Labor Union Sues City for Corruption and Retaliation

by Dr. Derek Kerr : westsideobserver – excerpt

Why does the FBI manage to unearth City Hall corruption, while our watchdog agencies; the Controller’s Whistleblower Program, Ethics Commission and City Attorney’s Office cry “What happened?”

Clues emerge from a whistleblower retaliation lawsuit filed in Superior Court on behalf of the Laborers’ International Union, Local 261 (Case No. CGC-21-596956). The central claim is that the Public Utilities Commission (SFPUC), Department of Public Works (DPW) and the City Administrator’s Office had “engaged in a multi-year process to divert public funds and resources to enrich themselves and friends and family…”  And, City Hall knew about it…

The impression conveyed was that the City Family views reports of corruption as nonsense to be ignored – or threats to be obliterated. That may explain why Local 261 notified the FBI and decided to sue…

Colliding Ideologies – Prelude to Lawsuit

Local 261, represents some 1,000 City workers. Most toil in construction, environmental services and other public jobs involving manual labor. Committed to workforce development and apprenticeship training, Local 261’s partnerships with the City have been contentious. For example, the union withdrew from a 2004 joint project with DPW. After co-creating lower-wage job classes to boost employment for unskilled workers, “the Department of Public Works took over the funds…to fill other positions that did not promote workplace development,” per the lawsuit…

The Union contends that former DPW Director Mohammed Nuru, and former SFPUC Assistant General Manager Juliet Ellis, hired cronies to “facilitate the flow of public funds to outside non-profit agencies.” Further, these favored nonprofits were paid to perform the same duties as City employees represented by Local 261. Nonprofit workforce development projects sometimes side-stepped the training standards used in union-run programs, thereby compromising workplace safety, quality standards, and career ladders, per Local 261…

Local 261 also chafed at the way SFPUC managed its Community Benefits Program, calling it “nothing more than a slush fund.” SFPUC contractors who pledged to donate money, equipment or volunteer hours to local non-profits received extra points for their proposals. However, the lawsuit alleges; “In many cases, contractors are advised by insiders at the SFPUC to hire an outside ‘consultant’ who will advise them how to draft the… proposal to ensure the SFPUC staff would accept the bid…These consultants in turn received their direction from SFPUC staff.” …

At first glance, this dispute looks like a turf battle: Union versus City-funded nonprofits. But the documented sleaze permeating the DPW and SFPUC leadership adds credence to this lawsuit’s claims. Following its “limited hang-out” audit of SFPUC’s Community Benefits Program, the Controller’s Office intends to audit SFPUC’s overall contracting practices by April 2022. Detecting corruption is unlikely. That would fuel Local 261’s lawsuit. Fortunately for Local 261, the California Supreme Court recently decided to relax the standard for proving whistleblower retaliation. The Westside Observer awaits the City’s response to the above-noted allegations.

Dr. Derek Kerr is a San Francisco investigative reporter for the Westside Observer Contact: watchdogs@westsideobserver.com(more)

Now we know where some of that consultant money is going. Has anybody calculated what percentage of the city budget goes to consultants and how it is accounted for in each department? How long term and open-ended are these consultant contracts?

Top SF Public Works Official Retires Amid $100 Million Overcharging Scandal

Julia Dawson, the chief financial officer at the San Francisco Department of Public Works, retired Friday amid the still ongoing investigation into what city officials knew about $100 million in overcharges by the Recology garbage hauling firm…

Dawson spent 24 years working for the city, seven and a half years of them at Public Works, as well as earlier stints at the airport, fire department, municipal transportation agency and the department of parking and traffic…

In March, City Attorney Dennis Herrera announced a $100 million settlement with Recology over customer overbilling. The company says was due to an error in how it accounted for its revenues…

After Porter acknowledged at the meeting in December 2018 that the company had indeed been undercounting revenue, Dawson enlisted an outside consultant to study the issue in 2019, records show. However, record shows Dawson failed to alert the public -even after that outside consultant confirmed the overbilling in early 2020.

Gordon said while the city’s probes continue, “we see no criminal wrongdoing in the investigations so far involving Julia Dawson.”…(more)

Former SF official agrees to plea deal, will cooperate with FBI in corruption investigation

By Andre Torrez : ktvu – excerpt

A former San Francisco aide to Mayor London Breed has agreed to plead guilty to conspiracy to commit money laundering and will cooperate with the FBI in their ongoing corruption investigation of San Francisco City Hall…

Federal officials made the announcement on Tuesday regarding the former Mayor’s Office of Neighborhood Services Director, Sandra Zuniga…

“This investigation continues, but the window of time for cooperation is closing.  If you are involved in public corruption at any level, reach out to the FBI before the FBI reaches out to you. Early cooperation is always viewed favorably.”…(more)

City suspends contractors involved in ongoing corruption scandal

By Michael Barba : sfexaminer – excerpt

San Francisco is suspending five individuals charged in the City Hall corruption scandal and their companies from receiving contracts under a new local law aimed at keeping government clean.

The defendants, Nick Bovis, Alan Varela, William Gilmartin, Florence Kong and Walter Wong, are the first to be temporarily barred from doing city business under the newly implemented legislation that allows local officials to block contractors from engaging in city business while their criminal cases are pending or while the debarment process against them is underway…(more)

U.S. attorney hits SFPUC with subpoena as SF City Hall corruption investigation widens

By Dominic Fracassa : sfchronicle – excerpt

Federal officials served the San Francisco Public Utilities Commission with a sweeping subpoena last month, demanding numerous records and documents that appear to draw the agency into the widening City Hall corruption scandal touched off by the arrest of former Public Works Director Mohammed Nuru in January.

The U.S. Attorney’s Office issued the subpoena on June 15, according to a copy obtained by The Chronicle on Friday.

The subpoena suggests that federal investigators are interested in examining contracts the commission awarded to several companies, some of which have previously been linked to alleged schemes traced back to Nuru in investigations by the FBI and the City Attorney’s Office…

The federal subpoena specifically demands all communications “related to any LED light installation contracts” between commission employees and Walter Wong, Washington Wong, the relative with the business registration, and their affiliated companies. The City Attorney’s Office previously filed a subpoena directly to Alternate Choice in February…

They also ordered the agency to produce any commission audits from 2010 to the present related to trips taken by Kelly and Ellis…

Kelly’s wife is City Administrator Naomi Kelly, Nuru’s former boss…(more)

This is getting to be a rather extensive list of City Hall power players. Who will turn up next in the net?