Government

Another privatization success story

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The stock market took another tumble today on the work that Fannie Mae and Freddie Mac, which guarantee a large percentage of the mortagages in the United States, are in crisis and may be nearing collapse. Word is that the Bush Administration may have to step in with a bailout plan that could compare with the massive S&L bailout of the early 1990s.

Why are the two giant corporations, without which the entire housing market could collapse, in so much trouble? Dave Iverson discussed that on forum this morning, and some interesting points came out. According to his guest, Thomas Davidoff, a business-school professor at Berkeley, Fannie Mae and Freddie Mac were doing what short-term profit-seeking companies do — investing in instruments that do well when the economy is doing well, particularly, and ironically, in mortage-backed securities. Now that the housing markets are tanking, and those securities have fallen in value, and the two companies are facing huge liabilities for the mortgages they guaranteed, the taxpayers are going to have to step in.

But here’s what a lot of people forget: Fannie Mae, the Federal National Mortgage Association, was originally a government agency, created by Roosevelt as part of the New Deal. In 1968, it was privatized. Freddie Mac, the Federal Home Loan Mortgage Corporation, was never a public entity, but was created to provide competition in the market when Fannie Mae was privatized. (By the way, these are the outfits that have made the securitization of morgtages possible.)

But of course, both have operated with what finance experts call an “implicit guarantee” of federal backing. Everyone assumes that if they screw up, Uncle Sam will come to the rescue.

So we have the worst of both worlds: A private outfit making bad investment decisions because there’s no real downside fear — and the taxpayers, who have little control over it, having to foot the bill.

Privatization has done such wonders for the mortgage-finance market, eh? Perhaps President Obama and Speaker Pelosi will have enough sense to stop bailing these companies out and turn them back into government agencies.

High speed rail moves forward

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The California High Speed Rail Authority, during a meeting this morning in San Francisco, voted unanimously to set the Bay Area route through the Pacheco Pass and up the peninsula into the Transbay Terminal and to approve the related environmental documents. The action ends a three-year controversy over whether to bring the proposed high-speed rail line over Pacheco Pass, a cheaper and easier option favored by most Bay Area politicians and government agencies, or over the Altamont Pass, an option favored by groups such as the Planning and Conservation League and California Rail Foundation, which are threatening a lawsuit over today’s decision. The CHSRA board also voted unanimously today to pursue creation of a separate, regional rail line over Altamont that would connect into the high speed rail system.
Meanwhile, there are battles in Sacramento over Assembly Bill 3034, which would update the language and financial oversight provisions of Proposition 1, the $10 billion high speed rail bond measure on the November ballot, replacing current language that was written six years ago when the measure was first approved for the ballot before it was repeatedly pushed back by the Legislature. That bill, which needs a two-thirds vote of both legislative houses, is being heard tomorrow by the Senate Appropriations Committee.
Once built, the high speed trains would travel at up to 220 mph and make the trip from San Francisco to Los Angeles Union Station in about two and a half hours, mostly likely running entirely on renewable energy sources without the huge greenhouse gas output from either driving or flying. For a lengthy discussion of the project, its complicated politics, today’s vote, and the dramas surrounding AB 3034 and Senator Leland Yee, read next week’s Guardian.

Man with a plan

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› news@sfbg.com

GREEN CITY Environmental groups have voiced cautious optimism about the California Air Resources Board’s new draft plan for fulfilling the legislative mandate of reducing greenhouse gas emissions by 30 percent from 1990 levels by 2020 and 80 percent by 2050. It relies primarily on greater conservation and efficiency, and a push for new technology.

But skeptics await the forthcoming details behind the plan’s vague outlines and openly worry that the complex "cap and trade" system for selling the right to pollute, an approach favored by industry executives, could be counterproductive. Many experts say we need a more radical reevaluation of the current system, such as that proposed by California’s S. David Freeman in his book, Winning Our Energy Independence: An Energy Insider Shows How (Gibbs Smith, 2007).

Freeman has advised presidents and governors on energy policy, run the Tennessee Valley Authority and major municipal utility districts, and recently activated a fleet of all-electric vehicles as head of the commission overseeing the Port of Los Angeles.

His book lays out a plan to phase out Big Coal, Big Oil, and nuclear (which he dubs "the Three Poisons") over 30 years while meeting the needs of our high-energy society by implementing renewable technologies that already exist: sun, wind, and renewably generated hydrogen, supplemented by small hydroelectric, geothermal, and certain biofuels.

"[I]t is entirely practical and feasible to get all our energy from renewable resources and to do so with today’s technology," Freeman writes, contradicting energy industry spin that beginning the switch would take decades. Footnoted calculations and renewable resource maps show that renewables will cost the public less, with supply "over twice as large as what we may need," if used efficiently.

The transition he proposes could eliminate many of the physical, economic, and political risks of our current unsustainable oil addiction, but only if environmentally concerned Americans — which, he posits, are a majority — close ranks and demand a national renewable energy policy that started immediately.

Freeman’s plan also relies heavily on conservation: it recommends federal government-mandated efficiency programs for utilities, auto companies, manufacturers of energy-using equipment, and homebuilders to offset rising consumer demand. Increasing fuel mileage standards by 1 mpg per year for 24 years (to 48 mpg), for example, would push automakers to steadily improve their products.

His second step: retire aging, highly polluting coal and waste-generating nuclear plants, outlaw new ones, and phase in renewable power-generating alternatives using sun, wind, geothermal, biomass, and municipal waste (going from 9 percent renewable now to 60 percent in three decades, at five-year intervals). Forest, agricultural, and municipal waste are preferable to food-based ethanol.

Freeman encourages consumers to get vocal with manufacturers and demand flex-fuel and plug-in hybrid cars (with batteries you can recharge at home) and, ultimately, all-electric cars. Rechargeable types require less gasoline, freeing us from reliance on foreign oil, a militaristic foreign policy, and habitat destruction at home. An excess-profits tax can supply consumer and manufacturer incentives to speed production within a decade.

Because green cars mean more demand for electricity, Freeman looks beyond new thin-film solar rooftop panels, calling on the federal government to develop "Big Solar": desert installations capable of generating 500 MW of power (the largest US solar farm now generates 16). Such a facility could fuel the energy-intensive electrolysis process needed to free clean-burning hydrogen from water (to replace gasoline), which can then be piped and stored.

Sure, this kind of approach will be expensive. But it would be attainable when looked at against the high cost of oil wars and steadily rising gas prices; habitat and health benefits further tip the scales.

To supplement lulls in sun and wind, the "cleanest of the fossil fuels — natural gas plants — should be allowed to continue to generate power … to assure reliability during hours when the renewables are not available," Freeman writes.

Freeman incites a people-power surge to usher in the big transition: "A favorite trick of the energy establishment is to say our problems are so big that we have to try everything, which means drilling where oil companies want to drill, strip mining coal, and building prohibitively costly, high-risk, toxic nuclear reactors.

Freeman said we need that same strong commitment to transition away from the Three Poisons, because "coal, oil, and nuclear cause the problems while renewables are the solution."

Bucking off Chuck

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› amanda@sfbg.com

It was a steamy 95 degrees inside the vineyard, just east of Stockton, where Maria Isabel Vasquez Jimenez was pruning a shadeless stretch of young vines. It was May 14, the third day of work for the 17-year-old immigrant from Oaxaca, Mexico. She’d been working more than nine hours, with just one water break, when she collapsed from heat exhaustion at 3:40 p.m.

An hour and a half later, when she finally arrived at an emergency room, her body temperature was 108.4 degrees. For two days her heart stopped and started, then ceased beating completely.

The California Division of Industrial Relations has opened an investigation of the death and her employer, Merced Farm Labor, whose operating permit had already been temporarily suspended by state officials based on past unpaid fines for unheeded heat safety violations, and a permanent revocation could be imminent.

The San Joaquin county coroner determined that heat was the fatal factor, and so Jimenez’s family has filed a civil suit claiming wrongful death. The district attorney and attorney general have also opened investigations.

"We’re hoping to send a signal to farmers that you don’t just hire a labor contractor because it’s the lowest bid," Robert Perez, the lead attorney on the case, told the Guardian. "We think farmers, when they hire a labor contractor, should check them out."

But activists connected to the case want to send the message even further, to stores like Trader Joe’s that market products made with cheap or exploited agricultural labor.

Merced Farm Labor was subcontracted by West Coast Grape Farming, whose president, Fred Franzia, also owns Bronco Winery, makers of Charles Shaw wine — also known as Trader Joe’s cheap and wildly popular "Two-Buck Chuck." Approximately 72 million bottles of the $2 wine are sold each year, exclusively at Trader Joe’s.

United Farm Workers, responding to Jimenez’s death, have asked supporters to fire off letters to Trader Joe’s requesting the company "implement a corporate policy to ensure that its your suppliers are not vioutf8g the law by failing to provide basic protections such as cold water, shade, and clean bathrooms."

So far reaction has been swift and significant. "We always get a big volume of response because our Listserv is very socially conscious," said Jocelyn Sherman, UFW’s director of Internet communications. "But for this we’ve gotten an overwhelming volume of response. It’s the situation. People need something to be done."

Sherman estimates as many as 15,000 e-mails have been sent from UFW supporters to Trader Joe’s, whose spokesperson, Alison Mochizuki, told us the ire has been misplaced: "The unfortunate and tragic death of Maria Jimenez highlights issues and concerns facing all agricultural industries across America. Maria Jimenez was employed by an independent contractor working in an independent vineyard. The vineyard supplies many wineries, but was not supplying grapes for Charles Shaw. The company employing the young farm worker has no more of a relation to Trader Joe’s than they do to any other wine retailer or restaurant."

However, UFW asserts that subcontracting is the historic artful dodge of many a vineyard, and a vendor like Trader Joe’s, which serves a progressive community, ought to exert its clout on these issues.

"Lovingly nicknamed ‘Two-Buck Chuck’ by a member of the wine press, these California wines have become something of a phenomenon in the wine world, and in our stores," trumpets Trader Joe’s Web site. "Contrary to many an urban legend, these super-value wines began as the result of an oversupply of wine and a great relationship with a valued supplier."

"You say you have a great relationship with this supplier," Sherman responded. "Use this great relationship to protect workers."

A spokesperson for Franzia told the Guardian that the company had no comment. Mochizuki said Trader Joe’s — which has 62 stores in Northern California — is committed to protecting workers: "Our vendors have a strong record of providing safe and healthy work environments and we will continue to make certain that our vendors are meeting if not exceeding government standards throughout all aspects of their businesses."

All your YouTubes belong to Viacom

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Happy Independence! This is one of those creepy techie developments that I wish our incredible Techsploitation columnist Annalee Newitz would sink her privacy-defending cyberteeth into, but alas, her column has ended this week.

Basically, as Machinist’s Farhad Manjoo reports (via Wired), in an ongoing copyright infringement case brought by Viacom against YouTube, a judge just yesterday ordered YouTube parent company Google to hand over “12 terabytes of logs (approximately 12,000 GB) [to Viacom] that detail each instance in which someone pressed Play on a YouTube video, plus the YouTube username of the viewer who watched it, the date and time at which the user pressed Play, and the IP address of the viewer’s computer. The database covers videos seen both on YouTube as well as those embedded on other pages: If you’ve never visited YouTube but have clicked on a YouTube video from your daily newspaper’s Web site, you’re in the database.”

Comedy Central knows you’ve watched Busty Heart crush a six-pack with her boobs!

Google Search Privacy: Plain and Simple

Viacom, idiotically, still wants to bust YouTube for transmitting copyrighted clips posted by users. “Idiotically,” I say, because if stoner/slackers didn’t put down their combo bong-remotes long enough to post “John Stewart” snippets to YouTube, I’d have absolutely no idea who the heck he was, except someone badly in need of a hairdresser.

I love Web 2.0! We’re all victims of our own pleasure. Next: US Government busts scruffy earnest dudes from Florida who trash Madonna melodically.

Nine years of everything

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› annalee@techsploitation.com

TECHSPLOITATION I’ve been writing this column for nine years. I was here with you through the dot-com boom and the crash. I made fun of the rise of Web 2.0 when that was called for, and screamed about digital surveillance under the USA-PATRIOT Act when that was required (actually, that’s still required). I’ve ranted about everything from obscenity law to genetic engineering, and I’ve managed to stretch this column’s techie mandate to include meditations on electronic music and sexology. Every week I gave you my latest brain dump, even when I was visiting family in Saskatchewan or taking a year off from regular journalism work to study at MIT.

But now it’s time for me to move on. This is my last Techsploitation column, and I’m not going to pretend it’s not a sad time for me. Writing this column was the first awesome job I got after fleeing a life of adjunct professor hell at UC Berkeley. I was still trying to figure out what I would do with my brain when Dan Pulcrano of the Silicon Valley Metro invited me out for really strong martinis at Blondie’s Bar in the Mission District and offered me a job writing about tech workers in Silicon Valley. My reaction? I wrote a column about geeks doing drugs and building insanely cool shit at Burning Man. I felt like the hipster survivalist festival was the only event that truly captured the madness of the dot-com culture I saw blooming and dying all around me. I can’t believe Dan kept me on, but he did.

Since then, my column also found a home in the Guardian and online at Alternet.org, two of the best leftist publications I’ve ever had the honor to work with. I’ve always believed the left needed a strong technical wing, and I’ve tried to use Techsploitation to articulate what exactly it would mean to be a political radical who also wants to play with tons of techie consumerist crap.

There are plenty of libertarians among techie geeks and science nerds, but it remains my steadfast belief that a rational, sustainable future society must include a strong collectivist vision. We should strive to use technologies to form communities, to make it easier for people to help the most helpless members of society. A pure free-market ideology only leads to a kind of oblivious cruelty when it comes to social welfare. I don’t believe in big government, but I do believe in good government. And I still look forward to the day when capitalism is crushed by a smarter, better system where everyone can be useful and nobody dies on the street of a disease that could have been prevented by a decent socialized health care system.

So I’m not leaving Techsploitation behind because I’ve faltered in my faith that one day my socialist robot children will form baking cooperatives off the shoulder of Saturn. I’m just moving on to other mind-ensnaring projects. Some of you may know that I’ve become the editor of io9.com, a blog devoted to science fiction, science, and futurism. For the past six months I’ve been working like a maniac on io9, and I’ve also hired a kickass team of writers to work with me. So if you want a little Techsploitation feeling, be sure to stop by io9.com. We’re there changing the future, saving the world, and hanging out in spaceships right now.

I also have another book project cooking in the back of my brain, so when I’m not blogging about robots and post-human futures, I’m also writing a book-length narrative about, um, robots and post-human futures. Also pirates.

The past nine years of Techsploitation would have been nothing without my readers, and I hope you can picture me with tears in my eyes when I write that. I’ve gotten so many cool e-mails from you guys over the years that they’ve filled my heart forever with glorious, precise rants about free software, digital liberties, sex toys, genetic engineering, copyright, capitalism, art, video games, science fiction, the environment, and the future — and why I’m completely, totally wrong about all of them. I love you dorks! Don’t ever stop ruthlessly criticizing everything that exists. It is the only way we’ll survive.

Annalee Newitz (annalee@techsploitation.com) is a surly media nerd who is slowly working on fixing her broken WordPress install at www.techsploitation.com, so eventually you’ll be able to keep up with her there again.

The dirty fight over clean power

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› amanda@sfbg.com

A charter amendment for renewable energy and public power appears headed for the November ballot, and already Pacific Gas and Electric Co. is rounding up front groups and touting inaccurate figures in an attempt to scuttle the plan.

The San Francisco Clean Energy Act, introduced by Sup. Ross Mirkarimi, would mandate that the San Francisco Public Utilities Commission "produce a comprehensive plan for providing clean, secure, cost-effective electricity for city departments and residents and businesses."

If passed, San Francisco would exceed state standards by requiring 51 percent clean, renewable energy by 2017; 75 percent by 2030; and 100 percent by 2040. Workforce development is also part of the plan, and if it’s determined that public ownership of the grid is the way to go, any employees fired by PG&E will be hired by the SFPUC.

"The San Francisco Board of Supervisors is talking about taking over PG&E," Brandon Hernandez, the corporation’s manager of government relations, said at a June 27 Rules Committee hearing on the legislation. "PG&E’s system is not for sale," he asserted. He then went on to say a takeover would cost the city "at least $4 billion."

PG&E spokesperson Darlene Chiu told the Guardian: "That’s our estimate for what our system costs in San Francisco."

But the California State Board of Equalization says all of PG&E’s state-assessed San Francisco property was worth $1.2 billion in 2007. The board’s appraisers assess PG&E’s property for tax purposes and their final figure includes millions of dollars of property that San Francisco would not want to own.

PG&E threw other punches at the city. Hernandez threatened the loss of as much as $29 million per year in taxes and charitable giving. "We no longer will be contributing to San Francisco’s nonprofits and service organizations," he said of groups that received $5 million from PG&E last year.

That money buys some political loyalty. The only organizations that spoke against the measure — the San Francisco Chamber of Commerce, the Bay Area Council, and the A. Phillip Randolph Institute — all received bucks deluxe from PG&E. Between 2004 and 2006, the Chamber of Commerce Foundation received $166,000 from the utility; the Bay Area Council and Economic Forum grossed $132,500; and APRI banked slightly more than $100,000.

The Chamber’s vice president of public policy, Rob Black, criticized the move toward municipalization because it would make San Francisco, like other municipal utilities, exempt from the state-mandated 20 percent renewable energy by 2010. "The Los Angeles utility is at 48 percent coal. That’s not green, that’s not renewable. That’s something we need to be very careful about," he told the committee.

According to the Los Angeles Department of Water and Power, their power mix is actually 44 percent coal. But Black didn’t bother to check; he just took his figures from PG&E moments before, while conferring with Hernandez and Chiu. When questioned by the Guardian, Black said, "They didn’t come to me. I went to them."

He reiterated the concern that municipally-owned power isn’t required by the state to be clean and green, and becoming so could increase rates. "If we’re creating cheaper energy, where’s the incentive to do conservation?" he asked.

According to statistics from the meeting, the average PG&E household spends $74.55 per month on electricity, with 12 percent of the energy used hailing from renewable resources. An equivalent customer in the Sacramento Municipal Utility District has a bill of $46.60 for 18 percent renewable.

APRI’s James Bryant said his Bayview community group has issues with the costs and the idea that former PG&E employees would be hired by the city and subsequently receive worse retirement plans.

When asked if he was there because his organization gets money from PG&E, Bryant said, "Not really." He added, "I don’t have anything to do with their decisions. They don’t have anything to do with my decisions.

"Of all the amoral things PG&E does, they fund very worthy grassroots organizations and then lean on them to speak against things," Sup. Tom Ammiano said when expressing his support for the legislation. "Not only is San Francisco going to have public power, the state of California is going to have public power."

Other public comments overwhelmingly supported the measure. Some energy activists have been concerned that the legislation would derail or delay efforts to move toward renewables through the community choice aggregation (CCA) program.

Editor’s Notes

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› tredmond@sfbg.com

Look, I get the gun thing. I started shooting a .22 rifle in third grade, and by the time I was 11 I had a gold National Rifle Association Sharpshooter medal on my wall. Even in my advanced, protogeriatric condition, I can still pop the logo on a Budweiser can at 50 feet; I did it two months ago, in upstate New York, with my nephew and namesake, who is a proud teenage redneck. Tim lives in a small town, wears camo, smokes the adults at paintball, and loves his firearms.

My brother, his dad, goes along with this reluctantly — in his household, there are very strict rules about gun use. The .22 and the .177 have trigger locks, and my brother keeps the only key in his pocket. The ammunition is locked up separately. And he has informed his son that anything you kill, you eat — which discourages any potshots at squirrels and birds. I can live with that.

I also have a friend in San Francisco who hunts, and I’m more than happy to go to his annual pig roast and consume the sweet, juicy, wonderful wild boar he pegged in Sonoma County.

So I get it. There are people who love target shooting, and since I was one of them many years ago, I understand. There are people who think it’s cool to go shoot a pig or a turkey or a duck and take it home for supper: since I think it’s one of the world’s great experiences to catch a bass or a trout and do the same thing, it’s hard to be critical.

But the United State Supreme Court decision last week wasn’t about my nephew’s .22 or my friend Rich’s hunting rifle. It was about whether cities can do anything remotely at all meaningful to keep 14-year-olds from shooting each other on the streets.

It’s about whether kids in Hunters Point and the Western Addition will live to graduate from high school. It’s about whether the desperate young people who are doing robberies in the Mission District and Bernal Heights will wind up shooting someone and spending the rest of their lives in prison over a bag of groceries and a hundred bucks. It’s about whether someone the age of my kindergarten daughter will take a bullet in the head one night and die from the crossfire while she’s asleep in bed.

Let’s face it: this is about handguns and assault rifles, about weapons that have very little use in hunting, that are rarely part of any sporting tradition, and that exist almost entirely for the purpose of killing other human beings.

The unnamed man who is suing — with the NRA’s money — to win the right to own a handgun in San Francisco public housing claims he needs a weapon to defend himself. I’ve been studying self-defense for 17 years now, and let me tell you a not-so-secret fact: guns are a terrible method of protection. If you own a gun in a city, the odds are far better that it will kill you or a loved one than that it will save your life. Guns don’t deter crime; they encourage crime.

And for my dear friends on the left who say that the Second Amendment protects us all from government repression, let me politely suggest that if the Marines invade San Francisco, the pistol in your attic won’t be much help.

City Attorney Dennis Herrera is fighting back on the NRA lawsuit, aggressively. He has to keep it up; this is madness.

Lennar’s bombing range in Orlando

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Explosive news from Orlando: unexploded bombs found on Lennar housing site

How did Lennar build homes on a former military base without the live ordnance first being cleared? That’s the subject of a CNN report about a neighborhood in Orlando that was built on the former Pinecastle Jeep Range.

And as questions swirl about who knew what and when, a bigger question is coming into focus: who will the homeowners be able to hold accountable, now that their homes have been built? Is it the Army Corps of Engineers, the developer?

The report notes that “multiple lawsuits have been filed, accusing builders of gross negligence and seeking unspecified monetary damage.”

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NIMBY nightmare: top ten things you don’t want to find in your backyard.

So, is this “real estate fraud” as one commentator on the CNN online edition claims?

And is it true that the government would have to step in and help the banks if all these property owners refused to pay their mortgages, claiming that the contract to buy the property was fraudulent, due to non-disclosure?

Either way, here is an interesting comment that should give prospective home owners pause:
” The twisted thing about real estate is you owe the bank not the developer. The bank pays the developer, and the home-owner is left with 30 years of house payments on a piece of property not safe to live on and lower in value than they paid for it. “

MUD money

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Originally published October 10, 2001 A San Francisco public power agency could buy out Pacific Gas and Electric Co., cut residential electricity rates by 20 percent, dramatically reduce the city’s reliance on fossil fuels – and still operate with a $18 million annual surplus, a Bay Guardian analysis shows. Our study’s figures directly contradict the argument that’s at the heart of PG&E’s campaign against public power: they show that a municipal electrical system can be bought and run at no cost to the taxpayers – with plenty of money left over. Our figures are all taken from public sources and are consistent with the financial reports of other major public power agencies in the state. In fact, if anything, our figures are conservative; the real benefits are almost certainly higher. The financial issues are essentially the same for a municipal utility district and for a city power agency, so our figures would apply to either the MUD, which would be created under Measure I, or the Water and Power Agency, which would be created under Proposition F. Calcuutf8g the financial feasibility of a municipal utility district or city power agency in detail is a complex process. Consultants typically charge upward of $1 million for detailed feasibility studies that use all sorts of models and assumptions to come up with the sorts of figures you can take to the bank (or to Wall Street to sell bonds). So our analysis isn’t anywhere near as detailed as what the MUD or the WPA will eventually have to produce. But we’ve covered all of the major revenues and costs; if we’re missing anything, it won’t radically change the bottom line. And it’s safe to say that we haven’t over<\h>estimated the financial viability of public power. The questions on the minds of most voters this fall are relatively simple: Can public power pay for itself? Will the MUD or the Water and Power Agency be a financial success? And our research shows that the answer is a resounding yes. We’ve run through two scenarios, a worst-case scenario and a best-case scenario. In each case, we’ve found, a San Francisco public power agency is more than financially viable. Our study is the rough equivalent of what a MUD’s or WPA’s annual energy report to the public would look like once the agency was up and running. In fact, we’ve pretty much followed the model of the Sacramento Municipal Utility District (SMUD) and the Los Angeles Department of Water and Power (LADWP), and we’ve relied on those two agencies’ figures to estimate some of what the city’s comparable costs would be. We’ve discussed our study with Ed Smeloff, the city’s top energy expert, and while he couldn’t verify our conclusions (since he hasn’t run the numbers himself), he said that there were no major costs that we had ignored. The results are summarized in the two accompanying charts. Where’s the money? Based on how other MUDs have been set up, the process in San Francisco would look something like this: The elected MUD (or WPA) directors would commission a detailed feasibility study outlining the financial future of the agency. Then they would begin negotiations with PG&E to buy the company’s local transmission and distribution system. If PG&E wouldn’t sell, the MUD or WPA would seize the system through the power of eminent domain. The agency would then issue revenue bonds to cover the cost of the acquisition and start-up, hire a staff, and go into the retail power business. Sales of electricity would bring in revenue that would cover operating costs and pay off the revenue bonds; any money left over at the end could be turned back to the city’s General Fund, used to reduce rates, or used for conservation and environmental projects. So the first step in analyzing the finances of a MUD is to figure out how much revenue would be available each year. That’s a relatively simple calculation. According to the California Energy Commission, PG&E currently sells about 5.4 billion kilowatt-<\h>hours of electricity to customers in San Francisco. (This figure doesn’t include energy used by the city government, since government agencies use power from the city’s Hetch Hetchy dam.) Residential, commercial, and industrial customers all pay different rates. If a MUD sold power at current PG&E rates (as provided to us by PG&E spokesperson Ron Low), it would bring in $562 million in revenue (enough to create a big annual surplus – roughly $36 million.) But a MUD or power agency almost certainly wouldn’t sell power at PG&E’s high rates – one major attraction of public power is that it offers cheaper electricity. So in both of our scenarios, we assumed that the rates would be at least 10 percent below PG&E’s rates. In fact, as our study shows, rates could drop as much as 20 percent without harming the MUD or WPA’s viability. What’s it cost? There are three basic categories of costs that the agency would have to cover. The first is payments on the bonds, the second is generating or buying power, and the third is basic operations and maintenance (paying the staff to keep the system up and running, to send out bills, to read meters, as well as operating the repair trucks, etc.). Electricity can’t just be delivered to the doorsteps of customers like canned ham in a UPS box. It has to be distributed through a network of transformers, substations, wires, and poles and measured with individual meters. And until the public power agency owns that distribution network, it can’t sell a single kilowatt. Unfortunately, the system that’s now in place in San Francisco is owned by PG&E – and almost everyone involved agrees that it would be cheaper, easier, and quicker for the city to take over that system than to build a new one from scratch. That’s what SMUD did and what most other public agencies that have gotten into the power business in the past half century have done. A MUD or a city power agency would have the right to seize PG&E’s property by eminent domain. But PG&E would be entitled under law to fair compensation for the taking of its property, and one of the most complex, bitter – and crucial – issues involved in establishing public power will be the price tag. “This is not an easy case at all,” Richard Epstein, a professor of law at the University of Chicago and a national expert on eminent domain, told us. “I can guarantee you that nobody, but nobody, has any idea right now what fair compensation would be.” The issue will almost certainly be settled in court. PG&E insists that its San Francisco property is worth a small fortune – as much as $1.4 billion. In a 1996 study the Economic and Technical Analysis Group suggested that the price could be anywhere from $315 million to $1.2 billion. The ETAG study, which was highly favorable to PG&E, suggested that the most likely figure was around $795 million. The reason those figures are so widely divergent is that there are numerous ways of evaluating what a utility’s property is worth. The simplest is to establish what PG&E originally paid for the property, then factor in depreciation. That’s how insurance companies decide what they have to pay you if your car is stolen. The process generally leads to a low figure favorable to the city. But courts have recently been somewhat more friendly to an analysis that recognizes that utility property is more valuable than, say, a private car, because the utility property produces income. One way to address that is by valuing the property at its replacement cost and factoring in the value of a “going concern” – which, of course, leads to a much higher price. Real market value But there’s another way to look at the issue, and that involves going to the state agency that appraises the actual market value of PG&E’s property for tax purposes: the Board of Equalization. Every year the board’s appraisers evaluate exactly what PG&E’s property is worth – and the agency’s record is pretty good. When California’s private utilities sold 22 power plants under deregulation, the board checked its appraisals against actual market prices, and while sale prices for some plants varied from estimates, the board was accurate to within 1 percent overall, chief appraiser Harold Hale told us. The Board of Equalization estimated that as of January 2001, all of PG&E’s property in San Francisco was worth $962,140,298. That includes property that isn’t at all relevant to running an electric utility. The value of the property actually used in the electricity business, the board says, is $753,978,471. But that figure includes PG&E’s huge 77 Beale St. headquarters office complex, which the city almost certainly wouldn’t want or need to buy in an eminent domain action. If you subtract 77 Beale St. (which one real estate expert we contacted said was worth about $225 million as of Jan. 1), then the value of the property the city might actually buy is about $528 million. It may be even less than that: the real estate market has fallen almost 15 percent since Jan. 1, according to our expert, a senior executive at one of the city’s biggest firms, who asked not to be identified by name. However, to be conservative, we’re sticking with the Jan. 1 figure. Epstein, who has worked as a consultant fighting municipalization efforts and thus isn’t inclined to be biased in favor of a public buyout, agreed that using the Board of Equalization figures is “certainly a good place to start.” There’s no guarantee that the courts will accept this approach (although, with PG&E in bankruptcy court right now, it’s also entirely possible, experts say, that PG&E might be forced to accept a much lower value for its property and sell it without a fight, in order to pay off some creditors with cash). So we also analyzed a worst-case scenario, essentially accepting the figures of ETAG’s much maligned report and assuming that, under a replacement cost-<\d>plus-<\d>”going concern” analysis, the city would have to spend $795 million to take over the system. (Even ETAG concluded that it’s unlikely the final price would be as high as PG&E’s estimate; nobody whose property is up for seizure starts off by quoting a realistic price.) No matter what the price, the bond sale will have to include some money for contingencies – the actual cost of the bond sale, start-up cash, etc. We’ve added $50 million for those costs. Paying the staff, buying power PG&E doesn’t publicly reveal its operating costs for San Francisco (or any other specific service area). And it’s difficult to use the company’s system-<\h>wide operating costs as a basis for estimating San Francisco costs, since the population of San Francisco is so much denser than in most of the company’s northern California territory. The denser the population, the cheaper it is to serve; the distance between customers is smaller, so you need less transmission line per customer. Reading meters is faster, since the employee doing that work doesn’t have to drive long distances between each house. Repairs and maintenance are cheaper for the same reason. And PG&E’s costs aren’t a fair comparison for a public power agency anyway: PG&E pays huge executive salaries (see “Public Power vs. PG&E,” page 24), which are included in the operations overhead. So we based our cost estimate on LADWP, which is about as close a comparison to San Francisco as we could find. Los Angeles is not quite as dense as San Francisco, so the L.A. figures are almost certainly higher than what San Francisco would pay, but they provide a reasonable, if conservative, estimate. LADWP’s cost per customer is $383; multiplied by the number of customers in San Francisco, that cost is $131 million a year. Then there’s the question of generating or buying the electricity. Here San Francisco has a huge advantage over other public power agencies: The city owns a large hydro<\h>electric dam that can generate enough to cover some of the local power needs – and it’s already paid for. Power from the Hetch Hetchy dam is cheap: the cost of operating the system is only about 2¢ a kilowatt-<\h>hour. Unfortunately, the city also has to pay PG&E to ship the power over its lines to the city borders, since the city has no complete transmission line to carry the power here; San Francisco pays PG&E $9.6 million a year in what’s known as “wheeling fees.” San Francisco currently sells most of the available Hetch Hetchy power to the Turlock and Modesto Irrigation Districts. Our analysis assumes that those contracts will be broken and that much of the power – 425 million kilowatt-<\h>hours’ worth – will be available to the MUD or WPA. The city also has a very expensive contract with Calpine to provide backup energy when water is low at the dam. The wheeling fees and Calpine deal boost the actual cost of Hetch Hetchy power to about 4¢ a kilowatt-hour. But the Calpine deal ends in five years, at which point Hetch Hetchy power will be far less expensive – and the MUD’s costs will go down. Green power Our analysis is based on the assumption that San Francisco will move as rapidly as possible to reduce its reliance on fossil fuels (see “Green City,” 9/26/01). Not all of the alternative-<\h>energy sources that should ultimately be part of the city’s mix are likely to be online when the MUD starts operating, so we’ve again been conservative, assuming in our worst-case scenario only a modest amount of solar power to supplement Hetch Hetchy power. In our best-case scenario we assume that the city will be able to develop 200 megawatts of solar and wind power – five times as much as projected in the solar bond measure, Proposition B, and enough to power 200,000 homes. The cost of solar and wind is easy to determine: it’s the cost of the interest on the bonds needed to buy and install the windmills and panels. Once they’re up and running, they cost very little to operate – and the fuel, of course, is free. Based on the San Francisco Public Utilities Commission staff’s analysis of Prop. B), 40 megawatts of solar, wind, and efficiency programs – the equivalent of 98 million annual kilowatt-<\h>hours – will cost about $7.5 million a year. Our ambitious plan – for five times that much solar and wind power- would cost $38 million a year. (Again, the actual costs will probably be lower; once a big agency orders a large amount of solar- or wind-<\h>generating facilities, the price goes down substantially.) The rest of the power the city needs will have to be bought on the open market. Because the market is so volatile, it’s hard to say exactly what that cost would be. But futures contracts for power are listed on the New York Mercantile Exchange Web site, and they’re currently running at less than 4¢ a kilowatt-hour. That price is expected to decline in the future. Again, we’ve stuck to conservative numbers, assuming the MUD or WPA would have to pay 6.9¢ a kilowatt-<\h>hour for power generated locally, by Mirant Corp.’s Potrero Hill power plant (one energy expert told us that Mirant is unlikely to accept less than the 6.9¢ the state is now paying for power), and 5.5¢ a kilowatt-<\h>hour for power bought from out-of-town sources. We assumed that the Potrero plant would operate at its capacity. The power the city would import can’t exceed the amount that can be carried along the one transmission line leading into San Francisco, and our projection meets that criterion. PG&E pays a substantial amount of taxes to the city, and almost all of the San Francisco-<\d>Brisbane MUD Board candidates have pledged to make sure that, at the very least, the city’s General Fund doesn’t lose any money if the private utility is replaced with a public agency. So part of the MUD’s expense would be the payment of a fee to replace what PG&E paid in taxes. The utility pays three major taxes: property taxes, a franchise fee, and business taxes. Based on the Board of Equalization’s assessed value for PG&E ($962 million) and the city’s property tax rate, PG&E’s property taxes are about $1 million. The franchise fee – 1.5 percent of sales – adds another $8.4 million. It’s impossible to say how much PG&E pays San Francisco in business taxes, since that figure is not public, but even at several million dollars a year, it wouldn’t significantly change our bottom line. Unanswered questions There are plenty of questions our analysis doesn’t – and can’t – answer, factors that are impossible at this point to predict with any accuracy. PG&E customers, for example, have to pay a substantial surcharge on their electric bills for what’s known as the CTC, or competitive transition charge. In essence, that’s the money ratepayers have been forced to cough up to cover the cost of PG&E’s bad investments in nuclear power. It’s possible that a San Francisco power agency would have to include some of those charges in its bills – but according to Mindy Spatt, media director at TURN, it’s unlikely. The CTC is expected to end next year and probably wouldn’t be a factor by the time the MUD or WPA was up and running. It’s also unclear whether the MUD or WPA would have to pay a share of the costs of the expensive long-term power contracts that the state Department of Water Resources has signed to buy power for the bankrupt PG&E. There would almost certainly be some substantial legal fees, possibly in the millions of dollars, that would reduce the surplus during the first few years (but not once the eminent domain issues were settled). Most of the MUD candidates have voted to shut down PG&E’s Hunters Point plant, and it’s unclear how much it will cost to decommission that facility. The MUD or WPA could also buy the Potrero plant (it recently sold for $330 million) and pay less for the power generated there. And, of course, it’s uncertain how much electricity will cost on the open market in the next few years. That’s why the MUD or WPA would probably want to move aggressively to increase its own generating capacity. But if power prices go up, one thing is clear: PG&E’s prices will go up higher, and faster, than the prices of a public power agency. Voters won’t have to take our word alone on the subject. The public will have more information on San Francisco’s energy plans in the coming weeks. The county’s Local Agency Formation Commission is planning to bring in experts on public power and energy for hearings, and Smeloff is hiring Amory Lovins’s Rocky Mountain Institute to assess the city’s energy alternatives. Both reports are expected before the Nov. 6 election. Our analysis isn’t that radical or unusual; it just confirms the experience of every other major public power agency in the state. We’ve found what just about everyone who’s gotten out from under the private utilities already knows: public power is cheaper. It’s that simple. Public power in San Francisco: Best-case scenario (Low rates, extensive renewable energy) Revenue1 Residential sales 1.481 billion kwh @ 11.5¢ per kwh $170 million Commercial/industrial sales 3.942 billion kwh @ 9.5¢ per kwh $374 million TOTAL $544 million Expenses Payment on revenue bonds $578.9 million @ 8 percent2 $50.9 million Cost of power * <\i>Hetch Hetchy 425 million kwh @ 4¢ per kwh3 $17 million * <\i>Solar, wind, efficiencies 500 million kwh4 $38 million * <\i>Potrero Hill plant 1.6 billion kwh @ 6.9¢ per kwh $110 million * <\i>Contract purchases 2.90 billion kwh @ 5.5¢ per kwh5 $160 million Operations and maintenance6 $131 million Replace PG&E’s city taxes7 $9.4 million Public benefits8 $10 million TOTAL $526 million Surplus $18 million This chart shows how a San Francisco public power agency could take over Pacific Gas and Electric Co., reduce the city’s reliance on fossil fuels, provide all of the electricity the city needs, and still have money left over. The analysis would apply to either a municipal utility district or a city water and power agency. Proposals for both are on the November ballot. (The MUD proposal would include both San Francisco and Brisbane, but since Brisbane is a very small area – only about 4,000 residents – and since it’s difficult to get accurate data on Brisbane’s current usage, our numbers include only San Francisco. The cost of providing service to Brisbane and the revenue from that jurisdiction would not significantly change the analysis.) The scenario presented here is an optimistic one – although, based on our research, the figures are quite realistic. All of the figures we’ve used are conservative – if anything, our analysis underestimates the financial viability of the MUD or a city WPA. The bottom line: Even with residential rates 20 percent below what PG&E currently charges, and with a huge investment in solar and wind power (five times the size of what the city is currently planning), the MUD or WPA would run a large surplus. This study reflects what a MUD or WPA would be facing several years into its existence. In the first few years, the agency would probably have to buy more power on the open market and would generate less from solar and wind (which take time to set up). But on balance that probably lowers the cost of power (solar is comparatively expensive). There are certain to be factors that we missed – although our cost and revenue projections are very similar to what we found in the annual reports of other large public power agencies such as the Sacramento Municipal Utility District (SMUD) and the Los Angeles Department of Water and Power (LADWP). But we’ve accounted for every foreseeable big-ticket item, and the projected surplus is large enough to cover unexpected costs. 1Revenue is based on sales of 5.4 billion kilowatt-hours: the amount PG&E currently sells in San Francisco, according to the state Energy Commission. A MUD or WPA could set rates at any level it wanted; for this analysis, we set residential rates at 20 percent below PG&E’s current rate of 14¢ a kilowatt-hour rate (which is projected to rise sharply). We assumed that commercial and industrial rates would be at the low end of PG&E’s scale. 2This assumes the MUD or WPA can buy PG&E’s assets at current market value, as assessed by the state Board of Equalization as of Jan. 1, 2001 (see story for details). Ken Bruce of the Board of Supervisors’ Budget Analysts Office told the Bay Guardian that 8 percent would be a reasonable projection for the interest on revenue bonds. 3Hetch Hetchy currently generates about 1.7 billion kilowatt-hours a year, and half of that goes for city government needs – Muni, the lights at City Hall, etc. We assumed that the city would pay the MUD what it pays now – the actual cost of generating the power – so the power sold to the city would be a financial wash. Thus it’s not in our analysis as either a cost or a revenue item. The cost we project for Hetch Hetchy power is high – it includes unfavorable contracts that will expire in five years (see story). The actual future cost would be closer to 2¢ a kilowatt-hour. 4The cost of solar and wind is based on financial estimates for Prop. B. 5It’s impossible to determine exactly what it would cost the MUD or WPA to purchase power in the future, but future contracts currently listed on the New York Mercantile Exchange are going for less than 4¢ a kilowatt-hour, and that price is expected to drop. Again, we took a conservative estimate; actual costs might be lower. 6Based on the cost per customer of operations and maintenance at LADWP (see story). 7The MUD would have no obligation to pay city taxes, but almost all of the candidates for MUD director have pledged to make sure the city doesn’t lose money – in other words, the MUD would almost certainly pay fees equivalent to what PG&E was paying in taxes (see story). 8The state mandates that power companies or agencies spend 2 percent of revenues on “public benefits” – conservation, environmental programs, and the like. Public power in San Francisco: Worst-case scenario (Moderate rates, less renewable energy) Revenue Residential sales 1.481 billion kwh @ 12.6¢ per kwh1 $186 million Commercial/industrial sales 3.942 billion kwh @ 9.5¢ per kwh2 $374 million TOTAL $560 million Expenses Payment on revenue bonds $850 million @ 8 percent3 $74.4 million Cost of power * <\i>Hetch Hetchy 425 million kwh @ 4¢ per kwh $17 million (includes wheeling and backup)4 * <\i>Solar, wind, efficiencies 98 million kwh5 $7.5 million Purchased power6 * <\i>Potrero Hill plant 1.752 billion kwh @ 6.9¢ per kwh $120 million * <\i>Contract purchases 3.098 billion kwh @ 5.5¢ $170 million Operations and maintenance7 $131 million Replace PG&E’s city taxes8 $9.4 million Public benefits9 $10 million TOTAL $539 million Surplus $21 million This chart shows how a public power system in San Francisco would operate if some of the worst-case assumptions are true: if, for example, the municipal utility district or power agency had to spend $800 million to buy out PG&E’s system (the highest likely figure, even according to pro-PG&E studies) and if the MUD was unable to fund and site affordable renewable-energy systems and was thus forced to rely on buying a large amount of its power from the Potrero Hill plant (owned by Mirant Corporation) and from other generators through long-term contracts. Even under those circumstances, the chart shows, the MUD could cut residential rates by 10 percent, keep commercial and industrial rates at the low end of PG&E’s rates, and still end the year with a surplus. As in all of our calculations, the numbers are very conservative; expenses would probably be considerably lower. 1The MUD could set rates at any level it wanted; for this scenario, we’ve set residential rates at 10 percent below PG&E’s current rates. 2The commercial/industrial rate is at the low end of PG&E’s equivalent rate. 3See story for details on the $850 million figure. The bond rate of 8 percent is based on an estimate from Ken Bruce of the Board of Supervisors’ Budget Analyst’s Office. 4See story and “Public Power in San Francisco: Best-Case Scenario” for details. 5This is the amount of solar and wind power projected in the city’s report on the solar bond measure, Proposition B. 6See story and “Best-Case Scenario” for details. 7Based on comparable costs per customer at LADWP. 8See story. 9See story.

Lennar asks feds for help–Republican senator blocks bill

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Are we worried, yet? With San Francisco having climbed deeper into bed with Lennar thanks to Prop. G’s passage, the bad news coming from Wall Street and beyond can’t exactly be music to Mayor Gavin Newsom’s ears.

As Lennar reported bigger-than-expected quarterly losses today, Lennar’s Chief Executive Officer Stuart Miller expressed hope that the federal government would soon belly up and help bail out the beleagured housing industry.

Miller cited increased foreclosures, higher unemployment rates and diminished consumer confidence as reasons why the Florida-based mega developer experienced a 61 percent loss in revenues this quarter.

“With the U.S. housing inventory growing in excess of absorption and limited credit available, the prospect of further deterioration in the homebuilding industry will likely become reality absent Federal government action,” said Miller, who is apparently hedging his political bets by making the maximum campaign contribution to both presidential candidates.

“To that end, we are hopeful that the Federal government will acknowledge the need for further reform and will institute programs designed to stabilize and facilitate the recovery of the housing market.”

But a government plan to address the nationwide foreclosure crisis hit a roadblock in the Senate yesterday in the shape of a Republican from Nevada, Sen. John Ensign.

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Sen. John Ensign (Nevada) wants $7 billion for renewable energy tax credits before he’ll support foreclosure bill.

This isn’t the first time that Ensign has played the role of lone obstructionist.

In September 2007, the Senate discovered that Ensign was using the “secret hold” to obstruct a bill that requires senators to file fund-raising reports electronically, rather than bury the identity of their benefactors in paper filings.

And for a short period in March 2006, Ensign blocked the nomination of Vice Admiral Thad Allen (who replaced FEMA director Mike Brown in the aftermath of Hurricane Katrina) to become the next Commandant of the U.S. Coast Guard.

But now Ensign, who reportedly has been tasked with assembling a staff to win back the U.S. Senate for Republicans in November 2008, is blocking a foreclosure rescue plan that has broad bipartisan support until he gets a vote on his amendment to provide almost $7 billion in renewable energy tax credits.

As a result, passage of the housing bill to create a multi-billion fund to aid thousands of homeowners refinance costly mortgages into more affordable government-backed loans, will likely be delayed until after July 4.

“In an election year, very few things are actually going to make it into law,” Ensign told reporters, “So if you actually want to get something done, you need to be on that train that is basically going to be leaving the station.”

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While Lennar spent $5 million to defeat a grassroots coalition that wanted 50 percent affordable housing in the Bayview, the City applied for $25 million in grants to bail out Lennar’s Shipyard development.

Here in San Francisco, Lennar Corp. has assured elected officials that there is no relationship between LandSource, a land and development company that filed for Chapter 11 bankruptcy on Sunday, June 8, and Lennar’s Bayview Hunter’s Point project.

In a June 9 letter to San Francisco Mayor Gavin Newsom, Lennar Corporation’s Chief Investment Officer Emile Haddad wrote, “We anticipate that there may be some effort to link LandSource to other Lennar ventures, including Hunters Point Shipyard. Let me be clear: There is no relationship between the two entities. Hunters Point has its own capital structure and financial partners.”

Haddad does not however explicitly mention that LandSource, which owns properties in California, Arizona, Florida, Texas and New Jersey, does have a relationship with Lennar Mare Island, which also filed bankruptcy June 8, leaving city officials in the already bankrupt Vallejo doubly stressed.

And nowhere does Haddad guarantee San Francisco a smooth, obstacle-free redevelopment of Bayview Hunters Point, which apparently is already facing a potentially fatal $25 million funding gap, according to City officials.

“Lennar is committed to continuing to work closely with our community partners and the City and County of San Francisco to overcome any obstacles and to work toward a successful venture,” Haddad writes. “You have my personal reassurance that we will keep you fully informed of any and all significant developments that may impact the project.”

“Likewise, we will continue to utilize the development’s partnership experience and qualifications to leverage all state and federal funding sources to enhance the project and ensure its timely completion.”

As for Lennar’s CEO Stuart Miller, he told investors that “notwithstanding the bleak operating environment, Lennar made significant progress during our second quarter.”

This progress included reducing unsold completed inventory. “We now have on average less than one completed unsold home per community.”
Lennar also reduced selling, general and administrative expenses by 60 percent.

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“Given our success with asset reduction, we have shifted our primary focus to the execution of an efficient homebuilding model through the repositioning of our product to meet today’s consumer demand and by aggressively reducing our construction costs.”

Sounds like a potential Triple Uhoh.

‘we are very pleased to end our second quarter with approx $880 million in cash and no outstanding borrowings under our credit facility. We have reduced our maximum joint venture recourse debt by approximately $1 billion from its peak level in 2006, which reflects a decrease of over 50 percent.”

“We recognize that the remainder of 2008 will likely see further deterioration in overall market conditions; however, we are confident that we will remain well positioned with a strong balance sheet and properly scaled operations to navigate the current market downturn as a leaner and more efficient homebuilder.”

Meanwhile, following a posting of a video showing some community members less than positive take on Lennar, someone replied with a video about Lennar’s homebuilding operations in Texas.

Seems like some folks in the Bayview aren’t the only ones, er, frustrated with Lennar.

The new privacy

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› annalee@techsploitation.com

TECHSPLOITATION It’s shocking how quickly we’ve all gotten used to the idea that the government can and will listen in on everything we say on our telephones, as well as everything we do on the Internet. Case in point: the FISA Amendments Act passed in the House last week, and is predicted to pass the Senate this week. This is a bill that grants telecoms retroactive immunity for illegally giving the National Security Agency access to the phone calls and Internet activities of millions of US citizens. What this bill ultimately does, aside from not holding companies accountable to the Constitution, is open the door for future mass infractions.

We’re looking down a fiber-optic cable that leads to a future where US spies can snarf up everybody’s data without warrants, combing through it for potential suspects in an ongoing digital witch hunt for terrorists or other "bad guys." I’m not saying anything new here. This is just a quick recap of every progressive futurist’s nightmare: it’s an Orwellian world where nothing you do goes unseen.

My hope is that this absurd bill won’t pass the Senate. But if it does, at least we can hope it will be somehow held in check by other laws to come, and by constitutional challenges. But I still think it’s time that we kiss our old-fashioned notions of privacy goodbye.

And not because we will all reveal our secrets and therefore be equally naked, as "transparent society" shill David Brin has argued. We never will be equally naked. There will always be governments and wealthy entities that have the means to cover their tracks and hide their transgressions. I think we must shed the idea that somehow we can protect the rights of ordinary people by protecting what we in the United States once called privacy.

The notion that we should each be granted a special sphere where everything we do goes unseen, unremarked, and unrecorded is a relatively new notion in itself, something that could hardly have existed in a small-town society where everybody knew everybody else’s business. And it still hardly exists in many high-density countries like Japan and China, where privacy is not as prized as other rights are.

What we ask for when we ask for privacy in the United States is a simply a space (physical or digital) to do legal things without fear of reprisals. Even when we had a more tightly-wrapped notion of privacy, say, 50 years ago, it was hardly perfect. Secrets leaked; spies spied. But there were no 24-hour videocam logs and detailed records of your every correspondence available and searchable online. You could write love letters to your secret admirer, ask her to burn them, and be sure nobody would ever know about your forbidden love.

If those letters were intercepted in a small community, your infamy would live forever. Not so in the digital age, when there’s so much readily available infamy that nobody could be bothered to remember your indiscretions for more than a few seconds. What I’m trying to say is that we will never have the old privacy of the burned letter again.

Instead we will have the new privacy, where what we do can be seen by anyone, but will mostly be hidden by crowds. The problem is that we still lose the old privacy forever. My secret transgressions may be drowned out by multitudes, but anyone who is determined to spy on my most private life will probably be able to do so — without a warrant.

So what do we do? Develop new standards of propriety, becoming as formal and controlled behind closed doors as we are in public? I think that will have happen in some cases. And in most cases, people will rely on crowds to hide them, hoping they never fall under sustained scrutiny. The more noise all of us make, the more we can help to hide the innocent. There will be a kind of privacy in the crowd.

But there will also be a private class of people who never have to rely on crowds. To return to my earlier point, I don’t buy for a minute the idea that at some point everyone — including the rich and politically connected — will be subjected to the same scrutiny as those people whose phone records were illegally handed over the to NSA by AT&T. The powerful will continue to have old-fashioned privacy, while the rest of us must get used to living without it.

Annalee Newitz (annalee@techsploitation.com) is a surly media nerd who tried to hide behind a crowd once but they dispersed.

The commissioner’s conflicts

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› gwschulz@sfbg.com

Before the June 5 special meeting of the San Francisco Planning Commission got underway, Michael Antonini had an announcement.

Dressed in a charcoal suit and red-checked tie, with his white hair combed back over his skull, the longtime commissioner disclosed that he was a part owner of a condominium in the eastern neighborhoods, where a years-long rezoning effort is nearly complete. That means Antonini is among the people who could benefit from increased land values due to zoning upgrades.

As a result, Antonini begrudgingly declared that he would have to recuse himself from hearings involving the eastern neighborhoods until the potential conflict is dealt with.

"Hopefully this can be resolved in the next few weeks and I’ll be able to participate at later hearings," Antonini said at the meeting.

But it was a bit late to be complying with the state’s conflict-of-interest laws: Antonini had already actively taken part in meetings in which the plan was discussed. And Antonini also neglected to mention that after he and his son purchased the condo, he voted on two other projects that appear to be within steps of it.

Public records show that Antonini bought the $515,000 condo at 200 Townsend Street in 2003 with his real estate agent son, John. Commissioner Antonini and his wife own a 25 percent stake in the property through a family trust the couple created in 1997. His son holds the majority interest.

Antonini worked hard to play down his stake in the condo at the June 5 meeting. It’s not an investment property, he made clear to the commissioners. There’s no rent generated from it. He’s a mere minority holder in a family trust that controls the condo, and it was purchased as a residence for his son and his wife.

"Because I did not believe our fractional interest in John’s condo represented a conflict, I did not consider reclusing [sic] myself from projects near the condo," Antonini wrote to the Guardian.

But the laws on this are pretty clear. The state’s Political Reform Act of 1974 prohibits public officials from participating in decisions that will have a "foreseeable material financial effect on one or more of his/her economic interests." It also states that any "direct or indirect interest" worth more than $2,000 poses a potential conflict, for which a 25 percent stake in a half-million dollar condo would seem to qualify.

RECUSE ME


Other public officials in similar situations have recused themselves long before the issue became a potential political liability.

Sup. Bevan Dufty bought into a three-unit residential property on Waller Street with two co-tenants in December 2006. He immediately sought advice from the city attorney, who told him he no longer could vote on the Market-Octavia Plan, a series of land-use changes in Hayes Valley, Duboce Triangle, and elsewhere that was similar in scope to the current rezoning efforts in the eastern neighborhoods. The supervisor also couldn’t vote on a major Laguna Street redevelopment project or on legislation making it easier for seniors to convert rental units to condos.

Antonini told us that "only in the last month" did the city attorney warn some officials involved with plans for the eastern neighborhoods that if they held property in the area, there could be a conflict of interest.

"We’ve been working on [the eastern neighborhoods] for the whole six years I’ve been on the planning commission," he said at the meeting. "It’s a little troubling that this issue of conflict is raised now rather than at the very beginning."

The law does make an exception when the economic interests of the "public generally" could also be enhanced by a government decision such as those that have an impact on a large section of the city like the eastern neighborhoods. But the city attorney’s office concluded for now that the condo indeed may pose a conflict. And in the meantime, Antonini told us that the Fair Political Practices Commission in Sacramento, which helps enforce the state’s Political Reform Act, is being consulted to determine "whether our fractional interest in the condo truly represents a conflict of interest."

The eastern neighborhoods planning process isn’t the only legislation that created a potential conflict for Antonini. The commissioner voted in January 2007 to approve construction of 26 new single-room occupancy units at 25 Lusk Alley, not far from his property at 200 Townsend. The project’s sponsor, Michael Yarne, is a land-use attorney who today works for the mayor’s economic development office. The project was approved, according to meeting minutes.

The project itself relied on a contentious legal loophole in which developers claim their units are "single-room occupancy," a necessity because the area permits residential efficiency hotels where the poor and working-class used to live. Allowing such SRO hotels in areas zoned for light industrial uses enabled the city to preserve some forms of affordable housing. But builders can turn around and lease the opulently large units such as the ones at 25 Lusk, which bear little resemblance to genuine SRO rooms, to well-heeled clients.

"They are allowed where normal residential units are not allowed, because historically SROs were always extremely affordable housing," community organizer Calvin Welch said. "The whole notion of market-rate SROs is a new invention, and that’s why they’re controversial. They’re basically the new version of live-work lofts."

In November 2006, Antonini also voted to approve a liquor license for a new full-service restaurant and wine bar at 216 Townsend, even closer to his son’s condo.

TOO CLOSE FOR COMFORT


State ethics laws say that a public official has a conflict if his or her property comes within 500 feet of a project the official will be scrutinizing and voting on.

Conservatively measuring from the furthest corners of each property, Google Earth puts both the proposed restaurant and SRO within 500 feet.

Bob Stern, president of the Los Angeles–based Center for Governmental Studies and co-author of the state’s Political Reform Act, said a public official could face $5,000 in civil penalties for each conflict-of-interest violation. But it’s not common for the chronically under-resourced FPPC to go after local officials, he said.

Mayoral spokesperson Nathan Ballard wrote in an e-mail that "we take any allegations of conflicts of interest seriously" but added there is a disagreement over whether the "public generally" exception applied to the eastern neighborhoods and that the City Attorney’s Office was seeking additional input from the FPPC.

As for the two projects he voted on near the condo, Antonini apparently told the mayor’s office he had looked into whether 25 Lusk fell inside 500 feet. "Based on his understanding at the time," Ballard wrote, "they didn’t."

That’s a stretch, at best. The projects are in the same block. We walked them off and found that Antonini would have to be splitting hairs to argue that they are outside the boundary — and even in that case, it would be only by a few feet. The rusty red paint job, black trim, and stylish, outsize windows of 200 Townsend are easily viewable from the backside of 25 Lusk.

"If there is a legitimate argument that they did fall within the 500-foot radius, this should be clarified," Ballard stated. "However, given the relative insignificance of the two projects cited in your e-mail and Antonini’s long-standing reputation as an ethical and hard-working commissioner, we don’t have any reason to believe that he would have knowingly and/or willingly violated the state’s Fair Political Practices Act."

But the Lusk Street project was by no means insignificant. "They are highly regulated," Welch said of SROs. "You cannot convert them to tourist hotels without going through a very long and cumbersome process. They are valued for affordable housing so highly that the city regulates their conversion to tourist uses." So instead, the "corporate suites," as Welch calls them, masquerade as SROs. The project was approved in the end, but two commissioners — Christina Olague and Sugaya Hisashi — voted against it.

Antonini told us that he believes 25 Lusk is more than 500 feet away, and as for the restaurant, planning staff recommended approval.

The commissioner told us, "I was the one who brought public attention to the issue of my possible conflict. I believe it is a small issue when compared to my body of work on behalf of San Francisco over the last six years."

The June 5 meeting where Antonini made the disclosure about his son’s condo was part of a long and detailed process that will determine the fate of vast sections of Potrero Hill, SoMa, the Mission District, and Dogpatch. The official planning process for the targeted 2,200-acre area began back in 2001, and the commissioners could approve new zoning plans next month before sending the proposal to the Board of Supervisors.

For much of San Francisco’s history, the city sections poised for rezoning have been home to light industry and blue-collar jobs. But housing has encroached over the last 15 years, and the planning commission is prepared to allow between 8,000 and 10,000 new units over the next 20 years. That will almost certainly increase the value of land in the area.

Residential developers built thousands of pricey condos in the SoMa District during the 1990s, exploiting another divisive zoning loophole that created waves of animosity across the city and aided in a takeover of the Board of Supervisors by a progressive bloc of candidates.

Live/work lofts, as developers called them, were built in areas zoned for light industrial commercial purposes. Wealthy buyers would ostensibly operate businesses out of their homes or live in them as working artists as the zoning required, but few have complied with the letter or — having found ways to narrowly abide by it — the spirit of the law.

"The city turned its head," housing attorney Sue Hestor said. "We have 3,000 units that are supposed to be occupied by artists and probably 90 percent of them are not occupied by artists at all. It’s blatantly illegal."

Antonini has managed to maintain friendships with local moderate Democrats over the years despite being an elected member of San Francisco’s Republican Party County Central Committee. Willie Brown first appointed him to the powerful planning commission in 2002, and he’s been a reliable vote for developers and other large business interests. Mayor Gavin Newsom reappointed him in 2004 and earlier this year tried to engineer Antonini’s election as president of the commission.

Tim Russert – an alternative view

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By Bruce B. Brugmann

I started cringing early on when the floodtide of eulogies came in for Tim Russert. I cringed because NBC and MSNBC forgot about journalism and went instead for self-reverence to the maximum. And I cringed because so many politicians came forward so quickly to praise him so glowingly and NPC was so happy to run them. And I cringed because all of this once again made the point so dramatically about the incestuous relationship between the press and the political establishment inside the Beltway in Washington, D.C.

I liked Tim Russert, NBC’s Meet the Press anchor and Washington bureau chief. I realized that he had taken a moribund television news program and transformed it with his personality and ability into the premiere Washington television news program. And I liked the fact that he volunteered to cover the presidential primaries and provided some zest and insights.

But there were many things I didn’t like about Russert’s approach to journalism, most notably the fact that the Bush administration loudly claimed it used his Sunday morning show as its favorite to promote its war in Iraq and that Russert never properly challenged them. “In reality, Meet the Press was the venue for some of the White House’s most audacious lies about the Iraq War–most of which went unchallenged by Russert,” according to an excellent critique of Russert by the media organization Fairness & Accuracy In Reporting…

“Recalling such softball questioning, it’s easy to believe the advice that Cheney press aide Cathie Martin says she gave when the Bush administration had to respond to charges that it manipulated pre-Iraq War intelligence: ‘I suggested we put the vice president on Meet the Press, which was the tactic we often used,’ she said (Salon, l/26/07). ‘It’s our best format.'”

Russert also demonstrated the problem with Beltway access. He had access to the politicians and political establishment for his shows but he refused to use his powers of access for critics of the war and people outside the political establishment.
FAIR pointed out that in Bill Moyers’s documentary “Buying the War” (PBS, 4/25/07), Russert said he wished that dissenting sources would have contacted him: “My concern then was, is that there were concerns expressed by other government officials. And to this day, I wish my phone had rung, or I had access to them.” Of course, as FAIR noted, “any journalist could have found such sources–and few critics of the war would have passed up an opportunity to air their views on such a prominent media platform.” Why didn’t he have access to Noam Chomsky, Howard Zinn, the authors of Project Censored stories, or the director of Project Censored, the Nation people, Frank Rich at the New York Times, or other major war critics who, among other things, weren’t lying and happened to be proven right on their positions against the war, the occupation, and the surge?

FAIR quoted Russert as saying that the White House claims “were judgments, and there was no way at that time to say, ‘You’re wrong. How could you possibly say that? You’re lying.’ That’s just not the style of Meet the Press, nor I think the style of good journalism, but we now have a permanent record as to the judgments believed by the Bush administration going into the war and you can look at them three years later and decide whether they were correct or not.'”

Well, as FAIR concludes, “there are journalists who examine the claims made by politicians at the time they make them, and some were doing just that with the assertions Bush Administration officials used to justify the invasion of Iraq (Extra!3-4/06). Had a journalist with the prominence of Tim Russert done so, it’s possible that the debate could have had an entirely different outcome.”

The example I like to use is that the Guardian, and many other alternative newspapers and voices, with no special sources in Washington or Iraq, could figure out that this was the wrong war at the wrong time for the wrong reasons and opposed it strongly and continuously from the very beginning. Why couldn’t Russert, the White House press corps, and the mainstream media figure this out, the biggest foreign policy blunder in U..S. history?
The coverage of his death gives us a clue. B3


Click here
for the FAIR blog, Remembering Russert: What media eulogies remember–and forget.

Click here to read the Orlando Sentinel blog, The Tim Russert coverage: one of the most embarrassing chapters in television journalism.

The funk this time

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With gas prices topping four dollars in the United States this summer, Americans are educating themselves on where their fuel comes from. Often it’s from places like Nigeria’s Niger Delta, where multinational petroleum giants face armed resistance from local groups that see foreign oil developments as resource exploitation. So why are groups like Movement for the Emancipation of the Niger Delta (MEND) fighting the Nigerian government, Chevron, and Shell?

As John Ghazvinian points out in Untapped: The Scramble for Africa’s Oil (Harcourt, 2007), "In Nigeria, 80 percent of oil and gas revenue accrues to just 1 percent of the population…. Virtually everybody in the Delta scrambles to get by in shantytowns built of driftwood and corrugated zinc, watching children die of preventable diseases, while their corrupt leaders whiz past behind the tinted windows of air-conditioned BMWs."

Against this backdrop rises 25-year-old Seun Kuti, whose potent self-titled debut for Disorient Records directly addresses Nigeria’s issues. Seun is the youngest son of Fela Anikulapo Kuti, who before his death in 1997 popularized the funk-influenced West African Afrobeat sound worldwide throughout the 1970s and ’80s. Backed by his father’s 20-piece Egypt 80 orchestra, Seun invokes his dad’s fiery political rhetoric on protest songs like "Na Oil" and "African Problem" that lyrically excoriate foreign and domestic oppressors. In keeping with his father’s work, Seun’s backing music is as engaging as his commentary.

Seun Kuti is carrying Fela’s music to a new generation. But unlike his older half-brother Femi, whose recordings incorporate hip-hop and dance motifs, Seun revives Afrobeat’s original big-band blueprint and injects it with a fresh urgency. He’s helped by Fela’s longtime bandleader Baba Ani, along with Adedimeji Fagbemi (a.k.a. Showboy) on saxophone, Ajayi Adebiya on drums, and a dozen or so other Egypt 80 veterans who’ve been playing regularly for nearly three decades at the family’s Kalakuti compound.

The group stretches out on eight-minute songs like "Don’t Give That Shit to Me," where dueling guitars trade jabs, a full brass section swells mightily, and Seun Kuti adds vocal diatribes. Kuti’s sax flourishes lead the charge on that track, one of the album’s most spacious, jazz-improv-driven numbers. Similarly, blazing trumpets and speedy percussion-laden polyrhythms transform "Mosquito"<0x2009>‘s serious anti-malaria message into a rebel-dance anthem.

Kuti closes his first full-length with the punchy, mid-tempo "African Problem," which is replete with street traffic samples and the band leader’s passionate, rapid-fire lyrics. "Make you help me ask them sisters / Why no get houses to stay / Salute my brothers when they fight / Fight for the future of Africa," he sings in a militant call-and-response with the horn section. And like the campaign waged by one of Kuti’s American supporters (Barack Obama, who helped Egypt 80 get visas for a benefit show in Chicago), Kuti’s album resonates as an authentic political expression where expression and message are aligned.

SEUN KUTI AND EGYPT 80

With Sila and the Afrofunk Experience

Sun/22, 2 p.m., free

Stern Grove

Sloat and 19th Ave., SF

www.sterngrove.org

Frameline 32: Sex changes

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TAKE ONE In Iranian director Tanaz Eshagian’s Be Like Others, fear hovers over a whole nation, leading to schizophrenic behavior. By concentrating on three different individuals before and after they went through sexual reassignment operations in Iran, Eshagian reveals an incredibly sad and asphyxiating society — one where homosexuality is banned and punishable by death but changing one’s sex is legal.

No matter how progressive the act of changing one’s sex might sound, Be Like Others proves that it has conservative and oppressive connotations in Iran. Most of the people considering surgery in Eshagian’s film do so because they feel that it’s their only alternative to a gay male or lesbian identity that involves disrespect, harassment, and the possibility of a horrible death. Yet instead of finding acceptance post-operation, many are even more alienated.

The reason for this insanity, as explained by one official: being gay or a cross-dresser allegedly disrupts the “social order.” In other words, gender-bending blurs the distinctions between the sexes, making Iranian social role-assignment — largely determined by sex — a confusing task.

Mind-boggling and utterly scary, Be Like Others is a great comment on people’s obsessive need to label and compartmentalize, and a statement about our disgusting fear of anything that lacks clear delineation. At first, Eshagian’s documentary might make you feel lucky to live in a country where measures against homosexuality are not as extreme. But as it sinks in, it will make you question how far removed the situation in Iran really is from that in the United States. (Maria Komodore)

TAKE TWO At first the Iranian laws that make Tanaz Eshagian’s movie necessary seem not just cruel, but absurdly and arbitrarily so. How could homosexuality be illegal and punishable by death, while the government not only sanctions sexual-reassignment surgery but acts as its facilitator?

In Be Like Others, the answer comes from Cleric Kariminiya, a so-called Theological Expert on Transexuality, during an information session for prospective patients and their families. While Islamic law explicitly forbids homosexuality, he explains, there is no such explicit restriction on changing one’s gender.

In other words, the binary sexual politics of Iranian authority are undermined by the existence of queer citizens, whose mannerisms or predilections suggest a continuum. Eshagian’s powerful film follows a few citizens who, too visibly close to the middle of that continuum, are forced to decide between the suffering and danger of their current lot and an abrupt surgical introduction into social legitimacy.

The decision-making process these individuals face is extremely difficult viewing. Those people who successfully transition often have no other option but sex work to survive. Suicide is rampant.

Eshagian’s project is exceptional because it leaves the viewer enlighteningly confused about Iranian attitudes toward gender and law. The most fascinating character in the film is a transgender woman dedicated to the care of patients in transition. She is supportive, devoted to her patients’ well-being, and fully entrenched in the traditional Iranian views of men and women. (Jason Shamai)

BE LIKE OTHERS

Mon/23, 7 p.m., Victoria

Three Internet myths that won’t die

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› annalee@techsploitation.com

TECHSPLOITATION Since I started writing this column in 1999, I’ve seen a thousand Internet businesses rise and die. I’ve watched the Web go from a medium you access via dial-up to the medium you carry around with you on your mobile. Still, there are three myths about the Internet that refuse to kick the bucket. Let’s hope the micro-generation that comes after the Web 2.0 weenies finally puts these misleading ideas to rest.

Myth: The Internet is free.

This is my favorite Internet myth because it has literally never been true. In the very early days of the Net, the only people who went online were university students or military researchers — students got accounts via the price of tuition; the military personnel got them as part of their jobs. Once the Internet was opened to the public, people could only access it by paying fees to their Internet service providers. And let’s not even get into the facts that you have to buy a computer or pay for time on one.

I think this myth got started because pundits wanted to compare the price of publishing or mailing something on the Internet to the price of doing so using paper or the United States Postal Service. Putting a Web site on the Net is "free" only if you pretend you don’t have to pay your ISP and a Web hosting service to do it. No doubt it is cheaper than printing and distributing a magazine to thousands of people, but it’s not free. Same goes for e-mail. Sure it’s "free" to send an e-mail, but you’re still paying your ISP for Internet access to send that letter.

The poisonous part of this myth is that it sets up the false idea that the Internet removes all barriers to free expression. The Internet removes some barriers, but it erects others. You can get a few free minutes online in your local public library, maybe, and set up a Web site using a free service (if the library’s filtering software allows that). But will you be able to catch anyone’s attention if you publish under those constraints?

Myth: The Internet knows no boundaries.

Despite the Great Firewall of China, an elaborate system of Internet filters that prevent Chinese citizens from accessing Web sites not approved by the government, many people still believe the Internet is a glorious international space that can bring the whole world together. When the government of a country like Pakistan can choose to block YouTube — which it has and does — it’s impossible to say the Internet has no boundaries.

The Internet does have boundaries, and they are often drawn along national lines. Of course, closed cultures are not the only source of these boundaries. Many people living in African and South American nations have little access to the Internet, mostly due to poverty. As long as we continue to behave as if the Internet is completely international, we forget that putting something online does not make it available to the whole world. And we also forget that communications technology alone cannot undo centuries of mistrust between various regions of the world.

Myth: The Internet is full of danger.

Perhaps because the previous two myths are so powerful, many people have come to believe that the Internet is a dangerous place — sort of like the "bad" part of a city, where you’re likely to get mugged or hassled late at night. The so-called dangers of the Internet were highlighted in two recent media frenzies: the MySpace child-predator bust, in which Wired reporter Kevin Poulsen discovered that a registered sex offender was actively befriending and trolling MySpace for kids; and the harassment of Web pundit Kathy Sierra by a group of people who posted cruelly Photoshopped pictures of her, called for her death, and posted her home address.

Despite the genuine scariness represented by both these incidents, I would submit they are no less scary than what one could encounter offline in real life. In general, the Internet is a far safer place for kids and vulnerable people than almost anywhere else. As long as you don’t hand out your address to strangers, you’ve got a cushion of anonymity and protection online that you’ll never have in the real world. It’s no surprise that our myths of the Internet overestimate both its ability to bring the world together and to destroy us individually. 2

Annalee Newitz (annalee@techsploitation.com) is a surly media nerd who is biased in favor of facts.

Another shelter down

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› amanda@sfbg.com

Inside the front door of the Marian Residence for Women, a small handmade sign by a former resident advises newcomers, "Don’t compare this place to any others."

But I’ve stayed in the city-funded homeless shelters, and after a night at Marian, it’s hard not to rave about the differences. I’m given an actual bed to sleep on, with freshly laundered sheets, blankets, and a pillow. The bathrooms and showers are clean, and I’m offered every toiletry I could possibly need — as well as pajamas. Dinner is a wholesome meal of turkey, potatoes, and steamed greens — not the mystery meat on Wonder bread I received at the city’s MSC South shelter.

And unlike the tension I’ve witnessed at other shelters, the atmosphere inside Marian is close to pacific. After dinner, the 29 other women shower, read, rest on their beds, work on their laptops, or talk quietly while sitting at small tables in the common area. After my mandatory shower, I sit with an employee who explains the rules — be respectful of others, no drinking or drugs, and don’t forget to do my chore, which is assisting with dinner service. As long as I’m home by 7 p.m., I can have my bed as long as I need it.

That is, she clarifies, until the end of August — when they’re closing the shelter. For good.

Marian is a casualty of a plan by St. Anthony Foundation to cut $3 million from the foundation’s operating budget. In addition to closing the $1.2 million Marian facility, which houses 30 women in the emergency shelter and 27 in a transitional program, St. Anthony also will shutter its 315-acre organic dairy farm in Petaluma, currently used as a rehabilitation program for homeless addicts. Its Senior Outreach and Social Services [SOSS] is also losing staff and office space as it consolidates with the Social Work Center.

Five of the foundation’s 11 programs face cuts, the result of a two-year sustainability study that St. Anthony’s executive director, Father John Hardin, said will keep the charity out of a fiscal tailspin.

"We’re not in a financial crisis," he told the Guardian. "The reason we’re doing this is so we won’t be in a financial crisis."

He said the closures reflect the organization’s desire to get back to basics.

But, as one of the 40 soon-to-be-laid-off employees said, "They’ve said they want to refocus on basic services, but I see shelter as a basic service."

St. Anthony receives no city money for the work it does, but the closures are occurring in what’s already a war zone of budget cuts for social services in San Francisco. The loss of any of St. Anthony’s programs affects the city as a whole.

"Are we concerned? Yes," said Dave Knego of Curry Senior Services, which frequently refers seniors the group can’t help to St. Anthony’s SOSS program. "Unfortunately, we already have a waiting list, and the city’s cutting our funding back by 10 percent."

The closure of Marian is yet another sign of the slow erosion of shelter space in San Francisco. Since July 2004, 364 shelter spots have disappeared. By the end of August, Marian’s 57 beds and Ella Hill Hutch’s 100 mats will be gone as well. "You can’t afford to lose 57 beds, especially in a place where women are being treated like human beings," said Western Regional Advocacy Project’s Paul Boden, who’s worked with homeless services in the city since the 1980s. "What I thought was really ironic was there wasn’t any attempt to build a community effort to discuss how to save this facility. These beds are an incredibly important community resource."

Some of the women who live in the transitional program at Marian wanted to rally and save the shelter. "First and foremost was to try to save Marian Residence for Women," said Leticia Hernandez, a two-year resident of the transitional program who still hasn’t lined up a place to go when the shelter closes. "Even if we couldn’t save it, we thought it was still worth a try because any money that would come would go back to them." The women drafted a letter asking for help, which they’d hoped management would distribute to the press and public.

The foundation, Hernandez said, had a "thanks, but no thanks" response.

Hardin told us that St. Anthony’s wasn’t facing a financial crisis, so "we’re not going to get up and cry wolf. We want to go back to some of the basics. We’re turning people away from the clinic," he pointed out.

He agreed that shelter was a basic service, but said, "We can’t do it all."

The foundation wouldn’t detail its intentions for the building once it’s vacated Aug. 31, beyond affirming that it would be rented. "That’s going to be an income generator," said foundation spokesperson Francis Aviani. "We are hoping to get a social service agency to use the space in the way it’s designed for, helping folks."

Multiple St. Anthony employees said they were told the facility would be used for medical respite — beds set aside for people who aren’t in critical condition, but are too ill or fragile to mingle with the general population and have nowhere else to go — and a St. Anthony board member confirmed that was the only plan presented to the board.

Marc Trotz, director of the San Francisco Department of Public Health’s Housing and Urban Health division, which oversees its $2.5 million, 60-bed medical respite program currently housed in two facilities, told us the city is looking for a new respite site. He confirmed that the Marian building is a facility the agency has seriously considered. "We’re not looking to push one program out in favor of another or anything like that." But, he said, "It’s a potential site that would work well."

While St. Anthony is cutting $3 million in programs, foundation staffers have been working for several years on a $22 million capital campaign for a new administrative building at 150 Golden Gate Ave. The building will replace a facility at 121 Golden Gate, where offices, the clinic, an employment center, and a dining room are currently housed. The popular dining room — which serves 2,600 meals a day — will ultimately move back to 121 Golden Gate after the building is razed and rebuilt to meet modern earthquake safety standards. The project is part of another $20 million campaign that includes a partnership with Mercy Housing to build affordable rentals on the upper floors.

St. Anthony staffers say the types of donors who will contribute to a new building are very different from those who will fund ongoing programs.

Meanwhile, food costs in the dining room have increased 18 percent in the last three months, and St. Anthony staffers expect another 25 percent increase during the coming quarter. At the same time, other free food programs in the city have closed, which means St. Anthony is seeing new faces in the dining room.

Aviani confirmed that donations have increased 8 percent to 10 percent, but the group receives very few "unrestricted" funds. Most of the money is earmarked for the dining room. In a way, she said, "that’s the community deciding what they want."

A third of the organization’s $19.7 million budget comes from bequests — a form of donation that has waxed and waned in recent years. According to Aviani, the foundation has yet to receive a single bequest this year.

The group has increased grants and deployed new fundraising methods, but she said that "The amount of grants out there for shelters and women’s programs are few and far between." She acknowledged that shelters are needed, and said St. Anthony has been "pretty outspoken about that."

The foundation has kept a tight lid on talk about the closures. None of the employees contacted by the Guardian would speak on the record — for fear, they said, of losing their severance packages.

Aviani said severance packages — which include pay and personal job coaching — are not on the line. "We asked them not to create a gossip chain, to stay focused on their work, and when people have questions, direct them to me. We didn’t say they couldn’t talk to anyone at all. That wasn’t the message at all."

Whether or not the gag order was intentional, it has had an effect and created suspicion about the foundation’s true intentions.

Even the city deferred to the organization when questioned about the potential plan to rent the Marian building and use it as a medical respite facility. "We’re not going to talk about that," said DPH spokesperson Eileen Shields. "We’re going to let St. Anthony talk about that at this point because it’s St. Anthony’s call."

On Feb. 14, Newsom — who has said shelters don’t solve homelessness — announced he would like to redesign the city’s shelters and called on the community to come up with suggestions. One of his specific suggestions was to create more medical respite centers.

In May, the Local Homeless Coordinating Board, which is chaired by Hardin, released a report outlining a number of detailed suggestions for improving city-funded shelters and services. It specifically stated that shelter beds shouldn’t be sacrificed to make room for respite.

The Mayor’s Office has yet to formally respond to the report, but at the June 2 LHCB meeting, Kayhan said there were a few things he felt confident the mayor would endorse.

"We heard loud and clear: more senior beds," Kayhan said. "And I’ll add to that women’s beds." He said that respite care would be "moving and co-locating with another location. We think that could free up space at one of the shelters." And, he added, that space could be allocated to women or seniors.

Which makes it sound like more beds for women and seniors are in the works — but considering the elimination of Marian and a shelter at Ella Hill Hutch Community Center, the city is still looking at a net loss of places for the homeless to sleep at night.

Board member Laura Guzman, who runs the Mission Neighborhood Resource Center, said she heard Hardin announce the Marian closure at a May 5 meeting. "He said it was a very difficult decision. I believe he said we’re going to try to open some medical respite beds," Guzman said. "All along we’ve said we don’t want to replace shelter with medical respite beds, but that’s exactly what’s happening."

Shuttering Marian is just one more loss in an environment of dwindling resources for women. Buster’s Place, the only 24-hour drop-in center for men and women, closed in March, and was replaced by a smaller facility that only allows men.

Five of the city’s other shelters have sections for women, but one of them is slated to close as well and none can offer a women-only safe space like Marian. A Woman’s Place is the only other all-female facility, and its 15 mats on the floor are always full. "With Marian closing, there’s going to be more of a demand on the total system," said Janet Goy, executive director of Community Awareness and Training Services, which runs A Woman’s Place. "It’s a loss, no question."

Emily Murase of the Commission on the Status of Women said it’s difficult to accurately count homeless women because women tend to take more measures than men to stay off the streets, though they may not necessarily be safely housed. Women are more prone to couch-surf, stay in abusive relationships, or settle for some other kind of compromised situation.

Murase’s group now funds a special women-only program at Glide Memorial Church, whose director, Willa Seldon, said, "We’re certainly seeing an increase in volume of women in the city to our programs. In October, we were seeing 11 in our support groups. That increased to 18 by March. It could definitely be related to Buster’s Place closing."

Hardin acknowledged the need for women’s shelters but said the city ought to take on the burden. "Maybe closing the Marian is a tipping point," he said. "As I said in front of the Board of Supervisors, it’s the government’s responsibility to provide the safety net. We’re the hands beneath the safety net."

Sandy Van Dusen has been living in the transitional program for a year and a half since her husband was murdered. She’s been told that she is about to get a studio apartment. She’s visibly excited about the move, and grateful to the foundation. But, she says, she’s still been crying every day since she heard Marian is closing. "They saved my life," she says, crying a little now. "They’re doing what they told me to never do — throw in the towel."

*

A heart once nourished

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› gwschulz@sfbg.com

Community court, every second Thursday at 10 a.m. Narcotics Anonymous on Wednesday. Apprenticeships for construction workers, Monday, bright and early.

The ancient letter board just inside the entrance of the Ella Hill Hutch Community Center tells much of the story of this neighborhood institution. Since 1981 it’s been a crucial hub for the Western Addition, a mostly level stretch of terrain west of downtown that rivals the Mission District and Bayview–Hunters Point as the source of the most despair from senseless gun violence.

For decades Ella Hill was a safe haven, a place where kids and seniors felt comfortable, where people could learn and teach and talk and work together, a little oasis in the world of urban hurt.

A placard affixed to one wall of the entryway honors Thurgood Marshall, the nation’s first African American US Supreme Court justice. In a small office nearby, a tutor assists a young girl with the multiplication table. Elsewhere, a list of rules forbids profanity, play-fighting, and put-downs.

There’s also a poster of Ella Hill Hutch, the first black woman elected to San Francisco’s Board of Supervisors, where she served from 1978-81.

But in 2006, a man was murdered during daylight hours in the center’s gymnasium before dozens of witnesses. That slaying was one of at least five brutal incidents that took place in the shadow of Ella Hill between 2006 and 2007; three more murders occurred within blocks. Many remain open cases today.

And now the center is having serious problems — troubles that reflect those of the city’s African American population, which has been plagued by violence and socioeconomic changes that are closing opportunities and forcing longtime residents out the city.

Several census tracts in the neighborhood that at one time contained between 3,000 and 6,000 black residents are down to 1,000 or far less, according to a San Francisco State University study commissioned by the city last year. The report showed that between 1995 and 2000 San Francisco lost more of its black population than 18 other major US cities.

Ironically, the city is now preparing to close the final dark chapter on 50 years of federally subsidized redevelopment in the Western Addition. But the displacement that the bulldozers set off half a century ago continues today, unabated.

That exodus has compounded structural problems at the center just when its remaining clients need it most. The nonprofit late last year underwent an organizational shake up and brief takeover by the Mayor’s Office to save it from imminent financial collapse. The center’s executive director of two years, George Smith III, was fired with little public explanation last year, and a permanent head was named only recently.

As with many aspects of this troubled community, it was unaddressed violence that fed the fire. Simply subsisting in the heart of a violent neighborhood was strain enough for Ella Hill. But suffering an attack from within seemed too much to bear for an institution some call "San Francisco’s Black City Hall."

The 2006 killing took one man’s life, but Ella Hill itself — still facing an uncertain financial future — felt the searing rounds too. Now some wonder if the nonprofit can survive the very violence and poverty it was created to help end in a neighborhood that’s changing forever.

In Ella Hill’s noisy gymnasium at the building’s east end, two teams of middle schoolers practice basketball.

"My job is to be in the best position to box him out for a rebound," their coach says as they crowd around the free throw line.

The kids are radiant and attentive now. But from this same basketball court on April 27, 2006, the Western Addition briefly edged ahead of the rest of the city in extreme bloodshed.

Donte White, 22, was working part-time at the center. As he supervised a basketball game, two unidentified males entered Ella Hill. One brandished a firearm and shot White at least eight times in the face, neck, and chest as several kids looked on in utter horror. Among them was White’s young daughter.

Police arrested 25-year-old Esau Ferdinand for the attack five months after White’s murder. But within two weeks prosecutors decided they could no longer hold him and declined to press charges when a key witness disappeared on the eve of grand jury proceedings.

Even with other witnesses filling the gym, police gathered few additional leads, an all-too-common story in a neighborhood where residents often prefer to avoid both law enforcement and vengeful criminal suspects.

The center installed cameras and an alarm. A buzzer was placed on the front door. But the new security measures cut against Ella Hill’s image as a demilitarized zone, and the center remains shaken by White’s murder. Some parents began barring their children from going there.

"Can you imagine something like that, someone coming into a rec center in the middle of the day with a firearm and shooting and killing a guy?" asks Deven Richardson, who resigned from Ella Hill’s board in 2007 to focus on his real estate business. "That really set us back big time in terms of morale. It really was a dark moment for the center."

Sup. Ross Mirkarimi, whose district includes Ella Hill, says that after he took office in 2004, he learned that the police weren’t stationed at the center during prime hours and had never created a strategy for attaching themselves to the center the way they had at other safe-haven institutions in the city, like schools. He told us he’s had to "really work" to get the nearby Northern Station more integrated into Ella Hill.

"Before the murder of Donte White, there had also been a series of incidences inside Ella Hill Hutch," Mirkarimi said over drinks at a Hayes Valley bar. "Nothing that resulted in anybody getting killed, but certainly enough indicators that really should have been taken more seriously by the mayor."

In June 2006, shortly after White’s shooting, the San Francisco Police Commission and the Board of Supervisors held a tense public meeting at the center. Residents, enraged over the wave of violence that summer in the Western Addition, shouted down public officials, including Chief Heather Fong, who was forced to cut short a presentation on the city’s crime rate.

That same month, the supervisors put a measure on the ballot to allocate $30 million over three years for violence-prevention efforts like ex-offender services and witness relocation. But Mayor Gavin Newsom, following a policy of fortifying law enforcement over community-based alternatives, opposed the measure because it excluded the police department. Prop. A, designed to finance groups like Ella Hill with connections to the neighborhood that the police will never have, lost by less than a single percentage point.

Meanwhile, four homicides in the neighborhood that year joined frequent anarchic shootouts in the Western Addition, including many that never made headlines because no one was killed. The fatalities led to promises by City Hall that the area would be saturated with improved security, including additional security cameras that have mostly proved useless in helping the police solve violent crimes.

On June 3, 2006, 19-year-old Antoine Green was standing on McAllister Street near Ella Hill early in the morning when he was shot to death in the head and back. On Aug. 16, 38-year-old Johnny Jackson’s chest was filled with bullets as he sat in the front seat of a Honda Passport on Turk Street not far behind Ella Hill. A woman next to him in the car suffered a critical gunshot wound to the head.

Two more killings occurred further east at Larch Way, a popular location for murder in the neighborhood.

Burnett "Booski" Raven, a 32-year-old alleged member of the Eddy Rock street gang, was found bleeding at 618 Larch Way early Oct. 7, his body laying halfway in the street and containing at least 10 gunshot wounds. On July 22, police found 23-year-old John Brown, another purported Eddy Rock member, wedged under a Chevy pickup truck, dead from up to seven gunshots.

Brown had reportedly survived two prior shootings, but the Western Addition’s cultural condemnation of "snitching" to police has so infected the neighborhood that he allegedly told police not to bother investigating either of the attacks.

Loïc Wacquant, a sociology professor at the University of California, Berkeley, says neighborhoods like the Western Addition that once contained stable black institutions — schools, churches, and community centers that glued residents together — have been overwhelmed by the rise of a white-collar, service-based economy, the decline of unions, and the withdrawal of meaningful social safety nets.

Cities have responded to the resulting marginalization with more police officers, more courts, and more prisons. But the failure of those institutions to cure rising violence "serves as the justification for [their] continued expansion," Wacquant quoted Michel Foucault, the famous late UC Berkeley sociologist, in the academic journal Thesis Eleven earlier this year.

The roots of the Western Addition’s tragedy go back to the early post-World War II era. In 1949, Congress enacted laws giving cities extraordinary powers to clear out land defined as "blighted." In San Francisco, that meant neighborhoods where low income people of color lived.

The Western Addition was devastated. Huge blocks of houses were bulldozed. Clubs, stores, restaurants — the heart of the black neighborhood — were wiped out. Many residents were forced out of the neighborhood and sometimes the city forever; others lost their property and their livelihoods (see "A half-century of lies," 3/21/2007).

By the 1970s, neighborhood activists were hoping that at the very least the Redevelopment Agency would pay for a recreation facility for kids. But city officials wouldn’t put up the money, recalls the Rev. Arnold Townsend, a longtime political fixture in the city and associate pastor of the Rhema Word Christian Fellowship.

Townsend said activist Mary Rogers — whom he calls "the greatest champion kids ever had in this community" and a famous critic of redevelopment — gave up on City Hall and went to Washington DC, where she sat in at a meeting that happened to include Patricia Harris, Secretary of the Department of Housing and Urban Development under President Jimmy Carter. Rogers, joined by a group of colleagues from San Francisco, bumped into Harris afterward.

"[Harris] shook Mary’s hand like politicians do, and Mary wouldn’t let her hand go until she had a meeting," Townsend said. "They were having a tug-of-war over her hand."

Rogers’ determination paid off, and enough political channels opened up that money for the center became available. Then-Mayor Dianne Feinstein cut the ribbon for the $2.3 million Ella Hill Hutch Community Center four months after the supervisor’s death, complete with outdoor seating for seniors, a gymnasium, tennis courts, and child-care facilities.

A young counselor named Leonard "Lefty" Gordon who worked at the Booker T. Washington Community Service Center, one of the city’s oldest black institutions — it was founded in 1919 on Presidio Avenue, where it remains today — was named executive director of Ella Hill three years later and led the center to wide acclaim for 17 years.

A recreation coordinator at Ella Hill started a reading program for young athletes after discovering that a local high school football star wasn’t aware he’d been named the city’s player of the year: the teenaged boy couldn’t read the newspaper to find out. Other programs for tutoring and job training targeting young and old residents were likewise started under Gordon.

Many of the people we interviewed recalled the "kitchen cabinet" meetings convened by Lefty Gordon at Ella Hill as among their fondest memories. Everyone from the "gangbangers to police" attended Gordon’s meetings, Townsend said, and made them a repository of complaints about what was happening in the neighborhood.

Alphonso Pines, a former Ella Hill board member and organizer for the Unite Here! Local 2 union, eagerly showed up at the meetings for months after attending 1995’s Million Man March in Washington.

"I hate to see brothers die, regardless of whether it’s at Ella Hill," Pines said of Donte White’s 2006 killing. "But that was personal for me, because that was the place where I had sat on the board for years. That was real shocking."

Lefty’s son, Greg Gordon, said that his legendary father — who died of a heart attack in May of 2000 — worked so hard for the center that he allowed his own health to deteriorate.

Most beneficiaries of Ella Hill’s social services now live in the southeast section of the 94115 ZIP code, roughly bordered by McAllister and Geary streets to the south and north, and Divisadero and Laguna streets to the west and east.

The majority of Ella Hill’s approximately $1.4 million annual budget comes from government sources, either through grants or nonprofit contracts.

Newsom, through his community development and housing offices, has given $860,000 over the past three years to Ella Hill to help job-ready applicants obtain construction work and other general employment in the neighborhood. The center launched its JOBZ program in 2006, targeting formerly incarcerated young adults and others with a "hard-to-employ" status.

Caseworkers must convince some participants to leave gangs, deal with outstanding warrants, pay back child support, expunge criminal records, or eliminate new offenses, all of which can exacerbate a desire to give up. Sometimes the center has to buy people alarm clocks.

"None of these other programs that are being funded in this community want to deal with the kinds of kids or people who come to Ella Hill…. [It] is the last stop for everybody," said London Breed, head of the African American Art and Culture Complex on Fulton Street and a Western Addition native. "That’s where people go who have no place else to go, which is why it’s so important."

Most nonprofits working for the city must regularly report their operational costs or show how program funds are being spent on graduation ceremonies and trips to university campuses. The required forms are mind-numbingly bureaucratic and reveal little about what a place like Ella Hill might face on a practical level each day. But last year, former executive director George Smith betrayed a crack in Ella Hill’s veneer.

"Once again violence has impacted the community with three incidents in close proximity to the complex this month alone," he wrote to the San Francisco Department of Children, Youth and Their Families, which supports the center with college preparation grants. "One of the victims was a young man scheduled to graduate from high school in June."

On May 25, 2007, 19-year-old Jamar Lake was leaving a store on Laguna and Eddy streets, northeast of Ella Hill, when a teen suspect opened fire on him. Paramedics were so worried about security in the neighborhood that they fled before attempting resuscitation, according to a report from the San Francisco Medical Examiner. Lake died at General Hospital that day.

Weeks later, a manic 12-hour long feud erupted between several gunmen on McAllister Street. Seven people were wounded during two daytime shootings that took place in the Friendship Village Apartments, across the street from Ella Hill.

Then in July, a suspect randomly and fatally stabbed 54-year-old Kenneth Taylor in the neck as he sat on a park bench near sundown at Turk and Fillmore streets, within easy view of the SFPD’s Northern Station. Police didn’t respond until Taylor stumbled to the sidewalk and collapsed; a witness had to flag down a patrol car.

Following the Lake shooting, the mayor and police department promised, as they had the year before, that foot patrols would be increased in the 193-unit Plaza East Housing Development and other public housing projects in the Western Addition.

But the city’s most visible response has bypassed Ella Hill — which has some street credibility — altogether. Instead, City Attorney Dennis Herrera went to court to get injunctions against street gangs in June 2007.

Herrera’s initial filing came days after the wild shootout on McAllister Street, but the timing was coincidental. The city attorney also had been preparing injunctions against gangs in the Mission and Bayview-Hunter’s Point for months. For the Western Addition, the city attorney noted a "recent rise in violent crimes perpetrated by the defendants," and asked that the members of three gangs be banned from associating with one another inside two "safety zones" marked along the contours of their respective territories, a 14-square-block area that straddles Fillmore Street and rests just north of Ella Hill.

"The conditions within the two safety zones have become particularly intolerable in 2007 as the deadly rivalry between the Uptown alliance and defendant Eddy Rock has intensified," Herrera’s office told the court. "In 2007 alone, this rivalry is the suspected cause of at least three homicides and numerous shootings within the two safety zones."

Some critics viewed barring people from congregating with one another a civil rights violation. And worse, they feared it would merely shove more African Americans and Latinos out of the Western Addition, which would benefit the city’s wealthiest white residents.

"All of this stuff about gang injunctions is a bunch of malarkey," said Franzo King, archbishop of the Saint John Coltrane African Orthodox Church on Fillmore Street. "You don’t really have gangs here…. [In San Francisco] they’re a big club."

Herrera nonetheless convinced a Superior Court judge to issue the injunctions after filing 1,200 pages of evidence arguing that the three "clubs," which include only about 65 people named by the city, are endless public nuisances and force organizations like Ella Hill to battle with them for the affections of Western Addition youth.

Police admit that the injunctions since last year have, in fact, led people to simply leave the neighborhood. Still, they insist the injunctions have reduced trouble in the Western Addition. The Knock Out Posse, for instance, is evaporating, they say.

Paris Moffett, a 30-year-old alleged Eddy Rock leader, told the Guardian in a separate story on the gang injunctions last November that he and others were organizing to quell violence in the neighborhood and would do so in defiance of the gang injunctions (see "Defying the injunction," 11/28/07).

But on the day that story ran, Moffett hampered his new cause when, according to a March 27 federal indictment, police arrested him in Novato for possessing a large quantity of crack and MDMA, as well as a Colt .45 semiautomatic.

After Lefty Gordon died, the center went through a couple of directors in relatively short order. Robert Hector, a second-in-command to Lefty Gordon, helmed the center briefly; he was replaced with George Smith III, who left in 2007.

Meanwhile, problems at Ella Hill grew.

"The seniors just stopped their participation," Anita Grier, a former Ella Hill board member who first ran for the San Francisco City College Board of Trustees in 1998 at Gordon’s encouragement, told us. "Things were never excellent, but they just got much worse once [Gordon] was no longer director."

The center, a standalone nonprofit, had long struggled financially in part because it relied so much on contracts and grants from the city rather than pursuing funds from private donors. Mirkarimi says Ella Hill’s structure is unlike any other community center in the city. Many other centers are directly maintained by the San Francisco Recreation and Park Department.

Contract revenue from one Ella Hill program, such as providing emergency shelter to the homeless, was often diverted to keep another on life support or to simply cover the center’s utility bills.

By early 2007, the center faced a financial catastrophe. Donald Frazier joined Ella Hill’s board as president in January 2007 and embarked on a reform effort to turn the center around. He commissioned what came to be a blistering audit that revealed the nonprofit owed over $200,000 in state and federal payroll taxes. As a result, the center faced $63,000 more in penalties and accrued interest.

Mirkarimi blames community leaders in his district for refusing to acknowledge a crisis at the center and for not turning to City Hall for help when Ella Hill appeared to be slowly rotting from the inside out.

The mayor’s staff, he adds, wanted to believe Ella Hill was working on its own and should’ve continued to do so because, despite its financial reliance on the city, it was technically an independent nonprofit. In reality, Mirkarimi said, "They were afraid to piss off black people, is what it comes down to. They were afraid to tell it like it is — that things weren’t working."

Sending delinquent invoices to the city, failing to institute reasonable accounting standards, and falling far behind on its payroll taxes all threatened the government contracts and grants that kept San Francisco’s Black City Hall afloat. By extension, the audit concluded, that meant Western Addition residents who relied on Ella Hill were "victimized" by the center’s improper use of its limited resources.

Aside from the audit, which Ella Hill instigated itself, there’s no indication in the records of agencies funding the center that any problems were occurring, which implies the city wasn’t paying attention.

"As far as I’m concerned," Mirkarimi said, "we had a renegade institution, and the only reason it wasn’t renegade in an illegal sense was because the lease allowed them to have a parallel governance structure. But it was renegade in the sense that the city neglected to supervise properly."

In November 2007, just after residents hijacked a chaotic board meeting with an extended public comment period, Frazier told the directors in closed session that the Redevelopment Agency was planning to restrict future funding for the center due to its management problems.

One month later, the mayor dispatched an aide, Dwayne Jones, along with redevelopment agency director Fred Blackwell, to a meeting at Ella Hill with an ultimatum. Jones told the assembled that new interim appointees would be taking over the center’s bank books, recreating its bylaws, and electing a new board and executive director. The old board would essentially be dissolved. According to observers at the meeting, Jones told them that if they resisted the plan, funds received by Ella Hill from various city agencies would be jeopardized, as would its low-cost lease of city property.

Two defiant board members viewed the move as a "hostile takeover" of a private nonprofit organization by the mayor and voted against it, but the rest of the board agreed to the restructuring. Mirkarimi says there was simply no alternative.

"Right now it needs to be shrunk to what it can do really well, instead of doing what they had to do in the last five years, an incremental sloppy way of programming," he said.

The interim board in April named a former Ella Hill employee and Park and Rec administrator, Howard Smith — unrelated to George Smith — to be the center’s new executive director. But after all the changes Ella Hill made to fix its leadership problems, there are no assurances the city won’t leave Ella Hill without the money it needs to keep the doors open next year.

It’s noon on a recent Friday and Ella Hill’s new executive director is scrambling to keep things together. An employee wants him to glance at a form. Another man wants to come in and play basketball. Smith has a board meeting minutes from now, but he’s scheduled an interview with the Guardian at the same time.

Smith’s a well-built man dressed in a pressed suit, polished shoes, and a sharply-knotted tie. He’d mostly avoided our calls for weeks. Word spread in the neighborhood that the Guardian was planning some sort of hit piece on Ella Hill.

But it won’t be a newspaper that capsizes the center.

A significant portion of the center’s funding will be threatened over the next year. The redevelopment agency is scheduled to end its 45-year reign in the Western Addition by then, a blessing of sorts since so many people in the neighborhood feel it’s done nothing but upend the lives of black residents. But the end of the agency means that redevelopment funds for Ella Hill’s job placement programs, about $400,000 annually, will disappear.

In addition, about $300,000 more a year will dry up since the San Francisco Human Services Agency hasn’t renewed an emergency homeless shelter contract with the center. Mirkarimi believes the mayor, too, will try to stop providing Ella Hill with funding through his community development office next year.

If Newsom does back away, Mirkarimi warns, there will be "a very loud showdown."

"What I’m worried about is that the Newsom administration is basically cutting and running on this, and I’m not going to allow that to happen, at least not without a fight," he said.

The alternative is for Rec and Park to take over managing Ella Hill’s facilities with DCYF continuing to fund youth programs there while the Redevelopment Agency commits community benefits dollars from a legacy fund to the center — the least it can do after a half-century of transforming the neighborhood, locals be damned.

An interagency council made up of the center’s primary funders could collectively watchdog its performance, Mirkarimi says. Once Ella Hill’s leaders prove that the center has fully returned to its original mission, it can consider expanding to serve other populations in the neighborhood, or even seek a plan to detach further from the city.

The mayor’s spokesperson, Nathan Ballard, did not respond to an e-mail containing detailed questions, and his aide, Dwayne Jones, did not return several phone calls. But Smith said during a later lunch interview at the Fillmore Café that he agrees with Mirkarimi’s idea.

"There are so many programs out there that say they’re doing something on paper, but they’re really not doing it," Smith said. "They’re running ghost programs. So what I’ve been saying at Ella Hill since I got there is, ‘We will do exactly what we said we were going to do.’<0x2009>"

In the meantime, Smith is determined to prove that Ella Hill’s history has only just begun. The mural of Lefty Gordon outside the center received a fresh coat of paint recently, and the color pops. The sidewalk is being repaved and new handrails installed. The walls inside are clear of the aging posters and letter board that hung there a few months ago.

Before heading off to his board meeting, Smith teasingly asks an adolescent boy meandering in the center’s entryway for 75 cents. The boy’s always hitting him up for pocket change.

"I don’t got any," the boy responds.

"You don’t have any," Smith corrects.

Smith suddenly realizes what time it is.

"Hey, why isn’t this guy in school?" he wonders aloud.

At that moment, only the Ella Hill Hutch Community Center was asking the question. *

CFAC: Opening up China’s Great Firewall

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By Bruce B. Brugmann

The California First Amendment Coalition (CFAC), a free press advocacy group, is testifying before a congressional commission in Washington on Wednesday, June 18, on the Chinese government’s system of internet censorship.
The testimony by Gilbert Kaplan, a free trade
law expert in Washington, is a key part of CFAC’s campaign contesting China’s censorship of many U.S.-based and other western websites that are deemed offensive by Chinese government censors. Here is CFAC’s press release explaining the campaign and the issue:

Continue reading for press release.

Genetically modified mouthpieces

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OPINION In 2003, when I was working as an anchor for a San Francisco television station, newscasters and reporters across the country were asked by the White House to refer to the Iraqi invasion as Operation Iraqi Freedom (OIF). We were asked to call the war in Afghanistan Operation Enduring Freedom (OEF).

With press releases in hand, journalists repeated genetically modified words as if their DNA depended upon it.

Genetically modified language is when propaganda wins, journalism sells out, and the public loses. It’s when words are twisted and massaged and spun until an entire suit of lies is woven to cover the guilty and cloak the truth.

The genetically modified language, in the case of Iraq, was full of false bravado and moral superiority, wielded in attempts to turn lies into honorable causes our dear children were willing to go to war for.

Nothing caught on like the phrase "the war on terror." It was a White House propaganda bonanza. Whole networks built their news around swirling "war on terror" graphics and anchors began stories with "Today in the war on terror," while most of the world considered Americans the terrorists.

That’s when I pulled up lame and refused to dance the destructive dance. Most of us who complained are now gone.

The fourth estate, as the media is called, was created to watch the government and anyone else using lies to gain power and profit at the expense of the safety and security of the American people

Thinking journalists can now see that using the White House’s genetically modified language with unquestioning devotion is one of the many reasons why we lost the public trust five years ago.

I propose that journalists stop repeating genetically modified White House language, and go a step further.

On the very day it was leaked that Scott McClellan’s book reveals the country went to war based on known lies, the sweetest, shiniest, dimple-faced, airbrushed Bay Area Murdoch girl began a broadcast by announcing: "Another American has given his life for his country today."

I was once that girl. Today I know that soldier was one of thousands who bravely believed in what the president said — and died believing a lie the press helped promote.

What if this anchorwoman — and hundreds of others like her, all of whom I imagine to be nice people — read instead: "Another American has died in Iraq today. He was a beloved brother and child, and he was number 4,084."

Then perhaps follow that with the number of wounded Iraqi veterans: 30,329.

In an attempt at truly unbiased journalism, they could end with the number of Iraqis who have lost their lives: 1,217,892.

If this war, as McClellan says and dozens of other experts have pointed out, was based on a great lie, let’s honor those soldiers who were willing to believe the lie by bringing them home alive. Let’s stop repeating genetically modified words that glorify a conflict American journalists could have helped prevent by putting their pom-poms down.

Leslie Griffith

Leslie Griffith is a writer, award-winning television reporter and former KTVU news anchor. You can find more of her work at lesliegriffith.org.

It’s pronouced “Oo-vuh:” Uwe Boll, Part Two

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Postal is now playing at the Roxie — and will be there until Wed, June 11. It hasn’t exactly been taking the critical world by storm, but I enjoyed it, more or less. Still deciding? Read on for part two of my interview with director Uwe Boll and cast members Zach Ward and Larry Thomas.

San Francisco Bay Guardian: Do you think the fact that Postal makes light of terrorists and 9/11 will be a turn-off for audiences who would otherwise be into watching an over-the-top comedy?

Zach Ward: Why? I mean, why would you not make fun of terrorists? That’s like saying you can’t make fun of Nazis, or drug dealers. They’re douchebags. Terrorists are douchebags. Are you gonna sit underneath your chair and be worried about their opinion of you? I’ve been told that other actors turned [my] part down because they were scared of the controversy. If I’m gonna live my life in fear, I’m not living my life. If you’re gonna let a person in a foreign land with their own sets of values decide what you do on a daily basis, you might as well move there. South Park did this too — the price of freedom is eternal vigilance. Get off your fat fuckin’ ass and stand for something. You can’t have it both ways. You can’t be the home of the free and then turn around and say, “Oh, we can’t do the Mohammed joke, because then the Islamic fundamentalists will be upset.” Well, fuck yourself. If you’re an Islamic fundamentalist, you’re not supposed to be watching fuckin’ TV in the first place, so you can kiss my rosy red freckled ass. And if I’m supposed to sit here and apologize to you, you need to be in my house. This is my country. I’m not gonna kowtow to another opinion. This is where the government is supposed to be afraid of us, we’re not supposed to be afraid of the government. We’re supposed to stand up and create this country around our ideals, not by what Viacom thinks. Not by integrated vertical corporate fuckin’ structure. No, that’s ridiculous. And the fact that we’ve gotten to the point where we have to defend that? That’s what made America great.

Beyond the budget spin

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OPINION Local government is frozen. The mayor’s office and the Board of Supervisors have been engaged in open warfare for months. This week, Mayor Gavin Newsom announced that in order to balance San Francisco’s budget, city services and community-based organizations will have to undergo draconian cuts.

In a preemptive move against embarrassing protests, the mayor’s press office did not reveal the location of the annual budget presentation to the news media until late Friday afternoon. Even the supervisors, who will be debating and voting on the budget during the month of June, were left in the dark until then.

While the mayor didn’t blame city workers for the financial crisis, he did suggest that Service Employees International Union Local 1021, which represents the low-wage, frontline, service-providing city workers, should "help out."

Well, we have. SEIU members stepped up to "help out" in fiscal years 2003–04 and 2004–05 by agreeing to wage freezes and self-funding our pensions. All the recent midyear cuts were in public health agencies and among SEIU-represented nonprofits.

Most recently we stepped up by helping draft and vigorously campaigning to pass Proposition B, which freezes city workers wages for two years and tightens eligibility for retiree health care benefits in exchange for a modest increase in city pension benefits.

The mayor’s budget director repeatedly has said that this is a spending problem, not a revenue problem. Talk about spin.

Moreover, in his June 2 budget presentation, the mayor made no mention of raising revenue as an answer to our fiscal problems. You could almost hear Gov. Schwarzenegger’s voice as Newsom presented a slash-services budget with a "no-new-taxes" slogan waiting in the wings for his next campaign.

Everyone knows it’s expensive to live in San Francisco. Paying city employees a wage that allows them to stay in the community they serve isn’t a budget "problem." It ought to be a basic part of what City Hall does and cares about. And if that means looking at bringing in new sources of money, we should have that conversation.

We believe there are various revenue sources that make more sense to explore than some of these service cuts, including a real estate transfer tax increase for high-level properties.

Fortunately, the mayor’s proposal is just a starting point. Soon we will be proposing specific alternatives.

Toward that end, the San Francisco Human Services Network and Coleman Advocates for Children and Youth have organized a citywide forum on the mayor’s proposed budget cuts. SEIU 1021 is cosponsoring this event. The San Francisco budget and revenue town-hall meeting will be held June 9 from 2-4 p.m. in the San Francisco Main Library’s Koret Auditorium, 100 Larkin (at Grove)

Don’t get angry. Get organized.

Robert Haaland

Robert Haaland is a longtime San Francisco activist who works for Local 1021.