Features

July/August 2012 The Power Broker

San Francisco’s ex-mayor Willie Brown has pioneered a new way to control a city without breaking a sweat—or running for office, or getting elected, or disclosing his clients, or making anyone particularly mad.

By Elizabeth Lesly Stevens

Meanwhile, Recology is making piles of money from its San Francisco monopoly; it made about $220 million in the fiscal year ending June 2010. A May 2011 report by the city budget analyst found that commercial garbage rates in San Francisco, which are unregulated, are far higher than those in other Bay Area communities. Recology’s contract guarantees it about a 9.5 percent profit over its costs of doing business, so the more costly its operations, the more profit it makes. And though Recology is a private company (technically an employee-owned stock corporation, a structure that enables it to avoid most corporate income taxes) and reports little financial information, a consultants’ analysis prepared in early 2010 reported that Recology’s pretax profit margin was well over twice the industry average.

Given Recology’s reliance on political protection afforded by its long relationship with Brown, it spends quite a bit of energy on political matters. Two months before the November election, a scandal arose over allegations that Recology employees violated campaign finance laws to help Ed Lee’s campaign. San Francisco District Attorney George Gascón declined to investigate, and the matter was soon forgotten. “Nothing ever happened,” says Kopp. “You aren’t going to get anything out of this DA. He’s part of this operation. How do you think he became DA?”

Gascón became DA when Gavin Newsom appointed him, in January 2011 (he was then serving as the city’s chief of police); the post had been vacated by Kamala Harris when she became the state’s attorney general. Running as an incumbent, Gascón was elected to a full term in the November 2011 election. The feds are also unlikely to take an interest in the allegations, given that Harris’s brother-in-law, Tony West, is third in command at the U.S. Department of Justice.

Kopp placed a measure on the June 2012 ballot to put the city’s garbage contract up for competitive bid, but even before the election he recognized that the effort was likely doomed. “Gail Kaufman [Brown’s former aide and current Recology board member] will spend $2 million to defeat it. We have zero. I’ve done my duty as a citizen” and put it on the ballot, Kopp says. Now, the “citizens of San Francisco have to assume some responsibility, too.” Kopp’s measure drew just 23 percent of the votes cast, and Recology’s monopoly remained secure.

Here, Kopp has hit on the real scandal afoot in San Francisco: all of this goes on, and most of the 800,000 people who call San Francisco home have little idea how their city actually runs. The city is in dire financial straits, and no one cares. But they love Da Mayor.

Put plainly, these tax breaks for politically connected tech companies or sweet deals for politically connected garbage haulers are not abstract curiosities. San Francisco desperately needs cash. As a financial entity, the city and county of San Francisco is in sorry shape. Tax revenues have been improving, but the city controller reported in March that the city, which has annual revenue of about $3 billion, faces a string of unbroken projected deficits until at least 2015, totaling $1.5 billion.

The root of the problem is the city’s huge payroll and benefit costs. The city and county of San Francisco has about 23,000 employees, while nearby San Jose, a larger city by population, has just 4,000. San Francisco’s mayor is paid $272,000 a year, considerably more than the mayor of far-larger Los Angeles. Until recently, anyone who had worked for the city for just five years was entitled to lifelong retiree health benefits.

Those ballooning employee costs were ominous enough that Lee acknowledged in the spring of 2011 that the city would be bankrupt in five to ten years if a way was not found to slash these costs by about $400 million a year. (Lee was given a new PR person shortly thereafter and spent the rest of the year denying the bankruptcy talk, even though he had been taped as he addressed a room full of reporters.) Lee and a group of public employee union officials and local business leaders did strike a deal to cut about a third of what Lee had said was required. Later, a much-needed change in the overly optimistic returns projected for the city’s pension fund essentially wiped out all of the annual savings of the pension-reform plan. (Lowering the anticipated return means that the city needs to contribute more each year to cover the fund’s anticipated obligations.) Lee trumpets his pension reform plan as the great achievement of his first year in office.

With employee costs out of control, and layoffs a verboten notion, the city has been forced to cut costs elsewhere. Summer school was axed in 2010. The city’s community college system—a behemoth with twelve campuses, 90,000 students, and a $200 million operating budget—has cut so many classes and is in such poor financial shape that its academic accreditation is at risk, the Chronicle reported in June. The streets are in deplorable condition, and Lee pushed through a $248 million bond measure last year to pay for maintenance that better-run cities fund out of annual routine operating budgets. Lee also saved a few million dollars by decreeing last year that the burden and legal responsibility of caring for thousands of street trees the city planted in the Newsom era would now fall on the property owner living nearest the tree. If a property owner—perhaps disabled or too elderly to prune the city’s former tree—is an inadequate arborist, the city will levy a fine.

So San Francisco serves its average citizens less well each passing year, and no one seems to mind—about that, or about the fact that the city is run to an unknown degree by a former mayor who openly holds sway in the public sphere yet answers to no one. “There is no way to hold Willie Brown accountable. He doesn’t serve in any capacity. That’s why machines are worrisome,” says Jessica Trounstine, a political science professor specializing in city government at University of California, Merced.

Trounstine, who says she studies historical political machines because no one will talk about a machine currently in power, says that the lack of popular interest or concern is to be expected. The local newspapers in San Francisco are a particularly listless bunch, and the dominant Chronicle can hardly be expected to look too critically at the day job of its star columnist. “It takes a lot for people to become outraged in local politics,” says Trounstine, noting that it commonly takes fifteen or twenty years for a city’s voters to grow disenchanted enough
with a political machine or boss to vote it or him out of power.

Elizabeth Lesly Stevens wrote a weekly column on money and power for the Bay Area section of the New York Times before moving to Washington last fall.

Comments

  • working stiff on July 11, 2012 5:48 PM:

    leaving aside the substance of the rest of the article, the reporter is mistaken in linking the cuts at the SFUSD and at City College to the rest of San Francisco's fiscal condition. Both are independent agencies with their own elected boards and budgets distinct from the City and County of San Francisco. They are also agencies have seen millions of dollars in cuts resulting from California's pervasive fiscal crisis and the inability of the legislature to raise taxes through a simple majority.

  • San Franciscan on July 11, 2012 7:39 PM:

    Stevens' shows the same hostile ignorance and barbed navet that she demonstrated back when she wrote her glorified blog in the Bay Citizen -- but it's disappointing that Washington Monthly, supposedly steeped in the art and mechanics of politics, would miss it.

    Take one very telling example: to justify her extended attack on San Francisco as a poorly run city, she compares it to "nearby San Jose, a larger city by population," which employs only 4,000 workers. She suggests San Francisco's 23,000 is bloated by comparison and must be the result of a corrupt, self-dealing "machine." What she fails to tell her readers is that San Jose is merely a city, while San Francisco is a city AND a county, which means all the county obligations (hospitals, jails, courts, etc.) fall to San Francisco, in addition to all traditional city services. Moreover, San Francisco runs the busiest airport in Northern California, owns and operates a vast regional water and power system (which supplies 30 other cities), and carries more passengers on its public transit system every day than all the Bay Area's other transit agencies -- combined. And oh yeah -- as the employment hub for the region, its population doubles in size everyday.

  • Armand Der-Hacobian on July 12, 2012 12:04 AM:

    Excellent article by an excellent journalist.

    I love San Francisco and have lived in the City since 1983. I do want to do my part so that generations to come get to enjoy this magical city as much as I did.

    The issues that Mrs Stevens are the root cause of all of San Francisco problems.

    Well done Mrs. Stevens. Please keep up the good work.

    Armand Der-Hacobian

  • Anniecat45 on July 12, 2012 11:30 AM:

    I've lived in San Francisco since 1980 and Ms. Stevens has omitted to mention a few things:

    1. The overhaul of the City Hall had been planned for several years before Brown became mayor and was due in part to the 1989 earthquake and in part to a need to re-wire a building that was constructed in the early 20th century.
    2. Quentin Kopp is a professional kvetch and has been for his entire public career. He also HATES Willie Brown to such a degree that when it rains around here, Kopp blames Brown for the water being wet. (Slight exaggeration, but only slight.)
    3. To say City layoffs are verboten may not be a lie but it certainly given the reader the wrong impression. There have been a LOT of furloughs and empty city jobs are not being filled.
    4. Tax breaks for busines? Yeah, Brown invented those all right. And the mid-Market area that Twitter has moved into has been blighted for years and nobody -- including Mr. Kopp -- could think of any way to fix that.
    5. Has Ms. Stevens spent any time at all in Chinatown where the Central Subway will run? The traffic congestion is HORRIBLE there -- narrow streets, packed with lots of cars, delivery trucks for the businesses, buses and pedestrians. It's already served by three bus lines; the problem isn't lack of buses, it's the amount of vehicles sharing the streets. The Central will get some of this traffic off the street and will take people, upon final completion, to another part of the city where many Chinese residents have bought homes when they've been able to leave Chinatown.

  • Ellen Greenberg on July 12, 2012 3:36 PM:

    Kudos to Ms. Stevens for telling it like it is. Willie Brown, the grand puppeteer, pulls the strings of our city politicians like no one else. Yes, SF is both a city and county, so the comparison to San Jose is apples and oranges, but the Recology and Twitter breaks cause real harm to city residents. The Central Subway project is not about transportation or conneecting Chinese residents to other parts of the city; it's about real estate values. Ironically, poor residents in Chinatown will be forced to leave as the subway corridor becomes so valuable that Willie's development cronies start building market-rate high density condos and office buildings there.

  • CJRoses on July 12, 2012 5:19 PM:

    Ms. Stevens captures the essence of SF government - a body whose primary function is to enrich its employees and secondarily to provide services. Yes, Ed Lee was in charge of fixing potholes before he became Mayor.

    Yes, San Jose is not an apt comparison but Philadelphia is and by comparison, SF wastes staggering amounts of taxpayer money and delivers little- see Muni and potholes.

    City employees will get last laugh with bloated pensions - if there is still any money left...

  • SanFranciscan on July 12, 2012 6:09 PM:

    He may have had an illegitimate child with an aide but that shouldn't be a scandal anywhere. He and his wife are still married, sure, but they've been separated since 1976.

  • Hank Plante on July 12, 2012 6:28 PM:

    Another East Coast magazine swoops into the West Coast to tell us nothing we didn't already know.
    To capture the essence of Willie Brown you have to understand what those of us who have reported on him for 30 years understand: that he is the best daily news story you can find. On a dull news day all we had to do was find Willie, get a soundbite, and we'd have a story.
    He is surprisingly transparent (for someone who sees the whole chess board), and he likes nothing more than to share his tidbits and info with reporters who get him -- which is why he's good copy.
    I won't nitpick, but you should know the reason S.F. has more employees than San Jose is S.F. is a city and a county (San Jose is not). Also, it's "Gale" Kaufman.
    Keep studying us though, and you may actually break some news.

  • mfw13 on July 13, 2012 3:31 AM:

    What the author fails to note is that Da Mayor, despite all his power, has done nothing to actually solve the problems San Francisco faces.

    Compared to when I grew up in San Francisco in the 70s and 80s, virtually everything is worse now than it was then....MUNI, street reapirs, the homeless problem, the public school system, etc.

    About the only people who like Da Mayor are businessmen and those with political ambitions, i.e. those who need favors from him. Most ordinary San Franciscans loathe him with a passion....

  • Hope Johnson on July 13, 2012 4:35 AM:

    How unfortunate that this article attributes Willie Brown's lifetime of theft of taxpayer dollars and erosion of the middle class to some supposed superior intelligence. Brown's greatest strength is not playing "the political system" but playing up human greed.

    His so-called "charming" official misconduct behavior is not possible because he is open about it, it remains unchallenged and uninvestigated because so many people believe there's a chance they will become wealthy or more powerful if they become a part of his inner circle. Brown unabashedly uses that greed like a carrot on a stick and most everyone goes along to whatever degree they long to gain another step up the socio-economic ladder. They prefer to believe any reporting that makes them feel better about this behavior, thus the lack of interest in the Chron's poor reporting.

    Brown recently demonstrated his skill at playing human greed when he participated in the fundraiser for Christina Olague, the Lee appointee that this article says makes Lee a rogue Brown creation. There was Brown front and center at the Rose Pak event for Olague, knowing that the appointed supervisor would willingly toss aside her progressive values for a one night stand with Brown with her pocket book wide open.

    When people finally realize they would have more if they got rid of the money-sucking Brown/Burton social network, only then will SF be able to save itself from the downward spiral.

  • Robert Weiler on July 13, 2012 6:39 PM:

    Ms. Stevens should have noted that Quentin Kopp's ballot initiative was also supported by big waste management companies that hoped to displace Recology and would have created 5 different 'garbage districts' in a city that she notes, is smaller by population that San Jose. The proposal lost not because of Willie Brown but because residents don't find Recologies fees excessive and they do a good job. In the time that I have been in the city, there have been no strikes and the job is performed quietly and efficiently. Is it possible that the voters aren't stupid after all and are getting better than average service for their money?

  • Rick Claymore on July 13, 2012 9:24 PM:

    Hank, maybe it is news in Washington.

  • PeonInChief on July 16, 2012 1:51 PM:

    It should be noted that San Francisco is both a city and county, unlike San Jose, and therefore has the responsibilities of both. Comparing the labor forces of the two is therefore apples and oranges.

    Willie Brown is a very smart man, and he knows how to sell out to the elite. In our present society, however, any idiot can do that. What can be said, though, is that if you are part of the 99%, you should deal with Brown as though he is the United States and you are Ricardo Alarcon--most of the time there's nothing on offer.

  • Shokai on July 22, 2012 10:03 AM:

    I'm sure Willie is great with women: http://youtu.be/kogUBtaf_-U

  • Walter Lee on July 29, 2012 8:21 PM:

    The subway station in Washington dC did make Chinatown real estatemore expensive and eventually most of the poorer resident with the exception of the wah luck apartment building residents had to leave. It's a boom to the wealthy land speculators/owners/developer though.

  • Robert B. Livingston on August 03, 2012 12:29 PM:

    I enjoyed your description of Ed Lee's inauguration as much as former Chronicle journalist Robert Morris's description of Newsom's inauguration: when a rare crowd of the city elite gathered in front of city hall.

    Such joys for the ruling class! It is as if it were all a jolly game.

    I hope in part two, if it comes, you take a hard look at the so-called progressive "opposition" whose identity politics lock them into becoming natural allies of Brown and the downtown business interests.

    While they clamor for medical marijuana, marriage equality, Dream Acts, among other secular causes with built-in fine print-- the status quo runs rings around them: asking regular folks and their children to endure and sacrifice more-- even as wars expand, constitutional rights are expended, and a police state is constructed.

    Almost a quarter of kids are in desperate poverty, and San Francisco's current "homeless czar" (a title created to placate Angela Alioto who had wanted to be made vice mayor) wants to pay poor people to babysit pound puppies.

    So jolly!

  • Kim on August 10, 2012 5:58 PM:

    Chinatown will suffer the most. See Washington DC Chinatown that has turned into corporate shops since the subway came.

    This is the death knell for the Italian community in North Beach as well.

  • ed on August 20, 2012 4:12 AM:

    Willie Brown, Jr. is the perfect example of a man who sold his soul to the Devil to get where is at. This son of a sharecropper, who didn't know what a "smoothie" was when he was at a cafe, learned the art of political manipulation and loopholing as a numbers runner for his uncle's Fillmore District, SF gambling room in the 1950s while a SF State student, thus learning the art of the backroom deal. It is the Romneys of the GOP who compare CA to Europe and how dysfunctional it is due to Demos like Willie. The previous mayors in Adolph Sutro, George Christopher, and Joe Alioto helped shaped SF as the City that Use to Know How. Willie's legacy will be that he needed to be the arrogant front center of attention from being SF "Grand Dame Ego Mayor" and Sacramento Assembly "Poohbah Speaker". It is no wonder he is loathed by many in CA politics and outside of it.

  • Dr.KarlaGottschalk on July 04, 2013 9:44 PM:

    I have filed a federal corruption RICO case against Mayor Wille Brown, who is as corrupt as any politician in the world, and I have made a California bar complaint against him as I am a myself a member of the Bar of the State of California.