A pair of supervisors today called for a City Attorney investigation of allegations made in a Saturday Mission Local story. That story documented a series of permit irregularities at both the home and on properties owned by Angus McCarthy, the longtime president of the Building Inspection Commission, which oversees the Department of Building Inspection.
The Saturday Mission Local article also documented McCarthy’s statement in a Sept. 20 sworn deposition in which he acknowledged sending material written by Department of Building Inspection personnel to his private builder colleagues at the Residential Builders Association to be edited and redrafted.
Today’s formal request, made by Supervisors Hillary Ronen and Aaron Peskin, calls for the City Attorney to “investigate and report to the Board of Supervisors on allegations and improprieties and possible conflicts of interest by Building Inspection President Angus McCarthy as reported in Mission Local on September 25, 2021.”
Ronen, Peskin, and Supervisor Myrna Melgar, additionally, said they will work toward putting a measure on the June, 2022, ballot to undo Proposition G of 1994, which created the Department of Building Inspection in its present iteration.
“It is becoming clearer by the day that DBI is a fundamentally broken institution that needs fundamental change,” Ronen told Mission Local.
She and her colleagues are pondering several possible large-scale changes to the department to put before voters next year. It could be merged with other departments and/or placed under the City Administrator. Ronen hoped for “oversight by a department that isn’t quite so cozy with the industry it’s supposed to regulate.”
McCarthy is presently in Ireland, tending to his ailing mother. He did not respond to Mission Local’s queries last week, which we submitted in writing at his request; our story ran after allowing him 48 hours. On Monday night, he sent a letter to members of the Board of Supervisors co-drafted with his attorney, Andrew Wiegel, countering the allegations made in Mission Local’s article and welcoming an investigation.
The rebuttal letter is a fascinating document, and inspires a good many questions.
It does not explain why a permit to convert a crawl space into a wine room and exercise room applied for in 2007 received no inspections and, to this day, never received a final sign-off — even though the entire building received a final sign-off in 2009. It does not explain why the 2005 permit to erect this building listed it as “three stories, no basements” and the 2009 certificate of final completion listed it as “three stories, no basements” — but the 2007 permit listed it as “two stories, one basement.”
“This may have been a clerical housekeeping oversight by the district inspector at the time of the final inspection, Mr. Bernie Curran,” McCarthy wrote, “but the oversight escaped my attention.”
McCarthy says his permit to “Convert crawl space under building to wine room and exercise room” did not require any additional excavation work. But this is a curious claim, semantically and otherwise: If you’re converting a crawl space — which by definition does not have sufficient headspace to be a habitable room — into a habitable room, it’s hard to envision a scenario that doesn’t require excavation.
There is one: The excavation was done prior, without permitting.
McCarthy denied this under direct questioning in a Sept. 20 sworn deposition tied to former planning commissioner Dennis Richards’ ongoing lawsuit vs. the city. But he did concur that the basement room was built at the same time as the rest of the building, which doesn’t sequentially add up on this building’s permitting history.
Rather than excavating or doing additional foundation work, McCarthy wrote that he only “needed to sheetrock and paint the walls and install the finished flooring.” This would help to explain the svelte $25,000 cost associated with this project.
But this explanation is hard to comprehend. For one thing, the 2007 permit is emblazoned with a “State Industrial Safety Permit” stamp, noting that “construction of trenches or excavations which are 5 feet or deeper and into which a person is required to descend” are part of this project.
Private special inspections mandated for this project, including “bolts installed in concrete,” “reinforcing steel” and “holdowns,” correspond with foundation work, not sheetrock and paint.
What’s more, the contractor hired for this project was Ryan Engineering, an excavation specialist. Reviewing Ryan’s qualifications on the state licensing page, this would appear to be an excellent choice for heavy excavation. It is unclear if Ryan, which does not possess a Class B general contractor’s license, is even licensed to do sheet rock.
There were, again, no recorded DBI inspections for this project, and it has never been signed off.
Mission Local noted in its on Saturday story that a sign-off from the Department of Public Works mandated before the building could be completed was not present on any of the job cards available to the public, was not in DPW’s system, and a DPW inspector told us no inspections were recorded on-site prior to 2011. But this building was signed off in 2009.
McCarthy in his rebuttal letter produced an inspection report indicating a DPW signature was received in 2008 — though, again, Public Works has informed Mission Local that this is not registered in their computer system.
This inspection report brings up other questions, however: Significantly, there is no sign-off on it for “OK to Pour.” There is also no sign off for insulation or duct inspections. And the notes page, which records inspectors’ observations and criticisms, was not included in McCarthy’s rebuttal.
With regard to an investment property on 23rd Street McCarthy sold in 2017, he explains away Curran’s appearance to sign off on the project and do away with complaints as something of a coincidence. “For the second inspection request, Mr. Curran showed up. I believe Mr Curran was the Senior for this district and must have been covering for the district inspector.”
Curran is currently facing federal bribery charges. And senior inspectors are not supposed to fill in for their district inspectors — and rarely do. In fact, all the way back in 2014, Curran’s own propensity to improperly drop by at inspections led to Department of Building Inspection policy stating what’s supposed to happen when a district inspector can’t take a job.
Senior building inspectors are the No. 7 option. If department policy were actually observed, Curran randomly showing up on-site multiple times would be a statistical oddity.
Finally, McCarthy downplays the matter of a letter he sent to then Building Department head Tom Hui in his official capacity as Building Inspection Commission president. This letter was drafted by Department of Building Inspection staff at McCarthy’s request — but he also sent it to his fellow Residential Builders Association members Sean Keighran and John O’Connor for editing and redrafting. McCarthy said during the deposition he did not inform DBI of this.
In his rebuttal, he describes the letter as a personal missive, revised by a “building industry leader,” and “not DBI materials as stated in the article.”
The letter was signed “Angus McCarthy, Commission President,” and was, again generated by Department of Building Inspection staff prior to being edited by private builders whose work is inspected by the Department of Building Inspection.
Asked about the acceptability of this process, a DBI spokesman said that “City departments and commissioners are allowed to solicit feedback from stakeholders.”
Hi Joe:
Great job. Please keep me updated regarding SF DBI latest news.
Myself, I am going through a very painful inspection process by some inspector who intentionally created requirements to delay the construction project because He has some personal vendetta with the contractor who complained about his service.
Many of us fail to understand how employees of City government are tasked with providing non linear reasoning to City codes and regulations. Discretion at any level leaves the door wide open for corruption.
Absolute power corrupts and absolute power corrupts absolutely. Governance of SF will always be problematic as long as it is controlled by one party with no serious threat of a different party assuming power. Having power change hands in the form of different political parties makes everybody just a bit more honest. Nobody wants to rock the Democratic Party machine that rules SF, so if you are an up-and-coming politician/administrator, you just look the other way because you don’t want to upset the corrupt people feeding at the trough.
Let’s see the plan to revamp the department. Let’s also see some effort on the part of the city authorities to protect whistle blowers and to set up a funding mechanism that aides public citizens in their efforts to bring actions and file complaints against city employees when they have information and cause to do so.
I used to call City Gov. Dysfunctional and I admit I was dead wrong, its a Functional Cartel with full blown C3, command, control and coms for the few that fixed the book in milking the City from its resources for personal benefits, most if not all of them appointed by Room 200.
No where in the US, Non-profits used to launder public funds, and City grant used to pay the Mayor lover(s) and friends as a condition of the grant release. No where in the US unlicensed contractors are awarded sole source contracts by CMD, SFPUC and DPW in exchange for a Rolex watch and a farm tractor for 25 years without any oversight.
Going back to the 80s, I never saw corruption in your face by Art Agnos, Frank Gordon and Dianne Feinstein, now its it in the open at all levels and from my personal experience it started with two Depts, DPW and HRC, both popped their puppies into other City Depts, Harlan Kelly, Bob Beck, Nuru and other clowns in charge on Public projects awards (all started their career at DPW). Virginia Harmon, Romulus Asenloo, Zula Jones fixing LBE certification and contracts and “We Do it Better than New York” (started their career at HRC).
What does that all mean for the City can be best illustrated by the fact the SF Central Subway Tunnel cost $3.4B per mile compared with the similar London Cross Rail tunnel at $346M per mile, TEN FOLDS, 9 folds of it in special interest pockets that have nothing to do with the project.
Amazing how much homework you do for the “progressive” sups. They’re all aware of the corruption but your incredible reporting makes it difficult for them to play stupid.
Lee, worse dirtbag of s.f. the corruption is soo DEEP! Keep up the good work, Joe thanks to c.f. also for well informed comments!
Great reporting Joe. Keep it up!
And for those who missed my comments of June 28, here they are again, with minor editing and corrections.
Among the properties developed by Angus McCarthy is 2525 16th St, a 4-story, 150,000 sf property that was built in 1924, and is still permitted for light manufacturing use only, according to DBI online Permit Tracking records. That building was purchased for $67,000,000 in March, 2018, by McCarthy, longtime President of the BIC, and other members of a development consortium. See:
https://www.bizjournals.com/sanfrancisco/news/2018/03/27/san-francisco-office-industrial-building-sale.html
Since being acquired, several permits have been applied for or issued, but only one has been completed. That was a 2018 permit for $300,000 of tenant improvement work on the 3rd floor, and, surprise, surprise, it was issued over-the-counter ☹. That permit, as shown in the online Tracking records, is for work in a building that was supposedly already approved for offices. However, there is no evidence of any approved change of use from F-2, moderate hazard manufacturing, to B, offices. That kind of change of use would have required many more improvements than that included in the relatively simple, tenant improvement project. That’s because there are many more people occupying an office building than a light manufacturing building. And those requirements are especially important for a nearly 100-year-old building.
Other permits for the building have been issued or are in the review process, some for as long as 3 years, including ones for fire sprinklers, heating and ventilation, structural work, an accessible entrance, etc., but no inspections have been done on any of them, according to Tracking records. The total value of those permits that have been applied for and issued but not completed, or are still under review, is more than $12,000,000. In addition, there is no evidence that a Certificate of Occupancy for office use has ever been issued. (There was also a 2016 permit issued to the previous owner for a change of occupancy, but it was never inspected or completed.)
Nevertheless, two very large, 3rd floor, office tenant spaces are now listed for lease on the Property Shark commercial property listing website.
(https://www.propertyshark.com/cre/commercial-property/us/ca/san-francisco/lion-building/)
There is also a For Lease sign on the side of the building.
“How is this possible?”, you ask. Well, maybe Mr. McCarthy’s word is sufficient for DBI Inspectors and other employees ☹. That wouldn’t be a surprise. None of them would like to make it onto the Residential Builders’ Assoc. (RBA) blacklist. If that happened, there would no longer be any chance for promotions for them, even if they were on the list of favorites to begin with.
Looking back, Mr. McCarthy was appointed to the BIC in 2012 by then mayor Ed Lee. That choice was because of the Charter requirement that one member be a “residential builder”, and McCarthy was a residential contractor and member of the RBA. That position has always gone to an RBA member since the Charter amendment of 1994. (It should be pointed out, too, that soon after McCarthy became President of the BIC in 2013, the Commission dismissed the previous Director and appointed Tom Hui to be DBI’s Director. Hui has now been forced into retirement for rampant corruption.)
However, Mr. McCarthy should no longer be considered a “residential builder”. He is rather, now, a multi-millionaire developer, whose various agents, presumably, have numerous interactions with DBI staff. And if that is not a conflict of interest for him, I’d like to know what is. His position as BIC President (or even as a Commissioner) makes the potential for special treatment at DBI a foregone conclusion. And, consequently, he should step down from the Commission asap. In particular, he should not be allowed to remain on the BIC during the selection of a new Director and Deputy Directors. And, at the very least, he should recuse himself from the entire selection process. Otherwise, he is likely to support the choice of candidates who will favor and excuse his own business dealings with the department, such as Acting Director O’Riordan and Acting Deputy Director Duffy.
The only problem with his stepping down, though, is that it’s probably inevitable that another RBA leader would be appointed by the Mayor to replace him. And then, as almost always, that person would be voted President by the other Commissioners, who are, for the most part, political appointees. Joe O’Donaghue, former RBA leader and co-creator of DBI, would be rewarded once again for duping the voters with his ‘94 Charter Amendment. Therefore, and not for this reason alone, the Amendment has to be repealed and replaced, as well. There is no other way to fix DBI.
Everything old is new again. DBI was created out of the old BBI (Bureau of Building Inspection) and was part of DPW, a department that reported to the Chief Administrative Officer (now remade to the City Administrator). BBI was no great shakes either, even with no-nonsense CAO’s like Roger Boas and Rudy Nothenberg, but the corruption wasn’t as in-your-face” as it now is (which is also true. Citywide). And need I remind the dear readers that the previous City Administrator was Naomi Kelly, who resigned under a cloud of corruption.
Changing who a corrupt department reports to is rather like rearranging deck chairs on the Titanic when it’s becoming more apparent that the entirety of City government is corrupt.
Thanks for the update Joe. Some of McCarthy’s excuses seem akin to “the dog ate my homework”.
I seem to remember Roger Boas being arrested, while in the arms of an under age prostitute (likely trafficked) in a Castro area brothel.
True – but he was an honest, competent city administrator. Read his memoir – “Battle Rattle: A Last Memoir of WW II.” He grew up privileged but suffered PTDS from WWII combat.
“Changing who a corrupt department reports to is rather like rearranging deck chairs on the Titanic when it’s becoming more apparent that the entirety of City government is corrupt.”
Agreed. Everybody is in this together for they all have hands in the cookie jar.
Circle the wagons. It will all blow over with minor slaps on the wrist and fat pensions for those obliged to bail.
BTW – we had bond measures passed that proclaimed funds spent would be under the supervision of a citizen oversight committees.
Annnnnnnd ….. never again heard about these committees or whose on them or what they’re doing.
Of particular mirth is Hillary Ronen’s statement:
“It is becoming clearer by the day that DBI is a fundamentally broken institution that needs fundamental change,”
Just catching on to that now, eh?
Going back and reading the ballot information booklet for prop G was really a trip. I voted in that election, but it had slipped my mind that the DBI was created in 1994. I likely voted “yes” due to the pro-tenant group endorsements… file under the road to hell being paved with good intentions. Did prop G really address the issues raised in the paid pro and con arguments? How much of our current situation can be attributed to G, or was the corruption already ongoing at that point? (SPUR warned against regulatory capture at the time.) So many questions come to mind.
“paved with good intentions…” Pro-tenant groups are as dirty as DBI. I refer to them as the missionaries – they came to do good, and they did VERY, VERY well.
I totally support Peskin’s and Ronen’s call for the City Attorney to investigate. I just think the City Attorney should look into Peskin’s connecting stairs, too.
😉
I hope he finally pays for his corruption.