tv BOS Govt Audits and Oversight Committee SFGTV April 15, 2021 10:00am-1:01pm PDT
>> mr. chair, are you there? >> chairman: good morning. this meeting will come to order. welcome to the april 15 isth, 2021, regular meeting of the government audits and oversight committee of the san francisco board of supervisors. i am supervisor dean preston, and joined by connie chan and raphael mandelman mand. .and thank you to sfgov tv for staffing this meeting. mr. clerk, do you have any announcements? >> clerk: in order to protect the members, the board of supervisors legislative chamber and committee room are closed.
it is pursuant to all local, state declarations. members will participate in the meeting to the same extent as if they were in the committee room. public comment will be available on sfgovtv and channel 26 are streaming. you can dial 415-655-0001, i.d. 18759777161. following that, press ## to be connected to the meeting. when you're connected, you will hear the meeting discussions, but your line will be muted. when your item of interest comes up, dial *3 to be added to the speaker line. assistant prompts will indicate you have raised
your hand. please wait until the system has indicated you have been unmuted and you can begin your comments. best practices are to call from a quiet location, to speak clearly and slowly, and to turn down your television, radio, or streaming device. everyone must account for time delays between the live coverage and the streaming. alternatively, you may e-mail me, and my e-mail .[inaudible] or you can send your written comments to our office in city hall. our office is in room 244, and city hall's address is 1 carlton place, san francisco, california,
94102. and items acted upon today will appear on the board agenda of april 27th, 2021, unless otherwise posted. >> chairman: thank you, mr. clerk. please call the first item. >> clerk: agenda one is a hearing on the most recent whistle-blower report from the office of the city controller, and to review the status of the city's whistle-blower program. members of the public who wish to provide public comment should call 415-655-0001. and then enter the meeting mr. chair?>> chairman: thank yo, mr. clerk. and i requested this hearing today on the most recent whistle-blower report, and i'm very much looking forward to getting the update on this. i think this is one of the
most crucial programs that we have in the city to uncover corruption and improper conduct by city employees and officials early in the process. and i'm very much interested in these updates on the report on the program, as well as looking at ways we can proactively make sure we are protecting whistle-blowers and incentivizing folks to come forward. i'm going to, in a moment, turn it over to mr. dela rosa from the controller's office, and i just want at the outset thank them for all of the work that they do on the whistle-blower program and on these quarterly reports. mr. dela rosa? >> thank you very much,
supervisions. good morning chair preston, vice chair chan, and supervisor mandelman. i'm mark dela rosa acting director of audits for the controller's office. i'm joined by dave jensen, our lead manager for the whistle-blower program, and also with us is steven munoz, who will be assisting with navigating our slides today, and together we'll be presenting to you some highlights and initiatives to date, using quarter two whistle-blower update report, which we issued about a month ago on march 15th, as a basis for providing you with new information. >> as a quick background, our whistle-blower office is contained in the office of the controller. it serves as the city's chief finance officer, or
accountinging officer. the city services auditor has been tasked with carrying out the audit function for the controller's office, including risk based audits, and general standards, as well as administering our city's whistle-blower program, with the goal of investigating complaints or received on our whistle-blower hot line of fraud, waste, and abuse of city resources. on that slide three, it really provides an overview of the authority that we have at the controller's whistle-blower program in carrying out function. and really the three primary state and local requirements that we have in relation to our program are, first, the california state code, section 53087.6, which empowers city and county auditor controller functions to maintain a whistle-blower
program, to receive information regarding fraud, waste, and abuse. our second authority is our very own charter, appendix "x," regarding the quality and delivery of services, wasteful and inefficient practices, by city government officers and employees. the third authority that we have is article 4 of the san francisco campaign and government code, which directs the controller to administer and publicize a whistle-blower and estate citizn complaint program. just to highlight some of the key matters that are really appropriate for our own whistle-blower program investigation listing here are the misuse of city funds, the complaints or reports related to misuse of funds, which really speak to -- or some examples would be the
improper expense and reimbursements to employees, allegations of non-profit use of public funds and the like. the second types of matter we investigate are those involving improper activities by city officers and employees. and some of the examples really are allegations of abuse of city time, such as significant and unauthorized time away, improper usage of city resources, like city e-mail or city vehicles. the third type of matter that we typically investigate are those involving deficiencies and the quality and delivery of government services, an example of which are the non-performance of contractually services. and then the last is those related to inefficient and government practices. some examples are allegations of purchasing
unnecessary supplies or equipment for city functions. on the slide five, it's really just highlighting that although the whistle-blower program is a primary entity that intakes and investigates administrative complaints, there are those we receive that we have to refer to other departments in the city, given that it is within their own jurisdiction and outside of the adjudication of our whistle-blower program. some of those says examples are reports in which another city department
>> established by bargaining unit or contract. so per the charter, if a reporter has remedies available to them that are addressed in any union contract or bargaining agreement, then we have to refer those to the respective department for review. we also refer those that are involving violations or criminal law which we obviously refer to the district attorney's office. and any reports we receive subject to existing investigation, we have to refer those to the departments in that we do not want to duplicate any efforts or jeopardize any existing or open investigations. and then the last category of our referrals are really those involving ethics flaws, which we
refer to the ethics commission. i just wanted to emphasize that as part of our normal process, we do kind of a triage process which on a regular basis we do meet with these entities to make sure we do have proper coverage and adjudication for all of the whistle-blower complaints that we receive, essentially. just very quickly, as required by appendix "f" of the city charter, the whistle-blower program is required to publicize and report our activities and functions, and some of the ways that we do meet this requirement is by generating quarterly and annual reports, by publishing five bulletins that provide us with an opportunity to provide departments with red flags for anything that they have to pay attention to, just so there is familiarity citywide in terms of what could go wrong. we also host a national
webinar series in which we help promote leading fraud hotline operational practices. the last one that we did was actually in january of this year, 2021, in which we had a webinar that was about affective communication and fraud investigation, in which over 120 attendees from 49 jurisdictions throughout the country participated in. we also have our departmental liaison program, and we have a whistle-blower program for each and every department throughout the city. this is really just an opportunity for us, being the central function, to promote our program, as well as provide any training and tips to those that are involved in investigations in their own departments. the seventh slide just highlights really the disclosure laws that are related to the whistle-blower program. basically all investigative records are
confidential and exempt from disclosure under any one of these following laws and regulations. and, really, the bottom line here is that such provisions bar us from disclosing anything that would compromise the confidentiality of the whistle-blower reporter identity, which we take very seriously. the bottom line is that those who contact the whistle-blower program do have the right to privacy under state and city law, that we respect and protect. and i just wanted to highlight a couple of sections in our campaign government code that pertain to this disclosure. back in 2008, there was an amendment that was enacted to protect the confidentiality of whistle-blowers. the investigation of complaints and provide reporters protection from retaliation. and 2008, it codified the confidentiality requirement that we now so hold to this date.
and more recently, in 2018, there was an amendment to the campaign, government code section 4 -- article 4 section 4.120, which provided protections for whistle-blowers, as well as establish retaliation protections for city contractors and other greater protections for the whistle-blower's identity. with that background, let me turn it over to dave jensen, our whistle-blower program manager to provide you with some activities to date. >> good morning, chair preston and vice chair chan and supervisor mandelman. thank you for this opportunity to speak with you today about the whistle-blower's program quarterly report for the second quarter of fiscal year 2021. the first slide that be are sharing with you today just gives you some background about the volume of reports that we have received since
july 1st, 2012. you'll notice that we've got an increasing number of reports filed year after year. and after a short dip in the number of reports received in 2/4 of last year, we are back on track and seeing the same volume of reports that we had seen pre-covid. so i would also let you know that as of the close of q-3, on the 31st of march, we had received 186 complaints in q-3. we're verifying that information as we go through our quality assurance procedures. next slide, please. the next slide details fiscal year 2021, report volume through the end of december. as of june 30th, when we closed out fiscal year
1920, we received 291complaints, and to close out 230 for an open volume of 66 complaints as of december 31st. as of march 31st, when we closed out q-3, we had 64 open cases, and as of 8:00 this morning, we had 68 open cases, just to give you a sense of the volume of what we're doing and what we experience. next slide. slide 10 deals with the form in which we receive complaints from the public. most everything that we're getting recently is online. prior to the onset of covid, we were able to also take walk-in complaints. we obviously aren't able to do that now, so we're seeing an uptake in the number of complaints filed online and via mail. and we are also able to take complaints via e-mail
and the phone, and we even have a dusty old fax machine at city hall where we would occasionally get complaints. but another aspect of this slide is that the majority of our reports are being filed anonymously. mark spoke briefly earlier about the seriousness with which we guard our reporter's identity. when they come in anonymously, we obviously can speak to who files those complaints. but everybody should no, and please do know, if you wish to file a whistle-blower complaint, we will take that very seriously and protect 100% to the extent we're able to do so. next slide, please. next slide details how we're able to close out our cases. our goal is to close out 75% within 90 days. we were able to hit that mark in q-2, but this
gives you some information about the number of complaints that were able to close quickly. and some are more complicated, and some take longer than a year. that is just the nature of the complaints we get. this can be something as serious as corruption at the highest levels of government, or something as seemingly minor as a bad customer service interaction. so we take the gamut, and sometimes we're able to close them quicker; sometimes the more serious contain more allegations and take longer for us to work through. next slide, please. slide 12 details how we dispose of some of these reports. as the first point of intake for most of complaints about government services, as they are being delivered in san francisco, we
triage any number of complaints. some of them are within our jurisdiction, and some are not. some of them are complaints that we have looked at previously, and so we will merge them with the existing complaint. other complaints are appropriately referred to the department with charter jurisdiction. mark spoke briefly about that. sometimes it alleges criminal behavior, and that leads to the d.a.'s office. sometimes alleges deficiencies in the hiring process, and that would have to go to d.h. r.or d.h.r. r the civil service commission. that is appropriate given our limitations under the charter. some of just completely outside of the whistle-blower program. some complaints we get that just don't have enough information for us to be able to do anything with. and so those would be the
circumstances under which we would close out a complaint without investigation. moving on to slide 13, slide 13 speaks to the disposition that we closed reports over the last several fiscal years. again, a lot of it is remarkably consistent, even given the fluctuations in the number of complaints that we have been receiving. and so we typically investigate just over 50% of what we receive. we refer to the department with charter jurisdiction, from 11% to 21% of the time. some of them remain outside of jurisdiction, and some we just don't have enough information to be able to investigate. next slide. this slide speaks to the percentage of reports we
investigate that result in any sort of corrective or preventive action. corrective action would be considered any sort of discipline against a city employee. preventive action might be a change to a policy, where a complaint results in a finding that city policy is deficient or doesn't cover what it needs to cover, and, therefore, a change of policy is warranted and results as a part of this investigation process. what is interesting to me, from a practitioner's point of view, is we remain fairly consistent in the percentage of complaints that result in this corrective or disciplinary or policy change action, even with the variance of the complaints we're getting, we stayed in the 30% to 40% band which resulted in any sort of corrective action, whether it is policy or an incident with
an employee. slide 15, please. this is just to give you a little bit of information about the public integrity tip line that was established after muhammad newer's indictment late last year. we received 56 tips in '19/'20, over that timeframe. with the tips, there can be any number of dispositions. some get referred out to the city attorney's office for an investigation that may already be under way. some go to the d.a.'s office because they involve criminal behavior or allegations of criminal behavior. and others have been referred both to the ethics commission and the
office of standards and enforcement. that last row involves complaints we received within the last probably six weeks or so, where we are working with our partners at the city attorney's office to determine the best way to process them. and we've already gotten through several of those, and we are working with them to make sure that any tips that come through, the public integrity line gets to the appropriate agency for investigation. slide 16 involves some of our fiscal year '20/'21 initiatives. i spoke to our desire to close 75% of the cases within 90 days. we continue to issue our quarterly reports on a quarterly basis. the last one was issued may 14th for q-2, and we're currently in the
process of putting together our q-3 report, and we hope to have that within the next couple of months for you. and we started to put together a whistle-blower program that people up and down the state, and throughout the country, can look to as an example of how to do this type of work. in doing so, we instituted a new case management system in the last six weeks, which will allow us to report out a more robust findings and outcomes. our previous system did not allow us to report out multiple outcomes. so if we had a situation where an employee was disciplined, but there were also policy changes as a result, we could not report that out. the new system will allow us to do that. and so with that new system in place, the information we'll be able to report out will be much more accurate and much more comprehensive.
additionally, we depend on our department liaison to promote our investigations for us on certain occasions. we have trained them on a yearly basis. the last training was on november 10th. the specific focus on that training on november 10th was about remote investigations and how to do that, now that we're all in this covid environment. we continue to learn and provide information to our peer jurisdictions. we provided copies of our policies and procedures to san diego and to oakland port commission, for them to be able to bench more their own policy and procedures. and mark spoke about this earlier, but we do host national webinars with fraud hotline practices and affective investigation techniques. our last webinar was in january. our next webinar will be
may 11th, on the topic of how to preserve evidence that you find for review for -- for referral and review by criminal authorities. so we continue to hold ourselves out as an example and as somebody to go to for information about how to conduct these types of investigations. slide 17 -- excuse me -- is any number of the ways by which we can intake a complaint. most of our business comes through the whistle-blower web page at sfgov.org, and we take complaints via 3-1-1. we will take any complaints to the e-mail address, whistle-blower sfgov.org. and our website also
allows reporters to track the progress of their cases using a unique tracking number that is unique to their complaint. and our final slide -- any questions or comments we're happy to take and we'll be happy to answer any questions you have. our contact information is posted. and we're available to you any time you might have a question. with that, i will conclude and be happen to answer any questions that you may have. >> chairman: thank you, mr. jensen and mr. dela rosa for all of your work and for that thorough presentation. i do have some questions, and my colleagues may as well. the first question i have is just around the category rising of the categorizing of complaints. specifically with respect
to corruption-related complaints, they're not really broken out. you lay out at the end of the report, without the names of the complainant, the different types of descriptions. it is quite a range. everything from someone failing to follow covid safety protocols, for example, or someone falsifying a time sheet, and then other cases of things like a direct kickback allegation for contracting and things like that. and so i'm just curious if you -- if internally you do track, when you're doing these quarterly reports, by category the type of complaint? >> mark, do you want me to take that? >> start and i'll follow. >> sure. we currently have four categories of complaints that we try to bucket everything into. they can include misuse of
city funds, fraudulent expenses, things like that, inefficient or deficient provision of government services, but we don't have a bucket for corruption. and i think we'd be definitely interested in exploring with you further if that is something you would like broken out. we had this back and forth, prior to this meeting, and a lot of what we receive -- or most of what we receive could be considered corruption. whether or not it is an allegation that somebody is shaving off 15minutes or 20 minutes here and there, that is a corrupt practice. whether or not the corruption involves somebody in a position of power to be able to make funding decisions or allocate resources one way or another, because it is going to come back to them, that's another type of corruption.
and so i think we would be open to having a discussion about what would be considered corruption, aside from, you know, a bus cleaner shaving off 15 minutes of their time every day, versus a department head taking money to steer a contract one way or the other. arguably, they are both corruption, but there is a degradation, and i would appreciate an ongoing discussion with you all about that. >> quickly to add to that, a lot of the categories that we have been using to track the various types of cases or reports that we receive are really consistent with our appendix as buckets of categories, as well as there is a local campaign and government conduct code. that is not to say there are facets of those
buckets of categories that do not make up for, as dave mentioned, a corrupt situation. so we definitely -- we do not -- basically, we do not call it out as its own category. however, the subcategories that we do track are kind of like a manifestation to various subcategories of what corruption could potentially look like. >> chairman: thank you. and i think -- it sounds like you track the four categories. it might be helpful -- and maybe i missed it in the report, but i think looking at not just the aggregate of this many complaints and the results, but some breakdown, even by the four categories that you mentioned, which it sounds like you're tracking already, and we can talk further about whether there is any specific corruption-related types of complaints to track. but i think even just breaking it out, as you're saying, with the four categories that you already track, would be helpful so we can see if
there are trends. and you may already be doing that internally. the next question i had was just curious what you attribute the increase -- mr. jensen, you noted the annual increase over time pretty consistently in the number of whistle-blower complaints. so i'm -- what do you attribute that to? >> i don't know that we would pin it on any one factor. i think there are a number of factors that have resulted in an increase in the number of complaints that we've been receiving over the years. i think one component to that would be an increasing awareness of the whistle-blower program. within the last administration in washington, i think whistle-blowers got a little more attention, and so that would be one component of a national awareness of these types
of programs that has driven traffic to us. i think that locally very specific stories about department heads being indicted has increased the awareness of these types of programs, and your ability to report information about them. for example, after the muhammad newer indictment, we received an increasing number of complaints. and i think it was slide seven or eight -- it might be slide eight -- where in the q-3, we had 188 complaints in the last fiscal year, and that was right when that would have been january, february, march of 2020. and i remember getting complaints where the reporters had information such as "i've sat on this for years but now finally feel i have a voice or means to communicate something that has been crawing at me for a
while." i think there can be both national and local factors of what is happening in the news that may drive our number of complaints up. i think that we are trying to do the best job we can to get information about this program out there to city employees. and including a new management training for san francisco managers about what their requirements are about reporting whistle-blower complaints, and what happens when an employee comes to you with a complaint, what are you required to do? so i think the national awareness and local awareness, plus that we're putting out that this is a resource available to you, and that you do have a duty to report when you see something -- i think they're all factors, but i won't pin it on any single one of them for the
increase. >> chairman: thank you. one thing i noticed is that the increase in the number of cases didn't really change the percentage where they resulted in corrective or preventive action. in other words, there could be a concern with rising complaints, that it caused people to file complaints that weren't meritorious, or something like that. that doesn't seem to be the case. unless i'm misinterpreting it, it seems like the different drivers you're talking about have led to an increase in the number of cases, and then the percent of those that result in some kind of corrective or preventive action has been relatively consistent, even with that increase, unless i'm reading that wrong. >> no. i would agree with your
assessment that way. i think that is one of the things that we noticed, as we're taking a look retrospectively back at our history, is that it remains fairly consistent, even given the increase in volume. the numbers of how we receive complaints remain fairly consistent. our ability to take in complaints or refer them out has been fairly constant, despite the increasing numbers over the past years. and so i -- if -- the numbers are what they are, and they have remained fairly consistent, including, you know, complaints we've investigated that resulted in any sort of correct testify or preventive action. >> chairman: thank you. i've got a couple more questions, but i also see my colleagues do, as well, so i'll try to keep it
short here. just for the ones that you noted that get referred to other departments, obviously those still appear in the whistle-blower complaint file numbers, and we still capture those. but i'm curious whether the outcomes include, or do not include, those. for example, if a complaint is filed, you refer it to d.h.r., or the city attorney, and a policy is changed as a result of that, will that show up in the numbers that you are presenting us in the quarterly report, in terms of the corrective action, or once you refer it, is the disposition no longer tracked by the whistle-blower program? >> i would make the distinction that there are two types of referrals that we do. there are the charter referrals that mark spoke
to earlier. once we get a matter that we have to refer, to the district attorney, for example, we'll close that complaint out because we put it to the right agency, and the agency with charter jurisdiction will have it. occasionally we will hear back from those departments with a result. occasionally the way we hear back is a press release that somebody has been charged with a crime. so those are the charter referrals that we send out, and we occasionally get disposition of those cases back. and that is really more of a agency by agency outcome for us. we also make referrals to departments using our liaisons because in a summary of cases that we investigate, it really
covers everything. so there are times when we can be experts on something, but, for example, if you've got a question about medical privacy, our liaison partners in p.h. are much more able to handle that and we rely on them. and those referrals that we make that aren't charter referrals, we will track those outcomes. when we refer out to a charter department based upon a charter mandate referral of those complaints, we don't always get the information back. so in the numbers that we report out, we aren't capturing every disciplinary outcome or change on those charter referrals, but if we keep them inhouse and use our liaison partners to get an answer to the allegations we received, we do get an outcome and we do report that out. >> chairman: thank you for clarifying that. and i would be interested
in whether it would be possible to have the -- when you do the charter base referral, which is essentially something you don't have jurisdiction over -- i think getting some kind of -- institutionalizing some kind of report back so that it is not occasional would really be helpful. what happens is some of the more severe things that uncovered by whistle-blowers are actually in the whistle-blower report, and they just show up as a referral. so i think in some ways, i think we're understating the impact of whistle-blowers and of this program because of the nature of that referral. i don't know if that is within, you know, the controller office's power, something we have to address legislatively, or by request to departments. i would be interested to
make sure we have a uniform system, so that for anything you refer you are getting back, the ultimate status of whether some corrective or preventive action was taken. i don't know if you have any comments on that, butt i look forward to working with you on that. >> this has been a matter of discussion within the week with the deputy controller, as to how we can capture that sort of information once it is out of our jurisdiction. but to your point, getting some credit of something we're mandated to refer but results in some sort of action. i would look forward to working with you and deputy controller reedstrom on how we could frame that sort of institution. >> chairman: thank you. supervisor chan? >> thank you, chair preston. i think my question really is along that same line,
about, you know, corrective action or preventive action that results from these complaints. just seeing that the consistency of the 30% to 40% of the complaints resulting in any type of corrective action -- i'm kind of curious -- the fact that it has been very consistent, that percentage, almost no matter the volume or types, could you explain to me, like, how -- why -- i mean i think -- i don't even know how you could really explain that percentage consistency, but i'm just kind of curious as to why you think that percentage is consistent while my assumption is the type of complaints have been varied, including the volume. do you think it is because the processing protocol of
the whistle-blower program that kind of results into the consistency of that percentage? i just kind of want to get your insight on that. >> sure. and let me preference my answer by saying it is nothing we've taken a really deep dive into. i'm going off more of my instinct with the experience in the program. the number of complaints that we receive, while it has been increasing, has not really diverged in the types of complaints that we're getting. we're just getting more of them. and so that the outcome remains fairly consistent. it is not surprising because i'm not seeing a difference in the type of complaints that we're getting as we're getting
more and more complaints. i think the procedures and practices we've got in place to triage and review these complaints remains consistent, in spite of the volume we're seeing, but in spite of the volume we're seeing, we're seeing the same type of complaints. you know, as we move from 400 to 500 to 600 complaints a year, we're not seeing more of one type of complaint versus other complaints. i think the spread of those types of complaints are consistent percentage-wise, but given the volume, we're just getting more of them. i think that might be the reason why we've got that remarkably -- not remarkably, but to me surprisingly consistent 30% to 40% band of complaints that we've investigated that result in corrective action.
>> great. so with that, you're just saying that we're increasing in volumes, but it is kind of consistent of the type of complaints. so i'm looking at your quarter 2 report, the type of complaints referred to different offices, so with that assumption, what you're saying is that type of complaints have been consistent, even though the volume has increased. and, therefore, it is consistent in the way they resulted in the percentage. so what you're saying, and i'm looking at your quarter 2 report, i am seeing the highest percentage of the cases that actually refer -- the complaints that were referred to the departments, and the two that really stand out for me are the district attorney's office and ethics. they're at the 21-something percent out of all of the complaints that you receive.
that means, to me, with that pattern, they are either criminal allegations or that they are ethical lion, like, violations. that is the part where it is alarming to me, that if the type of complaints that come in are consistent in pattern, even though there are increases in volumes, therefore my assumption is that it looks like the highest referral is criminal allegations or ethical violations, and yet only only 30% to 40% of the time they are resulting in corrective or preventive actions. and not in the higher rate of any -- you know, of other types that are more serious action, so to speak -- or maybe the corrective actions are pretty is serious, but we just don't know how
they're being broken down to, considered as corrective actions. i think that goes back to what chair preston is saying that we want a better understanding of the type of corrective and preventive actions that are as a result of these types of complaints. so i just kind of want to say that because i'm also looking at report outcomes. again, in your quarter 2 report, just looking at personnel actions that are either employee, council, or suspended terminations, or even employee resign during investigations, versus other corrective action or policy or procedure changes or reenforcements. again, it is at a much higher rate. policy or procedures change -- in all, if there is a criminal allegation, that is one of your
highest percentages of referrals, but it looks like a majority of times, it doesn't result in criminal charges, but policy or procedural changes -- i think you know where i'm kind of leading with this. which is why we're seeing the muhammad newer allegations, which some of those allegations reference years back, that pattern. what i'm trying to say is with this report, the whistle-blower program actually is -- i am identifying a pattern from the whistle-blower program, the way that it is being processed. you do have some of the highest percentage of cases being referred to the district attorney's office or the ethics commission, yet your results are consistently -- the so-called correction -- corrective actions or
preventive actions the majority of times results in policy or procedural changes or reenforcement. and instead of identifying really there are probably personnel issues that are -- could result in criminal charges. that's all i'm trying to put together. if you want to validate that, feel free. but i don't want to put that on you to validate. if you have any insight to what i'm saying or counter the statement i'm making, i'm happy to hear from you. >> thank you. you faded out for probably 10% of the time, so if i missed something, i apologize. let me just respond this way: when we make a charter referral to the district attorney's office because the allegations we receive are criminal in nature, we will close out
that case, and we don't consider that investigated, so it wouldn't be reported out as part of that 30% to 40% of investigations that result in corrective or preventive action. i think that is kind of where supervisor preston was leading us earlier, in that how do we obtain outcomes for reports that were duty-bound, charter-bound to refer that do result in criminal charges or prosecution or ethics charges going forward? so when we refer, based upon our charter obligations, that is not included in what we consider investigated because we're charter-bound to close after we refer it and are done with it. supervisor preston was
getting at, and what the deputy controller was getting at when i spoke to them last week, is how do we recoup those actions that result after a charter referral in any sort of disciplinary or criminal policy changes going forward. and to the extent we can figure out a way that what starts with a whistle-blower, even though it is charter referred out, that results in some sort of changes, whether it is changes against an individual, disciplinary, or even criminal charges, yes, we would definitely be interested in figuring out how to recoup some of that. >> if i may jump in, todd reedstrom, deputy controller. we appreciate the questions because in addition to the national and local -- as far as the information sharing and the awareness of the program, hearings like this, with people watching
sfgovtv, and your questions are also very helpful to us and to the effectiveness of the program, and so what our offices can do, and we would love to explore with you, we will welcome from the charter-referred departments for information, and they may or may not want to share that with us to protect the integrity to open investigations. but to the degree they are, they would like to be included as far as what the outcomes are, those would be helpful to the public, to the degree they're ready to be publicized. that would be a nice addition to the report. so happy to explore that further with you, because the public deserves to know this is a very affective tool. and the affectiveness of the tool is what is in the report. >> i appreciate that. i see that supervisor
mandelman has a question. my last question is that i'm seeing this chart, talking about reports investigated and closed in the last three fiscal years by the department, and i'm seeing the numbers -- ie highest numbers, and i also love the fact that you kind of give a ratio to tell us by the complaints filed versus how many people within that department, so you give a ratio whether it is low, medium, or high. i did want to point out one thing, besides the ratio of personnel staffing, and also to the complaint. there is one thing i want to highlight and understand better. it is also not just about the ratio, but it is also about besides just the city departments themselves, how many complaints they're receiving, but it is also the individual that the complaint is filed against within that department. so, for example, if
someone -- there is only one or two complaints for that city department, but consistently is the same individual -- i'm just kind of curious, like, what does it -- if it is not criminal or ethics, or maybe civil service, which i see is one of the categories in your report, what typically then happens? how does it work? what would the whistle-blower program do? >> the, um -- i think within whistle-blower, when we have a constant flow of complaints coming across our desk every morning, we're able to identify departments that are frequent flyers, names that come up again and again.
and when we identify toxic work environments, when we see within a certain department or a certain location of a department, where we've got multiple complaints about the same manager or complaints that go back and forth between people, we're able to identify that fairly quickly and raise it as an issue. and that will depend on the department. that will depend on the situation. i'm thinking of one location where we've got multiple complaints about management and multiple complaints with employees against each other. we have raised that issue with the department and identified that location as a problem. in the three instances i can think of where i've done that in the last two years, it was not a
surprise to any of those departments. they know there is a toxic work culture in certain offices within the city. and to varying degrees they are taking steps to respond to it, even before we get to them to identify it as an issue. i can think of another circumstance in the last six months, where we received the same complaints about the same employee at the same location against the same manager. excuse me. 10 days in a row. so clearly there is an employee with a problem that doesn't think he has got a means by which he can seek any sort of resolution. when we get situations like that -- excuse me again -- we'll work with our department liaisons to identify this issue and ask that they work to find a solution. we'll still go through our
whistle-blower process, but when those hotspots come up, and they bubble up from time to time, we'll work with the department to department to identify the issue, outside our whistle-blower process, to say, hey, you've got a problem here that needs some attention. and based upon our good working relationship with those liaisons, they can then take the next appropriate step to escalate to the department head, to h.r., to whatever is going to be most appropriate. but as the front desk for complaints that come in, you know, we routinely consult this d.h.r. and civil service on a quarterly basis to let them know what we're seeing and they let us know what they're seeing, so we can try to identify these trends and locations when they're specific to a work site, so that we can take the next appropriate step, whatever that might be. but i think that is one of
the unsung virtues of this program, is that as the initial intake point for anybody who has a problem with how they're working with government, how they're interacting with government, we can consolidate and identify issues in a way that others aren't necessarily able to do so because we're the front desk. we're the first place people come to. >> yeah. i think this is my comment. thank you so much for answering all of my questions. i really appreciate it. i think this is my last comment now, and it is the reason why i think that when we appoint a new h.r. director, carol isen, it was a critical point for me to understand that how under her leadership she will put in place sort of a checking mechanism in all levels of city government, you know, from frontline staff all the way to really the
executive and city department heads to make sure that the working culture is not toxic, and being able to flag in all levels before it just got to, you know, someone like, unfortunately, our former director, muhammad newer. and even some of the sexual harassment complaints we see from sfmta, it didn't really come to light until there was lawsuits filed, and you see there was already here a pattern. those are disappointing to learn years later. so i hope and look forward to having our h.r. put in place the city government to make sure we check these behaviors before they fester and become a pattern. thank you, chair peskin. >> chairman: thank you, supervisor chan. supervisor mandelman? [please stand by]
complaints. my other question really has to do with new rules. one of them you touched on, i was curious how that episode had impacted whistleblower complaints going forward. it's reminding people that there is this ability and maybe obligation to report when something is wrong or seems wrong. that seems like a positive. the harder question that i would invite anyone to speculate on if they're willing to or feel comfortable doing it -- this looks and feels like shocking.
to have this number of department heads going down. it creates -- this is unfair because most people in san francisco government are doing their jobs. they are corrupt. they are motivated to serve of public interest. to see this many department heads going down and other folks in these department implicated things that are fraudulent, makes one how this was able to go on for so long. i know we don't see all of the case -- all of the situations where the whistleblower program catches something that doesn't
fester into giant sore on the body politics. these sores festered and grew and spread across departments, created doubt and concern in public and among elected officials as well. in retrospect looking back -- if anyone done this analysis, is there a way that the whistleblower program could have or should have identified some of these festering situations? is there some way the whistleblower program can be changed to make it more effective in spotting this stuff in the future? only way to get it is for republican u.s. attorney to investigate the hell out of san
francisco. >> i will jump in. i won't speculate. i can't do that. i will say we're interested in exploring how can we know what the outcomes are and how much of the investigation can be shared as early as possible in preserving integrity of the investigations. these civil, these criminal, these ethical retaliation violations, they are required for us to be deferred to the departments. we can add those results without compromising an investigation early on in quarterly reports that provide some additional information there. we would welcome that opportunity and would invite those departments to share as much as they can without and still preserve that integrity. the items of note in here, these
indictments in particular, they are either civil or criminal related to charter required referrals. we are happy to come before this body i believe respectfully, could invite other departments that are charter authority to do that part of the investigation. i would respectfully refer that down to you if you wish to invite others to co-present with us quarterly reports, future quarterly reports. >> supervisor preston: i like to share a thought on this topic. it's one i raised in principle with the comptroller office and hopes we can work together on. i think that the comments about talking with folks and holding this information.
this is kind of frees them to come forward. obviously those are the folks who have known about a lot of what we're hearing in the news and from criminal prosecution for years. the challenge is how to make it so that they come forward. the entire model of our whistleblower program, i believe most any whistleblower program in government is about protecting whistleblowers from retaliation as the way to make them comfortable coming forward. what in my view is completely absent is any proactive attempt to actually incentivize people to come forward. i think that the challenge for us when you look for examplar what has worked around private complaints, mostly nationally. it has been the entire false
claim action structure in which somebody who has information, who knows there's illegal claim being made for contracts, they can come forward to give the government an opportunity to prosecute that case. if they don't, they go hire a private attorney. it can be lucrative. that has incentivized folks. the expectation that folks -- how much you protect them, there's always a fear whether founded or not of potential retaliation or adverse consequences. we can continue to try to protect folks from that. i don't have the solution on the fly. i think we have to be thinking about how we actually incentivize where it is not just when someone comes forward, things don't change for them. when someone comes forward and do that heroic and important
act, it improves their situation. to me that's the challenge to your question how we get folks coming forward. >> i think there could be ways not to be protect whistleblowers but incentivize whistleblowers. there's a number of complaints that come in that are about toxic work environments where people are just eager to harm each other. using the whistleblower process as a way other means in these workplaces. i'm interested in this idea of incentivizing more. what i'm little unclear on is whether there's been a postmortem that the comptroller participated in on the whistleblower processes over the last 10 years. whether the alarm bells were
ringing and no one -- were the whistleblowers coming forward saying i'm in public works. there's a problem. i'm in d.b.i., there's a problem. was that group getting dealt with each complaint, working its way through. was it the case that the alarm bells were sounding and nobody -- somehow the system failed to send in the fire trucks. >> if i may start. thank you for the question. i think it's a really interesting idea. some of the things that we have done is to see if there's disproportionality in claims. taking that question from your
previous, taking that back to say, further going down, not just employees which we do in the report that shows the last three years in the secular trends against different departments. taking that same reports complaints against contractors for example. those are the next layers. i think it's an interesting idea to the degree that the alarm goes off and the alarm is a criminal or civil case. that alarm is referred and dispatched directly to that charter department. this idea something worth further discussion and how we may do that in way with those other departments. >> supervisor mandelman: i'm hoping, i know there's been this massive city attorney,
comptroller effort to evaluate what went wrong here and find everything that hasn't been reported. i would assume and hope some of that involves looking back at did we miss alarm bells that we shouldn't have? this is on the comptroller office, is there some way alarm bells that could have been heard more and responded to better? you don't have to try to answer that. i'm really hoping that this is something city attorney and our comptroller and anyone else involved in this project retrospective look at corruption. >> one of the things we've been doing, we've been reporting on
public integrity assessments. one of the key deliverables is like this capstone final report that will basically touch on those postmortem implications that you're mentioning. are there tone at the top issues that should be systematically addressed city wide not just certain departments. are there certain ethical reinforcement of the city's requirements and values that should be reinforced further. those are going to definitely be a part of our postmortem, as part of our final report in our series. point well taken. >> on a weekly basis, my representatives from the d.a. and city attorney's office and everything that we get they see.
we're working with other departments to identify these issues and sort of get nip them in the bud and take care of them in a way that we have not been doing during the establishments of these ongoing weekly meetings. >> supervisor preston: superviso >> supervisor mandelman: finishe d. >> supervisor preston: i like to second the sentiment supervisor mandelman was expressing. i think it's an important thing. the problem was that folks didn't speak up.
we need to incentivize and better protect folks feel comfortable speaking up. if they have been speaking up, we missed it. whenever department. if there were some warning signs along the way, i hope that's part of the postmortem, mr. clerk, we can go to public comment. >> clerk: james smith is monitoring public comment caller line today. thank you mr. smith. for those folks who wish to speak, if you are on hold, please continue to wait. you will hear a prompt that will inform you that your line has been unmuted. for those watching on cable 26, or sfgovtv.org, if you wish to speak, now is your opportunity. you will do so by calling the following number. 415-655-0001.
meeting i.d., 187 597 7161. press the pound signal twice. there's one speaker on the line. >> caller: good morning david pill pal. on item 1 page 4 refers to the review of the city's rate setting process for garbage collection. that was issued yesterday. that may help explain item 6 on today's agenda. that should be the subject of the future hearing at this committee. i will try to contact mark del rosa to share my thoughts onment comptroller ongoing audit work.
i would continue to hear these reports on the whistleblower program on a quarterly basis. that will be helpful. my question today and touched on this in the earlier discussion is do the number and type of complaints received through the whistleblower program impact the prioritization and risk assessment of city department audits by c.s.a. or for that matter the budget legislative analyst and others who maybe conducting audit reviews and reports of city department activities. i look forward to reviewing today's presentation after it's posted and thank you all very
much. great work. >> clerk: thank you for your comments. >> caller: hello, i i was involved in teamster local 350. i'm a native san franciscan. over the years we had members complain about the rate process and even the budget. san francisco board of supervisors own budget analyst raised questions about the numbers. was overruled. supervisor mandelman got his comment about it took a republican attorney to come in here and really clean it up. when ed lee was at public works,
whole thing has been going on for years. these are the keys that we wire up. we need those two people on the rate appeals board. we need public works. we need district 10. there's a whole bunch of schemes and stuff that goes on and things were reported and mostly went to deputy city attorney and it gets buried. it's like it is. garbage in and garbage out. nothing changes. it's a complicated web. following the dots, following the money and following the intricate bait and switch scams that have been going on.
mohammed nuru was just sloppy. it's just corrupt like this. it really is. it goes back to mayor brown. most of these are paid to play situation. >> clerk: thank you for sharing your comments. checking mr. chair at this time with mr. smith. there are no further callers in the queue. >> supervisor preston: thank you for those who called in. public comment is now closed. seeing no other comments or questions from committee members. i like to reiterate my thanks to mr. del rosa, mr. jensen for your work on this. we look forward to the next quarterly report and continue to
be in communication with your office and special thanks to all those who have filed and made whistleblower complaints. it takes lot of courage. you have saved the city lot of money and lot of people out of mistreatment. we appreciate you. motion to file this item? call the roll. >> clerk: on the motion offered by the claire to file -- chair to file this hearing. [roll call vote]. there are three ayes. >> supervisor preston: please call item 2. >> clerk: general 2 is a motion concurring actions taken by the mayor 35th supplement of proclamation of emergency to meet the emergency related to
the novel covid-19 coronavirus pandemic by allowing department to extend covid-19 related contracts through streamline process for 12 months. allowing the civil service commission to prove emergency personal service contracts without requiring advance union innovation otherwise requiring memorandum of understanding. authorizing the controller expedited payments cost of living increases to nonprofit organizations that provided services under existing agreements with the city. members of the public wish to provide public comment would call the public comment number which is 415-655-0001. enter the meeting i.d. 187 597,
7161. >> supervisor preston: thank you mr. clerk. this item relates to the 35th supplemental. there have been many orders from the mayor since this declare state of emergency. those have been all unanimously concurred by the board of supervisors in was -- we took the unusual step of asking for this one to be referred to committee because we're here again and this proposes to continue an alter symptom streamlining of contract approval. i want to be clear that the 13th supplemental continues to
be in place. even as we refer this to the this committee. felt important to take a look back and how the powers under the 13th supplemental which allowed for contracting during the state of emergency. to see how that had been utilized and better understand the proposed changes with the 35th supplemental. i want to thank the controller's office for their work with us before this hearing and turn it over to present on this item. >> thank you very much. i'm joined today with the acting directorrer if the office contract administration.
when the city declared a disaster, our office has the responsibility to staff the finance section of the emergency operations that includes the accounting and tracking as well as the support to the procurement function which is call the logistic section. around april 2020 there were 10,600 city employees that noting on their time card they were working on disaster
response to the covid-19 pandemic today those numbers have come down. still there's very large most recent activity. there are about 2800 city employees that are still continuing to work and note that on their time card in addition to all the people that d.p.h. and h.s.h. and homelessness and supportive housing department and others who are working to help those affected, impacted by this pandemic. it's a very large effort. that's put some burdens what would be routine practices for procurements. those are really addressed and part of the need for the 13th and now the updates to the 35th. related to that, i wanted to to go through some of the numbers as far as what this has meant and how it compares to city's typical procurement in the context of our totals,
$13 billion plus budget that you approved. on the next slide, just a brief summary. taking us back to the declaration being declared february 25th and the 13th supplement coming in may 11th. that covered both covid related emergency contracts up to a year as well as other purchasing which permitted extensions of existing contracts of six months but no later than june 2021. that at the time was very important because we all pivoted on a dime became subject to shelter-in-place, working remotely. at that time, the administrative function over 10,000 city employees that were doing administrative type of work including contracts and procurement and finance and accounting started to do their jobs from home. that included making sure that players got paid as well as employees got paid biweekly has
that frames the -- >> supervisor preston: just before you go to the next slide. if i can jump in. two other things that strike me as shifts from the 13th to the 35th. i want to make sure i'm understanding it right. one is under the 13th supplemental, when a department used the process described in the 13th supplemental, they are required to submit a copy to the mayor and to the board of supervisors. that was eliminated in the 35th if i'm reading that
right. i wanted to confirm that i'm readily -- reading that right and understand why that was changing? >> thank you for the question. there was a monthly reporting requirement in the 13th. my recollection. then the reporting requirement has that updated in the 35th to be as requested including our office working with the departments to figure out what i to standardize the reporting. in our policy memo, we also notified them that by august 13, 2021, they should provide a list of all contracts that went through this process to all departments that require approval including o.c.a., civil service commission. our office issued that directive as part of our policy memo. in addition to that, the board and the mayor's office can request of our office at any
time what we have in the system. i'll be happy to go through what we have automated sight line to and what we have to go back and work with departments for. i have that on a later slide. >> supervisor preston: thank you. the other change was around whether a department needs to obtain three quotes prior to entering into one of those covid related contracts that was required clearly through the 13th and it appears not to be you required under the 35th. if so, why that changed? >> in our policy guidance, we continue to require that departments move back to the traditional procurements including the three quotes. in the event they can't, we go through with them and explore
ways that we can assist them get the three quotes. we recognize they are part of thousands of employees who have been deployed and shifted to responsibilities. we're not willing to just take that no for an answer because one of the requirements is we're trying to maximize the city's eligible reimbursements to fema. fema is looking to us, now that the pandemic has been such a protracted response period, that we got best value and lowest price because the feds are also reimbursing now what is up to 100% of eligible costs. we recommended that and we go through with that and unless
there's a circumstance that we would say that seems right. we would assist the department to figure out how to get those three quotes somehow. >> supervisor preston: i see supervisor chan on the roster. do you have a question to clarify this particular slide issue and you want to ask that now or do you want to wait until he completed his presentation? >> supervisor chan: this is specific on the procurement and the bit for the three bids. [indiscernible]
>> supervisor preston: superviso r chan i don't know if it's my connection or yours. you're breaking up a bit. you may want to restate. >> supervisor chan: even before the pandemic, we were able to really assist any city department in the case of emergency situation without going out for bid and have a soul source situation so they can respond to any emergency situation. is that correct? >> i can start.
i'll defer to my colleague. couple of things before this emergency, supervisor to your point. many departments are quite familiar with their usual procurement patterns. they note their suppliers they know their competitive process, whether it's r.f.p., request for proposal. in addition to that, when we have an emergency, sometimes they're asked to do jobs at the the emergency operation center where they may not be familiar with those procurement types whether they be commodities or specialized services. things like that we help staff finance an admin section. in the financial system we have 170,000 competitively bid products which department may not to be familiar with because
the other department doesn't use those products. that's one of the abilities to provide that sight line where we bid something already, who is the awarded supplier that we can buy that off of. >> good morning supervisors. supervisor chan, your question related to emergency procurement prior to the pandemic and what authority the city has to make those emergency procurements. there is in fact section of chapter 21 which covers general services professional services and commodity purchases.
section 21.15 that outlines the requirements for emergency purchasing. in general, departments are not required to obtain quotes or do solicitation if there's a true emergency that needs to be responded to. departments are encouraged to do solicitation regardless of the situation. early on during this pandemic, much of the procurement happened without solicitation because of circumstances that needed to have services and contracts in place quickly. deputy controller mentioned even fema very soon after the emergency started within months was asking governments essentially to go back to some
sort of normal procurement and do solicitations. back in may when the 13th slup 3 supplement was issued we required three quotes minimum for emergency type purchase. i hope that answers your question. >> supervisor chan: yes. thank you. >> supervisor preston: thank you. can you finish that thought why that's not in the 35th supplemental. i understand why it was included in the 13th. i'm curious why that requirement is not in the 35th? >> if i'm not mistaken, the 35th addresses extensions to existing covid contracts. that would include the solicitation requirements as well as the controller's approval for not obtaining a
solicitation or not conducting a solicitation as well as other contracting deviations essentially. >> supervisor preston: thank you. please continue with your presentation. >> thank you. the next slide, provides some context as far as the covid-19 emergency procurements related to the 13th supplement. there have been both written executed contracts. we presented them in the long form contracts. there's been purchase orders procurements which we direct purchase order kind of a short form. that's about two and a half page short form contract as opposed to fully executed written contract. what has happened under the 13th for written executed contract exceptions are 15.
in addition to that, there are grant award contract amendments that were allowed under the 13th supplement. that was typically for contracts with community-based organizations and nonprofits that provide services and collaboration and under contract with various city departments. that was 129. you can see that total about $77 million in the bundle of 15 contracts that covid related were about $46 million. in addition to that, the direct purchase order at the bottom, you'll see short form contracts. there was about 19 of those, $2 million. we did get some updates on the non-covid contract extensions down below there. i believe director, it was 25.
>> that's correct. our estimate is an o.c.a. estimate for chapter 21 contracts. >> may have been other non-covid-19 contract extensions, not chapter 21, for example grants or leases. that were extended. >> that's one of the reasons why directed all departments as of august 15 to submit a comprehensive list to ensure those that are contracts and procurements related to covid spending as well as those that are non-covid, each of those departments we're working with them to ensure they can comply with that august 15th filing. on the next slide, this explains what was procured. for the corresponding rows, you can see i have them listed them,
a through f. as needed hospital beds, medical contracting staff, research planning, testing and hotel rooms, grant contracts to nonprofits to extend the durations of those as we were sheltering place. as well as n95 masks, ada accessible bathrooms and cleaning and janitorial services. that gives you a feel for relatively small amount of procurement that happened. on the next slide, what does the city usually buy and how many contracts are there usually. typical fiscal year for us, we would have approved beginning in that fiscal year over 3500 contracts. that helps compare slide 5 which you saw on slide 3, to give you
some relative framing of it. non-construction will be about 44%, grant contracts, you'll see about 50% and then construction would be smaller number but still a very large dollar value. that's how fiscal year '19, '20 when the pandemic started, that's how the entire procurement executed contracts looked like in the city. as far as the short form contract the city would have issued over 93,000 of those. comparing those to what were requested for exceptions under the 13th was a very small percent, usually less than 1%. on the next slide, the summary of the 35th supplement is here.
largest bundle is really the shelter-in-place extension as long as they are needed. these covid related contracts require civil service commission approval. those will be revisited when we have been working with the civil service commission as well as the office of contract administration to streamline and automate that through the dashboard. the non-covid contracts extensions will be permitted up to six months no later than jun. allows us to develop criteria. we've done that and issued that to the departments. the qualifying contracts not just all contracts but qualifying contracts will be covid related before february 1st this year. it's a relatively time framed
limited universe. also it allows us to consistent with your approved budget in the annual appropriation ordinance. the payment of board of supervisors approved cost of doing business increases without contract modification for the nonprofit community-based organization contracts. noted we worked and are working with the civil service commission to ensure that the notification and streamlining is in place. then updates for reporting. there are changes and the migration from the monthly to the as needed and the controller periodic reporting as well. those are the key points for the 35th and echoing one more time, the charter mandates are still in place as are campaign and disclosures are in place and
required under the 35th. >> thank you, todd. i will dive more deeply into the non-covid contract extension under the 35th. prior to issuance of the 35th supplement including the lead covid response agency approached the o.c.a. and controller office seeking relief regarding contracting requirements. given the significant constraints that they were experiencing due to the continued covid response efforts. in order to understand the magnitude of the need for any update to the contract extension policy that was allowed under the 13th supplement the controller office and o.c.a. tried to identity number of contracts that will be using this new contract extension
here you'll see the list of identified non-covid contracts. those that were valued at $5 million or greater. i mentioned before that the total value all identified contracts was over $500 million. as you can see here that value is largely driven by one very sizeable d.p.h. agreement, $225 million agreement. the majority of identified contracts were for much smelter total -- smaller total value. departments have been notified via policy guidance issued by the controller office that the allowance under the 35th are temporary in nature. that departments are expected to transition back to standard procurement processes as much as
possible. for all covid contracts, departments are still required to solicit. for any contract extension, amendment values must be commensurate with time extension. >> i hope that provides some context of the 13th and the 35th. on the next slide, all the things that we don't know and what we do know that might also inform the board's deliberations. not sure if you can go to slide 10. i'm not seeing it on my end.
i'll continue to talk assuming you can still hear me. we do know that there's a couple of key large unknowns. one known that we have is what fema has indicated so far that the fema public assistance grant reimbursement, one now eligible for expenditures up to 100%. they said that they continue to honor that through september 30th. they've previously extended that deadline. i think it's going to depend upon lot of things that's unknown and consideration. depending on what the vaccine availability is and the rollout of that, the learning everyday as far as how long that vaccination will last and whether it last or not with new
mutations. also what will be the staffing needs for the booster shots and the event that boosters are needed sometime in the fall or even in the winter. these are things we don't know and we would defer to dr. colfax and d.p.h. for the latest on those. what we can say, from the financial swim lane, the demands put on those departments, especially departments that have been stretched, are going to all go back again to probably d.p.w. as well as o.c.a. and others. we don't know exactly what the when or if and how much procurement needs are going to be. i can't emphasize enough the herculean and great work the city and staff have done.
people have been really stretched. it's been over a year. there's so much capacity and there has to be a time to catch up i think. in addition to that, the return to work process and what typically happens with the procurement. in my experience, the typical procurement will take 6 to 8 months. from identifying the needs, specifics of it, developing request for proposal or request for quote, doing the noticing of opportunity, going through that process and evaluating it, it will be 6 to 8 months. that's what we know and don't know as of now. you may want to consider as part of your deliberation. >> supervisor preston: thank you. thanks to both of you for the presentation. i do have a question just on
slide 9, where you were talking about the guidance to departments. here we're talking about the non-covid related extensions, the contract extension, policy -- there's a reason folks were behind from being able to process these through normal channels. this is not meant as criticism at all that an expedited process is deleted. i'm curious, if there's anything more specific than -- seem like the guidance return to regular procurement as soon as possible. as opposed to kind of laying out and more specific timeline. within x number of months, we're expecting folks -- the
departments to be pack on a regular procurement cycle. i'm curious if you can address that. do we have enough information where we can set a timeline and have reasonable expectations. >> i think i can take that question. as deputy controller, it generally takes it at least 6 to 8 months to do a very thorough solicitation for the more complex procurement. essentially, pretty much as soon as this authority is granted for any particular contract, departments are going to have to start think being their schedule for procuring to get the next contract in place before their extension ends. i'm certain that most of these departments are starting to plan out their schedule for getting new contracts in place over the
coming year. again as noted, previously, the extensions for the non-covid contract can go only until june 30, 2022. which might sound like a long time. departments will need significant amount of time to conduct their procurements. they know it's short-term. they likely know likely not will be extended again and the authorization will not be provided again. it really is just to buy time to get back on track. >> supervisor preston: thank you. seeing no questions from colleagues on the roster. let's go to public comment. >> clerk: thank you. we're working with jim smith to bring in our callers for public comment. for those folks already on hold waiting for their opportunity to
speak, please listen until you hear a prompt that informs you that your line has been unmuted. if you wish to speak on this item, please call now by following the instructions displaying on your screen by dialing 415-655-0001. enter the meeting i.d. 187 597 7161. >> caller: david pilpel eagain. briefly fascinating discussion in the weeds on government operations. one of my favorite topics. i wanted to thank you chair preston for sending this to
committee. great discussion. thanks. >> clerk: there are no further callers in the queue. >> supervisor preston: thank you mr. clerk. seeing no further public comment, public comment is now closed. i did have one last question. i'm curious if any suppliers or contractors or anyone will be banned from utilizing this process? in connection with our earlier discussion and to the extent there are anyone under investigation or concerns being flagged through any of our other good government efforts just raises any time we're having an expedited process for something, raises that concern. is there any connection or
conversation, if in theory or if it's happening in theory? >> thank you for asking that. there's actually two layers. in the case of any federal grant, we must also review the federal government's website. that's one of our routine checks we do before entering into a contract. that's because this is potentially fema reimbursable. that will be disallowed supplier if that were to happen. that's one of the assurances. in addition, we have our local
under chapter 28, which the board adopted the city attorney proposed updates to the department chapter to add the suspensions. we have that and those actions are posted on our website. we review those to make sure that the city's money and constituent's -- cities contracts are going to suppliers deemed eligible. thank you. >> supervisor preston: superviso r chan? >> supervisor chan: thank you chair preston. i think my question is kind of follow-up to what was just being asked. i know that it's great that we're making sure we're expediting cost of doing business, payments to our nonprofit organization that have been providing critical services over the past year. i wanted to see that. they obviously seem eligible and the services are needed. how do we make sure that departments are implementing
this equitably? >> as far as equitable inclusion, the departments do also have in the city wide financial system and the reporting dashboard, they can see supplier inclusion and spending trends by supplier. they can see it by-product category as well. that's something we partnered with the director and other departments to provide that sight line who will be eligible suppliers under various types of categories. those include race and ethnicity as well as gender through the local business enterprise program that contract
monitorings division c.m.d. runs. that's not inclusive every supplier. most of our suppliers don't have the opportunity to self-report that. >> supervisor chan: this is my last question. maybe i missed it from the presentation. just kind of wanted to understand better, sorry if you explained this, why is it the public health need to waive m.o.u. mandated union notifications? >> supervisor chan, you maybe addressing the civil service commission approval and union notification issue. it's my understanding under the 35th, the requirements for civil service commission approval and union notification
were never waived. they were just clarified. departments who doing emergency procurements or doing requesting extensions to their emergency covid contract will be civil service commission approval. as require under the 35th supplement. it's not waived as applicable contract. you may be referring to the non-covid extension. under the non-covid contract extension department are not required to obtain approval and the rationale is because those contracts were already put in place and would have applicable contracts departments would have already have to go to civil service commission and do their union notifications for those contracts. this was a way to expedite these
advance of this hearing around the various contracts and procurement. i appreciate all the information and feel more comfortable voting on this that the full board will be recommending that my colleagues support. i think there's a broader question that i wanted to flag. which is just on not just on this supplemental but as we emerge from the pandemic, winding down these various emergency orders and what kind of benchmarks we need to hit to get to a point where we're returning to normal processes. supervisor peskin raised this recently at the board as well. this hearing and this particular order, i view in the context of that and looking forward to
continuing to work with you on that. i will say that in the shift from automatic reports to the board to as requested by the board, i will like to move forward with controller's office with expectation that consider it requested. we can discuss further whether that is -- how frequently so we get the information we need without being unduly burdensome to your office. we can work that out. i wanted to make that comment. thank you both and colleagues, can we have a motion to refer this item to the full board with recommendation? >> supervisor chan: moved. >> supervisor preston: mr.
clerk, please call the roll. >> clerk: on the motion that this motion be recommended to full board of supervisors. [roll call vote] there are three ayes. >> supervisor preston: thank you mr. clerk. please call the next item. >> clerk: would you like to call all the litigation items together? >> clerk: agenda items 3-13 is lawsuits on claims against the city and county. i will briefly summarize them. settlement of lawsuit by frank villa, agenda 4 luis garcia
hernandez. >> supervisor preston: before we consider these items in closed session. i wanted to address publicly agenda item number 6, the recology settlement and do so and give committee members an an opportunity to comment and hear from our city attorney around the details of the proposed settlement. normally we discuss litigation matters in closes session. for two reasons to have a initial discussion on -- in public. it's really two reasons. one is that this a matter where the city attorney has announced publicly, the settlement and details of it. it's appropriate before we go in closed session for the public to hear the details of the
settlement and any clarifications that are needed around the terms of the settlement. secondly, this is an unusual settlement. it directly impacts rate payers who are the beneficiaries not just the city generally but rate payers are beneficiaries of the settlement. all the more reason the public hear some discussion around the terms as well as have an opportunity to comment on that in public comment before we talk about it in closed session. i do want remind my colleagues, as issues of litigations, strategy and that type of thing, we will reserve those discussions for closed session. i wanted to -- unless colleagues you had needments on that off the bat, i'll turn it over to our city attorney to discuss the terms of the proposed settlement
in item 6. supervisor chan? >> supervisor chan: i can wait until after the presentation and make my comments. thank you. >> supervisor preston: deputy city attorney? >> good afternoon chair preston and members of the committee. i'm deputy city attorney ann pierson. i'm joined by my colleague who's been working on this settlement. i'm going to defer to them, the description of the settlement terms. >> thank you so much. chair preston and supervisors chan and mandelman, thank you so much for giving us an opportunity to talk about the settlement. i'm going to talk you about the litigation and the settlement terms broadly. then i will defer to our chief deputy who will discuss the
remedies we've been able to secure in this settlement. just zooming out for a moment. we filed a complaint on march 4th. that complaint alleged two causesful action. one we brought on behalf of the city and county of san francisco. one we brought under the unfair competition law. there were two kind of buckets of allegations that were made in that complaint. one involves allegations that recology had developed an overly cozy relationship with san francisco. that has led to gifts and payments that violated our campaign and governmental code. then, we also learned that recology had made an omission in its calculation that were the
underpinning of the foundation for the 2017 rate making, collection rate making. as as a result of that omission, residential and commercial customers were overcharged for garbage collection services going back to 2017. the settlement that we proposed and are asking this committee to approve resolve both aspects of that case. there are certainly terms that are articulated in the settlement agreement and those deal with reimbursement to commercial and residential rate payers of those overcharges. then we have stipulated with recology as to an injunction. that injunction is chiefly designed to never bring us back to the point that we filed a lawsuit. to address the unlawful gifts of
the payments as well as creating a mechanism of disclosure so that omission and errors come to the forefront more quickly. our rate payers aren't found spending -- paying years of overcharges. that's the general architecture of the settlement. obviously this stipulated injunction need to wait before we approach the court with the order. than has not been entered. in terms of what the remedies are in this litigation, i will defer to my colleague ron flynn. >> thank you. thank you chair preston, vice
chair chan and member mandelman. i want to echo yvonne is saying. it comes as part of one part litigation. it's really two parters. it deals with the what we call unfair and unlawful gifts and what yvonne called the cozy relationship between recology and the regulators. we have terms which i will describe to you to put a wall up between recology and the members of the city to allow that relationship to be reset. whatever policies come in place about how it city moves it forward, those are really done at little more arm's length in compliance. those terms is a four-year term after -- if this board approves
this settlement and we go to the court and enters the injunction, it will be a four-year term. it would prohibit all gifts to city employees and officers. it would rather tell recology to stand down. it would prohibit behested gifts. it would mandate disclosures of payments nonprofits more than $1000 with city officials. it takes the rules and regulations that this board has crafted over the years about disclosures and it binds them to following them and not just following them in the guise of self-determination but a court order that says these are the actions that i must do. it requires that any recology employee acting as a lobbyist
appropriately register. there were no lobbyist employees registered as lobbyist. it's for them to determine if they fit in that category. we hold them to that under the injunction. finally it requires disclosure of financial errors mistakes and omissions. i want to say what that means for you for a moment. one portion of the city's relationship with recology involves the setting of rates for residential and thereby users. the city depends on recology to bring forth all kinds of personal information, audited financial statements and bringing it and put it before the city so it can be evaluated.
during this last process, there was a -- there were two components left out of the revenue side which would have resulted in lower rates being granted. there's currently no requirement that when a mistake is made like that or an omission, it is brought to the public attention. recology did bring it to d.p.w.'s attention. there was no mechanism posted publicly and made publicly. what we want to do with this injunction is for four-year term mistakes and omissions so they can be publicly posted at this body and others come through with whatever apology -- policies and mechanisms would be needed to sort of determine if
controller's office and we worked to understand the stope - scope of that. to give back 100% the overcharge at a 5% interest to our rate payers. that means they've been paying these garbage rates for the next four years. they will get paid back by september 1, 2021. for people who are no longer rate payers and there are mechanisms for the city to make sure there's a robust outreach and effort to reach those people to get the money back to the people who paid them. there's a new lower adjusted refuge collection rate that went into effect on april 1st.
the interest in the payments and overcharges are no longer accruing. it's to monetize what was happening there so we can know what the overage charge -- overcharge was. that's the -- restitution. out of both of those unfair competition and the violations of the campaign code there are civil penalties that amounted to $7 million. that is a strong message, we believe, to companies who are doing business with san francisco consumers and with san francisco that it's not just that when you get caught, tough to pay back, you have to pay a significant sign. those are the three components of the remedies that are part of
this negotiating settlement. >> supervisor preston: thank you mr. flynn. supervisor chan. >> supervisor chan: thank you so much for your presentation. i find it very helpful as a member of the board of supervisors, start thinking about policies and policy solutions. really base the on the fact that you can -- help me understand better what we can do in terms of be it troubleshoot or finding healthy solutions that can prevent this from happening again. i look forward to learning more about it in our sessions.
even just teaching me about coupling this from both the california unfair competition law with our local law and what that actually means and making that connection between the two is actually very helpful for me to thinking about as many different types of contracts that may or may not come before the board for approval. , what is it that we need to think about in terms of outside relationships with third parties. i look forward to learning more information.
thank you. >> supervisor preston: thank you. i want to echo supervisor chan. thanks to deputy city attorney for the presentation. for your work on this. at this time, mr. clerk let's take public comment on items 3-13. >> clerk: we continue to work with mr. james smith department of technology for the public comment caller line. >> caller: hello, i worked at recology and i was union represent at sun set scavenger
for years. i was going to call to speak on this item. first item of corruption was related to this. i would say that this settlement is a little bit rushed. i would have questions regarding the previous administration, ed lee and when he was at public works. the $1 billion landfill agreement that was granted to recology via the city versus the waste management long-term waste management landfill at altamonte which resulted in a bigger greenhouse gas footprint. this seems like it will be a violation of the california unfair competition law against waste management. how could waste management compete against recology and the city when it was wired up that way? waste management brought that forward years ago. my question is, this settlement
thank you very much. >> clerk: next caller please. >> caller: good afternoon david pilpel again. i refer to my earlier comments relate to the controller's public integrity review report on this issue. i attended every public meeting on the 2017 rate application and i'm familiar with it. i do not understand what the calculation error was. i have carefully reviewed schedules b1 and f1. this settlement is being presented outside the rate adjustment process outlined in section 6 of the 1932 ordinance. the proposed settlement has not been presented to the rate board or posted on the d.p.w. website. i was going to ask if someone could explain the error and the proposed monetary and non-monetary settlement terms. we heard a little bit about that
now from the city attorney office. i appreciate that. i'm interested in the details. i would urge you to continue this item until the controller public integrity review is heard and d.p.w. in particular explains what they knew or didn't know or did or didn't do. i don't think there's a rush on approving this settlement. it's a long process to adjust rates. more accountability and transparency on complex and disposal rates can start today. i did hear the city attorney
summary. i would ask if the proposed settlement is available in writing to the public so that can be previewed prior to submitting it to the court. >> clerk: i understand from mr. smith, there are no further callers in the queue. >> supervisor preston: seeing no more public comment. public comment is now closed. i did have a question or two. one of the callers asked about other acts. i'm curious if there's a general
relief, what's the scope of the release in the proposed settlement from the liability for other -- [indiscernible] >> this is ron flynn. the scope of the release does release on behalf of the city. all claims related to the 2017 rate application and the gifts to city employees over election and lawsuit. it does not release municipal or state law claims or liabilities for which the city attorney has lacked authority, claims of violation of criminal law. it is not about -- if it's not
relief claim related to other relationships that the city has with recology. for instance, i believe the caller was talking about a landfill agreement that was approved related to yuba city. this lawsuit does not relate to those issues. it relates to the gifts that are alleged in the complaint and the 2017 rate making process. that's what i can say. >> supervisor preston: thank you mr. flynn. i appreciate the clarification. i think it's important point for folks to understand and obviously sometimes it's a broad release and including all known and unknown claims.
i appreciate your explanation of this purpose of release. just the other -- is there anything explicit in the supplement agreement. not asking you to render advice here, is there anything explicitly in the settlement agreement that addresses impacts of the settlement on individual rate payer claims? >> i want to back up one moment. it does contain general release related to these claims. it's a broad release related to these claims. the claims that are being released are not being broadly released. it's the other claims that are not alleged that are not an
issue. it does not specifically say what is reserve on the individual claims that are individual lawsuits that relate to recology actions. this is the city and the government action. this is not a private action. even though it's on behalf of the people, the law enforcement action. that said, an impact on those claims will be that if -- if someone is damaged and they get money back that amount of money they get back is subtracted from the damage. to the extent, rate payers get refunds. they would not able to seek those same amounts in another lawsuit, that will be my understanding. they would have their own lawyers to advise them on that. that's how it works.
>> supervisor preston: thank you. unless colleagues have any further questions, i like to make a motion that we convene in closed session for items 3-13. mr. clerk, please call the roll. >> clerk: on the motion offered by chair preston that the committee convene in closed session on litigation agenda. [roll call vote] there are three ayes. >> supervisor preston: thank
you. we'll go into closed session. >> clerk: members of this committee will be leaving meeting after the closed session is concluded, the members will reconnect to this live meeting and summary of actions taken during the closed session will be reported by me. members of the public interested hearing the outcome of the litigation agenda, may remain connected to this call and await our return once closed session concludes. thank you very much.