A high San Francisco tax official “abused her place” to improperly steer a profitable $10 million contract coping with town’s $2.6 billion in enterprise taxes towards a detailed pal’s firm, in accordance with an explosive metropolis audit.
The joint report by the Metropolis Legal professional’s Workplace and the Controller‘s Workplace discovered Chief Assistant Treasurer Tajel Shah used her highly effective position to learn Mechanical Orchard, a tech agency competing for a contract to exchange town’s growing old enterprise software program. The audit largely confirmed allegations first raised by The San Francisco Customary final yr.
Shah, who was suspended after The Customary’s investigation triggered a number of critiques, in the end left metropolis authorities late final yr and Mechanical Orchard deserted its pursuit of the contract. In a farewell letter to colleagues, Shah introduced her retirement after 17 years with town, saying she was pleased with the workplace’s accomplishments and grateful for her public service profession.
The audit discovered Shah improperly participated in contracting selections involving Mechanical Orchard regardless of private relationships with firm officers, together with former chief income officer Roque Versace, whom she had described as a pal. Investigators concluded her actions created at the least the looks of favoritism and undermined the integrity of the procurement course of.
“The cases wherein Shah instructed TTX employees to behave in ways in which benefited Mechanical Orchard have been so quite a few, it seems that she supposed to selectively help the agency in violation of metropolis legislation and coverage,” auditors wrote.
In an interview with The Customary, Shah in contrast Versace to a pleasant enterprise acquaintance like some other metropolis contractor, however a Fb publish from 2017 exhibits that Shah commented on a photograph of Versace’s household by writing, “My favourite peeps!”
San Francisco has been rocked by a slew of scandals at Metropolis Corridor in recent times, together with the head of the Human Rights Fee being charged with crimes and the previous Public Works director — who was in comparison with a gang assassin and drug seller when sentenced to seven years in jail — was concerned in a sprawling corruption racket.
The findings mark a dramatic fall for one of the vital highly effective bureaucrats in San Francisco authorities and lift new questions on oversight inside Treasurer José Cisneros’ workplace, which collects billions of {dollars} in taxes and costs from roughly 90,000 companies annually.
Town’s growing old enterprise tax platform was thought-about a vital undertaking as a result of the prevailing system was approaching the tip of its helpful life. Now, metropolis officers say they’ll want to start out the method over from scratch.
A whistleblower grievance alleged Shah didn’t disclose her shut friendship with Versace and improperly concerned herself in selections that helped Mechanical Orchard safe a bonus over opponents. The grievance additionally raised considerations about Shah’s niece acquiring employment related to the corporate’s company community in the course of the procurement course of.
Greater than 1,100 emails and inner information revealed in depth communications between Shah, Versace and different firm executives earlier than the contract award. One February 2023 e mail confirmed Shah making an attempt to attach Mechanical Orchard with one other metropolis division.
“My pal and I have been chatting concerning the firm that he simply joined,” Shah wrote whereas introducing Versace and the corporate to officers within the metropolis‘s Assessor-Recorder’s Workplace.
The audit concluded Shah ought to have disclosed these relationships and eliminated herself from selections involving the corporate.
San Francisco Mayor Daniel Lurie has positioned an emphasis on modernizing town’s growing old expertise infrastructure. His workplace didn’t instantly reply to a request for remark Tuesday.
The whistleblower additionally alleged Shah helped alter the procurement course of in ways in which favored Mechanical Orchard. Inside metropolis information confirmed that last-minute changes to value calculations added roughly $1.7 million to competing proposals whereas leaving Mechanical Orchard’s bid largely unaffected.
Though Mechanical Orchard in the end received the competitors, the contract by no means moved ahead.
The corporate abruptly walked away from the deal in September 2025 after The Customary started asking questions concerning the allegations and requesting interviews with firm executives. The identical week, Shah was positioned on paid depart as metropolis officers launched investigations.
On the time, Cisneros acknowledged the collapse of the contract represented a significant setback for efforts to modernize town’s enterprise tax operations however pledged to resolve what occurred.
Investigators discovered proof that Shah exercised improper affect over the contracting course of and didn’t uphold requirements designed to make sure honest competitors for taxpayer-funded contracts.
“Shah understated her position and involvement within the course of TTX used to pick out Mechanical Orchard to exchange the enterprise tax system,” auditors wrote. “In truth, she directed employees to control the method so
Mechanical Orchard would get the $7 million contract.”
Ethics consultants who reviewed the unique allegations described the conduct as extraordinary and warned that even the looks of undisclosed conflicts can erode public belief in authorities.
