Public Corruption Scandal

Contractors Paid Into $1M Non-Profit Fund That Financed SF Public Works Parties

Financial records obtained by NBC Bay Area's Investigative Unit show the contributions were made to San Francisco Parks Alliance accounts that were controlled by high-level Public Works officials, including Mohammed Nuru.

NBC Universal, Inc.

A financial accounting obtained under the California Public Records Act shows that contractors, a non-profit, and other large firms contributed nearly $1 million over the past five years to an undisclosed fund that Public Works officials spent on everything from ballcaps to employee parties to a treadmill for the DPW operations yard.

Documents obtained by NBC Bay Area’s Investigative Unit show the fund was in the name of the San Francisco Parks Alliance, a multi-million dollar non-profit dedicated to preserving and upgrading the city’s open spaces, according to its website. The documents show, however, that former Public Works director, Mohammed Nuru, along with other DPW managers, authorized expenditures from the fund.

Nuru, who faces federal corruption charges associated with an attempted bribery of an airport commissioner, was almost never in public without his signature Public Works ballcap. An accounting of expenditures from the fund shows that over the past five years, Public Works employees and volunteer crews were outfitted with nearly a quarter of a million of ballcaps, T-shirts, bandanas and other attire.

“Ten thousand dollars for t-shirts, eight thousand plus dollars for caps, what the heck is that all about?” asked Quentin Kopp, a retired judge, former city supervisor and until last year, a city ethics commissioner.

The financial records show the fund picked up the costs for custom outfits for Black History Month and Arbor Day, nearly $10,000 for lunch bags for the employee health fair, and even special bandanas for the Bay To Breakers Race.

The cost for Public Works shirts and caps for the 2018 employee appreciation picnic alone was nearly $30,000, records show.

Much of the fund contributions came from contractors doing business with the city and the builders of DPW projects. They made checks not to the Public Works Department, but to the Parks Alliance.

The annual report reflects dozens of city beautification projects and lists hundreds of individual and corporate donors, but there’s nothing about contributions to the Public Works fund.

DPW officials now say they no longer use the fund, referring questions to the City Administrator’s office. That office declined to comment, citing the ongoing probe.

On paper, Kopps says the contributions to the fund may look like legitimate tax deductible donations to a charity, but he’s concerned about what contractors may have expected or actually got in return for their donations.

“If you are making donations in return for favorable treatment on bidding contracts issued by the Department of Public Works…it’s almost bribery,” said Kopp, who resigned his post on the ethics commission in protest last year.

While some donations reflected in the accounting clearly went to fund volunteer clean-up efforts, such as Community Clean Team events across the city, about a quarter of a million dollars went to parties, like the DPW annual employee appreciation day, and multiple holiday celebrations. The account did not just pay for parties, but also annual events like the Employee Health Fair.

The records show that $35,000 out of the fund went to a longtime friend of Nuru, Walter Wong, a permit expediter whose offices were searched during the FBI probe that led to Nuru’s arrest on corruption charges.

Wong, who did not return calls seeking comment, was paid for providing equipment for various employee gatherings.

Meanwhile, $25,000 from the fund went to pay for entry fees and t-shirts for hundreds of DPW workers to enter San Francisco’s annual cross city race --and even bought a $2,400 exercise treadmill for the Public Works  operations yard.

“It’s just outrageous,” Kopp said. “The purposes for which these donations are being used – for picnics for staff, for entry fees to the Bay to Breakers.”

“Everything about this sounds shady."

Supervisor Matt Haney

The donors include many firms responsible for DPW projects, including Webcor, the lead contractor on the expansion of the Moscone Convention Center. It gave a total of $15,000.

Clark Construction, now building the city’s new $175 million crime lab, gave about the same as Webcor.  Pankow, which is currently at work on the new $250 million building that will house the new Public Works headquarters. Pankow put up more than $10,000.

The contractors say they believed they were contributing a legitimate cause. Sam Singer, spokesman for Webcor, said the contractor believed it was financing the city’s annual Public Works week.

They each have been targeted by a subpoena from the City Attorney’s office, which is conducting an ongoing corruption probe along with the City Controller’s office.

The Parks Alliance, which has also been subpoenaed, declined to discuss the fund, citing the city’s ongoing investigation.

The contributors were not just builders, however. PG&E gave $42,000 and the Recology waste management firm contributed $132,000. PG&E said it is cooperating with the corruption probe, while Recology said only that it has regularly given to the Parks Alliance as a “champion of parks and open spaces.”

The Chinatown Neighborhood Association also shows up as a contributor to the fund. Records show the Association gave $23,000 over the past five years, which it said was to cover the costs for a local non-profit youth group to help set up barricades for the annual Chinese New Year Festival. The records reflect those expenditures made from the fund.

The largest contributor, by far, however, was the Clean City Coalition. Nuru had previously served on its board. The non-profit donated about $700,000 to the fund over five years, a period in which it reaped nearly three times that much -- $2 million – in DPW issued grants. The coalition did not respond to questions about its payments into the fund.

“Everything about this sounds shady,” said city Supervisor Matt Haney, who has pushed for an independent corruption probe.

Haney cited an authorization form, one of the documents disclosed by the city, as showing at least a half-dozen public works officials besides Nuru authorized payments.

“A lot of these other folks who were involved with this have some serious answering to do,” Haney said, “and most of them are still working for the city.”

The City Attorney’s office declined to comment on the specifics of its ongoing probe, but said in a statement:

"We are in the midst of a wide-ranging investigation that has included 24 subpoenas to date. That investigation continues, despite the pandemic, so we are not going to discuss specific details. But make no mistake, we are following the evidence wherever it leads. We're going to get to the bottom of this. The people of San Francisco deserve no less."

Kopp wonders why it took so long for someone to raise a red flag about the Parks Alliance account.

“What’s infuriating about this is,” he said, “it took some solid investigation, and not by a public employee, namely this television station to find these documents.”

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