Ron Conway

Guns, gods, and government

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EDITORIAL Humans tend to believe that we’re smarter than we really are. It’s a problem that can be exacerbated by concentrations of wealth and technological expertise, which can cause some people to believe they have an almost God-like power to manifest solutions to any challenge they confront, particularly when they have lots of money to throw at the problem.

But that’s really just hubris. It’s the story of Icarus striving for the sun and falling back to Earth when his technology failed him. Knowing our limits and feeling a sense of humility and social responsibility are the first steps toward dealing honestly with problems we face. And last week, we were reminded again of this reality by venture capitalist Ron Conway, the libertarian-leaning power broker who has taken a paternalistic hold on the city (see “The Plutocrat,” 11/27/12).

Being a newspaper that has always believed in gun control, we share Conway’s newfound desire to reduce gun violence, a cause he suddenly adopted after the massacre at Sandy Hook Elementary school in December 2012. Conway and his Smart Tech Foundation last week unveiled some early designs for high-tech guns that only work in the hands of their owners, and which will notify those owners when someone has moved them.

“Let’s use innovation to bring about gun safety. Let’s not rely on Washington,” Conway told the San Francisco Examiner, which put the story on its Jan. 29 cover.

There are many levels of ridiculousness to Conway’s belief that his gizmos can do more to reduce gun violence than even modest federal regulation of the more than 300 million guns in this country. After all, guns are designed to inflict violence, and just 3 percent of gun deaths are accidental shootings (62 percent are suicides and 35 percent are homicides). Sandy Hook shooter Adam Lanza used guns from his home that he’d been taught to use by his mother, who ended up being his first victim, so it seems unlikely Conway’s guns would have changed that outcome.

When reporter Jonah Owen Lamb asked Conway how his technology differed from widely available trigger locks, he compared them to the iPhone, which invented a new market for its product. So the answer to gun violence is creating a new market for a new generation of guns that only their wealthy owners can fire?

While we’re not huge fans of the Second Amendment — the one that conservatives like Conway consider sacrosanct — we do understand that it was written to give the masses tools to resist wealthy and powerful oppressors. That includes people like Conway, fellow venture capitalist Thomas Perkins (whose comparison of progressive activists to Nazis has been lighting the Internet), and the Establishment politicians whom they sponsor.

Guys, society doesn’t need your gizmos, libertarian ideals, or hubris to address the most vexing challenges we face, from gun violence to global warming to creating a modern transportation infrastructure. We just need some of the obscene wealth you’ve been hoarding.

 

Residents vs. tourists

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steve@sfbg.com

Evictions and displacement have become San Francisco’s top political issues, amplified by protests against tech companies that are helping gentrify the city. Yet Airbnb, which facilitates the conversion of hundreds of San Francisco apartments into de facto hotel rooms, has so far avoided that populist wrath.

Tenants use the online, short-term rentals to help make rent in this increasingly expensive city, a point that the company often emphasizes.

“For thousands of families, Airbnb makes San Francisco more affordable,” Airbnb spokesperson Nick Papas wrote to the Guardian by email, citing a company survey finding that “56 percent of hosts use their Airbnb income to help pay their mortgage or rent.”

But it’s also true that Airbnb allows hundreds of rent-controlled apartments to be removed from the permanent housing market — in violation of local tenant, zoning, tax, and other laws — something that has united tenant, landlord, hotel, and labor groups against it (see “Into thin air,” 8/6/13).

“The problem is Airbnb is so easy and attractive that you can take a unit out from under rent control forever,” San Francisco tenant attorney Joseph Tobener told the Guardian.

“We’re getting 15 calls a week on Airbnb,” he said, describing four categories of complaints: landlords evicting tenants to increase rents through Airbnb, tenants complaining about neighbors using Airbnb, tenants being evicted for getting caught illegally subletting through Airbnb, and Airbnb hosts who can’t get guests to leave (city law gives even short-term residents full tenant rights, except in hotels).

There isn’t good public data on how many units are being taken off the market, but Airbnb generally lists well over 1,000 housing units in San Francisco at any given time, with its smaller competitors (such as Roomorama and VRBO) adding hundreds more.

The San Francisco Rent Board listed 326 no-fault evictions (Ellis Act, owner move-in, capital improvement) in its 2012-13 annual report. That number is almost certain to rise in the 2013-14 report due out in March, and it is compounded by an unknown number of buyouts that pressure tenants to voluntarily leave, all of it creating a displacement crisis that has galvanized the city.

“Isn’t it far more likely that more units are being lost [from the rental market] through Airbnb?” San Francisco Magazine recently quoted a UC Berkeley professor as saying in an article questioning whether Ellis Act evictions are really a “crisis.”

So Airbnb is clearly having a big impact on the city’s affordable housing crisis. Yet Airbnb is largely flying under the political radar in its hometown and ducking questions about its impacts.

“Airbnb has all the statistics we need to assess its impacts on the city’s housing market,” Tobener said. The company refuses to disclose such data. Airbnb’s customers need to consider their impacts to the city’s affordable housing crisis, Tobener added, because “there are social consequences to the decisions we make.”

 

STALLED IN LIMBO

Last year I discovered Airbnb was flouting a ruling that it should be paying the city’s 15 percent transient occupancy tax (“Airbnb isn’t sharing,” 3/19/13), a nearly $2 million per year tax dodge.

Yet Airbnb, which has quickly grown from a small start-up into a company worth nearly $3 billion, has some powerful friends in Mayor Ed Lee and venture capitalist Ron Conway, who invests in both Airbnb and Mayor Lee’s political campaigns and committees.

So the company has stonewalled Guardian inquiries for the last year as it has worked with Board of Supervisors President David Chiu on legislation that tries to bring the company’s business model into compliance with local laws. That hasn’t been easy, as Chiu told us.

“It has been difficult to corral the different stakeholders to get on the same page,” Chiu said. “Airbnb has been like unraveling an onion. The more progress we make, the more issues come up.”

Janan New, executive director of the San Francisco Apartment Association, says it shouldn’t be so hard. “They need to enforce the law. They need to collect the hotel tax. They don’t need new laws,” she told us.

While the city is unlikely to simply follow New’s advice, the displacement issue adds another layer to Airbnb’s onion, one that sources say has become an issue of growing concern within the company, which has finally begun to respond to Guardian inquiries.

Those concerns have also been compounded as Airbnb is now being sued by one of Tobener’s clients, Chris Butler, who says he was evicted from his rent-controlled Russian Hill apartment so the landlord could make more money through Airbnb (see “Airbnb profits prompted SF eviction, ex-tenant says,” SF Chronicle, 1/22/14).

“We strongly support rules that keep people in their homes, and the vast majority of Airbnb hosts are regular people just trying to make ends meet,” Airbnb told the Guardian. “Whatever happened in this case, we certainly do not support unscrupulous landlords who evict long term tenants solely to turn their apartments into short-term rentals, but it is important to note that experts have found such cases to be extremely rare.”

Airbnb didn’t respond to our follow-up questions, but those “expert” findings appear to be a reference to a study the company commissioned late last year from Berkeley-based Rosen Consulting Group entitled “Short-Term Rentals and Impact on Apartment Market.”

But that study of Airbnb’s impact to rental housing in San Francisco doesn’t really draw the conclusions that company seems to think and hope it does.

 

MISLEADING NUMBERS

One number that the study and Airbnb have repeatedly sought to highlight is the claim that “90 percent of Airbnb hosts in San Francisco use Airbnb to occasionally rent out only the home in which they live,” as the company put it to us.

“Airbnb users generally do not identify themselves as utilizing short-term rentals as a business. In fact, 90 percent of Airbnb hosts [in San Francisco] indicated that they live in the home listed on Airbnb,” was how the study put it.

“It’s trash. They pick and choose the data they want to share,” Tobener said of the study and the 90 percent figure, which he says was derived from a 2011 user survey before the local housing market exploded. Rosner Consulting told us it stands by the study but won’t discuss it.

The figure also lumped in those with multiple rooms in their homes that have traditionally been rented by local residents and covered by rent-control laws. It also discloses that 10 percent of Airbnb hosts are renting out outside units simply as a business, a figure that has likely risen over the last three years.

The study does disclose that there were 1,576 properties booked through the company in August 2012, which the study notes was just 0.4 percent of the 378,000 homes in San Francisco, which Airbnb uses to dismiss its impacts on the market.

But the study includes only macroeconomic data, rather than looking at the company’s impact on certain socioeconomic groups — such as those making 120 percent or less of median area income, the people being evicted from and priced out of the city — or the supply of rent-controlled housing.

“The average gross income per Airbnb property in the previous 12 months was $6,722, or an average of $564 per month,” the study discloses, choosing to use average rather than median figures even though they’re considered less accurate gauges of income and housing data.

Customers who only use Airbnb once or twice will skew those averages way down. Yet the study then compares that number to the “average market-rate apartment rent in San Francisco, which was $2,498 per month in mid-2013. The average income generated is insufficient to cover monthly rental expenses in full.”

Which tells us nothing about how Airbnb is impacting either rent-controlled housing or the median income San Franciscans who rely on it. According to the US Census Bureau, the median rent in San Francisco was $1,463 in 2012 and 64 percent of San Franciscans rent their homes.

“The study is bullshit,” Tobener said. “They could pull data and tell us how many people are renting full units on Airbnb, but they don’t.”

Yet the company claims that it is concerned about these issues and working with the city.

“We believe our community of hosts should pay applicable taxes and we are eager to discuss how this might be made possible. We’ve reached out to officials in San Francisco and we continue to have productive discussions with city leaders,” Airbnb told the Guardian. “These issues aren’t always easy, but if we work together, we can craft fair, responsible, clear rules that ensure San Francisco continues to benefit from home-sharing.”

Yet neither Airbnb nor its political supporters seem to want to have this public discussion. The company has stopped responding to our inquiries, again, and when we asked the Mayor’s Office about Airbnb’s impacts to the affordable housing market, we got this response and a refusal to directly answer either the original or follow-up questions: “The Mayor has prioritized preserving, stabilizing and growing the City’s housing stock. His policy priorities include protecting residents from eviction and displacement, including Ellis Act reform and stabilizing and protecting at-risk rent-controlled units, through rehabilitation loans and a new program to permanently stabilize rent conditions in at-risk units.”

Yet Airbnb continues to have an impact on those “at-risk rent-controlled units” that few people seem to want to discuss.

Presidio Trust decides on museum proposals

The Presidio museum showdown has come to an end for now, and the winner of the hotly contested mid-Crissy Field site is (drum roll, please) … no one.

Not the Golden Gate National National Park Conservancy. Not the Bridge Institute. And no, not Star Wars creator George Lucas.

At an impromptu press conference this afternoon, Presidio Trust Chair Nancy Hellman Bechtle said the board unanimously voted to not move forward with any of the museum proposals.

“This is the most spectacular site in the country,” Bechtle told reporters. “We simply do not believe any of the projects were right for this location.”

Since November of 2012, The Bridge Institute, the Golden Gate National Parks Conservancy’s Presidio Exchange, and filmmaker and Star Wars creator George Lucas’ personal pop art collection have all competed for a patch of uber-desirable real estate a stone’s throw from the Golden Gate Bridge.

The site is currently occupied by Sports Basement, whose planned move will be unaffected by the decision to reject the museum proposals, a spokesperson for the Presidio told the Guardian.

In January the three teams were made to re-submit their three proposals to the Presidio Trust, which cited Goldilocks reasons for not liking the various proposals. The Lucas Cultural Arts Museum was too big, the Presidio Exchange was too programmatically vague, and the Bridge Institute didn’t have enough of the green stuff (money).

But unlike Goldilocks, in the end the Presidio Trust did not find any porridge that was just right. However, it did offer to assist with finding alternative sites in the Presidio for the museums to find homes.

“There are a number of sites in the Presidio that are possible places to build,” said Presidio Trust Executive Director Craig Middleton. “We are really early in these conversations.”

The Lucas Cultural Arts Museum’s spokesperson, David Perry, said there are many cities vying for Lucas’ pop and cultural art museum.

“We’ve been getting requests to look at other sites for this museum, we’re going to look at those sites,” Perry said. We asked if he was referring to Chicago, where Lucas has expressed interest in building the museum before.

“I’ve heard all kinds of cities,” Perry said.

When we asked Perry how Lucas felt when he heard the news, he answered a bit oddly, if candidly.

“I spoke with George this morning,” he said.  “And as my grandmother used to say, if ‘ifs’ and ‘buts’ were candies and nuts, we’d all have a Merry Christmas.”

Above: Hit “play” to hear Lucas Cultural Arts Museum spokesperson David Perry tell us how his grandmother would have reacted to the Presidio Trust’s decision. 

Okay then.

Notably, the Lucas proposal was endorsed by Mayor Ed Lee, tech venture captalist Ron Conway, and a host of other well-heeled and monied backers. In a letter to the Trust, Congresswoman Nancy Pelosi publicly urged its members to hurry up on a decision, and to choose something that would bring in “a vibrant cross section of visitors to the Presidio, with particular attention to inner-city youth.”

We asked Becthle what influence, if any, opinions from powerful politicians had on the Trust’s ultimate decision.

“They’re very interested in California and the city,” she responded. “Sure I listen to [Sen. Dianne Feinstein], and to Nancy, but I think it was most important to do what was right with the park, and not to please one side or the other.”

Local journalists starting to catch onto Airbnb’s subversion of SF’s rental market

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Airbnb and other so-called “shared housing” sites allow hundreds of rent-controlled apartments in San Francisco to be essentially removed from the housing market, part of a concern that has caught populist fire recently with protesters and politicians pledging to do something about evictions and displacement.

Yet I’ve been one of the few local journalists to hound Airbnb over its illegal business model and refusal to pay nearly $2 million per year in transient occupancy taxes that it owes the city. But that may be beginning to change, as pair of mainstream local publications in the last week have cautiously waded into what outside journalists from Time magazine (which specifically mentioned my reporting on the issue) to German public television have already seen as a big and important issue.

The San Francisco Chronicle today has a story about a lawsuit from a tenant subjected to an owner-move-in eviction, with said owners then turning around to rent units in the building out through Airbnb. And San Francisco Magazine also mentioned Airbnb in its controversial article criticizing concerns over evictions.

“Isn’t it far more likely that more units are being lost [from the rental market] through Airbnb?” the magazine quoted a UC Berkeley professor as saying, comparing Airbnb to Ellis Act evictions. Hey, SF Mag, don’t you think that’s a good question that might be worth exploring?

Janan New, executive director of the San Francisco Apartment Association, told me this week that she found 1,100 rent-controlled San Francisco apartments listed on Airbnb — almost all of it in violation of local tenant and zoning laws — a fact that she personally conveyed to Mayor Ed Lee, who supports Airbnb, shares a funding source with the company (venture capitalist Ron Conway), and has been dismissive of the issue.

“They need to enforce the law like they do in New York City,” New told us, referring to a city that has cracked down on Airbnb’s subversion of its rent control laws. She’s lobbied City Hall, documented the problem, and threatened to sue the city: “I’ve done everything I can possibly think of.”

Meanwhile, Board of Supervisors President David Chiu has been negotiating with Airbnb for almost a year on legislation that would attempt to legalize and regulate its activities here in San Francisco, telling us “it has been difficult to corral the different stakeholders to get on the same page” and no longer offering any predictions when it might be complete.

I was already working on a story about Airbnb (which still won’t respond to my inquiries) for our next issue [UPDATE: It looks like I’ll hold that story for our Feb. 5 issue], so I’ll have more to say about this then. And in the meantime, here’s my latest message to the Mayor’s Office of Communications trying to get some kind of response to this issue, which it has ignored for the last 24 hours:

“I’m about to write about the rampant illegal behavior by Airbnb customers again, which seems increasingly relevant to the “affordability agenda” that Mayor Lee is touting, so I wanted to check in to see whether the mayor is still offering his unqualified support to this company, despite its violations of local housing, zoning, and planning laws and refusal to collect and pay the transient occupancy tax.

“Janan New with the SF Apartment Association says she’s raised this directly with Mayor Lee, including informing him recently that more than 1,100 rent-controlled apartments in San Francisco are listed on Airbnb, all in violation of local law, and she’s frustrated that he’s unwilling to enforce the law, as New York City has been doing. Meanwhile, the Airbnb legislation that David Chiu has been working on for the last year is hopelessly stalled, at least partly because Airbnb has the mayor’s support and is unwilling to compromise while it’s making some much profits off of its illegal behavior in San Francisco.   

“A recent San Francisco Magazine article (http://www.modernluxury.com/san-francisco/story/the-eviction-crisis-wasnt) even quotes a UC Berkeley professor saying that Airbnb is likely taking more rent-controlled units off the market than the Ellis Act. Considering the mayor is pursuing Ellis Act reform, why does he continue to ignore the impact that Airbnb is having on the city?”

 

 

 

 

 

 

 

 

New, final Presidio museum proposals are in

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The final round of project proposals for the Crissy Field Presidio site are in, and boy do they sure look… almost exactly the same as the last round. 

The Presidio Trust was fairly critical of each of the three finalists for the current site of the Sports Basement, which will soon lose its prime real estate. The Bridge Institute, the Golden Gate National Parks Conservancy’s Presidio Exchange, and Star Wars creator George Lucas’ personal pop art collection are all duking it out for a little patch of green (which is worth a lot of green) by the Golden Gate Bridge. 

Everyone in San Francisco has an opinion on who should win the spot: Mayor Ed Lee and tech venture capitalist Ron Conway want George Lucas’ museum to win (as do most tech folks with money), every environmental group out there wants the Presidio Exchange to get the space (including the Sierra Club), and the Chronicle’s design writer John King just wants Lucas to use the old Palace of Fine Arts site, dammit.

The Presidio Trust, a presidentially appointed entity, has the final say. And what it said last time was this: give us new proposals.

The Lucas proposal was too big, and the Trust felt it needed to be “redesigned to be more compatible with the Presidio.” The Presidio Exchange, it said, struggled to find a theme programatically. It lacked focus. As for the Bridge Institute? The Trust was worried it didn’t have the money to build with at all. 

Now everyone is back with new plans, in force.

George Lucas responded to the critique that his museum was just too darn big:
“Relative to the issue of ‘ensuring the building’s compatibility with the Presidio’ we are submitting two new design concepts for your consideration that we believe address the issues of massing and height. We have worked diligently the past few weeks with our architects at Urban Design Group and other members of our team to develop a new design that we believe will meet the criteria outlined by the Trust while providing the best home for the collection and its diverse cultural and educational programs. We are submitting two designs for your consideration, with the intent that if the Lucas Cultural Arts Museum is chosen for the Crissy Field site, you will identify the design you would like to see further developed.”

So it’s the same beast, just you know, smaller.

The Presidio Exchange folks, on the other hand, decided that since their programs lacked clarity, they’d make a flow chart. It’s good to know that they strive for consistency.

pdxgraph

pdxfinal

The final conceptual image of the PDX.

And as for funding the Bridge Institute? It wants to put a member of the Presidio Trust to work helping it raise money.

“The trust and Trust Board would make its network of contacts available to the BRIDGE fundraising team, and assist in making positive contacts with those contacts as part of the fundraising efforts of the organization,” it wrote. In other words, Presidio Trust, help us raise the dough, please. Presidio Trust President Nancy Hellman Bechtle is wealthy, but there’s no telling if she’d tap her wealthy friends to help the Bridge Institute. 

“We appreciate the effort each team has made to further develop its proposal for the Mid-Crissy Field site,” Becthle said, in a press release. “In the weeks ahead we will evaluate the revised proposals, weigh the wide range of public comments, and make a decision that will stand the test of time. This is a remarkable opportunity for the Presidio and San Francisco and we look forward to the public’s continued engagement.”

Love the designs or hate them, the public’s last chance to comment will be at the Public Board  of Directors Meeting to be held on Monday, Jan. 27, 6:30 pm in Herbst at the Presidio.

You can read all the museum proposals for yourself, here.

And while you’re at it, check out our front page story covering the founding of the Presidio, and how that history shaped the museum proposals.

 

State of the City speech filled with unsupported promises

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It was maddening to watch Mayor Ed Lee deliver his annual State of the City address this morning. This was pure politics, from the staged backdrop of housing construction at Hunters Point Shipyard to the use of “regular people” props to the slate of vague and contradictory promises he made.

“This place, the shipyard, links our proud past to an even more promising future,” was how Lee began his hour-plus, invite-only address.

Later, he touted the housing construction being done there by Lennar Urban as emblematic of both his promise to bring 30,000 new housing units online by 2020 — the cornerstone to what he called his “affordability agenda” — and the opposition to unfettered development that he is pledging to overcome.

“A great example is the place we’re standing right now. This took us too long,” Lee said after decrying the “easy slogans and scapegoating” by progressive activists who place demands on developers.

But that implication was complete bullshit. As we and others have reported, progressive and community activists have long encouraged Lennar Urban (which has a close relationship to Lee) to speed up development on this public land that it was given almost a decade ago, particularly the long-promised affordable housing, rather than waiting for the real estate market to heat up.

That was just one of many examples of misleading and unsupported claims in a speech that might have sounded good to the uninformed listener, but which greatly misrepresented the current realities and challenges in San Francisco.

For example, Lee called for greater investments in the public transit system while acknowledging that his proposal to ask voters this November to increase the vehicle license fee isn’t polling well. And yet even before that vote takes place, Lee wants to extend free Muni for youth and repeal the policy of charging for parking meters on Sundays without explaining how he’ll pay for that $10 million per year proposal.

“Nobody likes it, not parents, not our neighborhood businesses, not me,” Lee said of Sunday meters, ignoring a study last month by the San Francisco Muncipal Transportation Agency showing the program was working well and accomplishing its goals of increasing parking turnover near businesses and bringing in needed revenue.

Lee also glossed over the fact that he hasn’t provided funding for the SFMTA’s severely underfunded bicycle or pedestrian safety programs, yet he still said, “I support the goals of Vision Zero to eliminate traffic deaths in our city.”

Again, nice sentiment, but one that is totally disconnected from how he’s choosing to spend taxpayer money and use city resources. And if Lee can somehow achieve his huge new housing development push, Muni and other critical infrastructure will only be pushed to the breaking point faster.  

Lee acknowledges that many people are being left out of this city’s economic recovery and are being displaced. “Jobs and confidence are back, but our economic recovery has still left thousands behind,” he said, pledging that, “We must confront these challenges directly in the San Francisco way.”

And that “way” appears to be by making wishful statements without substantial support and then letting developers and venture capitalists — such as Ron Conway, the tech and mayoral funder seated in the second row — continue calling the shots.

Even with his call to increase the city’s minimum wage — something that “will lift thousands of people out of poverty” — he shied away from his previous suggestion that $15 per hour would be appropriate and said that he needed to consult with the business community first.

“We’ll seek consensus around a significant minimum wage increase,” he said, comparing it to the 2012 ballot measures that reformed the business tax and created an Affordable Housing Fund (the tradeoff for which was to actually reduce the on-site affordable housing requirements for developers).

But Mayor Lee wants you to focus on his words more than his actions, including his identication with renters who “worry that speculators looking to make a buck in a hot market will force them out.”

Yet there’s little in his agenda to protect those vulnerable renters, except for his vague promise to try to do so, and to go lobby in Sacramento for reforms to the Ellis Act. While in Sacramento, he says he’ll also somehow get help for City College of San Francisco, whose takeover by the state and usurpation of local control he supported.   

“City College is on the mend and already on the path to full recovery,” Lee said, an astoundingly out-of-touch statement that belies the school’s plummeting enrollment and the efforts by City Attorney Dennis Herrera and others to push back on the revocation of its accreditation.

Lee also had the audacity to note the “bone dry winter” we’re having and how, “It reminds us that the threat of climate change is real.” Yet none of the programs he mentions for addressing that challenge — green building standards, more electric vehicle infrastructure, the GoSolar program — would be as effective at reducing greenhouse gas emmisions as the CleanPowerSF program that Lee and his appointees are blocking, while offering no other plan for building renewable energy capacity.

Far from trying to beef up local public sector resources that vulnerable city residents increasingly need, or with doing environmental protection, Lee instead seemed to pledge more of the tax cutting that he’s used to subsidize the overheating local economy.

“Affordability is also about having a city government taxpayers can afford,” Lee said. “We must be sure we’re only investing in staffing and services we can afford over the long term.”

How that squares with his pledges to put more resources into public transit, affordable housing development, addressing climate change, and other urgent needs that Lee gives lip service to addressing is anybody’s guess.  

Mayor Ed Lee’s committee gives $10,000 that it doesn’t have to the 8 Washington project UPDATED

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Mayor Ed Lee presents himself as a model of fiscal responsibility, but the Mayor Ed Lee for San Francisco Committee that he controls has recently been spending big money that it doesn’t have, including more than $10,000 that it has recently given to the Yes on Propositions B&C campaign, according to campaign finance filings.

The Mayor Ed Lee for San Francisco Committee, a general purpose committee that Lee and its Treasurer Kevin Heneghan are jointly responsible for, made late contributions of $8,666.66 on Oct. 29 and $1,667 on Oct. 30 to San Franciscans for Parks, Jobs and Housing, Yes on Props. B&C, which supports the 8 Washington project. Lee’s committee also made a $4,333.34 contribution to the Yes on A campaign on Oct. 29.

The Lee committee’s contributions are actually small potatoes for the Yes on B&C campaign, which is spending more than $2 million to have voters green-light the project, most of it coming from the developer, Pacific Waterfront Partners, which kicked in late contributions of $450,000 on Oct. 28 and $250,000 on Oct. 24, bringing its total to about $1.8 million.

But what’s interesting about the Lee committee’s donations is that the final pre-election statement that it filed on Oct. 24 showed that it had just $1,208 in the bank and $26,886 in outstanding debts — most of that to Oakland-based EMC Research for polling it conducted during the Sept. 22-Oct. 19 period.

Neither Heneghan nor Lee responded to our calls for comment, and Lee doesn’t have any public events scheduled between now and election day on Tuesday, so details on this intriguing bit of deficit spending and what kind of polling work the mayor’s committee was doing remain a mystery. [UPDATE 11/5: Lee’s office deferred to Heneghan, who just emailed us this response: “As you know, political committee report filings are a snapshot in time. The Mayor Ed Lee for San Francisco ballot measure committee has received additional contributions since the most recent report that will be appropriately reported. All activity through the committee in support of ballot measures endorsed by Mayor Lee will continue to be appropriately reported as well.” We asked Heneghan whether he would disclose the donors, and we’re waiting to hear back.]

The Mayor Ed Lee for San Francisco Committee hasn’t reported raising any money this year, unlike last year when it raised about $400,000 from some of the city’s biggest establishment players, including Lennar Homes ($35,000), Committee on Jobs ($30,000), San Francisco Alliance for Jobs and Sustainable Growth ($25,000 in basically a pass-through from venture capitalist Ron Conway), San Francisco Association of Realtors ($20,000), and the city’s police and firefighters’ unions ($10,000 each).

But how exactly could the Mayor Ed Lee for San Francisco Committee give $10,000 to the Yes on Props. B&C campaign if it didn’t actually have the money to cover the checks?

When we asked a source at San Francisco Ethics Commission about it, at first he was puzzled, and then he told us that while the committee is required to report late expenditures that it makes before the election, it isn’t required to report late contributions that it receives. That we won’t find out until its Form 460s are due Jan. 31, 2014.

So who really paid for Lee’s contributions to the Yes on B&C campaign, as well as more than $20,000 in polling work that Lee’s committee paid for? And what will our mayor do in return for the people who are digging his committee out of its debts?  

 

Challenge Mayor Lee and his lies

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EDITORIAL In the long history of San Francisco political corruption caused by Pacific Gas & Electric’s willingness to do and spend whatever it takes to hold onto the energy monopoly that it illegally obtained generations ago, in violation of the federal Raker Act, there have been countless ugly and shameful episodes, many of them chronicled in the pages of the Bay Guardian.

Mayor Ed Lee’s misleading Sept. 10 testimony to the Board of Supervisors, where he deliberately distorted CleanPowerSF and defended the dubious actions of his appointees to kill the program, ranks right up there with some of the worst episodes (see “Power struggle,” page 12). If there were any doubts about Lee’s lack of political integrity and independence, about his unwillingness stand up to his corporate benefactors on the behalf of the people he was elected to serve, this appalling performance should settle them.

It was bad enough when PG&E used money from San Francisco ratepayers to bury public power advocates under an avalanche of lies, fear-mongering, and the testimony of paid political allies every election when its monopoly was being challenged, making it virtually impossible to have an honest conversation about the city’s energy and environmental needs.

But now that advocates for consumer choice and renewable energy have spent more than a decade developing a program that doesn’t require a popular vote, is competitive with PG&E’s rates, would create city-owned green energy projects serving residents for generations to come, and which was approved by a veto-proof majority on the Board of Supervisors, Mayor Lee has stooped to new lows in a desperate and transparent ploy to stop it.

Once again, as he did during his rash decision to remove Sheriff Ross Mirkarimi from office before even investigating his most serious official misconduct allegations, Mayor Lee has blithely created what Sen. Mark Leno calls a “Charter crisis.” Then, it was over the question of when one elected official should remove another; now, it is whether a trio of mayoral appointees can usurp the authority of the elected Board of Supervisors, the top policymaking body under the City Charter.

Relying on tortured logic and Clinton-esque legalese backflips doesn’t justify the SFPUC commissioners refusal to do their jobs — and it would be deemed official misconduct by a less corrupt mayor. But this mayor sees his job as simply carrying water for the people who put him there, whether that be Willie Brown and his longtime client PG&E, or venture capital Ron Conway and the companies that Lee is heaping with unprecedented tax breaks (see “Corporate welfare boom,” page 14). Please, isn’t there someone out there willing to challenge this corruption and run for mayor? This city, and the future generations living in the warming world we’re creating, deserve better.

The adulation of the technoriche

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It’s hardly news at this point that billionaire tech mogul Sean Parker tore up a public campground to build the sets for his $10 million fantasy wedding in Big Sur. And it’s been widely reported that Parker paid a $2.5 million fine to the Coastal Commission, which he tried to spin as a wonderful environmental gift to improve the state park system.

But I read with interest in the Chron that both Lite Guv Gavin Newsom and Attorney General Kamala Harris were reportedly at the wedding. Both are very smart people; both have the ability to observe the world around them. So I have to wonder:

Didn’t either Newsom or Harris think it was a little bit odd to see all this new development in a protected area? Did it occur to either of them that their richy-rich-rich pal, who has a history of snubbing laws he doesn’t like, might have done the same thing here?

Could the state’s top law-enforcement official and a member of the state Lands Commission really look at artificial ponds and large new structures, which involved bulldozers to create, and not say:

Huh? Aren’t there rules against this sort of thing?

Okay, it was a wedding, and nobody wants to be the one to throw the turd in the punchbowl. The politician guests were there to celebrate with a person who is capable of helping to fund future campaigns (and since both Harris and Newsom are considered possible candidates for governor when Jerry steps down, I bet they had a great time together).

But didn’t either of them feel at least a little weird about it?

I called Newsom’s office and left a message for Dierdre Hussey, his press person. She hasn’t called back. Nick Pacilio in Harris’s office told me someone would get right back to me; hasn’t happened yet. So we don’t know what the two were thinking.
But I do know this: The level of adulation of the technoriche has reached levels we haven’t seen since the Gilded Age.

Technology columnist James Temple puts it this way:

To the outside observer, Parker’s actions look like contempt for the piddling rules that we non-billionaires can’t buy our way around. And they certainly do nothing to alter the increasingly popular local view of the tech class as selfish and aloof, conspicuously relishing their venture capital rounds and IPO winnings, as a growing portion of the Bay Area population struggles to make the skyrocketing rents.

And politicians seem to adore the most selfish and aloof (and clueless) among them.

Take Mayor Ed Lee’s comments about Airbnb. The company is clearly cheating on its taxes. The city treasurer investigated the situation and ruled unequivocally that airbnb needs to collect and remit the Transit Occupancy Tax money that should be charged on its rooms.
When Michael Krasny asked the mayor on Forum about the issue, Lee defended airbnb (which is funded by his buddy Ron Conway), saying that the company is just “making arguments” about whether it owes the tax.

But that’s just false: The arguments are over. The company argued with the tax collector and lost. And it isn’t arguing anywhere anymore — not in court, not in the political sector. It’s just …. not paying. And because it’s a tech company, and Conway is nurturing it, the mayor seems just fine with that.

It appears that big corporations are big corporations. They may claim that they won’t be evil, and they may be headed by people in their 20s who dress like hipsters, and they may make really cool products — but their operating just like the robber barons of old. And the great wealth they’ve created has, to a great extent, also created great arrogance.

Before the trolls accuse me of fomenting class warfare, let me repeat: I didn’t start this war. I didn’t rig the political and tax systems so that the middle class would be wiped out as all of the net new wealth in a generation goes to the top 1 percent. I’d much prefer we all share in the bounty, as the middle class and working class did in the post-War era.

Meanwhile: Does anyone really need a $10 million wedding in a state park?

Airbnb is still snubbing SF, even after a NY judge rules it illegal there

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Now that a judge in New York has ruled that Airbnb is illegal there, a model that violates city tenant laws and state law, that should put pressure on the San Francisco-based company to finally stop snubbing cities and find a way to exist within local regulatory frameworks and finally start paying its taxes.   

It was good to hear KQED’s Forum discuss Airbnb this morning – it was getting lonely as the only local reporter highlighting the company’s open defiance of San Francisco’s ruling that it should be paying the city’s Transient Occupancy Tax, just like hotels – and to finally question an Airbnb executive on an issue the company has been refusing to address publicly (yes, they still aren’t returning my calls).

But the answer that David Hantman, Airbnb’s global head of public policy, gave this morning was pretty astounding in its hypocritical arrogance. He acknowledged the tax ruling by San Francisco and the company’s lack of compliance, and said the company was waiting for clarification on the various issues related to the questions of the legality of some of the short-term rentals it facilitates before paying its taxes.

In other words, this company is making tens of millions of dollars annually in San Francisco alone on a business model that it developed – one that often runs afoul of local land use and tenant laws, and in violation of people’s leases – and it’s up to city officials to find a solution to this company’s problems before it will pay taxes?!?

To his credit, Board of Supervisors President David Chiu has been trying to do just that for months, slogging through a number of complex and difficult issues that arise from this business model, and he has been clear throughout that Airbnb should be paying its taxes to the city, which it isn’t.

“It’s reasonable to ask people who benefit from the economic transactions we’re talking about to pay their fair share,” Chiu reiterated on Forum, citing the cost to the city of serving the 16 million tourists who visit the city each year.

Coincidentally, there’s a German television crew from ARD (Germany’s equivilent of the BBC) in San Francisco this week doing a story on Airbnb and the shareable economy, interviewing me about my coverage of the company, as well as others, including Airbnb co-founder Nathan Blecharczyk.

The ARD reporter told me this afternoon that Blecharczyk was animated and expansive when discussing how wonderful his company is and how it’s changing the world, but he became terse and unresponsive when she raised the issue of local taxes and regulations.

As I said on camera today, Airbnb and other shareable economy companies are cool, I’ve used them myself, and they’re certainly here to stay. But I just don’t understand their unwillingness to be good corporate citizens and to pay the taxes they owe to support the city services that their customers use.

Chiu has clearly said that Airbnb should pay the TOT — which my reporting has shown would bring $1.8 million annually into city coffers — and that paying its taxes will be a part of the regulatory package he’s working on. But sources have also told me that negotiations have been hard slog, largely because of Airbnb’s unwillingness to play by the rules and because of the unqualified support the company has from Mayor Ed Lee, whose main political fundraiser, Ron Conway, is also a major investor in Airbnb.

Hopefully the New York ruling and growing media scrutiny will prompt the young executives at Airbnb to finally become good faith partners in a city that has been so good to them — a city whose leaders seem anxious to return the favor and legalize Airbnb’s operations in San Francisco.

 

The Ro Khanna party

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When Ro Khanna, a young, energetic intellectual property lawyer, ran for Congress against Tom Lantos, he was the candidate of the progressives. I liked Khanna, and appreciated his willingness to take on the almost unheard-of task of challenging a longtime incumbent in a Democratic primary. At that point, in 2004, the big issues were the war and the PATRIOT Act, and Khanna was against both. Lantos, who was always hawkish on defense issues (and a die-hard supporter of Israel, no matter what the Israeli government was doing), was clearly out of touch with his district. But Khanna never got much traction, and he lost pretty badly.

Now he’s back, in a new era of top-two primaries (which has its own problems), and in a different district. He’s taking on Mike Honda, who, like Lantos, has been around a while, and hasn’t faced serious opposition in years.

And this time around, it’s not Matt Gonzalez and the left supporting Khanna — it’s Lite Guv Gavin Newsom, who beat Gonzalez for mayor of SF, along with Ron Conway and the tech industry. And  instead of talking about failed US military policies, he’s talking about bringing the interests of Silicon Valley to Washington:

“The premise of this campaign is quite simple,” Khanna told the crowd. “We’ve had quite brilliant people…use technology to change the world. And it’s time that we actually change politics, that Silicon Valley has the potential to do this.” “It’s not just about having a tech agenda. This is about something much deeper — our values, and our ability to use those values to change Washington and the world,” he told them.

Now: It’s not as if Mike Honda has been horrible to Silicon Valley. He’s been involved in all sorts of tech-related issues. But he’s of a different generation, and however stereotypical it may be to say it, there’s a certain level of ageism in the tech world right now. Honda is old; the wealth in the tech world is overwhelmingly young. Politico notes:

Khanna’s decision to take on Honda also reflects a long-standing frustration among many young California pols who have been patiently waiting for older members to exit the state’s congressional delegation. Last year’s induction of an independent redistricting committee and a jungle primary system in which the top two finishers in an open primary advance to the runoff regardless of party affiliation, helped push many senior members into retirement.

Oh, and Honda is very much a pro-labor guy. And tech firms are almost never unionized, and their owners and workers don’t tend to have the same sympathies for labor unions as young activists did 20 years ago.

Politico doesn’t give Khanna much of a shot; it’s going to be a tough battle. Honda’s been around the district forever, and has no apparent scandals or gaffes (and unlike poor Pete Stark, he doesn’t seem to be losing his marbles).

But money talks, and Khanna’s got a lot of it — and in some ways, this will be a new-money-v.-old-Democratic Party, tech v. labor kind of battle that will say a lot about where Bay Area politics are going as the region’s population, and wealth, are dramatically and rapidly changing.