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News + PoliticsThe Ferris Wheel is about a lot more than some rides in...

The Ferris Wheel is about a lot more than some rides in the air

Chan, Peskin say any contract needs a vote of the board. The bigger issue is privatizing the parks.

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The San Francisco Recreation and Parks Department announced today that the Ferris Wheel in Golden Gate Park will be in place for another four years.

“Today’s decision was a win for fun, joy, and common sense,” said San Francisco Recreation and Park Department General Manager Phil Ginsburg.

The money from the Ferris Wheel goes to the Parks Alliance

That proclamation came after the Historic Preservation Commission unanimously voted that the wheel can stay.

But maybe not: Supervisors Connie Chan and Aaron Peskin announced just hours later that the concession can’t continue without a two-thirds vote of the Board of Supes.

In fact, Peskin told me, the City Charter is very clear. He read me Charter Section 4.113:

“No building or structure, except for nurseries, equipment storage facilities and comfort stations, shall be erected, enlarged or expanded in Golden Gate Park or Union Square Park unless such action has been approved by a vote of two-thirds of the Board of Supervisors.”

That would, presumably, apply to a giant Ferris Wheel.

The supes are set to vote next week on extending the concession for one year, not four – to March, 2022.

“A deal’s a deal’s a deal,” Peskin said.

The original contract was for one year, but after COVID, the private vendor demanded an extension.

Most of the money will go to a private nonprofit, the San Francisco Parks Alliance.

And while the supes could approve a one-year extension, “This goes beyond the Ferris wheel now, it is about good and clean government,” said Supervisor Connie Chan. “We know the revenue generated from the Ferris wheel — instead of directly going to the City’s general fund — is going to a nonprofit that is currently involved in the ongoing public corruption investigation.” 

This story is about so much more than a few rides in the air.

It about public corruption — and also about using the city’s parks as cash registers for private companies who (sometimes) kick back some money to the city.

Julina Bunim, a partner in the high-priced lobbying firm Lighthouse Public Affairs, emailed me a few days ago to say that our story about the financial arrangement between the city and the San Francisco Parks Alliance, which is linked to an FBI corruption investigation, was inaccurate:

I work with the Parks Alliance and am flagging an inaccuracy in your story.  The story states that the Parks Alliance was “counting on taking its share of about $500,000.” 

Of the Parks Alliance’s $1.9 million budget for the Golden Gate Park 150, $200,000 would be provided by revenue from ticket sales for the SkyStar Wheel, not $500,000. 

If the future of the SkyStar is approved, the revenue from the wheel will go to SFPA until the $200,000 mark is reached. Those funds will pay for any remaining Golden Gate Park 150 costs and go toward community performances at the Bandshell and Jerry Garcia Amphitheater. After that, all revenue will go to the Rec and Park Department to support interpretive signage commemorating the events of 2020; transportation access to Golden Gate Park, and to support the department. 

The email included this statement:

The San Francisco Parks Alliance wholeheartedly supports any effort by the City to increase transparency and accountability.  Every year, we undergo an independent financial audit and a city monitoring audit to ensure that we are compliant with all financial regulations. We’ve also cooperated fully with federal and local investigations and will continue to do so. We embrace this scrutiny and the increased transparency that will result from it, because SFPA does not have, and never has had, anything to hide.We welcome any discussions with the Board of Supervisors in the spirit of fighting public corruption and increasing transparency and believe that direct conversation is always more productive than attention-grabbing press releases. As a 501c3 nonprofit organization, San Francisco Parks Alliance is an open book. We will continue our efforts to make our beloved City the best, and most beautiful, it can be, and we look forward to partnering with the Board of Supervisors in that effort.

This is what the San Francisco Controller’s Office said last year, according to KQED:

The Controller’s Office found at least one of these organizations, the San Francisco Parks Alliance, took roughly $1 million in donations from a number of city contractors which were under investigation by the City Attorney’s Office for funneling money to the Public Works department for lavish parties, at the behest of former Public Works Director Mohammed Nuru, who was arrested by the FBI in January on corruption charges.

Those city contractors include the SF Clean City Coalition, Recology, PG&E, Clark Construction, Webcor Construction and Pankow Construction. They collectively donated $966,000 to the Parks Alliance into a Public Works-specific account — funds Nuru was able to freely direct, and sometimes himself was paid from — according to the report. Those same contractors were awarded more than $570 million in city contracts by the Public Works Department, according to the report.

I was a tiny bit surprised that I got contacted not by the Parks Alliance but by a partner in a lobbying and public-relations firm that charges top dollar for its work. Which suggests the nonprofit organization is paying many thousands of dollars for PR.

I say only a tiny-bit surprised because the Parks Alliance is not a tiny nonprofit; its most recent tax return shows revenue of $14 million, most of which is from grants that aren’t identified (and legally don’t have to be). The group owns almost $10 million in Wall Street securities.

But let’s get past that and to the point:

The original contract with SkyStar, the private operator of the Ferris Wheel, did not include any cap on how much money the Parks Alliance would take in. It said that the group would make $1 a ride (less for discounted rides). As Tamara Aparton, the spokesperson for Rec-Park, told me,

We entered into a contract with SkyStar for the wheel on Feb. 28, 2020.  When we issued that contract the wheel was going to run from April 4, 2020 to March 1, 2021. During that period the Parks Alliance was to get $1 from general admission tickets, 75 cents from senior and youth tickets, 6 percent of VIP experience tickets and 5 percent of concessions for the duration of the contract.  We budgeted that amount to be $200,000.  Of course, like any budget projection, if fewer people rode the wheel it would be less, if more people rode it the amount would be more. 

Right: If the vendor got what it wanted from the start of this whole deal — which is 500,000 rides — the amount would be $500,000, give or take a little depending on how much was “VIP experience” tickets and how much was concessions.

There was at that point no cap on SFPA money, just a budget.

The current contract with SkyStar also includes no cap on SFPA money.

What Aparton told me was this:

Now we are seeking a contract extension.  If we get approvals for that extension we will issue a new contract with SkyStar.  It will say that SFPA will receive $1 from general admission tickets, 75 cents from senior and youth tickets, 6 percent of VIP experience tickets and 5 percent of concessions up to $200,000.  After $200,000 all the money will then come to the Recreation and Parks Department.  This was addressed in the staff report for the contract extension.

“We were told that there is a plan to cap the amount of the contract, but it’s not in writing anywhere,” Frances Hsieh, and aide to Sup. Chan, told me.

There was no formal bidding process for this contract:

In this case, the short duration of the installation coupled with the small window to find a wheel that could be moved here made it impractical. We reached out to all operators across the country and found this one that happened to be leaving Ohio at just the right time. Our financial arrangement was the same as the other cities we surveyed.  

Okay – but I’m still not clear why the city’s share of the revenue from this venture goes first to a private nonprofit. That’s a pretty unusual arrangement – in most city contracts of this sort, the vendor agrees to share revenues with the city directly.

See, this is the bigger issue: Phil Ginsburg, the director of Rec-Park, has a long history of looking for ways to privatize the city’s parks, to make them into commercial ventures that make money.

This is another piece of that agenda. And in this case, the city doesn’t even get most of the money; a private vendor linked to a major corruption probe gets it.

No amount of PR can change that.

48 Hills welcomes comments in the form of letters to the editor, which you can submit here. We also invite you to join the conversation on our FacebookTwitter, and Instagram

Tim Redmond
Tim Redmond has been a political and investigative reporter in San Francisco for more than 30 years. He spent much of that time as executive editor of the Bay Guardian. He is the founder of 48hills.
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