Cracking Contracting Shell Games
Four months after uncovering affirmative action fraud in bidding on construction at S.F. International Airport, the city has booted the two offending firms from its minority contracting program. The investigation also shows that the S.F. Human Rights Commission (HRC), which certifies minority firms for city affirmative action efforts, clearly needs to do some housekeeping of its own. And it raises questions about just how many bogus minority contractors are doing work for the city.
Metalset Inc. -- once poised to win $5 million of a $136 million contract to build the airport's new light-rail train system -- is, in fact, nothing more than a two-man outfit, according to the Human Rights Commission. It apparently never operated a true business facility in S.F., as required, and merely brokered work for other firms, a violation of city law.
B&F Concrete Contractors Inc. stood to take down more than $4 million on the same airport job. But the Human Rights Commission concluded that the company simply funneled contracts to Casey Fagoli Concrete Contractors, a large, white-owned East Bay outfit.
In separate Feb. 28 letters to the two companies, Human Rights Commission Director Marvic Bamba notified them that they had been dropped from the affirmative action program and that they could face civil penalties if their conduct is found to have been "willful" or carried out in "bad faith."
Due in part to Bamba's misgivings about Metalset and B&F Concrete, an S.F. judge last month blocked the city Airport Commission's award of the $136 million rail contract to Mitsubishi Heavy Industries, which had hired Metalset and B&F as minority subcontractors. Mitsubishi has appealed that ruling.
The Human Rights Commission's investigation of the two subcontractors turned up some embarrassing slips by the agency itself. Last year, Metalset landed a $250,000 airport deal as a minority contractor, with no questions asked. Furthering the appearance of fraud, the company passed along all but $40,000 to a white-owned Sacramento company that actually performed the work.
B&F Concrete, unbeknownst to the HRC, had recently been dropped from the city Redevelopment Agency's affirmative action program. B&F, the agency had concluded, appeared to be nothing more than a conduit for white-owned Casey Fagoli.
With so many shell games going on, city watchdogs need to start doing a better job of keeping an eye on the pea.
In 1996, political newcomer Victor Marquez, director of La Raza Centro Legal, ran an inspired campaign for San Francisco supervisor. He finished just out of the money, while remaining independent of Mayor Willie Brown and the local Democratic establishment.
Marquez now has undertaken a bid to topple mayoral aide David Serrano Sewell as head of the Latino Democratic Club. Again, Marquez is pitching himself as a breath of fresh air. But he has some explaining to do. A few weeks back, Marquez called a Brown appointee to the Transportation Commission, Dennis Herrera, offering to pull out of the club race in exchange for a seat on the powerful Redevelopment Commission.
The Brown camp didn't bite. The club election is March 20. Serrano Sewell, a staunch Brown loyalist, is expected to hold his post. As air goes, Marquez's is starting to smell a little stale.