the city, citing a need to have these workers close at hand in the event of an earthquake or other emergency.

While some progressives have grumbled about the givebacks to developers and the high percentage of money going to homebuyer assistance in a city where almost two-thirds of residents rent, affordable housing advocates are pleased with the proposal.

“Did we gain out of this local package? Yes, we got 30 years of local funding. We came out net ahead in an environment where cities are crashing. We essentially caught ourselves way early from the end of redevelopment funds,” said Peter Cohen, executive director of the San Francisco Council of Community Housing Organizations.

Without it, Cohen says many affordable housing projects in the existing pipeline would be lost. “This last year was a bumpy year, and we will not be back to the same operation level for a number of years,” Cohen said. “There was a dip and we are coming out of that dip. It will take us a while to get back up to speed.”

The progressive side was also able to eliminate some of the more controversial items in the original proposal, including provisions that would expand the number of annual condo conversions allowed by the city and encourage rental properties to be converted into tenancies-in-common.

With ballot measures notoriously hard to amend, the Affordable Housing Trust Fund measure is a broad outline with many of the details of how the fund would be administered yet to be filled in. If passed, it will be up to Olson Lee, head of the Mayors Office on Housing and former local head of the demised redevelopment agency, to fill in the details, folding what was essential two partnered affordable housing agencies into a single local unit.

But even the most progressive members of the affordable housing community said there was no other alternative to addressing affordable housing in the wings — which is indeed a crisis now that redevelopment funds are gone — making this measure essential.

As Sara Shortt of the Housing Rights Committee of San Francisco told the Rules Committee, “We lost a very important funding mechanism. We have to replace it. We have no choice.”

Guest opinion: RCV is good for progressives

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Since San Francisco began using ranked choice voting in 2004 and public financing of campaigns in 2002, the city has been a leader in the types of political reform badly needed at state and national levels. People of color today have an unprecedented degree of representation and progressives are a dominant presence in city government. Elections are being decided in November, when turnout usually is highest, and the combination of public financing and deciding races in one election minimizes the impact of independent expenditures and Super PACs .

Yet progressive stalwart Calvin Welch, whose work we have long admired, recently authored a Bay Guardian oped against RCV. His charges against RCV are as wrong today as they were when he first made them 10 years ago when he opposed RCV on the ballot. And given the horrible Supreme Court ruling known as Citizens United, which has opened the floodgates on corporate campaign spending and did not exist when San Francisco last used separate runoff elections, returning to two elections is a direct threat to the future of San Francisco progressivism. 

The most serious of his claims is that RCV favors “moderate to conservative candidates” because “left-liberals do very well in run-off elections” since “in low-turnout elections, left-liberals vote more heavily than do conservatives.” He cites the 2000 supervisorial races and 2001 city attorney race, in which “the more liberal candidate for City Attorney, Dennis Herrera” bested “Chamber of Commerce functionary Jim Lazarus.” He asserts “that’s a verifiable San Francisco political fact.”

But San Francisco State University professor Richard DeLeon, author of the acclaimed book of Left Coast City about San Francisco politics, debunked that claim with real election data in his 2002 paper, “Do December runoffs help or hurt progressives?”

He found that in the November 2001 city attorney election, for every 100 voters who turned out in progressive precincts, 107 turned out in conservative precincts. But in the December 2001 runoff, for every 100 voters who turned out in the progressive precincts, 126 turned out in the conservative precincts, an 18 percent increase. Wrote DeLeon, “This dramatic increase in the ratio of conservative to progressive voters occurred despite (or perhaps because of) the 44 percent drop in voter turnout citywide between November and December.”

He continued: “If San Francisco had used [ranked choice voting] in November, Herrera most likely would have won by an even greater margin. In November, the liberal/progressive candidates for city attorney won a combined 60 percent of the vote…In the December runoff, however, Herrera won with only 52 percent of the vote. Thus, due to the proportionally greater decline in progressive voter turnout, Herrera probably lost approximately 8 percent of his potential vote, making the election close.”

DeLeon also rebutted Welch’s citation of the supervisorial races in 2000 as ones that demonstrated a progressive advantage in low-turnout runoffs, writing:

 “Progressive success that year was NOT due solely to a one-time surge in turnout among progressive voters…Many powerful forces converged in that election, not least the anti-Willie Brown backlash, the cresting of the dot-com invasion, and the return to district elections, which forced despised incumbents to stand trial before angry neighborhood electorates.”

DeLeon concluded:  “Based on the evidence presented, I conclude that December runoffs have hurt progressive voters, candidates and causes in the past and (absent same-day runoffs) will continue to do so in the future, even under district elections.”The Bay Guardian cited Professor DeLeon’s study in March 2002 (see  and scroll down to “A is OK”), and Mr. Welch is ignoring these results today just as he did then.

Certainly progressives haven’t won 100% of RCV elections — should any political perspective? — but they have done well nonetheless, electing  Bay Guardian-endorsed candidates like John Avalos, David Campos, Eric Mar, David Chiu and Ross Mirkarimi, despite those candidates not being incumbents. Other progressive incumbents first elected before RCV elections, like Aaron Peskin, Chris Daly, and others, were re-elected under RCV. And Mirkarimi was elected citywide in the sheriff’s race. On  the flip side, progressive Eileen Hansen most certainly would have beaten moderate Bevan Dufty in a November RCV contest for D8 supervisor; instead she lost in December after finishing first in November.

What’s actually at stake here is how we define progressivism. Since we began using RCV in 2004, 8 of the eleven members of the Board of Supervisors come from communities of color, a DOUBLING from pre-RCV days. At the citywide level, all seven officials elected by RCV come from communities of color. So out of the 18 elected officials in San Francisco, a whopping 15 out of 18 come from communities of color, the highest percentage for a major city in the United States.

The proposed repeal amendment would launch low-turnout September elections in San Francisco. In fact, the December 2001 city attorney race in which Welch cites as exemplary had a turnout of 15 percent of registered voters, the lowest in San Francisco’s history. New York City’s last September mayoral primary had a turnout of 11.4 percent. In Charlotte NC (population 750,000, similar to San Francisco) its last mayoral primary had a turnout of only 4.3 percent. Cincinnati had a September turnout of 15 percent, and Boston and Baltimore had September mayoral primaries with turnout in the low 20s. Many cities in Minnesota have September primaries with extremely low turnout; the two largest cities, Minneapolis and St. Paul, have switched to RCV largely to eliminate September primaries.

Research has demonstrated that voters in low turnout elections are disproportionately more conservative, whiter, older, and more affluent; those who don’t participate are people of color, young people, poor people — and progressives. So having a mayoral race in a low turnout September election has real consequences not only on voter turnout but on the demographics of the electorate.

While we share the priorities of Welch’s progressive economics, we believe progressivism must be more inclusive, especially if it wants to enjoy the support of these burgeoning demographics. While disappointed by the lack of progressive achievements of President Barack Obama, we still view the election of the first African American as president as a major progressive achievement.

Finally, we would assert that the ranked ballots used in RCV have been important for San Francisco democracy. Just look at the recent “top two” primary on June 5, and you can see the defects of the methods proposed to replace RCV. In many races across the state – including in the Marin County congressional race where progressive Democrat Norman Solomon lost by 0.2 percent — too many spoiler candidates split the field and candidates got into the top two with extremely low vote percentages, some as low as 15 percent of the vote. In one race where there was a Latino majority and a solid Democratic district, the Democrats ran so many candidates that the Democratic vote split and two white Republicans made the runoff with low vote percentages.

San Francisco risks such elections if we get rid of RCV. Think of the last mayoral election, and the choice for Asian voters if we used single-shot plurality voting instead of RCV. Which Asian candidate would they vote for with their single-shot vote — Lee, Chiu, Yee, Ting, Adachi? What kind of vote split might have occurred? And to avoid that, what kind of backroom dealing would have occurred BEFORE the election to keep that many candidates out of the race to prevent that vote-splitting?  We saw such vote splitting in the 2003 mayoral election as well, with various progressive candidates running and splitting the progressive vote. Going back to plurality elections would be damaging for constituencies that often run multiple candidates, such as the Asian and progressive communities.

RCV has been good for San Francisco, and we should keep it. For those who would like to see a runoff in mayoral races, Board president David Chiu has proposed a compromise that, while increasing the costs of running for mayor, is far better than the repeal measure for September elections. Chiu’s proposal would keep RCV to elect the mayor, but with a December runoff if no mayoral candidate won a majority of first rankings in November. The 2011 mayoral election would have gone to a runoff, with John Avalos as Ed Lee’s opponent.

San Francisco progressives should embrace a view of progressivism that is inclusive, promotes higher turnout and is based on a politics that is looking forward instead of backward to some golden age that never existed. Ranked choice voting and public financing are two parts of the puzzle for ensuring a vibrant progressivism.

Steven Hill led the campaign for ranked choice voting in San Francisco, and Matt Gonzalez was President of the Board of Supervisors and legislative author of the RCV charter amendment. See www.SFBetterElections.org for more information

 

 

Guardian Voices: The case against RCV

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“The Cure for the Ills of Democracy is More Democracy”
                                 — old Progressive Party slogan

My friends here at the Guardian have elevated support for ranked choice voting to a defining requirement for being considered a progressive. This is not only historically incorrect,  it is actually politically silly. There are many progressive reasons to oppose RCV — not the least of which is the undeniable fact that it overwhelmingly favors incumbents, has failed to deliver on the 2002 ballot promises, and now poses real threats to progressive political advancement in key supervisor districts. 

First, a little history. 

The two greatest national political victorys  of the Progressive Era were the 1913 adoption of the 17th Amendment of the US Constitution, which required direct elections of US Senators, and, at the tail end of the era,  the 1920 passage of the 19th Amendment, which gave women the right to vote. Both expanded people power in elections, curing the ills of democracy by more democracy.

Historically, to be a Progressive is to favor MORE elections, MORE political opportunities for more people at the local level.  How can it be that it is now progressive to favor FEWER elections at the local level?

In the March, 2002 Voters Handbook, ballot arguments against RCV were authored by several progressive activists (Sue Bierman, Jane Morrison, David Looman, Larry Griffin, David Spiro and me, to name a few). We argued then that replacing local elections with a mathematical formula that few understand and even fewer could explain was political foolishness. While were outvoted, I think we were right a decade ago.

Left-liberals do very well in run-off elections in San Francisco — from 1975, when Moscone beat Bargbagalata in a December run-off, to the run-off victory of the more liberal candidate for City Attorney, Dennis Herrera, over Chamber of Commerce functionary Jim Lazarus in 2001. The reason is that in low-turnout elections, left-liberals vote more heavily that do conservatives, and that’s a verifiable San Francisco political fact.

But it was the 2000  supervisors races that showed just how well left-liberal forces did in run-off elections at the district level: Jake McGoldrick, Aaron Peskin, Matt Gonzales, Chris Daly, Sophie Maxwell, and Gerardo Sandoval, the very heart of the progressive majority, were elected in December run-off elections.

In 2002, three arguments were made for RCV: first, that it would reduce negative campaigning; second, that it would increase turnout in local elections and third, it would reduce costs by eliminating the run off election. Of the three  arguments only the last has been met, a dubious achievement in that even more such savings could be made by eliminating ALL elections.

Can anyone actually claim that last year’s mayoral election, the first contested one conducted under RCV, was anything but a negative free-for-all? Or, how about the 2010 D6 race between Debra Walker and Jane Kim, or the D8 race between Mandelman and Weiner? Or the 2002 D4 Ron Dudum – Ed Jew race? RCV did not end negative campaigns.

How about turnout?  Last year’s mayoral race had the lowest turnout in a contested race for mayor in the modern history of San Francisco. Every supervisorial race in 2008 had a lower turnout than  the citywide average. Turnout in 2010 was below citywide levels in the RCV supervisor races in D4, D6 and D10.

No, the record is clear RCV has not resulted in higher turnout, either.

RCV creates a political system in which candidates make deals with other candidates, behind closed doors, before the voters vote.  Runoff elections result in a system in which voters make deals with candidates AFTER they vote in the polling booth. What’s wrong with giving voters two choices in two elections instead of three choices in one election? Oh, that’s right, we save money by giving voters fewer elections.

Left-liberals tend to field fewer candidates for races than do moderates and conservatives because, especially in San Francisco, left-liberals simply don’t know how to raise political money, while moderates and conservatives do. RCV elections reward multiple candidates of the same political persuasion as these candidate can agree to appeal to their similar voters to vote for them as a block.  Thus, RCV will always favor, in an open contest in which there is no incumbent, moderate to conservative candidates because there are  usually more of them running.

That’s what happened to Avalos in last years mayoral election: he picked up nothing as the moderate candidates’ second and third votes went to the moderate Lee. The same happened in D10 two years ago: moderates voted for multiple moderate candidates and the only real left-liberal in the race did not pick up any of these votes and lost — although he outpolled the eventual, moderate winner.

RCV favors incumbents, and that’s why at least two of the Class of 2000 progressive supervisors told me they voted for it. Lets see how well it works to defeat Sup. Scott Wiener, who is far to the right of the average voter in D8, or Supervisor Malia Cohen in D10 who was supported by less than 30 percent of the election day vote.

What seems to be going on here is an incredibly silly political association game.  Because repealing RCV is supported by conservative supervisors and the Chamber of Commerce we should be opposed since they are for it. Haven’t we seen this year conservative Republicans make one self defeating political move after another?  When your enemy is threatening to shoot himself in the heard why are we trying to pull the gun away? It time to pull the trigger on RCV.

Why do Lee, Chiu, and others want to stifle economic growth?

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Why do Mayor Ed Lee, Board of Supervisors President David Chiu, and San Francisco’s two major daily newspapers want to punish success? Because that’s exactly what their proposal to create a new gross receipts tax for businesses – in which corporations would be taxed more as they grow, thus encouraging economic stagnation – would do.

Right now, the city taxes businesses through a payroll tax, levying taxes based on the number of employees the company has. But under a gross receipts tax that would replace the payroll tax, employees have a disincentive to be productive and efficient and increase their companies’ profits because that would expose those companies to more of the city’s onerous tax burden.

Why would investors and employees want to grow a business in San Francisco when that would only submit them to higher taxes. Clearly, this is anti-business measure that is likely to plunge our local economy back into the depths of the recession. Don’t our leaders understand the need to help this fragile economic recovery?

Okay, okay, in case you haven’t guessed it yet, the previous three paragraphs are satire of the ridiculously overblown and misleading political rhetoric used by Lee and other critics of the city’s payroll tax, which they deride as as “job killer” that makes companies not want to hire new employees.

“Mayor Lee and Board President David Chiu proposed a gross receipts tax as an alternative to the City’s current payroll tax, which punishes companies for growing and creating new jobs in San Francisco,” Lee’s office wrote in a press release it distributed last week.

Yet my argument that a gross receipts taxes “punishes companies for growing” is just as logically sound as Lee’s argument that the payroll tax discourages companies from “creating new jobs” – and both arguments are also complete hyperbolic bullshit. But it’s seductively simple and widely parroted bullshit.

“To attract more companies to San Francisco and encourage existing employers to hire more employees, it is past time to do away with this tax,” our new neighbors down the hall, the editors of the Examiner, wrote in their editorial today, a oft-repeatedly refrain from the Chronicle and SF Chamber of Commerce as well. It later added that switching tax methods “wouldn’t penalize companies for employing people or paying them well. And city policy wouldn’t give employers any incentive to shed employees during a downturn.”

But the reality is that the 1.5 percent payroll tax is too small to really be a factor in the decision by corporations to add new employees, something they are already loath to do unless forced to by rising demand. It is simply one imperfect gauge of the size of a company and its ability to pay local taxes, just as the gross receipts tax is.

Health insurance costs, which Lee’s CPMC deal doesn’t adequate contain, is a far bigger factor in a company’s hiring decisions. So is commercial rent, which Lee’s corporate welfare policies are causing to go up downtown and throughout the city.

For decades, conservatives have tried to sell the general public on bogus trickle down economic theories that we all benefit from corporate tax cuts and that people will simply stop working if you tax them, ideas that should have been discarded as they were discredited. But they’re back with a vengeance, in supposedly liberal San Francisco of all places, actively peddled by key Lee supporters like billionaire venture capitalist Ron Conway, who only recently dropped his Republican party affiliation in favor of declined to state.

But it’s time to call out this voodoo economics for what it is: self-serving bullshit that ought to be rejected by citizens of a city that prides itself as being more educated and enlightened than the rubes in the flyover states that have been so thoroughly manipulated by the Republican Party and Blue Dog Democrats, to the detriment of our entire country.

Now, the Examiner’s argument that the business tax reform proposal would broaden and stabilize the tax base is a sound and meaningful argument, which is why the concept enjoys widespread support from across the ideological spectrum and is worth doing (although progressives rightful argue that if the tax base is being broadened then the city should reap some benefits from that, logic that Lee inexplicably resists).

Yet as the City Hall debates that will shape the details of business tax reform begin in a couple of weeks, it’s time to drop this misleading “job killer” label that has been promulgated by Republicans and other fiscal conservatives over the last decade and have an honest debate over what’s best for San Francisco’s private and public sectors.

Guardian voices: The zombie condo converters

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What is the shelf life of  a really bad public policy concerning housing in  San Francisco?

When it comes to condo conversions of existing rent controlled apartments, the answer is that there is no limit on how many times this bad idea is taken off the shelf. Like a bad summer zombie movie, this undead keeps  walking, no matter what San Franciscans say.

A little history.  In 1982 Supervisor Willie Kennedy, not a bomb-throwing tenant advocate by any stretch, sponsored legislation that limited the  conversion of existing apartments to condos to no more than 200 a year. The measure did not touch new constriction, allowing unlimited condominium construction. Indeed, from 1983 to 2000, some 12,200 new condos were built, an average of some 680 units a year. Since 2000, nearly 100 percent of all new residential constriction is built as condos; there is no limit on renting a condo, but an annual limit in converting an existing apartment. Clearly, condos are a tenure type of housing that is dramatically expanding.

The reason Kennedy and the at-large elected Board of Supervisors voted for the annual limit was to protect rent-controlled apartments, a type of housingthat can’t be expanded. San Francisco’s 1978  rent control ordinance exempted all new construction from being under rent control. So rent-controlled apartments were a fixed number — all apartments built before 1978 — banned by law from ever being expanded. 

Yet those apartments are the largest number of affordable housing units available to moderate and middle income households. Thus, there’s a rational desire to preserve them by a public policy that limits their conversion to condos because they are declining in numbers.

And San Francisco voters understand and support this very rational policy.

In 1989, realtors and speculators tried to overturn the annual limit, proposing a measure that said if 51 percent of a building’s existing tenants voted for a conversion, then the building could be converted with no annual limit. This proposal laid out a future of a Hobbesian society here in San Francisco with one set of well-to-do tenants fighting another set of less-well-off tenants, building by building. San Francisco voters defeated the measure 63-37.

But in the land of the living dead condo converters, no is never the answer.
 
In 2002, Gavin Newsom, Tony Hall and Leland Yee, Plan C, and the Chamber of Commerce placed another measure on the ballot to repeal the annual limit. It too, was  rejected: 60 percent voted no, and 40 percent yes. The measure was defeated in all of the supervisorial districts except  Newsom’s D2, Tony Hall’s D7, and Leland Yee’s D4.

Tenant and affordable housing advocates were not unmoved by the desire of tenants, especially in privately owner rental housing facing Ellis Act and TIC evictions, to seek the protection of home ownership. In 2008 they supported an amendment to the Subdivision Code carving out from the annual limit conversions of apartments by nonprofit, limited equity housing
co-ops.

Now were are confronted again by a desire to allow more conversions of rent controlled units by private buyers who bought into the TIC dodge around the annual condo conversion limit.

Since TIC’s do not require a sub-division map, creating legally recognized separate units, they became “grey market” condos. With hot mortgage money flowing during the bubble, TIC owners could get financing. Now, banks are actually following some laws and will not lend to buy a legally grey TIC.  Thus the move to get them converted to legal condos.
 
This is, in its most basic form, yet another bailout caused by speculative capitalism. We seem to no longer believe in the market as an economic system, in which bad economic decisions result in economic loss for the folks involved. We now seem to believe in the “market society” — in which those with money get to keep it no matter what bad decisions they make.

What this is all about is not really homeownership but about home sales. After all, if you have a TIC you already have a home. You want to convert it to a condo not to live in, but to sell. To make it easier to sell TICs would make it harder to sell the thousands of already approved but stalled new condos.

Mayor Lee administration want to stimulate these stalled condo developments, claiming they will create constriction jobs. The Farrell and Wiener condo conversion plan undercuts these efforts and, of course, will create no jobs for anyone but realtors and moving companies.

This is called a “contradiction of capitalism,” when one set of capitalists seek, to the disadvantage of another group of capitalists, to get the government to intervene on their behalf.  But it does prove once again that Lenin was right when he said that one could count on one set of capitalists to compete with each other to sell rope to hang another set.

It’s really bad economic policy, and even worse housing policy.

Hospital standoff

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steve@sfbg.com

The controversial and long-awaited proposal by California Pacific Medical Center (CPMC) to build a 550-bed luxury hospital atop Cathedral Hill and to rebuild St. Luke’s Hospital has finally arrived at the Board of Supervisors — where it appears to have little support.

So far, not one supervisor has stepped up to sponsor the deal, and board members say it will have to undergo major changes to meet the city’s needs. “There are still a lot of questions that remain,” Sup. David Campos told us, citing labor, housing, community benefits, and a long list of other issues that he doesn’t believe CPMC has adequately addressed. “It tells me there’s still more work to be done.”

CPMC, which is Sacramento-based nonprofit corporation Sutter Health’s most lucrative affiliate, has been pushing the project for almost a decade. Its advocates have subtly used a state seismic safety deadline for rebuilding St. Luke’s — a hospital relied on by low-income residents of the Mission District and beyond — as leverage to build the massive Cathedral Hill Hospital it envisions as the Mayo Clinic of the West Coast.

But the project’s draft environmental impact report shows the Cathedral Hill Hospital would have huge negative impacts on the city’s transportation system and exacerbate its affordable housing crisis. And CPMC has been in a pitched battle with its labor unions over its refusal to guarantee the new jobs will go to current employees or local residents and be unionized. There are also concerns with the market power CPMC will gain from the project, how that will affect health care costs paid by the city and its residents, and with the company’s appallingly low charity care rates compared to other health care providers (see “Lack of charity,” 12/13/11).

CPMC had refused to budge in negotiations with the Mayor’s Office under two mayors, for which Mayor Ed Lee publicly criticized the company’s intransigence last year. But under pressure from the business community and local trade unions who support the project, Lee cut a deal with CPMC in March.

That development agreement for the $2.5 billion project calls for CPMC to pay $33 million for public transit and roadway improvements, $20 million to endow community clinics and other social services, and $62 million for affordable housing programs, nearly half of which would go toward helping its employees buy existing homes.

While those numbers seem large, community and labor leaders from San Franciscans for Healthcare, Housing, Jobs and Justice (SFHHJJ), which formed in opposition to the project, say they don’t cover anywhere near the project’s full impacts. And given that CPMC made about $180 million in profit last year in San Francisco alone — money that subsidizes the rest of Sutter’s operations — they say the company can and should do better.

“This is about standing up to corporate blackmail,” SFHHJJ member Steve Woo, a community organizer with the Tenderloin Neighborhood Development Corporation, told us.

 

PIVOTAL PROJECT

CPMC is perhaps the most high-profile project the board will consider this year, one that will impact the city for years, so the political and economic stakes are high.

The Planning Commission voted 5-1 on April 26 to approve the deal and its environmental impact report, citing the project’s economic benefits and the looming deadline for rebuilding St. Luke’s. The Board of Supervisors was scheduled to consider the appeal of that decision on June 12 (after Guardian press time), but activists say supervisors planned to continue the item until July 17.

In the meantime, the board’s Land Use Committee has scheduled a series of hearings on different aspects of the project, starting June 15 with a project overview and presentation on the jobs issue, continuing June 25 with a hearing on its impacts to the health care system. Traffic and neighborhood impacts would be heard the next week, and then housing after that.

Calvin Welch, a progressive activist and nonprofit affordable housing developer, said the project’s EIR makes clear just how paltry CPMC’s proposed mitigation measures are. It indicates that the project’s 3,000 new workers will create a demand for at least 1,400 new two-bedroom housing units. Even accepting that estimate — which Welch says is low given that many employees have families and won’t simply be bunking with one another — the $26 million being provided for new housing construction would only create about 90 affordable studio apartments.

“We’re going to end up, if we want to house that workforce, subsidizing CPMC,” Welch told us.

Compounding that shortcoming is the fact that the Cathedral Hill Hospital is being built in a special use district that city officials established for the Van Ness corridor — where there is a severe need for more housing, particularly affordable units. The SUD calls for developers to build three square feet of residential for every square foot of non-residential development.

“That would require building 3 million square feet of residential housing with this project,” Welch said. “We don’t think $26 million meets the housing requirement for this project, let alone what was envisioned by this [Van Ness corridor] plan.”

SFHHJJ is calling for CPMC to provide at least $73 million for affordable housing, with no more than 20 percent of that going to the company’s first-time homebuyer assistance program. That assistance program does nothing to add to the city’s housing stock and critics call it a valuable employee perk that will only increase the demand for existing housing — and thus drive up prices.

But the business community is strongly backing the deal, and the trade unions are expected to turn out hordes of construction workers at the hearing to make this an issue of jobs — rather than a corporation paying for its impacts to the community.

“After a decade of discussion, debate and compromise, the city’s departments, commissions, labor, business and community groups all agree on CPMC,” San Francisco Chamber of Commerce President Steve Falk wrote in a June 8 e-mail blast entitled “Message to the Board of Supervisors: Don’t Stand in the Way of Progress.”

“The fate of our city’s healthcare infrastructure now lies solely with the Board of Supervisors,” the Chamber says. “When it comes time to vote, let’s insist they make the right choice.”

Yet it’s simply inaccurate to say that labor and community groups support the deal, and both are expected to be well-represented at the hearings.

 

CARE FOR WHOM?

Economic justice issues related to health care access and costs are another potential pitfall for this project. SFJJHH activists note that no supervisors have signed on to sponsor the project yet — which is unusual for something this big — and that even the board’s most conservative supervisors have raised concerns that the city’s health care costs aren’t adequately contained by the deal.

“There’s a significant amount of dissatisfaction with the deal, even among conservatives,” SFJJHH member Paul Kumar, a spokesperson for the National Union of Healthcare Workers, told the Guardian.

On the progressive side, a big concern is that CPMC is proposing to rebuild the 220-bed St. Luke’s with only 80 beds, which activists say is not enough. And even then, CPMC is only agreeing to operate that hospital for 20 years, or even less time if Sutter’s fortunes turn around and the hospital giant begins losing money.

CPMC Director of Communications Kathryn Graham, responding by email to questions and issues raised by the Guardian, wrote generally and positively about CPMC and the project without addressing the specific concerns about whether housing, transportation, and other mitigation payments are too low.

On the jobs issue, she wrote, “Our project will create 1,500 union construction jobs immediately—and preserves and protects the 6,200 health care professional jobs that exist today at the hospitals. Currently, nearly 50 percent of our current employees live in San Francisco. During the construction phase of this project, we are committed to hire at least 30 percent of workers from San Francisco. We will create 500 permanent new jobs in just the next five years—200 are guaranteed to be local hires from underserved San Francisco neighborhoods. We don’t know where you got the ridiculous idea that our employees must reapply for jobs at our new hospitals. That is incorrect.”

Yet CPMC has resisted requests by the California Nurses Association and other unions to be recognized at the new facility or to agree to card-check neutrality that would make it easier to unionize. And union representatives say CPMC has offered few assurances about staffing, pay, seniority, and other labor issues.

As one CNA official told us, “If they aren’t going to guarantee jobs to the existing employees, those are jobs lost to the city.”

“We’re giving Sutter a franchise over San Francisco’s health care system for 30 to 40 years, so we should ensure there are basic worker and community protections,” Kumar said.

Welch and other activists say they believe CPMC is prepared to offer much more than it has agreed to so far, and they’re calling on the supervisors to be tougher negotiators than the Mayor’s Office was, including being willing to vote down the project and start over if it comes down to that.

“They make too much money in this city to just leave town,” Welch said of CPMC’s implied threat to pull out of San Francisco and shutter St. Luke’s. “It’s bullshit.”

The funny money against Prop. B

19

Credit where it’s due: My competitor and sometimes journalistic adversary Joe Eskenazi has a nice little piece on the weird money behind the campaign against Prop. B, a policy statement about the privatization of Coit Tower. He points out that such varied groups as the California Dental Association and the San Manuel Band of Mission Indians have coughed up money to protect the right of San Francisco officials to close Coit Tower to the public and rent it out for fancy corporate parties.

And how exactly did that happen?

Well, Eskenazi manages to tie Willie Brown into it. (He also calls this “Nimby against the Swells,” which isn’t quite fair — I don’t think the supporters of Prop. B are trying to keep anything out of their back yards. If anything, they want more noisy tourists and fewer quiet, subdued rich-people events. And I don’t think the “swells” are against it as much as the mayor, his Rec-Park director and big businesses that generally back the privatization of public resources.)

But there’s another interesting twist: I’m not sure the folks who gave to the Golden State Leadership Fund Political Action Committee, which is running a No on B independent expenditure, had any clue where their money was going.

Sure, the Chamber of Commerce and BOMA know what’s up, and it’s pretty clear why they like the idea of raising money for the parks by holding exclusive private events instead of by raising taxes. But the Indians? And the dentists? By what possible stretch do they care about a San Francisco ballot measure that has nothing to do with Native American rights or oral health?

Eskenazi may be right — maybe Brown called the Indians and asked, and they threw the money his way to help his buddy the mayor (while keeping the mayor’s fingers out of this particular political pie). But the Golden State Leadership PAC, through which all this money flowed, has been around for years and gives money to candidates all over the state. (It’s definately something of a slush fund for local races — files in the Secretary of State’s office show that in 2008, money from Pacific Gas and Electric Co. flowed in and out of the PAC as it ran a campaign against the San Francisco public-power measure, Prop. H. PAC money went to David Chiu, Phil Ting and Ed Lee for mayor.) It’s based in West Hollywood and the treasurer is a guy named William Molina.

I called the San Manuel Band of Mission Indians and the California Dental Association and asked them why there were helping fund a campaign against Prop. B in San Francisco. The press person at the dental group apparently had no idea what I was talking about and asked for more details about the contribution. I gave her the date and the PAC and I haven’t heard back.

The Indians didn’t seem to clear on Prop. B, either. Kenneth Shoji, a spokesperson for the group, told me by email:

The San Manuel Band of Mission Indians made a contribution of $25,000 to the Golden State Leadership Fund PAC with the expectation of helping to support candidate(s) for public office in the 2012 elections.  We do not control where or how the PAC might extend its support beyond that.

In other words: This Coit tower thing is news to us.

UPDATE: I got essentially the same message from the dentists. Alicia Malaby at the CDA writes:

 When an organization such as CalDPAC contributes to an independent expenditure committee, that committee may spend money on races and issues that CalDPAC supports, but may also spend money on other campaigns. CalDPAC does not control how those committees spend money, and in this case, CalDPAC has no interest in and no position on Proposition B.

UPDATE TWO: Ron Cottingham at PORAC just called me and said his group has no position on or interest in Prop. B. The money that went to the PAC was earmarked to support Rob Bonta for Assembly in the East Bay. Presumably the PAC folks keep track of such things.

Maybe not. Maybe Willie or someone else made a call. It happens all the time.  I mean, somebody clearly was raising money for this PAC, which right now isn’t doing a hell of a lot besides No on B in San Francisco. (Oh, I called Brown, too. He hasn’t called back. He never does. I still always try.)

Either way, it’s a classic San Francisco political story — and it reflects how muddy and corrupt local politics can still be, even in an era of electronic disclosure and ethics laws. Why, if the dentists and Indians don’t like Prop. B, didn’t they (or any of the others in the PAC) create a No on B committee, disclose who was behind it and let the voters know a little more about the real money trail? Why funnel all this cash through a little-known Southern California PAC?

And for that matter, why is there a sudden influx of late money in this race? Has the mayor and the Chamber types suddenly discovered that Prop. B might pass — and might set a precedent against future privatization efforts?

June 5 is Election Day. Vote early and often.

 

 

 

 

 

The battle of 8 Washington

tredmond@sfbg.com

More than 100 people showed up May 15 to testify on a condominium development that involves only 134 units, but has become a symbol of the failure of San Francisco’s housing policy.

I didn’t count every single speaker, but it’s fair to say sentiment was about 2-1 against the 8 Washington project. Seniors, tenant advocates, and neighbors spoke of the excessive size and bulk of the complex, the precedent of upzoning the waterfront for the first time in half a century, the loss of the Golden Gateway Swim and Tennis Club — and, more important, the principle of using public land to build the most expensive condos in San Francisco history.

Ted Gullicksen, director of the San Francisco Tenants Union, calls it housing for the 1 percent, but it’s worse than that — it’s actually housing for the top half of the top half of the 1 percent, for the ultra-rich.

It is, even supervisors who voted in favor agreed, housing the city doesn’t need, catering to a population that doesn’t lack housing opportunities — and a project that puts the city even further out of compliance with its own affordable-housing goals.

And in the end, after more than seven hours of testimony, the board voted 8-3 in favor of the developer.

It was a defeat for progressive housing advocates and for Board President David Chiu — and it showed a schism on the board’s left flank that would have been unthinkable a few years ago. And it could also have significant implications for the fall supervisorial elections.

Sup. Jane Kim, usually an ally of Chiu, voted in favor of the project. Sup. Eric Mar, who almost always votes with the board’s left flank, supported it, too, as did Sup. Christina Olague, who is running for re-election in one of the city’s most progressive districts.

At the end of the night, only Sups. David Campos and John Avalos joined Chiu in attempting to derail 8 Washington.

The battle of 8 Washington isn’t over — the vote last week was to approve the environmental impact report and the conditional use permit, but the actual development agreement and rezoning of the site still requires board approval next month.

Both Mar and Olague said they were going to work with the developer to try to get the height and bulk of the 134-unit building reduced.

But a vote against the EIR or the CU would have killed the project, and the thumbs-up is a signal that opponents will have an upward struggle to change the minds of Olague, Kim, and Mar.

 

DEFINING VOTES

The 8 Washington project is one of a handful of defining votes that will happen over the next few months. The mayor’s proposal for a business tax reform that raises no new revenue, the budget, and the massive California Pacific Medical Center hospital project will force board members to take sides on controversial issues with heavy lobbying on both sides.

In fact, by some accounts, 8 Washington was a beneficiary of the much larger, more complicated — and frankly, more significant — CPMC development.

The building trades unions pushed furiously for 8 Washington, which isn’t surprising — the building trades tend to support almost anything that means jobs for their members and have often been in conflict with progressives over development. But the Hotel and Restaurant Employees Union joined the building trades and lined up the San Francisco Labor Council behind the deal.

And for progressive supervisors who are up for re-election and need union support — Olague and Mar, for example — defying the Labor Council on this one was tough. “Labor came out strong for this, and I respect that,” Olague told me. “That was a huge factor for me.”

She also said she’s not thrilled with the deal — “nobody’s jumping up and down. This was a hard one” — but she thinks she can get the developer to pay more fees, particularly for parking.

Kim isn’t facing re-election for another two years, and she told me her vote was all about the $11 million in affordable housing money that the developer will provide to the city. “I looked at the alternatives and I didn’t see anything that would provide any housing money at all,” she said. The money is enough to build perhaps 25 units of low- and moderate-income housing, and that’s a larger percentage than any other developer has offered, she said.

Which is true — although the available figures suggest that Simon Snellgrove, the lead project sponsor, could pay a lot more and still make a whopping profit. And the Council of Community Housing Organizations, which represents the city’s nonprofit affordable housing developers, didn’t support the deal and expressed serious reservations about it.

Several sources close to the lobbying effort told me that the message for the swing-vote supervisors was that labor wanted them to approve at least one of the two construction-job-creating developments. Opposing both CPMC and 8 Washington would have infuriated the unions, but by signing off on this one, the vulnerable supervisors might get a pass on turning down CMPC.

That’s an odd deal for labor, since CPMC is 10 times the size of 8 Washington and will involve far more jobs. But the nurses and operating engineers have been fighting with the health-care giant and there’s little chance that labor will close ranks behind the current hospital deal.

Labor excepted, the hearing was a classic of grassroots against astroturf. Some of the people who showed up and sat in the front row with pro-8 Washington stickers on later told us they had been paid $100 each to attend. Members of the San Francisco Planning and Urban Research Association, to which Snellgrove has donated substantial amounts of money in the past, showed up to promote the project.

 

BEHIND THE SCENES

But the real action was behind the scenes.

Among those pushing hard for the project were Chinese Chamber of Commerce consultant Rose Pak and community organizer David Ho.

Pak’s support comes after Snellgrove spent years courting the increasingly powerful Chinatown activist, who played a leading role in the effort that got Ed Lee into the Mayor’s Office. Snellgrove has traveled to China with her — and will no doubt be coughing up some money for Pak’s efforts to rebuild Chinese Hospital.

Ho was all over City Hall and was taking the point on the lobbying efforts. Right around midnight, when the final vote was approaching, he entered the board chamber and followed one of Kim’s aides, Matthias Mormino, to the rail where Mormino delivered some documents to the supervisor. Several people who observed the incident told us Ho appeared to be talking Kim in an animated fashion.

Kim told me she didn’t actually speak to Ho at that point, although she’d talked to him at other times about the project, and that “nothing he could have said would have changed anything I did at that point anyway.” Matier and Ross in the San Francisco Chronicle reported that Ho was heard outside afterward saying “don’t worry, she’s fine.”

Matier and Ross have twice mentioned that the project will benefit “Chinatown nonprofits,” but there’s nothing in any public development document to support that assertion.

Chiu told me that no Chinese community leaders called him to urge support for 8 Washington. The money that goes into the affordable housing fund could go to the Chinatown Community Development Corp., where Ho works, but it’s hardly automatic — that money will go into a city fund and can’t be earmarked for any neighborhood or organization.

CCDC director Norman Fong confirmed to me that CCDC wasn’t supporting the project. In fact, Cindy Wu, a CCDC staffer who serves on the city Planning Commission, voted against 8 Washington.

I couldn’t reach Ho to ask why he was working so hard on this deal. But one longtime political insider had a suggestion: “Sometimes it’s not about money, it’s about power. And if you want to have power, you need to win and prove you can win.”

Snellgrove will be sitting pretty if 8 Washington breaks ground. Since it’s a private deal (albeit in part on Port of San Francisco land) there’s no public record of how much money the developer stands to make. But Chiu pointed out during the meeting, and confirmed to me later by phone, that “there are only two data points we know.” One is that Snellgrow informed the Port that he expects to gross $470 million in revenue from selling the condos. The other is that construction costs are expected to come in at about $177 million. Even assuming $25 million in legal and other soft costs, that’s a huge profit margin.

And it suggests the he can well afford either to lower the heights — or, more important, to give the city a much sweeter benefits package. The affordable housing component could be tripled or quadrupled and Snellgrove’s development group would still realize far more return that even the most aggressive lenders demand.

Chiu said he’s disappointed but will continue working to improve the project. “While I was disappointed in the votes,” he said, “many of my colleagues expressed concerns about height, parking, and affordable housing fees that they can address in the upcoming project approvals.”

So what does this mean for the fall elections? It may not be a huge deal — the symbolism of 8 Washington is powerful, but if it’s built, it won’t, by itself, directly change the lives of people in Olague’s District 5 or Mar’s District 1. Certainly the vote on CPMC will have a larger, more lasting impact on the city. Labor’s support for Mar could be a huge factor, and his willingness to break with other progressives to give the building trades a favor could help him with money and organizing efforts. On the other hand, some of Olague’s opponents will use this to differentiate themselves from the incumbent. John Rizzo, who has been running in D5 for almost a year now, told me he strongly opposed 8 Washington. “It’s a clear-cut issue for me, the wrong project and a bad deal for the city.” London Breed, a challenger who is more conservative, told us: “I would not have supported this project,” she said, arguing that the zoning changes set a bad precedent for the waterfront. “There are so many reasons why it shouldn’t have happened,” she said. And while Mar is in a more centrist district, support from the left was critical in his last grassroots campaign. This won’t cost him votes against a more conservative opponent — but if it costs him enthusiasm, that could be just as bad.

Tax equity

3

steve@sfbg.com, yael@sfbg.com

A broad consensus in San Francisco supports reforming the city’s business-tax structure by replacing the payroll tax with a gross receipts tax through a November ballot measure. But the devil is in the details of how individual tax bills are affected, which has divided the business community and given a coalition of labor and progressives the opportunity to overcome the insistence by Mayor Ed Lee and other pro-business moderates that any change be revenue-neutral.

Service Employees International Union Local 1021, San Francisco’s biggest city employee union, last month launched a campaign demanding that the measure increase city revenue, setting a goal of at least $50 million, which represents the amount the city has lost annually since 2001 when 52 large downtown corporations sued to overturn the last gross receipts tax. The union is threatening to place a rival measure on the fall ballot.

“This call for it to be revenue-neutral didn’t make a lot of sense given all the reductions in city services in recent years,” said Chris Daly, the union’s interim political director. “It’s fair to at least get the money back that we lost in 2001.”

The union and the city recently agreed on a new contract that avoids more of the salary cuts that SEIU members have taken in recent years, but workers could still face layoffs under a new city budget that Lee is scheduled to introduce June 1. Lee, Board of Supervisors President David Chiu, and business leaders working on the tax-reform proposal have until June 12 to introduce their ballot measure.

But they don’t yet have an agreement on what the measure should look like — largely because the technology sector (led by billionaire venture capitalist Ron Conway, the biggest fundraiser for Lee’s mayoral campaign last year), the traditional businesses represented by the San Francisco Chamber of Commerce, and the small business community are pushing different interests and priorities.

“The technology industry has to realize they have a tax obligation like any member of the business community does,” Jim Lazarus, the Chamber’s vice president for public policy, told us.

Conway is reportedly using his influence on Lee to push for a model that keeps taxes low for tech companies — even if that comes at the expense of other economic sectors, such as commercial real estate and big construction firms, which will likely see their tax obligations increase. Yet some Chamber counter-proposals could end up costing small businesses more money, creating a puzzle that has yet to be worked out.

But one thing is clear: The business leaders don’t want to see overall city revenue increase. “If there’s anything that is unifying in the business community is that it’s revenue neutral,” small business advocate Scott Hauge told us. “We’re not going to increase revenues, that’s just a given, so if we have to do battle then so be it.”

SEIU and other members of progressive revenue coalition that has been strategizing in recent weeks are hoping to exploit the divisions in the business community and arrive at a compromise that increases revenue, and if not then they say they’re willing to go to the ballot with a rival measure.

“We’re working on trying to recover what we lost in the 2001 settlement and then some,” Sup. John Avalos, who has been working with the progressive coalition, told us. “We have to have something going to the ballot that is revenue generating.”

 

 

LABOR’S CAMPAIGN

For labor and progressives, this is an equity issue. Workers have been asked to give back money, year after year, despite the fact that big corporations have been doing well in recent years but haven’t contributed any of that wealth to the cash-strapped city. Labor leaders say that after they supported last year’s pension-reform measure, it’s time for the business community to support city services.

“When we talked about Prop C, we said if our members are doing this with our pensions now, we’ll see next year what businesses do with business tax,” said Larry Bradshaw, vice president of SEIU Local 1021. “Then we read about secret meetings where the labor movement was excluded from those talks.”

Anger over the “secret meetings” of business leaders that Lee assembled to craft the tax reform measure — meetings at which no labor leaders were included — helped inspire the fierce protest campaign that defined the SEIU’s recent contract negotiations.

In the first weeks of negotiations, workers were already up in arms. Protest marches at SF General Hospital and Laguna Honda Hospital brought hundreds of hospital workers to the streets. These hospitals serve some of the city’s poorest populations: Laguna Honda patients are mostly seniors on Medi-Cal and General is the main public hospital serving the city’s poor.

On April 5, city workers got creative with a street theater protest that involved six-story projections on the iconic Hobart Building. Protesters dressed as rich CEOs and handed out thank-you cards to commuters at the Montgomery transit station. SEIU’s “The City We Need, Not Downtown Greed” campaign included a website (www.neednotgreed.org), slick video, and direct mailers portraying CEOs as panhandlers on the street asking city residents, “Can you spare a tax break?”

The most dramatic civil disobedience came on April 18, when more than 1,000 workers rallied outside City Hall — along with several progressive supervisors — and then marched to Van Ness and Market. Protesters blocked the street, resulting in 23 arrests. At that point, increases in health care cuts and pay cuts to city workers were still on the table.

That was followed the next week by hundreds of workers staging noisy demonstrations in City Hall, and then again on May Day when SEIU workers were well represented in actions that took over parts of the Financial District.

In the end, the demands of union representatives were met in the contract agreement. Health care cost increases and pay cuts were eliminated, and a 3 percent pay raise will kick in during the two-year contract’s second year, a deal overwhelmingly approved by union members. Labor leaders hope to use that momentum to force a deal with the Mayor’s Office on the tax reform measure — which some sources say is possible. Otherwise, they say the campaign will continue.

“We may end up on the streets gathering signatures soon,” Daly said. “We need to figure it out in the next few weeks.”

 

 

THOSE DEVILISH DETAILS

The Controller’s Office released a report on May 10 that made the case for switching to a gross receipts tax and summed up the business community’s meetings, and the report was the subject of a joint statement put out by Lee and Chiu. “After months of thorough analysis, economic modeling and inclusive outreach to our City’s diverse business community, the City Controller and City Economist have produced a report that evaluates a gross receipts tax, a promising alternative to our current payroll tax, which punishes companies for growing and creating new jobs in our City'” the statement said. “Unlike our current payroll tax, a gross receipts tax would deliver stable and growing revenue to fund vital city services, while promoting job growth and continued economic recovery for San Francisco.”

Daly and Avalos say progressives agree that a gross receipts tax would probably be better than the payroll tax, and they say the controller’s report lays out a good analysis and framework for the discussions to come. But despite its detailed look at who the winners and losers in the tax reform might be, Daly said, “We haven’t seen an actual proposal yet.”

Lazarus made a similar statement: “Nobody likes the payroll tax, but the devil is in the details.”

But it’s clear some businesses those with high gross receipts but low payrolls — would pay more taxes. For example, the finance, insurance, and real estate sector now pays about 16 percent of the $410 million the city collects in payroll taxes. That would go up to about 21 percent under a gross receipts tax.

“Several industries that could face higher taxes under the proposal, such as commercial real estate, large retailers, and large construction firms, felt the increase was too sharp,” the report said under the heading of “Policy Issues Arising From Meetings with Businesses.”

The report highlighted how the change would broaden the tax base. Only about 7,500 businesses now pay the payroll tax (others are either too small or are exempt from local taxation, such as banks), whereas 33,500 companies would pay the gross receipts tax, which the report identified as another issue to be resolved.

“While some businesses appreciated the base-broadening aspect of the gross receipts proposal, others felt that too many small businesses were being brought into the Gross Receipts tax,” the report said. Hauge also told us that he fears a tax increase on commercial real estate firms could be passed on to small businesses in the form of higher rents. “I don’t want to see the business community split,” Hauge said, although it’s beginning to look like that might be unavoidable. The big question now is whether progressives and labor can find any allies in this messy situation, and whether they’ll be able to agree on a compromise measure that all sides say is preferable to competing measures.

Dick Meister: Union rights are civil rights

15

By Dick Meister

Dick Meister, former labor editor of the SF Chronicle and KQED-TV Newsroom, has covered labor and politics for more than a half-century. Contact him through his website, www.dickmeister.com, which includes more than 350 of his columns.

The right of U.S. workers to organize and bargain collectively with their employers unhindered by employer or government interference has been a legal right since the 1930s. Yet there are workers who are unaware of that, and employers who aim to keep them unaware, meanwhile doing their utmost to keep them from exercising what is a basic civil right.

Many employers often claim working people are in any case not much interested in unionization, noting that less than 15 percent of workers currently belong to unions.

But as anyone who has looked beneath the employer claims has discovered, it’s the illegal opposition of employers and the failure of government regulatory agencies to curtail the opposition that’s the basic cause of the low rate of unionization.

If most workers do indeed oppose unionization, then what of the recent polls decisively showing otherwise? And why do so many employers go to the considerable trouble and expense of waging major campaigns against unionization ? Why do they take such illegal actions as firing or otherwise penalizing union supporters?

Could it be that union campaigners might be able to persuade workers to vote for unionization, despite what their employers might have to say? Or despite employer threats to punish them for voting union?

Some employers have now taken the outrageous step of trying to keep employees from even knowing of their legal right to unionization.

Under a National Labor Relations Board ruling last August, employers were to be required as of this April to post notices at their workplaces telling employees of their union rights.

The ruling stemmed from the labor board’s finding that young workers, recent immigrants and workers in non-union workplaces were generally unaware of the labor laws’ guarantees and protections – including, of course, the basic right of workers to unionize.

As the New York Times observed, “the backlash was furious.” The notoriously anti-union National Association of Manufacturers and U.S. Chamber of Commerce filed suits in two federal courts, claiming the law does not expressly permit the NLRB to require employers to post such notices. An appeals court has postponed the effective date of the rule pending further appeals.

The Times noted that the case involves more than “the legality of having to hang a poster in the coffee room. It’s about industry’s attempt to delay rules whenever it cannot derail them outright. It is about preventing workers from gaining knowledge and support to help them press their concerns.”

So unless and until a court rules otherwise, workers will have the right to protections from the labor laws, but not the right to be informed of that through workplace notices and otherwise. Bizarre, certainly, is the word for that.

What workers need above all, even above the right to know their legal rights, is a firm strengthening of those rights. Why not add the right of unionization specifically to the Civil Rights Act? It is, after all, on a par with other basic civil rights such as the right to an education free of discrimination.

The Civil Rights Act, which makes it illegal to discriminate against workers on the basis of their race, ethnicity, gender, religion or national origin, should be expanded to include a specific prohibition of discrimination against pro-union workers.

No less a civil rights champion than Martin Luther King Jr. would agree to that. He knew that the right to unionization is one of the most important civil rights. Virtually his last act was in support of that. For he was slain by an assassin’s bullet in 1968 as he was preparing to lead yet another of the many demonstrations he had led in behalf of striking black sanitation workers in Memphis who were demanding union recognition.

That was but one of many examples of King’s support for workers seeking union recognition as their civil right – a right guaranteed not only by the 77-year-old National Labor Relations Act but also by the Constitution’s First Amendment guarantee of freedom of association.

King declared that the needs of all Americans “are identical with labor’s needs: Decent wages, fair working conditions, livable housing, old-age security, health and welfare measures, conditions in which families can grow, have education for their children, and respect in the community.”

There could be no civil right greater than the right of working people to try to meet such paramount needs, as well as to be clearly informed of their right to

do so through unionization.

Dick Meister, former labor editor of the SF Chronicle and KQED-TV Newsroom, has covered labor and politics for more than a half-century. Contact him through his website, www.dickmeister.com, which includes more than 350 of his columns.

A teachable moment

2

caitlin@sfbg.com

HERBWISE On the occasion of leaving our gentle green bubble in the Bay, I often find myself in the position of explaining what it is I write about. Sometimes I am satisfied with focusing on my federally legal interests as the Guardian’s culture editor. But other times I am compelled to stretch the limits of my extended family’s imagination, which usually leads to some pretty interesting conversations.

I’m sure I’m not the only person interested in demystifying cannabis issues to their loved ones. Which is why I’m happy to introduce you to a 2011 documentary that might prove useful: Lynching Charlie Lynch, a DVD release you can find on Amazon or director Rick Ray’s website (www.rickrayfilms.com). The film even starts with a world history of cannabis usage: look guys, early Mormons used the stuff!

Charlie Lynch is a total goober (a word I use lovingly.) A suburbanite from Arroyo Grande, Calif., Lynch takes pleasure in winning stuffed animals from claw machines and rocking out to self-penned anti-drunk driving ballads in his DIY home studio. When he began medicating for his atrocious migraines with cannabis, Lynch decided to open a dispensary close to his home town, eventually starting one in 10,000-person Morro Bay. It was the only dispensary in San Luis Obispo County.

http://www.youtube.com/watch?v=ZzFsSx84EE4

Ray shows us Lynch’s adorably earnest and thorough process of setting up shop. Lynch goes so far as to call the DEA office, and is directed to four different numbers before an agent gruffly tells him that cities and counties are tasked with “dealing” with such enterprises. Thus enthused, Lynch obtains proper permitting from city and county administrations and holds a ribbon-cutting ceremony. The mayor and other city officials attend, the chamber of commerce is represented in cheerful photos from that day.

At this point one might pause the film and explain to friends and family that the California medical marijuana industry is not without its complicated issues, and that despite his phone calls, Lynch might have expected trouble from the federal government. But these caveats aside, what happens next is awful enough that “might-haves” and “could-dos” will probably dissipate from their minds.

A San Luis Obispo sheriff’s RV surveils patients and staff coming and going from Central Coast Compassionate Caregivers until sufficient evidence is gathered to obtain a federal search warrant. Your educational audience will cringe as law enforcement raids not just Lynch’s dispensary, but his home. He is taken into federal custody and released only when his family posts $400,000 in bail. There’s a media storm, the feds threaten his landlord, the business is ruined, and finally, Lynch puts his house — the same one where he once warbled cautionary notes to drunk drivers — on the market.

It is worthwhile to note that the Morro Bay raid occurred in 2007, and as an update to the fam you might want to mention the Oaksterdam debacle last month. (A scene from the Oakland cannabis school is included in Lynching Charles Lynch — prophetically, it is an in-class roleplay meant to teach students how to interact with federal agents.)

We say in the Bay Area that we are the epicenter of the cannabis movement, which in some senses may be true. But in some ways it’s not. Regardless of how conscious we are in Oakland, Marin, and San Jose of the hypocrisy of the federal government, national change is not going to take place until awareness of the issue is raised nationally.

Or maybe I’m just trying to justify that post-Lynching joint with my aunt in Maryland. Meh!

What’s going on for Bay Area May Day?

6

UPDATE: The Golden Gate Labor Coalition has announced a change of plans. Instead of Golden Gate Bridge pickets, the coalition will be supporting a strike of ferry workers, who plan to bring all morning ferry service to a standstill. They have announced that the actions at the Golden Gate Bridge are cancelled, and instead workers will be demonstrating in solidarity with ferry workers in Larkspur- specific locations will be announced later today.

May 1, International Workers Day — May Day — used to strike fear into the hearts of bosses. The first May Day in 1867 was a fight for the eight-hour workday in Chicago (see more history at Citizen Radio at the Occupy Oakland Tribune). Since then, May 1 has remained a day when grievances are aired, when students and workers party in the street, when people strike in ways that shows whose really boss (you can’t have that work that keeps everything running without all those workers.) But mostly in other countries.

In the US, the day has diminished in importance, although it has resurged in recent years focused on immigrants rights. But what with Occupy Wall Street, labor and union organizing ramping up, and student strikes, and all these people working more and more closely together, May Day is coming back to the US.

The Bay Area certainly won’t be left out. Here is a list of May Day events, starting tonight and ending–well, who knows when. If you know of others, write them in the comments: it wouldn’t be a decentralized massive attempt at a full-on general strike without you!

THE NIGHT BEFORE (Mon/30)

5:30pm, San Francisco:

City workers from SEIU Local 1021 will gather at City Hall in a continued offensive surrounding their ongoing contract negotiations. The program runs until 7:30 pm, but the protest will go on “until they kick us out!”

8pm, San Francisco:

“The strike starts early” with a gathering at Dolores Park. According to a press release, demonstrators will meet “for a ruckus street party to counter gentrification, capitalism, and the policing of our communities.” www.strikemay1st.com/the-strike-starts-early

MAY DAY (Tue/1)

All day:

National Nurses United/California Nurses United is on strike at Sutter Health locations throughout the Bay Area. According to a press release, “some 4,500 RNs will be affected by the planned walk-out.”

ILWU Local 10, which worked in solidarity with Occupy Oakland in two port shutdowns last fall, is planning another one. They say that a work stoppage will halt the Port of Oakland’s operations all day.

7-10am, San Francisco:

The Golden Gate Bridge labor coalition, representing several unions of workers on the bridge, have been without a contract since April 2011. They originally called for a strike and resulting shut down of the bridge- and had massive support behind them. They’re now saying the protest will involve picketing at the bridge instead. So come join a picket, or if you cross the bridge don’t take the workers for granted- the bridge doesn’t work without them. www.occupythebridge.com

7am, San Francisco:

Meet at 16th st and Mission to be a part of the first SF Bike Cavalry of the day, a critical mass that will ride to the Golden Gate Bridge in solidarity with the picket. www.sfbikecavalry.org

8:30am – 12pm, Oakland:

Occupy Oakland will join others protesting, picketing, and generally striking at three (or four?) “action stations.” Meet at Snow Park for a “flying picket” that will “shut down banks and the Chamber of Commerce.” Meet at First and Broadway to “occupy Child Protective Services” in response to a decision they made to de-grant custody of one woman’s children based in part on her involvement in Occupy Oakland. Meet at 22nd and Telegraph to cause mayhem at uptown and downtown business associations. www.strikemay1st.com/119/

10am, San Francisco:

A rally and march for immigrants rights (the people who have been holding down US May Day for years.) Meet at 24th St Mission Bart for a march to 16th St. 

11am, San Francisco:

Janitors and retail workers at Westfield Mall are engaged in an ongoing labor dispute, and they’ll be picketing in solidarity at 5th and Market. 

11am, San Francisco:

A second SF Bike Cavalry will convene at Justin Herman Plaza to support the janitors strike, the immigrants’ rights march, and the Peoples Street Festival

11:30am, Hayward:

The Amalgameted Transit Union Local 192 will protest “substandard conditions” and “institutionalized racism” (according to a press release) at the operators of AC Transit, A-Para Transit Corporation, 22990 Clawiter Rd in Hayward.

12pm, San Francisco:

All the San Francisco students who walk out of school, workers who call in sick, people who usually do all the housework, who, for the day, say screw it, and other “general strike” participants will converge at Montgomery and Market for the People’s Street Festival. Music, performance, art and fun for the whole family. 

Noon-1pm, Oakland:

A mass rally in Oakland, at 14th and Broadway, with food, speakers, music, activities, and generally a lot to do that you can’t if you’re at work. 

1-3pm, Oakland:

According to Occupy Oakland “After the rally, those in attendance have the opportunity to stay downtown or join one of the autonomous actions that will be departing from 14th & Broadway to continue shutting down various capitalist institutions in the downtown area.”

3pm, Oakland:

Meet at Fruitvale Plaza (next to the Fruitvale Bart station) for likely the biggest action of the day. The March for Dignity and Resistance is being called the Bay Area’s regional protest and supporters will be there from all over the area. mayday2012.blogspot.com

6pm, San Francisco:

Celebrate workers rights at a fundraiser for Young Workers United, a self-described “multi-racial and bilingual membership organization dedicated to improving the quality of jobs for young and immigrant workers.” The party is at El Rio, 3158 Mission. www.occupysf.org

On May Day, local groups who have taken to occupying spaces in ways other than public square-camping will be ramping up their efforts. The occupied farm at Gill Tract will push on, and in a message from Occupy San Francisco: “On May Day, the SF Commune will open it’s doors and conduct another Open Occupation in solidarity with the May 1st General Strike.” So if you’re looking for someone to sleep while protesting a complex web of oppressive forces Tuesday night, you may be in luck.

For more information, see www.strikemay1st.com, a clearinghouse for Bay Area May Day plans.

Also see:

www.occupythebridge.com

www.occupysf.org

mayday2012.blogspot.com

www.decolonizeoakland.org

www.occupyoakland.org

The two defining votes of 2012

38

The Board of Supervisors will be facing two votes in the next couple of months that will define this board, establish the extent of the mayor’s political clout — and potentially play a decisive role in the political futures of several board members.

Oh: They’ll also have a lasting impact on the future of this city.

I’m talking about 8 Washington and CPMC — one of them the most important vote on housing policy to come along in years, the other a profound decision that will change the face of the city and alter the health-care infrastructure for decades to come.

Both projects have cleared the Planning Commission, as expected. Neither can go forward without approval from a majority of the supervisors. And there will be intense downtown lobbying on both of them.

The 8 Washington project would create what developer Simon Snellgrove calls the most expensive condos ever built in San Francisco. A piece of waterfront property would become a gated community for the very, very rich, many of whom won’t even live here most of the time. If it’s approved, the economy won’t collapse, neighborhoods won’t be destroyed — but it will make a powerful statement about the city’s housing policy. The message: We build housing for the 1 percent. We are a city that caters only to one very tiny group of people. We are willing to let the needs of the few drive our policy over the needs of the many.

Face it: There is no shortage of housing for the people who will buy Snellgrove’s condos. There’s a severe shortage of housing for most of the people who actually work in San Francisco. And the city’s housing policy is so scewed up that it’s making things worse. That’s the message of 8 Washington.

Then there’s CPMC. California Pacific Medical Center wants to put a snazzy state-of-the art new medical center on Van Ness, which is all well and good. But the giant nonprofit Sutter Health, which operates CPMC, has been openly hostile to some of the city’s demands (for housing, transit and other environmental mitigiation) and the proposal that Mayor Ed Lee has signed off on is way out of balance. There’s not anything even close to a reasonable link between jobs and housing — which will impact the entire city. You bring in a lot of new workers and don’t help build enough housing for them and everyone’s rent goes up.

CPMC also wants to radically downsize St. Luke’s Hospital, the only full-service facility on the south side of town except for the overcrowded and overloaded SF General. Health care for a sizable part of the city will suffer.

This is a very big deal, and the Chamber of Commerce is pushing hard for the supes to approve it. A lot of labor and the entire affordable housing community is against it.

So put those two votes in front of a board where the progressive majority has been very shaky of late — and where Lee will be working hard to line up six votes — and you’ve got potential political dynamite. Supervisor John Avalos told me he has serious concerns about both projects. Sup. David Campos told me he feels the same way. Sup Eric Mar is unlikely to vote for 8 Washington and unlikely to oppose the health-care workers and the progressive leaders who want to block the CPMC deal and make Sutter come back with a better offer, but some elements of labor are pushing hard for 8 Washington and Mar is up for re-election in one of the city’s swing districts.

Sup. David Chiu is against 8 Washington. I’ve called Sups. Jane Kim and Christina Olague (who was not a fan of the project when she was on the Planning Commission) but they haven’t gotten back to me. Olague is running for re-election this fall in the city’s most progressive district, one that’s right on the edge of the CPMC project site; Kim’s district is on the other edge.

You can’t really count to six on either of these projects without getting Chiu and/or Kim and/or Olague. Chiu has no progressive opposition, but if he supports the CPMC deal, someone may decide to challenge him. If Olague supports either project, it will give her opponents plenty of fodder for the fall campaign (John Rizzo, who is running against her, told me he opposes both). If Olague opposes the two projects, it’s going to be much harder for anyone to run against her from the left since she will have demonstrated that she can stand up the mayor on tough issues.

I’ll let you know if I hear more.

 

 

 

Reject the CPMC deal

0

EDITORIAL For most of the past year, Mayor Ed Lee had been taking a tough line with California Pacific Medical Center, the health-care giant that wants to build a state-of-the-art 555-bed hospital on Cathedral Hill. The mayor had been telling a stunningly recalcitrant CMPC management that the outfit would have to put upwards of $70 million into affordable housing and spent millions more on transit, neighborhood and charity-care programs to mitigate the impacts of the massive project.

But late in March, something happened. Under immense pressure from the Chamber of Commerce and other big business groups, the mayor buckled and agreed to a deal with woefully inadequate mitigation measures. The supervisors should reject the plan and force CPMC to do better.

The biggest problem with a project this size is the mix of jobs and housing. Lee is properly concerned about creating jobs in a city where unemployment in some neighborhoods is stubbornly high. But the proposed deal only guarantees a tiny fraction of the 1,500 permanent new jobs for San Francisco residents.

That means a city that has almost zero vacancy in affordable housing is going to have to absorb a workforce much of which won’t be able to buy or rent anything at current market rates. That means more competition for scarcer housing and higher rents and home costs for everyone.

By any basic planning logic, CPMC should be on the hook for providing enough affordable housing for at least some reasonable percentage of its workforce. Instead, the hospital chain is offering about $33 million, only $3 million of which will be paid up front. That won’t even address half of the housing impact. Besides, the jobs will be there when construction starts, and more when the hospital opens; the limited affordable housing money will come much later. The highest-paid doctors and administrators may be able to afford the pricey new market-rate condos the city is madly approving — but where, exactly, are the nurses, orderlies, clerks, janitors and other health-care workers going to live?

CPMC has agreed to provide charity care at the same level is currently does — which is abysmally low, among the lowest of all nonprofit hospital chains in California. So that’s not an advantage.

And it has promised to keep open St. Luke’s Hospital in the Mission — the only full-service hospital other than SF General in the southeast part of town. But the proposal calls for cutting the number of beds by nearly two-thirds, from 229 to 80. And it allows for the closure of that hospital if CPMC’s system-wide operating margin falls below 1 percent (something that will be hard for the city to challenge, since CPMC handles the books).

It’s cynical how CPMC is using this critical medical facility in an underserved area as a bargaining chip. Already, hospital lobbyists are warning that St. Luke’s will be shut down if they don’t get what they want on Cathedral Hill.

Meanwhile, CPMC has labor trouble and is refusing to guarantee that existing employees at facilities that will be demolished will be able to keep their jobs and seniority at the new hospital.

We realize that CPMC needs to build a new facility to replace aging and seismically unsafe structures elsewhere in town. But the hospital chain also has a responsibility to address the impacts this project will have on San Francisco. And right now, it’s not a good deal.

End the health-care scam

15

OPINION Last year, after receiving data from San Francisco, the Wall Street Journal reported on an investigation into the use of health reimbursement accounts by several local restaurants. It showed a group of employers evading the city’s health care law while charging their customers a “Healthy San Francisco” surcharge that is never actually spent on employees’ health care.

Rather than providing health coverage to their workers, as customers are led to believe, the restaurants are allocating funds for HRAs — and taking back the funds before they can be used.

The numbers speak for themselves: Of the $62 million that was set aside for health care accounts in 2010, more than $50 million was kept by employers.

>>WHO’S GAMING THE SYSTEM? CLICK HERE FOR OUR COMPLETE GUIDE TO RESTAURANTS WITH SURCHARGES — AND WHERE THE MONEY GOES

Workers spoke about never being notified about the accounts; being forced to jump through numerous, often onerous hoops to receive reimbursements or never receiving reimbursements; facing severe restrictions on use of the funds; and fearing retaliation for seeking to access the funds. It was clear that as long as employers can take back unspent funds they have a large incentive to restrict workers’ access.

In response, Supervisor Campos drafted an amendment to the Health Care Security Ordinance (known as Healthy San Francisco) that would have closed this loophole, which was being exploited by a small number of employers. The Chamber of Commerce, accompanied by the San Francisco Chronicle, made hysterical claims about impending job loss and business closures, and after the Board of Supervisors approved the legislation on a 6-5 vote, Mayor Ed Lee vetoed it.

Supervisors Malia Cohen and David Chiu then authored “compromise” legislation that actually didn’t address the problem. Their version merely allowed employers to take back workers’ health care dollars after two years instead of one. This cosmetic change did, however, provide enough window dressing to please the Chamber, so the supervisors approved it and Mayor Lee signed it into law.

Now, just a few months later, an article in the Public Press showed exactly why we opposed the Cohen/Chiu amendment in the first place: It doesn’t really close the loophole. Employers can still take money back from the HRAs. This creates a clear incentive to choose HRAs over insurance — the worst option for workers. Furthermore, the loophole leaves responsible businesses that provide health coverage to employees through insurance or HSF competing against employers that exploit it by paying less into HRAs.

We find it unconscionable that there are businesses charging customers a health-care surcharge and then keeping the money for profit. What is more unconscionable is that City Hall passed an amendment that continues to let it happen.

The Department of Labor Standards Enforcement compliance data for 2011 will be available next month — and if that continues to show abuse of the HRA provision, then it’s time for the Board of Supervisors to end the charade and truly close the loophole once and for all. Healthy San Francisco is about providing health care for workers — not creating additional profit for businesses.

Assemblymember Tom Ammiano represents the 13th District. Supervisor David Campos represents District 9.

Editorial: Reject the CPMC deal!

17

EDITORIAL For most of the past year, Mayor Ed Lee had been taking a tough line with California Pacific Medical Center, the health-care giant that wants to build a state-of-the-art 555-bed hospital on Cathedral Hill. The mayor had been telling a stunningly recalcitrant CMPC management that the outfit would have to put upwards of $70 million into affordable housing and spent millions more on transit, neighborhood and charity-care programs to mitigate the impacts of the massive project.

But late in March, something happened. Under immense pressure from the Chamber of Commerce and other big business groups, the mayor buckled and agreed to a deal with woefully inadequate mitigation measures. The supervisors should reject the plan and force CPMC to do better.

The biggest problem with a project this size is the mix of jobs and housing. Lee is properly concerned about creating jobs in a city where unemployment in some neighborhoods is stubbornly high. But the proposed deal only guarantees a tiny fraction of the 1,500 permanent new jobs for San Francisco residents.

That means a city that has almost zero vacancy in affordable housing is going to have to absorb a workforce much of which won’t be able to buy or rent anything at current market rates. That means more competition for scarcer housing and higher rents and home costs for everyone.

By any basic planning logic, CPMC should be on the hook for providing enough affordable housing for at least some reasonable percentage of its workforce. Instead, the hospital chain is offering about $33 million, only $3 million of which will be paid up front. That won’t even address half of the housing impact. Besides, the jobs will be there when construction starts, and more when the hospital opens; the limited affordable housing money will come much later. The highest-paid doctors and administrators may be able to afford the pricey new market-rate condos the city is madly approving — but where, exactly, are the nurses, orderlies, clerks, janitors and other health-care workers going to live?

CPMC has agreed to provide charity care at the same level is currently does — which is abysmally low, among the lowest of all nonprofit hospital chains in California. So that’s not an advantage.

And it has promised to keep open St. Luke’s Hospital in the Mission — the only full-service hospital other than SF General in the southeast part of town. But the proposal calls for cutting the number of beds by nearly two-thirds, from 229 to 80. And it allows for the closure of that hospital if CPMC’s system-wide operating margin falls below 1 percent (something that will be hard for the city to challenge, since CPMC handles the books).

It’s cynical how CPMC is using this critical medical facility in an underserved area as a bargaining chip. Already, hospital lobbyists are warning that St. Luke’s will be shut down if they don’t get what they want on Cathedral Hill.

Meanwhile, CPMC has labor trouble and is refusing to guarantee that existing employees at facilities that will be demolished will be able to keep their jobs and seniority at the new hospital.

We realize that CPMC needs to build a new facility to replace aging and seismically unsafe structures elsewhere in town. But the hospital chain also has a responsibility to address the impacts this project will have on San Francisco. And right now, it’s not a good deal.