Our story last week on the Uber driver who plowed into a fire hydrant got a lot of attention, but apparently it’s not so rare for errant drivers to create sudden urban showers. Reader JJ Harris sent us this shot from a crash early this morning at 1450 Valencia, where a woman who appeared to be intoxicated plowed through the parklet in front of EHS Pilates and into this fire hydrant. Thanks for sharing, JJ.
Steven T. Jones
Final Burning Man ticket sale brings total to 61,000 sold for $23 mil
With the final official Burning Man ticket sale going off without a hitch yesterday, Bay Area burners are now in mad preparation mode, with DPW setup crews arriving on the playa this week, early art crews heading out next week, and everyone else anxiously awaiting the official start of the annual Nevada desert bacchanal in 27 days.
With the US Bureau of Land Management recently awarded the event a permit and population cap of 68,000 — a big jump from last year’s 60,000 cap — Black Rock City LLC decided to bump up yesterday’s “OMG! Sale” ticket offering from the initially planned 1,000 up to 4,000.
“The sales yesterday went breathtakingly smoothly,” event spokesperson Jim Graham tells the Guardian.
Yesterday’s ticket sales brings the total number of tickets sold up to 61,000. Accounting for the expensive early sale tickets (3,000 at $650 each), low-income tickets (4,000 at $190), and 54,000 at this year’s standard $380 price, that brings the LLC’s gross revenue from ticket sales (not counting fees) to $23.23 million. The LLC also gives away thousands of tickets each year to volunteers, art crews, and VIPs.
No wonder this ambitious organization could afford to hire Graham as yet another official spokeperson, joining Megan Miller (US Sen. Barbara Boxer’s former flak) and longtime spokesperson Marian Goodell, an LLC board member.
After last year’s stressful scramble for tickets, availability seems to be pretty good this year. Craigslist has lots of tickets still available for face value, and while Stubhub is still listing 223 tickets starting at $550 each (burners consider it bad form to charge more than face value), anecdotal evidence suggests that’s just wishful thinking by scalpers still hoping for a big score.
My advice: don’t pay more than face value, and if you’re willing to wait until the very last minute, you’ll probably get one for even cheaper than that.
Or as Graham told us, “Everybody who wants to get to the event will certainly get a ticket.”
Richmond gets radical, seizing foreclosed homes from banks
As a rule of thumb, we at the Guardian tend to believe that if the banking and real estate industries are against something, then we’re probably in support of it. But that’s not the only reason that I’m so intrigued about the possibilities of Richmond taking ownership of hundreds of foreclosed homes, using eminent domain laws as needed, to keep people from being evicted and rejuvenate the community.
Richmond officials want to take over 624 homes that are underwater in that foreclosure-plagued city, becoming the first city in the country to do so. San Bernardino had considered and rejected the idea earlier, largely because of opposition from banks and threats that they might stop lending in the city. But Richmond officials appear to be holding tough against such extortionary threats and moving forward.
KQED’s Forum did an interesting segment on the situation this morning, following up a report from Democracy Now! on Tuesday (KALW also did something on this last month), with the bankers and Realtors offering up all kinds of unfounded concerns and fear mongering to confuse the issue. Because this is a truly radical action that Richmond is considering, in the best sense of that term: banks and those who control property have too much power over our lives, and it’s about time a city takes some of that power back on behalf of its people.
This is like nationalizing the assets of corrupt capitalists who have gone too far in subverting the broad public interest, a populist shot over the bow of the people who consider themselves our economic masters, from Wall Street right down San Francisco’s Chamber of Commerce and Association of Realtors.
As Richmond Mayor Gayle McLaughlin told Democracy Now: “The banks sold our community predatory loans, and now they have no solution that they’re presenting for this crisis. So we are stepping in to fix the situation. We’re stepping in by taking these troubled loans off the hands of the banks. And we’re paying them fair market value for these loans, and then we’re working with the homeowners to refinance and modify loans in line with current home values. So we call on the banks to voluntarily sell us these loans. And if they don’t cooperate, we will be considering eminent domain.”
Just think about the possibilities of this: cities could seize all their most distressed properties, then pay fair market value (which would be at fire sale prices for rundown homes in communities with high foreclosure rates), have the residents work with city officials to turn the area around and thus substantially increase the value of those homes, and eventually sell those homes at a profit, either to their current occupants or some other city residents (choosing buyers based on social considerations, not strictly financial ones). If it works on a small-scale, it could be ramped up to larger and larger scales, with cities selling bonds to buy real assets that would only go up in value as properties get more attention than these absentee bankers have been giving them.
If predatory entrepreneurs can buy these short-sale properties and flip them for a profit, why can cities do the same thing and do some good for their people in the process?
Community-based journalists also raising Airbnb’s issues in SF
Mainstream media outlets in San Francisco may be slow to pick up on how Airbnb and other online home rental companies are violating local laws and dodging local taxes — the subject of our cover story this week — but both international and community-based journalists are paying attention to this growing problem.
The excellent bilingual newspaper El Tecolote covered some of the same ground we did in its cover story this week, “Unregulated Rental Business Takes Over Housing,” focused on how Airbnb is contributing to gentrification and displacement in the Mission District.
Reporter Jackson Ly found a couple that turned a rent-controlled apartment on 24th St. into a $249 per month de facto hotel room, booking it for 24 nights in August and making $5,976 in just one month, on top of the $3,069 they’re making in August renting out the guest room in the apartment where they actually live for $99 per night.
“It’s cheating the people that pay taxes,” Maria, who lives in the unit below this couple’s investment apartment and is tired of the rotating stream of tourists in her building, told the newspaper.
I got ahold of El Tecolote Managing Editor Iñaki Fdez. de Retana, who told me, “it seems like we’re on the same page,” noting the Guardian has also recently written about the prison hunger strike and some other issues that his paper has covered.
He said that housing issues like this one are extremely important to the Latino community that lives in the Mission, and he’s been surprised that Mayor Ed Lee has been unwilling to address the impacts of Airbnb and other tech community contributors to the problem.
“It is very important,” he told us, noting that visiting European tourists are changing the character of the neighborhood. “In particular on 24th Street, which was once seen as the heart of the Mission, it’s changing overnight and [Airbnb and other housing rental websites] is a big part of that.
Meanwhile, we’re still waiting for a substantive response from Airbnb to the issues that we and a handful of other journalists are raising. CEO Brian Chesky, who was an amateur competitive bodybuilder before founding Airbnb in 2008, would apparently rather flex his muscles than deal directly with the community where his company is based.
California’s refusal to reduce its prison population is a sign of deeper problems
California just doesn’t get it when it comes to criminal justice. We have among the highest incarceration rates in the world (just below Russia’s, and about four times the European average); our prisons eat up far too much of our state budget; they are shamefully overcrowded, secretive, and inhumane; yet politicians from Gov. Jerry Brown on down refuse to show the courage or leadership to try a different approach.
When the conservative-dominated US Supreme Court — which on Friday upheld the lower court requirement that California reduce its prison population by 10,000 by the end of the year — is more progressive and enlightened than California’s leaders, you know there’s something seriously wrong here.
Rather than finally doing the right thing and complying with court orders to reduce a population that is still more than 43 percent over design capacity — despite reducing the population by 46,000 since 2006 because of court orders related to woefully inadequate health care in prisons — Corrections Secretary Jeffrey Beard yesterday responded to last week’s news by saying he will send more inmates to prisons in other states, at a high cost to California taxpayers.
What’s wrong with these people?!?! California prisons already lock up 124,363 people as of July 31, with another 8,959 inmates locked up in Arizona, Mississippi, and Oklahoma prisons at our expense. Tens of thousands more have been sent back to county jails under the state’s Realignment policies (which San Francisco, to the credit of its progressive approach to criminal justice, has managed to absorb and still reduce our jail population, thanks to smart alternatives to incarceration). And yet state officials still can’t get our prisons back to anywhere close to their design capacity?!?!
Of course, doing so would require rethinking decades of mindless “tough-on-crime” legislation that swelled our prison population. They’d probably also need to address the gutting of reentry and rehabilitation programs in the state, as well as conditions in some prisons that drive inmates mad (the subject of an onoing prison hunger strike). And they might even need to reform an economic system that is squeezing those on the bottom — sowing widespread economic insecurity that drives even law-abiding citizens to contemplate desperate measures — just to maintain the wasteful churn of modern capitalism and the obscenely inequitable concentration of wealth at the top.
Hmm, I do believe that I’m starting to understand the motivations of our elected officials after all, those guardians of status quo power and privilege from both major parties. But if we’re ever going to move toward justice and sustainability, California’s prison system is probably a good place to start.
Into thin air
By Steven T. Jones and Parker Yesko
Airbnb is an audacious corporation, particularly in San Francisco, the city where it’s headquartered and where its business model works best. This city is tech-savvy and popular with tourists, but hotels here are expensive, while rent-controlled apartments are still affordable, creating a strong incentive to rent those rooms at a profit through Airbnb.
The problem is that its business model is basically illegal. Its users violate five different sections of laws in San Francisco, from planning codes to tax laws to rent control. Disrupting complex regulatory systems developed over decades, Airbnb has managed to unite traditional adversaries against it: both the Hotel Council of San Francisco and the hotel workers of UNITE-HERE Local 2, both the landlords from the San Francisco Apartment Association and the renters from the San Francisco Tenants Union.
But Airbnb and its young founders just don’t seem to give a fuck about any of that. Sure, most of its hosts in San Francisco are violating their leases and land use laws, and a string of them have gotten evicted as a result. But Airbnb is rolling in cash, with Forbes now valuing the company in the billions, with a B, thanks to the double-digit percentage it takes from every transaction, low overheard costs, and venture capitalists who can’t seem to throw enough money at the company.
When the San Francisco Tax Collector’s Office last year held hearings on whether Airbnb and similar companies must collect the city’s transient occupancy tax (TOT), the surcharge of up to 16 percent that hotels charge to guests, the company rallied dozens of its local hosts to oppose the taxation and even enlisted the support of Mayor Ed Lee, who shares a financial benefactor with Airbnb: venture capitalist Ron Conway.
It wasn’t enough to overcome the clarity of city tax laws and the equity arguments made by the hotels, and the city ruled that Airbnb and/or its hosts are responsible for collecting the TOT. So what did the company do? Nothing. It just kept making money and stiffing the city, and when the Guardian wrote about how it appears to be shirking that annual tax bill of nearly $2 million (see “Airbnb isn’t sharing,” 3/19/13), the company and its consultants simply refused to answer our calls or questions — then and now, for months.
As this story was going to press, the company did finally send us a prepared statement that was more self-promotional than responsive to our questions, but it included the line, “Airbnb is committed to working with the City on policies that make San Francisco stronger, promote innovation, and ensure the sharing economy continues to grow.”
Really, you almost have to admire these guys’ chutzpah. Except for the fact that Airbnb and similar companies — VRBO, Roomorama, HomeAway, countless new upstarts, as well the DIY option of Craigslist — are exacerbating the city’s housing crisis by taking thousands of apartments off the rental market, driving up rents, and causing evictions in the process.
Board of Supervisors President David Chiu stepped in to mediate this mess early this year, trying to create legislation that would legalize and regulate the activities of Airbnb and other so-called “shareable housing” companies. But hopes of introducing something in the spring turned into a goal of midsummer, then by the August recess, and now sometime this fall, hopefully.
In the meantime, the money keeps rolling into Airbnb, complaints against it mount (here and in other big cities), its tax bill goes unpaid, and the landlords and tenants, the hoteliers and the workers, are all left to wonder why the city can’t or won’t enforce its own laws.
CHIU’S CHALLENGE
Chiu may have met his match with Airbnb. He has forged compromises on some of the toughest legislative challenges that City Hall has wrestled with this year — including condo conversions, CEQA reform, and the CPMC hospital deal — each time finding the acceptable middle ground between the progressive and moderate supervisors and constituencies.
His approach to this one sounds similarly centrist, with Chiu supporting the concept of shareable housing but understanding the myriad problems that Airbnb is presenting in complex cities. He neither sounds Lee’s unqualified boosterism of Airbnb nor does he fret about its impact on the housing market as much as its critics.
“I do not think shareable housing is either the cause or the solution to the housing crisis,” Chiu told us.
He’s striving for something between New York City’s total ban on tenants renting out their apartments while they’re away and the laissez faire approach of other big tourist cities. He sees some merit in Chicago’s requirement that Airbnb hosts register with the city to regulate it, but that’s not quite what he wants to do either.
“It’s a much less materialistic way to live and that’s a good thing,” Chiu said of the basic shareable economy concept of making more efficient use of existing resources, whether it be housing, cars, or consumer goods.
But he’s equally clear in identifying the problems and overhyped claims, acknowledging that “it takes away housing from permanent residents, driving up the cost of housing.”
While he says it’s good to spread visiting tourists and their money around the city — a regular claim of Airbnb and its advocates — that also creates problems when apartments become virtual hotel rooms, disturbing neighbors and upsetting the dynamics of landlord-tenant relations.
“Shareable housing is used and abused in ways that displace permanent San Francisco residents,” Chiu said. “Those are the excesses that need to be reined in, in a serious way.”
So he’s trying to create legislation that will set fair and clear standards, ensure compliance with city laws, improve the city’s enforcement of those laws, and generate “tax revenues to cover the city’s expenses in hosting hundreds of thousands, if not millions, of visitors every year.”
But Airbnb has only complicated Chiu’s goals and his reputation as the legislator who solves tough problems, largely because knowledgeable sources tell us the company has been unwilling to really compromise — perhaps emboldened by support from the Mayor’s Office and the city’s apparent impotence to enforce its own rulings — and is dragging out the negotiations.
Chiu wouldn’t comment on that, but he did acknowledge that these negotiations have been difficult. How can you allow renters to make a little extra money while recognizing the rights and concerns of their landlords and neighbors? How can you protect rent control and still allow tenants to profit from their units? Can you prevent landlords from using Airbnb or VRBO to bypass rent control? If you create a registry to ensure only permanent residents are playing host, what’s to stop landlords from using that list to evict those on it?
“We want to carve out a reasonable opportunity for people to do this,” Chiu said. “This is tough partly because of these complexities, and the laws are on the books for a reason….The more we pull these strings, the more this unravels.”
LANDLORDS AND TENANTS TOGETHER
San Francisco Tenants Union Executive Director Ted Gullicksen has been involved with the Chiu-Airbnb negotiations — from which he hopes to strengthen enforcement of rent control and apartment conversion laws while still allowing limited use of shareable housing sites by tenants — and he told us, “It turned out to be a very slow process.”
“Airbnb has just been balking and wanting more and more,” Gullicksen told us. “This process has been frustrating, but Chiu has hung in there.”
Gullicksen said the goal has been to limit short-term hosting to fewer than 90 days in a 12-month period, with only permanent city residents allowed to host, but Airbnb wants people to be able to rent out their apartments for eight months. And Gullicksen said he wants to see tenant laws and the rental stock protected from conversion to vacation rentals.
“We’re most concerned about the impact on the housing stock and evictions, because there’s so many of these…We have entire buildings that have been on the tourist market for years,” Gullicksen said. “It added a huge new way to remove units from the rental market.”
Gullicksen said that conversions of apartments became an even bigger problem than conversions to condos when the financial crisis hit in 2008, and that could become an even bigger problem now that the condo conversion lottery has been suspended for 10 years under legislation approved earlier this year (“Supervisors approve condo legislation,” Politics blog, 6/11/13).
In fact, he said that there has been a rash of unusual Ellis Act evictions in recent months, with buildings that have six or more units being cleared of tenants even though they are ineligible for condo conversions, raising suspicions that they’re being used for vacation rentals.
Hotel Council Executive Director Kevin Carroll told us Airbnb and similar companies should be paying the TOT, as the city ruled, and he doesn’t understand how they’ve gotten away with it for so long.
“A visitor to San Francisco, whether they are staying with Airbnb or a hotel, they’re using city services,” he told the Guardian, dismissing the arguments that shareable housing companies should be treated differently. “They do compete with hotels.”
Janan New, executive director of the San Francisco Apartment Association, expressed frustration that city officials have let this situation drag on as long as it has.
“I don’t know why [Tax Collector Jose] Cisneros isn’t collecting the tax. I don’t understand it,” New told us. “They certainly have the money.”
Cisneros told us that his office has the power to audit companies, “and we can bring taxpayers into courts of law,” but because of taxpayer privacy laws, he can’t discuss what’s happening with Airbnb.
“I cannot confirm or deny or discuss what is or isn’t being done,” Cisneros said, even refusing to offer an off-the-record assurance that something is being done to back up his ruling last year and address the perception that companies are free to flout his authority with impunity.
Attorney James Parrinello, representing SFAA and Coalition for Better Housing, sent a letter to top city officials on Jan. 14 “to discuss the fast-growing practice of illegal short-term/transient rentals for profit and request the City take immediate action to address the problem.”
New said they never got a response, although she tells us, “We did have a candid dialogue with [Chiu] six months ago.”
“All of these tenants in San Francisco are using their units as pieds-a-terre for out-of-town tourists and they’re doing it in ways that jeopardize their rent control status and the safety of their neighbors,” New said.
She told stories of visitors being loud, disrespectful, even committing an assault. She said one tenant placed a lockbox on his door to facilitate a rotating series of guests, while another rented out a second apartment in his building exclusively for Airbnb guests.
And she confirmed that her association has worked with landlords to search Airbnb and other sites to identify tenants who are illegally renting out their apartments and to serve them with three-day “notice to quit” warnings, otherwise they would be evicted.
“Under rent control, some tenants are making more money than they pay in rent,” New said, noting that landlords are essentially underwriting the rentals. “It’s stealing.”
Gullicksen expressed concerns that landlords are doing that kind of research to try to evict tenants, but he said the Tenants Union is doing similar research to ferret out landlords who are using these services to illegally turn apartments where evictions have taken place into vacation rentals and de facto hotels, focused mostly on VRBO because “they have a greater landlord emphasis.”
“The homes that we’re talking about are owned by the person that’s renting them out. It’s not people that are basically subletting their homes,” VRBO spokesperson Victor Wang told us, refusing to comment on local apartment conversion laws or other issues specific to San Francisco.
Chiu told us he takes the rent control issues seriously: “Our rent control laws are in place for very important reasons and we need to make sure it stays affordable.”
DISAPPEARING APARTMENTS
In a city experiencing what politicians and activists of all stripes have called a “housing crisis,” it might come as a surprise that US Census numbers indicate 8.3 percent of San Francisco’s rental stock was vacant in 2010 — about 31,000 units — up from 4.9 percent a decade earlier.
Scott James, homeowner and small-time landlord advocate, would have us believe that rent control is to blame, arguing in a recent New York Times op-ed (“King of My Castle? Yeah, Right,” 6/11/13) that “San Francisco’s anti-landlord housing laws and political climate make [renting] untenable.”
Faced with a bad tenant at his home in the Castro, James said he “joined the ranks of thousands of other small-time landlords here who will never rent again, adding to the city’s housing shortage.”
Yet the San Francisco Rent Ordinance confers broad authority to evict tenants for a plethora of “just causes,” including late payments, breach of lease (such as, ahem, illegal subletting), nuisance or damage to property, and owner move-in. Since the law dates back to 1979, it probably doesn’t explain the steep rise in vacancies. And with evictions now hitting an 11-year high, it’s hard to paint landlords as helpless victims.
San Francisco Rent Board Executive Director Delene Wolf told us the eviction rate has actually mimicked bullishness in the real estate market rather than beefier tenant regulations. She said it “really spiked around the dot-com years, for obvious reasons went way down during the recession, and it’s back up now because the market heated up.”
Some embittered landlords may indeed live atop empty units for decades but, given a median rental price of $2,764 per month for a one-bedroom unit, there’s an enormous opportunity cost to being disgruntled.
But perhaps that’s what “shareable housing” is really about: getting around the rules to make some money. Short-term rentals have become so lucrative that it’s financially possible, and easier than ever, for a homeowner to exit the long-term rental market for good.
Airbnb is so unregulated that even a homeowner who has used the Ellis Act to supposedly get out of the rental business could easily and anonymously monetize an officially vacant space for higher profit margins and with less oversight as a “vacation” rental.
Annette Fajardo has made clients out of people like James. She started her business, SF Holiday Rentals, just after the first dot-com boom, when she began managing short-term rentals in the homes of her friends. When she had nine properties in her roster, the business became a full-time job.
Over the last decade, demand for her management services has increased so much that she says she’s now “very picky about who she works with.”
Fajardo currently manages more than 40 furnished units that guests can book on her own website, as well as Airbnb, Roomorama, VRBO, HomeAway, Trip Advisor, and Craigslist. Her clients are all owners offering full homes or apartments and all the units she manages have been permanently withdrawn from the long-term rental market.
Quite often, her guests stay for a month or longer. Some are international tourists, but the majority are new corporate transplants to San Francisco. The demand for units like hers keeps growing: She gets 100 inquiries on her properties each day, about half from Airbnb.
“There’s always been corporate furnished rentals,” Fajardo told us in the dining room of a Castro flat that she lists for $350 per night on Airbnb. “That market has always been there. It’s just that there’s so much more business now. We got Google, Apple — you’ve got the busses running here all the time. I get Google people all the time and they spend big bucks.”
And she’s been through it all — battles with the tax collector in three municipalities, catastrophic fires in two properties, fraudulent guests, drunk guests, pornographers, and, worst of all, meddlesome neighbors.
“Your neighbors are a problem,” Fajardo emphasized. “In the Castro, you have to do a 30 night minimum cause the neighbors fink on you.” And when they do, the Planning Department can step in. They “send a letter stating the residential code and to cease and desist. If you don’t stop less than 30 night rentals, then they can fine you.”
COMPLEX LAWS, SIMPLE SITE
City tax and zoning laws ban apartment rentals of less than 30 days, labeling it “illegal hotelling.” Dwellings in residential areas repurposed as tourist housing have, in the eyes of the Planning Department, essentially been commercialized without proper permitting or payment of the TOT.
Rentals for more than 30 days aren’t regulated as commercial properties, but the tenants in those homes have rights under the 1979 rent ordinance, which protects any tenant who, according to Rent Board spokesperson Robert Collins, “pays rent and inhabits a unit for two days. You don’t have to sign a lease to be a tenant — you just have to pay rent and occupy the unit.”
This presents a number of challenges to both tenant- and owner-hosts. Tenants who gouge tourists on nightly rates are often in violation of a rent ordinance ban on “charging upon additional occupancy more than the rent that the tenant pays to the owner,” explained Collins.
Tenants who rent out their apartment for a few days can even lose their rights to reclaim their homes. Collins cited multiple cases where subletters refused to leave and returning tenants had little legal recourse because “they would not have a just cause to evict the subtenant because, if they’ve rented the entire unit, they aren’t themselves a resident in the unit.”
Owners who offer their units on Airbnb assume the same risk of unwanted, long-term guests. But they hedge against it by charging exorbitant nightly, weekly, and even monthly rates. On the off chance that a guest does demand a lasting lease, Fajardo reasons, “if I’m getting $5,500 a month for a two-bedroom, you can stay for the next 10 years.”
Fajardo knows where laws limit her opportunity for gain and to remain within their bounds. But most hosts, the ones Airbnb advertises as offering “unused space to pay your bills or fund your next vacation,” aren’t running a sophisticated business. And Airbnb offers them little help or support.
Airbnb just lists the rentals then mediates the payments. And the company collects revenue at both ends of transactions, charging guests a 6-12 percent service fee upon booking then taking another 3 percent before remitting payment to hosts.
Anyone can create a guest or host profile and Airbnb conducts no user verification, although both can leave online reviews. “We do not attempt to confirm, and do not confirm, any Member’s purported identity,” Airbnb states in its terms of service. “You are responsible for determining the identity and suitability of others.”
The company advertises a $1 million “Host Guarantee” backed by Lloyd’s of London, but warns that it “should not be considered as a replacement or stand-in for homeowners or renters insurance. The Host Guarantee does not cover: cash and securities, collectibles, rare artwork, jewelry, pets, personal liability.”
The site also does not vet the content of property listings for legality. Hosts can set their rates and even add on a cleaning fee or refundable security deposit, but it offers no functionality for hosts to itemize and collect the TOT, now more than a year after San Francisco required that it be collected.
Tax issues are only vaguely addressed in an FAQ section for hosts, noting that “some hosts are required by their locality to charge a tax.” Hosts ambitious enough to attempt compliance must essentially become amateur tax specialists. Few, however, have the experience to decipher the code correctly and even fewer are likely to seek it out in the first place.
A search for the word “tax” across the site’s roughly 4,750 San Francisco listings yielded a mere 174 hits and myriad approaches to the issue. Several hosts mentioned collecting the TOT in cash on arrival or required credit card information in advance — a clear incursion into the secure nature of the transaction. A host named Jesse with 85 listings told the Guardian that he just rolls the TOT up into his daily rates, despite the city’s requirement that it be listed separately.
Fajardo isn’t alone in creating a full-time business of short-term apartment rentals. Casa Buena Vista Rental lists 76 properties on its website, many of which overlap with Jesse’s 85 Airbnb listings. A host named Bernat has 48 listings that also appear on Come2SF.com. Gaylord Suites, a Tenderloin apartment complex, markets at least seven different apartments in the same building on the site.
Fajardo said she’s pushed Airbnb for a dedicated TOT field “until [she’s] been blue in the face,” but she feels strongly that the company should not be held responsible for the collection of tax itself. “It’s not their burden,” Fajardo argues in defense of Airbnb. “They’re a booking agent. They funnel the money and they expect you to do the taxes.”
OTHERS CAN DO IT
The New York- and Singapore-based Roomorama was founded in 2009 and has a nearly identical payment model to Airbnb’s. But it has a formal host verification process and a higher price point that CEO Jia En Teo told us helps to filter out bad guests.
“Our host verification is very tight,” explained Teo. “When a host is listed on our site, they don’t go live immediately. They go through a quality control and validation process. We have a team that will call the host and ask for utility bills and ID. We do due diligence.”
Teo said a TOT field has been included in Roomorama’s price template from the beginning since the vast majority of the site’s listings are “professionally managed properties, people that are actually licensed to run short-term rentals. They’d already been paying and collecting these taxes….One of the first things that was requested was a way to collect.”
Teo also said that if Roomorama, as an operator, was deemed responsible for collection and remittance of taxes, it wouldn’t be “difficult from a logistical standpoint. It would add more work to our load but, to be honest, most of it is automated anyway. Once we put in the mandatory tax field, it would simply be paid the same way a consumer pays when they eat at a restaurant.”
She’s unsure why Airbnb has been so reluctant to address the tax issue head on, but “if I could venture a guess,” she said. “I’m guessing it’s because they work more with the occasional host, and that makes their value proposition a little bit less appealing.”
Other industry competitors include Craigslist and VRBO, both founded in 1996, and VRBO’s parent company, HomeAway. All three share a similar business model and one that’s considerably different from Airbnb’s — they are not financial gatekeepers in the transaction between guest and host. At their essence, these sites are little more than digital classified ads.
No competitor comes close to the market share that Airbnb has captured in San Francisco and globally. In New York, Roomorama has 2,688 listings compared with Airbnb’s 25,724, despite its questionable legality there. In San Francisco, Roomorama hosts 303 properties and VRBO features 1,123 — and Airbnb has about 4,750 throughout the city.
Airbnb’s statement to us touted that financial impact: “We are proud of the $56 million that Airbnb’s users generated for the San Francisco economy last year. The vast majority of Airbnb hosts share the home where they live, and more than half directly use their Airbnb income to pay their rent or mortgage.”
THE CITY’S SHARE
When the San Francisco Tax Collector’s Office discussed the matter last year and issued “Tax Collector Regulation 2012-1: Tax on Transient Occupancy — Multiple Party Transactions; Occupancy of Private Residences,” it made clear Airbnb should be collecting the tax as it processes the transactions.
“A website company, or any other person acting as merchant of record who receives rent in connection with an occupancy transaction, is an ‘operator’ who is responsible for collecting the TOT owed by the occupant and for remitting the TOT to the City. Any person receiving such rent shall provide a receipt to the occupant. Such receipt shall include a separate line item specifically identifying the TOT,” reads the regulation.
While it’s also true that the city tax codes make Airbnb and its hosts jointly liable for the tax debt — which the company’s apologists have used to accuse the Guardian of unfairly picking on the company in an avalanche of online comments —it would be a regulatory nightmare for the city to go after thousands of individual hosts, most of them small-time tenants who don’t even have business licenses.
Fajardo is diligent about compliance, but she can afford to be. She works with a team that includes assistants and an accountant and she does it full-time. She is not the casual homeowner supplementing her income (and it’s unlikely many of her clients are either) — she is an entrepreneur. And even she admits to having found the TOT difficult to interpret.
Fajardo contacted the Guardian in June in response to our coverage of Airbnb, citing the city’s complicated tax system and the difficulty that small users have in paying the TOT, which has varying fees tacked onto the base rate of 14 percent. (Although she also wrote, “We collect and pay sometimes as much as $10,000-20,000 per quarter.”)
“Don’t blame Airbnb, blame the SF Tax Collector for a shoddy website, incompetent workers, and their inability or lack of desire to chase individual lessors. It is not the responsibility of Airbnb to collect taxes; it is the responsibility of the lessor to collect the taxes, just like a hotel,” Fajardo wrote.
It’s certainly true that TOT rates aren’t simple — the 14 percent base rate gets another 1.5-2 percent tacked on it, depending on where the host is located, to fund the Tourism Improvement District proposed by hotels and approved by the city. (That fee just went up again July 1 to fund an expansion of the Moscone Convention Center.) The TOT also isn’t simple for Airbnb hosts to collect and pay.
We forwarded Fajardo’s criticisms and concerns to Greg Kato, the policy and legislative director for the Tax Collector’s Office. He acknowledged that the system is complicated — particularly for Airbnb hosts who aren’t legally allowed to operate as a hotel — but he said they try to simplify it as much as possible.
To pay taxes, a business first needs to register with the city by paying a $26 fee and filling out an application, which includes a line indicating whether transient occupancy is part of the business. “There are few, if any, barriers to initially register as a business,” Kato said.
The problems come when that business applies to the city for its “certificate of authority” to collect the taxes, and applicants are asked whether they have the relevant licenses and proper zoning to conduct that kind of business. And most Airbnb hosts don’t have that because they are actually violating a variety of city codes.
“In a residentially zoned area, this type of use is at least a conditional use [which requires a permit obtained after giving neighbors notice and going through a public hearing] if not a banned use,” Kato told us. “Those land use issues are what Sup. Chiu is trying to address with his legislation.”
Although Kato said such legislation is beyond the scope of his office, those issues can interfere with a host’s ability to receive a certificate of authority to collect the taxes.
“There are a lot of other parties interested in this issue that might have other issues that would break that authority,” Kato said, citing landlords, homeowners associations, and neighbors as parties that might object to someone essentially turning his or her apartment into a hotel room, which was banned decades ago by the Apartment Conversion Ordinance.
It’s pretty easy to see on the Airbnb website that it isn’t charging the TOT or making it easy for its hosts to do so (see “Airbnb isn’t sharing,” 3/19/13). Using Airbnb’s own stated figure that its San Francisco hosts collect about $12.7 million in rents each year, that would amount to nearly $2 million annually that the city should be collecting on these transactions.
When Airbnb’s 31-year-old founder and CEO Brian Chesky spoke at a hospitality conference organized by USF in April, he didn’t acknowledge any complexities or downsides to his business model, instead casting his company as saving the world.
“It’s like the United Nations at every kitchen table. It’s very powerful,” Chesky said of the social benefits of his company. “I think we’re in the midst of a revolution.” He wasn’t talking about revolution in the sense of challenging the authority or legitimacy of San Francisco, its laws, or its elected leaders, although that seems to be implicitly what he’s doing. And he certainly didn’t seem to be taking into account his evicted hosts, their upset neighbors and landlords, or the city’s disappearing apartments and rising rents when he said, “For us to win, no one has to lose.”
Guardian forum sparks lively discussion
We had a packed house last night for our community forum on the future of the Bay Guardian and the progressive movement in the Bay Area, with lots of great input, advice, gratitude, and just a bit of acrimony. It was even more informative and inspiring than we had hoped for and we appreciate everyone coming out and speaking so frankly.
As Sup. David Campos (who just announced his candidacy for the California Assembly) said last night, “The Bay Guardian has been the conscience of the [progressive] movement and I think it’s important for the Guardian to continue to play that role,” and that’s a role that the new generation of Guardian leaders will continue playing while also reaching out to a new generation of Guardian readers.
We’ll have a full rundown in next week’s paper, along with an extended letters to the editor section to make up for shutting down online comments this week, so for now let me just offer a brief overview. In addition to Campos, the crowd of around 100 people included Sup. John Avalos, Sheriff Ross Mirkarimi, and City College of San Francisco Trustees Rafael Mandelman and Chris Jackson.
The crowd also included Todd Vogt, CEO of the San Francisco Print Media Company, who got an earfull from progressive activists Gabriel Haaland, Chris Cook, and others over the abrupt departure of longtime Guardian Editor Tim Redmond in June, with concerns expressed over the Guardian’s credibility and editorial autonomy.
Both Vogt and those on the Guardian’s panel — which included (from right in the photo above) Publisher Marke Bieschke, Editor Steven T. Jones, Music Editor Emily Savage, Senior A&E Editor Cheryl Eddy, Art Director Brooke Robertson, and News Editor Rebecca Bowe — emphasized that the Guardian has full editorial autonomy and control over what we cover and how, and who we endorse. The mission of the paper — “To print the news and raise hell,” and to be an indispensible guide to Bay Area arts and culture — hasn’t changed.
We’re all still digesting everything what was said last night (both at the forum in the LGBT Center and an informal session afterwards at Zeitgeist that went late), and we will be factoring it into what we do and continuing this ongoing conversation with all of you. We also welcome everyone’s input and advice, which you can send to us at news@sfbg.com.
A special thanks to Alix Rosenthal for moderating the public input — and to everyone who came — for somehow keeping the comments and questions clear, concise, and constructive.
Onward!
UPDATE: Journalist Josh Wolf has written an excellent summary of the forum here at on the Journalism That Matters website. Check it out.
8/6 UPDATE: We just turned comments back on after shutting them off for a week-long experiment.
A troll-free zone? Well, almost
As promised, we’ve disabled reader comments this week, at least on all the stories in this week’s paper, fresh blog posts, and those stories and posts that were still actively being commented on. It’s a week-long experiment and encouragement for those who don’t require anonymity to send give your feedback directly at our forum tonight (6-8pm at the LGBT Center, 1800 Market) or by email (news@sfbg.com) or snail mail. We’ll publish a lot of that feedback in next week’s paper.
It’s not our intention to be doctrinaire about this or play cat-and-mouse with trolls who want to comment on older posts and feel like they’re getting away with something. Knock yourselves out and we’ll come shut down comments on those posts when we get around to it or if things run amuck.
One avenue for comments that we aren’t shutting down this week is our Facebook page, where it’s tougher to troll anonymously, and we encourage you to go and comment there if you have something to say. Or you can tweet at us. And if the demand seems to be there to allow for a discussion on our site of the issues raised in tonight’s forum, we may even consider opening up a channel for that.
The Bay Guardian has been a work in progress since 1966, and that’s never been more true than the current moment we find ourselves in as we seek to revive and rejuvenate the paper and the Bay Area’s larger progressive movement. So thanks for your support and we hope to see you tonight.
Chiu: centrist compromiser, effective legislator, or both
At the start of this year, when I wrote a Guardian cover story profile of Sup. Scott Wiener (which SF Weekly and San Francisco Magazine followed shortly thereafter with their own long Wiener profiles), he seemed like the one to watch on the Board of Supervisors, even though I noted at the time that Board President David Chiu was actually the more prolific legislator.
Now, it’s starting to seem like maybe we all focused on the wrong guy, because it is Chiu and his bustling office of top aides that have done most of the heavy legislative lifting this year, finding compromise solutions to some of the most vexing issues facing the city (ironically, even cleaning up some of Wiener’s messes).
The latest example is Wiener’s CEQA reform legislation, which the board unanimously approved on July 23, a kumbaya moment that belies the opposition and acrimony that accompanied its introduction.
That effort comes on the heels of Chiu’s office solving another big, ugly, seemingly intractable fight: the condominium lottery bypass legislation sponsored by Wiener and Sup. Mark Farrell. To solve that one in the face of real estate industry intransigence, Chiu showed a willingness to play hardball, winning over swing vote Sup. Norman Yee to get six votes using some hostile amendments.
In the end, Chiu won enough support to override a possible veto by the waffling Mayor Ed Lee, who has always echoed Chiu’s rhetoric on seeking compromise and consensus and “getting things done,” but who lacks the political skills and willingness to really engage with all sides. For example, it was Chiu — along with Sups. Farrell and David Campos — who spent months forging a true compromise on the hospital projects proposed by California Pacific Medical Center, replacing the truly awful CPMC proposal that Lee readily accepted.
“It’s been a very long year,” Chiu told the Guardian. “It’s been important for me to not just to seek common ground, but legislative solutions that reflect our shared San Francisco values.”
Next, Chiu will wade into another thorny legislative thicket by introducing legislation that will regulate the operations of Airbnb, the online housing rental corporation with a problematic business model.
After posting the preceding analysis of Chiu on the SFBG.com Politics blog on July 23, we heard lots of back channel concerns and complaints from progressive San Franciscans (and even some from moderates and conservatives who consider Chiu a raving socialist for helping suspend the condo lottery).
Nobody really wanted to speak on the record against Chiu, which is understandable given the powerful and pivotal position that he’s carved out for himself as a swing vote between the two ideological poles and on the Land Use Committee, whose makeup he personally created to enhance that role.
The main issue seems to be that Chiu allows both progressive and anti-progressive legislation to be watered down until it is palatable to both sides, empowering the moderates over the progressives. That’s a legitimate point. It’s certainly true that Chiu’s worldview is generally more centrist than that of the Guardian and its progressive community, and we’ve leveled that criticism at Chiu many times over the years.
The fact that he ends up in a deciding role on controversial legislation is clearly a role that Chiu has carved out from himself, no doubt about it. And that’s certainly why he played the pivotal role that he has this year. But when he uses that role to empower and support tenant groups, as he did on the condo lottery bypass measure, I think that’s something worth noting and praising.
On the CEQA reform legislation, it’s also a valid criticism of Chiu to note that Sup. Jane Kim had five votes for her legislation and that it was only Chiu who stood in the way of its passage (whether Mayor Ed Lee would have vetoed it, necessitating the need for two more votes, is another question).
In the end, Chiu can be seen as an effective legislator, a centrist compromiser, or both. Perspective is everything in politics.
Yahoo and other tech companies are squeezing the Chronicle’s newsroom
With high demand for office space in San Francisco these days — thanks largely to the latest technology bubble, Mayor Ed Lee’s economic development focus, and its amplification by the San Francisco Chronicle — Hearst Corp., which owns both the paper and the Chronicle Building, seems to be more focused on property management than journalism these days.
Following up on blogs that broke the story, Chronicle Technology Columnist James Temple today reported that Yahoo is negotiating with Hearst to move its headquarters into the Chronicle Building at 5th and Mission streets. What Temple didn’t say — and what sources at the Chronicle confirmed to the Guardian, despite the fact that it hasn’t yet been announced to Chronicle staff — is that the third floor newsroom will soon be relocated while the space undergoes a renovation.
It’s not clear whether the two pieces of news are related, and we’re still waiting for a response to our questions on the subject from Chronicle Editor Ward Bushee. But it certainly seems true that Hearst and the Chronicle are doing everything they can to profit from the commercial real estate market that they have helped to heat up while operating a newspaper that has struggled to become profitable in recent years.
Valued at more than $30 million and covering nearly a full city block in the heart of the city, the Chronicle Building has been steadily taken over by outside companies in recent years, many of them technology corporations such as Square, the online payment company. The newsroom that used to occupy the second and third floors has already been squeezed onto the third, and now even that space is getting an overhaul.
Meanwhile, Hearst has been working with Forest City and Strada Investment Group on a plan to redevelop the property, reportedly replacing the old Hearst headquarters and other buildings that share the block with an office and residential tower and trying to win historic landmark status for the Chronicle Building itself.
Chronicle staffers tell the Guardian that they were surprised to hear about the newsroom relocation last week and they don’t have many details, except that they will remain in the building. And given how valuable it has become, they say they’re just happy to not be totally squeezed out by the tech boom.
Is the Guardian empowering Chiu or just recognizing his power?
I’ve been hearing lots of back channel complaints and concerns from progressive San Franciscans since last week’s blog post on Board of Supervisors President David Chiu and the role he’s played forging compromises on controversial pieces of legislation this year.
Some have even suggested that the Guardian has gone centrist under my freshly minted editorship, which I actually find kinda funny given my history, perspective, and the righteously anti-corporate and progressive perspective stories that I’ve written and edited in recent weeks. I can honestly tell you that I call ‘em like I see ‘em, now as always, even if that doesn’t always hew to the progressive orthodoxy of some.
Nobody really wants to speak on the record against Chiu, which is understandable given the powerful and pivotal position that he’s carved out for himself as a swing vote between the two ideological poles and on the Land Use Committee, whose makeup he personally created to enhance that role.
So for now, let me just air some of the criticisms and offer some responses and perspective. The main issue seems to be that Chiu allows both progressive and anti-progressive legislation to be watered down until it is palatable to both sides, empowering the moderates over the progressives.
That’s a legitimate point, it’s certainly true that Chiu’s worldview is generally more centrist than that of the Guardian and its progressive community, and we’ve leveled that criticism at Chiu many times over the years. The fact that he ends up in a deciding role on controversial legislation is clearly a role that Chiu has carved out from himself, no doubt about it. And that’s certainly why he played the pivotal role that he has this year.
But when he uses that role to empower and support tenant groups, as he did on the condo lottery bypass measure, I think that’s something worth noting and praising, particularly in my quick little blog post that seems to have grown in perceived significance beyond what I may have intended.
Many of the criticisms involved the CEQA reform legislation that was unanimously approved by the board last week after progressives opposed its initial iteration by Sup. Scott Wiener.
As some have suggested, Sup. Jane Kim does deserve tremendous credit for resisting the initial legislation and working with activists on an alternative, and I included that recognition in my initial story on the legislation. And it’s valid criticism of Chiu to note that Kim had five votes for her legislation and that it was only Chiu who stood in the way of its passage (whether Mayor Ed Lee would have vetoed it, necessitating the need for two more votes, is another question).
But I quoted Eric Brooks, an activist who spent months working on the compromise, as saying the CEQA legislation ultimately does make it easier to oppose bad projects. And when it was approved unanimously by the board, I figured it was safe to place that piece of legislation on the list of Chiu legislative accomplishments for the year.
We at the Guardian will make mistakes, as we always have from time to time. But I’m going to try to err on the side of open, transparent public debates — while supporting a rejuvenation of the city’s progressive movement, so that it is able to start playing offense and protecting this city’s diversity, vitality, and progressive values.
And if you have any criticisms or advice for the Guardian, please come to our forum on Wednesday or offer them to me directly. Thanks for reading.
Calling all trolls: you’ll have to come to our forum to comment next week
We are all very excited about our July 31 public forum on the future of the Bay Guardian and progressive journalism in the Bay Area. We’ve already received lots of great community support and input since our recent turmoil and leadership transition — and we want even more feedback as we work to rejuvenate the paper.
But there is one piece of advice that we’ve received over and over again from readers: do something about the trolls that pollute our comments section. So we’ve decided to turn that input into a little week-long experiment starting on the day of the forum. As we post next week’s Guardian here at sfbg.com, we will disable the comments on the stories and in our blog posts that week.
We always welcome reader input and we appreciate thoughtful commentary, criticism, and debate on our stories, which we’ve seen plenty of this week, particularly in our posts on the Giants labor impasse, Board President David Chiu, privatization of the Botanical Gardens, problems at SFDPH, racial profiling, and our editorial on democracy, as well as on last week’s op-eds on the Trayvon Martin aftermath.
Unfortunately, under the Guardian’s bridge live a few nasty trolls who hate everything that we and our progressive community do and are usually the quickest to comment on the things we write, often making the same pointed, off-topic criticisms, over and over again. Sometimes it’s racist, usually it’s reactionary, often it’s self-indulgent, and it always lowers the level of debate on our site.
Many of our regular readers and supporters have repeatedly told us the often toxic nature of these discussions chases them away and needlessly undermines the reporting and information that precedes it. Sometimes, we’ve seen organized misinformation campaigns from anonymous but clearly self-interested parties that post to our site, as we’ve seen in our coverage of Airbnb’s legal troubles and tax avoidance.
So in addition to all of our proud, loyal, flesh-and-blood readers, we’re hereby inviting all of our trolls — Matlock, Lucretia Snapples, Anon, and all the rest — to come to our forum and defend your domain. Among the many orders of business at the forum, we will consider changing our online comment policies and registration system, particularly as we redesign our website this fall.
If you want to comment next week, you’re going to have to come to our forum. Or you can always send us good, old-fashioned letters to the editor, either through email (steve@sfbg.com or marke@sfbg.com) or snail mail. Then, in our Aug. 7 issue, we’ll devote a page or two in the paper to those letters and the input that we receive at the forum.
We’ll probably just leave our comments turned off for one week — but you never know. So for now, let us know what you think as we rethink our approach at the Guardian. And please stop by our event page on Facebook and let us know that you’re coming to the event on July 31 from 6-8pm on the fourth floor of the LGBT Center, 1800 Market Street … if you dare.
Burning Man event will benefit its new nonprofit, whose future role is still murky
There’s a pricey event in San Francisco this evening “exploring the past, present, and future of Burning Man,” with all proceeds going to The Burning Man Project, the nonprofit vessel that Black Rock City LLC created to supposedly take over operations of this venerable cultural phenomenon. With the murky, ever-evolving plan for what that allegedly imminent transition looks like and what the new governance structure will be, the forum could shed some light on the subject — but I wouldn’t bet on it.
For my latest cover story on Burning Man and its leadership, which ran last month, I sat down with founder Larry Harvey and LLC board member Marian Goodell to discuss the transition at length. Even after listening to the recording of that interview several times, I still had a hard time discerning what the plan is, mostly because I don’t think they even really know at this point.
Even though Harvey told me “we’re pretty much on schedule” to turn operations of the late summer event over to the new nonprofit board next year, it doesn’t seem that the hand-picked nonprofit board will have any real authority. And the relationship of the nonprofit to the LLC — which will continue to control all things Burning Man, despite Harvey indicating otherwise when he announced the plan two year ago — is still being defined.
“I would answer that a little more completely by saying what we’re really in the middle of doing is looking at the structure for Black Rock City LLC, which is an event production company and its infrastructure and doing the outreach to the world,” Goodell told me, adding the six current board members will still guide the event and culture and that “we’re more necessary than ever.”
Some veteran burners consider that to be a fairly bold statement coming from a business that derives its value mostly from the volunteer efforts of the 60,000 people who create Black Rock City every year, and whose “10 principles” (prominently posted on the front page of the Survival Guide circulated to all attendees this year) include Participation, Radical Inclusion, Communal Effort, Civic Responsibility, and Decommodification.
In the wake of my last story, I heard from sources within the LLC who appreciated me raising these issues and trying to keep the organization honest and true to its principles, but they’re all afraid to speak out publicly, mostly of Goodell’s wrath. They said that while four of the six LLC board members do seem willing to give up some control over the event and culture, Harvey and Goodell have gone the opposite direction and seem to be expanding their control as they travel the world as burner ambassadors.
In their interview with me, both Harvey and Goodell made clear their indispensible roles in protecting the event from “meddling” by the nonprofit board and with sheperding the larger burner culture.
“Oh no. We are giving up managing the event in favor of managing the culture in the greater world, that’s what we’re doing. And we can hardly do it fast enough because we don’t have time to manage the event,” Harvey said, later noting the LLC could become essentially a consulting firm that Burning Man regional organizations around the world pay for services. “That’s how things work in the real world.”
Tonight’s event is entitled “This is Burning Man,” named after the seminal burner book penned by the host of the event, Brian Doherty, who will lead the discussion with Harvey and co-founder Michael Mikel, aka Danger Ranger. The 7pm event is at Z Space Theater, 450 Florida, with tickets ranging from $20-$125.
I’ve always appreciated Doherty and his book, which I drew from for my own book on the culture’s modern era, The Tribes of Burning Man, and he contacted me after my last article to say he was glad to see me raising these issues. And he did tell me that one of the topics he plans to cover tonight is “the original corporate structure and why that might be changing.”
Yet Doherty, a libertarian who is a senior editor at Reason Magazine, doesn’t really share the view that the burner community has sweat equity in the event and therefore a right to help guide a culture that has evolved significantly since the LLC was formed in 1997.
“I no longer approach the event with a close-focus journalists eye, but do still consider it a fascinating unfolding story not just of a bunch of interesting people trying to ride a tiger they’ve let loose — and this applies to organizers and attendees — but about the most fun thing one can do with your time. I also maintain, I know controversially, that in most respects any attendee should care about, the event has been in most important respects the same since it got its current shape in 1998,” he told me. “Yes if you are dealing with the bureaucracy or burning big art or trying to get it funded or working for BMorg, a lot has changed. If you are one of the blessed 90 percent who are buying tickets and enjoying or paricipating in a way that does not have to intersect any of that, well, you still have the same Burning Man us boring old folk had, and please enjoy it. I would say preserve it; you can certainly try to evolve it, but it seems resistant to change in some respects.”
That may be true, but that isn’t what Harvey told the burner community two years ago, when he promised to “gift the event back to the community,” a meme that was uncritically repeated and amplifed in the documentary “Spark: A Burning Man Story,” that is now making the theatrical rounds.
“Arguments welcome, thanks for caring, the story of how this thing was built is still one of the great American culture stories of our time, with characters as fun and deep and resonate of great pantheonic virtues as you’ll find,” Doherty says. “This does not mean I worship them as Gods — merely respect them as representing virtues, vices, and concerns and ideas as old as human civilization.”
It may not always seem like it, but I also respect Harvey, Goodell, and the rest of the Burning Man leadership, even if I think a little more clarity and open public discussion is necessary now, so let me close with some more of their comments from our interview.
“We want to make sure the event production company has sufficient autonomy, they can function with creating freedom and do what it does best, which is producing the Burning Man event, without being unduly interferred with by the nonprofit organization,” Harvey said.
“That’s why you heard it one way initially, and you’re hearing it slightly differently now, and it could go back again,” Goodell said. “We don’t think it’s sensible, either philosophically or fiscally, to essentially strip away all these entities and take all these employees and plop them in the middle of The Burning Man Project.”
“So there’s directly administered by this huge collossus at the center,” Harvey added.
“That looks like the US government,” Goodell interjected. “We think it would look like a many tentacled beast. That’s what we’re all afraid of in the world, a government putting their paws into us too much.”
Yet it wouldn’t be a government, but a bunch of nonprofit board members and experienced burners who would represent Burning Man’s constituent communities. Harvey said something like that might eventually work, but for now, that’s not what’s happening.
“We might change our minds at any time, that’s our perogative, but right now we’re absolutely on the path that you heard at the talk at the Bently Reserve two years ago,” Goodell said.
“We are in fact relinquishing our control,” Harvey said. “We are delegating the authority that the partners held as executives to the staff that operates it.”
New director triggers a brain drain at SFDPH
The San Francisco Department of Public Health has seen an exodus of top officials over the 18 months since Barbara Garcia took the reins from longtime chief Mitch Katz, the most recent being Environmental Health Director Dr. Rajiv Bhatia, who was placed on administrative leave last month pending an investigation into unspecified concerns.
Bhatia has been a hero to many progressive San Franciscans and public health professionals for his innovative work supporting expanded worker protections, regulation of cannabis dispensaries and restaurants, environmental justice initiatives, and other work that has landed him in the pages of the Guardian many, many times.
“The poorest Americans are about two times as likely to die. People in low-wage jobs have less access to health care … food, shelter, clothing, and transit,” Bhatia testified during the 2002 Board of Supervisors hearing that led to the creation of a city minimum wage.
Neither Bhatia nor the department would comment on his leave, although sources tell us that he has not been informed of the charges against him (which an item in the Chronicle last month suggested was a possible conflict of interest issue relating to his regulation of restaurants) and that Garcia has clashed with many top officials in the department since taking over.
Among those who have left the department are Dr. Susan Fernyak, Director of Communicable Disease Prevention and Control; Dr. Masae Kawamura, Director of TB Control; Dr. Grant Colfax, Director of HIV Prevention; Elizabeth Jacobi, Director of Human Resources; Tangerine Brigham, Director of Healthy San Francisco; Mark Trotz, Director of Housing and Urban Health; and Dr. Erica Pan, Director of Emergency Preparedness.
“SFDPH has a national and worldwide reputation for innovative solutions to traditional public health problems. As a citizen of this city, I’m concerned that the current leadership is fostering an environment that is driving out and stifling that innovation to the detriment of all of us. A number of staff people have told me they have been instructed not to stretch themselves to innovate, to do only what their job description says and no more,” said the source, who works for a nonprofit that partners with the department.
Asked to comment on the exodus and her role in it, Garcia issued the following statement in response to questions from the Guardian: “Three staff that reported to me directly were recruited and provided promotions in the Los Angeles Department of Health Services. I’m very proud of these staff who are now involved with Health Care Reform efforts for the Los Angeles area. Several other staff that reported to our Public Health Division left for positions that were closer to home and the majority of these departures were promotions. All staff left in good standing with the San Francisco Department of Public Health.”
Meanwhile, 93 “members of the public health, social and environmental justice, foundation and education communities” wrote a signed letter to Mayor Ed Lee on July 10 on behalf of Dr. Bhatia, highlighting his work and appealing for a just resolution to the situation.
“Many across the nation have been grappling with how to improve the social and environmental conditions that are the cause of poor health and health inequities. Under Dr. Bhatia’s leadership, the San Francisco Department of Public Health Environmental Health Section has found practical ways — using research, policy, regulation, and cross-sector collaboration — to produce measurable improvements to environmental and social conditions throughout San Francisco’s diverse communities,” they wrote.
While writing that they “have no knowledge or commentary on the details of the leave or investigations, they went on to note the initiative that Bhatia has shown in going beyond his prescribed duties to work with various San Francisco constituencies to support equitable solutions to this city’s problems: “He takes his responsibilities as a public servant seriously, working well beyond required hours, and he is committed to improving the life-chances of socially, economically, and politically marginalized communities.”
Chiu becomes City Hall’s go-to guy for solving tough problems
At the start of this year, when I wrote a Guardian cover story profile of Sup. Scott Wiener (which SF Weekly and San Francisco Magazine followed shortly thereafter with their own long Wiener profiles), he seemed like the one to watch on the Board of Supervisors, even though I noted at the time that Board President David Chiu was actually the more prolific legislator.
Now, it’s starting to seem like maybe we all focused on the wrong guy, because it is Chiu and his bustling office of top aides that have done most of the heavy legislative lifting this year, finding compromise solutions to some of the most vexing issues facing the city (ironically, even cleaning up some of Wiener’s messes).
The latest example is Wiener’s CEQA reform legislation, which the board is poised to unanimously approve at today’s meeting, a kumbaya moment that belies the opposition and acrimony that accompanied its introduction. Rather than a battle between developers and the coalition of progressives, environmentalists, neighborhood activists, and historic preservationists, Chiu and board aide Judson True transformed the legislation into something that benefited both sides.
[UPDATE: For reactions to this post and another perspective on Chiu, read this.]
That effort comes on the heels of Chiu’s office solving another big, ugly, seemingly intractable fight: the condominium lottery bypass legislation sponsored by Wiener and Sup. Mark Farrell. To solve that one in the face of real estate industry intransigence, Chiu showed a willingness to play hardball and practice a bit of gamesmanship, winning over swing vote Sup. Norman Yee to get six votes using some hostile amendments to the legislation.
In the end, Chiu won enough support to override a possible veto by the waffling Mayor Ed Lee, who has always echoed Chiu’s rhetoric on seeking compromise and consensus and “getting things done,” but who lacks the political skills and willingness to really engage with all sides. For example, it was Chiu — along with Sups. Farrell and David Campos — who spent months forging a true compromise on the hospital projects proposed by California Pacific Medical Center, replacing the truly awful CPMC proposal that Lee readily accepted.
“It’s been a very long year,” Chiu told the Guardian. “It’s been important for me to not just to seek common ground, but legislative solutions that reflect our shared San Francisco values.”
Next, Chiu will wade into another thorny legislative thicket by introducing legislation that will regulate the operations of Airbnb, the online shared housing share corporation whose basic business model often violates local landlord-tenant laws, zoning codes, and lease conditions, in addition to openly defying rulings that it should be paying the city’s transient occupancy tax.
“This challenge has been particularly difficult,” Chiu told us, referring the many hard-to-solve issues raised by companies such as Airbnb, who Chiu and board aide Amy Chan have been working with for several months. In fact, after originally predicting the legislation would be introduced before the board takes its August recess, Chiu now tells us it may need a bit more time to hammer out the details.
We’ll be watching to see how he sorts through the many tough issues raised by Airbnb’s approach, here and in other big cities with complicated landlord-tenant relations, which I will be exploring in-depth in an upcoming Guardian cover story. But if there’s anyone at City Hall capable of solving this one, it’s probably Chiu.
Change in leadership at DPH triggers brain (and heart) drain
The San Francisco Department of Public Health has seen an exodus of top officials over the 18 months since Barbara Garcia took the reins from longtime chief Mitch Katz, the most recent being Environmental Health Director Dr. Rajiv Bhatia, who was placed on administrative leave last month pending an investigation into unspecified concerns.
Bhatia has been a hero to many progressive San Franciscans and public health professionals for his innovative work supporting expanded worker protections, regulation of cannabis dispensaries and restaurants, environmental justice initiatives, and other work that has landed him in the pages of the Guardian many, many times.
“The poorest Americans are about two times as likely to die. People in low-wage jobs have less access to health care … food, shelter, clothing, and transit,” Bhatia testified during the 2002 Board of Supervisors hearing that led to the creation of a city minimum wage.
Neither Bhatia nor the department would comment on his leave, although sources tell us that he has not been informed of the charges against him (which an item in the Chronicle last month suggested was a possible conflict of interest issue relating to his regulation of restaurants) and that Garcia has clashed with many of top officials in the department since taking over.
Among those who have left the department, said one knowledgeable source, are Dr. Susan Fernyak, Director of Communicable Disease Prevention and Control; Dr. Masae Kawamura, Director of TB Control; Dr. Grant Colfax, Director of HIV Prevention; Elizabeth Jacobi, Director of Human Resources; Tangerine Brigham, Director of Healthy San Francisco; Mark Trotz, Director of Housing and Urban Health; and Dr. Erica Pan, Director of Emergency Preparedness.
“SFDPH has a national and worldwide reputation for innovative solutions to traditional public health problems. As a citizen of this city, I’m concerned that the current leadership is fostering an environment that is driving out and stifling that innovation to the detriment of all of us. A number of staff people have told me they have been instructed not to stretch themselves to innovate, to do only what their job description says and no more,” said the source, who works for nonprofit that deals with the department.
Asked to comment on the exodus and her role in it, Garcia issued the following statement in response to questions from the Guardian: “Three staff that reported to me directly were recruited and provided promotions in the Los Angeles Department of Health Services. I’m very proud of these staff who are now involved with Health Care Reform efforts for the Los Angeles area. Several other staff that reported to our Public Health Division left for positions that were closer to home and the majority of these departures were promotions. All staff left in good standing with the San Francisco Department of Public Health.”
Meanwhile, 93 “members of the public health, social and environmental justice, foundation and education communities” wrote a signed letter to Mayor Ed Lee on July 10 on behalf of Dr. Bhatia, highlighting his work and appealing for a just resolution to the situation.
“Many across the nation have been grappling with how to improve the social and environmental conditions that are the cause of poor health and health inequities. Under Dr. Bhatia’s leadership, the San Francisco Department of Public Health Environmental Health Section has found practical ways — using research, policy, regulation, and cross-sector collaboration — to produce measurable improvements to environmental and social conditions throughout San Francisco’s diverse communities,” they wrote.
While writing that they “have no knowledge or commentary on the details of the leave or investigations, they went on to note the initiative that Bhatia has shown in going beyond his prescribed duties to work with various San Francisco constituencies to support equitable solutions to this city’s problems: “He takes his responsibilities as a public servant seriously, working well beyond required hours, and he is committed to improving the life-chances of socially, economically, and politically marginalized communities.”
Power struggles
rebecca@sfbg.com, steve@sfbg.com
Opposition from the San Francisco Labor Council scuttled the San Francisco Public Utility Commission’s plans to approve CleanPowerSF on July 9. But activists supporting the renewable energy program actually welcomed that new roadblock, saying it could trigger a more robust rollout of renewable energy projects that they’ve been seeking all along.
“It gives us leverage,” Eric Brooks, an organizer with Our City who has pushed the SFPUC to adopt a more aggressive CleanPowerSF, told us. “They’re insisting on local union jobs and California union jobs, and we’re glad they said that.”
Brooks said labor’s insistence on union job guarantees places the SFPUC under renewed pressure to implement a more aggressive buildout of local energy projects, from building retrofits to wind power generation facilities.
The SFPUC has already come under attack for the program because Shell Energy was the sole bidder to do the initial energy purchases. International Brotherhood of Electrical Workers Local 1245, which represents PG&E workers, has used the Shell contract as ammunition in a campaign against CleanPowerSF.
Shell’s involvement also helped IBEW persuade the Labor Council to oppose the project, despite its longstanding support for community choice aggregation, the model for pooling customers into renewable power programs on which CleanPowerSF is based.
“The Labor Council is for community choice aggregation, we just don’t like how the players have shaped up,” Tim Paulson, the council’s executive director, told us. “It really makes us hold our nose that Shell Oil is going to have a role … one of the worst labor law violators in the world.”
While the council’s May 13 resolution criticizes Shell, it also expresses support for renewable energy generation in the city to “help San Francisco meet its climate action goals.”
Brooks and other progressive activists share labor’s disdain for Shell. They’re trying to limit its involvement to merely purchasing the first 20 megawatts of power so CleanPowerSF can get underway with enough customers.
The SFPUC should then take over on power purchases, Brooks says, and start issuing revenue bonds against the CleanPowerSF customer base to build green power projects. New research by consultant Local Power shows CleanPowerSF could create 1,500 local jobs per year for 10 years.
Brooks also doesn’t like Shell’s involvement, but he said it was an acceptable means to the end, which was being able to roll out a CCA program that was competitive enough on price with PG&E that at least 80 percent of its targeted customer base would not choose to opt out, the level he believes they need to fund the buildout, which would bring prices down even more.
When we left a message for Local 1245 spokesperson Hunter Stern to ask whether the union would support CleanPowerSF if it guaranteed more union jobs, he referred questions to Paulson, who wouldn’t go beyond his initial statements.
“If it wasn’t for PG&E’s pressure, Local 1245 probably wouldn’t be doing this,” Brooks said of the union’s aggressive campaign against CleanPowerSF.
Representatives from the San Francisco Public Utilities Commission told the Guardian that the agency intends to pursue a buildout of green power infrastructure, although CleanPowerSF director Kim Malcolm says only a few million dollars a year will initially be invested in renewable and efficiency projects.
“That line item is one of the reasons why the advocates are pretty much unanimously supporting this program,” SFPUC spokesperson Charles Sheehan noted. “We listened to them. They wanted a lower rate, they wanted dedicated money for local buildout.”
But to overcome labor’s opposition, those activists want the SFPUC to go further. Malcolm sounded a note of skepticism on Local Power’s job estimate, saying it was based on the assumption that the agency would issue bonds totaling a billion dollars.
“We have no confidence that we could issue a billion dollars worth of bonds in the first few years of the program,” Malcolm said, instead saying the highest the agency expected to go was closer to $200 million.
Brooks wants the Local Agency Formation Commission to hold a public hearing vetting the buildout studies by Local Power, showing the SFPUC and the general public that they are viable. Brooks said that hearing will likely take place in the next two weeks, before SFPUC votes on CleanPowerSF in late July or early August.
Asked about opposition to the program from the San Francisco Labor Council, Malcolm said the SFPUC was in talks to address their concerns. “We have this week been talking to representatives of the Labor Council about those conditions, and how they might actually be implemented in ways that might be practical and promote a sustainable program,” she said.
Brooks said he’s feeling more hopeful than ever about CleanPowerSF, particularly now that the SFPUC has gotten the price down to about 11.5 cents per kilowatt hour, about the same as what PG&E would offer for its proposed green energy program and just $6 more per month than its current brown power service.
“We’ll now hit that sweet spot on prices, and that’s when we can say, ‘Now let’s go for the buildout,” Brooks said. “We know we’re not going to win this if we don’t have labor behind us.”
CEQA reform battle sparks welcome changes even before final compromise
UPDATED When Sup. Scott Wiener last year introduced legislation that would limit people’s ability to appeal development projects by reforming the California Environmental Quality Act’s local procedures, progressives and neighborhood activists rose up in strong opposition. But now, with that measure and a competing alternative up for approval by the Board of Supervisors tomorrow (Tues/16), there is a compromise in the offing that all sides may see as an improvement on the status quo, particularly given administrative changes that the Planning Department has made along the way.
“We made a series of amendments in April that addressed almost all the concerns raised by the neighborhood activists,” said Judson True, the top aide to Board President David Chiu, who has once again taken the lead role in crafting a compromise on controversial legislation.
Final details of the deal are still being worked out, but sources on both sides say there is an agreement on the broad outlines of a true compromise. It would accomplish Wiener’s main goal of limiting the current ability of project opponents to file a CEQA appeal at any time while also improving the public notification process.
“It’s still pretty fluid now, but we’re working to get to a consensus measure, we hope,” True told us.
Wiener has always emphasized that his legislation applies only to relatively small projects, those that are “categorically exempt” under CEQA from having to do detailed environmental studies. And he said the compromises now being developed appear to meet his initial goals.
“I’m cautiously optimistic that it will be approved,” Wiener told us, adding that, “If this turns out to be a kumbaya moment, that will show the legislative process works.” [UPDATE: The compromise legislation was unanimously approved by the board.]
One byproduct of that process was recent changes on the Planning Department’s website that make it much easier for activists to track the status of projects — with a new map showing projects that have been granted CEQA exemptions that would move forward unless challenged — which activists requested during the Land Use Committee hearings on this legislation.
“We heard from members of the public that our existing posting process was cumbersome. It was also time-consuming for staff. We decided to revamp the system, using technology we’ve developed in recent years. By converting the checklist into electronic format and having it searchable by location, it’ll be easier for the public to search for a particular project and more efficient for staff to process,” Planning Department spokesperson Joanna Linsangan told us.
True said the hearings on the legislation have helped to illuminate problems that could be addressed administratively: “There’s been a real push from supervisors and the Planning Department itself to improve noticing.”
Eric Brooks, who has been working with the 42 groups that coalesced to oppose Wiener’s legislation — including environmentalists, neighborhood groups, labor, and historic preservationists — said ensuring proper noticing was half the battle. He gave credit to Sup. Jane Kim for resisting the Wiener legislation and working with activists to put forward a competing measure, sowing the seeds for the Chiu compromise.
“This was a real community process and Jane Kim needs to be lauded for taking part in this,” Brooks said, although he later added, “Whatever happens with this, David Chiu owns it because he’s put himself in the middle of this.”
One key piece of the puzzle that might not be resolved tomorrow is with what has always been the biggest concern for activists, which is how the legislation limits appeals to a project’s initial approval. “We knew that it would be way too early and it cuts off our ability to negotiate with developers,” Brooks said.
For complicated legal reasons, it was difficult to build into this legislation a process for activists to challenge a project that changes after its initial approval, so Kim has introduced trailing legislation that would do so (which is set to be heard Wednesday by the Historic Preservation Commission and Thursday by the Planning Commission).
It would allow activists to appeal changes to a project that they find environmentally significant, even if city staff doesn’t (or, in planning parlance, to appeal the environmental review officer’s categorical exemption determination — to that same officer).
“If the environmental review officer has to suffer the hearing if she makes a bad call, she will make fewer bad calls,” Brooks said. “And if we don’t change the environmental review officers’ mind, we’ll be able to take it to court.”
Dailies miss the backstory on the America’s Cup ruling
Yesterday’s ruling against a last minute rule change in the America’s Cup was duly reported in today’s Chronicle and Examiner. But as with much of the reporting presented in the mainstream media these days, it was tough to discern what’s really going on here or why the ruling came down as it did.
Luckily for Guardian readers, they’ve been privy to the excellent reporting by Amanda Witherell, who understands both boats and bullshit and set up this decision with an insightful backstory report in this space a couple days ago, “Is Larry Ellison cheating?” with an assist by Guardian staff writer Rebecca Bowe, who is also quite familiar with boats and bullshit.
Here’s the key thing that both papers missed or glossed over: Ellison’s team has been training with this new rudder design on one of its two boats since April, back when it wasn’t even allowed by the rules. And when an Artemis Racing sailor tragically died in May, the home team slipped the rudder design allowance into new “safety precautions,” although it didn’t require it of the New Zealand and Luna Rossa teams, which one would think they would have if it was really about life and death.
Which it isn’t, say Witherell’s sailing sources. In fact, these longer rudder stabilizers could even be more dangerous because they extend beyond the side of the hull and could run a greater risk of seriously injuring a sailor who slips over the side. What this was really about is changing the rules at the last minute in a way that would benefit Ellison’s team, and that effort has now been struck down by a international jury that oversees the sport.
Ellison is now presiding over these races from his ridiculously large personal yacht docked at Pier 23, a vessel the size of a small cruise ship. His people have booked big name entertainers for him to enjoy, as is customary for events thrown by tech gazillionaires. And he’s created a race using boats that are more expensive and faster — and therefore more inherently dangerous — than any in America’s Cup history, which has been roundly criticized in the sailing world for promoting elitism in the sport.
So it’s good to see that Ellison’s wealth and power can’t buy every single thing he wants, with his initial waterfront real estate deal rejected by progressive San Franciscans, and now his gambit to seek a competitive advantage on the water rejected by the sailing community.
BTW, grab next week’s Guardian to catch Amanda’s latest report on the America’s Cup as competitive sailing finally gets underway in the San Francisco Bay this weekend. And one more thing: Go New Zealand!
Willie’s shady role in Tim’s San Francisco
The Guardian’s longtime but recently ousted editor Tim Redmond continues to do excellent, important work through his Tim’s San Francisco blog, including stories today on the Chronicle’s blackout of yesterday’s big City College protest and the invasive tactics of online marketers.
But it was a story that he wrote yesterday that really should get wider play in the local media: a recent court case showed how Willie Brown received a whopping $750,000 to lobby for a local developer involved in the politically uber-juiced Transbay real estate deal. Tim builds off of the San Francisco Business Times article that broke the story and his own reporting for the Guardian questioning why Brown isn’t registered as a lobbyist.
“Nobody else is looking at the story, but it’s actually pretty big news. It sheds light on the huge amounts of money that get thrown around when someone’s trying to build a commercial office tower in San Francisco. It shows how much of a player Brown is and how much influence he’s seen to have under the Lee Administration,” Tim wrote.
Indeed, particularly given the huge and ethically question platform that the Chronicle hands Brown with his Sunday column, and the role that Brown played installing Lee into Room 200, where he’s carried water for Brown’s clients, this is a story that deserves far more attention and scrutiny.
Keep it up, Tim.
Last train
steve@sfbg.com
Last week’s four-day strike by Bay Area Rapid Transit workers dominated the news and made headlines around the country, marking the latest battleground in a national war between public employee unions and the austerity agenda pushed by conservatives and neoliberals.
Of course, that wasn’t how the conflict was framed by BART, most journalists, or even the two BART unions involved, all of whom dutifully reported the details of each sides’ offers and counter-offers, the competing “safety” narratives (new security procedures demands by unions versus spending more on capital improvements than raises), and the strike’s impact on commuters and the local economy.
But once this long-simmering labor standoff seized the attention of a public heavily reliant on BART, fueling the popular anger and resentment increasingly directed at public employee unions in recent years, familiar basic storylines emerged.
At that point, the Bay Area could have been placed in Wisconsin, Ohio, Michigan, or Illinois — the most recent high-profile labor union battlegrounds, with their narratives of greedy public employees clinging to their fully funded pensions and higher than average salaries while the rest of us suffer through this stubbornly lingering hangover from the Great Recession.
Around water coolers and online message boards, there were common refrains: How dare those unions demand the raises that the rest of us are being denied! Pensions? Who has fully funded pensions anymore? Why can’t they just be more realistic?
When Bay Area residents were finally forced to find other ways of getting around, within a transportation system that is already at the breaking point during peak hours thanks to years of austerity budgets and under-investment in basic infrastructure, those seething resentments exploded into outright anger.
And those political dynamics could only get worse in a month. The BART strike could resume full strength on a non-holiday workweek if the two sides aren’t able to come to an agreement before the recently extended contract expires.
This is the Bay Area’s most visible and impactful labor standoff, and it could prove to be a pivotal one for the modern American labor movement.
BART AS BELLWETHER
Chris Daly was a clarion voice for progressive values while serving on the San Francisco Board of Supervisors from 2000-2010. Now, as political director of Service Employee International Union Local 1021, one of the BART unions, he says this standoff is about more than just the issues being discussed at the bargaining table.
“The terms and conditions of workers in the public sector is a buoy for other workers,” Daly told us, explaining how everyone’s wages and benefits tend to follow the gains and setbacks negotiated by unions. “The right understands this, which is why the right has been mercilessly attacking public sector workers.”
Ken Jacobs, chair of the UC Berkeley Labor Center, confirmed that union contracts affect the overall labor market. “When unions improve wages and benefits, it does have a ripple effect,” Jacobs said. He agreed that the outcome at BART could be a bellwether for the question, “As the economy comes back, how much will workers share in that prosperity?”
Demonizing public sector workers as greedy or lazy also serves to undercut the entire labor movement, Daly said, considering that public employees make up a far higher percentage of union members than their private sector counterparts. And during election time, it is union money and ground troops that typically contest wealthy individuals and corporations’ efforts to maintain or expand power.
“Labor is one of the main checks on unbridled corporate power, and public sector unions are the backbone of labor,” Daly told us.
So in that context, BART’s battle is about more than just the wages and benefits of train drivers and station agents, with their average base salary of $62,000, just barely above the area median income, and their demand for raises after accepting wage freezes in recent years.
Daly sees this as part of a much broader political standoff, and he said there are indications that BART management also sees it that way, starting with the $399,000 the transit agency is paying its lead negotiator Thomas Hock, a veteran of union-busting standoffs around the country.
“He has a history of bargaining toward strikes, with the goal of breaking unions,” Daly said, noting that Hock’s opening offer would have taken money from BART employees, with new pension and healthcare contributions outweighing raises. “It was a takeaway proposal when you add it up, while they have a $100 million surplus in their budget and the cost of living in the Bay Area is shooting up.”
But BART spokesperson Rick Rice told us that Hock is simply trying to get the best deal possible for this taxpayer-funded agency, and he denied there is any intention to break the union or connection to some larger anti-worker agenda.
“There is definitely a need to start funding the capital needs of the district,” Rice told us. “I don’t see that we’re pushing an austerity agenda as much as a realistic agenda.”
AUSTERITY AND EXPANSION
But Daly said the very idea that austerity measures are “realistic” excuses the banks and other powerful players whose reckless pursuit of profits caused the financial meltdown of 2008. The underlying expectation is that workers should continue to pay for that debacle, rather than bouncing back with the rebounding economy.
“They get in this austerity mindset, and we see it in every contract we’re negotiating,” Daly said, noting that capital needs and benefits have always needed funding, despite their elevation now as immediate imperatives. “You have good people with good intentions like [BART Board President] Tom Radulovich pushing this austerity mindset.”
Radulovich, a longtime progressive activist, told us he agrees with some of how Daly is framing the standoff, but not all of it. He said that BART is being squeezed into its position by unique factors.
Radulovich said that healthcare and pension costs really are rising faster then ever, creating a challenge in maintaining those benefit levels. And he said that Hock isn’t simply carrying out some larger anti-union agenda. “He’s negotiating what the district wants him to negotiate,” he said.
Radulovich said that while BART’s workers may deserve raises, most of BART’s revenues come from fares. “So it’s taking from workers to give to other workers,” Radulovich said. “It’s a little more complicated because it is a public agency and Chris is aware of that.”
Yet Radulovich acknowledged that BART has opted to pursue an aggressive expansion policy that is diverting both capital and operating expenditures into new lines — such as the East Contra Costa, Oakland Airport, and Warm Springs extensions now underway — rather than setting some of that money aside for workers.
“And for a lot of those, we were being cheered on by the [San Francisco] Labor Council, one of many ironies,” said Radulovich, who favors infill projects over new extensions. “These are some of the conversations I’ve had with labor leaders in the last few weeks, how we think strategically about these things.”
But if BART wanted to defeat the union, it may have miscalculated the level of worker discontent with austerity measures.
“What they didn’t plan on is some high-level Bay Area political pressure,” Daly said, referring to the local uproar over the strike that led Gov. Jerry Brown to send in the state’s two top mediators, who made progress and created a one month cooling off period before the strike can resume.
RETIREMENT SECURITY
One of the hardest issues to overcome in the court of public opinion may be the fully funded pensions of BART employees. “Times are changing, costs are escalating rapidly, and we’re asking for a modest contribution,” Rice said of BART’s demand that employees help fund their pensions.
Daly acknowledges the resentments about the pension issue, even though it was essentially a trap set for public employee unions back in the 1980s, when BART and other public agencies were the ones offering to pay for employee pensions in lieu of raises.
But rather than resenting public employees for having pensions, he said the public should be asking why most workers don’t have retirement security and how to fix that problem.
“At what point do we organize and demand retirement security for all workers?” Daly said, noting that SEIU is now leading that fight on behalf of all workers, not just its members. “What we ought to be talking about is how we restore the social contract.”
Jacobs confirmed that SEIU has indeed been pushing the retirement security issue at the state and federal levels. And it’s a crucial issue, he said, noting that just 45 percent of workers have pensions and that the average retirement savings is just $12,000.
“The retirement problem we have is not the pension crisis, it is the lack of pensions crisis,” Jacobs said.
That’s one reason that he said this standoff has implications that extend far beyond the Bay Area.
“The fight goes beyond these particular workers,” Jacobs said. “It’s an important set of negotiations and an important strike in terms of looking at what happens in this country as the economy improves.”
Daly agrees there’s a lot at stake, for more than just his members.
“Losing on this means we’d be hard pressed to win elsewhere, anytime,” Daly said. “It is important symbolically, and it is important to the strength and morale of the movement.”
Opponents of City College takeover to march through SF
Opponents of last week’s decision to revoke the accreditation of City College of San Francisco and place the district under state control until that death sentence becomes official in July 2014 plan to rally and march through San Francisco today [Tues/9] at 4pm.
The procession will begin at the CCSF’s downtown campus at 88 Fourth Street and end outside the U.S. Department of Education — whose policy of coercing colleges to focus on job training and university prep led to the crackdown on CCSF, as we report in tomorrow’s Guardian — at 50 Beale Street.
Among the local officials who will join the march are Assemblymember Tom Ammiano, San Francisco Central Labor Council Executive Director Tim Paulson, and Alisa Messer, president of the American Federation of Teachers Local 2121, who this morning issued statements condemning the decision by the Accrediting Commission for Community and Junior Colleges.
“This decision is nothing less than an attack on the people of San Francisco,” Ammiano said. “All of us benefit from having this great 78-year-old institution, whether we take courses or not. San Francisco voters recognized that at the polls just last fall when they passed Proposition A to support the college financially. In addition, the appointment of a state official to manage the school takes away the local voice of CCSF’s duly elected trustees.”
“The quality of education at City College is not in question,” said Messer, who is also an English teacher at the college. “For the last year this institution has turned itself upside down to address the recommendations of the Commission, with employees putting in thousands of hours of effort and making huge sacrifices. To be told at the end of this process that the effort has had no impact is simply outrageous.”
“City College is vital and has made major progress in turning around many of the shortcomings identified by the Commission,” said Paulson. “The actions of the ACCJC – an organization accountable to no one — have unnecessarily put at risk the livelihoods of the nearly 2,500 hard-working men and women at the college. What’s more, their move to deny CCSF accreditation has imperiled the future of San Francisco’s working people, who rely heavily on a CCSF education for workforce training, language learning, and a pathway to better futures for themselves and their communities.”
“The Accrediting Commission’s handiwork has not improved educational quality at CCSF,” said Messer. “We want a stronger, better college, but in many instances direction from the ACCJC has moved us in the wrong direction. The Accrediting Commission should be accountable for the impact of its actions.”
“The accrediting agency has only worked half-heartedly to support City College, and instead seems bent on tearing it down,” Ammiano said. “The decision needs to be reversed so we can all go to work building on the successes and fixing the few problems, instead of spending our time starting over from scratch because the school was destroyed by naysayers.”
Celebrating independence, embracing wage slavery
On the eve of Independence Day, too many San Franciscans seem eager to give up on the very idea of independence, instead willingly buying into the divide and conquer strategies of those who seek to control and exploit us. Just consider the big news of the day.
On Day Three of the BART strike, mainstream and social media are once again awash with angry anti-union diatribes by people who are resentful of the fact that some workers in this society still manage to earn the pensions and decent salaries that most of us wage slaves are being denied.
Pensions are the one thing that allows the working class some degree of independence during its twilight years. And the average BART salary of $72,000 annually shouldn’t be considered excessive in an expensive city that will chew up at least a third of that in housing costs.
But they are each more than most of us are getting, so it’s easy to turn many people against their fellow workers, even though the real targets of our ire should be the bosses and economic system that are denying us our independence and the means to pursue our happiness.
It’s a similar story with the breaking news of the day: City College of San Francisco losing its accreditation and being turned over to state control. While there are some reasons to criticize how this important institution has been managed over the years, it was still being managed by locally elected trustees who made the best decisions they could under bad circumstances.
They made decisions to maintain a broad-based curriculum that this community wanted and needed, and to avoid exploiting the faculty like so many other educational institutions are doing, in the process taking a gamble with lower reserves than may be needed. And the voters of San Francisco stepped up to support CCSF with a parcel tax that was helping to ease it away from the brink, acting as a proud and independent community does during troubled times.
But a commission of unelected bureaucrats on a ideological mission to transform educational institutions into something less than the broad-based community resources that CCSF has strived to be decided to make an example of San Francisco. And they did so with the full support of Mayor Ed Lee, who issued a statement today criticizing local officials for not embracing even harsher austerity measures than they did, and saying “I fully support” the state takeover.
Lee’s hand-picked panel recommending reforms of the Housing Authority is also proposing to sacrifice the independence of poor San Franciscans in favor of ever-more subsidies to real estate developers, according to a story in today’s San Francisco Chronicle.
Among the “reforms” is a proposal to divert federal money from the Section 8 program that offers rent-subsidies to the poor, as Chron reporter John Cote described like this: “A terribly run program that provides low-income residents with vouchers for private housing would be administered by the city, rather than the federally funded public housing agency. The vouchers would be prioritized for certain affordable housing projects, creating dedicated revenue to help secure loans to build them.”
So the vouchers that allow low-income people some independence — rather than living in squalid, chronically mismanaged public housing projects in San Francisco — will instead subsidize development projects. Yes, we do need to subsidize affordable housing development, which this city is underfunding, but we shouldn’t be taking the meager resources of society’s least fortunate families to do so.
I have no doubts that Lee will jump at this suggestion (although its unlikely to be so eagerly embraced by federal regulators at HUD) given his penchant for shady real estate schemes that line the pockets of the powerful, like the one that the Center for Investigative Reporting uncovered this week.
CIR reported that the San Francisco Bay Area Regional Center — a for-profit company connected to Willie Brown that is arranging immigration visas for Chinese nationals who invest in Lennar’s Hunters Point housing development — is getting key help from Lee and members of his staff.
This project was already looking like a bait-and-switch scam, as we also reported this week, with Lennar being guaranteed profits without even putting up its own money, thanks to Lee’s willingness to use the power of his office to solicit funds on behalf of the country’s biggest residential developer.
If Lennar wasn’t going to build the affordable housing we need on the front end, or put up the money itself, why didn’t the city just administer this project and give the work to local contractors? What exactly is this Florida-based corporation doing in exchange for being handed some of the most valuable real estate in the city, except for helping its powerful local friends who pulled strings on its behalf?
What’s motivating Lee these days? Well, considering that Brown and other power brokers placed him in the Mayor’s Office after a career at City Hall doing their bidding — a role he seems to be still playing today in his powerful new role — I’d say it was a lack of independence.
It’s all pretty depressing, but at least we have a holiday tomorrow to celebrate our independence. Happy Fourth of July, comrades.
Wedding bells and Pride protests
rebecca@sfbg.com ; steve@sfbg.com
The city of San Francisco was a complete whirlwind from June 26 to June 30. First came the historic Supreme Court ruling that ended the ban on same-sex marriage in California and struck down the discriminatory Defense of Marriage Act. The historic decision, handed down just before the city’s Pride festivities got underway and as a rare heat wave gripped the city, unleashed widespread celebration June 26, culminating with a rally and dance party in the streets of the Castro.
The Supreme Court ruled that the Defense of Marriage Act, which denies federal recognition of same-sex marriage, “is unconstitutional as a deprivation of the equal liberty of persons that is protected by the Fifth Amendment.” According to the majority opinion, “DOMA’s principal effect is to identify a subset of state sanctioned marriages and make them unequal.”
Hollingsworth v. Perry, the Prop 8 case, was dismissed on standing due to the fact that the State of California refused to defend it in court. That meant the previous ruling invalidating Prop 8, by Judge Vaughan Walker and upheld by the Ninth Circuit Court, was upheld.
City Hall was totally packed at 7am when the Court convened, with hordes of journalists, gay and lesbian couples, and sign-wielding activists in the crowd. Cheers erupted when the decision was announced striking down DOMA. When the Prop 8 statement came down, the room went nuts.
“It feels good to have love triumph over ignorance,” said Mayor Ed Lee, who joined Lt. Gov. Gavin Newsom in escorting a fragile Phyllis Lyon down the stairway. When Lyon married the late Del Martin, they became the first same-sex couple to get legally married in California in 2004.
“San Francisco is not a city of dreamers, but a city of doers,” Newsom said. “Here we don’t just tolerate diversity, we celebrate our diversity.” He thanked City Attorney Dennis Herrera and others who’d contributed to the fight to for marriage equality. “It’s people with a true commitment to equality that brought us here.”
When Herrera took the podium, he turned to Newsom, and said, “Now you can say, ‘Whether you like it or not!'” — a joking reference to Newsom’s same-sex marriage rallying cry, which some blamed for boosting the anti-same-sex marriage cause. “We wouldn’t be here today if it wasn’t for Gavin Newsom’s leadership,” Herrera continued. “I remember in 2004 when people were saying it was too fast, too soon, too much.” Herrera also pledged to continue the fight that began here in City Hall more than nine years ago: “We will not rest until we have marriage equality throughout this country.”
Later that afternoon, clergy from a variety of faiths including Christianity, Judaism, Islam, Buddhism and the Church of Latter Day Saints gathered on the steps of Grace Cathedral on Nob Hill for a buoyant press conference to celebrate the court’s rulings.
“For 20 years I’ve been marrying gay and lesbian couples, because in the eyes of God, that love and commitment was real, even when it wasn’t in the eyes of the state,” said Rabbi Michael Lerner of the Beyt Tikkun Synagogue. “We as religious people have to apologize to the gay community,” he added, for religious texts that gave opponents of gay marriage ammunition to advance an agenda of discrimination.
He added that the take-home message of the long fight for marriage equality is, “don’t be ‘realistic.’ Thank God the gay community vigorously fought for the right to be married — because they were not ‘realistic,’ the reality changed. Do not limit your vision to what the politicians and the media tell you is possible.”
Mitch Mayne introduced himself as “an openly gay, active Mormon,” which is significant since the Mormon Church was a major funder of Prop 8. He called it “one of the most un-Christlike things we have ever done as a religion,” but noted that the sordid affair had brought on “a mighty change in heart from inside the Mormon community, with greater tolerance than ever before,” with many Mormons going out and marching in solidary with gay and lesbian couples, he said.
Then on June 28, earlier than expected, the County Clerk started issuing same-sex marriage licenses. Kris Perry and Sandy Stier, plaintiffs in the case against Prop. 8, became the first of dozens of happy couples to be married at City Hall that evening, and the marriages continued in the days that followed.
And as if that weren’t enough excitement, it all happened before the weekend, when Pride festivities got underway. This year featured not only the official Pride parade and myriad performances, but also an “Alternative to Pride Parade,” signifying that a radical Pride-questioning movement has been reawakened in San Francisco.
“Have you had enough with the poor political choices of some community leaders that claim to represent you? Are you over the over-corporatizing of SF Pride? Or just tired of the same old events that don’t reflect who you are, and how you want to celebrate your queer pride?” organizers wrote in a statement announcing the event.
The parade itself, meanwhile, also featured some dissenters. The third annual Bradley Manning Support Network contingent swelled in ranks this year, due to the political maelstrom touched off when the Pride Board rescinded Manning’s appointment as Grand Marshal.
The Bradley Manning Support Network contingent attracted more than 2,000 supporters who marched to show solidarity with the openly gay whistleblower, comprising the largest non-corporate contingent in the Parade. Former military strategist Daniel Ellsberg, who leaked secret government documents known as the Pentagon Papers to the press in 1971, donned a pink boa and rode alongside his wife, Patricia, in a pick-up truck labeled “Bradley Manning Grand Marshal.” Patricia told the Bay Guardian, “There is something about the energy and triumph of this beautiful event … Just as the gays have made a tremendous difference with marriage, we have to do the same with wars and aggression” in U.S. foreign policy.
Pride’s legal counsel, Brooke Oliver — who resigned over the Pride Board’s handling of the Manning debacle — marched along with the Bradley Manning contingent. Bevan Dufty, former SF Supervisor and now the mayor’s point person on homelessness, stepped down as a Grand Marshal, also because of the Pride Board’s actions, but didn’t march with the contingent.
Nor were the Bradley Manning supporters the only protest contingent to take part in the parade. A group seized the opportunity to make a political statement by marching with a faux Google bus, an action meant to call attention to gentrification and evictions in San Francisco. They rented a white coach and covered it with signs printed up in a similar font to Google’s corporate logo, proclaiming: “Gentrification & Eviction Technologies (GET) OUT: Integrated Displacement and Cultural Erasure.”
Some trailed the faux Google bus with an 8-foot banner depicting a blown-up version of an Ellis Act evictions map. Others donned red droplets stamped with “evicted” to signify Google map markers, while a few toted suitcases to represent tenants who’d been sent packing. However, their ranks were thin in comparison with the parade contingents surrounding them, which included crowds of workers representing eBay, DropBox, and, of course, Google — the largest corporate contingent in the parade.
“The organizers of this anti-gentrification and displacement contingent are not ‘proud’ that folks are being kicked out of this city that was once their refuge,” organizers of the faux Google bus contingent wrote in a press statement. “The 2013 SF Homeless Count and Survey shows that 29 percent of the city’s homeless population is ‘LGB and other.’ The Castro is experiencing the highest number of evictions in the city. Meanwhile, the SF Pride Parade is becoming as gentrified as SF. This group is calling on Pride to remember its roots.”