Public Power

Public power football

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By Tim Redmond

The City of Santa Clara has a lot that the San Francisco 49ers find attractive: A nice site for a stadium, a local fan base — and, it turns out, $200 million in cash. That money, which the team has its eyes on, is sitting in the bank — it’s the surplus from the city’s municipal electric utility.

Isn’t it funny: San Francisco may lose a football team in part because our competing city did what we should have done many years ago, and created a public-power agency. Now it’s got some money to spare.

This all came up at Mayor Gavin Newsom’s weekly department heads meeting March 18. when a mayoral staffer gave a briefing on the Santa Clara 49ers situation, including an explanation of how the Niners want that $200 mill (which the Santa Clara power agency is reluctant to part with). In the middle of the briefing, Sheriff Mike Hennessey dared to interrupt with the obvious question:

“Are you saying,” he asked, “that a city can make a profit from public power?”

The staffer’s response: “No comment.”

Abolish PG&E Corp.

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OPINION Pacific Gas and Electric Corp. is a holding company whose only property is Pacific Gas and Electric Co., a regulated utility. The California Public Utilities Commission (CPUC) exercises little regulatory oversight over PG&E Corp. Oversight by federal authorities has been curbed by recent legislation, which abolished most of the consumer protections of the New Deal’s Public Utilities Holding Company Act. To protect ratepayers and stockholders, PG&E Corp. should be abolished and its corporate charter revoked.

All of PG&E Corp.’s income comes, in effect, from tax minimization strategies, which allow PG&E Corp. to keep revenue that would otherwise be paid as income taxes. What are the consequences?

• The creation of the holding company constitutes a legal money-laundering strategy that has greatly benefited the holding company. A 2002 brief by California’s attorney general says that PG&E Corp. collected $663 million in net revenues from 1997 to 1999 by avoiding payment of income taxes.

• From 2000 to 2004, Mark Bumgardner of the CPUC’s Division of Ratepayer Advocates (DRA) wrote in a 2006 report, "PG&E Corporation has been able to save $683 million in Utility taxes…. Since the benefits of being able to write off unprofitable affiliates for tax purposes is [sic] solely for the Holding Company’s benefit, DRA allocated 100% of the tax department’s costs to PG&E Corporation."

• Top officers at PG&E Corp. made out like bandits: President Robert D. Glynn’s total pay skyrocketed from $2 million in 1998 to $34 million in 2003, despite the fact that he led the company into bankruptcy.

• Almost all of PG&E Corp.’s revenues from 2001 to 2004 came from its regulated utility. PG&E Corp. got to keep an extra $1.346 billion from 1997 through 2004 by taking advantage of the tax benefits available to utility holding companies, if the attorney general and the DRA’s Bumgardner are correct.

The CPUC and the legislature created the holding company in a series of decisions and laws in the mid-1990s. However, the idea that deregulation California-style would bring competition and lower electric rates has proved to be false. Abolish the holding company, and this lucrative PG&E Corp. tax dodge ceases to exist.

To deal with PG&E’s high rates and unresponsive electric service, San Francisco public power activists and public officials tried to take over PG&E’s San Francisco grid in 2001 and 2002. In Yolo County, just west of Sacramento, activists and elected officials worked for years to drive out PG&E and replace it with electrical service from the Sacramento Municipal Utility District. The SMUD charges 30 percent less than PG&E and far exceeds PG&E in the use of solar and wind power per customer. PG&E spent a record $50 per customer — at least $15 million, on 300,000 voters in Sacramento and Yolo counties — in November 2006 to turn back the public power challenge.

For others in Northern California, a return to traditional regulation as it functioned before the deregulation disaster may be the best that can be expected. Abolishing the holding company — a step the CPUC has the power to take — would be a good place to start.

Dan Berman

Dan Berman is the author of Who Owns the Sun? and is a longtime public power activist in Northern California. He lives in Davis and can be reached at danmberman@gmail.com.

Bush’s big favor to PG&E

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EDITORIAL If there were ever any doubt about the political forces arrayed behind the move to demolish San Francisco’s Hetch Hetchy dam, this should put it to rest: President George W. Bush, who has done nothing but attack, undermine, and cut funding for public parks and environmental initiatives since the day he took office, suddenly wants to spend $7 million to study restoring the valley behind the dam.

That’s right. Tucked into the Bush administration’s Department of the Interior budget is a special allocation that just happens to match exactly what the state of California said it would cost for the next step in pursing dam removal in Yosemite National Park.

Initial signs are that the plan isn’t going anywhere: Sen. Dianne Feinstein, who chairs the Senate subcommittee that funds Interior, says she’ll never let the money go through. Even Republican Rep. George Radanovich, who represents the Yosemite area in Congress, says he opposes the idea and has no idea why the administration is pushing it.

Well, we have a clue.

Bush isn’t much of an environmentalist, and it’s hard to believe he really cares about creating a new wilderness area in California. But he’s a hell of a privatizer and supports almost anything that shifts public resources into the hands of profit-making companies. And blasting the city’s water and hydropower dam to dust would be a huge favor to one of the nation’s largest private electric companies — and a huge blow to public power efforts in San Francisco.

Feinstein points out — correctly — that the dam provides fresh water to almost three million people in the Bay Area. But it also provides electric power — not enough to light all of San Francisco, but enough to provide a nice solid base for a municipally owned electricity system. In fact, the dam itself is the biggest argument for kicking Pacific Gas and Electric Co. out of town: the act of Congress that allowed San Francisco to dam Hetch Hetchy Valley for water also mandated that the dam generate electricity and that this cheap power be sold to the residents and businesses of the city as a public alternative to the PG&E monopoly.

PG&E is terrified by the prospect of losing a single customer to public power and for good reason: electricity controlled by public agencies is consistently cheaper and, these days, more environmentally sound than the stuff you buy from PG&E. Up in Yolo County, businesses recently realized they were paying more money for power than their colleagues (and competitors) a few miles away in Sacramento, so they moved to join the Sacramento Municipal Utility District. PG&E spent more than $10 million on a campaign to defeat the proposal — and that area involved only 77,000 customers. Imagine what the company would be willing to do to halt the growing calls for public power in San Francisco, a market roughly five times that size.

It’s no coincidence the company is pouring cash into a public-relations campaign aimed at burnishing its environmental image. And as we report in "PG&E’s Poll" on page 10, pollsters apparently working for PG&E have been market-testing several ballot initiatives that would directly attack the city’s ability to go into the power business.

But tearing down the dam would be a far more effective assault. Without the dam the federal mandate for public power would vanish, as would a free (we paid for it long ago), reliable, copious source of renewable electricity that uses no fossil fuels.

Sure, there’s an environmental argument for tearing down the dam — as soon as those 400 megawatts of electricity can be replaced by city-owned solar, wind, or tidal power. But that’s years off. For now the alternative to hydro is largely fossil fuels, which makes the green case for removing the dam shaky at best.

So let’s be serious here: This is not about environmental restoration. It’s about keeping San Francisco out of the power business and preserving PG&E’s private monopoly. That’s so perfectly in line with the Bush administration’s political philosophy that we’d be stunned if PG&E and its allies weren’t the ones who got that $7 million allocation snuck into the Bush budget.

All of which is, of course, an excellent reason for Congress to scrap this budget item, and it appears that will happen. But it’s also reason for public power advocates to go on full alert: PG&E isn’t sitting back and waiting for the next municipalization campaign. The company is making its own plans to cut public power off at the knees — and that means the progressives need to be mobilizing for a full-court press on the issue. Now. *

Bush and the Hetch Hetchy mystery: Who do you suppose put that mysterious pro-PG&E line in Bush’s $2.9 trillion budget?

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By Bruce B. Brugmann

Well, there it was in the Chuck Squatriglia story in the Feb. 7 Chronicle: the mystery story with the mystery headline: “Hetch Hetchy line in Bush’s budget blasted.”

The lead continued the mystery story with a mystery lead: “A single line deep within President Bush’s $2.9 trillion federal budget has renewed the debate over draining the Hetch Hetchy Valley and returning it to its natural state.”

The second paragraph added some mysterious detail to the mystery: “The president set aside $7 million within the National Park Service budget to ‘support Hetch Hetchy restoration studies’ that would explore the environmental and recreational benefits of draining a reservoir that provides water for 2.4 million Bay Area residents.”

In the second to last paragraph in the story was yet another mysterious paragraph that added to the mystery: “No one at the Department of Interior or within the Park Service or the Office of Management and Budget, which compiles the president’s budget proposal, could say who included the Hetch Hetchy item in the spending plan or why.”

Gosh, golly, gee: How in the world did a line asking for funds to restore Hetch Hetchy Valley get into the federal budget of one of the most anti-environment presidents of all time? The Chronicle and everyone else who covered the story without gulping, including the Sacramento Bee/McClatchy papers and their self-immolating tear-it-down-and-damn-the-consequences position. could not come up with the answer. Nobody even seemed to try or disclosed who they called or what anybody told them or indicated how hard the papers tried to tackle this tough Washington story with a big local angle. Nor did the papers call anybody from the public power forces to see if they had a clue or a comment.

Well, we have a clue. Bush is no sudden born again environmentalist and he doesn’t really give a damn about opening up a dammed up valley in a national park. “But,” as our Wednesday editorial states, “he’s a hell of a privatizer, and supports almost anything that shifts public resources into the hands of profit-making companies. And blasting the city’s water and hydropower dam into dust would be a huge favor to one of the nation’s largest private power companies–and a huge blow to public-power efforts in San Francisco.”

The federal Raker Act that allowed San Francisco to dam Hetch Hetchy Valley for water also mandated that the dam generate electricity, and that the cheap power be sold to the residents and businesses of the city as a public alternative to PG&E’s private monopoly. Thus, PG&E would be the biggest beneficiary of any restoration project.

Once again, I am curious why the restore Hetch Hetchy forces are so adamant on restoring Hetch Hetchy, but seemingly not as interested in other major environmental issues. Why do they not put at least comparable energy into saving and taking back the Presidio? Or properly funding the other major longtime maintenance problems at Yosemite? Or helping stop the moves to privatize the national park system and other public assets? Or moving to stop and/or criticize and confront the many moves of the Bush administration to turn back the clock on the environment and environmental protections?

All of these issues, let me emphasize, are not important to PG&E and its allies except to help PG&E’s astroturf green campaign to stop the inroads of public power and enforcement of the Raker Act to bring our own Hetch Hetchy public power to our own people in San Francisco. Repeating for emphasis: PG&E would be the major beneficiary of any restoration project. Anybody have any other suggestions or ideas? B3

Professional note to Hearst corporate in New York via Chronicle/Hearst publisher Frank Vega and Editor Phil Bronstein: Isn’t it about time, after all these decades of abject Hearst obeisance to PG&E, to allow your reporters and editors in San Francisco to tell the truth and do the real story about the PG&E/Raker Act scandal. (See Guardian stories and editorials going back to the pioneering story of Professor Joe Neilands in the l969 Guardian). B3, who is for restoring Hetch Hetchy Valley only after public power and real environmental reform come to San Francisco under the public power mandates of the Raker Act and a U.S.Supreme Court decision, much more to come, stay alert

P.S. Ever wonder why the Washington press corp and the mainstream media couldn’t figure out what Bush was up to with his propaganda march into Iraq? And why they now are having so much trouble with those anonymous military sources who are now beating the tom toms about Iran influence in Iraq? Go back and read this story again and follow our coverage on what we consider to be the biggest scandal in U.S. history involving a city. The PG@E/Raker Act scandal is also, let me emphasize, one of the most censored stories in U.S. history. Details to come.

Idle question: do you suppose those “competitive” Dean Singleton papers down the Peninsula, in the East Bay, in Marin, all over the place, will pick up on the mystery and figure it out?

SFBG ONLINE: Bush’s big favor to PG&E

Modesto Bee-Hetch Hetchy Editorials

Newsom’s dodge

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By Chris Albon
Mayor Gavin Newsom is still dodging questions about his affair with his campaign manager’s wife and his alcohol problem, even as masses of reporters show up at his public appearances, such as today’s event touting a PG&E program.
The small press conference at the Academy of Art University on San Francisco’s new $11.5 million Energy Watch program, sponsored primarily by PG&E, was Newsom’s first event since he announced yesterday that he was seeking treatment for alcohol abuse at Delancey Street Foundation.
Newsom was 15 minutes late and a small crowd of reporters were anxiously loitering and watcing every Lincoln Town car that crept through lunchtime traffic. When the limo finally arrived, Newsom locked in a smile, looked forward, and walked in the building to PG&E’s display table of high-tech light bulbs.
The mood was tense and the event’s organizers and the mayor’s staff seemed skeptical that the media was there to get information on the plan to distribute more energy efficient light bulbs to small businesses.
“I know many of you are here because you care so deeply about climate change,” was how Jared Blumenfeld, director of the San Francisco department of the environment, expressed his cynicism.
When Blumenfeld introduced Newsom to speak, the room was awkwardly quiet. No one applauded.
“Thank you everyone, for the applause,” Newsom said. Only then did the small crowd applaud.
After his speech on the new plan, the mayor did take questions, but he was not going to dive into the affair or his alcohol problem.
“Any more questions,” Newsom asked adding, “on this issue?” before it was too late.
As the mayor walked out, I thought it a perfectly appropriate and respectful question to ask the mayor “if there was going to be a time when he would take questions on his alcoholism or his affair,” but apparently he didn’t agree.
“You’ve taken liberty with the question,” he said.
I took that as a “no.” Maybe I should have asked why a mayor who purports to support public power was helping to prop up PG&E’s aggressive greenwashing efforts. Next time.

Advancing public power

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EDITORIAL A few months ago Pacific Gas and Electric Co. spent more than $10 million trying to keep the public Sacramento Municipal Utility District from annexing a part of Yolo County, which would have cost PG&E 77,000 customers. It was a stunning amount of campaign cash — and as is often the case, it worked: PG&E narrowly won the day, public power suffered a setback, and the people who wanted to get out from the private utility’s high rates and save big money by buying electricity from a public power agency had their hope shot down.

We’re used to this in San Francisco, where PG&E money and power have carried the day for more than 80 years and prevented the city from complying with the Raker Act, the federal law that requires public power. But the outcome of the Yolo County battle is a reminder of how high the stakes are for the beleaguered private utility — and how creative public power advocates are going to have to be in PG&E’s hometown.

It’s likely that there will be another ballot measure in the next year or two to authorize the city to sell bonds and take over PG&E’s local distribution system. The evidence is clear: public power is cheaper, public power is more environmentally sound (remember — for all its green hype, PG&E still runs a nuclear power plant), and public power is San Francisco’s legal mandate. Just about everyone in City Hall claims to be a public power supporter these days.

But in the meantime, the supervisors need to start looking at immediate alternatives that don’t involve an expensive ballot battle. There may well be ways to bring public power to San Francisco without having to confront a $10 million (or $20 million or $30 million) PG&E political blitzkrieg.

The most obvious approach is to continue the small steps the city is currently taking and leverage them into a much bigger program. There is, of course, community choice aggregation, which should continue to move forward. Beyond that, San Francisco just won the right to provide electricity at the Hunters Point Shipyard Redevelopment Project; the city is trying to do the same for Treasure Island. Why not start with the shipyard and build a public power system outward, block by block, neighborhood by neighborhood?

PG&E has no legal right to be the exclusive provider of retail power in the city. There’s no legal reason why San Francisco can’t start running wires out of the shipyard — underground, safely, with modern equipment — buy up a bunch of meters, and start offering the residents of Bayview–Hunters Point cheap electricity. The revenue from the first, say, 50-square-block project could fund the next one. The seed money could come as a loan from the General Fund.

The first thing the city’s Public Utilities Commission needs to do is conduct a study of the cost of implementing public power on a small scale in one part of town — and the likely revenue it would bring in. A larger study should look at how the city could build its own distribution system (with state-of-the-art equipment) one step at a time over, say, five or 10 years.

At the same time, of course, while the city is running electric wires, it can run fiber-optic and (if necessary) coaxial lines, with the goal of creating a city-run broadband and cable TV service.

The ideal place to start discussing this is the Local Agency Formation Commission, which should hold hearings as soon as possible, prod the SFPUC to move — and fund the study if nobody else will.

In the meantime, the City Attorney’s Office should look into another (admittedly slightly unconventional) idea: could the Redevelopment Agency, which already has the authority to issue bonds, simply seize all of PG&E’s wires, poles, and meters for a public power system?

We don’t trust the Redevelopment Agency, and it’s risky to even raise this idea. But there’s a larger issue here: in many cities and counties the council or board of supervisors runs the Redevelopment Agency. We’ve long thought that the district-elected board would be more accountable and better suited to handle the immense (and dangerous) power of this agency than a commission appointed by the mayor.

Think about it: The supervisors take over redevelopment. Redevelopment buys out PG&E’s system. A new city agency, under the supervisors, starts selling retail power at cheap rates citywide and builds new solar, wind, and tidal facilities to make San Francisco a true national model of environmentally sound energy policy.

If it’s legal — and the city attorney needs to issue an opinion on that — all it would take is political will. *

Editor’s Notes

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› tredmond@sfbg.com

It’s getting a bit creepy how easily and casually we are all starting to joke about global climate change.

It’s not coming, it’s here. My brother is framing houses in a T-shirt in upstate New York. And it’s so cold in California that the citrus crop is ruined. The other day one of my colleagues mentioned that global warming might not make every place warmer; "it’s just going to kill us all."

Maybe it will.

One of the most chilling (sorry) depictions of what’s about to happen comes not from Al Gore’s movie (which was powerful) but from a book called A Friend of the Earth, which is a pretty bad novel by a very good writer, T.C. Boyle. The story line is weak, but the scene — Santa Inez in 2025 — has a strange air of realism. It’s almost impossible to live there in Boyle’s future; the storms are so regular and fierce that only specially constructed homes can survive them, and almost nobody spends much time outdoors.

I have a friend who’s a very, very successful investment adviser, a self-made millionaire several times over, who has been living a dream of a life in Boca Raton, Fla., diving and spearfishing and cruising around on his yacht … and he just sold his place and bought a dirt farm in Kentucky. Florida is going to be wiped out by the hurricanes, he says. He’s also shut down a lot of his business, since he thinks the US economy is going to completely tank soon. He wants to be someplace where he can grow his own food.

I think this is crazy. I’ve never been into doomsday. I have two kids, which by itself is an act of optimism and hope. As we say in my family (which has elevated the art of denial to world-class levels), everything is going to be just fine.

So I laugh about the weather like everyone else. I live way up on a hill; if the ice melts and the sea rises all the way to my doorstep, it will be time to buy an ark. I’ve always been into boats anyway.

But right now it really feels like this is coming at us a lot faster than anyone expected. And the much-heralded moves by the governor of California to reduce greenhouse gases a little bit by a few years from now seem so incredibly puny.

In politics I’ve always felt that intent matters. There are some wonderful programs that don’t work as well as they should, not because of corruption but because the money is inadequate or the staff isn’t properly trained or somebody made some mistakes. That’s different from somebody deliberately lying, cheating, and stealing to game the system.

Pacific Gas and Electric Corp. is a corrupt institution with sleazy lawyers and consultants who abuse the local political system. Carolyn Knee, who was the treasurer for a group fighting on behalf of a ballot campaign for public power in 2002, is a good person who apparently made some mistakes in the complex process of filing all the campaign finance documents on a volunteer basis for a grassroots initiative. And she just told me the SF Ethics Commission wants to fine her $26,700.

There’s something very wrong here. *

Some questions for the mayor

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EDITORIAL Gavin Newsom doesn’t want to take direct questions from the supervisors. He rarely gets asked tough questions from the press and almost never from the public. Instead, as Steven T. Jones and Sarah Phelan report ("Mayor Chicken," page 13), all of his appearances are scripted, and he does a mighty job of ducking the hard questions.

But if he is indeed going to be holding a series of town hall meetings over the next few months, there’s a chance for the voters to pin him down. Here are a few things you might want to ask the mayor:

• Your own staff admits that the universal health care plan works only if employers are required to provide health benefits. Yet the Golden Gate Restaurant Association — your political ally — has sued to block this. Do you support the employer mandate? Will you call on the GGRA to drop the suit? Will you decline political contributions from the members of a group that is suing the city with the aim of destroying one of your key initiatives? Where will money come from if the suit succeeds?

• When you ignored the will of the voters and decided to hold these town hall meetings instead of appearing before the supervisors, you said the supes were invited to attend. But you knew it would be illegal for them to participate under the Brown Act without some expensive preparations. Why did you do that?

• Why isn’t your full appointments calendar posted on the Web? The only information the public gets is a listing of your public events. Where is the rest of the calendar?

• You say you support public power, but the city’s efforts are so far limited to Treasure Island and Hunters Point. If there were a ballot measure this fall calling for the city to buy out Pacific Gas and Electric Co.’s system and set up a full-scale public power effort — similar to Sup. Tom Ammiano’s measure in 2000 — would you pledge to endorse it?

• The city’s general plan states that 64 percent of all new housing should be available for below-market rates. Sup. Sophie Maxwell has a proposal to make that city law. Do you support her legislation? If not, how will the city meet its affordable housing needs?

• The Planning Department acknowledges that the level of new market-rate housing being discussed for the eastern neighborhoods would inevitably destroy thousands of blue-collar jobs. Is that an acceptable trade-off?

• Broadband Internet service is arguably the most important public infrastructure American cities will build in the next 50 years. Why are you prepared to turn ours over to private industry? Would it not be worth $10 million — the estimated cost put out by Google and EarthLink — to build our own system?

• You asked for the City Attorney’s Office opinion that invalidated the successful referendum drive on the Bayview–Hunters Point Redevelopment Plan. Why aren’t you willing to submit this far-reaching plan to a vote? And if you believe in the plan’s community oversight provisions and deference to the Redevelopment Agency, why did you unilaterally offer the 49ers a new stadium at the old shipyard, which is within the plan’s area?

• Why haven’t you followed up on the promise you made a year ago, after expressing outrage over the racist and homophobic videos made by police officers, to form a commission charged with "changing the culture" of the Police Department? And after your office blocked a citizen-based community policing plan, why didn’t you offer some alternative? Are you content with the way the department is being run?

• Eight months ago, after vetoing a six-month trial period for closing JFK Drive to cars on Saturdays, you promised to study Sunday closures for six months and offer a compromise plan for Saturday closures. When can we expect that proposal, and will you now support Saturday closures?

Honestly: what’s so scary about answering questions from the supervisors?

We await his honor’s response. *

Free wi-fi for everyone

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EDITORIAL Basic municipal infrastructure — roads, water and sewer pipes, train tracks, airports, that sort of thing — has traditionally been owned and operated by the public sector, and for good reason: private experiments with toll roads, profit-motivated water companies, and even city rail companies have typically been disasters. The fundamental building blocks that hold a city together are public goods, paid for by tax dollars, for use by all, either free or at the lowest possible cost.

We’ve argued for years that electricity ought to be in that category, and San Francisco is finally taking some cautious baby steps toward public power. But city officials are about to turn what could be the single most significant new piece of infrastructure in our lifetime — broadband Internet service — over to a private consortium. It’s a mistake, and the supervisors shouldn’t go along with the deal.

Mayor Gavin Newsom has made free universal wi-fi a key part of his political agenda, but through a process that’s been secretive and flawed from the start, he has chosen Google and EarthLink to put forward a proposal. As Sarah Phelan reported last week ("Selling Wi-Fi," 12/27/06), the two big tech companies are taking their road show around the city, trying to convince residents and businesses that their plan — which calls for limited free access combined with a fee-based system — will envelop the city in a wi-fi cloud, allowing anyone with a laptop to get instant Internet access anywhere in town, at no cost to taxpayers.

That may be true — but in the process, the city will be giving up a huge part of its future.

Ten years from now, maybe sooner, universal broadband will be as much a part of civic infrastructure as roads are today. Consumers will demand it. Businesses will insist on it. Public education will require it. Providing quality service to everyone — everywhere in town — will be an essential service. Why would we want to leave it to the private sector?

There are all sorts of problems with the Google-EarthLink proposal, starting with its lack of real universal access. Sure, everyone gets a connection — but at 300 kilobytes, it won’t be terribly fast. If you want to be able to quickly download music, videos, or large business files, you’ll need to pay by the month for an upgrade. Low-income folks, in other words, will be stuck in the slow lane. That’s not terribly fair.

It’s also not terribly surprising: these companies are out to make money. And over the years, their bottom line will drive the entire program.

There’s absolutely no need for that to happen. The city’s hired a consultant to look at creating a citywide network of fiber-optic lines under the streets, which is a fine idea, although it would take a few years to build. But even according to the Google-EarthLink consortium’s own estimates, the universal wi-fi network will cost only about $10 million. For a big-city public works project, that’s nothing. Almost every election, we approve another $100 million or so in bonds — for schools, community college buildings, libraries, parks, and police stations, all worthwhile projects. The city’s annual budget is more than $5 billion, and the cost of maintaining the network would run at about $2 million a year. This could turn out to be as important as anything the city ever builds — and it’s chump change.

The supervisors need to put the private wi-fi proposal on the shelf and immediately start plans to place a bond act on the next ballot to build a city-owned wi-fi and fiber-optic system that will offer true universal, free, high-speed broadband access for all. *

Editor’s Notes

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› tredmond@sfbg.com


It’s been quite a political year in San Francisco. And 2007 is going to be better.


I was talking to my friend and colleague Steve Jones just before Christmas about the folks in the Mayor’s Office (and elsewhere) who still think a progressive vision for San Francisco — a city where the rich pay their fair share, where the public sector provides a wealth of services to the public, where money doesn’t rule politics and elected officials are accountable, a place where tenants are protected and land use is determined by community needs and not developer demands, a city that serves as a model for the rest of the country — is just some sort of wild and pointless fantasy. And Steve and I agreed: in 2006 the progressives won a lot of the key battles, and the so-called moderates who have no vision at all were on the defensive most of the time.


We’ve had setbacks. Things aren’t perfect. But I’ve been living in this city and watching politics for a long time now, and I can honestly say that we’re making progress.


San Francisco has a program that’s aimed at providing health insurance to everyone. San Francisco has a living-wage law. San Francisco has laws that require sizable payments to tenants who are being evicted and that require employers to offer sick days. San Francisco is going to elect its next mayor under a public-financing system that might actually allow genuine candidates who lack downtown money to compete.


San Francisco is demanding that cops actually walk beats in high-crime areas and seriously talking about demanding that almost two-thirds of all new housing be available at below-market rates. San Francisco is moving to provide public power in Hunters Point and at Treasure Island.


And none of that came out of the Mayor’s Office.


The policy debates in this city are happening at the Board of Supervisors, where district-elected representatives are pushing progressive ideas that would never have gone beyond the wild-dream stage 10 years ago.


We’re not all the way there. We still fight with each other and let our egos get in the way. We’re still trying to figure out how to deal with the fact that state and federal laws limit how far we can go to raise money and protect the vulnerable. We still aren’t quite willing as a city or a progressive movement to commit to income and wealth redistribution (at home here, not in Washington or Sacramento), a cause that defines all that we think about and do — and we need to, or in the end nothing else matters.


We haven’t kicked out Pacific Gas and Electric Co. and created a full-on public power system yet. Black kids are still dying from gunfire in record numbers. We don’t have a candidate for mayor.


And all of the people who read this will think of other things we haven’t done, because we in the progressive movement love to complain and argue and we’re never satisfied — which is, in the end, a good thing.

And the big-money greedheads who have had their greasy paws on the levers of power in this town since the Gold Rush aren’t about to surrender. Every step forward is still a struggle.


But we kicked their asses in District Six — and that was one where both sides were in full-court press and everyone knew it mattered. They have come to realize we are not just crazy dreamers.


I love this town. Happy new year. *

Public Power in Jeopardy?

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By Sarah Phelan

In the mood for some political fireworks? Head to Dec. 12 meeting of the San Francisco Public Utilities Commission. A renewable public power project at Hunters Point that has the blessing of the Mayor, the Board of Supervisors, SFPUC General Manager Susan Leal and District 10 Sup. Sophie Maxwell is said to be experiencing opposition from none other than PUC Board President Richard Sklar.
You’d have to be brave to risk being the Man who would stand between Public Power and the Bayview, but Sklar who came to the city from Cleveland in the 1970s, has a history of clashing with the mayors who appoint him, starting with then Mayor Dianne Feinstein when she made him SFPUC General Manager.
According to an article in the San Francisco Chronicle, by the end of that tenure, Feinstein and Sklar were feuding over everything from the Muni to high-rise development, with Feinstein calling Sklar “arrogant,’ and Sklar calling her a “lightweight”.

Public Power in Jeopardy?

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By Sarah Phelan

In the mood for some political fireworks? Head to Dec. 12 meeting of the San Francisco Public Utilities Commission. A renewable public power project at Hunters Point that has the blessing of the Mayor, the Board of Supervisors, SFPUC General Manager Susan Leal and District 10 Sup. Sophie Maxwell is said to be experiencing opposition from none other than PUC Board President Richard Sklar.
You’d have to be brave to risk being the Man who would stand between Public Power and the Bayview, but Sklar who came to the city from Cleveland in the 1970s, has a history of clashing with the mayors who appoint him, starting with then Mayor Dianne Feinstein when she made him SFPUC General Manager.
According to an article in the San Francisco Chronicle, by the end of that tenure, Feinstein and Sklar were feuding over everything from the Muni to high-rise development, with Feinstein calling Sklar “arrogant,’ and Sklar calling her a “lightweight”.

Tax money for PG&E? Why?

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San Franciscans at every level — from individual homeowners to neighborhood groups to public safety advocates and city officials — have been complaining for years about how slowly Pacific Gas and Electric Co. has been moving its overhead power lines underground. The case for undergrounding is clear and indisputable: buried wires are not only far more aesthetically pleasing, they’re far safer, particularly during earthquakes, when wires hanging over streets can snap, start fires, cause electrocutions, and generally be a real menace.
But PG&E won’t pay for the full cost of undergrounding. So wealthy neighborhoods where property owners have agreed to cough up a few thousand dollars each get their wires buried, and the rest of the city waits. There’s a city fund to help underwrite the cost in other parts of town, but it’s never been a big fund, and now it’s out of money. The Utility Undergrounding Task Force is preparing to ask the supervisors to add a modest 5 percent tax on every electric bill in the city to pay for moving 490 miles of wires under the streets.
The tax isn’t going to bankrupt anyone — for most residential users, we’re talking about a couple of dollars a month. But the whole idea strikes us as backward thinking: Why should city residents and businesses pay a private utility to do something that it ought to be required to do on its own? Why is the city even talking about taxing residents to subsidize PG&E when the company is already operating an illegal monopoly in town — and when the very mention of the Raker Act, the federal law that requires the city to run a public power system, ought to be enough to get the utility to fall into line and pay its own undergrounding bills?
And why are we talking about putting a bandage on a system that doesn’t work when a concerted effort at bringing public power to San Francisco — now, not later — would make the entire discussion unnecessary? After all, any credible economic analysis will show that public power would bring so many hundreds of millions of dollars into the city that minor irritants like burying power lines wouldn’t cost the taxpayers an additional penny.
We fully recognize that the battle for public power has never been and never will be easy. PG&E just spent upward of $10 million to defeat a public power plan in Davis, and that service area is far smaller than San Francisco. The company informed Mayor Gavin Newsom this fall that it will fight bitterly any municipalization effort. And there’s no giant pot of pro–public power money out there to finance a campaign.
But with the mayor, the head of the Public Utilities Commission, the city attorney, and two-thirds of the supervisors saying they support public power, it seems crazy to simply accept that the city is stuck under PG&E’s thumb for the foreseeable future (and that basic public safety amenities like buried power lines have to be paid for out of tax dollars). If Newsom is serious about this, he needs to step up and offer a public power plan — and if he doesn’t, the supervisors need to. And let’s not talk about higher utility taxes until they do. SFBG

Turning point

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› news@sfbg.com
It’s amazing what the New York Times can find newsworthy. On a night when progressives in San Francisco racked up an impressive list of victories — and the popular mayor, often described as a rising star in state and national politics, got absolutely walloped — the nation’s newspaper of record led an online report on city politics with this gem: “A bike-riding member of the Board of Supervisors apparently won re-election while his wife was reported to have screamed an epithet at opponents.”
The Times story, by Jesse McKinley, called it “just another night in San Francisco’s iconoclastic politics,” meaning, apparently, that only in this city would a politician ride a bicycle and only here would a politician’s wife use foul language in public.
Please.
For the record: Sarah Low Daly — who watched her husband, Chris, get pummeled mercilessly for weeks by brutal attack ads paid for by, among others, the Golden Gate Restaurant Association — did dismiss “those motherfuckers” with a colorful epithet that no less than the vice president has used on the floor of Congress but that can’t ever appear in the New York Times.
But allow us a little context here.
Daly’s wife had every right to celebrate on election night — and every right to slam the forces that were so unwilling to accept a living wage for local workers, sick pay for employees, requirements that developers pay for affordable housing, and the rest of Supervisor Daly’s progressive agenda, which had made him the subject of a Karl Rove–style smear campaign.
And the Times (as well as the embittered blogger at the San Francisco Sentinel who leveled personal insults at the supervisor’s wife) utterly missed the point of what went on in San Francisco last week.
This was a watershed in city politics, an election that may turn out to have been every bit as important as the 2000 ballot that broke the back of the Brown-Burton machine. It was evidence that district elections work, that downtown money doesn’t always hold the day — and that Mayor Gavin Newsom made a very bad political mistake by aligning himself with some of the most intolerant, unpleasant, and ineffective forces in local politics.
NEWSOM THE LOSER
We ran into Newsom’s press secretary, Peter Ragone, the day after the election and asked him the obvious question: “Not a very good night for the mayor, huh?”
It was a hard point to argue: Newsom put immense political capital into two key races and was embarrassed in both of them. He worked hard for Rob Black, the downtown candidate trying to oust Daly in District 6, showing up at Black’s rallies, walking the streets with him, talking about the importance of the race, and helping him raise funds. His handpicked contender in District 4 was Doug Chan, a former police commissioner. Black lost by 10 percentage points; Chan finished fourth.
And a long string of progressive ballot measures that the mayor had opposed was approved by sizable margins.
Ragone began to spin and dissemble like crazy. “We endorsed [Black and Chan] but didn’t put a lot into it,” he said despite the fact that Newsom spent the last two weekends campaigning for his two favorites.
“The real key for us was Hydra Mendoza, who won [a seat on the school board],” Ragone said.
Yes, Mendoza, who works as the mayor’s education adviser, was elected — but she already had a strong base of support as a former leader of Parents for Public Schools and might very well have won without the mayor’s help.
Besides, if Newsom saw her as a top priority, why did she finish second in a race for three positions, behind Green Party candidate Jane Kim? And how significant will it be to have Mendoza on a school board that now has a solid progressive majority, one she’s not a part of?
Ragone shrugged again, sticking to his line.
But the Mayor’s Office can’t spin away the fact that, as pollster David Binder put it at a postelection event, “I don’t think Newsom had a very good night.”
“It showed that we had a progressive turnout and this is a progressive town,” Binder said.
Boris Delepine, a campaign veteran and Sup. Ross Mirkarimi’s board aide, went even further: “This election ranks up there with the 2000 supervisorial races as far as I’m concerned.”
In other words, progressives battled the downtown interests and won.
The most exciting race was in District 6, where Daly’s expected reelection was thrown into doubt a few weeks ago by some polls and the onslaught of downtown attacks on Daly (which Binder jokingly referred to as “a deforestation project” for all of the negative mailers).
The problem was that most of the material just attempted to savage Daly without really making the case for why Black would be better. That appears to have backfired.
In fact, the assault served to galvanize Daly supporters, who stepped up a vigorous campaign in the final push. “It was very efficient and very effective,” Binder said.
Or as Daly put it to his supporters on election night, “We were under attack…. San Francisco values were under attack, and you responded like nothing before. Five hundred volunteers were in the streets today to say this district is not for sale.”
The message from the Tenderloin, inner Mission, and South of Market was resoundingly clear: with district elections downtown can’t simply buy a seat on the board anymore. Money is powerful — but an organized grassroots campaign can still prevail.
The impact for the mayor is more than just the loss of a potential board ally. Newsom found himself in District 6 working closely with SFSOS — a group that has become so nasty and is so reviled, even two of its key founders, Senator Dianne Feinstein and financier Warren Hellman, have walked away in disgust.
“If all things were equal, I’d just as soon that SFSOS went away,” Hellman told us.
It’s not going to help the mayor’s reputation to be seen in that sort of company.
A HIPPER DUFTY
The District 8 race showed the power of district elections in a different way.
From the start it was going to be tough for Alix Rosenthal, a straight woman, to defeat incumbent supervisor Bevan Dufty, a gay man in what has always been a gay district. But Rosenthal says her candidacy had a clear impact on Dufty — during the late summer and fall, the onetime solid mayoral ally moved a few noticeable steps to the left, supporting Sup. Tom Ammiano’s universal health care bill and voting with the progressives (and against the mayor) for police foot patrols.
“Dufty became a much hipper person after I challenged him,” Rosenthal said.
Dufty told us the challenge made him work harder but had no impact on his votes. “What you saw on foot patrols was an immense amount of frustration with the police chief’s failures to lead the department,” he said. “That had nothing to do with this race.”
Binder pointed out that District 8 has a higher percentage of registered Democrats than any district in the city, and Dufty locked down party support early on. And even though Dufty’s voting record was less progressive than his district, he remains popular. “There are people who think he doesn’t vote the right way on the issues, but nobody thinks he doesn’t try hard,” Binder said.
The District 4 race was not only a test of the power of the mayor’s coattails in a district where Newsom has always been popular. It was also a test of how ranked-choice voting works in complex election demographics.
From early this year, when it became clear that incumbent Fiona Ma was going to the state assembly, Newsom and his allies tapped Chan as the candidate they would promote. That was an odd choice for Newsom, who claims to be a public power supporter: Chan’s law firm has received more than $200,000 in legal fees from Pacific Gas and Electric Co. in just the past two years, and like his alliance with Black in District 6, the Chan endorsement put him on the side of one of the least popular actors on the local political stage.
And in the end, the mayoral support meant little: Chan finished fourth, after Ron Dudum, Ed Jew, and Jaynry Mak.
There was a certain amount of nervousness on election night when Dudum emerged atop the candidate list at the prospect that for the first time in a generation, the board would be without Asian representation. Four Asian candidates appeared to have split the vote, allowing Dudum to win.
But when the ranked-choice voting program was run Nov. 10, that concern evaporated: the new system allowed Asian voters to divide their preferences without risking that sort of vote-split result. When it was all over, Ed Jew emerged the winner.
As Jew told us, “I think it showed that having so many Asians benefited the top Asian vote-getter.”
GREEN DAYS
The school board and community college board races get less press than the top of the ticket, but as citywide contests, they can be even tougher for progressives. And this year the Green Party had some surprising victories.
Jane Kim, a Green, finished top in the balloting — remarkable considering that she didn’t have the endorsement of the Democratic Party. Mendoza came in second, followed by Kim-Shree Maufas. That puts three new members, all of them women of color, on the board and shows that activists frustrated by the votes of longtime incumbent Dan Kelly could defeat someone who until recently was considered a shoo-in for reelection.
Peter Lauterborn, a Kim supporter, was ecstatic about the win. “This is a massive triumph,” he said. “We beat the money and we beat the establishment.”
The same goes for the community college board, where John Rizzo, a Green, appears to have edged out Johnnie Carter, bringing new reform blood to an ossified and often corrupt agency.
Binder attributed the strong finishes by Kim and Maufas to their endorsements by the Guardian, the Democratic Party, and other lefty supporters. He was surprised by Rizzo’s apparent victory (absentees could still change the outcome) but most on the left weren’t. Rizzo had a lot of grassroots support and ran a strong campaign.
Similarly, Mirkarimi — who attended the postelection briefing along with fellow supervisor Daly — didn’t agree with Binder’s line on the school board, noting that the defeat of Kelly and the election of Kim and Maufas were strong endorsements for the stand that the current board lefties — Mark Sanchez, Sarah Lipson, and Eric Mar — have taken against positions by autocratic former superintendent Arlene Ackerman and her downtown backers.
“We got four votes on the school board,” was how Delepine put it, adding, “President Sanchez, man.” SFBG
Steven T. Jones and Alix Rosenthal are domestic partners. Tim Redmond wrote the analysis of the results in District 8. Amanda Witherell contributed to this story.

And now City Hall claims there’s a new “sunshine” problem. We suggest how to deal with it.

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By Bruce B. Brugmann

The City Attorney and City Hall are lathered and steamed these days because of a barrage of public records requests from Kimo Crossman, a public records activist with few equals.

The principle seems to be: go after Kimo full bore but do not molest PG@E on its low franchise fee in perpetuity, the lowest in the state,or its private power monopoly that is illegal under public power mandates of the federal Raker Act and U.S. Supreme Court. So we offer some suggestions on how to deal with the new “sunshine” crisis.
For starters, Kimo has a good idea: create a publicly accessible database that gets automatic copies of every document created at City Hall (unless there’s a damn good reason to mark it secret). That way the busiest of advocates can spend their time searching the files on their own, and the city’s lawyers can do what they ought to be doing, fighting PG@E. B3

SFBG: The new sunshine “problem”

Prosecute election theft

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EDITORIAL There’s no doubt at all that a group of downtown businesses operating through a series of supposedly independent political committees organized in part by attorney Jim Sutton have used every tool at their disposal to influence the outcome of the District 6 supervisorial election. And there’s no doubt that what these folks have done violates at least the spirit of the city’s election laws, which were designed to offer, as much as legally possible, a level playing field for candidates and full disclosure of campaign expenses.
There’s also no doubt that Sutton has been willing to bend and at times break the rules: in 2002 his law firm was fined $240,000 — the largest penalty of its kind in city history — for failing to disclose late contributions from Pacific Gas and Electric Co. to a campaign to defeat a public power initiative.
At some point this sort of conduct rises to the level of a crime — and at least some respectable, credible activists and observers think the attacks on Sup. Chris Daly have reached that level. In a letter to the Guardian, published on page 8, former ethics commissioner Joe Lynn argues that Sutton and his allies are guilty of attempting to steal an election.
There’s no crime in the books called “Grand Theft, Election,” although there probably should be. But Lynn says that what’s happened here — unregulated committees raising and spending tens of thousands of dollars and not fully disclosing it until late in the cycle — is not merely sleazy and unethical but criminal.
We’re always nervous about bringing the criminal justice system into political disputes (we still remember how then-mayor Art Agnos pushed the district attorney into conducting a witch-hunt investigation into the opponents of a downtown ballpark ballot measure). But we’re also sick of seeing the likes of Sutton, Don Fisher, and SFSOS operate with virtual impunity when what they are doing comes very, very close to a conspiracy to subvert local election laws. The Ethics Commission needs to conduct a full investigation here, but that body can impose only civil penalties, which means cash fines — and for billionaire Fisher, whose money is behind a lot of these shenanigans, a stiff fine is just the cost of doing business.
District Attorney Kamala Harris ought to look into this. The problem is that Sutton was her lawyer in a heated campaign in 2003 during which her opponent, Terence Hallinan, raised similar charges. So Harris is conflicted; the best solution would be to appoint outside counsel — a special prosecutor, to use the Washington terminology — to investigate whether Sutton, Fisher, SFSOS, or anyone else ought to face criminal prosecution. The sooner that process gets started, the better. SFBG

Proposition 90 isn’t about eminent domain

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Here are some of the things that could be impacted if Proposition 90 passes: NEIGHBORHOOD PLANNING Developers could argue against providing additional community benefits, which are often mandated when increased building height or density is allowed. New zoning restrictions would be hit hard. LOCAL LAWS If Prop. 90 passes, it amends the state’s constitution — and virtually nullifies a number of local antisprawl and smart-growth measures also on the November ballot. In San Francisco the formula retail ordinance (Proposition G) and the tenant relocation ordinance (Proposition H) could create costly litigation. ELLIS ACT Prop. 90 does not affect statutes, ordinances, and measures that already exist, but new tenant protection would be rendered moot. “Any amendment to our law that would cost the city money would be affected by Prop. 90,” said Delene Wolf of the Rent Board. PUBLIC POWER Prop. 90 doesn’t lend any help to municipalities looking to control their own utilities. If San Francisco were to kick out Pacific Gas and Electric and take over the utility’s distribution infrastructure, the corporation could tack millions of additional dollars onto the city’s bill by arguing a loss of future revenue from the seizure. MANDATORY HEALTH COVERAGE San Francisco passed its landmark universal health care plan earlier this year. But with the plan set to be introduced in stages, there’s uncertainty as to whether it will leave the city open to claims of “substantial economic loss” from small businesses opposed to its passage. HISTORIC PRESERVATION St. Brigid Catholic Church in San Francisco is owned by the Academy of Art Institute, which recently petitioned the Board of Supervisors to have national landmark status removed from the 100-year-old building — allowing for a drastic altering of its Romanesque facade. The board denied the request this past October. Under Prop. 90 the Academy of Art could sue the city for the cost of adhering to these guidelines or for the profit lost for what it would have used the building for if allowed to change it. (Amanda Witherell and Sarah Phelan)

Let us lift a Potrero Hill martini for Thomas Peele of the Contra Costa Times/Singleton papers. He criticized Singleton by name for sealing court records in the Hearst/Singleton antitrust case.

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I’m drinking a Potrero Hill martini in honor of Thomas Peele, the investigative reporter on the Contra Costa Times/Dean Singleton papers.

He did what few editorial staffers do in these dread days of mega media mergers and resulting layoffs: he sharply criticized his new boss in a “guest commentary” column in his own paper, the CCTimes.

He was commenting on the federal court ruling that sealed the records in the Clint Reilly/Joe Alioto antitrust case aimed at breaking up the Hearst/Singleton deal that would destroy daily competiton and impose regional monopoly on the Bay Area.

His lead: “Many believe newspapers are too much of a public trust to act like any other business. Their corporate owners are not among them.” His conclusion: “With his recent acquisitions, Singleton has moved up another notch in his publishing ascent. His friendship with Bush, his considerable wealth, his abundant Texas charm, combine to allow him lead on free-press and freedom-of-information issues through the principles he avows. His position would be stronger if he begins applying those principles to his own company.”

To his credit, Singleton answered Peele’s tough questions and Peele quoted him in the article. And Singleton and the CCTimes and Singleton managers allowed Peele’s piece to run in Sunday’s paper and posted it on the CCTimes website this morning.

Could this ever happen at the Chronicle/Hearst? Well, it won’t happen until the moment Hearst starts allowing its staff to cover such censored stories as the PG@E/RakerAct scandal (a censored story since the late l920s after Hearst got some timely fresh capital from a PG@E-controlled bank in return for flipping on their support of public power (to be laid out in coming blogs). The latest censored Hearst story: the Chronicle still hasn’t published the big Hearst prescription drug price scandal story, which was run as a lead story in the Wall Street Journal, with versions by the Associated Press, the Guardian, and even the Hearst-owned Houston Chronicle. (see previous blogs).

And nobody from Hearst corporate or Hearst San Francisco will answer my email questions as to why the story wasn’t published in the Chronicle and when it would be or provided an explanation for the embarrassing corporate blackout. B3, who can see the fumes from the Potrero Hill power plant from my desk, courtesy of PG@E and Hearst.

P.S. And the Potrero HIll martini? That is a story for another blog.

Freedom of information must be an unwavering principle by Thomas Peele

So why did the SF Weekly’s Matt Smith endorse a PG@E attorney for supervisor?

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Matt Smith, a columnist for the SF Weekly/Village Voice/New Times, parachuted into the Sunset to check out the field of supervisorial candidates and ended up last week all but endorsing Doug Chan as the PG@E candidate for supervisor.

What Smith’s investigation didn’t turn up was the disturbing fact that Chan is an attorney whose law firm, Chan, Doi, and Leal, has received more than $460,913 in fees from PG@E in the past five years, according to documents on file with the California Public Utilities Commission. (See my earlier blog and our editorial for more details).
Chan is also the beneficiary of a tidal wave of sleazy independent expenditure mailings to Sunset residents, probably from the same PG@E/downtown gang creating the tidal wave of IE sleaze on behalf of Rob Black in the Chris Daly race. (See our stories). The PG@E gang want Chan and Black in City Hall. I asked Smith by email if this were a continuation of the PG@E-smitten campaign that then editor John Mecklin and then reporter Peter Bryne conducted on behalf of PG@E and against the two public power campaigns in 200l and 2002. He parried the question. Chan and the Weekly both ended up in the Guardian’s Hall of Shame after the PG@E victories.

The point: maybe, if this is how the New Times would go about endorsements, it isn’t such a good idea to raise the issue. Their politics appear to be desert libertarianism on the rocks, with stalks of neocon policy. What would the Village Voice/New Times position be on the war and Bush et al? Well, back to Dan Savage, the Voice/New Times sex columnist who has been known to slip an endorsement into his column. (See my previous blog).

P.S. Full disclosure: I live out in the West Portal district a few blocks from the Sunset District. And I am getting tired of supervisors like Sean Elsbernd and Fiona Ma and supervisorial candiates like Doug Chan who come on as “neighborhood” candidates but once in office quickly become anti-neighborhood, pro-PG@E, pro-Downtown supervisors and callup votes for the mayor, PG@E, and downtown. My alternative choices for the Sunset:
Jaynry Mak and David Ferguson, who understand the perils of PG@E and the virtues of public power. B3

The dirt in D6

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› amanda@sfbg.com › sarah@sfbg.com If you live in San Francisco’s District 6, it’s pretty difficult to avoid what some residents are calling a new filth polluting Tenderloin corners and SoMa streets. It’s not overflowing trash bins or urine-stained door frames — it’s the relentless election billeting that uses those images to support Rob Black and oppose Chris Daly for the district’s seat on the Board of Supervisors. “We’re tired of talk. Of loud, whining, condescending, offensive, abusive, lying, showcasing, arrogant talk,” reads a recent poster on a telephone pole. “District 6 is dirty and dangerous. District 6 is still poor. Chris Daly is why. Dump Daly. Back Rob Black.” “I was totally offended by this,” Debra Walker, a progressive activist and resident of the district for 25 years, told the Guardian. “This kind of message intentionally suppresses the vote. People I’ve talked to in the district who aren’t very political are totally turned off by the mailings from Rob Black or made in his benefit.” Some of the mailings, posters, and literature can be directly attributed to independent expenditure (IE) committees recognized by the Ethics Commission and acting legally. Some, however, have more dubious ancestry but apparent links to a campaign attorney with a long history of using millions to control the outcome of elections in San Francisco: Jim Sutton (see “The Political Puppeteer,” 2/4/04). Sutton did not return calls for comment. Most of the anonymous literature directs people to the Web site www.DumpDaly.org. SFSOS’s Wade Randlett told us his group paid for the site and a volunteer set it up. SFSOS and Sutton formed Citizens for Reform Leadership 1–6 — IE committees listed on many of the signs and much of the literature, including the poster quoted above. The committees haven’t filed any IE reports with the Ethics Commission. Walker, along with Maria Guillen, vice president of SEIU Local 790, and another District 6 resident, Jim Meko, submitted a complaint with the Ethics Commission on Sept. 29 with nine pieces of physical evidence supporting their concern that the roof had been blown off the $83,000 spending cap on the campaign, in place because all candidates agreed to public financing. The evidence submitted with the complaint varied and included three different mailers from “Concerned Residents of District 6,” a committee that has yet to exist on paper in the Ethics Commission filing cabinets. The mailers from the “Concerned Residents” are glossy triptychs critical of Daly but not explicitly advocating for another candidate. They do not state the amount the committee paid for them, which is required of any electioneering communication. On Oct. 6 the Ethics Commission released a statement saying the spending cap for District 6 was no longer in effect. John St. Croix, executive director of the commission, has identified at least $90,000 in IEs, including three unreported mailers. “At some point we will attempt to determine who distributed the mailers,” St. Croix said. “But it’s not likely before the election.” The tactic of breaking the law before the election and taking the heat after the ballots are in has been used in the past, and this new example flouts recently passed legislation. These mailings should have been filed with the Ethics Commission, according to an ordinance passed in 2005 in response to similar anonymous hit pieces that came out in the elections of 2003 and 2004 against Supervisors Gerardo Sandoval and Jake McGoldrick. (Sutton defended SFSOS’s main funder, Donald Fisher, in his successful Strategic Lawsuit Against Public Participation against Sandoval over the issue.) “It’s a strategy taken straight from Karl Rove’s playbook,” Meko, a 30-year SoMa resident, told us. Joe Lynn, former Ethics Commission member and staffer, told us “all the committees in San Francisco should turn their backs on contributions from people who are involved in this scheme — at least until they explain their involvement. These are the most sophisticated folks in San Francisco politics. I think a full investigation including possible criminal activity ought to be assigned to a master.” He said District Attorney Kamala Harris used Sutton in her race and therefore may have a conflict of interest. The Rob Black for Supervisor committee claims no connection to the literature that hangs on doorknobs and clogs mailboxes, the push polls calling people, or the postings in the streets and tucked under windshields. “I don’t support the anonymous pieces. If people are doing it on my behalf, I don’t want it,” Black told us. But Daly told us “the IEs appear to be coordinated…. The Black committee is not running a campaign that would be independently competitive. He’s only sent one piece of mail, but he’s had eight sent on his behalf.” Residents suggest it’s even more than that: Walker received three more anti-Daly mailers Oct. 20. Black confirmed that he had only sent one mailing to the district, and he’s “not surprised” that so many IEs have sent out mailings in his support. With the exception of a filing from the Police Officers Association, the only legal IEs reported with the Ethics Commission so far are from the Building Owners and Management Association (BOMA) and Golden Gate Restaurant Association (GGRA). They also trace back to Sutton, Black’s former boss at Nielsen Merksamer, a law firm that represented PG&E in the 2002 campaign against public power, for which the firm was fined $100,000 for failing to report until after the election $800,000 from PG&E, the biggest fine ever levied by Ethics. Sutton left the firm shortly after. Black stayed on until 2004, when he took a position as legislative aide with Michela Alioto-Pier. The most recent poll released by Evans McDonough purports to show Black ahead by six points (with a five-point margin of error). It was commissioned by Barnes, Mosher, Whitehurst, Lauter, and Partners, which has also been employed by Sutton through BOMA and the GGRA for the IEs in the District 6 election. The financial shenanigans have been a rallying point for the Daly campaign. More than 70 volunteers signed in at an Oct. 21 rally and hit the streets: shaking hands, distributing literature, and making phone calls raising support for Daly. Sup. Ross Mirkarimi criticized the soft money’s “ugly, nasty, mean-spirited tactics” to oust Daly. “If they have to resort to these tactics, is that the kind of government we want in San Francisco?” he asked the crowd. “This is the nastiest, most personal and hateful thing I’ve ever been involved with,” Daly said. “It’s very painful.” But, he said, “our people power is better than their money power.” Outside a volunteer shouted into a bullhorn, “Don’t let downtown interests buy your democracy!” SFBG

PG&E’s candidates

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EDITORIAL We’ve seen plenty of allies of Pacific Gas and Electric Co. on the San Francisco Board of Supervisors. We’ve seen a few PG&E bagmen, PG&E shills, and PG&E fronts. But there’s never been anyone elected to the board in our 40 years who was actually a paid attorney for PG&E.
This year there’s at least one and possibly two candidates who have worked as PG&E lawyers — and that alone should disqualify them ever from holding public office in San Francisco. The most obvious and direct conflict involves Doug Chan, the former police commissioner who is seeking a seat from District 4. Documents on file with the California Public Utilities Commission show that Chan’s law firm, Chan, Doi, and Leal, has received more than $200,000 in fees from PG&E in just the past two years.
Chan won’t come to the phone to discuss what he did for the utility, won’t respond to questions posed through his campaign manager and press secretary, won’t return calls to his law firm, and thus won’t give the public any idea what sorts of conflicts of interest he’d have if he took office.
This is nothing new for Chan: back in 2002 he put his name on PG&E campaign material opposing public power and earned a spot in the Guardian’s Hall of Shame.
Then there’s Rob Black, who worked as an attorney for Nielsen Merksamer, the law firm that handled all of the dirty dealings for the anti-public-power campaign in 2002. Black worked with Jim Sutton, his former law professor and PG&E’s main legal operative, during that period but insists he did no work on anything related to PG&E or the campaign. That’s tough to believe.
All of this comes at a time when PG&E is going out of its way, at the cost of hundreds of thousands of dollars, to buff up its image — and to fight the city’s modest but significant plans for public power.
As Steven T. Jones reports on page 16, the notorious utility is well aware that its future in San Francisco is shaky. The city is bidding to provide public electric power to the Hunters Point shipyard redevelopment project and preparing to provide public power to Treasure Island. There is a study in the works to look at developing tidal power. The supervisors are moving forward on Community Choice Aggregation, which will put the city directly in the business of selling retail electricity to customers (albeit through PG&E’s grid). And there’s talk brewing of a public power ballot initiative for next November.
PG&E president Thomas King met with Mayor Gavin Newsom this summer and sent him a nice, friendly letter afterward discussing all the ways the city and PG&E could work together.
But in fact, the utility is already opposing even the baby steps coming out of City Hall: PG&E has bid against San Francisco for rights to sell power to the shipyard, and that’s forced the city to cut prices and reduce the revenue it could have gained from Lennar Corp., the master developer. PG&E is trying to stop the city from selling power on Treasure Island and has financial ties to a private company that has rights to Golden Gate tidal power development until 2008. Meanwhile, the utility just hired the former secretary to the San Francisco Public Utilities Commission — a woman who sat in on every closed-session strategy meeting the panel held, including sessions dealing with litigation against PG&E.
In other words, PG&E is gearing up for all-out political warfare — and the mayor and supervisors need to start preparing too. From now on, people should see whatever PG&E does as hostile — and on every front the city needs to adopt an aggressive strategy to move forward toward eliminating the company’s private power monopoly.
For starters, it’s ridiculous that the city should have to fight PG&E for the right to sell power at the Hunters Point shipyard. The Redevelopment Agency should have made public power a part of the program from the start, and the supervisors should examine that plan immediately to see if it can be amended to require Lennar to buy power from San Francisco. Newsom needs to take to the bully pulpit and say that if PG&E gets this contract, nobody on the Redevelopment Agency Commission will ever be reappointed.
Meanwhile, when Chan and Black appear anywhere in public this election season, they need to be asked to fully disclose their ties with PG&E and outline their positions on public power.
And it’s time for the public power coalition to start meeting again, with the aim of crafting a ballot measure that will create a full-scale municipal system, perhaps as soon as November 2007. SFBG
PS PG&E already has one staunch ally on the board, Sean Elsbernd, a Newsom appointee who also worked in the late 1990s for the Nielsen firm. That’s three too many.
PPS If Newsom is really for public power, as he claims, then why is he pushing so hard for two PG&E call-up votes for the board? And why is he not publicly denouncing PG&E’s attempt to scuttle public power and lending his political capital to a new municipalization effort?
PPPS The SF Weekly’s Matt Smith last week all but endorsed Doug Chan — but made no mention of Chan’s PG&E ties. Did that somehow slip through Smith’s investigative reporting net?

PG&E’s extreme makeover

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› steve@sfbg.com
Mayor Gavin Newsom called a meeting with Pacific Gas and Electric Co. president Thomas King in July to let the utility chief know that the city intended to pursue public power projects on Treasure Island and Hunters Point.
“It was just to tell him that we’re going to do it,” Newsom spokesperson Peter Ragone said of the meeting. “The mayor thought it was a gentlemanly thing to do.”
King used the occasion to start an aggressive new offensive — and to preview PG&E’s latest political strategy.
In an Aug. 10 letter to Newsom, King promised not to fight the city’s plans in court and pledged to develop a better relationship with the city.
“We know that it was in this spirit of cooperation that you approached us last month, and we want to foster this spirit and forge an even stronger partnership in efforts to protect our environment in the years ahead. That’s why I wanted to respond to your questions and suggestions — and to share with you some ideas of my own,” King wrote, listing one of those ideas as helping the city develop energy from tidal power at the mouth of the bay, which Newsom had recently announced a desire to pursue.
The day after PG&E wrote the letter, Newsom and San Francisco Public Utilities Commission (SFPUC) head Susan Leal announced the city’s intention to supply public power, mostly from clean solar and hydroelectric sources, to the redevelopment project on Parcel A of the former Hunters Point Naval Shipyard, where the politically connected Lennar Corp. (which is also part of the team with the rights to build on Treasure Island) has the contract to build 1,600 new homes.
“What we want to provide is a green community at a rate that meets or beats PG&E,” Leal told the Guardian, noting the history of environmental injustices that have been heaped on the southeast part of town. “We’re very excited about what’s going on at Hunters Point. . . . It’s important that the city do the right thing for that community.”
And just as PG&E was pledging cooperation, it aggressively set out to undermine the city’s plans with competing bids and continued its fiercely adversarial posture in another half-dozen realms in which it must work with the city, battles that have cost San Franciscans millions of dollars.
“This is a competitive world and this is fair game, don’t you think?” PG&E spokesperson Darlene Chiu — who used to be Newsom’s deputy press secretary — told us of company efforts to subvert the public power projects.
Last month PG&E also hired away SFPUC commission secretary Mary Jung, who had been privy to closed-session discussions about various city strategies for dealing with PG&E. Jung, who did not return a call for comment, was required to sign a confidentiality agreement and threatened with criminal charges if she spills city secrets, although city officials acknowledge that would be difficult to prove.
PG&E has also launched a high-profile public relations offensive designed to repackage the utility as a clean and green crusader against global warming and a supporter of community programs such as the mayor’s pet project, SF Connect, to which it contributed $25,000 last month.
“The company has a long and continuing history of fighting against the city rather than working with the city on issues involving municipal power, improved reliability, connecting city facilities, and protecting ratepayers,” Matt Dorsey, a spokesperson for City Attorney Dennis Herrera, told us. “If PG&E wants to demonstrate its good corporate citizenship, it can start by changing the nature of its relationship with the city.”
BIG BUCKS
If anyone from the Bay Area needs a reminder about the big money, bare-knuckle approach PG&E uses when its interests are threatened, they need only look up the road to what’s happening in Sacramento and Yolo counties.
PG&E has so far spent more than $10 million fighting Propositions H and I in Yolo County and Measure L in Sacramento County, which together would allow the Sacramento Municipal Utility District (SMUD) to annex more than 70,000 customers in Davis and surrounding communities.
The PG&E effort has saturated mailboxes and the airwaves with messages that inflate the cost of taking over its transmission lines, imply threats of a drawn-out legal battle, and make bold claims of its being an environmentally friendly utility (for example, including nuclear power in its calculations of how “green” PG&E is).
“They’re trying to spread fear and confusion,” Davis-based public power advocate Dan Berman told us. “A new thing comes out every day. But we keep citing the message of lower rates and better service.”
In fact, SMUD has rates that are about 30 percent lower than PG&E’s and a power portfolio that includes significantly more energy from renewable sources than PG&E uses. Even King’s claim that PG&E is “the leading solar utility in the county, having hooked up more than 12,000 solar-generating customers” is misleading. The number is large because PG&E has the largest customer base in the country, but the solar rebates were state mandated and SMUD inspired and come from ratepayer surcharges.
Still, PG&E justifies its aggressive campaign in Yolo County in terms of warding off a hostile takeover of its customers. For residents there and new customers in San Francisco that the SFPUC wants to serve, PG&E’s Chiu repeats the mantra that “we have an obligation to provide services.”
Yet critics of the company say the campaign is about more than just holding on to those customers. Right now more than a dozen California communities are pushing for public power, most involving community choice aggregation (CCA) — which allows cities to buy power on behalf of citizens, potentially bypassing PG&E.
“That’s one of the reasons they’re pulling out all the stops in Davis, because if this goes through, it will embolden other communities,” Barbara George of Women’s Energy Matters told us.
San Francisco was an early city to pursue CCA, but plans to implement it have moved slowly, and now other communities — including Marin County and the cities of Oakland and Berkeley — are even further along.
“San Francisco is way behind in community choice,” George said. “The mayor is giving PG&E a lot of time to put out its claims to be green in order to fight this.”
Part of that push involves a slick 16-page mailer sent out in August by “The New PG&E” outlining “a proposal for an unprecedented and far-reaching partnership with the city of San Francisco to create the cleanest and greenest city in the nation.”
Sup. Ross Mirkarimi — a longtime public power advocate — is skeptical. “I welcome it, but I don’t buy it,” he said. “Their desire to work with us is typically predicated on the receding of our efforts to pursue public power.”
In fact, King seemed to say as much in his letter to Newsom when he wrote, “We see the investment of time, money and political capital in the public power fight as a distraction from the real need — providing clean, reliable and safe power to San Francisco.”
Chiu denied that there is a quid pro quo here, saying, “It is our intent to help San Francisco become clean and green, whether or not it comes with the city’s blessing.”
Yet Leal said the company seems more interested in stopping public power than going green. Rather than trying to undermine the city’s plans for the area, she questioned, “Why don’t they have the rest of Hunters Point, which are already their customers, be a green community?”
COMPETING WITH PG&E
Lennar is expected to announce in the next week or two whether it will go with public power or PG&E at Hunters Point. “No final decision has been made at this point,” Lennar spokesperson Jason Barnett told us.
Yet it didn’t have to be this way. Lennar’s redevelopment project is being subsidized with public funds that could have been conditioned on public power. Even as late as Oct. 17, when the San Francisco Redevelopment Board agreed to change Lennar’s contract to let the company out of building rental units, public power could have been part of the trade-off. Agency chief Marcia Rosen did not return Guardian calls asking why the public agency didn’t take advantage of this leverage.
For her part, Leal said, “I’m not afraid of competition.” It was a point echoed by Ragone, who said Newsom believes the city shouldn’t be afraid to compete with PG&E on Hunters Point or Treasure Island or to stop a PG&E bid to help develop clean tidal power.
But Mirkarimi doesn’t necessary agree. “Why do they have that right?” he asked, arguing the city shouldn’t let PG&E take control of new energy resources or customers who should be served by public power. “The tentacles of PG&E haven’t receded any less at City Hall and we should always be on our guard.”
Leal and Ragone each acknowledged that competing with PG&E isn’t always a fair fight. After all, in addition to having the resources of nearly 10 million customers paying some of the highest rates in the country, PG&E is also alleged in a lawsuit by the city to have absconded with $4.6 billion in ratepayer money during its 2002 bankruptcy, in what Herrera called “an elaborate corporate shell game.” On Oct. 2, the US Supreme Court denied review of a Ninth Circuit Court of Appeal ruling favoring the city, sending the case back to the trial court to determine just how much PG&E owes ratepayers.
That is just one of several ongoing legal actions between the city and PG&E, including conflicts over the city’s right to power municipal buildings, PG&E’s hindrance of city efforts to create more solar sites, and battles over the interconnection agreement that sets various charges that the city must pay to use PG&E lines.
MONEY IN ACTION
A good example of PG&E tactics occurred during the July 26 meeting of the Metropolitan Transportation Commission, which is overseeing work on the Bay Bridge. As part of that work, a power cable going to Treasure Island needed to be moved, but the Treasure Island Development Authority didn’t have the $3.4 million to do it.
So PG&E executive Kevin Dasso showed up at the MTC meeting with a check made out for that amount, offering to pay for the new cable and thus control the power line through which the SFPUC intends to provide public power to the 10,000 residents who will ultimately live on the island.
“This deal with Treasure Island was really egregious. They came in like a game show host and held up a check to try to stop this baby step toward public power on Treasure Island,” said Sup. Tom Ammiano, who also sits on the MTC board. “It shows PG&E is not asleep at the wheel by any means, and anybody who’s elected is going to need to stay vigilant.”
Ammiano was able to persuade the MTC to loan TIDA the money and preserve the city’s public power option. PG&E officials are blunt about their intentions. Chiu said, “We both want to provide power to Treasure Island.” So officials note the importance of being vigilant when it comes to PG&E.
“There will be other meetings where PG&E will wave around $3.4 million checks,” Leal said. “And at some of those meetings, we won’t be there to stop them.”
So public power advocates are concerned that public officials are letting PG&E rehabilitate its public image. Newsom has recently shared the stage with PG&E executives at a green building conference in San Francisco and the Treasure Island ceremony where Gov. Arnold Schwarzenegger signed the landmark global warming measure that PG&E long opposed before ultimately supporting. Ragone said neither these events nor PG&E’s contribution to SF Connect nor his direct dealings with King indicate any softening of Newsom’s support for public power.
“We’re going to do what’s in the best interests of the city of San Francisco,” Ragone said. “This is the first mayor to support public power, and that hasn’t changed at all.” SFBG
To see the letter from King to Newsom and other documents related to this story, go to www.sfbg.com.

Just in: More investment info on PG&E’s candidates for supervisor

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Just as the Guardian went to press on Tuesday afternoon, our investigative interns returned from the Californa Public Utilities Commission with more information on the investments that PG&E has made in supervisorial candidates Doug Chan and Rob Black through two key law firms.

Documents on file with the CPUC show that Chan’s law firm, Chan, Doi, and Leal, has received a total of $460,913 in fees from PG&E between 200l and 2005. In 2002, the year of the second public power initiative, the Chan firm received $49,969.78. Chan lent his name to PG&E for use in PG&E’s campaign material and thereby earned a spot in the Guardian’s Hall of Shame.

As our editorial and my previous blogs pointed out, Chan, his campaign, and his law firm refuse to answer our telephone and email requests for an explanation of what he did for PG&E and whether PG&E’s investment will affect his position on public power. Chan is running in District 4 (the Sunset), backed by Mayor Newsom, PG&E, and downtown money.

Black, a PG&E and downtown-backed candidate against Sup. Chris Daly in District 6, worked as an attorney for Nielsen Merksamer, the political law firm that handled all of the dirty dealings for the nasty public anti-public power campaign that PG&E and its allies waged in 2002 with a huge warchest. Black worked with Jim Sutton, his former law professor and PG&E’s main legal operative, during that period but insists he did no work on anything related to PG&E or the campaign. We and many others find that hard to believe. In any event, he is eloquently vague about his current public power position. Nielsen Merksamer received $338,294 in 200l, the year of PG&E’s first victory over the first public power initiative, and $24,303.90 in 2002, the year PG&E beat back the second public power initiative. In 2003, with PG&E fighting numerous major campaign violations on ethical and campaign spending, Nielsen and Merksamer got $496,7l6.87.

In 2004 the firm got $443,50l.24 and in 2005 it got $8l6,97l. The interns who fought their way through the CPUC bureaucracy were Jeff Goodman and Sara Schieron, adding their names to a long list of Guardian staffers who have helped fight the good fight against PG&E for almost 40 years.

“All of this comes at a time when PG&E is going out of its way, at the cost of hundreds of thousands of dollars, to buff up its image–and to fight the city’s modest but significant plans for public power,” our editorial points out. PG&E is also fighting the city in several expensive legal actions, from conflicts over the city’s right to power municipal buildings to PG&E’s working against the city building more solar sites.

At the end of Steven T. Jones’ story on “PG&E’s Extreme Makeover,” he quotes Peter Ragone, the mayor’s press secretary, as saying, “We’re going to do what’s in the best interests of the city of San Francisco. This is the first mayor to support public power, and that hasn’t changed at all.”

Okay. Maybe so. But then why did the mayor appoint Sean Elsbernd to the board, a staunch PG&E ally who worked for Nielsen Merksamer in the l990s? And then why is he now strongly backing PG&E’s supervisorial candiates in this election (Chan and Black)? That would give PG&E three callup votes on the board for PG&E. Fair play: If Chan and Black aren’t potential callup votes on the board, then they need to come clean, right now, and give us and the public an explanation of the PG&E investments in their firms and what their position on public power is now and will be as supervisors.

SOS: it’s time for the public power forces to regroup and start hammering back at the PG&E offensive. Things of great moment are once again in the making. B3

Chan stonewalls on PG@E questions: will anybody be able to pin him down before the election?

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As our editorial for the Wednesday Guardian states, “We’ve seen plenty of allies of Pacific Gas and Electric Company on the San Francisco Board of Supervisors. We’ve seen a few PG@E bagmen, PG@E shills, and PG@E fronts. But there’s never been anyone elected to the board in our 40 years who was actually a paid attorney for PG@E.

“This year, there’s at least one, and possibly two candidates who have worked as PG@E lawyers–and that alone should disqualify them from ever holding public office in San Francisco. The most obvious and direct conflict involves Doug Chan, the former police commissioner who is seeking a seat from District Four. Documents on file with the California Public Utilities Commission show that Chan’s law firm, Chan, Doi and Leal, has received more than $200,000 in fees from PG&E in just the past two years.

“Chan won’t come to the phone to discuss what he did for the utility, won’t respond to questions posed through his campaign manager and press secretary, won’t return calls to his law firm and thus won’t give the public any idea what sorts of conflicts of interest he’d have if he took office.

“This is nothing new for Chan: Back in 2002, he put his name on PG&E campaign material opposing public power and earned a spot in the Guardian’s Hall of Shame.”

At blogtime last Monday afternoon: still no word from
Chan, his campaign, nor his law firm. (See my blog below for the Guardian questions.) Key question: will anybody be able to pin Chan down on his PG@E connections before the election? Let us know. B3

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