Here's Why Money Doesn't Fix San Francisco's Problems, Former Supervisor Explains | Tony Hall

All of our problems in the city and county of San Francisco, they're man-made. There's people making money on the homeless problem the way it is today. We've had almost 5,000 different non-profits doing business with the city and county of San Francisco. They're non-profits by law, but they're making money. They're delivering services. The problem is there's no monitoring of those services. The city has been mismanaged, mismanaged. We are spending far in excess of $100,000 per homeless person. Some of that money finds its way back to the elected officials in campaign donations, and that's the problem. Hello and welcome to Bay Area Innovators. I'm your host, Steve Esposito. Today we are joined by Tony Hall, a former San Francisco supervisor, as well as a mayoral candidate in 2011. He's also been in seven different departments within the city, as well as in all three branches of government, judicial, executive, and legislative. Tony, welcome to our program. Steve, thank you. Bay Area Innovators. I love the title, and thank you for what you do to bring truth and light to the Bay Area. Appreciate it. Thank you. Well, first I want to ask you about budgets. We've been talking about how San Francisco's budget is about $14 billion. You have experience with different budgets in different organizations that you've been across. A city similar to San Francisco, which is San Jose, is $3 billion budget. Why such a big difference? It's got the highest budget per capita of any city in the world. It's five times bigger than when I was on the Board of Supervisors 20 years ago. It was then about a little less than $3 billion. Now it's close to $15 billion. It's like $14.8 billion a year for less people now than were in San Francisco 20 years ago. It was closer to $850,000. And you had about half a million to a million coming in during the day to work there. Now you've probably got $200,000 to $300,000. So you're servicing less people, basic city services going out to less people with five times the budget. It doesn't make any sense. And that's the problem today. There's an awful lot of money. In San Francisco that's being mismanaged in delivering basic city services. What's the explanation of the city leaders for such a big difference in the budget? Well, they'll tell you it's because the people need this and the people need that. I mean, the purpose of city government, as you know, municipal government all over the world, anywhere in the world, is to deliver basic city services. Those services which the private sector cannot do. Roads, police, safety, fire, anything that the private sector can't do. The function of the city is to deliver those services in the most efficient and best way for the constituents, for the people that live there. Since the middle 90s, the city started using non-profits. Non-profits came into existence to deliver city services. So rather than have a selected or a designated city department deliver services in a certain aspect of the community, they contract with non-profits. Since that time, since the late 90s, there's been almost 5,000 different non-profit organizations that have contracted with the city. The problem is there's no monitoring those non-profits for their profitability, if you understand what I'm saying. They're not really non-profit. Yeah, they're non-profits by law, but they're making money. They're delivering services. The problem is there's no monitoring of those services. The controller would tell you they're monitoring, but they don't have the staff to do it, nor do they have the expertise. If certain non-profits are assigned to city departments like Public Works or the Department of Homelessness or Social Services, who is monitoring the activity of the non-profit? Certainly not the department as they don't have the expertise. So let me put it a different way, Steve, if I can. The art of public administration, that was a profession, a very sought-after profession up until the middle 90s is gone. There is no more public administration. They think it is, but they don't know how to administrate the services themselves. They contract it out to non-profits who charge for that service. And therefore, our budget has grown exponentially, if that's the right term, over the years to five times what it was then to deliver the same services. Granted, we have more homeless. That's questionable now than we did then. That's questionable depending upon who's doing the count. But we are now spending hard and soft, total about $2 billion a year for homeless services, where when I was on the board, it was about $200 million. So there's a whole, it's a whole different way. The city government has taken the role of doing everything for everybody. And it's costing money. Let's go back to the non-profits for a minute. So why did they get started? What was the main reason to use a non-profit service versus the city service? If you go back to the early days, Steve, you had faith-based organizations delivering services to the poverty people, to the homeless people, charity, different faith-based charities were in that field. We should have funded them because they knew what they were doing. They were set up to deliver those services. They were excluded because of their affiliation to a religion or a way of life that certain people in government said, no, we can't do that. It has to be totally neutral. We're going to do it ourselves. So non-profits sprung up and they made proposals to deliver those services and the city bought into it. So you have what was once being done by the private sector now being done by the public sector, except it's costing a lot more to do it. They're employed. These are non-profits that are employed by the city to deliver those services per head. Before it was the private sector, they relied a lot on charity, on people donating to them and certain monies from the city. But you had departments that actually delivered the services and those department heads were held accountable by the mayor to the public for how they performed. That's not the case now. Instead of the department head delivering the services with his workers, the non-profit is there delivering the services and there's no one asking them to be held accountable. Of course, the price is going to go up. So there's no agency that would regulate the non-profits? They will tell you that the controller's office is doing it. It's not doing it. They will tell you that there's different personnel in the mayor's office and general services that are monitoring these non-profits. They're not being monitored. Contracts are being issued and that's the end of it. Some of them are doing good work. I'm not casting dispersions on the non-profit world. I'm just saying that most of the services now being delivered by the city are not by city workers held accountable to department heads and the mayor. They are services being provided by non-profits who are accountable to no one. They may be delivering bona fide services. Give you an example. The mayor just signed a two-year, $6 million a year contract with Urban Alchemy that is a group of people who were incarcerated. They're now employed to act as security guards on the street in troubled areas like the Tenderloin. Not only security to help out with the people's needs in those areas. Well, I would have much rather seen that money going into making the police department old rather than, you know, a semi-neighborhood watchdog group unprepared to handle what the police could handle. Why didn't that money go in making the police department whole? Of course, this came off the mayor defunding the police department and the fire department by $120 million. So it's what replaced true police work. Is it police work? No. It's another non-profit. And this has gone across, this mentality has spread across the United States. The non-profits need to be held accountable for the money they're being given, the contracts they're signing, and the services they're delivering. They have to be held accountable. Which is not happening now. Which is not happening. It's not happening now. They will tell you it is, but it can't be. Why are the services that are being delivered to the people of the city and county of San Francisco costing five times more for less people? Why is the police department down the numbers it is? Why is it costing so much to provide? I would say, again, depending upon who's doing the count, that we are spending far in excess of $100,000 per homeless person to deliver benefits to them in San Francisco. Far in excess of $100,000 per homeless person. That is crazy. You know, to me it is. I mean, there's a way about going about helping these people with compassion. And that's what the ultimate goal is. But it's not to just keep perpetuating the problem by putting more money into it when it's not working. Please talk to us a bit about the non-profits and how the flow of money goes. Well, that's an interesting question because normally when you do things like defund the police $120 million or you sign a contract for $50 million or $60 million or $6 or $7 or $12 million, you as an elected official like to think you have the concerns of the people that live there with you. You normally go out. That's not happening today. They just automatically decide we're going to use this non-profit. Not even the commissions of departments are consulted. It comes out of the mayor's office. Different elected officials say this non-profit can do this. They're going to charge so much. There's no vetting process. They're selected and that's it. And where does the money go? It goes into the non-profits who then turn around and claim that they deliver the services. Of course, the administrative costs and non-profits is, I would say, far in excess of what private enterprise would charge for the same service. The administrative costs and non-profits is where the money is going. Ultimately, ultimately, some of that money finds its way back to the elected officials in campaign donations and that's the problem. That's where corruption sets in. As I said, we had, since the non-profit world sprung into existence in the late 90s, we've had almost 5,000 different non-profits doing business with the city and county of San Francisco. I can guarantee you during campaign season, during election season, a lot of those non-profits are making the maximum donation to the politician that hired them. Is that something that could be investigated? Well, yeah, it's something that should be investigated. The FBI is the only people that seem to be investigating corruption in San Francisco. The last eight people that have been tried, if you will, or singled out for corruption all came from the FBI, the federal authorities. We don't have anybody in the city that's interested in investigating corruption. We don't have anybody in the city that's interested in investigating the profits that the non-profits are making. They're probably in on it. I'm not here to be negative and that's not negative at all, but yeah. Yeah, of course. I mean, to be honest with you, yes. It's not looking at anything negatively, Steve. You have to look at something as it really is in order to make improvements. If we're going to make the city whole, if we're going to get the city turned around in the direction of where it should be, servicing the people that live there, handling their tax monies correctly, we have to be honest with ourselves about what's going on. If we're going to do anything for the homeless, you have to be honest about the right way to go about it. It's not just throwing money at it. It's breaking the problem down. I've talked about that on other shows, but there's a way to go about that that is correctable. All of our problems in the city and county of San Francisco, they're man-made. This didn't happen by coincidence. These are man-made problems. The city has been mismanaged. Mismanaged. We've made bad decisions. People have made bad decisions. Therefore, you've got a city that's not functioning properly. Now, they're going through a current PR program. I think they just spent $4.6 million to build up the image of the city. Is that really solving the problem? Is that really solving today's problems? You have APEC in town right now. Moving the people, the homeless camps around, cleaning up the streets, putting barricades where people can't go. Is that really solving the problem? They don't want the APEC people coming in here to see San Francisco for what it is. What they should do is take them down Sutter Street. The greatest shopping center in the United States was Union Square, traditionally. Not anymore. Take them down Sutter Street by Union Square. You'll find out that 80% of the shops are boarded up. Walgreens just announced yesterday on Sutter and Powell. Who would have thought 10 years ago that the prime location for Walgreens would be closed in the heart of the shopping center of San Francisco that traditionally was world-known, world-famous? Closing. They can't stay open because of crime. The Union Square is closed up. Go down and look at it. They're not going to show that to these APEC leaders. They got it all blocked off. They're going to show them things that look good. But take a look at our world-class shopping center. I want to talk to you about values next. Values. Sure. You've been involved in public service for many years. Talk to us a little bit the importance of values and what the values were like 20 years ago and how it changed and how we can bring it back. Well, and I'm not saying let's go back to the old days. San Francisco's always had a little corruption to it, a little this and a little that. It's always been a city that hasn't always been above board. But values are different. The basic values are different. People that went into public service before 2000, up to the 60s, 70s, 80s, 90s, basically had the welfare, the concern of the people that live in the city at heart. They basically tended to the people's needs. That day is gone. There's one value that went right out the window. Now the people that go in public service, people that are elected the board of supervisors, the mayor's office, whatever, people go to the state senate, they're in it for themselves. They're in it to create these feel-good programs that get them re-elected so they can go on to the next perch in the political ladder. That's all they're in it for. That's one big value that's changed. I can't name an elected supervisor or an elected official right now. Well, there's one or two that I can say are concerned about the constituents' values. But no, that's changed. They're all in it for themselves. They're in it for themselves and therefore these programs that they devise, they don't know about true public administration. None of them studied public administration in college. They were either lawyers or social workers or whatever. They know nothing about it. That's another value, the art of public administration, the art of managing a public department with public funds, the fiduciary responsibility that you have for the people that are paying the bill, that's gone. That whole field of study is gone. I don't even know if it's studied in college anymore, the art of public administration. These people know nothing about it. So that value has changed. The value of your neighbor's well-being, I mean, who talks about that anymore? San Francisco, you got neighbors that don't even know who their neighbors are. You know, and when I first started work in San Francisco, you knew everybody, whether you agreed with them politically or not. There was a happiness. There was a brotherly, sisterly type of concern about your community. That doesn't exist anymore. The faith-based organizations that looked after unwed mothers and the poverty-stricken in certain parts, they're all gone. Not all of them. A few of them are still around. But there was hundreds of those organizations. They're gone because they're not receiving the funds to keep the business. The city is ignoring them. The values have changed. We've become less people-oriented and more into whatever makes your boat float. You know, it's a different way of life. Let's look after number one now. Do you think that can come back? Oh, yeah, sure. Sure, it can. Of course, it can. Again, it's a man-made problem. If you get enough people in there that get enough people on the board of supervisors to say, look, we've got a piece of legislation in front of us. How does this affect the people, the taxpayers, or the people who live in this city? I tried that a couple of times when I was on the board. I got two or three guys to go along with me on most things, most of them. They didn't know what I was talking about. They haven't a clue. Why are you worried about how it affects? We've got to get this passed for our own welfare. That can change. You start electing people that care about the people they represent, and it'll change. You get five or six people on this board. That's what the city needs. It needs a new board of supervisors. It needs an entire new slate, if you will, of people that actually care about the welfare of the city, the city being the people that live there. If you get supervisors elected who actually think about the legislation they're dealing with, how does this affect Mont Placeto living out in the district? It'll change. If you have a mayor that actually thinks about the stuff they're proposing in terms of how it affects everybody in the city, it'll change. You don't cut $120 million from the police department and then turn around and say, why is crime going up? You just don't do things without thinking it through. So you need to elect people that understand the consequences of what they're doing. How does it affect the taxpayer? How does it affect the residents? How does this affect the homeless when you just pour money at them and nothing's happening? You're making it worse. You're creating an industry. When you de-emphasize the exploitation and the harm of crime, how does that affect the city? It makes more people run and do smash and grabs and whatnot. If there's no consequences, there has to be consequences. You have to be strong enough and honest enough to enact consequences. And that's hurtful. Yeah, take a lot of heat for that today. It's like you have to treat everybody the same regardless of race, color, or creed. Take a lot of heat for that today. Oh, that's racist. How is that racist? The opposite is racist. So there's a lot of criticism for people who stand up and are honest. But what we need to do is support them. We need to support those guys that are running that are talking the right lingo and get them in there. And sure, it'll change around. It can change around. San Francisco will change around. It's a great city. It's got great roots and bones and all that. Whatever you want. It's got a great history. It's a lovely city. It was a shining city of the world at one time. It can come around. It'll come around again. These are man-made problems. So it's ultimately the people that would make the difference, right? Absolutely. I think many people feel that their efforts don't make a difference. They do. They feel that way today. Before, you could get to your local elected representative and you could talk to them and maybe influence them. Now they're insulated. They're in City Hall. Try to make an appointment to go see one of them. It's impossible. Try to call up the police department and say, hey, somebody's breaking in my house. It's an hour before they get there. There's no response. People are upset because they're not being heard. And so who's to blame? Who's really to blame? They themselves. They elected these people. Stop and think about who you're electing and what they're saying. And are they working for you or are they working for themselves? We have a governor that went all the way to the top on flash and no substance, just different programs. And I'm not being mean here. I'm just telling it the way it is. We need people with substance now who care about other people to run for office. That's what we need. Tony, about the homeless issue. You know, there's a lot of talk about it. There's a lot of concerns people have. I want to ask you, what would you say is the number one concern that the people of San Francisco need to worry about in dealing with a homeless situation? Well, Steve, I'm glad you asked that question. The homeless situation has changed in San Francisco. The numbers are still there. But it's no longer just a vagrancy problem. It's now become a health and safety problem. And if we're to treat these people compassionately, rather than just throwing money at them, if we're to treat them compassionately so that they benefit and the people living in the city benefit, we have to approach it from a health and safety point of view. The encampments and the areas that are now overridden with homeless people are creating health problems. Vermin, rats, it's a health problem now. It's not just a matter of vagrancy. So that's the way we have to approach it. We have to help them and consequently help the people who live in the city. They need their thoroughfares back. They paid for those streets. They paid for those sidewalks. They need that back to make the city whole, to make it work economically. But to help the homeless people, we have to approach it from a health point of view because it's gotten to that. It's deteriorated to that level now. What kind of health issues are you talking about? Well, it's not healthy for them to live in encampments on the streets. It's causing all kinds of health problems. Which can lead to other issues affecting the city. Exactly, which lead to other issues. But if you go to the emergency centers now and where they're being brought, you're finding out that these people in the encampments, they've got some serious health issues because they're living on the street. They're developing different conditions that weren't there a couple years ago. Now these encampments are entrenched and they're developing health issues that are going to hurt them and spread to the people who aren't living in the encampments. So we have to approach it from that point of view. That's a new dimension, if you will. And so that's where we have to go with that. And anybody that votes against that is voting against humanity. They're voting against compassion. They're voting against helping their brother who's in trouble. So we need a board of supervisors that understands what this is evolving into. If we continue to institutionalize, if we continue to let these people live on the street, it's going to get worse. So we have to make a move. And it's under a health and safety approach. The other thing, talking about San Francisco, the commerce sector, small business. If we don't revitalize the commerce, small business, we're not going to have a city left. The small business person has been shot out of the action. Anywhere you go in town, even during this APEC conference, look at the way they barricaded the streets. The Ma and Pa grocer, the liquor store, none of these people are even going to get the benefit of this conference. If we don't revitalize business in San Francisco, you're not going to have a city left because the revenue won't continue to come in. The Asian community, you would think like during this APEC conference, give you an example, the Chinese delegation has taken over the St. Regis Hotel. But they're not allowing their delegates staying in the hotel to go out to the local restaurants. So the Chinese can't go to Chinatown to have good Chinese food. They got to stay in the hotel. They're saying, well, it's too dangerous out there to go out. The mayor's talking about 50 million coming into the city. It's not going to the local merchants. If it was, the city could get a leg up. It's not. I don't know where it's going. Well, I've seen comments, people saying that the city has not been cleaned up for them, but it has been cleaned up when a dictator is showing up. Well, I mean, they cleaned it up awfully quick, didn't they? I bet they've done this over the years. Willie Brown was an expert at this. Move the homeless out when you had the president come through, the vice president or somebody. Move them off the corridors, you shuffle them around. They'll be back next week. They'll be back in two weeks. The city will be just like it was before the APEC time. They've just cleaned it up, moved them around. There's people making money on the homeless problem the way it is today. That's why the problem is the way it is. Money's being made on it. If you cleaned up the homeless problem, what are you going to do with all the nonprofits that are served? There's 60 different nonprofits involved with our Department of Homeless Services right now. What are we going to do with them? How many people does that translate to for jobs? They're out of work. If you clean up the homeless problem, you're putting an awful lot of people out of work. If you clean up the crime, you might see the city turn around. If you start to support the commerce, business, small business enterprises, you might see the city turn around. If you really come down on drugs, you have to deal with drugs. That's a big part of the ruin that's affected San Francisco. If you deal with drugs, have zero tolerance for drug pushers and compassion for those that are hooked on drugs, you treat them because of their addiction, we can solve that problem. But if we just keep pouring more money at it, or if we, in the case of drugs, we start taking the money away from the police that are supposed to be doing the job, not going to happen, is it? Not going to happen. Now, this mayor, and I'm not knocking her. She means well. I think she means well. She is a little short on follow-through. She comes out with a different program and a different statement. She's trying to look like now she's a conservative and she's concerned about the city. There's no follow-through. When she says anybody who's going to get benefits from the city has to get treatment for their addiction or their mental health, it's not set up for it. There's no department doing the work. It's great to say that, but if a person is taken off the street and there's no facility for them, it's empty talk. It's more Gavin Newsom, empty suit, parading ideas. And people are too busy raising families and working hard to say, what is the city actually doing? They're not looking into it. They don't have the time. So getting back to another value, people in office today know they can get away with making these outlandish claims and come up with outlandish programs, and no one's going to care because no one follows through. No one's got the time to say, what's happening here? Is it true or not true? We're all too busy. I want to go back to Newsom for a little bit. He recently went to China, and he got a very nice welcome, including a meeting with the president there. Why does he get to meet with the president? Well, let me rephrase that, if I can, Steve. That's what I think the public believes. He went to Israel on his way to China, got very little exposure there, claims he met with certain dignitaries. I think they were a little bit busy. They had their hands full. They weren't going to fool with Gavin Newsom, even though he's the governor of the state of California. When he went off to China, I think President Xi gave him his 10 seconds of a photo op. Newsom wanted to sit there and talk, so he claims about the climate and this and that with the biggest climate abuser in the world. Didn't happen. He got a 10-second photo op, and then he sat down with photo after photo with a roundtable of Chinese corporate leaders, the people that delivered the masks at $5 a pop when COVID broke out. It's a Chinese corporation, wasn't it? There's dozens of them doing business with the state of California. Unfortunately, he slipped on the basketball court, something he should have been able to deliver being a basketball player. But no, it was a good PR trip, that's all it is. Again, you have to know what is really going on and really look at things to correct and to make it better. If you're afraid to talk about race relationships and the idea that everybody's created equal and the idea that we want to treat everybody the same, then if you're going to be called a racist because of that, you can't be afraid to speak out. You have to get back to the basics of human nature. We're all the same. We're all in this fight, and we have to take care of one another. If we don't get back to that, Steve, we're just going to continue along the path we're on. Anything else you'd like to add? No, I appreciate you having me on the show, and there's a lot of people that think like I do out there. A lot of them have left San Francisco because they just don't want to be around it. A lot of them still hang in there because they love the city and they know what it could be. And the idea is to get the city back, not back to what it was. Nothing's ever the same as it was, but make it a new place, a new city again, but with San Francisco values. It can be great again, yes. It can be the Paris of the West or whatever you want to call it. It's set up for it. It's got a great tax base if it's not abused. It's got a small, workable constituency. It's got a downtown sector that is phenomenal in terms of returning tax money and whatnot. It can be done, but we have to work towards that. We have to look at what's really there and work with it, massage it, make it better, and the city will take care of itself. Thank you. Thank you so much for being on the program. Thank you. I appreciate it. Thank you very much. Appreciate it.