Board of Supervisors

Editorial: No more silence on PG&E’s statewide power grab

David Talbot
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Every single elected official, candidate for office, and political group in the state that isn’t entirely bought off by PG&E needs to loudly oppose Prop. 16 – now

EDITORIAL Pacific Gas and Electric Co. has found few allies in its effort to halt the spread of public power in California. The Sacramento Bee has come out strongly against PG&E’s initiative, Proposition 16 on the June ballot. Los Angeles Times columnists have denounced it. Six Democratic leaders in the California Senate have called for the company to withdraw the measure. Even the California Association of Realtors, hardly a radical environmental group, has come out strongly against the measure, in part because it’s so badly worded that it could halt residential and commercial development in large parts of the state.

But PG&E has already set aside $30 million to try to pass this thing – and since the cities and counties that would be hit hardest can’t use public money to defeat it, elected officials across the state need to be using every opportunity they have to speak out against it.

Prop. 16 is about the most anti-democratic measure you can imagine. It mandates that any local agency that wants to sell retail electricity to customers first get the approval of two-thirds of the local electorate. The two-thirds majority has been the cause of the debilitating budget gridlock in Sacramento, and it will almost certainly end efforts to expand public power or create community choice aggregation (CCA) co-ops in the state.

It actually states that no existing public power agency can add new customers or expand its delivery service without a two-thirds vote — which means, according to former California Energy Commissioner John Geesman, that no new residential or commercial development in the 48 California communities that have public power could be given electricity hook-ups.

It also, of course, eliminates the possibility of competition in the electricity business, making PG&E the only entity legally allowed to sell power in much of Northern California. That’s a radically anti-consumer position that most residents of the state would reject – if they understood it.

And there’s the problem. With PG&E spending $30 million (of our ratepayer money) promoting this, using misleading language and a campaign based on lies, and with very little money available for a counter-campaign, it’s going to be hard to get the message out.

That’s why every single elected official, candidate for office, and political group in the state that isn’t entirely bought off by PG&E needs to loudly oppose it, now.

And there’s still a lot of silence out there.

State Sen. Mark Leno and Assembly Member Tom Ammiano, to their credit, are not only opposing Prop. 16, they are helping lead the campaign against it. Sup. Ross Mirkarimi has helped build the coalition that’s running the No on 16 effort. The San Francisco Board of Supervisors has passed a resolution opposing the initiative. Sup. Bevan Dufty, who is running for mayor, is a public opponent. State Sen. Leland Yee’s office told us he opposes it (although he hasn’t made much of a big public issue of the measure). Same for City Attorney Dennis Herrera.

But where is Mayor Gavin Newsom? Where is District Attorney Kamala Harris, who is running for attorney general? Where’s Rep. Nancy Pelosi and Sens. Dianne Feinstein and Barbara Boxer? Where’s the City Hall press conference with the mayor and every other elected official in town denouncing Prop. 16 and urging San Franciscans to vote against it?

The silence is a disgrace, and amounts to a tacit endorsements of PG&E’s efforts.

And it’s happening at the same time that the supervisors are pushing against a tight deadline to get the city’s Community Choice Aggregation program up and running.

San Francisco is the only city in the United States with a federal mandate to sell public power, and the city is moving rapidly to set up a CCA system. This is a monumental threat to the city – and everyone either in office or seeking office needs to recognize that and speak out. Prop. 16 and CCA ought to be a factor in every local organization’s endorsements for Democratic County Central Committee and supervisor this year, and any candidate who can’t stand up to PG&E has no business seeking office in San Francisco.

The attack on the SF left

Zelda Bronstein
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The attack on the SF left

If I were a political consultant hired by the San Francisco Chamber of Commerce and the big developers and the landlords and Mayor Newsom, and my job was to launch an effective attack on the progressive movement in the city and undermine progressive control of the Board of Supervisors, here’s what I’d do:


1. I’d attack district elections. See, every time the downtown folks have tried to run candidates in swing districts under the existing system, they’ve lost. That’s in part because the business types can’t seem to find decent candidates, and part because money doesn’t rule in districts, so progressives who can mobilize at the grassroots level have a better chance.


So when you can’t win the game you try to change the rules. You can’t do it too directly, because the polls show that people like having district supervisors, so I’d come up with a “hybrid” plan — say, seven districts and four at-large supervisors. Since anyone who runs at large in this city needs gobs of campaign cash, that would pretty much guarantee that four board members would be accountable to downtown. Then draw the districts to create two moderate-conservative seats, and the progressives have lost control.


I’d launch this by planting stories in the San Francisco Chronicle about a “growing movement” to change the way the supervisors are elected — even thought there is no real grassroots movement.


But that creates the appearance that’s needed to begin raising money and preparing for a ballot initiative. It’s not hard to get the Chron to bit on something like this; C.W. Nevius, the local columnist who lives in the East Bay suburbs, never liked district elections, so he’ll play along and the Chron’s corporate ownership, which is close to the Chamber folks, never liked the system either. You can expect an editorial from the Chronicle Feb. 28th calling for a partial repeal of district elections.


The argument won’t have anything to do with the fact that the Chron doesn’t like the policies this particular board has passed; it will be all about the need for a “citywide perspective.” Now, that’s just horseshit, since the district boards have done an immense amount of work on citywide issues (like mininum wage and health care) that the at-large boards would never do.


But “citywide perspective” is a term that’s been focus-group tested and sounds good.


2. I’d look for a nice wedge issue for the November elections — something that could be used against progressives in swing districts. When Newsom ran for mayor the first time, he used “care Not Cash” — a well-funded attack on homeless people.


And gee, guess what? There’s another nice anti-homeless measure that’s recently been floating around, and it comes from the media-savvy police chief, George Gascon. It’s called a “sit-lie” law — legislation that would criminize the act of sitting on the sidewalk. It’s got a lot of populist zing to is, particularly since Gascon is talking about the need to clean up Haight Street, where some ill-behaved young people have been bothering the merchants and shoppers.


A November ballot initiative on a sit-lie law would allow downtown to raise a lot of money — and attack people like Rafael Mandelman and Debra Walker, candidates for supervisor in districts where a simplistic attack on the homeless might play. 


3. I’d try to split the city’s labor movement and drive labor away from the progressives. The obvious tactic: Construction jobs. I’d get every construction trade union member to campaign in District 10 for a supervisor who will support Lennar Corp.’s redevelopment project, and I’d attack any supervisor or candidate who supports limits on, say, buildings that shadow the parks and call them anti-jobs.


4. I’d launch a quiet effort to raise a big chunk of money to push pro-downtown candidates for the Democratic County Central Committee. The DCCC used to be something of a political backwater, but under progressive control, it’s become a significant force in local elections. The DCCC controls the local Democratic Party endorsements and money — which can be a big factor in district supervisorial races.


Now: I have no evidence that any individual consultant has created any such plan — but it’s sure an interesting coincidence, isn’t it?


What I see right now is a coordinated, orchestrated attack on the left — and I’m getting a little nervous that our current leadership on the Board of Supervisors isn’t doing enough about it.


 

SF Weekly mangles Mexican politics

Zelda Bronstein
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SF Weekly mangles Mexican politics

The SF Weekly, in its continuing effort to make everything the progressives in San Francisco do look stupid, just stepped in a major turd. A piece by Matt Smith seeks to trash the supes for passing a resolution supporting Mexican electricity workers against an effort by the Mexican government to privatize the nation’s electricity system.

He notes:

However, the government of Mexico felt this one to be so egregious as to warrant fact-checking. As it happens there was no privatization. The government transferred Luz y Fuerza del Centro to a much larger power utility called the Comision Federal de Electricidad — which is, you guessed it, also government-run.

 His single source for that information? The (utterly unbiased, of course) Mexican consulate.

Well, John Ross, our Mexico City correspondent, who has lived there more more than 25 years, has written several books on Mexican politics and is nationally known an expert in the area, has written about this issue extensively. I just sent him Smith’s blog post, and here’s how he responded:

Consul general Carlos Felix Corona’s response to the Board of Supervisors resolution re Felipe Calderon’s efforts to break the mexican electricity workers union (SME) is disingenuous. The Luz y Fuerza Company was forced to buy electricity from the federal electicity commission (CFE) at an exorbitant price, with the costs then passed along to the consumer by presidential fiat. The CFE itself now buys a third of the electricity it generates from private corporations — in violation of the Mexican Constitutionl, which ascribes electricity generation as a state function, thus privatizing electricity generation in Mexico City and five other states in the center of the country. According to the SME, whose workers were forced out of the generating plants and which the Mexican Labor Commission has now stripped of its authority to represent the workers, Luz y Fuerza lines will now be sold off to W Communications, a Madrid-based transnational represented in Mexico by two ex-energy secretaries (Calderon himself is an ex energy secretary). W Communications is expected to install fiber optic cables on the old Luz y Fuerza lines. The Calderon administration will no doubt wait several months to seal this deal until the clamor about priviatization recedes. But the contracts have been signed, so don’t be fooled by the consul’s disingenuous response that Luz y Fuerza has not yet been privatized. Now that US unions and the SF Board of Supes have expressed their solidarity with the electricity workers, Felix Corona, a shill for calderon, seeks to bamboozle San Franciscans that all is honky dory South of the border and that protest marches that regularly turn out a quarter of a million Mexicans are just the work of a few malcontents  

So there’s another side to this story, Matt, and the consulate is hardly a trustworthy source.

 

Newsom’s getting closer

Zelda Bronstein
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There are really only two obstacles to Newsom’s jumping into the Lt. Gov.’s race. One is the possibility that he might lose, but he would be the instant front runner. The other is the supposed fear of leaving the city in the hands of whatever mayor the Board of Supervisors chose.

And according to the Chron’s politics blog, he’s gotten over the second hurdle:

“It’s no surprise I’m looking at running for another office,” he continued. “I’m out of here. I’m termed out anyway…I do take my job seriously, but I’m capable of doing a lot of things at one time. By definition, it’s a skill set I must have.”

He added that if people are so concerned about one of the supervisors becoming mayor for the year before the next scheduled mayoral election, maybe they shouldn’t have elected them to the board in the first place.

“If it’s just concern with me leaving, maybe they should look at who they elected,” he said.

 

 

Clean money campaign launches in SF

Sasha Cuttler
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Clean money campaign launches in SF

The campaign for Prop. 15, the California Fair Elections Act, kicks off in San Francisco this Sunday afternoon. It’s an appropriate city to launch this effort, given San Francisco’s leadership on electoral reform, from our pioneering ranked choice voting system to our low political contribution limits to the public financing available in the races for mayor and the Board of Supervisors.

As I discussed in an article this week’s paper, the measure would create a pilot public financing program in the 2014 and 2018 races for the Secretary of State, funded by a $350 annual fee on lobbyists and their employers. It was placed on the ballot by legislation pushed primarily by Bay Area legislators Loni Hancock, Mark Leno, and Tom Ammiano.

Those legislators, along with Sup. Ross Mirkarimi, campaign chair Trent Lange, and California Nurses Association president Deborah Burger, are scheduled to speak at the event, with takes place at 1 p.m. outside the Main Library, 100 Larkin Street.

Notes from the Sierra Club’s gala dinner

Sasha Cuttler
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While I focused on Jerry Brown’s disappointing speech to the Sierra Club San Francisco Bay Chapter’s gala dinner on Wednesday night, there are a few more notable nuggets in my notebook worth posting here, starting with what appears to be the collapse of plans for a California Constitutional Convention.

The Guardian recently reported on the difficulties that the campaign was having, but consultant Clint Reilly told me that the effort is basically over, with fundraising shortfalls being the final nail in the coffin. That’s one more reason why “hope” seems to be in such short supply on the political landscape.

The event was held in the Merchant Exchange, a building owned by Reilly, who helped underwrite the gathering. So it was no surprise that the evening was MCed by his wife, Janet Reilly, who is running a strong campaign to replace Michela Alioto-Pier on the Board of Supervisors.

There were lots of political luminaries at the event (list to follow), but there was one particularly notable attendee and particularly notable absence. Los Angeles City Council member Janice Hahn was one of the few politicos from down south, making the rounds in support of her run for lieutenant governor. But Mayor Gavin Newsom, who is considering challenging her, didn’t show up.

Also a no-show was U.S. Sen. Barbara Boxer, who appeared by video to address the gathering and express appreciation for being the recipient of the Sierra Club’s first Phillip Burton Badge of Courage Award for environmental stewardship. Accepting the award on her behalf was California Democratic Party chair John Burton, who was his usual salty self, taking a dig at the San Francisco Chronicle by referring to someone who wrote “for the Chronicle back when that was a newspaper,” and describing the award’s namesake thusly: “My brother was an outstanding environmentalist who didn’t like the outdoors much.”

He also made this funny, self-effacing crack at the start of his speech: “I think a third of the people in this room would like to see the accelerator stuck on the rug of my Prius.” I was not among that third.

There was a strong turnout of local political leaders, but tellingly, only from the left side of the political spectrum. The members of the Board of Supervisors who turned out were David Chiu, Chris Daly, Ross Mirkarimi, Eric Mar, and John Avalos. Other political luminaries on hand included City Attorney Dennis Herrera, Sen. Leland Yee (Yee and Herrera are each running for mayor) City College trustee John Rizzo (who introduced Brown), Senator-turned-Oakland mayoral candidate Don Perata, District Attorney Kamala Harris, Rep. Jerry McNerney, and Sen. Loni Hancock.

Taser trouble

Zelda Bronstein
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Taser trouble

You can say this for Police Chief George Gascon: He’s not shy. He’s pushing so many things, on so many fronts, that it’s hard to keep track, and some of them are real problems. One example: The Feb. 17th Police Commission meeting, where Gascon paraded a bunch of experts to talk about how great it would be if the SF cops had tasers.

I’m not against tasers per se; I’d rather the cops were shooting people with less-lethal weapons than with pistols. Quite a few people might be alive today if the more trigger-happy among Gascon’s force pulled a trigger that didn’t send a deadly bullet into a suspect’s body.

But you have to remember that a taser can be a lethal weapon, too; people die from taser blasts.

And when I talked to the folks in the SFPD public affairs office recently, they told me that the chief was drafting guidelines on the use of tasers, and that the taser would fall somewhere in between the use of a baton (non-lethal in all but the most exceptional cases) and a gun (lethal). That’s the wrong approach — and it’s what’s missing from Gascon’s argument.

A cop is only allowed to pull a gun in a situation where lethal force is justified; that is, when the officer’s life of the life of another person is in imminent danger. Same rules should go for the taser. That’s where the commission has to come in, because I don’t think Gascon is going to make that policy.

In fact, I’m getting the impression that the chief doesn’t like anyone else to make policy for him. That’s why he’s got an oped in the Chronicle today that goes after two proposals from Sup. Ross Mirkarimi. Gascon:

The San Francisco Board of Supervisors has proposed two pieces of legislation that would directly impact my ability as chief to provide effective and efficient public safety. One of these pieces, which would establish a community-based foot-beat patrol program, directs subordinates under my command to establish staffing levels absent my direction or control. The second, which seeks to require the police department to itemize the cost of dignitary protection, would jeopardize the safety of public officials who receive valid threats against themselves or their loved ones. These legislative proposals directly circumvent my ability to lead this department effectively. This ultimately makes the goal of making San Francisco the safest large city in America more difficult to achieve.

Translation: I don’t like the San Francisco supervisors setting law-enforcement policy. But actually, that’s the board’s job — to set the rules for how all city departments, including the SFPD, operate.

I can’t figure out why Gascon is fighting this foot-patrol legislation. He admits that foot patrols are a good idea and would solve a lot of crime problems. He just says he doesn’t have the budget. So take that to Mirkarimi and the other board members; tell them you’ll do foot patrols if they’ll fund it. Discuss the police budget in open session with the Budget and Finance Committe (which Mirkarimi sits on) and look for ways to make it work.
That’s how things get done in this city.

Transamerica condos: the mystery continues

Zelda Bronstein
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5
Transamerica condos: the mystery continues



I’m not going to actually suggest that anyone watch all four hours-plus of the Planning Commission hearing last week on the highrise condo tower at 555 Washington. But if you’ve got the time, it’s a fascinating video.


And here’s what’s most interesting: A lot of the discussion revolved around what Commissioner Michael Antonini said was a need to continue the item to a later date. That’s because three of the commissioners — the ones appointed by the Board of Supervisors — were dubious about the project’s environmental impact report, so it would take all four of the mayoral appointees to let the project go forward. But Commissioner Gwyneth Borden couldn’t make the meeting. Antonini went ballistic at one point, and stormed out of the room, saying that it was disrespectful to Borden not to grant a continuance.
 
That struck Commission Vice-President Christina Olague as kind of odd. “I was taken aback by the accusations that we were somehow being insensitive,” she told me. “To my knowledge, Commissioner Borden never made any request for a continuance. There was nothing in writing and she never communicated it to me.”


But then the strangeness started to happen. Commissioner Hisashi Sugaya moved not to certify the environmental impact report on the project. That motion was defeated, 3-2, with Antonini off in a huff somewhere and Borden absent.


Now, normally, in these situations, the president looks for a substitute motion. In this case, a motion to approve the DEIR could have been made, and that, too, would have been defeated. Once the motion to approve went down, the DEIR would be scuttled and the developer would have to start again.


But instead, the commission secretary simply announced that the matter would be continued to March 18. And a week later, I’m still trying to figure out how that was possible.


After all, the commission had decided — openly, in public — NOT to accept a continuance. Then all of a sudden, without a vote of the body, Antonini got his way. The DEIR will be heard again, presumably with the mayor’s fourth vote present.


This is a major project, and I’m not going to argue that it’s fate should hang on an issue of procedure. But nobody has been able to explain to me how a matter gets continued without a vote to continue. The best I can figure is that without any motion on the floor, and no action pending, the secretary had no choice but to continue the matter.


“It all happened so fast,” Olague said. “I want to go back and review everything to see exactly what ocurred.”


Attorney Sue Hestor, who opposes the project, told me that after the lengthy list of serious flaws with the DEIR, which were presented in great detail at the hearing, it will be hard for the commissioners to certify the document. But the pressure from the Mayor’s Office is intense — Michael Yarne, the mayor’s Economic and Workforce Development advisor, was at the meeting, cornering commissioners outside. And four of the members serve at the mayor’s pleasure.


 

The people vs. corporate power

Andrew Lam
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The people vs. corporate power

steve@sfbg.com

The June 8 election is shaping up to be one that pits the people against powerful business interests, a contest that will demonstrate either that money still rules or that growing public opposition to corporate con-jobs has finally taken root.

On the state level, the five ballot measures include two brazen money-making schemes and two experiments in election reform, along with primary races that are still in flux. In San Francisco, where the ballot measures still have a few more weeks to shake out, the election will feature two rarely contested judges races, recession relief for renters, City Hall fiscal reforms, and a fight for control of the local Democratic Party.

So far, only four local measures have qualified for the San Francisco ballot, all placed there by members of the Board of Supervisors. Progressives qualified the Renters Economic Relief package (which limits rent increases during recessions and sets conditions for landlords passing costs to tenants), an initiative establishing community policing standards, and one affirming city support for making Transbay Terminal the northern high-speed rail terminus. Supervisors were unanimous in supporting a charter amendment governing the Film Commission.

But the board is still hashing out changes to the more controversial ballot proposals, a debate that will continue at its Feb. 23 meeting. They include an overhaul of how the city funds its pension program and an effort to remove Muni salary minimums from the city charter, both by Sup. Sean Elsbernd; a $652 million seismic safety bond proposed by Mayor Gavin Newsom; and a Sup. John Avalos charter amendment that would prevent the mayor from unilaterally defunding certain budget expenditures. All measures must be approved by March 5.

Also still forming up in the coming weeks are primary races for legislative seats (although no incumbents appear to be facing strong challenges) and all eight state constitutional offices, including governor (where Attorney General Jerry Brown seems poised to easily win the Democratic nomination), lieutenant governor, and attorney general (which District Attorney Kamala Harris is running for).

Candidates have until March 12 to declare themselves for statewide and legislative offices, as well as for the San Francisco Democratic County Central Committee, which could play a key role in this fall’s Board of Supervisors elections. Two years ago, a slate of progressives led by Aaron Peskin and Chris Daly launched a surprise attack to wrest control of the board away from the moderates who have long controlled it. Newsom, U.S. Sen. Dianne Feinstein, and their downtown allies are expected to try hard to regain control over their party’s purse-strings and endorsements.

 

JUDGING THE JUDGES

Another struggle from two years ago is also being replayed. In 2008, then-Sup. Gerardo Sandoval successfully challenged Superior Court Judge Thomas Mellon, arguing the Republican-appointed jurist was too conservative (and the entire court is not diverse enough) for San Francisco. This time the target is Judge Richard Ulmer, a conservative appointed by Gov. Arnold Schwarzenegger. Ulmer is being challenged by two LGBT attorneys, Daniel Dean and Michael Nava, the latter endorsed by Sen. Mark Leno, Assembly Member Tom Ammiano, and Peskin, who chairs the Democratic Party and could be helpful in the race. “He’s a brilliant guy,” Leno said of Nava.

Leno also has endorsed deputy public defender Linda Colfax, a Latina lesbian, in a four-way race to replace retiring Judge Wallace Douglass. The other candidates are Harry Dorfman, Roderick McLeod, and Robert Retana. If no candidate wins a majority of votes, the top two finishers square off in a runoff election in November.

Leno said he’s thrilled to see a diverse crowd of attorneys seeking judgeships: “This governor has failed horribly in his appointments, not only with the LGBT community, but with communities of color as well.”

 

TWO COMPANIES TRY TO BUY CALIF.

The struggle between the broad public interest and the wealthy power brokers that have long-dominated California politics is most apparent in the state propositions, which have been certified and for which ballot arguments are now being collected by the California Secretary of State’s Office.

Two of those ballot measures, Propositions 16 and 17, are blatantly self-serving efforts by a pair of powerful corporations to increase their profitability, however deceptively and with overwhelming amounts of campaign cash they are presented.

Prop. 16, sponsored by Pacific Gas & Electric Co., would require local governments to get two-thirds of voters to approve creation of energy programs like Clean Power SF, San Francisco’s plan for developing renewable energy projects and selling that power directly to citizens.

As we’ve reported (“Battle royale,” Jan. 13, and “PG&E attack mailer puts City Hall on defensive,” Dec. 22, 2009), PG&E placed the measure on the ballot to avoid having to repeatedly crush public power initiatives around the state with multimillion dollar campaigns, even though political leaders like Leno and Sup. Ross Mirkarimi say the measure violates the state’s community choice aggregation law. That law allows local governments to create energy programs and prohibits PG&E from interfering with those efforts.

“The unregulated behavior of corporate arrogance is killing our democracy. Prop. 17, sponsored by Mercury Insurance, would let companies increase car insurance premiums for a variety of reasons that are now prohibited by the 1988 measure Prop. 103. Mercury has continuously attacked that landmark law, using lawsuits, huge political contributions, sponsored legislation, and, according to newly released documents from the California Department of Insurance (see “The malevolence of Mercury Insurance,” Feb. 10, Guardian Politics blog), blatantly illegal activity in setting premiums and excluding certain customers, such as artists, bartenders, and members of the military.

“The Mercury initiative is even more pernicious than what it was doing before,” Harvey Rosenfield, who wrote Prop. 103 and works for Consumer Watchdog, told the Guardian. “Under Mercury’s initiative, if you’ve never had prior insurance, you can be surcharged for the first time. Then they’ve thrown in some other tricks and traps.”

Mercury spokesperson Coby King told us the company has been unfairly maligned and denies that the measure is simply about boosting its profits: “Prop. 103 is the law of the land, but to the extent there are improvements that can be made that are pro-business and pro-consumer, Mercury has not been shy about acting in the public interest.”

Yet few public interest groups or public officials believe the claims being made by Mercury or PG&E, and they hope that the public won’t be fooled.

“These are measures designed to give a financial advantage to a specific industry or company,” U.S. Rep. John Garamendi, who battled Mercury as California’s first insurance commissioner, told us. He strongly opposes both measures, but did say, “Money talks. It always has, particularly in propositions.”

Yet Leno said he’s a bit more hopeful: “Californians have been savvy in the past, and I do believe they’ll be able to see through the tens of millions of dollars in misleading ads.”

“To me, it’s a classic case study of what’s going on with the initiative process in California and with politics in general,” said Derek Cressman, western regional director of California Common Cause. “There are two initiatives literally sponsored by corporations to push very narrow interests.”

Yet Cressman said recent events could help. There’s been a big public outcry in recent weeks over the U.S. Supreme Court’s decision to allow unlimited corporate spending to influence elections, the role that insurance companies played in sinking federal health care reform efforts, and the way businesses interests are hindering efforts to deal with global warming.

“It makes people aware of the overwhelming role corporations are playing in dictating government policy,” Cressman said.

 

TAKE OUT THE MONEY

A pair of election reform measures might help lessen the influence of money and political parties. Prop. 14 is an open primaries measure that Sen. Abel Maldonado (R-Santa Maria) got placed on the ballot as a condition for breaking last year’s budget stalemate. It would create a single primary ballot and send the top two finishers to the general election, regardless of party.

Prop. 15, the California Fair Elections Act, takes direct aim at the corrupting influence of money in elections, creating a pilot public finance program in the secretary of state races for 2014 and 2018. The measure, which has broad support from politicians and good government groups in the Bay Area, is modeled on successful programs in Maine and Arizona.

“No elected official should be in the fundraising game the way they are now,” campaign chair Trent Lange told us. “This is a way to change how we fund elections.”

The idea is to create a model that will eventually be used for other offices. The campaign fund would be generated by a $350 annual fee on lobbyists, lobbying firms, and lobbyist employers. Currently lobbyists pay just $12.50 per year to register, which Lange said, “just shows the power of lobbyists in Sacramento.” *

 

The “Newsom wins” merry-go-round: What fun

Zelda Bronstein
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10
The “Newsom wins” merry-go-round: What fun

Gavin Newsom still hasn’t said for sure that he’s in the race for lt. governor, although just about everyone in town now thinks he’s going for it.

But the very prospect of the mayor leaving office before his term is up has the political classes speculating: Who gets that job? And how does it happen?

It’s actually pretty interesting.

Under the City Charter, the president of the Board of Supervisors becomes acting mayor in the event that the mayor leaves office before the end of his or her term. Then the supervisors, by a six-vote majority, can appoint someone else to the job.

Melissa Griffin lays out one piece of the scenario, which is that the board could appoint a new mayor in advance, without anyone serving as acting mayor.

But there’s much more to the story.

According to a fascinating city attorney’s opinion issued in 1978 (PDF), when George Moscone and Harvey Milk were killed and Dianne Feinstein was board president, no supervisor is allowed to vote on his or her own appointment. Which would mean that if, say, Board President David Chiu wanted the job, he’d need six votes not including his own.

Now the plot thickens. Suppose nobody can round up six votes — that is, a majority of the supervisors can’t agree on a new mayor? Well, Chiu, as board president, would be acting mayor — potentially for the entire duration of Newsom’s term, roughly a year. He’d also remain as board president. It’s the same as if the mayor goes out of the state and names an acting mayor in his place; that person is still a supervisor. So Chiu would have all the powers of both the mayor and the board president — and immense amout of clout for one person at City Hall.

But wait, there’s more: Chiu is board president only until the board elected in November of this year takes office, which would be about five days after Newsom would become lite guv. So unless the current board can choose a new mayor, with six votes (not including the vote of any supervisor being nominated), the new board would elect a new board president — who would instantly become acting mayor at the same time.

And since supervisors are allowed to vote for themselves for board president, any member would be allowed to vote for him- or herself for acting mayor.

Confused yet? Clearly, the folks who wrote the City Charter never actually envisioned this scenario (or didn’t think about it very much).

Of course, what that means that with the current board split the way it is, with exactly six solid progressive votes, someone who isn’t currently on the board (say, Aaron Peskin — or Tom Ammiano, or Mark Leno, or whoever) would have a better chance of getting a majority than a current member, who would need at least one of the moderate bloc votes.

And if Newsom runs, it will make the fall supervisorial elections even more important, because potentially those newly elected supes will be choosing not only a board president but a mayor.

Here’s another fun twist: If District Attorney Kamala Harris is elected attorney general, the mayor gets to appoint a new D.A. But suppose Newsom also wins and is sworn in a few minutes before Harris. Presumably acting mayor David Chiu (a former prosecutor who rumor has it might like to be D.A. himself someday) would choose the new D.A. — and suppose Chiu knows he doesn’t have six votes to be mayor. There’s no reason why he couldn’t appoint himself D.A., leaving a vacancy on the board and a vacancy for board president, which would be filled by anyone who could get six votes, who would then be acting mayor and could appoint a new supervisor to Chiu’s seat. Who could then be the deciding vote on who gets to be mayor.

Whoa. I can’t wait. Run, Gavin, Run.

Labor’s love lost

Andrew Lam
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4
Labor’s love lost

Note: This file has been corrected from an earlier version.

rebeccab@sfbg.com

Two recent events could have major implications for Service Employees International Union Local 1021 — San Francisco’s largest public-sector union and an important ally for progressives — for better or for worse. And this union’s fate seems closely tied to that of the progressive movement in San Francisco.

The first event was likened to a “nuclear bomb in the morning paper” by one observer, and might be interpreted as the kickoff to a fierce budget battle. Mayor Gavin Newsom announced that he is considering a plan to help solve next year’s budget deficit by laying off 10,000 full-time city workers and rehiring them at 37.5 hours, which would amount to a sweeping 6.25 percent pay cut for workers and an estimated $50 million in savings for a fiscally impaired city.

Though it was framed by Newsom spokesperson Tony Winnicker as one preliminary cost-saving option among many, the proposal received prominent front-page coverage in the San Francisco Chronicle, even before official discussions were called between the mayor and public sector unions. Since SEIU Local 1021 represents 17,000 members in San Francisco and a majority of the city’s 26,000 total employees, it would likely absorb the greatest impact if such a plan went through.

At the same time the mayor’s startling announcement hit newsstands, SEIU was in the midst of mailing out ballots to its membership for union elections. “I don’t know whether it’s a coincidence, or if the city is taking advantage of the fact that SEIU is absorbed in its elections,” Sin Yee Poon, an SEIU chapter president for Human Services Agency workers, told us while pointing out that the events happened simultaneously.

With three separate slates of candidates vying for control of SEIU Local 1021, grudges between warring internal factions have intensified into bitter sparring matches. The timing is unfortunate — just as SEIU’s internal turmoil is coming to a head, one of its greatest battles is pending over an unprecedented $522 million budget shortfall that looms like a dark cloud over the city. The deficit will surely result in job losses, and the public sector union’s ability to mount resistance even as it wrestles with internal strife is shaping up to be a key question.

This pivotal moment carries wider political implications considering that the progressive organization has in the past helped seal an alliance between San Francisco’s left-leaning leaders and organized labor through the San Francisco Labor Council.

With SEIU besieged by infighting and soon to be hurting from wage slashes and layoffs, more conservative factions of the labor community, such as the San Francisco Firefighters Union and the Building and Construction Trades Council, have recently been butting heads with progressive members of the Board of Supervisors.

At the same time, forces on all sides are beginning to eye the coveted seats up for election in June at the Democratic County Central Committee, a Democratic Party hub that is a cornerstone of local political influence, as well as the seats that will open up on the Board of Supervisors in November. Negotiations between unions and the mayor are ongoing, and mayoral spokesperson Tony Winnicker was quick to note that Newsom is open to options, other than reconfiguring 10,000 city jobs, that organized labor brings to the table. At the same time, the Guardian heard from numerous sources that city workers felt outraged and blindsided by Newsom’s decision to air the plan in the Chronicle instead of bringing stakeholders to the table.

SEIU Local 1021 President Damita Davis-Howard told us she thinks the idea of taking $50 million out of the pockets of working people in a rocky economy is wrong-headed.

“This was devastating,” said Davis-Howard, who is running for a newly created union position called chief elected officer, which is different from the union president, and similar to an executive-director post. “The mayor might as well have raised their taxes, because if you decrease their pay by 6.25 percent, they will still have the same amount of work, they will still have to pay the same mortgage, they will still have to buy the same food, the same PG&E, and they’ll be doing it with a lot less money. If any idea like this were to go through, it would actually remove the very fabric or fiber of San Francisco. It would really cut to the core of the very being of San Francisco. … I don’t see how anybody could believe that we could continue being the city that we love being with this kind of action.”

Winnicker, the mayoral spokesperson, cast it as a plan that could avert hundreds or even thousands of layoffs. “This year the easy decisions are behind us,” he noted in a recent discussion with the Guardian.

Solving last year’s fiscal shortfall was far from easy — budget tussles between frontline city workers and the mayor got ugly, and even then, the city received millions in federal stimulus dollars to cushion the blow. A similar plan of sweeping hourly cuts was floated then too, but it didn’t gain enough traction to move forward.

“The mayor is facing a huge budget deficit, there’s no question about it — but he has not lifted one finger to raise a dime in revenue,” charged SEIU member Ed Kinchley, who works at San Francisco General Hospital. As for how the union might respond if such a proposal went through, he speculated, “I think it’s the kind of thing that could lead to a strike. A big fight.”

While the city charter bars strikes by public employees, Kinchley’s comment indicates the level of frustration among SEIU’s rank-and-file.

 

 

The proposal could present a common enemy and a rallying point for a union in disarray. Internal jockeying for elected positions can be fierce in any organization, but for San Francisco’s service-workers union, the rifts are particularly deep.

The elections, which will be decided Feb. 28, mark the first time since a radical restructuring in 2007 that members will collectively decide who should lead. In 2007, the face of SEIU was changed across California when the international president, Andy Stern, began consolidating dozens of far-flung locals into centralized, beefier entities in a bid to maximize political effectiveness (California comprises roughly one-third of the entire union’s membership).

Local 1021 came into existence when 10 locals were conglomerated into one 54,000-member giant — hence the “10-to-one” label — representing health care and frontline service workers from the Bay Area to the Oregon border. 

In San Francisco, where a large segment of its members are based, the shift was interpreted by some as a power grab, and it triggered a period of ongoing strife between those allied with Stern and the international wing on one side, and those dissatisfied with changes they saw as antithetical to the democratic ideals championed by Local 790, its predecessor, on the other.

In the years following the reorganization, Stern began trying to aggregate members by raiding other unions to consolidate power. But campaigns to bring in members from United Healthcare Workers (UHW) and fend off membership losses to the newly created National Union of Healthcare Workers (NUHW) have consumed money and resources that some members told the Guardian would’ve been better spent bolstering national support for health-care reform and the Employee Free Choice Act. According to one source, SEIU spent $10 million on a Fresno battle against NUHW.*

A fight waged between SEIU Local 1021 and UNITE HERE Local 2, a hotel-workers union that was historically allied with Local 1021’s predecessor, left some members especially stung because it marred a longstanding relationship between two groups of frontline workers.

“Andy Stern has concentrated more and more power into the hands of a group of so-called elite members of the union,” Kinchley told the Guardian. Stern’s top-down leadership style and growth-oriented objectives “run pretty harshly against what many of us believe is in the best interest of our workers locally,” he added.

In recent weeks, divisions have deepened further. A staff person who preferred not to be identified for fear of retribution filed charges with the U.S. Department of Labor against a supervisor, who is aligned with the international faction, for alleged harassment and bullying. Another complaint was filed with union leadership alleging that union bylaws were violated when membership money was authorized, but not spent, to conduct a poll without proper approval.*

“There’s a fiscal rogue-ness about it. [Davis-Howard] does whatever she wants, and she spends our dues money without authorization from anybody,” Kinchley charged.

Stern appointed Davis-Howard, and now she is running for election on a slate aligned with the international wing. When the Guardian tried to reach her to discuss union elections, spokesperson Carlos Rivera told us that Davis-Howard found it inappropriate to publicly discuss internal divisions.

Sin Yee Poon is running as her opponent on a reform slate, formed by members disaffected by the international’s modus operandi. “For the whole reform group, we’re disappointed with the general direction of corporate unionism,” Poon told the Guardian. Stressing that she believes grassroots, democratic ideals have eroded since the restructuring, she said members in her camp are agitated when they see resources siphoned into raids on other unions such as UNITE HERE and UHW. “We want it to be member-driven,” she said. “The raiding of other unions is absolutely not OK.”

 

 

The internal strife could have a wider ripple effect. SEIU Local 1021 has historically been influential in securing an alliance between the city’s labor community and San Francisco’s progressive leadership. During the last round of elections for San Francisco’s Board of Supervisors, Sups. John Avalos and Eric Mar campaigned and ultimately were elected with strong fundraising support from the labor council.

Yet in recent weeks, several skirmishes pitted certain factions of the labor community against progressive members of the Board of Supervisors. Outrage bubbled up from the firefighters — and ultimately the labor council as a whole — against a charter amendment proposed by Sup. John Avalos that would have extended the minimum number of work hours for firefighters.

Billed as a cost-saving measure, the proposal might have ultimately resulted in fewer firefighter jobs, but it was designed to spread the pain of budget cuts more equitably by grazing public safety departments instead of just inflicting blows on frontline and healthcare workers.

After Labor Council Executive Director Tim Paulson came out strongly against it, Avalos abandoned the idea. A source from within the labor council, who spoke on background only, described it as an opportunity for the labor council to come together and unite on class interests.

The political posturing that came out of that fight shook even Sup. David Campos, who vocally called for equitably sharing the pain during last year’s budget debacle. “This isn’t the way to do it,” Campos said when asked about Avalos’ failed charter amendment. “And I worry about the negative impact on labor and the progressive board. There are larger issues at play here. The entire progressive agenda is at stake. We need to think long-term about the specific issues plus the future of the progressive movement.”

Sup. Sean Elsbernd’s bid to reform the pension system to save money has provoked yet another fight with SEIU Local 1021. Union members argue that if they are asked to contribute to their own retirement funds, which would become mandatory under this proposal, then they should be given the same wage increase that other unions were granted when they agreed to similar terms.

But when Sup. Eric Mar tried to amend Elsbernd’s proposal by inserting language guaranteeing that pay increase, Elsbernd said it would cost the city millions more. If Mar’s amended version goes forward, “you’ll be going to the voters by yourself,” Elsbernd told the progressive-leaning supervisor at a Feb. 9 board meeting.

 

 

Another fight has erupted over 555 Washington, a tower proposed to go up beside the TransAmerica Pyramid, which was debated at a joint hearing Feb. 11 between the Planning Commission and the Recreation and Park Commission. For members of the Building & Construction Trades Council, which represents unionized carpenters, plumbers, and other workers in development-related trades, the project represented jobs — the screaming priority in an economy where funding for new construction has trickled to almost nil.

“There is, in general in San Francisco progressive politicians, a knee-jerk reaction to development projects,” Building & Trades Council Secretary Treasurer Michael Theriault told us. As a council representing people whose livelihoods depend on private sector construction, “We have a particular quandary,” he said. “We need politicians who at the same time are friendly to labor and understand that development is an economic tool that can help the city.”

The arm of labor representing Theriault’s council has been slammed with job losses due to the economic downturn, and he’s publicly expressed frustration when projects of this scale are shot down.

“What the mayor did, what Elsbernd did, and what Avalos did are all the same thing: They all staked out a position, put a provocative idea on the table, and forced unions to have a discussion with a gun to their head in a non-constructive way,” Mike Casey, president of UNITE HERE Local 2 and a member of the labor council’s Executive Committee.

A source familiar with the inner workings of the labor council said the tension between building trades and firefighters versus more left-leaning members of the labor community has been in existence for decades, and it isn’t anything new — particularly in the months preceding election season.

Casey challenged the very notion that there is a subculture of the labor council that isn’t progressive, pointing out that labor came together as whole to support Sups. Avalos, Mar, and David Chiu — “and I personally would do it again in a heartbeat,” he added. Internal catfights and struggles for control come with the territory in a democratic, diverse organization, he said. “As a group of working people, I have great regard for the membership [of SEIU Local 1021],” he said. “Occasionally there’s a dustup. In my experience, after the dust settles, more often that not, unions come out stronger for it.”.

*Corrections made to the original file.

Newsom’s $72 million corporate giveaway

Sasha Cuttler
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Newsom’s $72 million corporate giveaway

City economist Ted Egan yesterday released his analysis of the payroll tax exemption for new hires that Mayor Gavin Newsom has proposed, one of several business tax cut proposals that we discuss in this week’s Guardian. Egan estimates that the net revenue loss (which takes into account taxes paid by the new hires) to the city would be $72 million over the next two years.

“The proposed policy will have a strong positive effect on local hiring, albeit at a steep costs the City’s General Fund,” Egan wrote, later adding, “The policy would also make the City’s serious current budget deficit worse, and likely lead to significant employment reductions in the City’s workforce.”

While the tax breaks amount to only about 1 percent of businesses’ payroll costs, Egan’s models predict they would spur the creation of 4,330 jobs, or about 5 percent of the jobs lost since 2007. Yet he also notes that the unemployment rate in San Francisco has been dropping in recent months and the economy is predicted to add about 20,000 jobs in the next two years even without this subsidy by taxpayers.

Both Newsom and Egan have tried to cast these tax breaks as similar to the approach being taken by President Obama. Egan writes, “The policy is a targeted tax cut that mirrors the President’s New Jobs Tax Credit, which is supported by a wide range of economists.”

But the big difference is that the federal government can deficit-spend and doesn’t have to reduce its own spending, which would have a negative impact on economy, as Egan’s report acknowledged a few pages later: “Because the City cannot run a fiscal deficit from one year to the next, the lost revenue would necessitate reductions in City staffing and services, like any revenue shortfall.”

The report specifically doesn’t analyze the impact of that reduced government spending on the local economy, with Egan writing that, “is not considered, because the City could adjust to that impact in many ways.” New taxes, for example, which Newsom has avoided proposing as a partial solution to the city’s gargantuan $520 million projected budget deficit.

In an interview with the Guardian this morning, Egan also affirmed what he has told us before, that the consensus among economists is that direct government spending stimulates the economy more than tax cuts, even though these tax cuts tied to new hiring are better than general tax cuts.

For example, Egan said that another current Newsom tax cut proposal – a $2,000 tax break for businesses that provide health care to employees – “would have a negative effect on the economy” because it doesn’t encourage hiring.

While the report is generally favorable to the notion of these targeted tax cuts, it doesn’t make a recommendation. And it does take away a key argument that Newsom and other believers in trickle down economics generally make, that the tax cuts will ultimately be paid for by increased economic activity. Instead, the report shows the cuts will cost $85 million of two years and the new hires will generate $12 million in increased sales, hotel, and other taxes. Even stretching that analysis out over 10 years, assuming the new hires remain employed after the tax exemption ends, the reports says the policy will still cost the city $42 million.

Sup. John Avalos, the chair of the Board of Supervisors Budget and Finance Committee who has been skeptical of Newsom’s tax cut proposals, has set a Feb. 24 hearing on the proposal.

Basically, this is a policy decision rooted in ideological beliefs: Should the city subsidize private companies at great cost to the public treasury, payroll, and services? Does the public sector exist solely to serve private corporations? Economic conservatives who are hostile to government generally think so, but progressives think it’s crazy to make deep cuts to government spending and services just to subsidize private sector economic growth, most of which is going to occur naturally anyway.

Sunshine and shadows

Jesse Hawthorne Ficks
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Sunshine and shadows

tredmond@sfbg.com

It was, the San Francisco Chronicle proclaimed, the end of the world for development in the city, or at least something close to that. A ballot measure, sponsored by Sup. David Chiu, restricting new buildings from casting shadows on city parks “could imperil major development projects,” a Jan. 28 article by John Cote said. “Everything from a new wing at the San Francisco Museum of Modern Art to the expansion of the Moscone Center and creation of a new downtown core around a rebuilt Transbay Terminal could be affected.”

A lot of that is wildly exaggerated. The Chiu ordinance, which has since been pulled from the ballot pending a city study of the issue, would hardly have halted all development — or even all high-rises — in San Francisco. It wouldn’t have gutted the Transbay Terminal plan (although it might have forced planners to reduce the height of a tower that would soar 400 feet above the tallest building in San Francisco). In fact, the real story is how Chiu has managed — for now — to stop a backroom attempt by developers to undermine a 25-year-old environmental law. We found some fascinating evidence of how Mayor Gavin Newsom has been working with the San Francisco Chamber of Commerce to undermine Chui’s efforts — using broad threats to try to get his way.

Chiu’s legislation sought to clear up a couple of loopholes in a landmark 1984 law, which passed on the ballot as Proposition K. The measure, authored by then-Sup. Bill Maher, essentially barred any new construction that would cast a significant shadow on a city park.

In 1989, the final implementation guidelines were approved, and they’ve stopped literally hundreds of proposed projects from casting dark shadows on public open space.

But in the past year, city planners have been meeting with lawyers for big developers and looking for a way to change the rules. Citing new technology that better measures the curve of the earth and complex algorithms that calculate sunlight, the Planning Department has since proposed revising the Prop. K guidelines — in a way that would allow taller buildings and more shadows without getting the approval of voters or supervisors.

Chiu told us he’s been trying for months to find out exactly what the proposed guidelines would do — how many new buildings, at what heights, would be able to shadow which parks. “I was unable to get any answers,” he said.

The measure he drafted would have barred any new guidelines that allowed more shadows — and would have required the Board of Supervisors to sign off any changes. It would still allow the city to make case-by-case exemptions for projects that cast minor shadows but are otherwise deserving of approval — affordable housing developments, for example.

But downtown went nuts — and Newsom joined the fray.

The crux of the opposition came from the Chamber — and is outlined in an e-mail from Chamber Vice President Rob Black to members of the Chamber board.

“The mayor was very direct and clear about the need to defeat the measure,” the e-mail, which we obtained, states. “The mayor was also very clear that he was in no mood for deal-making on the issue and that he would look very unfavorably on any developer or anyone else who tries to cut a deal with David Chiu on the issue. He literally said, you will be on your own for the next two years if you go there.”

Black confirmed that the e-mail was in fact his — but said the version we’d obtained “has been edited. Some words were changed and other omitted.” He refused to say what the changes were, saying that the e-mail was meant to be a confidential communication to his board. However, he confirmed that the basic message and descriptions of a meeting with Newsom were accurate.

Tony Winnicker, Newsom’s press secretary, confirmed that Newsom had been directly involved in trying to scuttle the ordinance — and didn’t deny the mayor had made those threats.

“The mayor made clear the importance of asking the supervisor to withdraw the measure,” Winnicker wrote in an e-mail to us. “The mayor was clear that backroom deal-making should not be tolerated on the issue.”

Chiu was somewhat aghast at the mayor’s statements. “The context for all this is that the developers and their lawyers were trying to change the rules,” he said.

Aaron Peskin, the former supervisor and longtime North Beach neighborhood activist, told us that the “hysteria around this is factually untrue. This isn’t about stopping development — it’s about making sure development doesn’t have an adverse impact on the city’s common space.”

So now Chiu has agreed to hold off — but only if the key stakeholders (not just developers) have some input into how planning devises new shadow rules. And he’s ready to go back to the ballot in November if the developers try to play games again.

That makes sense, Gabriel Metcalf, executive director of the San Francisco Planning and Urban Research Association, told us. “There should be a heavy burden of proof on the people who want new rules,” he said. “And there should be a heavy burden of proof for anyone who wants a ballot measure.”

In other words, Prop. K — as it is, as it’s stood all these years — is working pretty well. And if the developers hadn’t tried to sneak in some big changes, none of this would have happened in the first place.

The “jobs” shell game

Jesse Hawthorne Ficks
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The “jobs” shell game

Written with Nima Maghame

news@sfbg.com

While many San Francisco city officials have been trying to figure out how to close a projected budget deficit of more than $520 million, Mayor Gavin Newsom has spent the last month trying to make that spending gap even larger by aggressively pushing a variety of business tax cuts that economists say will do little to improve the local economy and could actually make it worse.

Newsom first proposed his so-called “local economic stimulus package” a year ago during his ill-fated run for governor, just as President Barack Obama was pushing his own economic stimulus plan. But unlike the federal government’s $787 billion plan, about a third of which involved tax cuts demanded by conservatives, Newsom proposed to cut local business taxes while also deeply slashing local government spending and laying off hundreds of city workers.

Most economists say that’s a terrible idea. In fact, a report issued at the time by Moody’s Investor Services made it clear that every dollar of direct government spending adds about $1.60 into the economy (or $1.73 if it’s on food stamps, the most stimulative spending government can make), whereas business tax cuts add only about $1 to the economy for every dollar spent.

We clashed with the Mayor’s Office at the time on our Politics blog (see “Mayor Newsom doesn’t understand economics,” 2/13/09), with Newsom’s spokesperson telling us the mayor was relying on the input of City Economist Ted Egan. But when we interviewed Egan about the issue, he agreed that it’s a bad idea to slash government spending to pay for tax cuts.

“We were in no way saying you should cut taxes to stimulate the economy, particularly if it means reducing government spending,” Egan told us then. And when we asked directly whether it’s better for San Francisco’s economy for the city to directly spend a dollar on payroll or to give that dollar away in a private sector tax break, he told us, “The consensus among economists is that most of the time government spending stimulates the economy more.”

The Board of Supervisors basically ignored Newsom’s proposal. But he revived it last month, expanding the proposals with even more private sector subsidies and making them the centerpiece of his Jan. 13 State of the City speech, publicly pushing it since then with a series of public events at businesses located in the city.

And this time — with the local economy still slow, projected city budget deficits bigger than ever, and little serious talk about how the city can bring in more money — it appears the proposals will be the subject of a series of hearings before Board of Supervisors’ committees in the coming weeks.

Newsom’s tax cut proposals include a proposal to waive the 1.5 percent payroll tax (the city’s main business tax) for all new hires; extend and expand the payroll tax exemption for biotech companies (see “Biotech’s bonanza,” p. 12); give small businesses tax credits for their spending on health plans; and allow developers to pass one-third of their affordable housing in-lieu fees onto future homeowners.

Newsom and his Press Secretary Tony Winnicker have spoken euphorically about the proposals, saying they’re desperately needed to spur the local economy. “We believe that enacting these tax incentives, particularly the payroll tax credit for new hires, is one of the single biggest things we can do for economic growth,” Winnicker said.

Despite repeated questions about the economists’ concerns over financing tax cuts with government spending cuts, we couldn’t get them to address the tradeoff directly. “The mayor will support critical public services,” was all Winnicker would say about the deep cuts that Newsom is expected to announce in his June 1 budget.

Sup. John Avalos, who chairs the Board of Supervisors Budget and Finance Committee, expressed more skepticism about the mayor’s proposals. “Do tax breaks have the intended effect of stimulating the economy? As we underfund government services, are we getting a net gain or are we getting something taken away? For the very small businesses in my district, it’s going to be trickle-down economics. It’s very unrelated and unmeasurable in benefit,” he told us.

David Noyola, board aide to President David Chiu, said his boss is supporting the biotech tax credit but reserving judgment on the rest. “It’s going to be a cost-benefit analysis,” Noyola said. “When we’re talking about jobs, we’re talking about public and private sector jobs, always.”

While Egan’s economic analysis predicts tax cuts will encourage some economic growth, even he is circumspect about the good it will do, particularly without finding a way to avoid deep cuts in city spending. “The truth of the matter is that our stimulus efforts are small because the city has relatively small power to affect the local economy,” Egan told us.

That’s the consensus economic opinion. Huge federal spending can help a national economy a little bit, but local economies are just different animals that local governments are largely powerless to really alter, particularly through tax cuts.

“I agree with Egan: city government has little power over the local economy,” Mike Potepan, an urban development economist at San Francisco State University, told the Guardian.

Both economists agree that tying tax cuts to job creation or development stimulus is better than general tax cuts, but that neither is good if it means laying off more city workers.

“Research shows that by cutting taxes you have more business activity where studies show it is likely to effect employment,” Potepan said. “On the other side, you have to think about revenue. Cities are going to have to balance their budgets, which could mean a cut in services.”

Author Greg LeRoy expresses a more critical perspective in his book The Great American Jobs Scam: Corporate Tax Dodging and the Myth of Job Creation (1995, Berrett-Koehler), amassing evidence from economic studies and CEO surveys that corporate tax breaks, even those tied to new job creation, have almost no effect on private companies’ decisions about where to locate and whether to hire.

“How can companies get away with this? Because the system is rigged. Corporations have it down to a science. They have learned how to chant ‘jobs, jobs, jobs’ to win huge corporate tax breaks — and still do whatever they wanted all along,” LeRoy writes. “That’s the Great American Jobs Scam: an intentionally constructed system that enables corporations to exact huge taxpayer subsidies by promising quality jobs — and lets them fail to deliver. The other benefit often promised — higher tax revenues — often proves false as well.”

While proposing to forgo collecting millions of dollars in payroll taxes (the Controller’s Office is still working on a projected total for the tax cut package), the Mayor’s Office also wants to spur development of new housing with a proposal that would delay collection of needed affordable housing money by more than a decade.

After hearing mostly from a large crowd of desperate developers and construction workers during a Jan. 21 hearing on the proposal, the Planning Commission approved the package on a 4-3 vote, with the mayor’s appointees in agreement and the board’s appointees in dissent. It will be considered by the Board of Supervisors Land Use Committee sometime after Feb. 12.

The most controversial part of the fee reform package involves reducing the fee developers pay to support affordable housing by 33 percent, then charging a 1 percent transfer tax to subsequent buyers of those homes. Egan estimates developers would save almost $20,000 per housing unit, and that it would take an average of 16 years for the city to recover that money. But for high-rise luxury condos, the city would eventually recover about $27,000 per unit.

“It’s a classic make-an-investment-now-to-get-more-later strategy,” Michael Yarne, who crafted the policy for the Mayor’s Office of Economic and Workforce Development at Newsom’s direction, told the Guardian.

“If it makes it feasible for projects to be started, then it is worth passing,” Tim Colen, a representative of San Francisco Housing Action, said at the Planning Commission hearing, expressing hope that it will help create desperately needed construction jobs and new market rate housing.

But affordable housing advocates and some progressives criticize the policy as completely backward, saying that affordable housing development is desperately needed now, during these tough economic times, rather than a policy that encourages more market rate housing and bails out bad investments made at the height of the real estate bubble.

“What the city needs to do is directly build affordable housing, for which there is a demand,” affordable housing activist Calvin Welch told us. “The problem is that the banks don’t want to lend these guys money because they know nobody can afford to buy houses at the prices that these guys are demanding.”

Debra Walker, who is running for supervisor from District 6 and voted against the proposal when it came before the Building Inspection Commission (the sole vote on a commission dominated by mayoral appointees), agrees.

“The whole argument is that it stimulates development, but it doesn’t,” Walker said, arguing that the incremental gains (about 25 housing units per year, Egan estimates) will be offset by delayed affordable housing construction. “There would be more economic stimulus by using the fee to build more affordable housing.”

Instead, it simply shifts resources to favored entities: from home owners to developers, in the case of the affordable housing fees, or in the case of the tax credits, from the public to the private sector. But Newsom’s office just doesn’t see it that way.

“The Guardian believes in protecting public sector employees over private sector employees,” was how Winnicker formulated our understanding of what the economists are saying. “Most people don’t work for the city, and if we can support private sector jobs, that adds to sales tax revenues and benefits the economy. Despite a short-term impact of the tax credit, that’s a benefit.”

Adam Lesser contributed to this report

 

Biotech’s bonanza

Jesse Hawthorne Ficks
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0
Biotech’s bonanza

By Adam Lesser

news@sfbg.com

It’s difficult to measure the value a biotechnology company receives from locating in San Francisco. Most measures are qualitative: scientists talk about synergy with other biotech companies in the area, the intellectual community that thrives at the University of California-San Francisco, and support offered at the California Institute for Quantitative Biosciences (QB3).

But the quantitative costs are easier to calculate, beginning with rents that often are two to three times higher than in the East Bay or South Bay. Add San Francisco’s 1.5 percent payroll tax, and companies can begin to attach a dollar figure to the premium of being in San Francisco.

To incentivize biotech companies to locate in San Francisco, Mayor Gavin Newsom is asking the Board of Supervisors to extend the six-year-old Biotech Payroll Tax Exemption. The exemption allows any new biotech company to get a full 7.5 years without paying local business taxes as long as it files for the exemption by Dec. 31, 2014.

At a time when San Francisco city officials are struggling to close a budget deficit of more than $500 million — for which Newsom hasn’t offered any significant revenue proposals to help bridge the gap — some are questioning why the city should continue giving millions of dollars in tax breaks to the thriving biotech industry.

The core question of whether the payroll tax credit has worked in bringing more biotech companies to San Francisco is complex. While Newsom boasted of attracting 54 new biotech companies in the last five years during his Jan. 13 State of the City address, analysis of the credit by Ted Egan, the city’s chief economist, indicated that only eight companies had applied for the credit by the end of 2008.

The thriving research environment at UCSF-Mission Bay and the establishment of the state taxpayer-funded California Institute for Regenerative Medicine have played significant roles in creating a favorable environment for young biotech companies. The last five years also have seen broad growth in biotech as scientific discoveries have accelerated. Would biotech companies have come to San Francisco regardless of the payroll tax exemption?

The city’s Office of Economic Analysis looked at the question of how effective the payroll tax exclusion actually has been in spurring biotech growth. Because the size of the incentive — an exemption from paying a 1.5 percent tax on its total payroll — is relatively small, Egan felt that there could not be a conclusive link between the exemption and biotech growth. But he did feel there was some benefit, writing in his analysis that “in fact, the primary worth of the incentive may lie in its marketing value and how it signals to the industry that San Francisco is a credible location for biotechnology.”

Between 2004 and 2008, the biotech tax credit cost the city $1.2 million. If costs stay on pace with 2008, the existing Biotechnology Tax Exclusion will cost at least an additional $2 million. There are no cost estimates yet on extending the credit to give all biotech companies the full 7.5 years of payroll tax exclusion.

The extension faces opposition. Sup. John Avalos, chair of the Board of Supervisors Budget and Finance Committee, has expressed concern about the effectiveness of tax credits.

“I’m not sure the city is going to be able to show a direct connection between taxes and the growth of the biotech industry. The verdict is still out for me,” Avalos told the Guardian. “We’ve created the whole infrastructure for the industry around Mission Bay. That could have a lot to do with companies coming to San Francisco.” The city donated a portion of the land the UCSF-Mission Bay campus was built on.

Allopartis Biotechnologies is a small biotech startup in QB3 at UCSF-Mission Bay that has received venture capital funding. It saved $3,670 in 2009 by qualifying for the payroll exclusion. Allopartis has six employees and focuses on developing technologies to convert biomass into sustainable fuels.

“You pay a premium to be in the city, and it’s worth it,” said Robert Blazej, cofounder of Allopartis. “We’d like to stay close to this nexus of innovation and collaborators. But it’s going to be challenging with the cost of square footage.”

Interviews with other growing San Francisco businesses showed that their biggest concern was the cost and availability of commercial real estate. Zynga, a social gaming company in Potrero Hill, plans to add 800 jobs over the next two years. Newsom has asked for an additional waiver on payroll taxes for all new hires over the next two years, regardless of industry.

“We considered moving out of San Francisco for a couple reasons. One is the availability of commercial real estate. The other is the payroll tax,” said Chief Financial Officer Mark Vranesh. “The large blocks of space we would be looking for are hard to find.”

But as the city tries to plug gaps in dwindling city services, concerns are mounting about how much the city can give away to companies under the premise that tax credits create new jobs. In the debate about the biotech tax credit, objections have been raised about the fundamental fairness of giving a tax break to one industry while others still pay their share. Similar next generation industries with large up-front research and development costs such as solar energy or fiberoptic Internet do not receive payroll tax waivers.

Economists such as the Tax Foundation’s Patrick Fleenor are quick to point out that there are no political advantages to taxing everyone equally. “The problem is a political one. If you tax everyone the same, there aren’t politicians creating little fiefdoms. There aren’t ribbon-cutting ceremonies,” he said.

Avalos has equated judging the effectiveness of tax credits at creating jobs to looking into a crystal ball. But the price tag of each tax credit is borne in the present as the city contemplates laying off hundreds of city workers.

Adding to the political infighting have been public complaints by Sup. Michela Alioto-Pier that Newsom is trying to take credit for the biotech payroll exclusion, which she originally proposed and helped legislate in 2004. She requested an extension for the biotech tax credit in November. Her office has defended the bill. “We’re creating a hub so that other biotech companies can come to San Francisco,” said Bill Barnes, Alioto-Pier’s legislative aide. “When she was courting biotech, she was hearing that the payroll tax was an impediment.”

But other cities charge local business taxes comparable to San Francisco’s payroll tax. And if there was ever an industry that has been heaped with support from the public sector, it is biotech.

Proposition 71 passed with 59 percent voter support in 2004 and established the CIRM, which provides grants and loans for stem cell research. Stem cell research is an area within biotech that has seen significant political support, particularly since the time of the Bush administration, when federal funding for embryonic stem cell research was heavily restricted.

But appearing to be doing something about the economy remains politically important, even if the actual benefits are somewhat dubious.

“It’s a big political game that the mayor is playing. He wants to paint progressives as anti-jobs, which is ridiculous, and paint himself as the mayor for jobs,” Avalos told us. “We would be cannibalizing government services for the private sector.”

Newsom has been vague about whether he accepts that tradeoff or even understands its implications to city coffers and the local economy. Newsom Press Secretary Tony Winnicker recently told us, “He thinks it’s good policy to spur private sector job growth.”

Later, he added: “While not every company has taken advantage of it, we feel extending it sends the right message,”

Newsom’s perplexing attack on San Francisco’s economy

Sasha Cuttler
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Newsom’s perplexing attack on San Francisco’s economy

There’s a crazy disconnect in City Hall these days over how to help the local economy. Mayor Gavin Newsom has spent much of the last month focusing on “jobs” and “local economic stimulus,” proposing to give a few million dollars in tax breaks to local companies while refusing to discuss new tax measures to help close the city’s $522 million budget deficit.

As we explain in detail in tomorrow’s Guardian, economists just don’t think the tax cuts will help the economy much at all – particularly if the city is reducing its spending and payroll to do so — but even some progressive supervisors are playing along to appease the anxious business community. For example, Board of Supervisors President David Chiu supports an extension of the biotech tax, denying city coffers the benefit of efforts by the city and UCSF to become an important hub for the industry.

Then, in today’s Chronicle, Newsom floats the idea of unilaterally shortening the workweek for city employees in order to save $50 million in payroll costs, firing 10,000 workers and then rehiring most of them to do so. But let’s be clear about this: that means removing $50 million from San Francisco’s economy, or even more once you figure in the multiplier effect that would more than double that loss.

As much as Newsom and his Chamber of Commerce allies love to bash government, the city is one of San Francisco’s largest employers, a clean industry with good-paying jobs. And it just makes no sense why they prefer to inflict mass layoffs on that employer – not to mention the reduced city services that will hurt even private sector productivity — rather than increase taxes on large corporations that ship their profits out of the city and therefore offer minimal benefits to this city’s economy.   

 

Recalling Sophie Maxwell

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Written with Adrian Castañeda

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Does it make sense to try and recall termed-out D. 10 Sup. Sophie Maxwell?


A group of District 10 residents has turned in 8,008 signatures in an effort to recall Sup. Sophie Maxwell. Election department staff says that 7,529 signatures must be verified for the recall attempt to go forward.

‘We think it’s going to be a little tight,” said an election department worker, who preferred to remain anonymous.

Department of Elections staff have 30 days to count and verify the submitted signatures, but they predict the process could be completed as early as Thursday afternoon (Feb. 4) or Friday morning (Feb. 5).

Meanwhile, Maxwell is termed-out in January 2011–a mere 11 months away. And 15 candidates have already filed to enter the D. 10 race this fall, with a dozen others variously threatening to throw their hats in the ring.

But if the recall effort gets the green light and is placed on the June 8 ballot, and if Maxwell actually gets recalled as a result of that vote, Mayor Gavin Newsom would then get to appoint his choice of successor to her seat. And if that successor happens to be one of the candidates vying for Maxwell’s seat, wouldn’t that person have an enviable edge come the November election?

Bayview activist Daniel Landry insists the recall effort would be effective. 
“We’re sending a message to anyone who wants to be a supervisor of D-10, you must recognize the will of the voters,” Landry said.

D 10 candidate Ed Donaldson warns that any supervisor that does not understand the complexity of the city’s largest district can expect a similar backlash. He says the recall effort is evidence of District 10’s diversity.
“There is no one homogenous voice in the community,” Donaldson said.
He says that the current grass-roots organizing that brought about the recall effort is a result of changing political structure in the area, but is not yet on par with the other districts in town.
“We still allow our politics to be controlled from downtown,” Donaldson observed.

D 10 candidate Espanola Jackson warns that if Newsom appoints someone, that person had better listen to the wishes of the community, or else they will face a similar fate to Maxwell.

“What the mayor needs to understand is that if we can get the signatures in two weeks to recall Sophie, we can get them on whoever he appoints as well,” Jackson said.

But D 10 candidate Eric Smith worries that the recall effort will backfire. He cites a recent community meeting in the Bayview on the Department of Park and Recreation’s budget, as an example of why folks are turning to this seemingly desperate strategy.

“People were emotional, angry and desperate, because they feel no one listens to them,” Smith said. “That’s part of the problem here; they would rather have a supervisor go down swinging for them, rather than watch one seemingly side with Lennar, PG&E and the Mayor on issues contrary to their interests. At the DCCC [Democratic County Central Committee] last week, everyone except Chris Daly voted against the recall in support of Sophie.”

Smith added that Daly’s vote, “likely had more to do with his belief that this was a waste of time and had no chance of actually succeeding, but you’ll have to ask him.”

Daly, for his part, says he doesn’t believe the recall effort will qualify.

“Jake McGoldrick introduced an item in committee when he was a supervisor that the Board then passed that doubles the numbers of signatures required for a recall to qualify,” Daly said, noting that under the old recall rules the current effort would likely have succeeded in getting onto the ballot.

“And I don’t think the DCCC’s resolution against the recall effort was accurate,” Daly added. “It was long on the fact that Sophie isn’t guilty of malfeasance, but the truth is that a recall is a tool of democracy that is available and can be applied in cases where a representative is not being responsible to the needs of their district. So, while I’m not supportive of recalling Sophie, it would be patronizing for me to say that thousands of D. 10 residents don’t know what they are doing. The Democratic Party (with a capital D) is working against democracy (with a small d) in a patronizing way in a district that has a disproportionately high number of low-income folks and people of color. There is a significant level of disgruntlement, if that is a word, in District 10, and its residents have lodged a pretty real and significant complaint.”

Aaron Peskin, who chairs the DCCC’s executive board and is the former President of the San Francisco Board of Supervisors, also predicts that the effort to recall Maxwell is probably headed nowhere.

“There’s no way they got the numbers,” Peskin said. “You’re lucky if 50 percent of that shit runs.”

Peskin proffers three reasons why recalling Maxwell is against the community’s own interests.
“First, recalls are an instrument to be used when a representative has committed malfeasance, and not because you disagree with the political positions of a person who has been duly elected three times,” Peskin said. “Second, this elected official is in her last eleven months in office. So, it’s a huge waste of time and money. And third, for those not satisfied with their current supervisor, any representative that the mayor might nominate would be far, far worse.”

Smith also worries that the recall effort is akin to the community shooting itself in the foot.

“If Sophie gets recalled, (and that is a very big if), the Mayor will insert someone and we may be right back where we started from, or worse. That’s the terrible irony and one of the biggest problems in District 10. Folks are so mad, they’re willing to do whatever it takes to make them feel they have a voice in the outcome, even if it’s potentially worse. The same thing happened with the Navy and the Restoration Advisory Board. Some of the same folks who were frustrated by the process, tried to send a signal to the Navy that they weren’t being heard and for all their well- intentioned efforts, got the RAB dissolved. I truly feel for them, it’s absolutely heartbreaking, but at times, they can be their own worst enemy.”

To Smith’s mind, a recall has the potential for exacerbating the very problems the effort is purported to be about.

“This isn’t about malfeasance, or not showing up for work,” Smith observed. “It’s about being heard, respected and listened to. I don’t think any other Supervisor has ever had the challenges that Sophie has had to face here; the Bayview, the Hunters Point Shipyard’s toxic super-fund site, the homicide rate, unemployment, poor public transportation, dwindling services and community resources have made D10 one of the City’s largest melting pots of discontent. It’s just one of the reasons I’m running. The health, welfare, quality of life issues and the environment are the things I put above everything else out here, particularly above special interests and big money.”

“We will soon know how valid those signatures are; I can tell you that the many of the folks behind it feel very confident about it,” Smith continued. “But Sophie still has a lot friends in D10 who will not vote her out, so even if this makes the ballot, there is no guarantee it will carry. There are many, many folks who still love and support Sophie, so the folks who signed the recall petition will have to overcome the balance of the 37,000 D.10 voters who may not want to see her go and have a vested interest in seeing a fair electoral process in November, untainted by a Mayoral appointee, an appointee that would have implied advantage over any of the candidates in November.”

Smith has asked many folks why they are launching a recall when Maxwell only has 10 months left on the job.

“For them, it’s about making a statement; they want everyone to know that ‘They’re mad as hell and not going to take it anymore,’” Smith said. “They also want to send a signal to the D10 candidates that this is what you will face if you don’t listen to them. D10 is not for the squeamish, those easily intimidated or the faint of heart.”

On a side note, Smith observed that “we will need the world to come out to defeat Proposition 16″, the PG&E ballot measure in June. “And, depending on the turn out, many of the folks needed to come out for that, may also play a role as it relates to Sophie’s recall.”

Asked what she thought of the effort to recall her, Maxwell characterized it as “strange” and “destabilizing.”

‘It seems to me that this effort is destabilizing the community,” Maxwell said. “When you undercut the leadership, you destabilize a community in transition. At a time when these folks could have something to say about the future, they are looking at the past. It’s about backward thinking. It’s about not having the best interests of the community. It’s about egos. Because if this is for the community, then why not bring something to the table that’s about bringing some direction to the district?”

One of the last straws, in the minds of some recall signature gatherers, was Maxwell’s 2009 vote against a resolution that would have advised the Navy to restore its community-based Restoration Advisory Board. This board, which was established in 1994, had consistent access to the many technical and environmental documents surrounding the proposed clean-up of the heavily polluted Hunters Point Shipyard.

The RAB, whose primary fucntion was to share information on investigations and clean-ups at the shipyard, was also able to vote on the Navy’s proposed solutions and to request more information and/or speakers and experts so its members could educate themselves on related public health and safety issues. But early last year, the Navy announced that it was dissolving the RAB, citing dysfunctional behavior and off-topic discussions that were getting in the way of the RAB’s intended purpose.

The move to dissolve the RAB came just as the Navy was poised to take a series of important decisions on some of the most polluted and radiologically-impacted parcels on the shipyard. And many in the community saw the timing of the RAB’s dissolution as evidence that the Navy was going to ignore their wish to have these parcels dug out and hauled away, and not capped (a wish shared by the 87 percent of voters who supported Prop. P in 2000.)

But despite the outcry that followed the RAB’s 2009 dissolution, Maxwell voted to tell the Navy to either restore the RAB or find other ways to involve the community–thereby giving the Navy the choice, some felt, to ignore the community’s desire to reinstate the RAB.

And last night, the Navy, along with a flotilla of police and special agents, showed up at the Bayview YMCA to share its plan to reformulate the Navy’s original Community Involvement Plan—a plan that angered many meeting goers ( the majority of which were former RAB members,) since it didn’t appear to aim at reinstating the RAB. But to give the Navy credit, once it became clear that meeting attendees were underwhelmed by its plan, Navy officials scrapped their original agenda and allowed the community to speak instead about their wounds from the past and their hopes for the future. It remains to be seen where the Navy will go next, but those interested in tracking these developments can visit the Navy’s website for updates.

Maxwell for her part defended her vote–and pointed the finger at the Navy.

“The Navy has an obligation to get out its plans to the public,” Maxwell said. “People are getting information in many ways, these days, not just by coming to meetings. The Navy has just got another $92 million towards the shipyard clean up, but does anyone know what this means? It means that instead of taking years to clean up groundwater at the shipyard, we can spend that money on it, now. And if folks knew what capping really means, maybe they wouldn’t be against it. Mission Bay is capped. Schlage Lock will be. And all of them are brown fields.”

Maxwell worries that democracy is not currently being well served within her district, but not by her.
“There are folks who are trying to block real information from getting out, and if only your view can get out, that’s not democracy,” Maxwell said.

But so far, she’s not willing to publicly support anyone in the November D. 10 race.
“I’m waiting for people to have a better understanding of what this community is, what the common thread running through it is, and how to use rank choice voting,” she said.

And despite the current recall effort—and the insults regularly hurled her way with a voracity and meanness not generally seen in other supervisorial districts, Maxwell said she has truly enjoyed serving as D. 10 supervisor.

“When people say that it’s an honor to serve as an elected official, I really know what they mean, because I really feel that. Democracy is challenging, it’s messy and it’s invigorating. I think a lot of what’s going on in my district is about people using people. But what has changed for these folks? Their lives have gotten worse, not better. And they are going after me, because I am not part of their group. I have tried to stay focused on the issues.”

 

Progressives should care about pension reform

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Progressives should care about pension reform

OPINION In today’s failing economy, with double-digit unemployment and huge government deficits, progressives have a strong interest in ensuring that San Francisco’s pension system remains viable.

After years of working and contributing a percentage of their income to a pension fund, city employees receive a guaranteed annual pension based on an employee’s years of service and his or her pay level at retirement. In the private sector, most employees participate in a 401(k)-type of retirement plan, in which the pension is based on the amount contributed to the fund.

Under the city charter, the city is only required to pay into the pension fund when its liabilities exceed its income. When the fund loses money, as it has in recent years, the city is required to make up the difference.

In 2005, investments losses brought the fund below the break-even mark, requiring the city to pay $175 million in retiree pension and health premiums. Today, that number has grown to $525 million — an increase of 200 percent. Two years from now, in 2013, the amount will grow to $675 million, eclipsing what it costs to run San Francisco General Hospital for one year.

While headlines reporting pensioners who receive $100,000 or more raise the public’s ire, most retired city workers receive modest pensions. Still, there are abuses to the pension system that must be eliminated. A recent civil grand jury report found that some police and firefighters engage in pension “spiking” by promoting employees in their last year of service to increase the amount of their pensions. That practice has cost the city $132 million.

The question of how to address the city’s growing pension liability is now before the Board of Supervisors. A proposed charter amendment would change the contribution levels for police and fire employees hired after July 2010 from 7.5 percent to 9 percent and base pensions on the last three years of the employee’s salary to reduce pension spiking.

Some argue that the measure unfairly targets labor and city workers by eliminating pension formulas that have been used for decades. But with the city’s $522 million budget deficit, if San Francisco’s pension problem isn’t fixed, escalating pension costs will ultimately force city officials to confront this choice: make huge service cuts and layoffs or be unable to meet the city’s retirement obligations to its retired workers. That’s why we have to act now.

Other pension funds have faced this reality. One San Francisco union leader whose fund is paid by its workers told me that his union voted to reduce future pension benefits while increasing the amount of employees’ contributions. “It was a bitter pill, but we knew we had to do it,” he said.

The proposed charter amendment doesn’t go this far and only has a minimal impact on the city’s present pension liabilities since it only changes contribution levels for future employees. However, if the amendment reaches the June ballot, these modest reforms should not become a wedge issue.

Having a sustainable pension fund that protects the futures of workers without bankrupting the city is a progressive value. Progressives should also support ending pension abuses that only benefit a small number of workers at the expense of taxpayers and other workers who contribute to the fund. Pension reform is one step, among others, that must be taken to restore San Francisco’s fiscal stability.

Jeff Adachi is San Francisco’s public defender.

Editor’s Notes

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Editor’s Notes

The mayor of San Francisco is mad that the Board of Supervisors won’t even schedule a hearing on his proposals to stimulate business and job creation in San Francisco. He ought to be happy. If this loopy plan ever gets to the point of open, full discussion, Gavin Newsom will wind up with a real political embarrassment.

Let’s analyze, for example, the suggestion that the city waive payroll taxes for biotech companies. That’s supposed to make those companies more likely to hire new people. After all, any economist knows that taxing something discourages people from doing it, so taxing a payroll ought to make companies less likely to hire. And getting rid of that tax ought to create jobs.

Well, since one of the things I do is help run a small business in San Francisco, let me explain how it actually works.

Say you’re a biotech company that wants to hire a new entry-level worker at a modest $35,000 a year. Can you afford it? Let’s cost it out.

There’s the salary, of course. Then there’s the 7.5 percent you’re paying in federal Social Security tax. That’s $2,626 more. And since you’re in San Francisco, you’re paying for health insurance; that’s probably between $2,000 and $4,000 a year, depending on the plan, but let’s peg it at the city’s minimum mandate, which is $1.09 an hour, or $2,267.

So now your $35,000 worker costs $39,893. Then there’s unemployment and disability insurance and workers’ compensation. The person’s going to need a desk and a chair, or a lab bench and a stool (and they have to be ergonomically correct), and probably a computer, a phone line, and software. And you’re going to have to spend some money on training. You’re going to offer a couple weeks of paid vacation, right? And you have to give sick days. So you have to account for the money you’re spending to cover your new worker when he or she isn’t working. If it all pencils out at less than $42,000, you’re doing well.

Oh, wait, I forgot — there’s the damn city payroll tax. That job-killing factor that could make the difference between hiring and not hiring. Better account for that; it could be a deal breaker.

Are you holding your breath? Ready for the ax to fall? Here you go: the payroll tax on your new hire is a whopping $525 a year. About $10 a week. You probably spent more on the help wanted ads.

So let’s be honest — the payroll tax may sound awful (and actually, I think a gross receipts tax would be more fair, for a lot of reasons). But suspending it won’t create a single new job. It’s too small a factor to count as more than decimal dust in anyone’s hiring decisions.

Here’s what suspending the payroll tax for biotech companies will do: reduce city revenue, almost certainly by enough to force more program cuts, and that means more job cuts for city workers. So you gain no private sector jobs — zero — and you lose public sector jobs. How, exactly, is that encouraging employment growth?

Quit complaining, Mr. Mayor — the last thing your proposals need is real public scrutiny.

Sitting boundaries

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Sitting boundaries

Aggressive lobbying efforts by the San Francisco Police Department and some of its allies who are pushing a proposed sit/lie ordinance have irked some current and former members of the Board of Supervisors.

The legislation was privately created by new Police Chief George Gascón and then played up in the mainstream media. It would make it illegal to sit or lie down on public sidewalks. Supporters say it would make it easier for cops to target people who harass neighborhood residents.

But in other cities where similar laws have been passed, protests have erupted from homeless-advocacy organizations and civil liberties groups, which say criminalizing this behavior unfairly (and unconstitutionally) targets homeless people who have nowhere else to go.

In Portland, Ore., a similar law was enacted then overturned by the courts. In Los Angeles, an ordinance against sleeping on the sidewalk was challenged by the American Civil Liberties Union, resulting in the 9th Circuit Court of Appeals ruling in 2006 that unless adequate shelter is available for homeless people in L.A., arresting them for sleeping on the sidewalk amounted to cruel and unusual punishment.

But an e-mail action alert included in SFPD Central Station Capt. Anna Brown’s monthly community newsletter encouraged people to contact the mayor and the Board of Supervisors to support the creation of a sit/lie ordinance. “Naturally, there is resistance from the left-leaning Board of Supervisors who feel this is an attack on the homeless population,” it noted.

That unusually overt political plea caught the eye of Aaron Peskin, former president of the Board of Supervisors and current chair of the San Francisco Democratic Party, who called it “funky.” Peskin told us he’d never seen an advocacy pitch like this go out in a captain’s newsletter before, and he questioned whether this was an appropriate use of city resources.

But the City Attorney’s Office says this doesn’t fall under city laws banning electioneering by city employees, who are barred from using government resources to endorse a candidate or ballot initiative, or from doing any campaign-related work on city property.

Yet this kind of pitch “is not considered political activity,” Jack Song, a spokesperson for City Attorney Dennis Herrera, told the Guardian.

But Sup. David Campos, a former police commissioner, frowned upon it nonetheless. “Something like this is not really helpful to the Board of Supervisors and the Police Department working together,” Campos said.

Sup. Ross Mirkarimi took a similar view. At a recent Board of Supervisors meeting, he requested a hearing about the ordinance because he said the media-driven public debate had occurred without formal discussion. Anti-loitering and public nuisance laws are already on the books, Mirkarimi pointed out.

“What makes those laws inadequate?” he asked. “How would the proposed law augment what is already in effect?”

The alert wasn’t actually written by Capt. Brown, who included it in her newsletter. It was drafted by the Community Leadership Alliance, an organization headed by David Villa-Lobos, a longtime resident of the Tenderloin and a candidate for the District 6 Supervisor seat.

Since Gascón floated the idea of creating a sit/lie ordinance, CLA has kicked into high gear to mobilize support, most recently issuing its action alert e-mail to 8,000 recipients. Police captains were included in the e-mail blast, Villa-Lobos told us, but each captain decides independently what to include in his or her newsletter.

People sitting and lying on sidewalks is “a really, really big problem, especially in the crime-ridden areas,” Villa-Lobos said. “God bless the homeless, but it’s a big problem there too.” Several years ago, his organization tried to mount a campaign for a sit/lie ordinance, but it didn’t go anywhere. “People came out and said we were trying to violate civil rights,” he said.

The Community Leadership Alliance is active in the Tenderloin, SoMa, and the mid-Market Street area, and the group occasionally holds monthly meetings at the Infusion Lounge, an upscale nightclub owned by Scott Caroen, the chair of the organization.

Gascón worked with deputy city attorneys to draft the ordinance and all district police stations have submitted to their commanders a list of areas that they feel could benefit from the law, according to a Tenderloin district newsletter. Mirkarimi told the Guardian that some supervisors were kept in the dark for weeks about the fact that an ordinance had been drafted. “This wasn’t collaborative at all,” Mirkarimi told us. “We never received it until we demanded to see it.”

The Haight-Ashbury, where residents and visitors have been complaining about harassment from wayward traveling youth, has been ground zero for discussion about a sit/lie ordinance. A small group of irate residents there and the Park Station Capt. Teresa Barrett have rallied in support of the law, saying it would give police a new tool to target these disruptive street kids.

But it’s clear that the ordinance’s supporters want to see it applied broadly and to be used to roust the homeless in neighborhoods throughout the city.

“CLA feels that our sidewalks should be enjoyable and a place of social gathering, and that the ordinance could go a long way in helping our neighborhoods feel safer,” reads the Community Leadership Alliance alert that was included in the police captain’s newsletter. “It may also reduce the overall homeless population in San Francisco by discouraging people from coming to the city to beg for money.”

Back to the mat for Ting and the Catholics

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By Ryan Thomas Riddle

What city officials called the “second largest transfer tax event in our city’s history” is set to go back before the Transfer Tax Review Board. The Catholic Archdiocese of San Francisco has filed an appeal, contesting the delinquent tax value of the board’s Dec 4. ruling that states an estimated $14.4 million in transfer taxes are owed to the city.

Last month, the board ruled 3-0 in favor of Assessor-Recorder Phil Ting’s assertion that the church has to pay transfer taxes for its extensive 2008 property shuffle. Ting told the Guardian that particular decision isn’t what’s being challenged here. While the church has threatened to challenge the basic ruling in court, it is also contesting the exact value of the delinquent transfer taxes owed, he said.

In fact, Ting went before the Board of Supervisors on Tuesday, Jan. 26, to begin lien proceedings against the Archdiocese for the money owed. However, the church’s recent appeal has tabled that for now.

Marijuana goes mainstream

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Marijuana goes mainstream

I’ve smoked marijuana on and off for most of my adult life, usually in the evening to help let go of the anxieties associated with being a progressive wage slave in an increasingly conservative capitalist country.

Buying my pot, which is California’s biggest cash crop, has always been a criminal transaction: in hushed tones or coded language, I arrange to meet a dealer I’ve been set up with through friends. And when I meet him (they’ve always been men), I give him cash in exchange for an eighth- or quarter-ounce of whatever kind of pot he’s selling.

I don’t know what variety I’m buying, who grew it, or how it was grown; whether violence or environmental degradation have occurred along the supply chain; or even whether it is an indica or sativa, the two most basic cannabis families that have differing effects on users.

I’ve been completely in the dark, both in terms of what I was buying and who was benefiting from the transaction, but that changed recently. I obtained a doctor’s recommendation to legally smoke weed — honestly citing anxiety as my affliction — and set out to explore the area’s best cannabis clubs.

It was a little strange and disorienting at first, this new world of expert purveyors of the finest Northern California marijuana and the various concentrates, edibles, drinkables, and other products it goes into. But what eventually struck me is just now normal and mainstream this industry has become, particularly in San Francisco, which has long led the movement to legalize marijuana.

Unlike in cities such as Los Angeles, where the rapid proliferation of unregulated pot clubs has made headlines and raised community concerns, San Francisco years ago made its clubs jump through various bureaucratic hoops to become fully licensed, permitted, and regulated, free to join the mainstream business community, pay their taxes, and compete with one another on the basis of quality, price, customer service, ambiance, and support for the community.

As Californians prepare to decide whether to decriminalize marijuana for even recreational use — on Jan. 28, advocates plan to turn in enough valid signatures to place that initiative on the fall ballot — it’s a good time to explore just what the world of legal weed looks like.

Pretty much everyone involved agrees that San Francisco’s system for distributing marijuana to those with a doctor’s recommendation for it is working well: the patients, growers, dispensary operators, doctors, politicians, police, and regulators with the planning and public health departments.

“It works and it should continue to be replicated,” Sup. Ross Mirkarimi, who created the legislation four years ago that led to the current system, told us. “It’s now mainstream.”

Public health officials agree. “In general, we’re very happy about our relationship with the industry and their commitment to the regulations,” said Dr. Rajiv Bhatia, San Francisco’s environmental health director. “We did this well and we did it cooperatively with the clubs.”

Bhatia said there are now 22 fully-permitted clubs (and two more under review) in San Francisco, less than half the number operating when the regulations were created. He also said the city no longer receives many complaints from neighbors of clubs.

Misha Breyburg, managing partner of the nonprofit Medithrive, which opened just a few months ago on Mission Street, supports the process too. “The regulations generally are not easy, but I think that’s okay,” he said. “The process was long and cumbersome and stressful, but very fair.”

Martin Olive, director of the Vapor Room, one of the city’s largest and best dispensaries, agrees that the permitting process professionalized the industry: “I’m proud to be here because the city government has been amazing.”

Richard Lee — founder of Oaksterdam University in Oakland, which teaches marijuana cultivation and is the main financial backer behind the initiative to legalize and tax pot — said San Francisco and Oakland have demonstrated that cannabis clubs can function like any other legitimate industry and become a real asset to their neighborhoods and the local economy.

“Once they started legalizing the clubs, they had no more problems,” Lee told us. “It really is boring and really not a big deal. It’s only the prohibition that makes it exciting and a little scary.”

In fact, Lee said that normalizing and legalizing the marijuana industry is the best way to deal with the problems associated with the illegal drug trade, such as violence, creation of a criminal class, respect for law enforcement, wasted public resources, lost tax opportunities, unsafe growing operations, and environmental damage.

“We need to end cannabis prohibition to end the violence,” Lee said.

Bringing marijuana above ground also has created an artisanship that’s similar to the wine industry, elevating cultivation practices to an art form, improving the science behind it, and making users more sophisticated about subtle differences in taste and effect among the dozens of varieties now on the market.

But the growers themselves still exist in a murky gray area. Although they can get some legal cover as registered caregivers to a cooperative’s members, they’re still exposed to thefts, shakedowns, logistical difficulties, and raids by federal agents or even local police, such as the series of raids in the Sunset District last fall that targeted even legitimate growers for the clubs.

“Right now, cultivators have no air cover at all and they’re getting mixed messages,” Mirkarimi said, calling for the city to better protect growers and even consider getting into the business of growing pot for the clubs and patients. “General Hospital should dispense medical cannabis.”

That issue and others related to the city’s relationship with the industry are currently the subject of a working group convened by Sup. David Campos, a byproduct of which is the proposal to create a Medical Cannabis Task Force to advise the Board of Supervisors, an item the board was scheduled to vote on Jan. 26.

Mirkarimi said he’s also concerned about current rules that ban smoking in clubs that are within 1,000 feet of schools or drug treatment facilities, which has served to prohibit smoking in all but a few San Francisco clubs. Oakland bans smoking in all its clubs. “That’s where the laws could be modified, because you don’t want to take away that social vibe,” Mirkarimi said. “San Francisco needs to be a leader in activating the next step.”

Olive, whose club allows smoking and has a great social scene, agrees that something is lost when the clubs are forced to be simply transactional.

“This is a social healing medicine, and we’re here to promote an inviting atmosphere where people can share their stories,” Olive said. “The whole point is not to just come in and get your medicine, but to be a part of a community.”

That community can range from young stoners to dying old patients, who can both benefit from their communion. “It’s the hippies and the yuppies. Everyone comes here,” Breyburg said. Or as Olive told me, “There is something intrinsically rewarding to sharing a joint with someone, as silly as that sounds.”

The voter-approved Proposition 215 and state law are deliberately vague on what ailments qualify for a doctor’s recommendation, spawning a sub-industry of physicians who specialize in pot, like the ones at the clinic I visited, Dr. Hanya Barth’s Compassionate Health Options in SoMa.

The busy clinic charges around $130 for an initial visit and patients walk away with a legal recommendation, which is all state law requires to legally use marijuana (the clinic recommended also buying a $100 state ID card or a $40 card from the Patient ID Center in Oakland, but I didn’t need them to enter any of the clubs I visited).

The long forms patients fill out even suggest anxiety as an affliction that pot can help, but the clinic also asks patients to sign a waiver to obtain detailed medical records supporting the recommendation. When Barth learned that I have a shoulder separation for which I underwent an MRI a few years ago, she requested those records and added “shoulder pain” to my “anxiety” affliction.

“My goal is not just to give people a recommendation. I look at how I can help or support the person beyond just giving them a recommendation,” Barth told me, illustrating her point by showing me two packs of cigarettes from patients whom she said she convinced to quit smoking.

Her vibe combines the healer and the old hippie, someone who sees a plethora of uses for marijuana and generally thinks society would be better off if everyone would just have a puff and chill out. The clubs also don’t draw distinctions based on their customers’ reasons for smoking.

“There is a distinct difference between medical use and recreational use,” Olive said, telling stories about amazing turnarounds he’s seen in patients with AIDS, cancer, and other debilitating diseases, contrasting that with people who just like to get high before watching a funny movie, which he said is also fine.

But Olive said there’s an important and often under-appreciated third category of marijuana use: therapeutic. “They use cannabis to cope, to unwind, to relax, to sleep better, or to think through problems in a different way,” Olive said.

This third category of user, which I officially fall into, seems to be the majority people I encountered in the local clubs. And while it may be easy for cannabis’ critics to dismiss such patients as taking advantage of laws and a system meant to help sick people, Olive says they play an important role.

“They make it easier for the cannabis clubs to give it away to the people who really need it,” Olive said, referring the practice by most clubs of giving away free weed to low-income or very sick patients, which is supported by the profits made on sales.

The Vapor Room is widely regarded as having one of the best compassionate giving programs, and Olive estimated that the operation gives away about a pound per week through local hospice programs and by giving away edibles and bags of cannabis vapor at the club.

Some of the profits are also used to offer free massage, yoga, chiropractic, and other classes to their members, a system being taken to new heights by Harborside Health Center in Oakland, which has fairly high prices but uses that revenue to offer an extensive list of free services and laboratory analysis of the pot it sells, identifying both contaminants (such as molds or pesticides) and the level of THC, the compound that gets you high.

Olive said there’s also a positive psychological impact of legitimizing the use of marijuana: “It no longer feels like you’re doing a bad thing that you have to be sneaky about.”

As I created my list of the clubs I planned to review, I found abundant online resources such as www.sanfranciscocannabisclubs.com and www.weedtracker.com. But an even better indicator of how mainstream this industry has become were the extensive listings and reviews on Yelp.com.

I combined that information with recommendations from a variety of sources I interviewed to develop my list, which is incomplete and entirely subjective, but nonetheless a good overview of the local industry and the differences among the clubs.

Also, like our restaurant reviewers, I didn’t identify myself as a journalist on my visits, preferring to see how the average customer is treated — and frankly, I was amazed at the high level of friendly, knowledgeable customer service at just about every club. To comply with city law, all the clubs are fully accessible by those with disabilities.

So, with that business out of the way, please join me on my tour of local cannabis clubs, in the (random) order that I visited them:

————

DIVINITY TREE

While the reviews on Yelp rave about Divinity Tree (958 Geary St.), giving it five stars, I found it a little intimidating and transactional (although it was the first club I visited, so that might be a factor). But if you’re looking to just do your business in a no-frills environment and get out, this could be your place.

The staff and most of the clientele were young men, some a bit thuggish. One worker wore a “Stop Snitching” T-shirt and another had “Free the SF8.” But they behaved professionally and were knowledgeable and easy to talk to. When I asked for a strain that would ease my anxiety but still allow me enough focus to write, my guy (patients wait along a bench until called to the counter) seemed to thoughtfully ponder the question for a moment, then said I wanted a “sativa-dominant hybrid” and recommended Neville’s Haze.

I bought 1/16 for $25 and when I asked for a receipt, it seemed as though they don’t get that question very often. But without missing a beat he said, “Sure, I’ll give you a receipt,” and gave me a hand-written one for “Meds.”

Buds weighed on purchase

Open for: three years

Price: Fairly low

Selection: Moderate

Ambiance: A transactional hole in the wall

Smoke On Site: No

Thug factor: Moderate

Access/Security: Easy. Membership available but not required

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GRASS ROOTS

Located at 1077 Post St. right next to Fire Station #3, Grass Roots has the feel of a busy saloon. Indeed, as a worker named Justin told me, many of the employees are former bartenders who know and value customer service. With music, great lighting, and nice décor, this place feels comfortable and totally legit. Whereas most clubs are cash-only, Grass Roots allows credit card transactions and has an ATM on site.

The steady stream of customers are asked to wait along the back wall, perusing the menus (one for buds and another with pictures for a huge selection of edibles) until called to the bar. When asked, my guy gave me a knowledgeable breakdown of the difference between sativa and indica, but then Justin came over to relieve him for a lunch break with the BBQ they had ordered in and ate in the back.

Justin answered my writing-while-high inquiry by recommending Blue Dream ($17 for a 1.2-gram), and when I asked about edibles, he said he really likes the indica instant hot chocolate ($6), advising me to use milk rather than water because it bonds better with the cannabinoids to improve the high. Then he gave me a free pot brownie because I was a new customer. I was tempted to tip him, but we just said a warm goodbye instead.

Buds weighed on purchase

Open for: five years

Price: Moderate

Selection: High

Ambiance: A warm and welcoming weed bar

Smoke On Site: No

Thug factor: Low

Access/Security: Easy

————–

HOPENET

Hopenet (223 Ninth St.) is one of the few places in the city where you can smoke on site, in a comfortable, homey style, as if you’re visiting a friend’s apartment. In addition to the loveseat, two chairs, and large bong, there is a small patio area for smoking cigarettes or playing a guitar, as someone was doing during my visit.

Although the small staff is definitely knowledgeable, they all seemed stoned. And when I asked about the right weed for my writing problem, a gruff older woman impatiently dismissed any indica vs. sativa distinctions and walked away. But I learned a lot about how they made the wide variety of concentrates from the young, slow-talking guy who remained.

He weighed out a heavy gram of White Grapes for $15, the same price for Blue Dream, and $2 cheaper than I had just paid at Grass Roots. That was in the back room, the big middle area was for hanging out, and the front area was check-in and retail, with a case for pipes and wide variety of stoner T-shirts on the walls.

Buds weighed on purchase

Open for: seven years

Price: Low

Selection: Moderate

Ambiance: Like a converted home with retail up front

Smoke On Site: Yes!

Thug factor: Low

Access/Security: Easy

————

VAPOR ROOM

Vapor Room (607A Haight, www.vaporroom.com) is San Francisco’s best pot club, at least in terms of feeling like an actual club and having strong connections to its community of patients. It’s a large room where customers can smoke on site, giving this collective a warm, communal vibe that facilitates social interaction and fosters a real sense of inclusiveness.

Each of the four large tables has a high-end Volcano vaporizer on it, there’s a big-screen TV, elegant décor, and large aquarium. There’s a nice mix of young heads and older patients, the latter seeming to know each other well. But, lest members feel a little too at home, a sign on the wall indicates a two-hour time limit for hanging out.

Its early days in the spot next door were a bit grungier, but the new place is bright and elegant. It has a low-key façade and professional feel, and it strongly caters to patients’ needs. Low-income patients are regularly offered free medicine, such as bags full of vapor prepared by staff. Mirkarimi said the Vapor Room is very involved in the Lower Haight community and called it a “model club.”

But they’re still all about the weed, and they have a huge selection that you can easily examine (with a handy magnifying glass) and smell, knowledgeable staff, lots of edibles and concentrates, a tea bar (medicated and regular), and fairly low standardized pot prices: $15 per gram, $25 per 1/16th, $50 per eighth. And once you got your stuff, grab a bong off the shelf and settle into a table — but don’t forget to give them your card at the front desk to check out a bowl for your bong. As the guy told me, “It’s like a library.”

Buds weighed on purchase

Open for: six years

Price: Moderate

Selection: High

Ambiance: Warm, communal hangout

Smoke On Site: Yes!

Thug factor: Low

Access/Security: Easy, but membership required

————-

MEDITHRIVE

The newest cannabis club in town, MediThrive (1933 Mission, www.medithrive.com) has a bright, fresh, artsy feel to it, with elegantly frosted windows and a welcoming reception area as you enter. This nonprofit coop takes your photo and requires free membership, and already had almost 3,000 members when I signed up a couple weeks ago. Tiana, the good-looking young receptionist, said the club recently won a reader’s choice Cannabis Cup award and noted that all the art on the walls was a rotating collection by local patients: “We’re all about supporting local art.”

The decorators seemed to have fun with the cannabis concept, with a frosted window with a pot leaf photo separating the reception area from the main room, while the walls alternated wood planks with bright green fake moss that looked like the whole place was bursting with marijuana. There’s a flat-screen TV on the wall, at low volume.

The large staff is very friendly and seemed fairly knowledgeable, and the huge selection of pot strains were arranged on a spectrum with the heaviest indica varieties on the left to the pure sativas on the right. Lots of edibles and drinkables, too. The cheapest bud was a cool steel tin with a gram of Mission Kush for $14 (new members get a free sample), while the high rollers could buy some super-concentrated OG Kush Gold Dust ($50) or Ear Wax ($45) to sprinkle over their bowls.

Prepackaged buds

Open for: three months

Price: Moderate

Selection: High

Ambiance: Professional, like an artsy doctor’s office

Smoke On Site: No

Thug factor: Very low

Access/Security: Easy, but membership required

————

KETAMA COLLECTIVE

At 14 Valencia St., Ketama is a testament to how silly it is that clubs within 1,000 feet of schools aren’t permitted to allow smoking on site. This former café has a large, comfortable seating area and full kitchen, both of which have had little use since a school opened way down the street last year, causing city officials to ban smoking at Ketama.

Pity, because it seems like a great place to just hang out. Yet now it just seemed underutilized and slow. The staff is small (one door guy and a woman hired last summer doing sales), and we were the only customers during the 20 minutes I was there (except for the weird old guy drinking beer from a can in a bag who kept popping in and out).

But it still had jars of good green bud, several flavors of weed-laced drinks and edibles, and a pretty good selection of hash and kief at different prices, and the woman spoke knowledgeably about the different processes by which they were created. To counteract the slow business, Ketama has a neon sign out front that explicitly announces its business — another indication the industry has gone legit.

Buds weighed on purchase

Open for: five years

Price: Low

Selection: Limited

Ambiance: Dirty hippie hangout, but with nobody there

Smoke On Site: No

Thug factor: Low

Access/Security: Easy, but free membership required

————

MR. NICE GUY

Belying its name, Mr. Nice Guy (174 Valencia St.) thrilled and scared me, but not necessarily in a bad way. Located across the street from Zeitgeist, the thug factor here was high and so was the security, allowing no human interaction that wasn’t mediated by thick Plexiglass, presumably bulletproof.

After initially being told by a disembodied voice to come back in five minutes, I submitted my doctor’s recommendation and ID into the slot of a teller’s window, darkened to hide whoever I was dealing with. Quickly approved, I was buzzed into a small, strange room with three doors.

I paused, confused, until the disembodied voice again told me, “Keep going,” and I was buzzed through another door into a hallway that led to a large room, its walls completely covered in brilliant murals, expertly painted in hip-hop style. Along the front walls, a lighted menu broke down the prices of about 20 cannabis varieties.

Then finally, I saw people: two impossibly hot, young female employees, lounging nonchalantly in their weed box, like strippers waiting to start their routines. The only other customer, a young B-boy, chatted them up though the glass, seemingly more interested in these striking women than their products.

I finally decided to go with the special, an ounce of Fever, normally $17, for just $10. I opened a small door in the glass, set down my cash, and watched the tall, milk chocolate-skinned beauty trade my money for Fever, leaving me feeling flushed. It was the best dime-bag I ever bought.

Prepackaged buds

Open for: ???

Price: Moderate, with cheap specials

Selection: High

Ambiance: Hip hop strip club

Smoke On Site: No

Thug factor: High

Access/Security: High security but low scrutiny

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BERNAL HEIGHTS COLLECTIVE

Bernal Collective (33 29th St. at Mission) seemed both more casual and more strict than any of the other clubs in town — and it also turned out to be one of my favorites.

After refusing to buy pot for a guy out front who had just been turned away, I entered the club and faced more scrutiny than I had at any other club. It was the only club to ask for my doctor’s license number and my referral number, and when I tried to check an incoming text message, I was told cell phone use wasn’t allowed for “security reasons.” On the wall, they had a blown-up copy of their 2007 legal notice announcing their opening.

But beyond this by-the-book façade, this club proved warm and welcoming, like a comfortable clubhouse. People can smoke on site, and there’s even a daily happy hour from 4:20–5:20 p.m., with $1 off joints and edibles, both in abundant supply. Normal-sized prerolled joints are $5, but they also offer a massive bomber joint with a full eighth of weed for $50.

The staff of a half-dozen young men were knowledgeable about the 20 varieties they had on hand and offered excellent customer service, even washing down the bong with an alcohol-wipe before letting a customer take a rip from the XXX, a strong, sticky bud that was just $15 for a gram.

Buds weighed at purchase

Open for: five years

Price: Fairly low

Selection: High

Ambiance: A clubhouse for young stoners

Smoke On Site: Yes

Thug factor: Low

Access/Security: Fairly tight

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LOVE SHACK

This longtime club (502 14th St.) has had its ups and downs, the downs coming mostly because of its location on a fairly residential block. After taking complaints from neighbors, the city required Love Shack to cap its membership, although that seems to be changing because the club let me in, albeit with a warning that next time I would need to have a state ID card. It was the only club I visited to have such a requirement.

Once inside this tiny club, I could see why people might have been backed up onto the street at times. But the staff was friendly and seemed to have a great rapport with the regulars, who seemed be everyone except me. The knowledgeable manager walked me through their 20-plus varieties, most costing the standard street price of $50 per eighth, or more for stronger stuff like Romulan.

On the more affordable end of the spectrum was the $10 special for Jack Herrer Hash, named for the longtime legalization advocate who wrote The Emperor Wears No Clothes, a classic book on the history of the movement.

Buds weighed at purchase

Open for: eight years

Price: Moderate

Selection: High

Ambiance: Small, like a converted apartment

Smoke On Site: No

Thug factor: Moderate

Access/Security: Tight

————-

COFFEE SHOP BLUE SKY

Blue Sky (377 17th St., Oakland)is based on the Amsterdam model of combining marijuana dispensaries with coffee shops, although it suffers a bit from Oakland’s ban on smoking. Still, it’s a cool concept and one that Richard Lee sees as the future of marijuana-related businesses because of the synergy between smoking and grabbing a bite or some coffee.

Most of Blue Sky is a small coffee shop and smoothie bar, but there’s a little room in back for buying weed. “We’ve got the best prices around,” said the guy who checked my ID, and indeed, $44 eighths and $10 “puppy bags” were pretty cheap. Customers can also sign up to do volunteer political advocacy work for free weed.

The only downside is the limited selection, only four varieties when I was there, although the woman at the counter said the varieties rotate over the course of the day based on the club’s purchases from growers.

Prepackaged buds

Open for: 14 years

Price: Low

Selection: Very limited

Ambiance: A fragrant little room behind a coffee shop

Smoke On Site: No

Thug factor: Low

Access/Security: Easy

————–

HARBORSIDE HEALTH CENTER

I have seen the future of legitimized medical marijuana businesses, and it’s Harborside (1840 Embarcadero, Oakland). With its motto of “Out of the shadows, into the light,” this place is like the Costco of pot — a huge, airy facility with a dizzying number of selections and even a “rewards card” program.

All new members are given a tour, starting with sign-up sheets for daily free services that include yoga, chiropractic, acupuncture, reiki, consultations with herbalists, and classes on growing. Then we moved to a section with the clones of dozens of pot plant varieties available for purchase (limit of 72 plants per visit), along with a potted marijuana plant the size of a tree.

Harborside is also blazing the trail on laboratory services, testing all of its pot for contaminants and THC content, labeling it on the packaging just like the alcohol industry does. Some of the smaller clubs don’t like how over-the-top Harborside is, and they complain that its prices are high. But those profits seem to be poured back into the services at this unique facility.

Prepackaged buds

Open for: three years

Price: High

Selection: Huge

Ambiance: A big, open shopping emporium

Smoke On Site: No

Thug factor: Low

Access/Security: Tight

————-

SANCTUARY

The people who run Sanctuary (669 O’Farrell St.), the first club to fully comply with the new city regulations and get its permanent license, have been active in the political push for normalizing medical marijuana, as a wall full of awards and letters from politicians attests. Owner Michael Welch was commended for his work by the Harvey Milk LGBT Democratic Club, where Sanctuary employee Tim Durning has been an active longtime member and former elected officer.

Sanctuary has a generous compassionate giving program and caters to lots of poor residents of the Tenderloin neighborhood. While the club is prohibited from allowing smoking, they fudge the restriction with a Volcano vaporizer. “A lot of patients are on fixed income and live in the SROs, where they can’t smoke, so we let them vaporize here whether they buy from us or not,” Durning told us.

Those who do buy from them find a huge selection — including 20 different kinds of hash and 17 varieties of buds — at a wide price range. Staffers know their products well and take their business seriously, giving a regular spiel to new members about responsible use, which includes maintaining neighborhood relations by not smoking near the business.

Buds weighed on purchase

Open for: five years

Price: Low to moderate

Selection: High

Ambiance: Campaign headquarters for the marijuana movement

Smoke On Site: No, but vaporizing OK

Thug factor: Low

Access/Security: Easy

————–

GREEN DOOR

If low prices or a huge selection of edibles are what you seek, Green Door (843 Howard St., www.greendoorsf.com) could be the club for you.

Eighths of good green buds start at a ridiculously low $25 and go up to just $50 (the cheapest price for eighths at many clubs and also the standard black market price). If that’s not low enough, super-broke users can buy a quarter-ounce bag of high-grade shake for $40.

If you didn’t already have the munchies going in, you’ll get them perusing the huge menu of edibles: from weed-laced knockoffs of Snickers bars and Reese’s Peanut Butter Cups for just $5 to cupcakes, ice cream, or Chex party mix. They have lots of hash and other concentrates as well.

Somehow, the club also manages to have a strong compassionate giving program and contibutes to local civic organizations that include the Black Rock Arts Foundation, Maitri AIDS Hospice, and Friends of the Urban Forest.

The club itself is a little sterile and transactional, with an institutional feel and employees stuck behind teller windows. But even though that and the steady flow of tough-looking young male customers raise its thug factor a bit, the employees all seemed friendly and helpful, giving free edibles to first-time customers.

Prepackage buds

Open for: 8 years (4 here, 4 in Oakland)

Price: Cheap

Selection: High for edibles, moderate for weed

Ambiance: Like a community bank of cheap weed

Smoke On Site: No

Thug factor: Moderate

Access/Security: Easy access, high security

————–

RE-LEAF HERBAL CENTER

While I had heard good things about Re-Leaf (1284 Mission St.), my first impression was that it’s a little sketchy. As the door guy was checking my recommendation card and ID, I asked whether they allow smoking on site. He looked as if this was a difficult question, paused, and finally told me to ask the people behind the counter.

The small club was blaring gangsta rap when I entered, after a while lowering the volume to compete less with the blaring television set to an ultimate fighting match. It had two small fridges filled with tasty-looking edibles and lots of vaporizers and other merchandise for sale, but only eight varieties of marijuana.

But the service was good, and after knocking $5 off my gram of Jim Jones (a variety I only found here) because I was a first-time customer, he told me it was OK to smoke on site. I sat down on the couch, but there were no bongs, vaporizers, pipes, or even ashtrays to use.

Buds weighed on purchase

Open for: two years (three years at previous SF location)

Price: Fairly low

Selection: Limited

Ambiance: A loud head shop that also has some weed

Smoke On Site: Yes and no

Thug factor: Moderate to high

Access/Security: Easy

Scraping bottom

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Scraping bottom

The job of scrubbing down a city bus after it’s gone out of service is no picnic. At a Jan. 20 Budget and Finance Committee hearing called by Sup. Chris Daly to discuss health and safety impacts related to Municipal Transportation Agency layoffs, supervisors took a virtual tour of a Muni bus that was trashed on multiple levels: tagged inside and out, soiled with vomit, and strewn with garbage. Among the roughly 100 Muni workers who will lose their jobs to midyear budget cuts are 10 “car cleaners” — those unsung heroes who scrub away late into the night, tackling the residue left behind by the Sharpie-wielding, litterbug masses.

“We do send out all of our vehicles clean,” MTA spokesperson Judson True told the Budget and Finance Committee members at the hearing. “We do not send out any of our vehicles with any health issues … and we will not.” Despite his assurances, members of the Board of Supervisors and some Muni staffers voiced fears that with fewer and more overworked car cleaners, the overall experience of riding public transit could suffer.

It’s just one small example of on-the-ground impacts of painful budget cuts inflicted to solve a steep shortfall affecting the city’s transit agency. The fiscal woes aren’t unique to Muni. In coming months, San Francisco city departments across the board will have to contend with revenue shortfalls and find ways to continue providing services with diminished resources.

But with layoffs and other proposals such as raising fares, reducing service, and charging more for discount passes on the table, many are raising objections — including several members of the MTA Board of Directors, a body that is wholly appointed by Mayor Gavin Newsom. In a rare show of defiance at a Jan. 19 MTA Board meeting, several directors even resuscitated the idea of extending parking-meter hours and raising meter fees to generate new transit revenue, an idea Newsom previously rejected.

$49 MILLION IN THE RED

Muni has lost $180 million in state funding over the last three years due to “the nightmare in Sacramento,” as True put it, and no one seems to believe the fiscal crisis can be resolved without some degree of pain.

At the Jan. 19 MTA Board meeting, transit agency Chief Financial Officer Sonali Bose outlined the dismal financial picture, explaining that Muni has been hit hard by declining parking and taxi fees and impacts to the city’s general fund, leaving it about $49 million in the hole for the current budget cycle. After the layoffs, Muni will still face a $17 million problem. To solve it, suggestions include jacking up the historic F Line trolley fare from $3 to $5, charging $30 for discount monthly passes for seniors and passengers with disabilities, and reducing service.

Even against the gloomy fiscal backdrop, the prospect of eliminating jobs to make up for the losses drew serious concerns from MTA directors. “Once somebody’s gone, they’re gone,” Director Shirley Breyer Black noted. “I think moving forward with cuts in these classifications will send us into deeper fiscal crisis.”

All the affected workers — most of them frontline employees — are slated to lose their jobs by May 1, and around one-third of them were dismissed Jan. 22.

Muni Executive Director and CEO Nathaniel Ford emphasized that the decision to cut jobs was not made lightly. But at a Budget and Finance Committee meeting the following day, progressive members of the Board of Supervisors expressed alarm after hearing union members sound off about how the cuts disproportionately affect lower-paid classifications. The majority of layoffs target members of Service Employees International Union Local 1021, San Francisco’s largest labor union, which represents frontline workers across city departments.

“I understand that there are no good decisions,” Daly told the Guardian, adding that a certain group of workers seem to bearing the brunt of the cuts. “What progressive supervisors are calling for is for the budget to be handled more evenly,” he said.

A single Municipal Executives’ Association (MEA) employee — an MTA manager earning between $105,950 and $135,200 per year — was let go during this latest round of about 100 Muni layoffs, according to an agency memo. In the past year, MTA reduced its upper-level management team from 108 to 96 employees. In contrast, 33 members of SEIU Local 1021 — the majority frontline workers earning between $45,656 and $64,272 a year — will be affected by the cuts.

“Unfortunately, when MTA discovered that they had a budget problem, they didn’t bring all parties to the table,” SEIU Organizer Leah Berlanga testified at the Budget and Finance Committee hearing. “The way we got invited was via pink slips. That’s the only time they will talk to people who do direct services.”

When asked whether Muni had assessed mid- and upper-management level jobs to even the scales, True responded that a few mid-level managers were included in the latest round of cuts. One reason the layoffs seem disproportionate, he added, is that there are so many more frontline workers than others. “The budget picture has affected the entire agency,” he said. “No one is happy about these decisions.”

But SEIU Local 1021 characterized the layoffs as misguided, and attempted to identify waste and mismanagement within the agency in a packet of alternative cost-saving measures it submitted to MTA. At the top of the list was the suggestion that the agency eliminate 35 retired Muni employees, who are allowed to work up to 960 hours per year and earn wages in addition to their pensions. And according to the union, there are 21 temporary workers in the agency who’ve exceeded a two-year limit for short-term employment. SEIU recommended that those temps be dismissed too.

SEIU also criticized the decision to lay off 24 parking control officers (PCOs) — uniformed workers who have the unenviable job of issuing parking citations to bring in revenue for the city. “To me, if you do the simple math, it doesn’t make any sense. They make most of the money for the MTA,” said a PCO who testified at the hearing.

According to SEIU’s calculations, eliminating 24 employees who dole out parking tickets could result in a $7.2 million loss for the city in parking revenue. But True said MTA disagrees with this figure, and pointed to an internal memo showing how revenue from parking citations dropped in recent years even as more PCOs were hired. Nonetheless, at the urging of SEIU, the MTA Board agreed to postpone those 24 layoffs until February to buy time to study the impact. For other positions, negotiations between MTA and the union are ongoing. The details on still more layoffs, which will affect transit operators, is yet to come.

Sup. David Campos is asking for a management audit to see if Muni is spending its money efficiently. “I think we should look at best practices and how we’re operating before we finalize any cuts,” he said.

THE PARKING POLITICS

During a round of MTA budget talks last fall, the idea of extending city parking meter hours and raising meter fees was floated as a means of recouping losses — but Newsom balked at the idea, saying higher parking fees could harm small businesses. Now MTA Director Bruce Oka has revived — and endorsed — the concept.

“I can hold my nose and vote on anything, but I refuse to vote on something when I believe we have not looked under a rock for every source of funding,” Oka said at the meeting. “We have to extend the parking meter hours — we have to find dollars. If Room 200 [i.e. Newsom] doesn’t want that to happen, well then … he’s got to come up with a way to do what we need to do. If he’s not going to raise parking meters or extend parking meter time, he’s got to come up with some money.”

Tom Radulovich, executive director of nonprofit Livable City and one of the individuals who helped to create MTA in 1999, summed up Oka’s comments with a note of surprise: “He really called out the mayor,” he said. “I haven’t seen MTA Board members do that — they usually cover for him.”

Radulovich — who is also on the BART Board — says targeting motorists for more revenue instead of transit riders would be more equitable, sustainable, and in keeping with the city’s Transit First goals in the long run. Proposition A, passed November 2007, established “a strong mandate to reduce transportation-related greenhouse gas emissions,” he pointed out. But, he noted, with layoffs that could affect the qualify of service and possibly deter people from riding, “We don’t see how MTA is going to get to those voter-mandated transit goals.” *

MUNI MEETINGS

PUBLIC MEETINGS ON SFMTA BUDGET

Saturday, Feb. 6, 10 a.m. to noon

Tuesday, Feb. 9, 6 p.m. to 8 p.m.

Saturday, Feb. 20, 10 a.m. to noon

One South Van Ness Ave. at Market Street, 2nd Floor Atrium

SFMTA BOARD MEETINGS

Friday, Jan. 29, 10 a.m.; discussion of FY10 options, including Muni service reductions

Tuesday, Feb. 16, 11 a.m.; public hearing on proposed FY10 budget actions

Tuesday, Mar. 2, 2 p.m.; public hearing and possible board approval of FY10 budget actions

Location: City Hall, 1 Dr. Carlton B. Goodlett Place, Room 400

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