San Francisco is easing financial reporting requirements for city-funded nonprofits after some raised concerns that making such information public could put their staffers at risk of harassment, threats, or attacks.
The requirements were initially meant to increase transparency around nonprofits’ expenses, leaving one government ethics expert worried that rolling back the disclosures could make the city more vulnerable to financial mismanagement—an issue that has plagued its departments and nonprofits for years.
San Francisco supervisors voted unanimously Tuesday afternoon to approve the changes, which are intended to protect employees at nonprofits, particularly those who serve the LGBTQIA+ community and survivors of domestic violence.
“As the mood of the country changed and particularly queer organizations found themselves under increasing and often violent threat, folks approached me about amending [the] legislation to provide some protection for those organizations,” Board President Rafael Mandelman said when introducing the amendment to the Rules Committee in March.
The 2023 reporting protocol requires a list of the names of executive directors or employees with managerial responsibilities, as well as the names of the nonprofit’s board members or officers and any other boards they serve on.
The changes passed Tuesday remove more than half of the information that’s required to be disclosed, expand how much data can be redacted, and raise the funding threshold that requires a report at all.
Rocio Molina, the director of San Francisco’s Human Services Network, said people could be dissuaded from choosing to serve on boards at some nonprofits if it meant their personal information would be shared.
“Many of them reflect the communities they serve, and they bring true value to the work and the information that our nonprofits are able to collect and put together,” Molina said. “Losing them can be a real loss to the sector.”
However, Sean McMorris, a program manager at the government transparency nonprofit Common Cause California, said not disclosing that data could compromise government accountability.
“I understand their concern; I just don’t know if how they’ve done this is the right way to go about addressing that concern because it appears to be addressing one problem by ignoring another, which is the public’s right to transparency,” he said.
Multiple city-funded nonprofits have been mired in scandal for misusing city funds or unfairly awarding grants to agencies with which they have personal ties.
SF SAFE, which was tasked with many of the Police Department’s community-oriented initiatives, was disbanded last January over ethics concerns.
Its leader, Kyra Worthy, was later arrested on fraud charges over allegations that she misused $700,000 in city money.
In the fall, former Mayor London Breed’s trademark “Dream Keeper” initiative also came under fire after reports that then-Human Rights Commission head Sheryl Davis awarded $1.5 million to the nonprofit Collective Impact, whose chief she shared a home with.
Davis was also accused of frivolous company spending on a Martha’s Vineyard vacation rental for interns and overpaying another nonprofit, the Homeless Children’s Network, by $40,000.
McMorris said that knowing who is leading the organizations that benefit from city funds is important information—for the press and voters.
In addition to politicians’ family members and friends, he said that “boards of directors are often prominent people who have interest within the city.”
“Whether they’re developers or lawyers or in the tech industry, they’re typically going to have [legislation] before the Board of Supervisors that affect their interest and their bottom line,” he said. “It’s really about accountability.
There’s a lot of things that are legal and are forms of government, but not necessarily appropriate or ethical.
That’s where transparency comes in and allows us to hold our public officials accountable based on what they do, even if it’s legal.”
He said the state allows employees’ addresses and other contact information to be redacted when there is a viable threat, but he has concerns that the city’s ordinance is too broad, comparing its language on redactions to writing a “blank check.”
“It doesn’t say what the reasonable basis to believe that harm could occur would be, so it’s kind of an open-ended thing,” he told KQED.
“I think an agency can say, ‘Well, we essentially have this concern,’ and frankly, why wouldn’t an agency say that, just to be safe?”
The amended legislation also cuts the reporting of some other IRS documents and a program-by-program description of all funds expended or budgeted.
Only nonprofits receiving more than $1 million in city funds will have to file the statements at all, a ten-fold increase from the $100,000 minimum in the original legislation.
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