The arrest of Public Works Director Mohammed Nuru has led to a citywide corruption investigation. (Kevin N. Hume/S.F. Examiner)

City attorney subpoenas PG&E, contractors, nonprofits in Nuru corruption scandal

Herrera alleges donations funnelled to fund city programs and events

The net encircling former Public Works director Mohammed Nuru has now ensnared more entities in The City’s ever-growing corruption scandal.

City Attorney Dennis Herrera on Wednesday announced subpoenas against companies including PG&E, Recology, city contractors Webcor Builders, Pankow Builders and Clark Construction Group. The subpoenas also name three nonprofits, the Lefty O’Doul’s Foundation for Kids, the San Francisco Parks Alliance, and the San Francisco Clean City Coalition.

Herrera is seeking records relating to donations to nonprofits “his office believes were involved in funneling donations to fund City programs and events, including funding Public Works holiday parties,” as part of a joint public corruption investigation with City Controller Ben Rosenfield.

“We’re following the facts, and we’re following the money,” Herrera said in a statement. “We are going to follow the evidence wherever it leads. We will get to the bottom of this. San Franciscans deserve no less.”

The City Attorney’s Office investigation stems from federal corruption charges against Nuru and Lefty O’Doul’s restaurant owner Nick Bovis, who were both arrested by the FBI late last month and later released on a $2 million bond.

Federal prosecutors chiefly accused Nuru and Bovis of trying to bribe a San Francisco Airport Commissioner with $5,000 to obtain a restaurant contract for Bovis.

But federal officials also alleged other schemes by the two men, including attempts to obtain a restaurant contract for Bovis in the Salesforce Transit Center, which Nuru oversaw in his role as chairman of the Transbay Joint Powers Authority, and accepting trips from a Chinese billionaire to influence approvals for a housing development at 555 Fulton Street.

Herrera has widened the scope of that investigation.

Wednesday’s announcement came after the San Francisco Examiner reported on records showing that Lefty O’Doul’s Foundation for Kids misused charity donations from contractors in 2017 to pay for a $30,000 Public Works holiday party.

Now, new records obtained by The Examiner suggest the same thing may have occurred in other years.

Nuru, party man

Public records this column is exclusively reporting here for the first time show that Bovis obtained more funding from city contractors to pay for a Public Works holiday party in 2019.

A December 20, 2019 invoice sent by Lefty O’Doul’s Ballpark Baseball Buffet & Cafe states that Public Works owed $9,213 for the party, which included appetizers, a “seafood station,” carved meat and refreshments.

However, that invoice, obtained in a public records request, also states that that amount is the remainder due after deposits totalling $33,000 from four city contractors. That included a $20,000 deposit from Recology, $5,000 from Clark Construction Group, $5,000 from Pankow Builders, and $3,000 from Webcor that was “pending.”

In other words, Bovis wrote out potentially illegal donations to Public Works on the bill he sent the department, plain as day.

Webcor, Recology and Pankow Builders were the same contractors identified by this column as having made donations to the Lefty O’Doul’s Foundation for Kids in 2017 that were ultimately used for a holiday party.

Public Works isn’t allowed by law to accept money from those contractors because Nuru had decision-making power over them — to wit, he sets garbage rates, and the various construction firms have or had contracts with Public Works.

The donations to the Lefty O’Doul’s Foundation for Kids, then, disguised the true source of the funding for the Public Works’ holiday party.

Emails obtained by this columnist suggested the Recology and Pankow donations were intended specifically for that party, whereas city officials told Webcor its donation was for a toy drive holiday party that, ultimately, did not exist. Other emails showed Bovis describing Nuru as directing money from unspecified sources to the Lefty O’Doul’s charity, to pay Bovis back for the $30,000 holiday party in 2017.

In response to our story from last week, Herrera said Wednesday that he believes those actions show contractors allegedly “funneled money” through Lefty O’Doul’s Foundation for Kids.

“Webcor has not yet received the subpoena. The company will comply with The City’s subpoena and will fully cooperate with any investigation into this matter,” Sam Singer, a Webcor spokesperson said. “Webcor made donations to the Lefty O’Doul’s Foundation for Kids fully expecting the money would be utilized to fulfill the charity’s mission.”

Recology issued a statement Wednesday saying it has launched an investigation into contributions made to the Lefty O’Doul’s Foundation for Kids, and on Monday “Recology proactively and voluntarily contacted the San Francisco City Attorney’s office and pledged to cooperate with any investigation. Recology is committed to operating with the highest ethical standards.”

As for Clark Construction, a company spokesperson wrote in a statement, “Clark is aware the subpoena has been issued, but at this time Clark has not been served. Clark takes this matter very seriously and is certainly committed to full cooperation with the City Attorney’s Office.”

Herrera’s subpoenas Wednesday “might offer some clarity, that’s true. It might open up the books,” said Tom O’Doul, cousin to famous San Francisco Seals ballplayer Francis Joseph “Lefty” O’Doul, and who is on the charity’s board. O’Doul said Bovis would not let the board see “the books” regarding the charity’s finances.

“Nick is going to resign as president” of the board, O’Doul told me Wednesday. O’Doul and fellow board member Al Casciato want to revive the foundation and fulfill its original mission to help children connect with baseball.

“We’d rather see kids on a ball field than a street corner,” O’Doul said.

San Francisco Port Commissioner Kimberly Brandon, who also served on the Lefty O’Doul’s Foundation for Kids board, also told me Bovis never revealed details of the foundation to the board.

“He duped us all,” she said.

New players, same allegations

Lefty’s wasn’t the only nonprofit that may have been throwing screwballs, according to the City Attorney’s Office. For instance, Herrera is seeking financial records and communications between PG&E and the San Francisco Parks Alliance, or between Clark Construction Group and the Lefty O’Doul’s Foundation for Kids.

“PG&E and its employees work hard every day to uphold both the letter and spirit of the law and the company’s own ethical standards. We acknowledge receiving the subpoena, are reviewing it now and we will respond,” Matt Nauman, a PG&E spokesperson said in a statement.

Similarly to PG&E, The Clean City Coalition and SF Parks Alliance have not been previously highlighted in the Nuru investigation.

The SF Parks Alliance is a nonprofit dedicated to boosting green space in San Francisco and is playing a key role in promoting Golden Gate Park’s 150th anniversary this year. The Parks Alliance website mentions a “Party For the Parks” gala “like no other in San Francisco” with an “extravagant buffet dinner” to raise money for San Francisco civic projects.

Herrera’s wife, Anne Herrera, has served on the SF Parks Alliance board.

The nonprofit has roughly $10.3 million in net assets, according to its 2018 IRS Form 990, a public document available on investigative news website ProPublica’s “Nonprofit Explorer.” Its representatives did not respond to a request for comment.

The Clean City Coalition was established in 1991 and aims to focus on “cleaning, greening and beautifying” San Francisco, according to its website. The coalition has roughly $2.7 million in net assets, according to its 2018 IRS Form 990.

Clean City Coalition staff did not respond to a request for comment.

Separately from the subpoenas, the City Attorney’s Office said its joint investigation with The City Controller’s Office identified a scheme with a Bovis-related entity named SMTM Technology, LLC, which had a $171,000 contract with Public Works for portable bathrooms. The City did not pay Bovis, or anyone, any money under that contract.

The City terminated that contract for “non-performance” — the bathrooms were not delivered.

One of the schemes identified by the feds alleged Nuru gave Bovis inside information to obtain a portable bathroom contract.

The breadth of Herrera’s subpoenas suggest years-long, widespread corruption is suspected, said Larry Bush, a longtime ethics watchdog. Bush, who co-founded the group Friends of Ethics, noted that many targeted by Herrera also make legal payments to nonprofits on behalf of city officials as favors, which are regulated and called “behest payments,” an ethically dubious but common practice.

The arrest of Nuru and Bovis may help shake San Francisco from its complacency around pay-to-play politics, Bush said.

“I think most of the people on the subpoena list have either been behest donors or behest recipients, it’s what people call ‘legal bribery.’ And it’s in the millions of dollars,” Bush said.

He added, “It’s no secret how to play the game in San Francisco, what has been secret is who would confront it.”

On Guard prints the news and raises hell each week. Email Joe Fitz with tips at joe@sfexaminer.com, follow him on Twitter and Instagram @FitztheReporter, and Facebook at facebook.com/FitztheReporter.

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