“Every time a bell rings, an angel gets his wings!” A friend of mine with a wry sense of humor recently quoted that famous line from the 1946 Christmas classic It’s a Wonderful Life. We were watching the news about the arrest of longtime City Family member Dwayne Jones. “What brought that up?” I asked. “Well,” he said, “in your case it’s more like ‘every time you write a column an official goes to jail.’” He was referring to investigative reporting I’ve done about City Hall’s rampant corruption going back to 2019 that preceded FBI subpoenas, indictments, arrests, convictions, and, in the case of former San Francisco Department of Public Works boss Mohammed Nuru, a seven-year prison sentence.
In July of 2020, I wrote a column called “Friends with Community Benefits,” about corruption within the San Francisco Public Utilities Commission (SFPUC) related to a pay-to-play scheme called the Community Benefits Program (CBP), where joint venture boards, made up of firms bidding on large contracts, are “encouraged” to donate to favored nonprofits that benefit cronies in and around the SFPUC.
Sources (who asked to remain anonymous for fear of retribution) told me that SFPUC chief strategy officer and assistant general manager of external affairs Juliet Ellis decided which nonprofits would get money, and that SFPUC contractor and close pal Dwayne Jones was her go-to middleman. “Dwayne told them what nonprofit donations would help earn the best scores from Juliet,” one source explained. And, it turns out, those nonprofits were often connected to Jones.
I also exposed ties between SFPUC general manager Harlan Kelly Jr. and Walter Wong, a longtime contractor and permit expediter, who agreed to plead guilty to fraud, conspiracy, and money-laundering charges. Sources inside the agency heard Kelly bragging about how Wong was doing work on the home he shared with his wife, San Francisco City Administrator Naomi Kelly. Not long after, Harlan was arrested, and Naomi stepped down.
Still confounded by Jones’s ability to fly under the radar, I penned a February 2022 column about his years of ethical missteps and corruption, and how the city was complicit for continuing to pay him and his firms millions of dollars in contracts. For my July 3, 2023, “Gotham by the Bay” newsletter, I once again asked, “Where’s Dwayne Jones?” Less than two months later I got my answer — Jones was in jail on a $50,000 bond after being charged with bribery, misappropriation of public money, and aiding and abetting a financial conflict of interest in a government contract.
The District Attorney’s Office and the FBI announced that Jones and Lanita Henriquez, the director of San Francisco’s Community Challenge Grant Program, entered into contracts totaling more than $1.4 million and that those contracts led to kickbacks. But trust me, that’s just the tip of the iceberg: According to one source, Jones has a multitude of city employees to whom he gives kickbacks in exchange for doing his “dirty work,” including staff at the SFPUC, the Port, and the Office of Economic and Workforce Development. “I assume authorities now have the bank records for Jones and his firm RDJ Enterprises and all this will come out,” the source said. “It’s gonna be a bloodbath.”
Looking back to that July 2020 Community Benefits exposé, my track record is pretty good. “I have a feeling at some point the FBI will knock on the doors of Harlan Kelly, Juliet Ellis, Dwayne Jones . . . .” I wrote — but wait, where’s Juliet? After all, she was the mastermind of the entire Community Benefits scheme.
CHEETOS AND TEQUILA
As if this whole sordid tale wasn’t already reminiscent of a telenovela, it turns out Ellis wasn’t just Kelly’s assistant general manager of external affairs, she was his literal affair.
I first wrote about the couple in a March 2020 column regarding their frequent trips together, including a personal junket to Mexico where they snacked on tequila and Cheetos from room service. Between April 2013 and December 2018, boss and subordinate took 44 trips together at a cost of more than $130,482 — an average of eight trips together per year with an annual price tag of nearly $24,000, all billed to SFPUC ratepayers. (Not long after that column, the FBI subpoenaed their travel records.)
Ellis and Kelly go back a long way. In 2014, Kelly stood by his beleaguered deputy despite pending investigations by the San Francisco district attorney, the city’s Ethics Commission, and the state Fair Political Practices Commission about her role in awarding a $200,000 no-bid contract to Green for All, a nonprofit where she served as a paid board member and additionally received $2,000 per month as the organization’s acting executive director. Kelly said her “critical expertise” trumped those pesky ethics issues (the couple took a three-day trip to Chicago together right after those scathing reports).
Ellis resigned from the SFPUC after Kelly was arrested, but her ties to City Hall corruption are like a snake eating its tail if you follow the bouncing nonprofits. Last month, the City’s Economic Recovery unit, based within the Office of Economic and Workforce Development (OEWD), shuttered with little explanation as to why, and it was revealed that one staff member was fired. The unit was created two years ago by former OEWD director Kate Sofis who, after failure to disclose a conflict of interest and a couple of lawsuits where her name came up, stepped away from OEWD (like all City Family members, she made a soft landing, this one as managing director of the War Memorial and Performing Arts Center).
GREEN FOR ALL FRIENDS WITH COMMUNITY BENEFITS
During her short tenure at OEWD, Sofis tapped Katherine Daniel as director of economic recovery. This past March, Sofis and Daniel came off as a couple of modern-day Keystone Cops when they asked the Board of Supervisors for an additional $3.1 million for Urban Alchemy’s controversial Tenderloin Ambassadors program, plus another $3.3 million for a separate Downtown Ambassadors program. OEWD staff added a last-minute amendment to their funding request just moments before the hearing began, which set off all the supervisors, especially Shamann Walton, who OEWD had met with the day before but didn’t mention the plan to quadruple their Urban Alchemy funding request.
Just days after Sofis left OEWD for her cozy new gig at the War Memorial, Daniel also disappeared from the agency. Months later, she is still missing (her work email bounces back with a message reading, “I am on extended leave of absence from OEWD”). Sounds to me like the “one fired staffer” might be Daniel. Could there be more to this story? Perhaps, because before Daniel worked for Sofis at OEWD, she was Juliet Ellis’s program manager at Green For All — the nonprofit Ellis awarded the $200,000 no-bid contract to, served as a paid board member, and received $2,000 per month as the organization’s acting executive director.
According to sources inside the SFPUC, Daniel and Ellis worked hand-in-hand right up until the day Ellis left her powerful and lucrative gig as head of Community Benefits (an archived Green For All website lists them both under “Staff & Board”), including on projects with the recently arrested Jones, and that investigators are “now looking into Jones’s firm RDJ Enterprises and any connection to Daniels and the OEWD Economic Recovery Unit.”
Remember, when Jones was arrested, a source told me that Jones had “a multitude of city employees to whom he gives kickbacks in exchange for doing his ‘dirty work,’ including staff at the SFPUC, the Port, and the Office of Economic and Workforce Development.” Could this be behind Daniels’s extended leave of absence from OEWD, or the sudden decision to dissolve the division she led? The only way to find out is if someone starts talking to save their own slithery tail.
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