March 12 2003

Opinion

by aaron peskin

WHATEVER YOUR OPINION of Mayor Willie Brown, it's hard to deny a grudging admiration for his unflinching political chutzpah. He shamelessly defends decisions that would easily embarrass politicians less immune to public outrage. Self-serving motivations and appearances of conflict that would cause most of us to burst into apologetic retraction find a loyal and fearless champion in this mayor.

For Brown, public service means never having to say you're sorry.

The mayor's eleventh-hour Friday-evening veto of the ordinance that my office authored to fund City Attorney Dennis Herrera's lawsuit against Tutor-Saliba Corp. is a case in point.

One of the largest, most politically connected public works construction firms in the nation, Tutor-Saliba managed construction of the international terminal and several related projects at San Francisco International Airport, winning $1 billion in business from the city based largely on its promise to jointly partner with minority-owned companies.

The city's lawsuit alleges that Tutor-Saliba never kept its promise. Instead, it engaged minority front companies while funneling white-owned subcontractors the bulk of the work and proceeds. This scheme, the City Attorney's Office charges, cheated legitimate minority contractors out of their fair share of work and defrauded a city program that has, for nearly two decades, ensured equal opportunity to businesses traditionally underrepresented in municipal bidding.

Minority-contracting fraud is only one reason for the city attorney's suit against Tutor-Saliba. The lawsuit also tackles "change-order fraud," a practice of underbidding and then overbilling that allegedly has fleeced local taxpayers of tens of millions of dollars through SFO construction overruns. Tom Bradley, the late former mayor of Los Angeles, once called company founder and president Ron Tutor a "change-order artist."

The evidence presented by the city attorney to the San Francisco Board of Supervisors illustrates a pattern of fraud similar to the schemes Tutor-Saliba carried out in its work for the Los Angeles Metropolitan Transportation Agency. When a lawsuit against the company's fraud in L.A. was filed, the court awarded the agency $60 million in damages, fees, and costs.

In order to fund the litigation, Sups. Chris Daly, Tom Ammiano, Matt Gonzalez, Jake McGoldrick, and Sophie Maxwell joined with me in sponsoring an appropriation that directs the San Francisco Airport Commission to fund the city attorney's suit with $2.5 million out of its $60 million reserve fund (which is separate and apart from the airport's $580 million annual operating budget).

To put the dollar amount in context, the appropriation is roughly equivalent to less than .05 percent of SFO's annual budget and less than what the Airport Commission will soon spend out of its reserves to subsidize the use of luggage carts in the international terminal.

Incredibly, every lawyer and elected official who has heard the evidence of City Attorney Herrera's case against Tutor-Saliba supports the suit. Mayor Brown stands alone in opposing it.

The ordinance that appropriates funds for the lawsuit was passed unanimously by the Board of Supervisors – exceedingly rare for such a high-profile measure. Yet the mayor still vetoed it. First, he argued that Herrera's lawsuit lacked evidence. Next, he claimed it held insufficient financial promise. Now, he says in his veto message that he is unhappy with the litigation's funding mechanism. He suggests funding for the lawsuit should not come from SFO's rich reserves, but rather the city's General Fund – the shrinking source of money that provides critical local services like health care and social services.

As Herrera said in a speech to the Chinese American Democratic Club only hours after the mayor's ill-advised veto, "Going after fraud is expensive. But not going after fraud is more expensive." His statement makes sense: aggressively pursuing fraud against the city sends a clear message to contractors that such behavior won't be tolerated in San Francisco. The mayor's opposition to the lawsuit shows he has little interest in sending such a message.