CORRECTION: An early version of this story incorrectly stated that the Flower Mart is in the Soma Redevelopment Area.
UPDATE 2: The Ethics Commission has dismissed this complaint.
By Zelda Bronstein
DECEMBER 16, 2014 — An Oakland florist has filed an ethics complaint against Mike Grisso, the Kilroy Realty Corporation executive who’s playing a major role in the company’s controversial takeover and proposed demolition of the San Francisco Flower Mart to make way for a high-rise office project.
Melanie Ann Tom, the owner of Hawthorn Flower Studio, filed her complaint with the San Francisco Ethics Commission Dec. 9. It accuses Grisso, a former employee of the San Francisco Redevelopment Agency, of having violated state and local laws governing lobbying and financial conflicts of interest by city employees.
Grisso, Tom charges, “negotiated a job with Kilroy Realty while still working for the government, has lobbied his former colleagues on behalf of his new employer, and has not registered as a lobbyist.” Her complaint asks the commission to stop these alleged violations, “to require [Grisso] to file monthly lobbyist reports for July through November 2014, and to impose the appropriate fine or other penalty.”
Tom names Ken Rich and Todd Rufo, staffers of Mayor Lee’s Office of Economic and Workforce Development, as witnesses who can supply “proof that Grisso has lobbied city employees on behalf of Kilroy during one year since leaving office.”
The 38 pages of documentation accompanying the two-and-a-half page complaint proper include numerous emails between Rufo, Rich, and their OEWD colleague Myisha Hervey and Grisso and his Kilroy colleagues Mike Sanford and Dina Kolesnikov.
According to his Linkedin page, which Tom attached to her complaint, Grisso worked for the SF Redevelopment Agency and its successor, the Office of Community Investment and Infrastructure, from October 2002 to June 2014. A June 12, 2014 Business Wire piece, also attached, says that at the Redevelopment Agency Grisso “managed the implementation of the Transbay and South of Market Project Areas.”
Grisso’s Linkedin profile states that in July 2014 he joined Kilroy as senior vice president, development and land use planning. The Redevelopment Agency’s project areas house Kilroy developments, for example, its $450 million Mission Bay office complex.
This history, Tom alleges, indicates that Grisso violated “revolving door and future employment restrictions.”
“Under state and local law (S.F. Campaign & Governmental Conduct Code section 3.206(c): Cal. Govt. Code section 87407),” she writes, “no state or local government employee ‘may make, participate in making or otherwise seek to influence a governmental decision affecting a person or entity with whom’ the employee is discussing or negotiating future employment.”
Tom cites Grisso’s Linkedin profile, the Business Wire story and a November 18, 2014 SF Weekly article as evidence that during the summer of 2014
Grisso left the Redevelopment Agency and began working for Kilroy within a one month time period….Given how quickly he took a job at Kilroy after leaving government service, Grisso must have been negotiating his employment with Kilroy while he was still working for the Redevelopment Agency.
From the other side, Tom alleges that Grisso’s documented involvement in the Transbay and SoMa Redevelopment Project areas shows
the likelihood that [he] made decisions affecting his future employer while still employed by [the] Redevelopment Agency. If Grisso actually participated in governmental decisions affecting Kilroy while he was negotiating a job with the company, he violated the law.
As for the revolving door rules:
City and state law (S.F. Camp. & Govt. Conduct Code section 3.234(2); Cal. Govt. Code sections 87406(d)(1)) prohibit a former government employee from lobbying his or her former department for one year after leaving the department.
Tom claims that the SF Weekly article “suggests that Grisso violated this one-year lobbying ban by communicating with city officials in the course of his employment with Kilroy.”
One subject of these exchanges involved a decision over where the vendors who currently rent space at the Flower Mart would go during and after the construction of Kilroy’s office highrise. Contending that even temporary relocation would kill their businesses, the vendors have sought written guarantees from Kilroy that they will not be displaced, that their leases will be renewed at affordable rates, and that the developer will pay their expenses during construction.
SF Weekly reporter Joe Eskenazi cited a letter that Kilroy chairman John Kilroy Jr. sent the vendors assuring them that “they’ll have a lease up to and during construction of the new facility,” that “tenants in good standing will be offered leases in the new facility,” and that “the Flower Mart will remain at its current location.”
Eskenazi also cited an August email from OEWD Director Todd Rufo informing mayoral spokeman Francis Tsang that “[t]he plan would be for [the vendors] to stay on site during construction.”
Grisso told a different story. The Kilroy executive informed Eskenazi that “‘[i]t’s too early to say” whether every flower vendor would be kept on-site during construction. Indeed, Grisso “confirms to SF Weekly that he looked into potentially shunting the displaced flower vendors onto Pier 38 or land in Mission Bay, reaching out to multiple agencies.”
In other words, as Tom observes in her complaint, Grisso reportedly contemplated moving the vendors “to another location in Mission Bay managed by the Redevelopment Agency.” She goes on to charge that
Grisso’s actions attempt to take advantage of the relationships which he built while working at the Redeveolpment Agency for the benefit of a private company—exactly what the revolving door rules seek to stop.
Lastly, Tom accuses Grisso of having violated city laws regulating lobbyists:
City law (S.F. Camp. & Govt. Conduct Code sections 2.100 et seq.) requires individuals who contact City officials as part of their job to register as “lobbyists” with the Ethics Commission, pay a registration fee, and file monthly reports detailing their lobbying activity; the registration threshold is just five or more contacts in a calendar month with City employees, elected officials or Commissioners….Grisso has flaunted[sic] this law by not registering or filing a single lobbying report—despite abundant evidence of his lobbying contacts with City officials.
In support of this charge, Tom cites the SF Weekly’s report that “Grisso reached ‘out to multiple city agencies’ looking for a space to which he could relocate the displaced vendors from the Flower Market property.”
She also quotes Eskenazi’s description of “‘a series of emails’” between Grisso and Rich “ ‘batt[ing] back and forth a statement regarding Kilroy’s acquisition’ of the Flower Mart, ‘line-editing each other’s text’”—a statement that was “later attributed to Mayor Ed Lee in an article that ran in the Chronicle.” Tom says that “the SF Weekly even calls out Grisso’s ‘ghostwriting’ as an inappropriate level of influence for a real estate developer to exercise within the Mayor’s office.” She attached more than two dozen emails to her complaint.
The city’s 2014 Lobbyist Database currently lists 122 active lobbyists. (No, Ron Conway isn’t on the list.) Grisso is not registered.
The Ethics Commission’s next meeting is tomorrow, December 16. Last Thursday I called the commission office and asked if Tom’s complaint would be on the agenda, which had not yet been posted. Commission Executive Director John St. Croix told me that there were no hearings scheduled for the 16th and that in any case, he would not “confirm, deny, or discuss” the matter. He also said that city law requires him to conduct a preliminary review of a formal complaint to determine whether a formal investigation is warranted, or whether the complaint should be dismissed.
After talking to St. Croix, it occurred to me that Grisso himself might not know about the complaint. Checking the commission website’s “Complaints” page, I read that “the Executive Director may provide a copy of the complaint to the respondent[s], if the Executive Director determines that disclosure is necessary to the investigation” [emphasis added]. The relevant passage from the “Commission’s Regulations for Investigations and Enforcement Proceedings” expresses the same indeterminacy:
Preliminary Review. The Executive Director must conduct a preliminary review of each formal complaint. This inquiry may include reviewing relevant documents, communicating with the complainant, communicating with the respondent, and any other inquiry to determine whether a full investigation is warranted.
I spoke to Grisso late Thursday afternoon. He knew nothing about the complaint. Reasonably enough, he declined to comment on something he hadn’t seen.
As it happens, the Ethics Commission’s December 16 agenda includes a handy “fact sheet” about the San Francisco Lobbyist Ordinance prepared by UC Hastings law students (Item IV). A statement on the fact sheet’s “Lobbying Contacts” page indicates that Tom’s complaint needs a refinement.
Tom writes that city law “requires individuals who contact City officials as part of their job to register as “lobbyists with the Ethics Commission.” Under “Modes of Communication,” the fact sheet says: “A lobbying contact is any communication with a City officer to influence a local legislative or administrative action for which you are paid.” City officer, not official per se.
Who’s a city officer? The fact sheet says: “Typically City officers are high-ranking officials with significant decision-making authority. City officers include the Mayor, members of the Board of Supervisors and other City boards and commisions, and department heads.” As director of OEWD, Todd Rufo would seem to qualify.
Yesterday I spoke to Tom. I asked her why she filed the complaint.
“It seemed like the best way to expose the process,” she said. Her ultimate aim is to “stop Kilroy from buying influence by not following the rules.”
On a personal level, Tom said she couldn’t do her work—providing floral arrangements for weddings and events—without the Flower Mart. “That’s where I source all my materials,” she told me. “I like to purchase locally and work closely with the vendors.” Two weeks before a wedding, she’ll go to the market and ask vendors for advice. “They’ll tell me, ‘I don’t think you should buy that; it’s not looking good.’ I go back to my brides and suggest some changes.” Noting that the Mart is only one of five remaining wholesale flower markets in the U.S., Tom said that most florists have to buy their goods online. “People ship it to you—I can’t fathom that at all.”
But what got Tom involved in the campaign to save the Flower Mart wasn’t just the survival of her business. “I’m a third-generation small business owner,” she said, “so I identify with the people who rent space at the market.” And beyond the vendors, “there are thousands of livelihoods at stake”—the growers and their employees, the truckers who transport the flowers, her fellow florists.
“I’ve been attending the tenants association’s meetings,” Tom said, “and when I heard about Mr. Grisso’s unlawful lobbying, I wanted to stand up for my community and the people the Flower Mart represents, and see that the public interest is served.”
