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Civil Grand Jury reports (Volume 1976-77) online

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one of the following health plans: 1) City Administered, 2) Kaiser
Foundation, or 3) Children's Hospital. The City payment covers the
employee only and pays for medical care. Eight of the ten most
populous counties in California subsidize medical care for the
employee's dependents as well as for the employee; they also provide
subsidized dental care. Charter revisions would be necessary to
provide such coverage for City employees.

City employees have desired subsidized dental coverage for
several years, but the voters have not yet provided enabling legis-
lation. Therefore, employees will pay for a dental plan themselves,
with no City contributions, effective July 1, 1979. In a strictly
advisory capacity, the Health Service System analyzed the benefits
and rates payable for several dental plans; the Health Service Board
then determined that Safeguard Health Plan was the best for City
employees. Employees covered by the Retirement System may choose
whether to participate in the plan. If they so choose, premiums will
be paid by payroll deductions. Retired City employees who desire
this dental coverage may choose the coverage by authorizing that the
premiums be withheld from their retirement checks. Mr. Kearney,
Executive Director of the Health Service System, will personally do
the necessary coding to implement initial enrollment. Thus, the
retired employees' voluntary dental coverage under this plan should
be effective in approximately September, 1979.

The automation of the Health Service System is nearly com-
plete. Funds from the System's Reserves account paid for the imple-
mentation of the new system. When it is completely effectuated, it
should save processing time on Plan I (City Administered) claims.

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HEALTH SERVICE SYSTEM (continued)

Phoenix Mutual has been dropped as the carrier of Major
Medical benefits under Plan I because the company's new rates were
too high. The Health Service System will assume the entire risk
for major medical benefits under Plan I and will process these
claims .

Because of new regulations by the Department of Labor,
Public Service Employees ,who have participated in the CETA program
for eighteen months or more, will be terminated September 30, 1979.
Therefore, the Health Service System will lose four or five employees,
including the mail man. Some of these employees may be replaced by
new Public Service Employees, but in any case, the Grand Jury recom-
mends that the Health Service System be provided with a permanent
position for a mail person. We think it extremely inefficient that
a $40,000,000 insurance company should be expected to operate with-
out the services of a permanent mail person. We also recommend that
the Health Service be provided with additional office space; card-
board boxes which hold files on the top of filing cabinets is an
example. It would be foolish to provide new filing cabinets unless
there is space to hold them.

We compliment the Health Service Board members on their
cooperation with each other and on the business-like manner in which
they conduct their meetings, the Retired Employees of the City and
County of San Francisco for their continued interest and helpfulness,
and the employees of the Health Service System for their hard work
and their attention to the necessity of privacy when dealing with
medical records.



RETIREMENT SYSTEM



The Retirement System, through Mr. Daniel Mattrocce,
Secretary-General Manager, under the direction of the Retirement
Board, has exclusive control of the administration and investment
of the funds derived from contributions of member employees, who
numbered 26,188 on June 20, 1978, and from contributions of the
City and County of San Francisco. Temporary employees are excluded
from membership in the system and therefore are not covered under
Social Security for this temporary City employment, either.

The City's contribution to the System is paid into the re-
tirement fund each pay day; the employees' share takes six to eight
weeks to reach the fund. However, the Comptroller earns interest
on these funds from the first day. The Retirement System is current-
ly negotiating with the Treasurer about the collection of this
interest. This interest on employee contributions should be de-
posited in the Retirement Fund.



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RETIREMENT SYSTEM (continued)

In San Francisco, Retirement System costs are financed over
the average working lifetime of an employee — fourteen years after
retirement. Therefore, San Francisco, unlike some other cities,
is not spending current income to cover payments it has already
made to employees who have been deceased for several years.

Retirement System investments as of March 31, 1979 were
as follows:



Bonds and Notes
Real Estate Equity
Stocks



683,718,417.53

40,000,000.00

204,246,167.16

927,964,584.69



Bonds are not floated until the Retirement Board gives
its financial statement; therefore such a statement is given every
time a bond issue is pending.

Investments are made based on geographical diversity, life
expectancy, rate of return, and the limitation on the amount of the
Retirement Fund that can be invested in a single part of the port-
folio. In 1978, the System first invested in real estate via a
limited partnership. The return on the investment is expected to
be between 8.5% and 8.8%. The recent suggestion that Retirement
System funds be invested in low cost housing will be evaluated by
the Retirement Board when a written proposal containing information
regarding the rate of return on the investment and identifying the
title holder of the involved property, is received.

Worker's Compensation claims are also processed by the
Retirement System. Every City employee is covered by Worker's
Compensation. Because of the high incidence of injuries by tempo-
rary employees, pre-employment physical examinations are required
of all temporary employees, including those in the CETA program,
effective February 9, 1979. Brian Narlock, Claims Manager, is res-
ponsible for the administration of Worker's Compensation claims.
His staff works at the Franciscan Treatment Room in St. Francis
Hospital. This is the place where most City employees are treated
for industrial injuries; in 1973, employee groups decided they no
longer wanted to go to San Francisco General Hospital for treatment.
Furthermore, costs to the City are less at the Franciscan Room than
they were at San Francisco General Hospital. In late 1978, the
Worker's Compensation department had one bill clerk to handle 15,000
unpaid medical bills. Since then, with the help of CETA employees,
the backlog has been reduced. Increased automation in some of this
department's procedures would save employee time and effort. For
instance, checks to entitled employees are prepared by the computer
without an address, so the staff at the Worker's Compensation de-
partment must address the envelopes. If addresses were printed,
window envelopes could be used. In fiscal year 1978, the City paid
approximately $6,000,000 in Worker's Compensation claims. The amount

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RETIREMENT SYSTEM (continued)

paid increases about 17% per year. That the City has no organized
Safety Committee and that the Municipal Railway has a deferred
maintenance plan contribute to the number of job injuries.

Regarding disability decisions rendered by the Retirement
Board — 90% of the denied cases that are appealed to the Court
result in reversals of the Retirement Board decision. Therefore,
it appears inappropriate to hire an independent hearing officer
to replace the Retirement Board in an effort to decrease the number
of disability retirements allowed.

The Grand Jury recommends that the Retirement System be
made a formal trust so that funds will remain protected for the
retirement of City Employees, that the Retirement Board become
its own budget setting authority, and that the Retirement System
be allowed to offer options, if necessary. These changes will re-
quire Charter Amendments.

Commendations to the Retirement Board for conducting
meetings in an organized manner and for showing respect to the
employees involved. Mr. Dan Maguire of the City Attorney's office
also exhibited extreme fairness and thorough preparation at these
meetings. Finally, thanks to Mr. Mattrocce for sharing his ex-
periences and insights as a veteran City employee with us.

CIVIL SERVICE COMMISSION

The Personnel Department is responsible for rendering
service to departments and employees through the implementation
of salaries and the examination, selection and appointment of em-
ployees. This department is managed by John Walsh, under the
authority of the Civil Service Commission. The Commission is com-
posed of five members, all of whom are appointed by the Mayor;
Carlotta del Portillo and Allen Haile were appointed in 1979 to
replace two Commissioners who resigned their positions.

The Civil Service System in the City is archaic; budgetary
and Charter restrictions prevent the department from operating in
a modern manner. The budget for the fiscal year, beginning July
1, 1979, is 78% of the budget for the year beginning July 1, 1977.
The number of employees in the department ranks 212th of the 238
cities surveyed. There is one training officer for 25,000 City
employees. As long as these conditions exist, there will continue
to be a long time between examinations. The line item budget used
in the City is another cause for the long delay between a depart-
ment's request for an employee and receipt of the employee. The
FIRM accounting system which will be effectuated during 1979-80
should greatly alleviate this problem.

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CIVIL SERVICE COMMISSION (continued)

In spite of these conditions, the Civil Service Commission
has made progress in achieving the following goals:

1. Proposition B, approved by the voters in November,
1978, allows performance evaluations to be considered in promotions,
allows the Civil Service Commission to review and take action on
discrimination allegations against appointing officers, allows the
Civil Service Commission to continue test procedures in spite of
certain protests, and extends the probationary period for new
employees .

2. Civil Service rules are being updated at the rate of
two rules every three months .

3. The performance evaluation system will be effective
July 1, 1979.

4. The conversion of time roll audit and certification
to electronic data processing should be complete by October, 1980.

5. Pre-employment physicals are now required for all new
employees, including temporary and CETA employees.

6. Per the Comptroller's Office, "anticipated" time rolls
should be eliminated in September or October, 1979.

Other important items include the following:

An appropriate Annual Supplementary Affirmative Action
Plan for Equal Opportunities, which includes goals and timetables,
should be effectuated promptly. Such a plan was referred to the
Commission by staff on March 20, 1978 . To date, a plan has not been
adopted. If the Board of Supervisors and the Civil Service Commission
agree, the City may have a plan by November.

The current entry level examination for Q2 Police Officers
should be re-evaluated. The test has not been technically updated
since 1974. Parts of the test should be eliminated. Of the 162
items on the present test, only 107 will be used to determine the
score. Correct answers to 60% of these items is passing. Thirty
items on "Report Writing" will be used in scoring the test, but
only five of the 15 questions on reading comprehension count in the
scoring.

Because of the many complaints about the police applicants'
inability to see and/or hear the film at the various test locations,
Mr. Walsh has assured the Grand Jury that if an audio visual test is
used again in future years, the test will either be administered at
a single location which has adequate equipment, or new equipment for
showing the film will be rented.

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CIVIL SERVICE COMMISSION (continued)

Many employees and some supervisory personnel do not have
an adequate understanding of the City's Civil Service regulations.
Employees often depend on their unions for knowledge of their
rights and responsibilities. They are not aware, for example,
that the Charter prohibits night time differential and time and a
half overtime pay for members of the Police and Fire Departments.

Some supervisors are apparently unaware that the Depart-
ment of Public Health and the Department of Social Services, rather
than the Civil Service Commission, are responsible for entry level
tests for their own employees. Negotiations are currently underway
for the Airport and Police Commissions to have responsibility for
tests for entry level positions in those departments.

Also, if a department requests that a potential employee
not be appointed due to the results of a background investigation,
the investigation must have been conducted in a thorough manner;
the results presented to the Civil Service Commission must be proven
facts rather than allegations. The Grand Jury recommends that
Civil Service be funded and staffed so that a Civil Service news-
letter can be issued regularly; the newsletter should explain Civil
Service rules accurately and as simply as possible.

There is an ordinance before the Board of Supervisors
which could be approved by July 1, 1979. It would provide that all
full time temporary employees (with five years of service) would
become members of the Retirement System and Health Service System.
These employees would still be considered temporary for pay purposes.

The situation of the other temporary employees (about
6,000) should be improved. These people perform work for the City,
but are not members of either the Health Service or the Retirement
Systems; their pay is for the Step I (lowest) grade of their class.
The permanent staffs of the departments should either be increased
or the unused money from the permanent accounts should be used to
fund temporary jobs rather than giving the departments special funds
for temporary employees. There are some cases in which this recom-
mendation should not apply, i.e., employees who are really tempo-
rary - those that are employed for six months or less.

The Grand Jury also recommends that public meetings of
the Civil Service Commission should begin at a scheduled time,
proceed with efficient speed, be conducted in a manner which exhibits
respect to the participants, and always be equipped with an operating
microphone.

The final recommendation of this Jury is that the Civil
Service Commission be allocated seven additional personnel to staff
a test validation unit. When this unit is operational, the depart-
ments' criticisms about the reliability of Civil Service tests

-38-



CIVIL SERVICE COMMISSION (continued)
should be extensively reduced.

Our commendations to Mr. Walsh for his cooperation with
the Mayor's Office of Employment and Training and with the Chief
Labor Negotiator of the Employee Relations Division, as well as
his efforts to personally visit City departments to learn about
their problems with Civil Service.

PUBLIC SERVICE EMPLOYEES - CETA



Because the Mayor's Office of Employment and Training
(MOET) is principally funded by the Federal Government, civil grand
juries do not usually report on it. However, due to the Labor
Department's regulation that certain employee participants in the
Public Service Employees program will be terminated on September
30, 1979, and the corresponding complaints by City Departments
that they will lose necessary employees due to this regulation,
this Grand Jury visited Mr. Bob Won, Coordinator of the Public
Service Employees Division. We learned that:

1. Mayor's Office of Employment and Training is funded
by the Department of Labor, through the provisions
of the Comprehensive Employment and Training Act -
CETA. MOET is called a prime sponsor.

2. Public Service Employees program is part of the
CETA program. It provides training and job place-
ment in public agencies and private, non-profit
agencies for eligible persons who are unemployed
due to "bad times" (the general economic situation)
or due to being either unskilled or structurally
unemployed. The structurally unemployed are those
who are skilled for a specific job, but who are un-
employed because positions in their fields of skill
are not locally available.

The City and the School District currently have
approximately 2,600 Public Service (CETA) employees .

3. The Department of Labor determines the amount that
a prime sponsor receives for this program. The
amount is based on the unemployment rate. In
fiscal 1978, the Mayor's Office of Employment and
Training received $33,000,000 for the program;
this money funded jobs in City, State and Federal
Government and in private, non-profit agencies.

4. Persons employed through this program receive the
benefits due other temporary employees. Therefore,



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PUBLIC SERVICE EMPLOYEES - CETA (continued)

when they work for the City, CETA's are not
members of the Health Service System or the
Retirement System and are not covered by Social
Security.

5. The Public Service Employee (CETA) receives the
same pay as other employees in Step I of the same
classification. The amount of salary that is not
funded by CETA is paid by the employer,

6. The
19

CETA position, out. it win not pay more than
$8,935 average to fund all the CETA employees hired
after April 1, 1979 through a single prime sponsor.

7. Effective September 30, 1979, all persons who have
been employed through the Public Service Employees
program (CETA) for at least eighteen months, will
be terminated from the program. Therefore, the
City and County of San Francisco will lose approxi-
mately 2,00 CETA employees.

8. The program is regularly monitored by the Depart-
ment of Labor and was audited by the General
Accounting Office three years ago.

9. Some positions that are currently filled by CETA
employees who will be terminated on September 30,
1979, will thereafter be filled by CETA employees.
However, due to the average $8,935.00 that the
Department of Labor will fund per position, most
future CETA employees will fill the lowest paying
City positions. For example, there are currently
110 members of the Transit Police Force; all except
one of these are CETAs . Seventy of them will be
laid off on September 30, 1979. They each received
a salary of $13,200.00 effective July 1, 1979.
Therefore, if all 70 vacant positions were to be
funded through the CETA program, approximately 420
junior clerk positions would have to be funded by
CETA in order to maintain the Department of Labor
"average" provision.

It appears that the City may be using the Public Service
Employees (CETA) program to save salary money rather than to achieve
the goals of the program.



-40-



PUBLIC SERVICE EMPLOYEES - CETA (continued)

Our thanks to Mr. Won for his patience and cooperation.



Frank Harrison

Blossie C. Williams

Elizabeth A. Dowd, Chairman



-41-



CHIEF ADMINISTRATIVE OFFICER

The office of the Chief Administrator of the City and
County of San Francisco seems designed to provide the amalgamating
force which can bring cohesive and cooperative order to many of the
City's important "housekeeping" departments. This, however, comprises
only a part of the responsibilities with which the CAO is charged.
There are special projects under his jurisdiction ( such as the Moscone
Convention Center, waste water management and solid waste disposal)
as well as division of funds from the hotel tax and managing the
City's insurance program, while also maintaining positions on the
Planning Commission, the Capital Improvements Advisory Committee,
Refuse Collection and Disposal Rate Board, EDP Priority Committee,
and the California Academy of Sciences. It is obvious that the proper
functioning of this office requires superior executive ability. The
CAO is appointed by the Mayor, subject to confirmation by the Board
of Supervisors, and serves at their pleasure for a period of ten
years.

Mr. Roger Boas was appointed Chief Administrative Officer
during the 1976-77 fiscal year, and in the past year appears to have
made considerable strides in bringing the diverse duties of the office
under better control pointing toward increased efficiency and progress
for the City.

A great attribution toward this goal has been his aiding
in the resolution of legal difficulties which have beset the Yerba
Buena Project (now named George R. Moscone Convention Center) and
prohibited the sale of revenue bonds to finance completion of the
project. This is no small accomplishment when it is realized the
project was first proposed 24 years ago, and for the period from
January, 1977 to June 30, 1979 alone the sum of $835 > 000 in legal
fees has been paid (including anticipated payments). Payment includes
services of the City Attorney's office, fees to the firm of Morrison
& Foerster relating to trial expenses, and fees for bond counsel to
the firm of Orrick, Herrington, Rowley & Sutcliffe. Once the legal
cases in which the project was entangled were resolved, the bonds
could be marketed. They received an A rating, went on sale April 11th,
and the entire issue amounting to $97 million was over subscribed.

Mr. Boas has since turned more attention to the waste water
management and sewage disposal projects in support of the Plans of
the Department of Public Works and Planning Commission to wire approv-
al of the State Coastal Commission. This approval was obtained
June 6, 1979 subject to strict conditions set by the Coastal Commis-
sion. The CAO's office is currently working to determine the proper
interpretation of the language used to set out the requirements of
the Coastal Commission in an effort to facilitate meeting their
conditions.

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CHIEF ADMINISTRATIVE OFFICER (continued)

The CAO was criticized in the 1977-78 Grand Jury report
for not providing sufficient communication opportunities between
himself and department managers under his jurisdiction. In an effort
to meet this criticism and improve the then existing procedures while
endeavoring to manage his own time as efficiently as possible, he
has made the following changes in informal reporting to him of each
department. Weekly written reports are given to the CAO from brief
written reports provided by each department head and which are chan-
neled as follows:

Public Administrator/Public Guardian}

Registrar /Recorder ) via Wallace Wortman,

Agriculture/Weights & Measures ) Head of Real Estate

Purchasing j Department

Real Estate )

Coroner ) via Dr. Mervyn Silverman,

Public Health ) Head of Dept. of Public

Health

Electricity ) via Jeffrey Lee, Acting

Public Works ) Director Appointed Head

of the DPW in the Past

Year

Weekly reporting meetings are held with the CAO.

For the most part, this updated procedure seems to be work-
ing more satisfactorily. In the event there are questions with regard
to the weekly reports of the department heads or last minute changes
or additions, the CAO or a member of his staff is always available
by telephone, as well as the department heads.

Two additional measures toward greater efficiency, as
suggested in the previous year's Grand Jury report and approved by
the electorate in last November's election, will be instituted at the
beginning of the new fiscal year. The Tax Collector is removed from
the jurisdiction of the CAO and placed with the Treasurer, and the
County Clerk is removed from the CAO's office and placed under the
jurisdiction of the Superior Court.

There has also been criticism of the CAO in the public press
contending that he is proposing Charter amendments designed to expand
his "executive suite". It should be made clear that no new positions
are being requested, rather that certain currently designated Civil
Service jobs be made appointive. This is an effort to bring into
City Management at the upper levels, especially in the Departments of
Public Works and Public Health personnel of professional capabilities
to improve the over-all performance of those departments. It should
be noted here that specifically in the instance of the Department of
Public Works this is one of the results of recommendations made by

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CHIEF ADMINISTRATIVE OFFICER (continued)

the firm of Touche Ross & Co., which was employed to provide an objec-
tive analysis of the department directed toward its long-term effi-
ciency and effectiveness and which, Touche Ross & Co., states, if
implemented could provide an annual net benefit of approximately



Online LibraryCalifornia. Grand Jury (San Francisco)Civil Grand Jury reports (Volume 1976-77) → online text (page 26 of 32)