It’s been a week since Mayor London Breed tapped City Attorney Dennis Herrera to lead the Public Utilities Commission, a massive, billion-dollar entity providing San Franciscans — and, in fact, millions of nearby locals — with water and/or power.
It’s been a week, and nobody seems to be saying it, so we’ll say it: This is weird.
It would be weird if the mayor transferred a hypothetical general manager of the Public Utilities Commission — with a background touching on engineering and water and wastewater and sewage treatment and hydroelectric power generation and distribution — into leading the City Attorney’s office. The reverse is weird, too.
So, it’s a weird move. But this is a weird place. It reflects on San Francisco’s weirdness that this was even contemplated, let alone consummated. It reflects on San Francisco that no suitable candidate with subject matter expertise either made the cut — or perhaps opted to even apply — for the plum job atop the PUC, which has been overseen by acting GM Michael Carlin since Harlan Kelly in November resigned after being hit with federal bribery charges. It reflects on San Francisco that placing an elected official atop a department where he or she may or may not have subject matter expertise is a somewhat common practice most of us have become inured to — and not the issue here inducing any significant public blowback (more on that in a minute).
It also reflects on San Francisco that corruption is seen as so endemic that this move was sold, in Herrera’s words, as “putting the city’s top watchdog at the head of the PUC.”
Herrera — who has been a hell of a successful city attorney for nearly 20 years — was already overseeing a public integrity investigation triggered by the January 2020 arrest of disgraced Public Works boss Mohammed Nuru. And it has been active and productive.
It would seem to be a disturbing sign to need to have a live-in watchdog installed atop one of the city’s biggest departments.
Proponents of transferring Herrera to the PUC said that, yes, the city could’ve gone the route of a nationwide search, and yes, you could have found someone with relevant experience to running a billion-dollar water-power-sewer entity — “but they wouldn’t have known 28th Street from 28th Avenue.”
Oh, I get it. I’m from here, too: “We like ourselves, don’t we?” as the Church Lady used to ask. But insisting only a San Franciscan can solve San Francisco’s problems can read like a justification for provincialism, insularity and self-dealing. Isn’t that how we got into this mess?
Herrera has been City Attorney for two decades, and there are very few corners of city government his office does not touch. So, it figures he’s picked up some knowledge along the way about all manners of PUC arcana. And his lack of a traditional PUC resume is not a concern for everyone: “Look,” says another longtime city player, “Dennis Herrera does not have to go out and fix the dam. They have professionals who can fix the dam.”
Herrera — again, a hell of a successful city attorney — was suing and beating PG&E since even before the utility giant was blowing up suburban neighborhoods or burning down vast swaths of Northern California. His backers tout him as more knowledgeable about city energy policy than the folks in charge of city energy policy. That may be a hyperbole, but this isn’t: The city’s desire to further expand its foray into the power business has led to San Francisco and PG&E increasingly butting heads — and Herrera is a man who has not shied away from these confrontations.
“PG&E needs to be a hell of a lot less difficult when it comes to hooking up city projects, affordable housing and the like,” Herrera told us last week. “We’ve had disputes with them before the Federal Energy Regulatory Commission on rates all the time. There are a load of issues we have with PG&E.”
Herrera added that “we have been out there taking the lead on issues of municipalization.”
Municipalization. That’s the sort of talk that former PUC general manager Susan Leal — also an elected official placed atop the PUC with no subject matter expertise — claims got her canned from the job in 2008. Too radical.
That was then. Now, it was apparently a prerequisite for Herrera. Vanquishing PG&E and achieving “Public Power” was long the fever dream of the city’s Guardian left. If it comes because of Mayor London Breed, that newspaper’s former stalwarts will roll over in their graves.
Even though they’re not dead.
Herrera’s backers said there was “nobody better” to clean up the PUC’s problematic Community Benefits program. Big, if true. People will be keeping an eye on that. And with Herrera being portrayed as the new sheriff of the PUC, multiple employees there questioned the recent costly whistleblower retaliation case in Herrera’s own office.
But if all Herrera does is push out corrupt and/or inept players and slay the gorgon that is PG&E — well, you could do worse than that. In a blow against subject-matter expertise, Kelly held an engineering degree from UC Berkeley and was San Francisco’s longtime former city engineer — and he purportedly turned the PUC general manager slot into a graft machine.
But — and you knew there’d be a but — Herrera is facing steep challenges.
San Francisco has had more than its share of department heads with no subject matter expertise, and sometimes that works out — but sometimes it does not. Nobody doubted that former Muni boss Ed Reiskin was a good and earnest guy, but the city’s transit agency didn’t exactly flourish under his watch. As we put it in April, 2019, when he acquiesced to mayoral demands for him to depart, “the transit specialists in his staff appear to have taken liberties a more expert boss may have noticed and not countenanced.”
The same could happen here. Some employees at the PUC are worried Herrera would not understand the complexities of what they do — and some, frankly, were pleased. They could yet take liberties a more expert boss may have noticed and not countenanced.
It’s also worth noting that the PUC is an order of magnitude larger than the City Attorney’s office. Herrera will go from managing several hundred high-performing lawyers (who are at-will employees) to several thousand PUC workers from varying backgrounds (and with civil service protections).
And for all Herrera’s success battling PG&E and his knowledge about city energy policy, the vast, vast majority of the PUC’s income is derived from its water side. Glancing over the agency’s most recent comprehensive annual financial report, water and wastewater account for $827 million of the PUC’s $1.17 billion in revenue — 73 percent.
Public Power, pun intended, gets the spotlights. But the PUC sells water to dozens of counties and millions of customers. That’s where the money is.
Speaking of money, Herrera says this was not a dollar-driven move. If he wanted to earn much, much more, he could’ve left the City Attorney’s post long ago. This is true. But it’s also true that shifting to the PUC will entail a six-figure raise — and that income is pensionable.
Herrera wanted a new challenge. He’s getting one. He will jump into a vast and beastly complex machine with lots of moving parts.
Politically, however, there may now be fewer moving parts.
Mayor London Breed hardly appears vulnerable, but a lot can happen between now and the next mayoral election in 2023. If things go poorly, even ostensible allies might jump into the race.
But likely not Carmen Chu — the elected assessor was tabbed by Breed to take the vacant City Administrator seat. And, barring unforeseen lunacy, not Dennis Herrera — the elected city attorney and erstwhile mayoral candidate has been tapped for the PUC. And, crossing into the realm of speculation, what if Breed were to name elected Assemblyman David Chiu the next City Attorney? That’s him off the list, too. And, double-banking the speculation, what if Supervisor Matt Haney were to run for Chiu’s seat and win it?
Presto! Cleared the field.
Meanwhile, the City Attorney’s investigation of City Hall corruption continues, and Breed will name the next leader of that office. It’s this, and not Herrera’s unconventional bona fides for a PUC boss, that has drawn the most fire. Supervisor Dean Preston on April 27 issued a letter of inquiry to Herrera’s office questioning, among other matters, whether Breed naming the City Attorney who will be overseeing this corruption probe would create “a conflict or the appearance of a conflict.”
And this crosses into dicey territory. Because, of course, there’s the obvious appearance of a conflict. But an actual conflict would require impugning the integrity of the City Attorney’s office and the work it has done thus far (including unearthing the details that led Breed to go public with her mea culpa that she’d had a past relationship with Nuru and recently accepted what certainly appears to be an improper $5,600 “gift” from him).
It would also require impugning the work of Keslie Stewart, the actual day-to-day boss of the ongoing public integrity probe.
Anyone unwilling to do this might want to think twice about casting stones.
Potentially transferring the investigation to a neighboring city attorney’s office would figure to be a challenge — this is a long-running slog, and outside agencies, even those with reciprocity agreements, would be reluctant to take it on. And if the District Attorney is interested in asserting himself, he’d figure to need more money and personnel. Let’s see if the supes push for that during the forthcoming budget season.
In the meantime, the city keeps chugging along. An official at the PUC, asked about how colleagues were taking this news, said “people are having a difficult time processing this.”
San Francisco is a weird town. But that — that’s not weird.