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A Glimmer of Hope 

In the city of sleaze, someone's finally doing something about SFO's shady little side business

Wednesday, Jul 16 2003
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For a good long time now, the defining features of San Francisco's political culture have been a public focus on progressive symbolism and an underlying reality of sleaze and impunity. City supervisors furiously denounce trade with Burma; down the hall, other officials snicker as they loot the public till, knowing no one will do anything about it.

Leaving aside for the moment the special case of Willie Brown, the champion in the local arrogance and impunity competition is, in my educated opinion, John Martin, director of the San Francisco International Airport. Unfortunately, my most current Martin-the-arrogant-jerk story involves a public records request, the details of which are bound to be complicated and tiresome.

But I'll try to summarize maximally, and if you make it through the story, you'll be one of the first to understand why Martin's days of impunity may actually be numbered, and why now -- for the first time in a good long time -- there's a tiny reason to have some small hope for the possibility that impropriety might sometime be less prevalent at San Francisco City Hall.


SF Weekly news columnist Matt Smith has won significant acclaim for his writings on SFO Enterprises Inc., a shady, supposedly private, for-profit corporation that helps manage Honduras' national airports. Why ever in hell, you ask, is the city involved in Honduran airports? Well, that's a boffo question, but one I don't have space to answer here. Let's just say that the city created a shady little company that bears, to my jaundiced eye, a remarkable resemblance to a slush fund for airport managers; the company joined a consortium that obtained airport business in Honduras. The Honduran government is now quite unhappy with the consortium's performance.

The general thrust of Mr. Smith's reportage has been to question the claim by San Francisco International Airport managers that SFO Enterprises is an entity entirely apart from the city government. He has shown that the airport, despite assurances it would contribute nothing beyond $10,000 in start-up capital, has dumped wheelbarrows full of public money into this suspicious firm -- hundreds of thousands of dollars, at a minimum. This May, Mr. Smith established that Martin had been lobbying members of the Board of Supervisors, asking them to fund SFO Enterprises in the coming budget year to the tune of yet another $220,000. If the money wasn't provided, Martin contended, the city might be sued by the government of Honduras over the airport contract that SFO Enterprises is helping to administer.

In other words, Martin himself told supervisors that SFO Enterprises is not actually separate from city government, that SFO Enterprises' activities could create -- in fact, probably had created -- legal liability for the city.

A few months back, Smith sent the airport a request for, among other things, documents about SFO Enterprises. In their response to the request, airport underlings underscored the linkage between the airport, which is a city agency, and SFO Enterprises. Although it refused to provide the requested records, the airport did let Mr. Smith photocopy other documents, and gave him an invoice when he paid for the copies.

The invoice for city records was typed on letterhead of -- you guessed it -- SFO Enterprises Inc., "An affiliate of San Francisco International Airport." Mr. Smith was told, by an airport (that is, a city) employee, to make out his payment for these city records provided by the city government to "SFO Enterprises Inc." His check to SFO Enterprises was, in turn, deposited in a city government bank account -- establishing, for any reasonable mind, that SFO Enterprises and San Francisco International Airport are part and parcel of the same thing, and that SFO Enterprises is a subunit, of some sort, of the city of San Francisco.

I wrote to one of Martin's minions, giving all the reasons why SFO Enterprises simply, absolutely, obviously was a part of city government, and so had to turn over its records under the Public Records Act, because that's what the law says. The case was overwhelming; I specifically noted that Smith's check to SFO Enterprises had been deposited in a city government account.

John Martin himself wrote back, again refusing to hand over the obviously public documents, and here is the part of his letter that denies reality with such easy aplomb that it wins him my first-place vote in the local arrogance and impunity competition:

"Finally," Martin wrote, "thank you for advising us that Mr. Smith erroneously listed "SFO Enterprises Inc.' instead of "SFO' as the payee on his May 17, 2003 personal check. ... The $92.90 in copying costs he paid was due to the City and County of San Francisco. Therefore, payment was properly credited to the City's account."


A few weeks ago, I saw Supervisor Aaron Peskin, who has been at loggerheads with airport managers over a variety of issues; I asked him how he was enjoying his dealings with Martin and his underlings at SFO. Peskin paused.

"It's like picking up shards of glass," he said.

Then he paused again, and amended his statement:

"It's like having Colonel North down in the basement."

Peskin is far from alone in his low regard for and suspicion of the current administration of San Francisco International Airport. Several sources I spoke with recently used phrases like "off the reservation" and "rogue agency" when asked about the airport. There is nothing particularly new or interesting about these opinions; a lot of people have thought a lot of city agencies are sleazy and unaccountable for a long time. Those thoughts haven't mattered, because there have been no systems of checks or balances whatsoever against improper behavior. In San Francisco, the Democratic machine ruled, and nobody was ever goin' to be doing nothin' about nothin', because in San Francisco, if the public till was being rifled, a Democratic hand was probably involved.

But there is something new in the world of John Martin, and San Francisco International Airport, and SFO Enterprises Inc. For the first time in a long time, someone in a position to do something official has decided, in the face of apparent impropriety, to ... well, to do something. Officially.

Last week, the Budget Committee of the Board of Supervisors voted to shut down SFO Enterprises by the end of the year, and to authorize City Controller Ed Harrington to audit the "company." Both Harrington and Peskin say they hope and believe the airport will hand over SFO Enterprises' financial books voluntarily, but they intend to get the records, regardless -- if necessary, by having the Board of Supervisors issue a subpoena.

As I write this column, the budget authorization for the shutdown and auditing of SFO Enterprises still has to be approved by the full Board of Supervisors. Martin and his cadre of airport managers could, I suppose, try to delay or stymie the attempt to uncover the reality of SFO Enterprises in any number of ways.

But I feel certain that City Attorney Dennis Herrera, who has already taken great political risks to investigate allegations of contract fraud at the airport, stands ready to help, if there are difficulties in obtaining records relating to a shady little company that has soaked up an awful lot of public money, and produced very little except suspicion.

In any other major American city, authorization of the audit of an entity funded by city government would be routine; in San Francisco, it represents fundamental change that threatens the easy sleaze of the status quo. Forcing this type of change is hard and politically dangerous, and the people who make it happen ought to be rewarded. Next time you run into Aaron Peskin or Dennis Herrera or Ed Harrington, you might say thanks. Or, more to the point, keep up the good work.

About The Author

John Mecklin

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