Supervisors

SOS: Vote here on phony PG&E poll

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By Bruce B. Brugmann (Scroll down to vote against PG&E and for the Clean Energy Act)

Already, even before the supervisors approve the new San Francisco Clean Energy Act, PG&E operatives are down the poles like firemen and women.

Their first strike is a poll in the July ll edition of the San Francisco Business Times, a link in the American City Business Journals chain, the nation’s largest publisher of metropolitan business journals, headquartered in Charlotte, North Carolina. The Business Times did a poll for PG&E, a major advertiser, that poses these questions right out of the PG&E playbook with the same tired old PG&E arguments.

“Should voters be asked–for the fourth time in a decade–whether San Francisco should take over the city’s electric utility?

“”Yes. As Supervisor Mirkarimi says, San Francisco voters should finally back ‘removing the profit motive from the private sector delivery of electric service.

“”No, no, no…No. San Francisco can’t make the buses run on time. But it can find power to keep the lights on? Yeah, and maybe it could finance buying out PG&E by selling the Golden Gate Bridge.”

As attentive Guardian readers know, this is nonsense and the Business Times, as a paper that purports to write seriously about business and consumer issues, to act as the voice of PG&E so quickly and so cravenly even before the initiative is approved. Public power is the only new large potential revenue source for the city, would be much cheaper and cleaner than PG&E power, and would be locally accountable to the local public. More, it would finally bring the city into compliance with the federal Raker Act, which mandates public power for San Francisco because the Raker Act allowed the city a major concession to dam Hetch Hetchy Valley in Yosemite National Park for our water and power supply.

Cast your vote below. For early evidence of PG&E’s emerging campaign of lies, misdirection and astroturfing, read last week’s Guardian by Amanda Witherell. For the case to “Support SF’s Clean Energy plan,” read the editorial below in the Wednesday Guardian.

Alert: The Supervisors’ rules committee will hold a critical hearing on the initiative at 2 p.m. Wednesday at City Hall, Room 273, item eight on the agenda. Attend if you can and stay alert for more PG&E shenanigans. On guard, for the big battle ahead, B3, who is counting on the clean energy movement to knock out the Potrero HIll power plant tthat I see every day from my office window

Click here to vote in the San Francisco Business Times’ survey.

Click here for this week’s editorial, Support SF’s Clean Energy Act.

Click here to read last week’s article by Amanda Witherell titled, The dirty fight over clean power

The dirty fight over clean power

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› amanda@sfbg.com

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

Fighting for the right to party

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› steve@sfbg.com

It’s become increasingly difficult and expensive to stage street fairs, concerts, or other parties in San Francisco, a trend chronicled by the Guardian over the past two years (see "Death of fun," 05/23/06 and "Death of fun, the sequel," 04/25/07). But event and nightlife promoters have responded with a proposed ballot measure that would write the right to party into the city’s charter.

The "Promoting and Sustaining Music and Culture in San Francisco" charter amendment would acknowledge the importance of special events to the city’s character, streamline the process for obtaining city permits, and require the nine-plus city departments that promoters must deal with to submit reports outlining how their policies and fee structures will need to be altered to comply with the new mandate for fun.

The measure was developed by the Save SF Culture Coalition, whose members include the Entertainment Commission, Black Rock City LLC (which stages Burning Man as well as events here in town), the Late Night Coalition, and the Outdoor Events Coalition (a group formed last year to counter city policies and neighbor complaints that threatened to scuttle the North Beach Jazz Festival, How Weird Street Faire, concerts in Golden Gate Park, and other events). The measure is sponsored by Sup. Ross Mirkarimi and has picked up four other supervisors as cosponsors, so it needs just one more vote for the Board of Supervisors to place it on the November ballot.

"It was long overdue that the city produce a master plan and vision that promotes a sustainable environment for music, culture, and entertainment throughout the city," Mirkarimi said.

In fact, event promoters say they’ve been hit by a quadruple whammy that threatens their livelihoods and the vibrant nature of the city: rising fees charged by city departments looking to close budget gaps, increased concern over alcohol consumption and other liability issues, more conflicts over noise in increasingly dense neighborhoods such as SoMa, and the ability of a handful of complaining neighbors to create event-killing permit conditions. And those last two problems are only likely to get worse as the city grows.

"We want the city to create a sustainability policy that will save our outdoor events in the face of all the development that is going on," said John Wood, a member of the Late Night Coalition and a promoter who also serves on the San Francisco Love Fest board of directors. "We need to be able to say, ‘This is city policy and you’re not following it.’"

Promoter and club owner Terrance Alan was an original member of the Entertainment Commission, which was formed in 2003 in part to resolve complaints over noise and manage relations between nightclubs and their neighbors. But he said the agency has little staff and no leverage over other city departments involved in permitting, which includes the Planning, Building, Port, Police, Fire, Health, and Recreation and Park commissions and departments, as well as the Municipal Transportation Authority and Interdepartmental Staff Committee on Traffic and Transportation (ISCOTT), the body that approves street-closure permits.

"We have been completely unsuccessful at getting their attention," Alan said. But this new measure, he said, would "set the stage for ongoing discussions that need to be happening."

Or as Wood put it, "It would give us ammunition in the future battles we’re going to have. It’s not going to make those battles go away."

Recreation and Park Department spokesperson Rose Dennis said her agency must deal with many competing concerns, ranging from budgetary issues to being responsive to complaints raised by citizens. "We understand that it might feel heavy-handed, but we have a duty to do so because we have to balance a number of concerns," Dennis said. "[Event promoters] have a bottom line, and we have a bottom line. We have a lot of people to serve."

Yet she said the department will comply with the measure and adjust its policies, fees, and procedures as needed if the measure is approved by voters.

At a June 27 Board of Supervisors Rules Committee hearing, there was lots of support for the measure and no real opposition. "We’re concerned about the future of arts and culture in San Francisco," Steven Raspa, who does special events for Black Rock City, said at the hearing.

All three committee members voiced support for the measure, but because it needed some minor changes, a final vote was pushed back to July 9. Proponents characterize the measure as trying to bring some balance to a situation in which the loudest wheels — those of NIMBYs complaining about noise or party detritus — keep getting greased.

"The bureaucracy is hearing from these neighborhood groups all the time," Wood said. "We feel that we are the majority and we need to demonstrate that politically."

Amanda Witherell contributed to this report.

To read the measure or learn more, visit www.savesfculture.com

Save SF’s campaign finance program

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OPINION In 2000, San Francisco voters approved a system of public financing of campaigns for the Board of Supervisors, which in 2006 was expanded to the mayoral race. By eliminating the need for candidates to raise large amounts of private money, the program has been extremely successful at helping sever the link between big money and political decisions. But now this flagship program is threatened: Mayor Gavin Newsom is proposing to raid several million dollars from the public campaign fund.

Last September the mayor put forth a plan to take $6 million from the fund and give it to one of his pet programs: SF Promise. The cost of this program was only $525,000 the first year, begging the question of why the mayor was grabbing $6 million from the fund. Of course, Newsom had actively opposed public financing for the mayoral race, so it’s possible he wanted to defund the program. Supervisor Aaron Peskin wisely introduced legislation to fund SF Promise from the city’s reserve funds, thereby warding off the raid.

Now another proposal has surfaced to remove $5 million from the fund. According to Ethics Commission spending projections, removing $5 million will create a $1.7 million to $4.3 million shortfall for the next mayoral race in 2011 — and that’s just to meet minimum baseline funding.

The justification for this plan is that the city is facing a budget crunch and needs these funds. The mayor promises, promises, promises to return the funds later — but the only way to legally secure those funds is through a charter amendment, which the Mayor’s Office has declined to support.

This latest rationale rings hollow, and we only have to look across the bay to see why. Earlier in the decade, Oakland adopted public campaign funding, and after it was used in one election cycle, Oakland was hit with a budget deficit. The City Council decided to dip into the public financing funds in the gap. They promised, promised, promised that they would restore the funding once the deficit problems were resolved. Yet to this day Oakland still does not have public financing of campaigns — because, while it’s still the law, there’s simply no money in the fund.

Meanwhile, in San Francisco, members of the Budget Committee seem to be prepared to vote in favor of this dangerous proposal as early as July 3. While Supervisors Ross Mirkarimi and Chris Daly have wisely expressed opposition, Supervisor Jake McGoldrick, who has been a public financing supporter in the past, has so far expressed support for the cut. McGoldrick could end up being the swing vote, joining with public financing opponent Sup. Sean Elsbernd and mayoral ally Sup. Carmen Chu to support this legislation.

Dipping into the public financing fund for any reason sets a terrible precedent and undermines the integrity of this valuable program. Just as politicians should not draw their own district lines because of a conflict of interest, they should not undermine previously established campaign finance laws.

Rob Arnow and Steven Hill

Rob Arnow and Steven Hill have been the architects of public financing for mayoral and Board of Supervisors elections. Steven Hill also is director of the Political Reform Program at the New America Foundation. Contact them at info@voterownedelections.org.

 

Peskin for DCCC chair

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EDITORIAL The San Francisco Democratic County Central Committee was the sleeper election in June: The Mark Leno–Carole Migden–Joe Nation contest for state Senate got a lot of attention, and the Bayview–Hunters Point redevelopment project got a huge amount of money, but only a small percentage of the voters got to the bottom of the ticket and chose the 24 people who will set policy for the local Democratic Party for the next two years. But a progressive slate won a significant number of seats. Now the DCCC has become a heated political battleground, with two candidates vying to become party chair.

The incumbent, Scott Wiener, leans toward the more moderate wing of the party, although he’s taken progressive stands on some issues. The challenger, Sup. Aaron Peskin, has the strong backing of many progressives.

The race has gotten a bit nasty: Sup. Chris Daly, a Peskin supporter, has sent out e-mail threatening the political future of committee members who don’t vote the right way. Both sides are lobbying furiously, with Leno helping Wiener and progressive leaders pushing Peskin. Right now it’s too close to call the election, which takes place later this month.

We’re not happy with the level of animosity here. We recognize that this isn’t the presidency of the United States, and that, thanks to the influence of the reform slate, the DCCC chair is no longer as powerful a position as it was in the days when the late Phil Burton and former Mayor Willie Brown controlled the party with an iron hand. And with the committee this closely split, neither candidate will be able to run an effective party operation this fall without working with both sides. So this shouldn’t be a political bloodbath.

We also recognize that neither candidate is perfect. We’ve disagreed with Peskin on a number of key issues, including Home Depot, and frankly, it’s not ideal to have the president of the Board of Supervisors also running the local Democratic Party.

But like any political contest, this ought to be decided on the issues — and on the future of the San Francisco Democratic Party. And Peskin is the clear choice.

If the DCCC did nothing but raise money, register voters, and push Democratic candidates, this wouldn’t be such an important fight. Weiner has done a perfectly fine job of keeping the party well funded and, under his tenure, 15,000 new Democratic voters have joined the ranks. But the party also endorses candidates and takes stands on ballot measures, and in close races — as some of the key battles will be this fall — the party’s support (which includes party money) can be significant.

And while the chair has only one vote, and can’t decide endorsements unilaterally, the person who runs the local party has a fair amount of influence over how money will be spent and how DCCC slate cards are managed; if the job didn’t matter, these two people (and their powerful allies) wouldn’t be fighting over it.

Peskin is on the right side of all the key fall contests. He’s backing progressive candidates for supervisor in the swing districts (John Avalos in District 11, Eric Mar in District 1, and David Chiu in District 3). He supports the housing justice initiative, is the cosponsor of the public power charter amendment, and the sponsor of two progressive tax measures. Wiener supports Ahsha Safai, the candidate of downtown and Mayor Gavin Newsom, in District 11. He hasn’t taken a position on public power, and told us he has "significant concerns" about the cost of the affordable housing measure, although he supports both of Peskin’s revenue proposals.

Wiener has been a reasonable and fair person as chair. But the issues matter. And if the San Francisco party is going to become a center for progressive activism, if the DCCC is going to be willing to challenge the state and national party and its leaders when necessary, take in the mayor when he’s wrong, and push the party to the left, putting a more activist progressive in the top slot is crucial.

It’s still possible a third candidate could come along. But for now the choices are Peskin and Wiener, and we urge progressives on the panel to support Aaron Peskin.

PS: As Amanda Witherell reports on page 14, PG&E is madly, desperately fighting to keep public power off the November ballot and is using every misleading figure and dirty trick possible. So the DCCC chair has to be willing to stand up to PG&E without hesitation or doubt.

Clean Energy Act excites supervisors

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At today’s Rules Committee, Supervisors Bevan Dufty, Tom Ammiano, and Chris Daly, all expressed enthusiasm for San Francisco’s Clean Energy Act. Daly and Ammiano even broke into chants of “victory, victory” during discussion of approving the measure for November’s ballot.

“In 2002 I supported Prop D and I look forward to supporting this measure,” said Dufty during his comments on this new public power ballot initiative. “I think PG&E has not held the public trust in San Francisco well,” he added, citing the smear campaign PG&E launched against Mark Leno during his bid for State Senate.

The measure, known as the “San Francisco Clean Energy Act,” would amend the city charter to require that, within 120 days of passing the legislation, the San Francisco Public Utilities Commission must “produce a comprehensive plan for providing clean, secure, cost effective electricity for city departments and residents and businesses.” This may include construction city-owned transmission lines, as well as procuring the resources to advance the Community Choice Aggregation plan of 51 percent renewables by 2017.

It actually goes one step farther and says if CCA falls through, the city must still get 51 percent of their energy from renewable and clean sources, 75 percent by 2030, and 100 percent by 2040. A green jobs workforce development must also be part of the plan, and if it’s determined that public ownership of the grid and resources is the way to go, any employees fired by PG&E, the private company that provides our power now, will be hired by the PUC.

Sup. Ross MIrkarimi, who introduced the measure, rattled off figures from Alameda, Santa Clara, Palo Alto, and Sacramento, all of whom have publicly-owned utilities and all of whom charge the average household rates far below PG&E.

His figures, for a 500 kilowatt hour household:

MUD money

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

The Chamber attacks public power

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The SF Chamber of Commerce is getting itself all into a frothy lather over the prospect of a public-power campaign, and the email that the Chamber sent out today is full of insanely inaccurate iinformation.

Here’s the email and a few notes on its most bizarre claims:

This Friday, June 27 at 10:00am at City Hall, Room 263 the Rules Committee will consider a measure that would put the City in control of our power system. The cost of this measure will be billions of dollars, paid for with higher utility bills, especially for business.

The cost to buy the PG&E electric system in San Francisco in 2010 is presently expected to beat least $4.02 billion. This is only a preliminary estimate, the final figure could be substantially higher. When you include the interest payments on the bonds and the associated severance and financing costs, the ultimate cost for a takeover will be more than twice that amount.

WHAT? Where do you suppose that $4.02 billion came from? It clearly didn’t come from any realistic study. PG&E’s dilapidated, poorly maintained distribution system is probably worth less than $500 million — and even if the city had to pay twice that much, it would be more than worthwhile when you look at how much revenue would come in.

San Franciscans Will Pay to Replace the Lost Tax Revenue

Taking over PG&E means removing PG&E from the tax rolls. That will cost taxpayers over $25 million annually in lost franchise fees, payroll taxes, property taxes, and direct contributions from PG&E. Those taxes and payments will need to be replaced – or services will need to be cut. The City is now facing one of the most severe budget shortfalls ever. The power system takeover will make this budget gap at least $25 million worse. Again, there is no current plan to replace this lost revenue. The PG&E takeover means either service cuts and layoffs – or another massive tax increase.

HUH? The $25 million the city would lose would be more than replaced by the money — several hundred million at least — that the city would gain in extra revenue from running a municipal utility.

We’ll All Pay the Price of Putting City Hall in Charge of our Power System

Right now, PG&E is regulated by the State of California. But a city-run power system would be exempt from most state regulations, giving the Board of Supervisors the power to make some customers pay more so others can pay less, siphon away funds needed for the retrofit of the Hetch Hetchy water system and delay investments in the safety and reliability of our energy grid.

WELL, actually the supervisors could mandate renewable energy — which PG&E isn’t doing.

So the battle is already underway, and already, PG&E’s mouthpieces are putting out wildly misleading data.

Should be a great hearing tomorrow.

Clean Energy — tomorrow!

1

The Board of Supervisors Rules Committee will hold a hearing tomorrow (Friday) to discuss the new clean-energy charter amendment. It’s a long-overdue measure that would give San Francisco control of its own energy future and set aggressive mandates for sifting to renewable resources for electricity.

The measure is sponsored by Supervisors Ross Mirkarimi and Aaron Peskin, and includes the following:

1. A mandate that 51% of the city’s electricity is generated from renewable resources by 2017, 75% by 2030, and 100% by 2040. This would be one of the few laws in the country that requires a city to move toward a 100 percent renewable portfolio. It also requires the Public Utilities Commission to issue a report every two years explaining how the city is meeting those goals. This would be a model for cities around the nation (and around the world), and would put San Francisco in the forefront of the movement to reduce carbon emissions and slow climate change. Since state and federal governments are moving far too slowly on the most important environmental issue of our lives, cities are going to have to take the lead, and San Francisco – one of the most progressive communities in the nation — should be showing everyone else how to do to that.

2. A mandate that the city move toward acquiring its distribution system for the sale of electricity. Pacific Gas and Electric Company, which now supplies the residential and business customers in San Francisco, is spending a huge amount of money on a greenwashing campaign to convince residents that it’s moving away from fossil fuels. That’s a big lie: PG&E’s current power profile is 44 percent fossil fuels, 24 percent nuclear, 20 percent large hydro, and only 12 percent renewable – and the utility admits that it will not even make the state’s mandate of 20 percent renewable by 2010. . The only way this city is going to have a truly environmentally sound energy program is if we run it ourselves.

Of course, a publicly run utility has other big advantages. Public-power agencies all over the country have lower electric rates and many bring in huge amounts of revenue, which the city desperately needs. And public-power is good for the economy

3. Mandate green jobs and job training for San Franciscans. There’s a lot of money in renewable energy, and thousands and thousands of good jobs. The measure mandates that the PUC as part of creating a public power agency create job-training programs to help San Franciscans build careers in green energy.

The hearing is at 10 am. Be there and support this crucial legislation.

The problem with city planning

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I’m always intrigued when civic-improvement types talk about the problems with city planning in San Francisco — and harp on the fact that it takes too long to get anything done and that the same old naysayers are too powerful. The latest is a piece by David Prowler, former planning commissioner, that appeared on BeyondChron.

Among the Prowlerisms:

Forget about consensus. We’re not going to get it, and too often the planners or the Board of Supervisors delay decision-making while waiting for it. But it gets farther away. We need leadership, not consensus.

TRANSLATION: Who cares what the community thinks; leave the big decisions to elected officials who the developers can effectively lobby.

Let’s be frank and clear about what land-use planning can and cannot do. It doesn’t by itself create buildings or good jobs. The City is trying to preserve blue-collar jobs by zoning to prevent housing (It’s been characterized as “zoning for gold mines and expecting gold”). But how about linking zoning with a strategy to create these jobs?

THE PROBLEM: No, land-use planning can’t always create good things, but it can sure as hell destroy things, and has done so for decades in San Francisco. Redevelopment didn’t create much in the Western Addition, but it destroyed a community. No, good zoning won’t create blue-collar jobs — but bad zoning will destroy them.

Reconsider CEQA. We discuss projects and plans within the framework of the California Environmental Quality Act, best known by the acronym CEQA, which mandates addressing only how much damage can a proposal do to the environment, not how can it help the city meet goals or help the regional environment by concentrating growth where there’s infrastructure. Here in San Francisco, we hold up even small-scale projects, such as the 17 residences and retail uses proposed at the empty lot at 19th and Valencia streets by the longtime residents and owners of a popular Mexican restaurant. Really, in a built-up city, along a transit street where just about every other spot is housing over stores, how much environmental damage could a project like this do?

TRANSLATION: Get those pesky project foes out of the way and take away any tool they have to preserve their neighbhorhoods.

This kind of stuff infuriates me. The problem with city planning is very simple, and I can phrase it in one sentence: Planning in San Francisco is driven almost entirely by private developers and exists to serve their interests and needs.

And of course, although it doesn’t say so in his piece, David Prowler is a developer.

Free solar power?

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› sarah@sfbg.com

GREEN CITY San Francisco’s new solar incentive program just might make the conversion to green power almost free to city residents when combined with other state and federal programs, some of which expire at the end of this year.

This is an unlikely city for such a dynamic, as we reported a couple months ago (see "Dark days," 04/16/08), given our small lot sizes, high costs, and the fact that we have about twice as many renters as homeowners. The solar program also hit some political snags.

Promoted since December 2007 by Mayor Gavin Newsom and Assessor/Recorder Phil Ting, the Solar Energy Incentive program has been struggling to get Board of Supervisors approval since January when Sups. Chris Daly, Jake McGoldrick, Ross Mirkarimi, and Aaron Peskin objected to the use of public money to fund the program, which will subsidize solar installations on private homes and businesses.

These San Francisco Public Utilities Commission funds were intended to expand publicly owned power projects such as solar panel installation on city property. But as the SFPUC’s Barbara Hale explained to the Guardian, new laws prevent cities from qualifying for state rebates if they convert municipally owned buildings to solar, making those conversions a comparatively losing financial equation.

So on June 10, the board approved Newsom’s program in an 8-3 vote, with Mirkarimi lending his support after he secured funding for a complementary $1.5 million, one-year solar pilot program targeted at nonprofits and low-income families. The San Francisco Solar Energy Incentive program will provide $3 million in solar rebates annually for 10 years.

As Mirkarimi aide Rick Galbreath told the Guardian, "Nonprofits can’t always move as fast as the private sector, and solar advocates, who have been pushing other programs since December, have already got things in the pipeline."

Some of those other programs combine with the new city one in interesting ways. "What if solar were free? Then everyone would install it, right?" was the question posed by Tom Price, whom we profiled in January (see "Solar man," 01/02/08) for founding Black Rock Solar, which does large public interest solar projects using volunteer labor.

Now Price thinks the free solar power that he’s been able to leverage for schools and hospitals just might be available to the average San Franciscan. "This program inadvertently could make solar in San Francisco the cheapest it’s ever been," Price told us. "At least for a short window of time."

Under the city’s program, solar rebates begin at $3,000 for homeowners — and rise in $1,000 increments to a maximum of $6,000 if residents use local installers, hire city-trained workers, and live in city-designated environmental justice districts. For private businesses, the rebate cap is set at $10,000. But that amount can rise if combined with the state and federal incentives that expire at the end of the year.

"I’m one of three tenants. Each of us has an electrical meter, each of us is eligible for a $5,000 rebate under the city’s program," said Price, who rents on Potrero Hill and hopes to pull off an almost no-cost conversion with his landlord.

Price estimates the solar conversation will cost about $15,000 per tenant. So, if two conversions are done (there’s only space for two conversions on most of the city’s Edwardian and Victorian homes), Price’s landlord can subtract two $5,000 cash rebates, plus the Pacific Gas and Electric Co.–administered California solar incentive, plus a $2,000 federal tax credit.

Price said landlords can also take advantage of a 30 percent investment tax credit on top of a 60 percent tax deduction that Dave Llorens of Next Energy found buried deep within the economic stimulus package signed by President George W. Bush earlier this year. Landlords can then arrange to sell cheap, renewable power to their tenants.

"What if I sign an agreement with my landlord to pay $50 per month for the right to have access to his solar system?" Price said. "So now the money that would have been going to PG&E goes to the landlord."

And it’s clean, free power, rather than PG&E’s expensive power generated largely from nuclear and fossil fuel sources.

"This makes San Francisco the first place a tenant and a landlord can really work together to make solar power affordable," Price said. "And that in turn will help drive adoption of renewable energy."

Editor’s Notes

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› tredmond@sfbg.com

The San Francisco Chronicle has suddenly discovered that the middle class is leaving San Francisco.

Staff writer James Temple broke the news on the front page of the Sunday, June 23 paper with a lead sentence that boggles the mind in its insight and news value: "The number of low- and middle-income residents in San Francisco is shrinking as the wealthy population swells, a trend most experts attribute to the city’s exorbitant housing costs."

I don’t want to downplay the importance of this story. It could have (and should have) been written a decade ago, when Willie Brown was mayor and city planning policy, combined with the dot-com boom, started San Francisco on the path toward becoming the first fully gentrified big city in America. And I’m always frustrated when a daily newspaper reports after the fact on something that could have been prevented, or at least slowed, back when the story first became a story.

But the news is still news today, and the fact that the Chronicle has facts and figures and demographers denouncing and community leaders deploring means the problem will be getting some additional attention this fall. That matters, because this November, the future of San Francisco will again be on the line.

And that could be a very good thing.

Calvin Welch, who has been fighting for a progressive city longer than many of today’s activists have been alive, remembers the summer 1972 state ballot: "You had George McGovern. You had the Coastal Commission [Act]. You had the farmworkers [labor law]. You had marijuana [decriminalization]. And you had every constituency on the left coming out to vote for them all. And they all won."

This fall in San Francisco we will have perhaps an even greater perfect storm: a proposed rebuild of SF General Hospital, which is a huge priority for organized labor. A housing justice measure that sets aside money for affordable housing (and could help address the single biggest issue in the city, something even the Chronicle now puts on page 1). A green energy and public power measure (which would shift energy policy toward renewables and bring in millions of dollars). Two new revenue measures that tax the wealthy. Six seats on the Board of Supervisors, including three swing districts that will determine whether the progressive majority that has controlled the board since 2000 will remain intact. And all of that will happen in the context of the Obama campaign and a massive statewide mobilization to protect same-sex marriage.

We are a fractious crew, the San Francisco left, but if we can come together this fall, share resources, and run some sort of large coalition campaign for progressive values, this could be an election for the ages.

The commissioner’s conflicts

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› gwschulz@sfbg.com

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

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

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

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

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

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

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

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

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

RECUSE ME


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

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

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

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

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

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

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

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

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

TOO CLOSE FOR COMFORT


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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

Hustlers and peace treaties: This week’s cover

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“It’s something bout a block boy that push that line, ride for the peace treaty and hustle at the same time, looking out for my brah brahs cause life’s too short, especially when the suckas telling and got homies in court.”

-JT the Bigga Figga on the Fillmore neighborhood

For this week’s cover story on the Ella Hill Hutch Community Center, the Guardian did a few things we thought might strengthen the reporting for the piece. We read hundreds of pages of law-enforcement records filed by the city attorney in last year’s gang injunction cases. We also collected extraordinary historical details about Ella Hill Hutch herself, the first black woman elected to San Francisco’s Board of Supervisors.

During the time we worked on the story, journalist Alex Kotlowitz, who’s mostly been missing in action since publishing his ground-breaking 1991 book on public housing in Chicago, There Are No Children Here, happened to write an extensive story on gang intervention efforts for the New York Times Magazine, which is well worth the read.

In the meantime, a little about Ella Hill the supervisor. In 1980, she endured a grueling reelection campaign that drove her literally to the point of exhaustion. She was admitted to the hospital with pneumonia weeks after placing a surprising fourth in a citywide race. Three months later she uncharacteristically missed a Finance Committee meeting on Feb. 25, 1981, and police eventually found her dead of heart failure at her small Scott Street apartment.
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Budget Battle bumps up against Gay Marriage

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bridalmoneybag.jpg
Bridal Money bags are sexy, budget documents ain’t.

As LGBT couples were praising Mayor Gavin Newsom for making legally wedded bliss a reality in their lifetimes, a parallel community inside City Hall was criticizing the Mayor for making potentially fatal cuts to public health programs, many of which have served San Francisco’s LGBT community for decades.

Unfortunately, between all the gay marriage hoopla going on in the marble corridors of City Hall, and the burn out that non-profits are already feeling having suffered crippling mid-year cuts, there was an unprecedented feeling of doom and gloom during this year’s Beilensen Hearing inside the Board of Supervisors’s chambers.

The Beilensen Hearings, which the state requires when cuts are proposed to public health programs and services, have become an annual dance, which goes like this: first the Mayor proposes massive cuts, then the Board tries to restore funds, next competing rallies are held, and finally most of the programs are restored,

Only this year, there is little to no money to be found.

During his June 2 budget annoucement, Mayor Gavin Newsom pointed out that while the City is facing a record $338 million deficit, it is also is seeing healthy increases in tax revenues.

So, why such a massive imbalance this year? Newsom claims we are spending more than we are taking in, but that answer sidesteps the political reality of just why that is happening on such a greater scale, this year.

The answer to that question lies in two directions: Newsom’s approval, and the Board’s largely unflinching support (Sup. Chris Daly was the lone dissenting voice) for union contracts last summer, when the Mayor was up for reelection; and Newsom and the Board’s failure to introduce legislation last year to create new revenue streams to make up for the increasing slice of funds that those same union contracts, predictably, are swallowing up.

To their credit, Board President Aaron Peskin (who celebrated his birthday June 17, just as gay marriage mania was hitting City Hall big time) and Sup. Jake McGoldrick, who chairs the Board’s powerful Budget and Finance Committee, have now bitten the bullet and introduced legislation that seeks to increase property transfer taxes and close the pay roll tax partnership loophole.

But even if these measures are approved, (and that’s a big if, they won’t ease this year’s budget pains.

What could help, on a more immediate level, is the identification of significant savings within the Mayor’s proposed 2008-09 budget. And to that end Budget Committee chair McGoldrick has dug his claws deep into Newsom’s proposed budget document and drawn blood.

This blood letting began ast week, when McGoldrick led the charge against funding the Mayor’s proposed $3 million Community Justice Center. (The proposal got sent back to committee where it will likely fester, and the Mayor has responded by placing a measure on the November ballot that would allocate $1.8 Million in city funds and earmark an additional $984,000 in federal grant money to create the proposed center.)

And at yesterday’s Board meeting, McGoldrick told me that he has identified potential savings of $8-10 million from the San Francisco Police Department, including eliminating over staffing as well as defunding two out of the Mayor’s three proposed police academies.

“Any claims that they are understaffed are not true,” said McGoldrick, who says he came to this conclusion by factoring in 129 civilianized positions into SFPD staffing totals.

“And I’ve already told the Mayor and the Chief of Police that they are not going to get three police academies, and that the Mayor’s 311 Center is not getting 26 new positions,” McGoldrick continued. “We are going to have to figure out a more efficient way to run it. This is all about priorities. My priorities are the sick, the shut-ins, the elderly, children, the mentally ill and the victims of domestic violence.”

Meanwhile, Sup. Chris Daly extracted hollow laughs when he announced that he would not make the exact same speech as he did at last year’s Beilenson Hearing.

Daly was referring to his now infamous speech in which he referred to “allegations of cocaine use,”—allegations that were whispered around town, after it was revealed that Newsom had had an adulterous affair with the wife of his then campaign manager Alex Tourk, but that were never proven and thus would have been better left unmentioned in a public hearing that was seeking to illuminate Newsom’s wacky budget priorities..

But because Daly mentioned them, the media, which doesn’t like covering budget hearings, since there’s nothing sexy about covering hours of testimony in which people describe , over and over, the devastation that proposed cuts will have on their programs, happily refocused its lens on the alleged inappropriateness of Daly’s speech, thereby helping the Mayor get off the hook for proposing cuts to substance abuse treatment programs, in the same year he claimed to be undergoing alcohol abuse therapy.

Or maybe it was because that in this LGBT-friendly town, Newsom will always be remembered as the patron saint of gay marriage, and because of his sainthood voters will largely absolve him of all his other sins, including making decimating financial cuts to public health programs that have helped the LGBT community for decades.

Either way, this time around, Daly, (while complaining that the Beilenson hearing should happen in front of the Mayor), didn’t bother to imply that Newsom had somehow lost his moral compass.

Which was probably a wise l move, given that at that very moment the Mayor was being elevated to international renown for having pushed the gay rights envelope all the way to the wedding altar, at a time when the rest of the Democratic Party, fearing another four years of President Bush in 2004, was whimpering “too much, too soon, too fast.”

Instead, Daly commented that his district will likely look like “the Night of the Living Dead” once Newsom’s proposed budget cuts go into effect,

Daly also introduced the “Treatment on Demand Act,” which “requires that the City and County of San Francisco “maintain an adequate level of free and low cost medical substance abuse services and residential treatment slots commensurate with demand.”

Daly’s act measures demand, “by the total number of filled medical substance abuse slots plus the total number of individuals seeking such slots as well as the total number of filled residential treatment slots plus the number of individuals seeking such slots.”

But for now, it’s budget hearing season, and advocates like Bill Hirsch of the AIDS Legal Referral Panel are telling the Board how they believe the Mayor’s proposed cuts amount to “a dismantling of a system of care that has taken over 25 years to put together.”

“We’re terribly disappointed with the mayor’s Budget,” Hirsch said, against a soundtrack of whoops of joy as gay couples celebrated their weddings outside the Board’s chambers.
“Hopefully, the Board can help prevent the worst of this.”

Others, like Connie Ford of Office Employees Local 3, which represents 800 non-profit workers, called the 22 percent cuts that the Department of Public Health is facing, “the most chaotic, unstrategic and ill-advised cuts” she’d ever seen.
“We’ll hurt people and the cuts will actually cost us more money” Ford said. “There is no rhyme or reason to these cuts.”

FelicianHouston, program director of a Woman’s Place, said that the proposed cuts are a “reflection of the dismantling of the continuum of care.”
“Just don’t do it.” Houston said.

And the list of speakers went on and on, including representatives for suicide prevention, crystal meth intervention, and mobile assistance patrol programs.

“Studies show that for every one dollar spent on substance abuse treatment seven dollars are saved at the law enforcement level” said several speakers. It’s a comment that brings us full circle to the insanity of proposing to start new programs, like the Community Justice Center, while proposing to slash the programs that would serve that center.

Stay tuned for move coverage of this and other budget insanities, between now and the end of July, when the annual budgetary approval cycle is scheduled to be resolved.

Another shelter down

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› amanda@sfbg.com

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

*

Avoiding a Lennar meltdown

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EDITORIAL Millions of dollars in campaign money kept Lennar Corp.’s plans for southeast San Francisco alive. But the financial news isn’t looking good for the giant homebuilder — and the San Francisco supervisors ought to be worried.

Last week, Sup. Chris Daly released a document he obtained from the Redevelopment Agency showing that the city had quietly sought a $25 million grant from the state Department of Housing and Community Development to cover a projected loss in Lennar’s Hunters Point Shipyard project.

The problem: increased construction costs, trouble in the financial markets, and unforeseen environmental issues have eaten up all the money that Lennar and the city had made available for infrastructure improvements on the site. That means the roads, water and sewer pipes, and other basic stuff that project will need to go forward are no longer adequately funded. Without an influx of state money, the city argued, the whole shipyard project would either be "drastically reduced in scope" or put on hold for another two or three years.

"Without the requested $25,021,079 Infill grant allocation, our infrastructure project faces a serious risk of being mothballed," city officials wrote. As Sarah Phelan reported at sfbg.com, the state rejected the application last week.

The shipyard project is the first piece of Lennar’s grand-scale Bayview Hunters Point redevelopment — and it’s already in serious financial trouble. The same issues that are causing problems at the shipyard will be in play when Lennar starts work on the 10,000 new housing units now approved for the Bayview–Hunters Point redevelopment area. Construction costs will be even higher in a year or two. The end of the mortgage crisis is not yet in sight. As Daly told us, the shortfall in the first part of the project "casts a very large shadow on the mixed-use development envisioned under the conceptual framework on Proposition G."

Then on June 8, a Lennar subsidiary that’s working on redeveloping the Mare Island Naval Shipyard property filed for Chapter 11 bankruptcy. That project is now in limbo as the development consortium — facing economic pressure and unable to get the necessary financing — seeks protection from creditors. Combined with the fact that Lennar’s bond ratings continue to tumble (Lennar debt was downgraded again June 10), San Francisco officials ought to be asking the obvious question: can this Miami-based developer actually pull off this project? Or is it possible that after all of the political debate over the Lennar plan, the lack of adequate affordable housing, the future of the 49ers, the toxic contamination of the site, and everything else, the entire massive project could collapse because Lennar doesn’t have the financial ability to finish it?

This, of course, is one of the inherent problems with the traditional redevelopment model. The city essentially will be giving a huge piece of public land to a single private company that will then be responsible for building an entire new neighborhood with homes, offices, stores, and parks. In theory the developer will make enough money to stay afloat until construction is finished — and the property taxes in the area will increase enough to fund necessary infrastructure (schools, roads, bus lines, water and sewer service, and other public amenities). But if the developer goes broke, the city is left hanging.

That’s what’s happening in Vallejo, where a city that already has serious financial problems is facing the possibility that environmental cleanup at Mare Island will grind to a halt, and that a $6 million municipal service fund — paid for in part by Lennar — could suffer.

The prospects for San Francisco could be far worse. Suppose the city goes ahead and transfers public land to Lennar — which then goes into bankruptcy. Would that city land be treated as a private asset and given over to whatever creditor or vulture fund picks up Lennar’s ghost?

Fred Blackwell, the director of the Redevelopment Agency, won’t return our phone calls, but the supervisors need to hold a hearing on this and force him and Lennar to provide some answers. The board needs an independent audit of Lennar’s finances, either by Budget Analyst Harvey Rose or an outside consultant. And until the city knows for sure that the developer can actually handle this project, the entire redevelopment process for Bayview–Hunters Point needs to be put on hold. *

A heart once nourished

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› gwschulz@sfbg.com

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

Meanwhile, problems at Ella Hill grew.

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

"I don’t got any," the boy responds.

"You don’t have any," Smith corrects.

Smith suddenly realizes what time it is.

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

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

Sunshine Task Force shoe-in shot down

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Chalk this one up in the “take nothing for granted” category.

The Board of Supervisors at today’s meeting gave an empty seat on the Sunshine Task Force to James Knoebber, rather than David Waggoner — the candidate recommended by Rules Committee. The switch came from Sup. Sean Elsbernd, who happens to be sitting on the opposite side of the courtroom as Waggoner in a case currently before the Ethics Commission.

Yet, there was no discussion about the amendment from Elsbernd to vote in Knoebber over Waggoner. The supes voted 9-1 in favor of Knoebber, ignoring the recommendation from the Rules Committee.

As one witness told us, “Nobody said anything except Elsbernd. They just voted. It smacked of an insider deal. The proper thing to do would be to send it back to Rules.”

On May 15, the Rules Committee (comprised of Ammiano, Dufty, and Daly) recommended Waggoner to the seat — an attorney with experience using the Sunshine Ordinance and who other task force members had looked forward to working with.

Waggoner expressed some shock at the news. “I don’t really know the back story yet. I don’t know why the supervisors changed their votes,” he told us. “At the Rule Committee, the conversation was about former chair Doug Comstock [the incumbent for the seat] and myself. They barely discussed the other candidate.”

“Supervisor Daly in particular mentioned I was very well qualified,” he recalled.

Daly is apparently the only one that stuck to his guns and was the lone dissent on the vote (though Maxwell was out of the room.)

A call of Ammiano on why he changed his vote has not been returned.

But here’s the back story:

A vote for public power in November

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EDITORIAL Working with environmentalist cover, Mayor Gavin Newsom and Pacific Gas and Electric Co. have moved aggressively to derail a move that would have given the city control over some local power generation. Instead, the mayor is now pushing to keep Mirant Corp. running the one electricity plant that still operates within city limits.

The politics of the deal are complicated, but the driving force is clear: PG&E didn’t want the city moving even a small step toward public power, and as usual, the big utility is getting its way.

The power plant deal proves exactly why Supervisors Ross Mirkarimi and Aaron Peskin should move forward with a November charter amendment for public power.

As Amanda Witherell reports, the San Francisco Public Utilities Commission has been trying for years now to win approval for three city-owned combustion turbines that would generate electric power at a plant at the foot of Potrero Hill. The idea: the turbines, also known as "peakers," would generate enough power during peak-use periods to convince the state to shut down the dirtier Mirant Plant.

Many environmentalists opposed the proposal, saying that the city shouldn’t be building any new fossil-fuel plants. That’s a legitimate argument. But California’s Independent System Operator (Cal-ISO), the agency that controls the electric grid, insisted that renewable energy alone wouldn’t provide enough reliable power for San Francisco, and said the only way to shut down Mirant was to put in the peakers.

PG&E has been trying for months to derail the peakers — not, of course, out of any concern for the environment, but because the city would own the power plants. At first Newsom stuck by his PUC — but after seven PG&E lobbyists came into his office and gave him the facts of life (see "PG&E offers Newsom a blank check" at sfbg.com), he backed down. And now, after meeting with the CEOs of PG&E and Mirant, Newsom is pushing the worst possible alternative: he wants to retrofit the Mirant plant and let the private company operate its own peakers.

Same fossil fuel plants in the Bayview. Same type of air pollution. And the facility would be owned by a private company.

The supervisors need to reject this proposal with extreme prejudice — and the environmentalists who fought the city peakers ought to be just as loud in their opposition to Mirant’s retrofit.

The good news is that this ridiculous Newsom–PG&E deal ought to put the focus at City Hall back on public power, because that’s the only way to create a really green power profile in San Francisco.

Matthew Wald, who has coved energy policy for decades, wrote an interesting piece in the New York Times June 8 discussing why no private company wants to invest money in technology that would reduce carbon emissions from power plants. "Cutting carbon dioxide emissions is a fine idea, and a lot of companies would be proud to do it," Wald wrote. "But they would prefer to be second, if not third or fourth."

That’s because no private utility wants to take the risks and try something new that another company could then copy. In economic terms, carbon reduction is a public good — it’s something that benefits everyone, and nobody has the exclusive right to make money off of it. Private companies have been notoriously bad at investing in public goods.

But that’s not how public power agencies work. A San Francisco power agency would have every motivation to develop and use technology that saves consumers money or protects the environment. There’s no issue of profits to protect; in fact, one of the mandates of a city agency should be reducing carbon emissions and promoting renewable energy.

We have always been sympathetic to the concerns that the city-owned peakers would emit greenhouse gases. But if the city owned the plants, the city could shut them down anytime, whenever enough renewables were available. Mirant won’t shut down anything that is bringing in cash.

Mirkarimi and Peskin are working on the details of a public power measure, but the outlines ought to be clear: it should mandate that the SFPUC create and implement a plan to put the city in the retail power business, in compliance with the letter and spirit of the Raker Act — and get rid of PG&E and Mirant. The supervisors should put that on the November ballot.

Politics and sausage

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hungarian-sausage.jpg
Last night, I was reminded of the old joke that people who like sausage and appreciate politics shouldn’t watch either one being made.
Less than a week after winning a majority of the seats on the San Francisco Democratic County Central Committee, the progressive-minded “Hope Slate” candidates (all of which were endorsed by the Guardian) descended into bitter infighting over who to back for the powerful chair of the DCCC.
The acrimony began when Board of Supervisors president Aaron Peskin, whose 23,049 DCCC votes was second only to David Campos (whose run for supervisor this fall would conflict with running the DCCC), resisted calls to run for the chair, much to the consternation of progressive stalwarts such as Chris Daly and Robert Haaland.
Some Hope Slate candidates, such as Laura Spanjian, were apparently supporting a play by Assembly member turned Senator-to-be Mark Leno to have moderate Scott Wiener continue as the DCCC chair, despite the fact that he wasn’t part of the winning slate and he finished in 10th place in the DCCC District 13 race.
And for awhile there, Peskin seemed to be going along the Leno’s play, arguing that progressives should adopt a conciliatory posture. So the candidates gathered together last night at the 500 Club to hash out their differences, and I had a front row seat for a discussion that turned nasty – with Daly shouting at Peskin and Spanjian and then storming out of the room.
But today, as cooler heads prevailed, Peskin has decided to run, telling me, “Yes, it is true, I am running.”

$2.8 million for Newsom’s Community Justice Center? Hell, no.

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“There are so many things on the chopping block that this seems out of whack.”

So said Sup. Tom Ammiano at yesterday’s Board hearing on the Mayor’s Community Justice Center, sounding diplomatic compared to some of the pointier comments that his fellow supervisors made, as the Board voted 7-3 to send Newsom’s $2.8 million CJC back to committee.

But then again, all the supervisors sounded outspoken compared to Sup. Geraldo Sandoval, who recused himselffrom the discussion , on the grounds that he is running for judge. (Sandoval’s absence felt even more ironic as the hearing progressed and a couple of sitting judges spoke in favor of the center.)

Now, everyone knows that wannabe governor Mayor Gavin Newsom has been itching to add the CJC t to his political resume ever since visiting a similar one in New York.

The public power initiative: let’s roll

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By Bruce B. Brugmann

Coming home after almost two weeks in Sweden with the annual World Association of Newspapers (WAN) assembly and study tour, I was struck once again how nothing seems to change in San Francisco when it comes to the PG&E/Raker Act scandal.

PG&E was still firmly in control of the city’s energy policy in the mayor’s office. Mayor Gavin “The Green Knight” Newsom had capitulated spectacularly to PG&E and had reversed his policy of supporting a plan by his PUC that would have given the city control over some local power generation at the Mirant power plant (the peaker proposal.) The mayor had met secretly with PG&E executives and stiffed representatives from the Potrero Hill neighborhood and the environmental, environmental justice, public power, and community choice aggregation (CCA) movements.

The Hearst-owned Chronicle continued its long corporate tradition of blacking out the real story of the accelerating PG&E/Raker Act scandal. The utility was beautifully executing its divide and conquer strategy it has honed ever since the days that John Muir and the Sierra Club fought in vain to stop the damming of Hetch Hetchy Valley in Yosemite National Park for the city’s public water and power supply. (In that battle at that time, the Guardian would have stood with Muir.)

Amanda Witherell laid out the latest sorry episode in her story in Wednesday’s Guardian. Her lead: “Green City Mayor Gavin Newsom finally outlined what he calls a ‘more promising way forward than the current proposal’ of building two publicly owned power plants in San Francisco. The way forward: retrofit three existing diesel turbines at the Mirant Potrero Power Plant, while simultaneously shutting down Mirant’s most polluting smokestack, Unit 2.”

Our editorial laid out the political context: “The politics of the deal are complicated, but the driving force is clear: PG&E didn’t want the city moving even a small step toward public power, and as usual, the big utility is getting its way…PG&E has been trying for months to derail the peakers–not, of course, out of any concern for the environment, but because the city would own the power plants. At first Newsom stuck by his SPUC but when seven PG&E lobbyists came into his office and gave him the facts of life (see ‘PG&E offers Newsom a blank check‘), he backed down.

“And now, after meeting with the CEOs of PG&E and Mirant, Newsom is pushing the worst possible alternative: he wants to retrofit the Mirant plant and let the private company operate its own peakers. Same fossil fuel plants in the Bayview. Same type of air pollution. And the facility would be owned by a private company.”

Repeating for emphasis: When PG&E spits, City Hall swims. When PG&E spits, the mayor swims.

And so PG&E and Newsom have set the stage for the next phase in this great battle to kick PG&E out of City Hall, enforce the federal Raker Act mandating public power for San Francisco, and bring our own cheap, clean Hetch Hetchy public power to the residents and businesses of San Francisco.

The next stage is the emerging new public power initiative that Supervisors Ross Mirkarimi and Aaron Peskin are working on, with a wide swath of neighborhood and public power forces, aimed for the November ballot as a charter amendment.

This would be the third go at taking on PG&E head-on on the November ballot. This time it has a good chance of succeeding since PG&E and Newsom have gone out of their way to make the case for public power in 96 point Tempo Bold for all to see and savor. The measure will also be helped by massive turnout with Obama, seven supervisorial races, a clutch of solid progressive measures, and a smart, aggressive Obama like grassroots organizing campaign.

Let’s roll. B3, who wonders when he will no longer see the fumes from the Mirant plant from his office window at 135 Mississippi Street at the bottom of Potrero Hill

Click here to read this week’s article, Newsom’s power play.

Click here for this week’s editorial, A vote for public power in November.

Newsom’s power play

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› amanda@sfbg.com

GREEN CITY Mayor Gavin Newsom finally outlined what he calls a "more promising way forward than the current proposal" of building two publicly owned power plants in San Francisco.

The way forward: retrofit three existing diesel turbines at the Mirant-Potrero Power Plant, while simultaneously shutting down Mirant’s most polluting smokestack, Unit 3.

Newsom wrote a letter to the Board of Supervisors just before a June 3 hearing on the power plants, describing a May 23 meeting that he convened with SFPUC General Manager Ed Harrington, City Attorney Dennis Herrera, California Independent System Operator President Yakout Mansour, California Public Utilities Commission Chair Mike Peevey, Mirant CEO Ed Muller, and Pacific Gas & Electric Co. CEO Bill Morrow.

"In the meeting, we vetted the possibility of retrofitting the diesel turbines [currently owned and operated by Mirant] and asked each stakeholder to give us the necessary commitments to advance this alternative," Newsom wrote. The board then voted to shelve the power plant plan until July 15 so the retrofit option can be vetted.

Most significant, Newsom’s meeting with top dogs at energy companies, who stand to lose a lot from San Francisco owning its own power source — and the resulting correspondence elicited a new response from Cal-ISO, the state’s power grid operator, about exactly how much electricity generation San Francisco needs.

For the first time, Cal-ISO said it will allow Mirant’s Unit 3 to close as early as 2010, when the 400-MW Transbay Cable comes online, saying that the city no longer needs to install a combustion turbine peaker plant at the airport.

Sup. Sophie Maxwell expressed frustration that the questions she, her staff, and other stakeholders have been asking for the past several years are suddenly getting different answers. "I think we’re seeing a big movement by Cal-ISO. This is huge. Before, we asked all these questions, [but] they weren’t saying what they’re saying now," she told the Guardian after the hearing.

When asked why she thought this was happening now, she simply pointed to PG&E. "Who stands to benefit from us not generating our own power? Who sent out all that stuff?" she asked, referring to the flyers depicting filthy power plants that PG&E has been mailing to residents in an effort to drum up public sentiment against the city’s plan to build peakers. "Have they been concerned about what’s clean, about our people?"

Some environmental activists are hailing the change as a triumph. "David has just moved Goliath, but we need to keep pushing," said Josh Arce of Brightline Defense, which sued to stop the city’s plan to build the two power plants. He said his organization’s goal is ultimately to have no fossil fuel plants in the city. But when asked about the retrofit alternative, he said, "We don’t support it; we don’t not support it."

Cal-ISO has insisted that San Francisco needs 150 MW of electricity to stave off blackouts. This grid reliability is currently provided by Mirant-Potrero, but the plant’s Unit 3 is the greatest stationary source of pollution in the city. Bayview residents, who have borne a disproportionate share of the city’s industrial pollution, have been agitating for more than seven years to close the plant. Much of the leadership has come from Maxwell, who represents the district and has championed the plan to replace the older Mirant units with four new ones owned and operated by the city.

That vision was integrated into San Francisco’s 2004 Energy Action Plan, which Cal-ISO has used as a guiding document for the city’s energy future. The plan outlines a way to close Mirant by installing four CTs and 200 MW of replacement power. "Cal-ISO has consistently said in writing, in verbal instructions, and at meetings, that the CTs are the only specific project that was sufficient to remove the RMR [reliability must-run contract] from Mirant," said SFPUC spokesperson Tony Winnicker.

As San Francisco’s energy plans have evolved over recent years, SFPUC staff have been instructed at numerous public hearings in front of the Board of Supervisors to ask Cal-ISO if all four CTs are still necessary. Letters obtained by the Guardian show Cal-ISO has never said the airport CT isn’t necessary until now. When asked why, Cal-ISO spokesperson Stephanie McCorkle said, "The questions are not the same. That’s why the answers are different."

When pushed for more details on what’s different, she said, "We feel the introduction of the Mirant retrofit fundamentally changes our approach to the fourth peaker. I think it’s the megawatts. It’s basically the retrofit that changes the picture."

Mirant’s peakers currently put out 156 MW, an amount that may be reduced by retrofitting. The city’s three peakers would produce 150 MW. Winnicker couldn’t explain why the story is changing, telling us, "We’re really deferring to the leadership of the mayor and the board because they’ve been able to get a really different view from Cal-ISO than we’ve been able to get."

"We’ve always said we’re open to alternatives," McCorkle said. "We can only evaluate what’s presented to us and the Mirant retrofit was only presented in mid-May." Opponents of the peaker plan say the new position indicates SFPUC officials haven’t been pushing Cal-ISO hard enough or asking the right questions.

"The city hasn’t done its due diligence insisting on different configurations of the peakers," Sup. Ross Mirkarimi told us. "What we’re learning now we could have learned two years ago." He went on to add, "With the abundant paper trail, one can only surmise or conclude there may have been a presupposed bias on the part of the PUC to the answers expected from Cal-ISO."

The SFPUC has been instructed by the mayor’s office to determine if Mirant retrofit diesels would be as clean as the city’s CTs. Until that can be proved, some are withholding support.

"I haven’t seen any information that a Mirant retrofit is as clean as the peakers," City Attorney Dennis Herrera told the Guardian. "From my perspective, I want the most environmentally clean solution."

To that end, some would like to see a formal presentation to Cal-ISO of a "transmission-only" alternative, which would outline a number of line upgrades and efficiencies that would obviate the need for any in-city power plants. Sup. Maxwell introduced a resolution urging the SFPUC to put such a proposal before Cal-ISO and to enact strict criteria for any alternative to the city’s CTs.

"We need to remember that Mirant was a bad actor. Mirant is not to be trusted," Maxwell said. "We sued them and we won our suit," she added, citing litigation brought by the city against the private company for operating the power plants in excess of its permitted hours and for market manipulation during the 2001-02 energy crisis.

Maxwell’s legislation, cosigned by six other supervisors, lays those concerns out and cautions, "In view of this history, the city should be cautious and vigilant in taking any steps that expand the operation of Mirant’s facilities in San Francisco."

The legislation also reminds policymakers that San Francisco’s Electricity Resource Plan identifies eight specific goals — one of which is to "increase local control over energy resources." It goes on to say, "City ownership of electric generating supplies can reduce the risk of market power abuses and enable the city to mandate the use of cleaner fuels when feasible or to close down any such generation when it is no longer needed."

Maxwell’s resolution also outlines a series of conditions that any alternative to the city’s peakers would have to meet. The alternative would have to be as clean or cleaner than the city peakers, have the same comprehensive community benefits package that was attached to the city’s peaker plan, have no impact on the bay’s water, and only be run for reliability needs.

The City Attorney’s Office said these criteria are not set in stone — it’s a resolution and therefore requires some level of enforcement or action. Mirkarimi, who signed on to the resolution, is still uncomfortable with it as it stands, saying it should include discussion of the city’s new community choice aggregation (CCA) plan for creating renewable public power projects.

Some environmentalists cautioned that the transmission-only approach still leaves too much control in the hands of others. "We shouldn’t let PG&E be the ones to solve this problem," said Eric Brooks, a Green Party rep and founder of Community Choice Energy Alliance. He’s urging city officials to put all the city’s energy intentions — from the CCA plan for 51 percent renewables by 2017 to an exploration of city-funded transmission upgrades — into a presentation for Cal-ISO.

Brooks noted a conspicuous absence from the May 23 meeting with the mayor: "CCA and environmentalists weren’t at the table, as usual."