Supervisors press DBI, city attorney after hearing on 30 illegal units at 2867–2899 San Bruno Ave

A prolonged hearing on Sept. 13 before the Land Use & Transportation Committee focused on allegations that developers built 30 units at 2867–2899 San Bruno Avenue despite permits and approvals for far fewer units and that Department of Building Inspection (DBI) oversight failed to detect the changes.

Supervisor Catherine Ronan, who called the hearing, said the case exposed both an individual and systemic failure: “In 2019, my office was informed … that 30 units were constructed illegally at the site,” she said, describing a chain of violations that included altered egresses, changed staircases and the conversion of open space to parking. Her immediate priority, she said, was tenant safety after the violations were discovered and enforcement began.

Corey Teague, the Planning Department’s zoning administrator, told the committee that Planning first flagged the problem when a property owner sought to convert an approved on-site affordable unit to a fee and that a subsequent site visit revealed the broader scope of work. DBI interim director Joe Reardon said his office responded with enforcement, audits and reforms once the irregularities were identified and added: “I’m outraged by what happened here.”

Committee members focused on DBI recordkeeping and the role of a senior inspector. DBI officials said final inspections for the five buildings in the permit set were entered into the permit-tracking system but that intermediate inspections commonly performed during construction were not recorded; DBI said it has no contractor job-card evidence proving those intermediate inspections occurred. Officials also acknowledged that senior inspector Bernard Curran performed the project’s final inspections and later was criminally indicted in a different fraud matter; DBI said it is auditing projects that Curran and others inspected.

The City Attorney’s Office outlined the civil case it filed and the settlement it negotiated. Deputy City Attorney Peter Keith said the office pursued civil remedies (including claims under state unfair-competition law) and described a settlement with a punitive component reported to be about $1.2 million. Keith also explained the office’s reliance on attorney–client privilege during an ongoing investigation: “The privilege here belongs to the city, and it belongs to the Department of Building Inspection,” he told supervisors, and said disclosing details publicly could jeopardize an active probe.

Supervisors questioned whether the settlement and existing civil remedies are adequate to deter wrongdoing. Supervisor Ronan and others argued that a $1.2 million civil payment would be insufficient compared with possible rental profits and the public safety risk to tenants, and they urged criminal referrals when warranted. The City Attorney’s Office said it can pursue criminal charges only through the separate criminal process and that its civil settlement was calibrated to reflect what a court would likely award.

Planning staff said the property owner will also face planning enforcement: planning enforcement and abatement fees (about $40,000) are separate from the city-attorney settlement, and an estimated affordable-housing fee tied to legalization could be roughly $1.5 million (including interest) under current code calculations. Planning confirmed a conditional-use application to legalize additional units was expected to come before the Planning Commission; the commission will have discretion to approve, condition or deny legalization.

Fire and DBI described temporary life-safety measures taken in 2019 to protect occupants while enforcement proceeded, including 24-hour fire watches and a temporary exterior fire escape (scaffolding). DBI said it relied on those measures to avoid immediate displacement while pursuing permanent abatement; the department said a forensic structural review and interior openings could be required when the owner applies to legalize the work.

Public commenters and civic groups urged independent, forensic structural review of the project; stronger, system-level DBI reforms; more transparency from the City Attorney’s Office; and routine referral of implicated contractors and engineers to state licensing boards. Several callers said similar illegal-construction patterns have appeared across the city and called for legislative changes to increase penalties and incentives for whistleblowers.

The committee voted to file the hearing record and directed follow-up: supervisors requested closed-session briefings where legally appropriate, additional documentation from DBI and the City Attorney’s Office, and further consideration of legislative options to strengthen civil penalties and referral practices. The committee also noted an imminent controller’s report on DBI operations and the department’s ongoing internal audits and reforms as next steps.

What’s next: The owner’s conditional-use request to legalize some or all of the units will go to the Planning Commission; DBI said it will verify structural and life-safety compliance as part of any abatement/permitting process. The City Attorney indicated civil and potential criminal investigations are continuing but withheld details citing privilege.

Sources: Transcript of the Sept. 13, 2021 Land Use & Transportation Committee hearing; direct remarks by Supervisor Ronan, Planning zoning administrator Corey Teague, DBI interim director Joe Reardon, and Deputy City Attorney Peter Keith appear in the committee record.