Government Audit and Oversight Committee Regular Meeting: December 7, 2023
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Government Audit and Oversight Committee Regular Meeting: December 7, 2023
The Government Audit and Oversight Committee of the San Francisco Board of Supervisors met on December 7, 2023, at 6:15 PM UTC to consider six agenda items. The meeting included hearings on two civil grand jury reports addressing the city's hiring crisis and homelessness services contracting, approval of two Mills Act historical property contracts, a new contract for homeless outreach services, and a long-term lease for a temporary shelter site. The committee filed both civil grand jury reports and forwarded the remaining items to the full Board of Supervisors with positive recommendations.
Public Comments & Testimony
- Item 1 (Hiring Crisis): Umar Fall, SEIU Field Director, expressed support for the civil grand jury's recommendations but emphasized that the hiring process remains too long, with many steps and lack of communication to applicants. He urged the city to become a better employer beyond relying on pensions.
- Item 2 (Homelessness Contracts): Michael Corboy (D2 resident) urged the city performance scorecard to include subpopulation data so citizens can evaluate how $1.7 billion in nonprofit spending is used effectively.
- Item 6 (Jerrold Avenue Lease): Michael Helby, property manager and co-chair of the Market Zone Working Group, requested that the shelter prioritize unhoused individuals from the immediate district, improve lighting and cleanliness on surrounding streets, and provide community ambassadors and adequate police presence. He asked that the community stakeholder group continue to be involved in planning.
Discussion Items
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Item 1: Civil Grand Jury Report – "Time to Get to Work: San Francisco's Hiring Crisis" (Hearing)
- Civil Grand Jury Presentation: Marvin Norman presented eight findings and 17 recommendations. Key areas: 60-day hiring timeline goal, better anticipation of employee separations, faster post-referral process, reduction of job classifications, collaboration with unions on recruitment and retention, and public dashboards. The jury noted that city departments agreed with findings 1 and 2 (vacancy rates negatively impact services; hiring takes too long) but partially disagreed with six others, though many responses indicated implementation plans. Three findings (2, 5, 6) require follow-up.
- Department of Human Resources Response: Director Carol Ison reported that vacancy rates have dropped from 14% to 10.2% (permanent full-time), time to fill permanent civil service positions decreased from 255 to 197 days, and applications increased 46% year-over-year with 500 additional offers in process. She highlighted civil service reform efforts, including moving to online on-demand exams, improving candidate communication via Smart Recruiters, and launching a public people analytics dashboard within six months. DHR is also working with the Civil Service Commission to revise rules and with unions on retention and succession.
- Discussion: Supervisor Chan asked about candidate communication; DHR noted automated notifications are expanding but standardized timelines for applicants are not yet in place. Supervisor Preston asked about a public dashboard; DHR committed to providing one within six months. He also questioned the 5-day mayoral approval timeline for hiring requests; DHR explained that the current process is required due to the city's financial outlook, and that a smaller number of positions have deemed-approved status. The committee filed the report.
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Item 2: Civil Grand Jury Report – "Hitting the Performance Bullseye: Contracting for Better Outcomes in Homelessness Services" (Hearing)
- Civil Grand Jury Presentation: Rick Ulrich presented findings that HSH contracts inconsistently use outcome-based metrics, on-site monitoring is insufficient, and the city performance scorecard does not adequately report on subpopulations (e.g., chronically homeless, racial/ethnic groups). He recommended HSH develop standardized performance measures linked to the strategic plan, improve monitoring, and enhance public reporting. The jury noted that HSH agreed with most findings but disagreed that the scorecard is the appropriate place for subpopulation data.
- HSH Response: Deputy Director Emily Cohen stated that HSH generally agrees with the findings and is implementing a performance management plan aligned with the new five-year strategic plan "Home by the Bay." Key actions: consolidating data systems into a single system, standardizing metrics across agreements, and developing annual program monitoring policies. HSH will also work with the controller's office on citywide fiscal monitoring.
- Discussion: Supervisor Chan raised concerns about HSH's sole-source contracting authority, noting that the mayor proposed extending it for another five years. She argued that sole-source procurement undermines performance-based contracting. Vice Chair Stephanie noted that she has introduced legislation to standardize performance measurement and monitoring, which was sent back to committee for further input from nonprofits. The committee filed the report.
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Items 3 & 4: Mills Act Historical Property Contracts (Resolutions)
- Presentation: Shannon Ferguson (Planning) and Elizabeth Gordon Junk (Preservation Manager) presented two contracts: (1) 988 Market Street (Warfield Building) – conversion of office to 45 residential units, with $576,259 in rehabilitation costs and $20,000 annual maintenance, estimated tax savings of $176,681 per year; (2) 2209 Webster Street – single-family Victorian home converted from medical office, with $238,000 rehabilitation and $3,800 annual maintenance, estimated tax savings of $17,817 per year. The Historic Preservation Commission recommended approval. Planning is conducting an audit of the Mills Act program and will present policy recommendations in January 2024.
- Property Owner Testimony: Michael Foley and Chiao Men Li (owners of 2209 Webster) described their commitment to restoring the historic home and raising their children there. They noted the building had been abandoned for 30 years and is architecturally significant.
- Discussion: Chair Preston questioned the program's value, noting that the 988 Market Street property receives a large tax savings relative to its investment ($576K investment vs. $2M estimated savings over 10 years). He and Supervisor Chan expressed concerns about the program's equity, especially during budget deficits, and the need for stronger historical significance criteria. They noted that Supervisor Peskin plans to introduce legislation to put these contracts into non-renewal status after 10 years, phasing out over 20 years. The committee sent both items to the full board with positive recommendation.
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Item 5: Contract with Heluna Health for Homeless Outreach Team (HOT) (Resolution)
- Presentation: Deputy Director Emily Cohen and BLA Nick Menard described a new 3.5-year contract (Jan 2024 – June 2027) with Heluna Health for $36.9 million to provide street outreach and case management. The contract includes 76 FTEs (4.2 increase), a subcontract with Code Tenderloin for backup staffing, and a focus on filling staffing gaps. The BLA noted that the program costs about $9.2 million per year, 77% funded by the general fund. A small portion ($325,000/year) from Recreation and Parks for outreach in Golden Gate Park and Buena Vista Park is on the mayor's mid-year cut list.
- Discussion: Supervisor Chan asked about response times; Cohen clarified that HOT is not an on-demand service but does beat-based outreach. The city's HERT team handles complaint-driven responses. Chair Preston asked about coordination with the upcoming street teams audit; Cohen confirmed the contract is flexible enough to adjust operations. The committee sent the item to the full board.
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Item 6: Lease for 2177 Jerrold Avenue – Temporary Shelter Program (Resolution)
- Presentation: Deputy Director Cohen proposed a 15-year lease (with two 5-year options) for a hybrid shelter with 60 cabins and 20 safe parking spaces. Annual base rent: $2.5 million, tenant improvements: $8.6 million (city share), total cost over 15 years: $44 million in rent, plus $2.5 million for utilities and taxes. The program will serve the immediate District 10 area, which has 25% of the city's unsheltered population and 50% of inhabited vehicles. The cost per slot is estimated at $90,000 per year (including services) or $201 per guest per night (lease and services). The site can expand to 200-250 cabins if funding becomes available.
- Discussion: Supervisor Chan asked about length of stay; Cohen noted average stays are 90 days to 6 months, with no arbitrary limit. She clarified that the housing placement responsibility lies with the coordinated entry system, not solely the shelter provider. Chair Preston questioned whether the city analyzed purchase versus lease; Cohen stated the property was not for sale and the city lacks shelter acquisition funds, but the lease includes an option to purchase. The committee sent the item to the full board.
Key Outcomes
- Item 1: Motion to file the civil grand jury report passed unanimously (Preston, Chan, Stefani).
- Item 2: Motion to file the civil grand jury report passed unanimously.
- Items 3 & 4: Motion to send both Mills Act resolutions to the full board with positive recommendation passed unanimously.
- Item 5: Motion to send the Heluna Health contract resolution to the full board with positive recommendation passed (Preston, Chan; Stefani absent).
- Item 6: Motion to send the Jerrold Avenue lease resolution to the full board with positive recommendation passed (Preston, Chan; Stefani excused).
- The committee also voted to excuse Vice Chair Stefani from the remainder of the meeting.
Meeting Transcript
7th, 2023 regular meeting of the government audit and uh oversight committee of the San Francisco Board of Supervisors. I'm Supervisor Dean Preston, Chair of the Committee. I'm here with Vice Chair Catherine Stephanie and Supervisor Connie Chan, our committee clerk today is Victor Young, and our thanks to SFGov TV for staffing this meeting. Mr. Clerk, do we have any announcements? Yes. Public comment will be taken on each item on this agenda when your item of interest comes up and public comment is called. Please let him speak on your right. Alternatively, you may submit public comment in writing in either of the following ways. Email them to uh Alisa Samira, uh, the government audit and oversight committee clerk at ALISA. S O M E R A at SFgov.org. If you submit public comment via email, it will be included as part of the file. You may also send written comment via US mail to our office and City Hall 1, Dr. Carlton B. Goodlit Place, Room 244, San Francisco, California 94102. Please make sure to silence all cell phones and electronic devices. Documents to be included as part of the file should be submitted to the clerk. Items acted upon today will be are expected to appear on the Board of Supervisors agenda on January 9, 2024, unless otherwise stated. That completes my initial announcements. Thank you, Mr. Clerk, and please call item one. Item number one is a hearing on the 2022-2023 civil grand jury report entitled Time to Get to Work, San Francisco's Hiring Crisis. Thank you, Mr. Clerk. And today we will be uh hearing our last two uh civil grand jury reports for the year. I want to welcome uh all of uh today's uh jurors, uh some of whom I know are here uh and uh and the departments and thank them all for being here. Um for those who uh did not tune in to our discussion of the other uh civil grand jury reports um last month um uh they everyone should know that each year civil grand jury investigates and uh scrutinizes our city's conduct of public business and makes findings and recommendations to city entities which in turn have the opportunity to engage with those findings and respond to those recommendations. Um the two civil grand jury reports um concern that we'll be talking about today, um concern issues that we uh often have uh here at the Board of Supervisors, specifically that's uh city hiring and vacancies, which we'll be hearing about first as this first item, uh then we will be calling the second item, which deals uh with homelessness services in our city. Uh there's no question that both of these issues are extremely important topics uh for our city's functioning and quality of life for residents here. Um, and it is uh completely understandable why members of the public want to learn more about what the city is doing and how we can improve, and I think these grand jury reports are extremely helpful as we work toward uh those shared objectives. So I'm looking forward to the discussion on both these reports today regarding the report that has been called Agenda Item One Time to Get to Work. Um I will just note that the uh civil grand jury correctly, in my opinion, underscored the reality that vacant positions can have a significant impact on our city's ability to deliver crucial services to our residents. I know that will be part of the presentation and is outlined in detail on the reports, and I encourage anyone who has not yet seen the report uh to access it on the city's uh website. Um we need to make sure we're able to hire good candidates for these positions and not to lose them before they ever make it in the door as a result of extensive hiring delays, uh which are outlined in a key part of the report. So I will let the civil grand jury speak uh for themselves and uh with that want to welcome uh the four-person uh pro tem Stan Feinsod to say a few words uh about civil grand jury and introduce uh their presenter for this report. Thank you very much, Supervisor Preston. Good morning. It is an honor to come before the government audit and oversight committee of the Board of Supervisors, representing the 2022-2023 San Francisco Civil Grand Jury. I'm going to introduce civil grand jury reports, time to get to work, and hitting the performance bullseye. Your committee reviewed our other two reports on November 2nd. On that day, you heard about our teachers and small business reports not making the grade and taking care of business. My name is Stan Feinsod. I served as the four-person pro tem during the term of this civil grand jury, which ended on June 30th, 2023. I was the backup, the assistant to Karen Cannard, the four-person, as assisted her as she performed her duties. She was an outstanding four-person. To remind you, our civil grand jury began its work on July 1st, 2022. It consisted of 19 voluntary members serving a one-year term with a mission to choose and investigate elements of the city and county of San Francisco government operations and make recommendations for improvement. We completed our term on June 30th, 2023. The jury adopted rules, selected officers, and created and implemented a process of choosing specific agencies and processes to investigate. We started with over 50 ideas and finally decided on five specific areas, which ended up with four published reports.
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