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West of Twin Peaks Observer
April 2008

Dangerous Precedent Involving Laguna Honda Hospital
by George Wooding

The City of San Francisco is using “friendly” litigation to create public health policy. Voters will end up paying for new and untested public health policies drastically different from what we approved at the ballot box.

As I noted in last month’s Observer, the future of Laguna Honda Hospital remains threatened by the Chambers settlement agreement, an obscure lawsuit overturning the will of voters who passed Proposition A to rebuild Laguna Honda. The Chambers settlement agreement is a symptom of bigger problems within San Francisco City government.

Never has a legal settlement agreement involving major policy changes in San Francisco been so shrouded in secrecy or so welcomed by the Board of Supervisors, the Department of Public Health (DPH), and local non-profit contractors seeking lucrative City contracts to provide community-based services. The City quickly capitulated to the terms in the Chambers settlement and never fought the settlement agreement.

The Chambers settlement agreement is the City of San Francisco’s attempt to set public health policy through a lawsuit. The Examiner’s March 27 editorial, “Medi-Cal cuts are budgetary fake,” stated “more often than not, making budget policy in the courts is a bad idea.” The Chambers settlement is a “friendly” lawsuit, which the City appears to have potentially colluded in to avoid public scrutiny of major public policy changes.

If the Board of Supervisors accepts the Chambers settlement as currently written, they will be creating a huge open-ended public health and housing entitlement program that will eventually drain the City’s discretionary portion of the General Fund, restricting future Supervisors’ legislative control of the City’s discretionary funds.

At the time of this writing, neither the City Controller or the Board’s Budget Analyst have performed a fiscal analysis, nor has the Board’s Legislative Analyst performed a legislative analysis, of the Chambers settlement. Supervisor Michela Alioto-Pier sponsored a ballot measure in November 2004 that passed, requiring an Economic Impact Review (EIR) of all pending legislation. She noted, “We can’t afford to pass legislation that creates hidden costs.” But no EIR to uncover the hidden costs in the Chambers agreement has been performed.

Every budgetary set aside, every entitlement, and every lawsuit (the Chambers settlement) diminishes the Board’s powers over discretionary spending, weakening their legislative ability to effectively represent San Francisco voters. Voters don’t want the Board’s legislative power usurped by the judiciary branch through “friendly” lawsuits. When the legislative branch becomes weaker than other branches of City government, voters become disenfranchised.

Although Supervisor Sean Elsbernd claims the City can “revisit” the Chambers settlement terms anytime within the next five years, nothing is further from the truth. Section XX of the agreement explicitly stipulates it can be changed only with approval of the United States District Court. Sections II and XX stipulate that once approved by the Court, the agreement will be contractually binding upon all parties and their “successors and assigns,” and the City. Without the District Court agreeing to suddenly reopen the Chambers terms, the City cannot unilaterally revisit the settlement at any time.

Elsbernd also claims the Chambers settlement is “a tried and true concept of good government.” But the lead counsel in the Chambers lawsuit, Elissa Gershon, an attorney with Protection & Advocacy Inc., has stated she’s not aware of any other city doing this. San Francisco is the only City in the country adopting this program, so it cannot be “tried and true,” as Elsbernd misasserts.

Elsbernd has stated his belief San Francisco has been “fair and responsible” with the 139,000 voters who passed Proposition A. A companion article in this month’s Observer shows the total budget of the replacement project to rebuild all 1,200 beds is currently $704 million, $303 million over the $401 million initial project budget, representing a 75.6% increase. But only 780 beds have been approved to date. This isn’t what San Francisco voters were promised by our City fathers, and it’s neither “fair” nor “responsible,” as Elsbernd incorrectly claims.

The concept of legislation through litigation is a very bad idea. Whatever the intentions of the Chambers plaintiffs, their “friendly” lawsuit with the City and its open-ended set-aside for housing and public health entitlements, is a direct attack on the powers of the Board of Supervisors’ legislative authority and the will of San Francisco voters. The Board’s legislative authority over housing and public health will be limited, and voters will have been betrayed by the City and DPH.

The Chambers agreement establishes judicial and budgetary “fake.” This creates a dangerous precedent before the upcoming San Francisco General Hospital bond measure. Please contact City Supervisors, urging them not to accept the Chambers settlement as currently written

George Wooding
Mid-town Terrace Home Owner’s Association

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