A settlement that was struck two weeks ago between mayoral candidate Mark Farrell and the San Francisco Ethics Commission was made public this morning, in something of an Election Eve surprise.
One of the only scandals to emerge in the 2024 race for San Francisco mayor has had to do with how the Mark Farrell campaign appeared to be playing fast and loose with campaign finance rules when it came to the committee Farrell founded to support Proposition D. The Chronicle’s Emily Hoeven broke the story back in August, discovering that the Yes on D committee was paying about half of the rent for Farrell’s West Portal campaign headquarters, yet the campaign headquarters didn’t appear to be doing any work for the Yes on D campaign.
The two committees were also sharing a significant amount of payroll expenses, and as SFist previously reported, multiple Yes on D mailers appeared to be doubling as Farrell-for-Mayor mailers.
This was particularly problematic because committees supporting ballot measures can accept unlimited-sized donations, while campaigns for individual offices have a $500 donation limit.
Mayor London Breed, who had previously endorsed Prop D — which would slash the number of commissions at City Hall by half — withdrew her support, citing the Chronicle’s piece and the likelihood that the campaign was just a “slush fund” for Farrell’s campaign.
At that point, a complaint had already been filed about this with the Ethics Commission by former ethics commissioner and former supervisor Quentin Kopp. (In early October, three former mayors of San Francisco, Willie Brown, Frank Jordan, and Art Agnos, all called for a criminal investigation into the campaign.) The Chronicle also noted that this wasn’t the first time that Farrell and his wealthy donor friends had run afoul of city ethics rules. In 2016, he paid a $25,000 fine, negotiated down from $191,000, over a similar issue of a PAC illegally coordinating with Farrell’s campaign for supervisor.
Now, as Mission Local and the Chronicle report, via this newly added agenda item for the Ethics Commission’s November 8 meeting, Farrell and the commissioners reached a settlement on October 25 that would have him pay $108,000 this time around, for illegally sharing funds from the Prop D committee with his mayoral committee.
The Yes on D committee raised a total of $2.5 million, while Farrell’s campaign raised only $1.6 million, but a separate “Yes on D, No on E” committee raised another $7 million on top of that. And the Ethics Commission’s investigation found multiple examples of emails from the Farrell campaign that suggested a commingling of funds, saying things like “If you are interested in further financially supporting Mark, he has opened a ballot measure committee that can accept contributions.”
“If approved, this case represents the largest penalty issued in the history of the San Francisco Ethics Commission,” says the commission’s enforcement director Olabisi Matthews in a statement. “This record penalty reflects the serious harm that was done to the public’s right to have timely and accurate information about how campaigns are funded in San Francisco, [and] the severity of violating the $500 contribution limit, which is one of the most basic rules that all candidates have to follow.”
Farrell put out a statement Monday, suggesting that he had fired the lawyer to whom he had repeatedly referred when saying he’d been told that all of the campaign financing was above-board. “We agreed to a settlement for an accounting error that we corrected and publicly disclosed months ago, and over a disagreement about staff time allocation during the campaign, which led us to terminate our prior legal counsel for this matter,” the statement says.
“As the person responsible for both campaigns, I take full ownership of these issues — this is kind of accountability I am modeling for my children,” Farrell added.
The Ethics Commission still has to vote on approving the settlement at its November 8 meeting.
Previously: SF’s Prop D Hopes to Eliminate Most City Hall Commissions, Critics Say It’s Just a Mark Farrell Slush Fund