Downtown's Fairy Godmother

Doris Ward, San Francisco's assessor, is tossing around commercial tax breaks as if they were fairy dust. It's costing the city at least $100 million a year.

By most accounts, San Francisco's tax assessor, Doris M. Ward, is a nice person. When asked about Ward's good qualities, people who work with her talk about the regular birthday parties she throws for her staff. Or they say she is "charming." Or they describe her as "nice." And the good feelings extend beyond the Assessor's Office.

Millionaire hotel owner and author (Christ Was an Ad-Man) Robert Pritikin likes Ward, too. Early last month, he threw a campaign kickoff party for her at his San Francisco mansion, which sports plush conversation pits -- and a marble swimming pool -- in the living room. Amid tables spread with white linen and salmon canapes, Ward held court, pressing the flesh of the politically connected and seeking re-election as assessor.

"Welcome to Doris' party," said Pritikin, white-haired and dandy, again and again as he shook the hands of his guests. And the guest list was impressive: Mayor Willie Brown and his bodyguard showed up. District Attorney Terence Hallinan, Assemblyman Kevin Shelley, and assorted supervisors and city department heads paid their respects. In fact, Pritikin, Brown, U.S. Sen. Dianne Feinstein, and real-estate tycoon Walter Shorenstein -- the leading sponsors of Ward's re-election campaign -- have helped create what appears to be one of the more outlandishly one-sided political contests in recent San Francisco memory.

Ward's opponent, a virtual unknown named Fred Perez, has worked as a personal property auditor at the Office of the Assessor for two decades. He has been able to raise little money for or interest in his campaign. And even he admits to liking Ward as a person.

"She is nice," Perez says, "but incompetent. Everybody knows it."
Actually, Perez's assessment is incorrect.
Doris Ward may be a pleasant person, but to call her incompetent is to understate magnificently. By numerous official estimations, in many measurable ways, under the most charitable and evenhanded of judgments, Doris Ward qualifies as a top contender for the title of most inept and costly official in San Francisco government.

A county assessor's job is to appraise -- that is, to declare the taxable value of -- every parcel of land, piece of business equipment, and type of building in the county. That taxable value determines, to a large degree, how much money city government has to spend each year. If you take the taxable value of all the property in the City and County of San Francisco -- $53.5 billion -- and multiply it by the city's tax rate, you calculate the amount of property taxes that will be collected annually from home and business owners.

This year, that figure was about $671 million, or 20 percent of the city's operating budget. To say that the tax assessor's job is important to the financing of city government is, then, to state the obvious. Increases or decreases in assessed value directly affect what programs the government can fund, and at what levels.

And, indeed, Doris Ward has been important to San Francisco's finances -- negatively important.

Calculations based on public records show that the city lost more than $100 million in tax revenue this year -- and roughly half a billion tax dollars since 1992 -- because Ward's office failed to accurately value commercial real estate, including numerous downtown skyscrapers owned by politically influential people and businesses.

Also, public records show, the assessor is notoriously lax in visiting businesses to identify the large amounts of taxable office equipment and furnishings located there. And government auditors have regularly criticized the assessor for failing to log newly constructed buildings and additions to existing structures. This new property is added to the assessment roll years late, if at all, the auditors say.

Due in large part to the policies of Ward, the total assessed value of San Francisco's commercial property has shrunk since she was appointed to office in 1992 after then-Assessor Richard Hongisto left the post to become chief of police.

To put it another way: If you believe that Doris Ward's office is producing accurate property assessments, you also must believe that San Francisco -- now in an almost unprecedented economic boom -- is actually suffering a cataclysmic recession, an economic downturn so drastic that the price of real estate is falling.

Records provided by Ward's office show that her policies kept at least $100 million out of city coffers this year, and consequently left that money in private hands. And the list of those who reaped significant benefits from undervaluation of commercial property includes some interesting names:

* Walter Shorenstein, who is estimated to own roughly one-quarter of downtown San Francisco and is a national-level player in Democratic Party fund-raising.

* The Catellus Corp., a major owner-developer of real estate in San Francisco and California. Until he became mayor, Willie Brown represented Catellus as an attorney.

* The Bank of America, which owns sites of branch banks and holds mortgages on billions in S.F. real estate. Its corporate headquarters at 555 California St. has a market value estimated at more than $1 billion.

Then there are the people Doris Ward's policies have helped on a smaller scale. People like Robert Pritikin and Willie Brown.

Generally in line with -- but a bit behind -- the fortunes of the national economy, the San Francisco real estate market sank and bottomed out in the early 1990s. Although it seems hard to imagine now, then there was an oversupply of downtown office space; even the residential market went soft. When the real estate market goes down, a state law adopted in 1978 allows tax assessors to temporarily reduce the values on residential and commercial properties, which ordinarily are revalued only when they are remodeled or ownership is transferred or sold.

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