Affirmative Action Derailed

With Prop. 209 looming, an airport contract battle shows how S.F. has failed to keep faith with minority business

On Nov. 7, the day after receiving Williams' investigative report on B & F Concrete and Metalset, HRC Director Bamba ordered Antoniello to her office for a Nov. 12 meeting to discuss his familiarity with the two subs, and how he recruited certified MWBs to meet the affirmative action goals.

The notice came as a surprise. Remember, the HRC had certified B & F Concrete and Metalset in 1994 and 1996, respectively. To Antoniello, if the agency was looking for culprits, perhaps it should have looked in the mirror rather than at him. Moreover, the airport-based HRC staff person's memo clearing Mitsubishi had been given to airport management Sept. 18.

Bamba considered that notice invalid, however, because it had been issued without HRC front-office approval, by a junior staffer, and during a three-week window when the HRC was between permanent directors. (Ed Lee, Bamba's predecessor, had become S.F. purchaser Sept. 10.)

Bamba's come-to-Jesus meeting at the HRC office was a well-attended, tense affair.

Aside from Bamba, Williams, and Antoniello, it drew two other HRC staffers, three other figures from Mitsubishi and Sumitomo, three lawyers from City Attorney Louise Renne's office (two who work for the airport, the other for the HRC), a senior airport manager, and Mitsubishi's politically wired counsel, William Coblentz, of the law firm Coblentz Cahen McCabe & Breyer.

Williams, the HRC compliance officer, put Antoniello through the paces, as revealed by a meeting transcript.

Williams: "Where is Metalset located?"
Antoniello: "They have a small office on Michigan Street."
Williams: "What equipment does Metalset own?"

Antoniello: "They provided us with an equipment list. I would have to check it again."

Williams: "Where is everything kept?"
Antoniello: "Either at job sites or their place of business."
Williams: "Have you or anyone else visited the site?"
Antoniello: "I visited on one occasion."
Williams: "Did you see any equipment?"
Antoniello: "Some minor stuff."
Williams: "What did you see?"
Antoniello: "I don't remember exactly."
Williams: "Did you ever visit [B & F Concrete's] site?"
Antoniello: "No."
Williams: "[Were] there any other concrete firms solicited?"

Antoniello: "No." [He then explained that he left those matters to his intermediary subcontractors.]

Williams' supervisor, Zula Jones, one of the other HRC staffers in attendance, concluded the interrogation, asking Antoniello whether B & F Concrete had a business location outside San Francisco.

"I'm not sure," he said.
When the grilling concluded, Antoniello aired his dismay over the inquiry and expressed clear doubts about the propriety of the proceedings.

"We've done all that is appropriate, and it is a shock to us that we are even being questioned about our good-faith effort," he said, his frustration showing. "Some of these questions are very pointed, and we will cooperate and are cooperating, but we would like some clarification as to what this process is really trying to achieve -- and what the intended outcome is."

Responded Bamba: "There were some significant and critical issues that I felt needed to be addressed." She pledged to deliver her findings swiftly to airport management.

Under Bamba's predecessor, Ed Lee, "the HRC settled its [affirmative action] differences with other departments behind closed doors," says an S.F. lawyer familiar with the commission's practices, who spoke on condition of anonymity. "He understood how to finesse it."

But Bamba marches to a different beat. Though declining to discuss the light-rail contract, citing litigation on the matter, Bamba says she intends to bring more stringent attention to MWB contract compliance: "Consistency and enforcement of the letter of the law," as she puts it.

S.F.'s affirmative action bureaucracy got the message on Nov. 18 when she issued her Mitsubishi bid findings to S.F. Airport Director John Martin. Bamba didn't exactly go ahead and pull the trigger however. Having already gathered damning evidence that B & F Concrete and Metalset weren't legitimate local, independent MWBs, she refrained from immediately decertifying the companies. Instead, in her report to the airport, Bamba recommended rejection of Mitsubishi over a more esoteric matter. Noting that Mitsubishi was lavishing large sums on the two subs -- plus a third certified MWB with an unproven track record, Aladdin Builders -- she took issue with how the dollars would flow under the bid. Essentially, Bamba argued, the three companies were serving as "pass-throughs" or "conduits" for dollars that would actually go to non-minority equipment and materials suppliers. She concluded that the MWB credit claimed by Mitsubishi was therefore inflated.

Just six weeks on the job, Bamba couldn't have liked what she found in the light-rail contract. Were "certified" MWBs of this ilk -- essentially paper entities without a work force that had been created only to take advantage of the system -- the exception or the rule?

For Mitsubishi, the HRC director's report to the airport carried potentially grave consequences. Had she simply disqualified B & F Concrete and Metalset, the revelation presumably could not be used against Mitsubishi (absent evidence the company should have known better).

On the other hand, if Mitsubishi inflated the credit it was due under its subcontracting deals with MWBs -- and consequently was deemed to have fallen short of the affirmative action goal, as Bamba concluded -- then ADtranz would be in position to land the light-rail contract.

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