Supervisor's Report

Stopping the dark money game

Progressive campaigns bankrolled by taxpayer-funded affordable housing scam

A recent article from the san Francisco Chronicle brought to light a local “affordable housing” developer who has been donating hundreds of thousands of dollars of dark money to ballot measure campaigns right here in our backyard. This local “affordable housing” developer, John Elberling, freely admitted to the Chronicle that he raked in millions in profits from refinancing his group’s “affordable housing” properties that were built with a mix of taxpayer subsidies. In the 2016 campaign season, Elberling’s organization has already spent more than $385,000 on local political campaigns, all backed by supervisors Aaron Peskin and Jane Kim.

What’s wrong with this picture? A ton.


First of all, despite the outsized influence of private money in political campaigns, using taxpayer dollars for political purposes is flat-out illegal. Elberling and his organizations are currently being investigated by the California Fair Political Practices Commission, and a complaint was filed with the San Francisco Ethics Commission as well.
More important, it’s reprehensible for a developer to hide behind a cloak of building “affordable housing,” only to strip these affordable housing projects of sorely needed maintenance dollars to fund his pet political campaigns.

Elberling’s “affordable housing” properties have multiple complaints on file with our Department of Building Inspection for poor maintenance, including complaints from low-income seniors who have not received hot water for months at a time. In addition, tenants in his buildings also claim that they fear coming forward with their complaints and issues because of threats and the fear of being evicted.


Second, Elberling is making all of his campaign contributions through a shell entity – the Yerba Buena Neighborhood Consortium LLC (YBNC), which currently escapes disclosure requirements for the source of funds. Until the U.S. Supreme Court reverses its Citizens United decision, our best tool is to require disclosure of all donors, and by funneling all political contributions through YBNC, Elberling has been attempting to skirt our local disclosure laws.


The bottom line? A local “affordable housing” developer is using taxpayer funds to refinance “affordable housing” properties funded by taxpayers, and using the proceeds to fund local political campaigns, which he is funding through a shell LLC to avoid disclosure requirements. His dark mon-ey is supporting Propositions C, D, H, L, M, and X and is opposing Propositions U and P.

I will be promptly introducing legislation to close these current loopholes for good, and I have called for an immediate investigation of Elberling’s activities by the United States Department of Housing and Urban Development (HUD). Whether his “affordable housing” projects were funded through local, state, or federal HUD dollars, as taxpayers we all have an interest in making sure our taxpayer funds are spent effectively and for their proper purpose — not siphoned off for political campaigns.


Moving forward, any affordable housing project funded with local dollars in San Francisco will be restricted from using refinancing proceeds for anything other than capital improvements to existing affordable housing buildings, or the purchase of additional affordable housing projects. Affordable housing developers should be in the business of acquiring, building, and maintaining affordable housing, not bankrolling political campaigns. In addition, LLCs will be forced to disclose the sources of their own political funding.

I will not stand by and let this type of questionable activity continue. As chair of our city’s Budget and Finance Committee, I take my fiduciary responsibility extremely seriously. With finite and limited taxpayer dollars, it’s our responsibility as elected officials to ensure taxpayer resources are being spent efficiently and wisely, and especially not on political purposes.

There will be more to come on this topic, but in the interim, please join me in opposing all of the campaigns which Elberling is attempting to influence through his affordable housing scam. Please vote no on Propositions X, D, H, L, and M and vote yes on Propositions U and P.
San Francisco deserves better.

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