San Francisco Passes ‘Sunshine’ Law, but Critics Say It Shines Little Light

The San Francisco Board of Supervisors last week approved a controversial measure to require non-profit organizations that receive at least $250,000 a year from the city to face greater public scrutiny.

The legislation, known as the “sunshine” ordinance, would force charities that received big city contracts to disclose financial information to interested citizens and would require such groups to open their board meetings to the public.

San Francisco Mayor Willie Brown has not announced whether he will sign or veto the legislation.

The final language of the ordinance represented a compromise between charity leaders, who argued that existing public-accountability measures were adequate and did not need to be expanded, and AIDS activists, who had called for more-sweeping changes.

In January, San Francisco Supervisor Tom Ammiano had proposed a measure that would have required all charities that received city money to make public a wide range of documents and to allow city-appointed trustees to serve on their boards.

After Mr. Ammiano’s measure was proposed in January, some non-profit leaders were concerned that its passage in San Francisco could lead other cities to adopt similar legislation. But they say now that the compromise version passed last week would apply to a limited number of groups and that its passage was unlikely to spark other cities to take action. Approximately 135 non-profit groups get at least $250,000 in city funds each year.

Still, neither side was very happy about the result.

“The good news is the vote was 10 to 1,” said Mr. Ammiano. “The bad news is the thing got gutted.”

From the perspective of non-profit groups, “the troubling thing was that people were motivated to ask for these additional requirements in the first place,” observed Caroline Tower, executive director of Northern California Grant Makers. “I am not convinced that there were significant abuses out there.”

Mr. Ammiano proposed his legislation after a dispute broke out between the San Francisco AIDS Foundation and a group of AIDS activists, who complained that the foundation — one of the nation’s biggest AIDS charities — had failed to provide adequate information about the group’s finances and decision-making processes (The Chronicle, January 29.)

Mr. Ammiano’s original proposal would have required any non-profit groups that received city money to:

* Open all their meetings, including board meetings, to anyone who chose to attend — except for meetings that involved personnel matters or litigation.

* Make available to the public all documents concerning charity operations, including minutes of meetings and financial papers, down to check stubs, donor lists, and detailed budgets.

* Admit city-appointed observers to their governing boards.

After the proposal was introduced, a special committee was created to hammer out a compromise. The committee, which included AIDS activists and charity leaders, agreed upon changes to soften the proposed legislation. For instance, donor lists were exempted from public scrutiny in the committee’s recommendation.

But the proposal was further amended, at the urging of non-profit groups, by the Finance Committee of the Board of Supervisors. Among the biggest changes was the addition of the $250,000 threshold, which Mr. Ammiano opposed.

“This was a compromise to the compromise,” said Mr. Ammiano, incensed by the final round of lobbying by non-profit organizations. “We were out in front with the task force, but the non-profit groups went behind the scenes to do this,” he said.

The legislation passed last week would require non-profit groups to provide members of the public with summaries of information about their budgets, which contractors already are required to provide to city officials, as well as their most recent state and federal informational tax returns. Charities were not asked to accept trustees appointed by the city to serve on their boards.

If Mayor Brown signs the legislation, proponents have pledged that they will begin to test the new requirements immediately. And if they are not satisfied with the results, said Jeff Getty, a member of ACT-UP (Aids Coalition to Unleash Power), who was one of the principal architects of the proposal, “We are going to take it right back to the Board of Supervisors or to the ballot.”

If Mayor Brown does not sign the legislation, supporters plan to put forward a ballot initiative that would create a “sunshine” law that would be tougher than the version passed last week. Already, representatives of ACT-UP and the Harvey Milk Lesbian, Gay, Bisexual Democratic Club have registered their intention to lead a petition drive to have a “sunshine initiative” decided by referendum in November.

Some charity leaders and foundation executives said that such a referendum might actually be a good thing for non-profit organizations.

Kirke P. Wilson, executive director of the Rosenberg Foundation, said that most San Francisco non-profit leaders have failed to become involved in the debate over the legislation. But a referendum would force charities to defend their organizations from increasing government regulations, he said.

“It would be a good thing, because most non-profits have their heads down, always working at the limits of their resources,” said Mr. Wilson. “This would force them slowly out of that mentality.”

But for numerous other non-profit officials, the whole subject of “sunshine” is a pointless distraction from the ongoing struggle to deliver services.

Jim Illig, who oversees government-contract relations for Project Open Hand, a San Francisco charity that provides services to people with H.I.V. or AIDS, said that charities routinely provide a great deal of financial information to government officials and members of the public.

Mr. Illig also said that his organization’s monthly board meetings are already open to the public, without any requirement from the city government. But even though they are advertised regularly in local newspapers, he says, “nobody has ever come.” “The troubling thing was that people were motivated to ask for these additional requirements in the first place.”