tv BOS Govt Audits and Oversight Committee SFGTV October 3, 2020 1:00am-3:01am PDT
>> good morning, the meeting will come to order. welcome to the thursday october 1 meeting of the government audit and oversight committee. supervisor gordon mar, i'm the chair of this committee, and i'm joined by vice-chair, supervisor aaron peskin and supervisor matt haney. thank you to the clerk, john carroll, and i'd like to thank sfgov-tv for staffing this meeting. mr. clerk, do you have any an announcements? >> clerk: in order to protect the public, board members and the city employees during the covid-19 health emergency, the legislative chamber and the committee room are closed. this is taken pursuant to all local, state and federal orders and declarations and directives. the committee members are attending through video conference and will participate to the same extent as if physically present. public comment is available for each item on the agenda. san francisco cable channel 26
and sfgov-tv.org are streaming the call-in number across the screen. the opportunity to speak and to provide comments during each public comment period on today's agenda is available via phone by calling 1-(415)-655-0001. once you're connected and prompted to enter the meeting i.d. for today's meeting, that is 1467042839. then press pound twice to be connected to the meeting. when you are connected you will hear the meeting discussions but your line is going to be muted and in listening mode only. if there's an item of interest to you on today's agenda, and we're calling public comment on that item, dial star, followed by 3, to be added to the speaker line for that item. the system prompt will indicate that you have raised your hand. please wait until the system indicates that you have been unmuted and then you may begin your comments. best practices are to call from a quiet location, to speak clearly and slowly, and to turn down your television and your radio or streaming device.
everyone must account for potential time delays and speaking discrepancies that we may encounter between the live coverage and streaming. alternatively you may submit public comment by emailing me, john carroll, the clerk of the government audit and oversight committee, my email is email@example.com. and if you submit public comment via email it's included in the legislative file. and your written comments may be sent to city hall, the address is 1 doctor carleton b. goodlet place, room 244, san francisco, california, 94102. and finally, mr. chair, items acted upon today will appear on the board of supervisor's agenda of october 20, 2020, unless otherwise stated. >> chair mar: can you call agenda item 1. >> clerk: an ordinance amending
the administrative code to subject dwelling units at midtown park apartments, residential development owned by the city and county of san francisco. and expanding the rent board fee to cover those dwelling units. the members of the public who wish to provide public comment on this ordinance should call the number, and i will repeat the number again, 1-(415)-655-0001. enter the meeting i.d. for today's meeting, which is is 1467042839. press the pound symbol twice to connect to the meeting and then press the star key, followed by the number 3 to enter the queue to speak. a system prompt will indicate that you have raised your hand. wait until the system indicates that you are unmuted and you they begin your comments. one more thing, mr. chair, i have a request that this item be considered as a committee report for consideration by the board of supervisors at the next board meeting, tuesday, october 6th. >> chair mar: thank you, mr. clerk. i welcome supervisor preston who is the sponsor of this measure.
and thank you so much, supervisor preston, for your work with the midtown apartment and for sponsoring this item. the floor is yours. >> supervisor preston: thank you so much, chair mar. and, colleagues, before you today is an amended version of the legislation to provide rent stabilization to the long-time tenants at midtown apartments in my district. and this item was heard at the previous hearing of this committee during which substantive amendments were introduced and accepted. and today i respectfully request that we move the item to the full board. i do want to start by thanking the members of this committee, chair mar, vice-chair peskin, the committee member haney, for co-sponsoring this item at the september 17th hearing. and i wanted to thank and recognize supervisor ronen and supervisor walton who also have agreed in the intervening week to be co-sponsors.
it means a lot to have all of your support on this. and i know that it means a lot to the tenants of midtown and to have a majority of the board of supervisors supporting this measure. but we really hope that others will get on board and we can send a strong signal hopefully with unanimous support on this. at the previous hearing i discussed if detail the history of midtown, the context for this proposal. i explained our proposed amendments and their rationale. in the interest of time, i know that you have a busy agenda, i do not plan to cover that ground again today unless there's specific questions. i do, however, have a few minor amendments. i will be requesting today, which we are assured by the city attorney, that are all non-substantive amendments and really just intended to provide greater clarity on the implementation side of this program. the amendments will clarify the time period that most c.d. will
have to implement the program. after meeting with my office and most, we agreed that in order to make sure they have the time for the apartment to correctly and effectively to roll the program out that they have no later than february 1, 2021, for -- to implement the -- all of the details of the program. so the specific amendments are as followed, and these have been circulated to the committee on page 8, line 6, stroke the word "promptly," on page 8, line 7, ""most c.d. will determine the base rent, applicable rent increases and shall credit any excess amounts by no later than february 1, 2021." and the second amendment further clarifies the procedure in the event that a legacy tenant at midtown elects to have their rent calculated as a percentage of income and the amendment at
page 8, line 16-17, would simply strike the word "be implemented" and insert "take effect." finally, colleagues, i would like to make the request that before accepting the amendment that the committee duplicate the file. the purpose of duplicating the file is to ensure that if there are further technical adjustments that are needed during implementation process that need to be addressed legislatively, that we can address those through the duplicated file while not incurring further -- any further delays on providing the relief that midtown tenants deserve and will be getting if this ordinance passes. after duplicating the file i would ask the committee to take the amendments that i have described to the original and then move that to the full board with positive recommendation as a committee report. and then request that the duplicated file, the original,
be duplicated file to be continued to the call of the chair. i do just want to in closing to say that this has been a long road for the midtown tenants fighting since 2014 for this small measure of justice. my office has worked from the beginning of this year on crafting this proposal, working with the tenants and making the adjustments and conferring to make sure that we were providing the relief needed without interfering with any possible options for long-term homeownership investments, rehabilitation, that is the future of midtown. and, you know, we will be back, colleagues. this is essential now. we will be back before the board of supervisors i'm sure addressing the long-term plight of tenants at midtown and to
make the repairs that are needed and to stabilize the housing and to have the residents control and/or own the property in a more significant way. as was the long-standing historical promise to those tenants. but in the meantime, we've got to stabilize and address this rent increase situation, and that's what the legislation before you does today. so respectfully i request that as laid out that you move the amended item forward with positive recommendation today. thanks so much. >> chair mar: thank you, supervisor preston. i think that all of your requests -- or requested actions, sound good to me. before we go to public comment, colleagues, do you have any questions or comments? okay. why don't we go to public comment. mr. clerk, are there any callers on the line? >> clerk: thank you, mr. chair. operations is checking to see if
we have any callers in the queue. let us know if there are any callers that are ready. for those who have already connected to our meeting via phone, please press star, followed by 3, to be added to the queue to speak for this item. for those already on hold in the queue, please continue to wait until you are prompted to begin. you will hear that your line has been unmuted. for those of you watching our meeting on cable channel 26 or via a streaming link or through sfgov-tv.org, if you wish to speak on this item call in by following the instruction on your screen. that will be by dialing 1-(415)-655-0001. and then entering the meeting i.d. of 1467042839. and then by pressing the pound symbol twice, you will connect to the meeting and then you would press star, followed by 3, to enter the queue to speak. do we have any callers for the ordinance on agenda item number one? >> yes, i have nine callers in the queue. i will queue the first caller.
>> caller: hello? >> clerk: hello, please begin. >> caller: hi, my name is arthur racal and i'm talking as a resident of midtown park apartments. i wanted to say thank you so much for co-sponsoring the legislation. i believe that it's very important to us here with regards to getting the rent control or rent stabilization legislation passed. if you could please also speak to your other colleagues at the board of supervisors with regards to supporting this legislation. again, thank you so much for your time. bye. >> clerk: thank you for your comments. could we have the next caller, please. good morning, caller, are you
there? please begin. >> caller: yes, i am. my name is mary watkins and i live admit town park apartments. i have been here approximately 15 years and i have raised my children here and everything. so i was calling in to support supervisor preston, and what he's trying to do for the resolution for midtown park. so i would ask you, the supervisors, the rest of you, to support our request because we need it and everything. supervisor preston has did a wonderful job trying to help us and everything and we do appreciate that. and we will appreciate if whatever you could be able to do today to help us to control what's going on. so, you know, thanks to you, supervisor preston, and the rest of the board. please help us to look at what
is going on here at midtown park. thank you, and you have a blessed day. bye. >> clerk: thank you very much for your comments. could we have the next caller, please. >> caller: hello, my name is magic altman and a long-time activist here in the city and i wanted to thank dean preston and the other members for supporting this. i have been coming to the meetings for years and the protests. and it's been the one chance to redeem the travesty that happened when the fillmore got destroyed and midtown deserves to get the promises that were made to the residents there. they have fought so long and hard. i was at two meetings that the mayor called and neither of them did she come to. and it was really pathetic. and so it's really time -- really time -- to make amends and to not stop until they have ownership, which was promised to them in the beginning. so, again, dean preston, thank you for bringing this forward and the members of this
committee. and i also want to say that this text that we're using says, do you have a question. we're not here to answer questions only. we're also here to make comments. that needs to be changed in the technology. we were never consulted, the public, about how the technology would be set up to serve us and there should be a form about that. and our input so that it serves us. to assume that we're just here to question is to deny our right to comment. and it suggests that is our only purpose. so, thank you very much, and please support midtown. they have worked so hard, as have many people in the city, including d.s.a., and i thank you again. >> clerk: thank you for your comments, magic altman. can we have the next caller, please. >> caller: hi, this is renee curran and i spoke two weeks ago and my message is basically the same -- please recognize that rent controls are a small and
reasonable ask by the midtown tenants who have endured so many indignities. after many lost their homes to redevelopment they made the best of things and formed a cooperative community. through no fault of the tenants, the disrepair is from the city's negligent. and the solution was to take away many of the tenants' right, the promise of ownership, and to have the rents raised. this must be corrected now through this legislation. thanks. >> clerk: thank you for your comments, renee curran. can we get the next caller, please. >> caller: hi, i grew up in midtown. i have lived there from the age of 8 to about 32. and i raised my -- a couple of my kids there. and i want to request that you all please consider rent control for midtown apartments. it has been a long battle for
the residents there and many of them are elderly now and i just pray that you have a heart to try to help this community. thank you. >> clerk: thank you very much for your comments. can we get the next caller. >> caller: yes, hello, my name is mary ann makalvoy and a professor that has worked with midtown since 2013, and i'm a reporter and a researcher and i wanted to call in again and thank this committee for co-sponsoring this legislation. and seeing how important this is and how this is absolutely essential to taking first steps to restoring some of the injustices that have been done to this community in the past and to creating a better opportunity for midtown in the future. including ownership, but especially for now stabilizing the situation that people are in
which is very precarious. so i thank the committee for supporting this and i urge the rest of the board of supervisors to please do the same. thank you. >> clerk: thank you for your comments. could you bring us the next caller, please. >> caller: hello. my name is michael and i have been a resident at midtown park apartments since 1980, that's about 40 years. i want to thank the committee members for co-sponsoring and recognizing the point of this legislation for midtown park apartments, which is for residents like me. it provides housing stability and a possibility of future ownership which is really important for all of the residents here in midtown. i want to thank all of the 11 members, and i ask that the 11 members of the board of supervisors support this measure and move it forward and for supervisor preston for reaching out to us in the process. thanks again and i urge you to support this legislation. have a great day. >> clerk: thank you for your
comments. could we have the next caller, please. >> caller: my name is donald griggs and i lived at midtown since 1983. i'm a retired u.s. navy traffic controller. i want to thank the committee for sponsoring in this legislation, and i ask that the entire board of supervisors support dean preston in his efforts. we have been fighting the demolition of our westend edition homes for years and dean preston has been our champion. with his support, we've made great strides towards rent control and ownership. and it is very important. thank you very much. >> clerk: thank you very much for participating in the process donald griggs. can we get the next caller, please.
>> caller: hello [broken audio] long-time resident [broken audio] for the neighbors. [broken audio] >> clerk: pardon me, caller. i am going to pause you. could you speak directly into the microphone? we are having difficulty hearing you. >> caller: [broken audio] for midtown residents. thank you very much.
>> clerk: if the call arer is sl there? if the caller is not still there, could you bring us to the next caller, please. >> caller: hello, i hope that you can hear me. this is anastasia, a member of the san francisco tenants' union. thank you for helping midtown tenants in their struggles for homeownership and keeping them in their rental homes by this legislation that you're proposing. please send this forward to the full board as a committee report. thank you. >> clerk: thank you very much. could we go to the next caller, please. >> caller: yes, thank you for the opportunity. my name is curtis trout and i am also a child of midtown.
graduated from george washington high. i would say that broken up cellphones -- something familiar and unique to midtown because of the concrete structure, the sticky bushes and the courtyard. for safety we see the businesses that we grew up with around the neighborhood are gone to bigger and better things. and the one oasis that is left is midtown. so we thank mr. preston and the board of supervisors for considering this and we have to continue to support the residents of midtown in their efforts to maintain their homes, because we know that one of the greatest issues in san francisco right now is affordable housing. and so for you to continue to support the residents is a blessing and we thank you for the opportunity. >> clerk: thank you very much.
could we get the next caller, please. >> caller: hi, i am calling in support of the legislation for rent control. i -- we all on this call hopefully know that this city has gone over the westend area for more area. and especially the tragic destruction of culture, livelihoods and such a vibrant community during re-development. and it's all legacy of the community's collective strong response to that tragedy by banding together. as a first step in acknowledging the wrong that we have done, please pass this simple legislation and honor this, and to continue the struggle.
thank you. >> clerk: thank you for your comments. could you see if there's another caller, please. >> mr. chair, that completes the queue. >> chair mar: thank you so much, operations, and mr. clerk. hearing no further callers, public comment is closed. colleagues, any questions before we move to take action? >> no, i think that the public commenters, both at your last hearing and this hearing said it better than i possibly could, the importance of this legislation and of midtown more broadly in the fabric of our community in the western edition. so we urge the various motions as i described earlier. thank you. >> chair mar: thank you again, supervisor preston. so per your request, i would like to move that we duplicate
the file, that we accept the amendment presented today by supervisor preston. that we send this item as amended with positive recommendation as a committee report to the full board on october 6th. and that we continue the duplicated file to the call of the chair. >> clerk: sounds good. on the motion as offered by chair mar that this item be duplicated, that the original then be amended and that the amended version of the ordinance then be recommended to the board of supervisors as a committee report, [roll call] mr. chair, there are three ayes on those motions and there's one that i missed but we can take a separate roll on and that is the motion to continue the duplicated file to the call of the chair. on that motion offered by chair mar [roll call]
mr. chair, there are three ayes on that motion as well. >> chair mar: thank you. thank you. mr. clerk, can we call item number 2. >> clerk: yes, just one moment. agenda item number 2 is an ordinance amending the administrative code to require notification to prequalified contractors and written documentation of contractor selection from pre-qualified lists. and written documentation of contractor selection for work assigned under as-needed public works professional services contracts and to require the controller to audit such selection documentation. members of the public who wish to provide public comment on this ordinance should call the public comment number. it is still 1-(415)-655-0001.
enter the meeting i.d. for today's meeting, that is 1467042839. press the pound symbol twice to connect to the meeting and then press the star key followed by the number 3 to enter the queue to speak. a system prompt will indicate that you have raised your hand. please wait until the system indicates that you have been unmuted and you may then begin your comments. mr. chair. >> chair mar: thank you, mr. clerk. i would like to welcome supervisor stefani who is a sponsor of this measure and thank you, supervisor stefani, for bringing this forward. really as a follow-up to the -- to the first controller's office of integrity report on d.p.w., on contracting practices, and with the very troubling findings from that first controller's report. so thanks, supervisor stefani. >> supervisor stefani: thank you, chair mar. and, yes, i know that all of us were very disturbed at what we heard and we're all reacting to that.
as a former department head i was just aghast at what, you know, our former public boards director was able to do and very curious as to how he went about it. so i really appreciate the public integrity review report that the controller's office did, our city auditor did. and that report helped this legislation. so, again, thank you for scheduling this item today. and i do want to thank the committee for your patience while we work out the technical details associated with this legislation. and, again, thank you, chair mar, for being so willing to reschedule the item. this proposal will amend the administrative code to close two loopholes that former director of public works used to direct the contracts to recipients without any solicitation, documentation, evaluation or oversight. this was drafted to respond to recommendation number 4, which is page 40 in this report.
and the city auditor's public review of public works contracting. it creates a new strict set of rules governing the use of prequalified contracting tools and as-needed professional service contracts. which gave the department heads broad discretion to direct certain kinds of contracts to specific individuals and these were, of course, rife for abuse. for the use of pre-qualified pools, this ordinance will require that the department must notify all of the qualified list entities of the availability of funding, and then document this selection process. so there's a pool for people who are -- could provide cement to the city, let's say, and six people are on that list, you can't just pick a friend and not tell the other five people which was allowed before. so the selection documentation
prepared by the department in this ordinance must at minimum describe the following -- how the commodities and/or services meet the department's needs, how the proposed contractor is best qualified to provide the commodities and/or perform the services, or explain why the nature of the commodities and/or services requires use of that specific selected contractor. and the anticipated costs to the city. and then make a determination that such costs would be in the best financial interest of the city. so with regard to as-needed professional service contracts, this ordinance will require that the department issuing any contract service order under the contract must document this selection process. the selection documentation must address the following -- how the workers' services are required to meet the department's needs. how the proposed contractor is uniquely qualified to perform
the services, or to explain why the nature of the services required use of that specific selected contractor. and, of course, with the anticipated costs to the city will be. and then make a determination that such costs would be in the best financial interest of the city. the amendment that i am introducing, and this is why we had to continue it from last time that i appeared here because we wanted to work out this amendment -- it was drafted in close coordination with the office of contractor administration and as an additional layer of scrutiny for contracts that are over the minimum competitive amount. so the minimum competitive amount is set annually by the controller's office. and it is currently $129,000 for commodities and $706,000 for general services. so the administrative code normally requires that the contracts exceeding the minimum competitive amount undergo a
formal solicitation process. however, contracts done through the pre-qualified contracting pools that i just described are not subject to this requirement. so this amendment will close that loophole by bringing pre-qualified pools into alignment with the standards used in other contracting vehicles, and requiring a full, formal solicitation and the process that o.c.a. requires as part of that process. so according to our city auditor, the former director of public works used these contracting tools to issue over 150 contracts, totaling over $250 million over the last three years. according to our city odd city r would use very little justification and this ordinance is going to correct that. this proposal means that anytime that one of those contracting vehicles is used, that the other
qualified vendors will be notified and the department will have to document their justification for whom they selected. no matter what the amount, we will no longer be left wondering who got what funding and why basically. we have the office of contract administration to provide a short presentation on the draft ordinance and the amendment that i just described. she's also here for any questions. we also have the city auditor here. i know that it was a lot that i just described, but i am very thankful to the city attorney's office for helping us to work through this one recommendation. obviously, i know that supervisor haney is also on this. and i appreciate him for that. we're all like i think looking at what we can do. like i said, we are all very upset about what happened and i think that closing those loopholes, making our department heads more accountable, making the process transparent is exactly what we need to do. and i think that this
ordinance -- actually, i believe that this ordinance does this and, again, i want to thank the city attorney's office and my aide for drilling down on this and figuring out how to stop the abuse that we have seen. so with that i would like to invite salajiah to give her presentation. >> hi, good morning, supervisors. and thank you. i'm the acting director of the office of contract administration and i'm pleased to be here today to discuss the proposed administrative code, chapter 21, legislation that supervisor stefani has put forward. so i'll provide some background information on chapter 21 specifically and particularly chapter 21.4 as it exists today. followed by a summary of the proposed changes to this section. and pardon me if i repeat some of the same information that supervisor stefani just provided. so next slide, please. thank you. chapter 21 of the administrative code goch es the procurement of
goods and services, commodities and professional services. and very generally the chapter 21 regulations require that the departments conduct a competitive solicitation, basically a public bidding process to award any contract above a certain dollar value. competitively bid contracts must be awarded based on the evaluation and ranking of the qualifications or combination of the two. this threshold dollar value is called the minimum competitive amount. and the minimum competitive amount as supervisor steph stated is currently set at $129,000 for commodities and professional services. and $706,000 for general services. i should note that the office of contract administration chapter 21 rules and regulations also require departments to conduct solicitation for procurements below the competitive amount, but the bidding process in that case can be done a little bit more informally. so section 21.4 sets forward the
requirements for competitive solicitations, including what is called the request for qualifications process. with the request for qualifications the departments can create a pool of vendors that meet the basic minimum qualifications for providing a particular good or service. this pool of vendors are thus prequalified. it's important to note that currently with the request for qualifications process, any contractor in the pre-qualified pool can be awarded a contract without any further competitive solicitation. no additional assessment or evaluation of vendors in the pool is required to determine which vendor offers the best price or is uniquely qualified for the contract. thus, departments are allowed to select any vendor within that pool for a contract once it is established. they can also award multiple contracts to the same vend are in the pool without competitive bidding. next slide, please. thank you. as you know the controller's
office has recommended reform to this particular section of the administrative code in response to the controller's offices findings. o.c.a. has coordinated with supervisor stefani's office and the department of public works and the public utilities commission to put forth revisions to this section. our joint proposed amendments serve to strengthen the request for qualifications contracting process. so in particular the language that we have proposed now requires departments to conduct a further competitive solicitation to all vendors within an r.f.q. pre-qualified vendor pool when the contract value is greater than the minimum competitive amount. the minimum competitive amount is the value that departments must have have solicitations to award a contract under chapter 21 legislation. so our proposed language now establishes that same competitive bidding threshold for r.f.q. vendor pools. for contracts below this minimum competitive amount the
departments can more informally award a contract to a vendor in the r.f.q. pool. they are still allowed to directly select a vendor in the pool without competitive solicitation, but now they'd be required to document their justification for selecting a particular vendor for a contract as specifically indicating the vendor's unique qualifications and the cost to the city. pre-qualified vendor pools established the request for qualifications are valid up to four years as long as the issuing department reopens the r.f.q. after two years. so this allows other vendors the opportunity to become prequalified. please note that we have not proposed any substantive changes regarding this language on updating pre-qualified vendor lists. i should note that o.c.a. does not use r.f.q. pools frequently, but when we do use them, it is already our standard practice to follow the solicitation rules and conduct the further invitation for bids to all
vendors in the pool just as we're proposing here. o.c.a. believes that this proposed legislation will ensure all departments follow similar best practices when issuing contracts using pre-qualified vendor pools. and more generally the proposed legislation serves to create greater controls and transparency while still allowing some flexibilities, flexibility, when the departments use these pools. thank you. >> chair mar: thank you so much for that presentation. and thank supervisor stefani for all of your work on really important measures to provide more transparency and oversight to the use of pre-qualified contractor lists. any further -- >> supervisor stefani: thank you, chair mar. and i want to say that the amendments that i would like
this committee to adopt today i am told are substantive so they would have to sit for a week or whenever your next meeting is. so if my colleagues have any questions, i am here. obviously, we have the city auditor here. so i hope that i can have your support. >> chair mar: great. supervisor haney? >> supervisor haney: thank you. and thank you, supervisor stefani for your work on this and for the amendments. absolutely appreciate your leadership on addressing these issues and bringing some of the recommendations from the public integrity review. i had one question. so for the contracts that are above the minimum competitive amount, would these amendments -- would there be anything that would prevent the departments from ranking their pre-qualified
pool rather than going through a formal solicitation and using that to kind of subvert the process? are we able to address the ways in which ranking could create some challenges and continue some of the problems that we have seen in public works >> yes, if i may respond. feel free if you would like to respond, supervisor stefani. >> supervisor stefani: i was going to ask you to respond. i was going to ask you. so thanks. >> great, thanks. so, yes, the legislation is basically saying that above the minimum competitive amount the departments must conduct a competitive solicitation that generally would be a formal competitive solicitation whereby the departments must comply with all general solicitation
requirements. in the case of commodities, generally we do that as a low bid. so the vendor that is providing the best and the lowest price would be awarded the contract, as long as they're a responsible bidder for services. and that applies for typical services. and usually those solicitations are based on best value. so the departments base their evaluations on qualifications, which bidder is most qualified, has the most experience, as well as potentially taking into account price. that evaluation process is fairly prescribed by the competitive bidding rules, c.n.b. generally gets involved. the requirements or the proposal selection criteria are generally published and provided to the bidders ahead of time so they are basically understanding they
are evaluated on the fair basis and they know what the criteria are going in. and then generally the ranking or the evaluation are done by a panel of typically subject matter experts that are not the -- the individuals who prepared the request for proposal. so they had no part -- they would generally have no part in developing the request for proposals or other solicitation documentation. >> supervisor haney: great. that's very helpful. and i'm definitely in support of this and, again, i appreciate everyone's hard work and leadership and i would love to be added as a co-sponsor. thank you again, supervisor stefani. >> supervisor stefani: thank you, supervisor haney. >> chair mar: supervisor. >> i was going to ask to be added as a co-sponsor.
>> clerk: added. >> i would like to be a co-sponsor too. this is a very important measure. thank you so much, supervisor stefani. >> chair mar: going to public comments, are there any callers on the line for this item? >> clerk: thank you, mr. chair. operations are checking to see if we have callers in the queue. for those who already connected via phone press star and followed by 3 if this is your item of interest and you want added to the queue. for those on hold in the queue wait until you are prompted to begin. you will hear a prompt that informs you that your line has been unmuted. for those who are watching our meeting on cable channel 26 or via streaming link or through sfgov-tv.org, if you wish to speak on this item call in now by following the instructions on your screen. by dialing 1-(415)-655-0001. then by entering the meeting i.d. of 1467042839.
press the pound symbol twice. and then press star, followed by 3, to be added to the queue to speak. can you connect us to our first caller. >> caller: hello, this is anastasia ananpolous and thanking supervisor stefani and all of the supervisors who are agreeing to co-sponsor the measure. the vendors need to be scrutinized. the vendor pools need to be looked into. and when awarding the contracts. thank you. >> clerk: thank you very much for your comments. can we get the next caller, please. >> mr. chair, that completes the queue. >> chair mar: thank you so much, operations and mr. clerk.
hearing no further callers, the public comment is closed. i would like to honor supervisor stefani's request and move that we accept the amendment of supervisor stefani presented today. >> clerk: on the motion to amend as offered by chair mar [roll call] mr. chair, there are three ayes. >> chair mar: thank you, mr. clerk. and then we'll need to continue this item. can we continue it to the call of the chair as amended? >> clerk: if that's your motion. >> chair mar: yeah. >> clerk: okay, on the motion as offered by chair mar that the item be continued to the chair of the call as amended [roll call]
mr. chair, there are three ayes. >> chair mar: thank you. supervisor stefani, i did want to say that we're still working out the agenda for the upcoming j.o.a. committee meeting so i'll commit to agendizing this as soon as the opportunity is possible. >> supervisor stefani: thank you, chair mar, and thank you for the co-sponsorship, and thank you supervisor haney for his work, especially on the upcoming item 4. and if i could add my name as a co-sponsor to that, i would like to. >> clerk: i will enter you as a co-sponsor for agenda 4. thank you. >> chair mar: thank you. great. mr. clerk, can you please call -- where we are -- on item 3, yeah. please call item 3.
>> clerk: that's right. agenda item number 3 is a motion directing the budget and legislative analyst to conduct a limited scope performance audit of sewer repair to determine if savings could be achieved through a restructuring of sewer repair work orders between public works and public utilities commission. if this is your item of interest, and you wish to provide public comment on this motion you should call the public comment number now. that number is 1-(415)-655-0001. and enter the meeting i.d. for today's meeting. 1467042839. press the pound symbol twice and then the star key and followed by 3 to be in the queue to speak. mr. chair. >> chair mar: thank you, mr. clerk. colleagues, i did want to report that supervisor ronen who is a sponsor has requested that we table this item. so, yeah, i guess that we -- i don't know if have any questions
or remarks on that? why don't we go to public comment. >> clerk: thank you, mr. chair. operations will check to see if we have callers in the queue and i will repeat the call-in routine one more time. for those who connected by phone press star and followed by 3 to be added to the queue to speak for this item. for those on hold in the queue continue to wait until you hear a prompt informing that your line unmuted. for those watching our meeting on cable channel 26 or via streaming link through s.f.o. s.f.o..org -- sfgov-tv.org, you can call in by calling 1-(415)-655-0001. and entering the meeting i.d. of 1467042839. and then by pressing the pound symbol twice you will connect to the meeting. following that press star, followed by 3 to enter the queue to speak. do we have any callers waiting to provide comment on agenda 3? >> mr. chair, there are no callers in the queue.
>> chair mar: thank you, operations. public comment is closed. mr. clerk, do we need to take a vote on the motion to table this item. >> clerk: we should have a move and a roll call vote. >> so moved. >> clerk: on the motion offered by vice-chair peskin to table item number 3 [roll call] mr. chair, there are three ayes. >> chair mar: thank you, mr. clerk. can you please call item number 4. >> clerk: yes. agenda 4 is an ordinance amending the administrative code to prohibit the mayor from designating the department head as the mayor's designee regarding contracting decisions and other matters in which the mayor has discretion to delegate a designee to review a department head's proposals. if this is your item of interest, now is the time to get
into the queue to speak for this item. call 1-(415)-655-0001. then by entering the meeting i.d. for today's meeting of 1467042839. press the pound symbol twice to connect to the meeting and then press the star key, followed by the number 3 to enter the queue to speak. a system prompt will indicate that you have raised your hand. wait until the system indicates that you have been unmuted and that is your opportunity to begin your comments. mr. chair. >> chair mar: thank you. supervisor haney, thank you for sponsoring this really important measure. yet another action -- or measure that is in the wake of the -- yeah, all of the revelations around misconduct and fraud, you know, in our public works department and other departments. so thank you, supervisor haney. >> supervisor haney: thank you, chair mar, and i thank you for your support. this legislation as you mentioned, chair mar, follows
the controller's public integrity review in response to the corruption in the department of public works. the departments fall under the oversight authority of a citizen oversight commission that play a key role in reviewing and approving contracts and other major decisions. however, for the handful of departments where no oversight commission currently exists, the mayor is responsible for applying that critical oversight function. this oversight is meant to provide a critical system of checks and balances and there are approximately 30 places in the administrative code that outline approval processes for contracts, procurement, the destruction of records and other areas where either a board or a commission has to take an approval action. or if there's no commission, the mayor or the mayor's designee must take the action. the most significant example of this is the award of public service and construction
contracts in excess of $706,000 that require approval by the mayor or the mayor's designee in the absence of a commission. the problem is that as we are now well aware at the department of public works, is the instances where the mayor can designate someone to exercise her or his approval authority. there is nothing stopping a mayor from giving the approval authority back to the department head that the mayor is designed to be overseeing. as we know in august 2011, mayor ed lee designated mr. nuru as the director of public works to act on the mayor's behalf in the approval of various aspects of the contracting process, including to award all public work professional service and construction contracts in excess of the threshold amount. which is currently set at $706,000. this was done in compliance with
chapter 6, but what essentially was done in that case is that the mayor's office then had no approval role or oversight for public works contracts of that size and the sole authority was delegated to the head of public works themselves to approve contracts, allowing director nuru in this case to essentially oversee himself. i don't think that was done with any sort of nefarious purpose by the mayor at the time, i'm sure that it was intended to streamline things, but what it did allow for is a huge loophole which provided space for director nuru to engage in deeply unethical and corrupt practices. this is a huge reason why director nuru is suspected of handing contracts to friends or people with deep pocketed connections and doing so with
tremendous discretion and lack of oversight that does not exist in other departments. closing this loophole was a primary recommendation of the controllers first public integrity review. and the current controller's recommendation and the report was, quote, under chapter 6 of the administrative code, they should have contracts to an official rather than the department director, and the mayor and the board should amend chapter 6 to prohibit delegation to the department head for these contracting activities. this legislation does exactly that. it prohibits the delegation of final and sole approval authority from being given to the director themselves, which is currently permitted, not just in chapter 6 but in over a dozen references, including in administrative code, chapters 8, 10, 14 and 21. although after the nuru scandal was revealed mayor breed reversed the decision to give
the public works director sole contract authority and i thank her for doing that. but as it stands the city law does not prevent this from happening in the future and it is a responsibility of the board of supervisors to close loopholes and strengthen laws that prevent fraud and corruption. the way that it is now our contract oversight system is designed with loopholes that are ripe for fraud and it's crucial to close those loopholes to protect the city and the county of san francisco's precious dollars and ensure that all of the decisions are made with appropriate oversight in the interest of public trust. i want to thank the controller for these recommendations. deputy city attorney taylor for their partnership. courtney macdonald from my office. and to supervisors mar, ronen and stefani for co-sponsoring. >> chair mar: thank you, supervisor haney, for all of your work on this. supervisor peskin.
>> supervisor peskin: i would like to be added as a co-sponsor. >> chair mar: fantastic. thank you. why don't we go to public comment on this item. are there any callers on the line? >> clerk: thank you, mr. chair. operations will check to see if there's any callers in the queue. let us know if there are any callers that are ready. for those who already connected via phone press star, followed by 3, to be added to the queue if you wish to speak for this item, agenda item number 4. for those already on hold in the queue, wait until you are prompted to begin. you will hear a prompt informing you that your line has been unmuted. that is your opportunity to provide your comments. for those who are watching our meeting on cable channel 26, or via streaming link at sfgov-tv.org, if you wish to speak, call in now by following the instructions displayed on your screen. by dialing 1-(415)-655-0001. and then by entering the meeting i.d. of 1467042839. and then by pressing the pound
symbol twice you will connect to the meeting. once you are connected to the meeting press star, followed by 3, to enter the queue to speak. could you connect us to our first caller, please. >> mr. chair, there are no callers in the queue. >> chair mar: thank you, operations. public comment is now closed. supervisor haney, do you want to make a motion. >> supervisor haney: yes. i believe that the -- can we send it to the full board as a committee report? how do we -- or does it have to come back. >> clerk: this was not agendized as a committee report and can be recommended to the october 20th board meeting. >> supervisor haney: i would like to move to have this recommended -- moved with a positive recommendation to the full board on october 20th. >> clerk: the motion offered by member hane that this item be recommended to the board. [roll call]
mr. chair, there are three ayes. >> chair mar: thank you, mr. clerk. can you please call item number 5. >> clerk: agenda 5 is a hearing on the progress and findings of the investigations into public corruption. members of the public who wish to provide public comment on this hearing should call the public comment number that is 1-(415)-655-0001. and enter today's meeting i.d. of 1467042839. press the pound symbol twice to connect to the meeting and the star key followed by the number 3 to enter the queue to speak. the system prompt will indicate that you have raised your hand. wait until the system indicates that you have been unmuted and that is your opportunity to begin your comment. mr. chair. >> chair mar: thank you so much, mr. clerk. colleagues, i called for this hearing to continue our important role as a government audit and oversight committee, monitoring and providing public
transparency to the ongoing and widespread investigations into corruption in our city government and misconduct by city officials. today's hearing, which is very timely, given the consideration that we had on items 2 and 4, will -- this will focus on the findings from the second public integrity review by the controller's office which shines a light on supporting benefitting city departments from city contractors and building permit applicants and holders through non-city organizations, including so-called friends of organizations. i do want to thank the controller's office for all of their work looking at and analyzing the systemic and structural weaknesses in our government operations that has allowed corruption to continue for far too long. the controller's first public integrity review public works contracting back in june covered the number of extremely troubling practices that allowed
misconduct, particularly by the former director nuru and thanks to again to supervisor stefani and supervisor haney for your important legislation. you know, and as a follow-up on that the first report. so i look forward to the presentation today from the controller's office on the second public integrity review and similar follow-up actions that we can take as a board to address the findings. and i know that supervisor haney and peskin, you guys are already a step ahead working on this. before we go to the presentation by the controller's office, colleagues, do you have any remarks? great. so i'd like to welcome mark dell a rosa from the controller's office that will give us the second public integrity review.
mr. delarosa? >> yes, good morning, chair mar. and supervisors peskin and haney. mark delarosa, with the controller's office. let me -- am i able to share? yes, actually i have my presentation up. >> we can see it. >> perfect. good morning again. today we will be presenting to you the results of our second preliminary assessment as part of our public integrity reviews. as has been alluded to in previous agenda items number 2 and number 4, the first report that we issued was back in june on the public works contracting and procurement which we presented before this committee back in july. this is the second installment
of a number of assessments that we're doing surrounding the nuru investigations. as previously mentioned our focus in the controller's office has been to review the various internal control weaknesses that occurred as part of the various scenarios surrounding the allegations. the second one that we issued last week is titled "gifts to departments through non-city organizations lack transparency and create pay-to-play." just by way of background, as mentioned back in february we began to conduct these public integrity reviews to look at the various internal controls and processes and policies surrounding the various allegations. really the main goal of our assessments have been to -- to provide some recommendations on
how to improve transparency and reduce the risk of fraud in the city and ultimately to safeguard public funds. in conjunction with the controller's office efforts, the city attorney's office has been focused on their various investigations surrounding misconduct by the former city employees, and current and former city employees and city contractors and vendors. a very recent example of the efforts they have done is that at the beginning, at the start of the department process for one of the contractors that has been implicated in the mohammed nuru investigations. today's report is basically going to focus on the results of our review related to the gifts and support that have benefitted the city departments from city contractors and with a specific focus today on the san francisco public works sub-accounts that
were held by the san francisco parks alliance which is a non-city organization. as we did in our first assessments we offer these preliminary assessments and offer for public comment and review. and through form forums such as this g.a.o. committee we welcome any input and feedback that you have that will help further solidify or finalize our report which we will be working on in the next few months. again, by way of background, we have been using -- or throughout the report that we issued last week, we used the term "non-city organizations" and this is just to provide you with kind of our working definition within the context of our report. really non-city organizations are non-profit organizations or third-party organizations that
provide financial or program attic support to a department to meet a certain goal and that goal can be to improve the delivery of the government services and to meet philanthropic goals and the training and development of city employees as well as to provide support services to that department. one thing that we did as part of our field work related to this topic was that we tried to get a sense of how prevalent the presence of these non-city organizations with non-city accounts were throughout the city. and so we had a survey in february of all 56 of our departments and we found that 33 of our departments actually do have some sort of an account or sub-account related to a non-city organization. it really ran the gamut in terms of the type of set-up and connections that they had.
most were actually a part of the usual city process of contracts and grants and those were through the fiscal agents, fiscal sponsors, the grants and contracts that i mentioned, certain foundations. and then the friends of organization, which is basically the focus of our report. and generally speaking, these friends of organizations are really intended to financially support the department and the various activities and objectives that they have. and they're a primary source for the revenue. and for the friends of the organizations are generally donations from various entities. more specifically parks alliance is the subject of our report in connection with the public works sub-accounts. they are a 501c3 non-profit organization working with a
number of groups and city agencies and departments. in 2019, i just provide context into their operations, they had a total of about $19 million in contributions or revenues. they spent about close to $18 million of that and for that calendar year 2019 alone. i just wanted to add before i continue on with the findings and recommendations that we did provide parks alliance with a draft of our findings and recommendations. and one of the key things that they noted and we would like to include it here is that they were not aware that their fiscal agency was being used unethically by the public work city officials. the parks alliance did try to reach out to mr. nuru back in 2019 to formalize their relationship by forming an m.o.u., memorandum of understanding, but that effort
was ignored by mr. nuru according to the city parks alliance. again, as a background, the sub-accounts that we mentioned throughout our report are basically these four sub-accounts that support the various aspects of the public works operations. so based on the data that we gathered, which is from july 2015, through january 2020, these were the four sub-accounts that specifically related to the department of public works. the first sub-account is the -- it's called d.p.w. special projects. and this is basically where most of the payments and reimbursements for various activities, including staff appreciation, staff picnics and various -- various efforts related to staff appreciation.
and that amounted to about 40% of the contributions out of the 990 for that five-year period. and the second sub-account is called the d.p.w. clean team. and this is the department's neighborhood beautification program. and that amounted to about 20% of the coun contributions. and there's the giant sweep, which is another sizeable portion of the overall public works sub-accounts at parks alliance, totaling about $390,000 for the in-kind contributions for the five-year period. and there's a small sub-account that was indicated called the fix-it accounts that was about $290,000 in the contributions. again, by way of background and context, as mentioned, most of
the operational revenues of these friends of are typically from donations. this is highlighting the public works sub-account that the san francisco parks alliance, and this is just highlighting some -- not all of the donors that contributed to the parks alliance -- the public works sub-account within parks alliance. and as you can tell, s.f. clean city coalition is a pretty sizeable donor to this fund, about $721,000. this is for, again, the five-year period that we were able to provide. one thing that this table looks at in addition to indicating the main donors is the activities they also have -- these donors have in terms of actual payments that are remitted from the
departments, including public works, from the contracts that they actually have existing with them or through purchase orders that are let by the department. another column that we highlight here is the permits at time of donation, given that this is part of the definition, as i'll talk a little bit more later on the interested party. but this basically provides an overview of the various sources of the funds as well as the activities of those donors. as far as the expenditures, we're concerned for this sub-accounts. basically most of the spending was for employee events, including staff appreciation, the holiday parties that they had, and picnics and conference awards. they also have a section of the expenses categorized as various
items related to their volunteer programs and that is the giant sweep clean team. and also a good portion of the expenditures that we found is for the five-year period totaling $980,000, a portion of that was for merchandising, as well as community support and other miscellaneous expenses. this is just a graphical representation of what i have discussed in the previous slides, how, you know, our department of public works would remit payments to these city contractors through the usual businesses that they have, including paying a contractor for either the building of certain infrastructure or in meeting some of the capital program projects that are in the
city's capital plan. so public works would remit payments to the city contractors, and those very same contractors basically are the ones who also -- or at least a portion of them -- would provide donations to this -- for lack of a better term -- friends of account public works had with parks alliance. and those funds in turn that were from the donated funds would be used to fund the various projects that i just mentioned. some of those -- a portion of those reimbursements were to various vendors, including those that we also do business with as a city. as well as individuals or public works city employees, among others. i'll go through now the five
main findings that we had in our report. the first one being the inappropriate fundraising. this really -- just as a way of background to -- as you may already know that the payments -- referring to payments made for legislative, governmental or charitable purposes at the suggestion or the request made of -- or in cooperation, consultation with a public official. as required by the city when payments of a thousand dollars or more is made at their behalf by an interested party, certain city officials -- and currently how that is defined are elected officials as well as our commissioners -- must file the city's form sfc3610b which is the behested payments city officers form. as mentioned these are basically
members of the board of supervisors such as yourselves who are elected and the mayor, the city attorney and the district attorney, treasurer, assessor, public defender and the members of board or commission are required to file form 700. one example that we provided in our report was the perceived pay-to-play relationship that occurred from the example of the 2019 office of the city administrator and public works holiday party in which mr. nuru solicited donations to fund this specific holiday party. and out of the $40,000 in total costs for this event, about 80% of those -- or $33,000 -- were from such sources as recology that has a department with public works. our finding then basically
drives the recommendations that we have related to this topic. and the recommendations that we have include amending the campaign in-government conduct code to prohibit non-elected department heads and employees from soliciting donations unless specifically authorized by the board of supervisors. those authorized to solicit donations must file form sfc3610b for behested payments. we also recommend that the department should comply with the admin code 10.100-305, formally obtaining advanced acceptance of any gifts from outside sources greater than $10,000 for the department through a non-city organization. we are also recommending as part of this topic that the city should require annual certifications from the department heads that all gifts
of goods, services and funds, that have been approved by the board and reported on time, that they should be -- actually approved by the board and reported on time as required. and also a couple more oversight aspects of this is for the controller to on a sample basis annual cycle audit the organizations that both give gifts to the city and have a financial interest with the city. and one of the more general recommendations that we have provided is this one that for all of the recommendations that are made as part of this assessment, the city should review and strengthen its consequences for non-compliance, just to make sure that to yet provide another set of teeth to the -- to the revised policies. and the second set of findings that we had related to interested party definition, being unclear, -- one of the --
basically the bottom line in this -- this finding is that the interested party definition for behested payments does not clearly include all city contractors. according to the ethics website, the donor is only required to file the form if he or she is an interested party which means that person who is part of the proceedings regarding permits, licenses or other entitlements. and basically the city's definition of an interested party does not explicitly include all city contracts. and one of the key points is that when city contractors with any contract donate to non-city organizations such as what i have just described with the public works sub-account it creates a pay-to-play relationship. so the corresponding recommendation on this is for
the ethics commission to expand the definition of who is considered an interested party so that it includes city contractors. when the next is for donations which is currently prohibited. as you may already know that the city sunshine ordinance requires no city official or employ must- employee must not have a gift in the amount of $100,000. and to whether the donor has a financial interest with the city. according to the city attorney, a financial interest is any contract, grant or lease or request for license, permits, or other entitlements with or pending before the city. so really the recommendation that we have in relation to this
is that the departments should comply with the sunshine ordinance, section 67.29-6 for their non-city organizations by not accepting any donations through anonymous donors or which they cannot identify the true source. and the other corresponding recommendation on this is for the city to amend the sunshine ordinance to clearly define financial interests. so that it is aligned also with the city's updated interested party definition that we are recommending. the last two findings that we have basically relates to the expenditures and the oversight related to those expenditures on the sub-accounts. the next one is basically that the sub-account itself lacks certain elements of oversight or internal controls.
as mentioned in the report itself, the public works subaccount at parks align really operated very much like a city accounts in that invoices were directed and approved by public works employees, and with public works and the parks alliance. although all of those transactions were happening outside of the city's procurement and financial system. because they weren't operating within the city's purview, they were not subject to the same reviews and controls that would normally occur within the city structure. one thing that we looked at was when we were surveying the various departments with friends of accounts or organizations, we looked at what internal controls they had to see how -- or how we could inform the recommendation related to this finding. and this table right here
basically provides a very simple side-by-side comparison of the friends of the san francisco public library structure compared to the rec and parks, parks alliance accounts. and then what public works has with parks alliance itself. some of the key policy and processes and internal controls that we highlighted that were missing in the public works sub-account were having a memorandum of understanding or an m.o.u. of some sort that defines the relationship with the city. that was present in the public library friends of, as well as the rec and parks parks alliance account. they also both -- rec and park and public library -- also had a provision within those m.o.u.s to basically to go through and accept and expend a process for
any gifts that they received within a certain threshold. and then also the third control that we call out here is the compliance with the sunshine ordinance section on the anonymous donation. basically the recommendations follow that the city should require the departments and non-city organizations to formalize their relationships through m.o.u.s that are posted on the department's website and include these various -- various elements, including the requirement to adhere to certain provisions of the admin code of the sunshine ordinance, claus and clauss within those m.o.u.s and the public reporting as well as the public reporting of the grants on their website. and also having a clearly defined set of rules for the expenditures as well as the operational aspects of the
sub-accounts. and the last but not the least finding that we had was the public works sub-accounts funded staff appreciation efforts. and this is something that is not normally included in a city department's budget. so what the public works did was basically they used the parks alliance sub-accounts to fund for the various efforts they had on staff appreciation, which we recognize as critical as they, you know, provide for an increased morale and recognition of the good work. however, the way that it was funded was not -- was not -- was not appropriate. so the recommendation is basically that we had as it relates to the funding of the staff appreciation for the city departments and to make it easier for the departments to use city funds for staff
appreciation events and provide explicit appropriations for this purpose so there's more sight line and oversight into this line item. so that concludes our findings and recommendations. just very quickly on the next steps that we have, as mentioned, we have completed two assessments so far. we have a few assessments that are currently still ongoing and that will be completed in the next few weeks, if not months. the first is on the ethical standards related to commissioners. another one -- another work product on the contractor development process for the city. and another on the d.b.i. inspections that the department of building inspections policies and procedures for their permits awarding process. and then we're going to -- and as we're going along we are going to be adding additional reviews and assessments as
needed as we continue and finalize the various elements of this report. just very quickly, i wanted to just say thank you to the great team that we have in the controller's city services auditor who worked on this, kay chalk, as well as to the various city departments and agencies that provided input throughout this report. that concludes my presentation and i'm happy to answer any questions. >> chair mar: thank you so much for the presentation, mr. delarosa and for all of your work on this report and analysis. supervisor haney? >> supervisor haney: thank you, chair mar, and thank you for this presentation and for the work, mr. delarosa. i have a few questions. you know, one is -- this is obvious and blatant, you know, unethical behavior on its face,
essentially what director nuru was able to do was to set up a slush fund where without any oversight and without any sunlight and without any reporting, and without any process, was raising money from -- from interested parties, from contractors and using that money however he wanted. it subverted all of the protections that we have on how public money is used. but also on protecting against pay-to-play and perceptions of pay-to-play. so i do and i think that to our fellow -- to supervisor peskin and chair mar -- supervisor peskin and i introduced legislation this week which will address one of these recommendations which relates to both expanding the definition of interested parties and prohibiting in the case of interested parties these sort of
>> did you look at kind of what he was saying he needed to be reimbursed for. and other sorts of protections. are there other individuals who were reimbursed and any follow-through on looking into that? >> yes. as we mentioned and basically gathered information on this and primarily from the various records that we got from public works, as well as parks alliance, a good portion of the reimbursements were to some of the department staff. and so, for example, like a staff person at public works would foot the bill for an off site lunch, for example. what that staff person would do is would send the receipt for
that staff lunch to parks alliance and parks alliance will then cut the check as a reimbursement directly to the city staff. in terms of direct reimbursement to mr. nuru, we did not see any of that in any of the logs that we reviewed. some of the reimbursements, though, went directly to vendors that were -- that have been named in certain aspects of the nuru investigation, such as the walter wong, and then others that were included. nick bovas is another one that comes to mind in which -- nick would provide appear service or a good as part of one of the -- either staff appreciation efforts and so he would incur the cost and public works would then approve it, so he'll get
reimbursed through the parks alliance sub account. >> another question i had about that which is whether there were other departments or i should say specifically the city administrator. my understanding is the city administrator was aware that this was happening and maybe involved with it in some way. were there oversight mechanisms that simply failed here? or was the law unclear? i mean, it seems that a lot of folks, whether in the city administrator's office or the mayor's knew that this was happening. and i mean, should --what they were doing -- was it in
violation of our laws, even as they were before? i mean, should they have known that what they were doing was not legal? or wasn't legal. >> i certainly defer to the city attorney's office -- for any interpretation on the legality of what's happened. one thing that i would note, though, is that as part of our field work, the information that we included in our report on the tone at the top was from the office of the -- from the city attorney's office, their public integrity unit. that information that the office -- that the city administrator was aware of the fundraising efforts of mr. nuru came from them. i would certainly defer to them in terms of providing additional information in relation to that. and also to the legality of what
happened. >> okay. yeah because in the report it seemed a little unclear. it seemed that they still should have known that they should not have been raiding funded from -- raising funds from interested parties and that there was knowledge from the city administrator that money was being raised, but maybe not who it was being raised from is what i have since come to understand. but there's some lack of clarity as far as my understanding of what exactly was prohibited, even before some of the changes that we are making. those were the questions and comments i had. >> supervisor haney. supervisor peskin, do you have any questions or remarks? >> supervisor peskin: no. no. i read the report.
i really want to thank the controller's office and mr. delarosa and city controller ben rosenfield. it tells us something that we knew or should have known that there were questions that we all should have been asking, that we were not as asking. and it's just so unfortunate that we have to be reminded this way. look, i think the vast majority of people and city employees are honest and decent and hardworking. but it takes one total goofball. because we do vet so much trust to run through every part of the system. i have to tell you i am angry that we're having to spend all of this time, you know, and by the way going back to a decade
ago. there were supervisors like my former colleague chris dailey who tried to pass legislation that was opposed by administrations, not this administration. but a previous administration that would have tightened these things that we're tightening now. i do want to thank supervisor haney for this legislation, of which i am a co-sponsor. and i think it's really the beginning of the conversation. because when you can do this, because there is an assumption of trust and so many of our internal processes. what it says to me is it is really time to fundamentally, and i said this at the board of supervisors, change the relationship between friends of organizations and individual departments. and let me be clear about that, which is there is absolutely a role for true charitable, philanthropic giving to the city, whether it is a donation
or a bequest or one's favorite park or one's favorite library or the library department in general. you name it. but the cozy relationships, relationships plural, that happened between and i'm just choose one randomly. the friends of city planning and planning department needs to come to a full stop. what this city really needs to do is to create a department. and i don't think it will cost any additional money, because there are people who do this in individual departments and we can use those f.t.e. create one centralized department of philanthropic fundraising bequestses, donations. navigation, we -- any donation in the city is a tax-deductible donation. we are the largest non-profit in this city and county. but we should take away all of
the incentives for pay-to-play, insider training. nepotism, corruption and the best way to do that is to sever the relationships between friends of the library and the library. you know, the parks alliance and the parks department. let's just centralize that into one department and they can then work with the other departments. when there's true philanthropic giving, when they have a true intent and not to permit a contract or a dinner or an airplane trip that's the best way to prevent this from happening. i want to thank supervisor haney for working with me on that legislation, too. it's like,. >> commissioner haney:, look, if you guys messed up, we're going to take away your marbles. and you can't play any more. >> thank you, supervisor peskin. thanks to supervisor haney and you for working on the legislation to start addressing
these issues highlighted by the public integrity report. i really appreciate all of your work on this. and the focus on looking at the public works subaccounts with the parks alliance and i think that is clearly an example of abuse of this -- the friends of organizations and a department head. especially in light of all of the other documented and concerned misconduct by former public works director nuru in so many other ways.
i want to understand the scope beyond d.p.w. i know you highlight that there's 33 departments and you list them out that have non-city organization subaccounts or friends of organizations. around in your report, you sort of -- there's one part where you sort of contrast the public works subaccounts in the parks alliance with rec and park subaccounts, the parks alliance and the friends of the public library. , showing that they're -- at least the latter two have more controls in place. so i just wanted to understand -- or see if you can speak to whether -- what was happening with d.p.w. and director nuru, former director nuru in these accounts. and whether that -- whether
there's any indication that it's also in other departments. >> sure. and in relation to that, to the first point on the extent. so we really -- on this as part of this assessment, we really focused on the internal controls within public works. because they were the ones that were the subject of the nuru investigation. we did, as you mentioned and as i presented in the slides, we did gather some information. but it's very limited afternoon. what we do know is a very good portion of the 588 i think subaccounts or accounts that we allude to are actually very -- they're legitimate types of contracts and grants that actually go through the proper channels of, you know, being going through an r.f.p., on an awarding process.
so the connecting -- the connection between the departments and those non-profits are actually pretty legitimately and clear. i think that speaks to generally speaking the good part that we mentioned. they do go through the process of contracting, they're reflected in our financial system. and to the extent that there are others actually similar to the public works has, we actually did not go very deeply into into the others, for the very reason we wanted to focus on their operations. what we did ensure and hope it's taken that way, too. the recommendations that we put forth are actually not just limited to the department of public works. and that it's -- it should be that all city departments with, you know, similar structures of
a non-city organization should formalize their relationships, if they already have not yet already done so. so hopefully through that exercise of having the departments implement the recommendations, they would have some sort of a self-assessment that would happen, to make sure that each and every one of the non-city accounts and/or contracts that they have are actually -- are vetted and that has elements of transparency. >> supervisor mar: great. thank you. so, yeah it does seem to me that even the example of the public works director's abuse of the -- these friends of account, with the partl -- parks alliance aree most blatant example of abuse
and misconduct. that the recommendations are -- would cover -- do cover all these relationships and arrangements. so appreciate that. and for supervisor haney and peskin, that's the intent of the policy and legislation that they're working on, too. so thanks again for this presentation, all of your work. why don't we go to public comment on this item. mr. clerk, are there any callers on the line. >> clerk: thank you very much, mr. chair. operations is checking to see if we have callers in the queue. for those who already connected to the meeting via phone, please press star followed by three to be added to the queue if you wish to speak for this agenda item. for those on hold in the queue, please continue to wait until prompted to begin. you will hear a prompt and informs you your line has been unmuted. for those who are watching our
meeting on cable 26 or through sfgovtv.org, if you wish to speak on the item, please call in now by following the instructions, which should be displaying on the screen. that's by dialing (415)655-0001. enter today's meeting i.d., which is 146 704 2839. then press the pound symbol twice and then press star followed by 3 to enter the queue to speak. mr. can you please, -- coup, could you connect us to our callers. >> caller: hello. i've been following this item. and thank the controller's office for providing this study, the second of three. and maybe more to follow and for the supervisors already at work
to implement some of the recommendations. pay-to-play is something that needs to be discouraged. we have to keep integrity in our organizations, our individuals this is not something that happens. i can see the friends of city planning. you know, this is something -- it's just automatically happening. people make contributions. you know, they want things out of that. so let's please put controls and implement ways to keep -- to limit the things from happening. thank you. >> clerk: thank you very much. again, anastasia. the next caller, please. >> mr. chair, that completes the queue.
>> supervisor mar: thank you, operations. public comment is closed. so i guess again moving to close this hearing, thanks again. yeah, to the controller's office for all of your work on this. the second public integrity report. definitely there's more to come on this. and we have a lot -- much more work to do to address misconduct and corruption and fraud in our city government. thank you to supervisor haney and peskin for your work on the legislation, following up on the recommendations. and i look forward to -- i think continuing our hearings and the government audit and oversight committee, you know, on the different investigations. i note we'll be hearing from the city attorney's office at an upcomincoming meeting on their investigation into misconduct into city contractors and former
employees. and, yeah. so this is definitely going to continue to be a high priority for this committee moving ahead. so, supervisor -- colleagues, do you have any final comments before we close the hearing? all right. well, i would move that we continue this item to the call of the chair. >> clerk: on the motion offered by chair martha this hearing be continued to the call of the chair. member haney? >> supervisor haney: aye. >> clerk: haney aye. mr. char? >> supervisor mar: aye. >> clerk: there are three ayes. >> mr. clerk, can you call items 6 and 7 today for closed session. >> clerk: yes. agenda item 6 and 7 are two ordinances settling lawsuits filed against the city and county by federal insurance
companies, as subrogee of cct enterpriseses. and. members. public who wish to provide public comment on the litigation agenda should call the public comment number. it's still (415)655-0001. enter the meeting i.d. of 146 704 2839. press the pound symbol twice to connect to the meeting and press the star key followed by the number 3 to enter the queue to speak. the system prompt will indicate that you have raised your hand. please wait until the system indicates you have been unmuted and you may begin your comments. >> supervisor peskin. >> chair mar, if it pleases the chair, i have read the attorney-client privilege memoranda. and i personally don't need to
go into closed session. if you want, i would make a motion to approve these items, but if you want to go into closed session, i completely respect that. >> supervisor mar: no. i appreciate the comment and the motion, supervisor peskin. i was considering that, too. so i would support that. but why don't we go to public comment. are there any public comments? >> clerk: mr. coup, could you connect us to any callers that we may have for the litigation items. >> supervisors, i wanted to make a comment on the previous agenda item. i had -- >> clerk: i'm sorry. i'm sorry to say that the public comment period for agenda item number 5 has already closed. the committee is now hearing agenda items number 5 and 6, lit -- >> 6 and 7. >> clerk: 6 and 7.
>> i understand. i was hoping i might just be able to say a couple of words on item number 5. i had attempted to call in for that period and missed it slightly. >> clerk: i'm sorry to say. agenda item number 5 was continued to the call of the chair. it will be agendaized in the future and we welcome your comments at that time. mr. coup, do we have any callers for the litigation agenda? is there a caller on the line? mr. coup, could you connect us to the next caller? thank you very much.
mr. chair. mr. chair, we have completed public comment. >> supervisor mar: thank you. public comment is now closed. thank you, supervisor peskin, for making the motion to send items 6 and 7 to the full board with positive recommendation. mr. clerk, can you please call roll. >> clerk: on the motion that agenda items 6 and 7 be recommended to the board of supervisors, mr. peskin. >> a's. >> clerk: member haney. >> aye. >> clerk: chair mar. >> aye. >> clerk: mr. chair, there are three ayes. >> is there any further business? >> there is no further business before the committee. >> thank you. we are adjourned. bye. >> thank you.
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