consumer protection unit. finally, for supervisor kim, in terms of the contractual services, that level of information. >> we can get all of that. supervisor chu: colleagues, why don't we take a quick 30-minute recess? supervisor chu: we're back to the budget and finance expanded committee. but just come back from recess and finished introduction for budget and city attorneys budget. colleagues, if we can resend the previous action we took, the motion to accept a budget analyst recommendations on page 65. upon further conversation, he wanted to work through a few more of those items and, so can we send that motion?

without objection. why don't we continue with the office of economic and workforce to about? >> i was just at the beginning of my presentation, looking over the comparison of the current fiscal year budget and the next two years of budget. i was listening to the budget presentation and i understand there are some threshold questions the committee has with regards to internships and i thought i would refer to those now for my department. the office of economic and workforce development currently has 19 intern's the summer. they're mostly undergraduates but we have had some high-school students. just as the city attorney

mentioned, we have in turn to all year round but tend to get a bubble in the summer and average about 6 to 10 and turned all year. department wide, including the office of small business and film, we have about $900,000 in professional service contracts. if you would like a breakdown of that, i can provide it later in the hearing more next week. getting back to the core of my budget presentation, if i could have the overhead. the budget is supposed to increase in 2012-2013 and 2013- 2014, though in the second year it does increase. an addition of seven new

positions related to economic development positions and three positions related to work-force development and to federal workforce grants totaling $3.5 million and the extension of the rebate program recently approved by the board of supervisors and signed by the mayor. the decrease in our second year is primarily attributed to the removal of the $4.9 million for the cruise ship terminal projects and the removal of the work force development grants which takes out the $3.5 million. they can be broken down thusly. to for the jobs, three for the invest in never its initiative, one for manufacturing, a manufacturing sector manager, one for a private-public partnership position assisting

with large capital projects and an additional half time position for economic development related to my life. one of the budget hearing request made by supervisor carmen chu -- due to some administrative problems, our language access issue is not submitted to the department and we wanted to provide you with this high level overview. we serve a range of business owners and employees with 14 bilingual staff in contact position to speak spanish and chinese, both manned and cantonese. our largest direct service is the office of work-force development. office of small business has a total number of clients with limited english proficiency --

proficiency -- the total number of clients is 2014 and 266 are clients of limited english proficiency. we think that number does not accurately represent a small businesses out there with owners with limited english proficiency and we think the jobs proposal will help us reach those businesses much more effectively. i will get into that program later in my presentation. with regard to the work force, they have served 2709 individuals as of april 30. 657 are of limited english proficiency, about 24%. with regard to work force, the budget is projected to grow in fiscal year 2012-2013. that is largely due to federal grants. there are three department of

labor grant initiatives we are currently working on. one is a technical training grant, a disability program and an enhanced job demonstration project. this together total about $10 million. ongoing programs include our job readiness service and the ongoing projects serve about 4000 residents per year and 8000 youth, about 2000 job placements and the director of the workforce development is here to elaborate on anything you like to inquire about regarding work force. with regard to the film budget, the overall production has increased by about 3% since last year. we have seen the number of -- the number that has applied for

the rebate program has grown significantly. there were only three feature films between 2006 and 200010 that applied for and received their rebates. we saw three feature films apply in two years between 2010 and 2012 at just in 2012 we have had brief elms apply for the rebate. it has been funded to 7000 -- $700,000, an increase over what was previously available what we think it will spur the growth of this industry throughout the city. the film commission established the sf film collective. one of the main goals of the film commission next year is to work with local unions to promote san francisco as a film friendly and affordable place to film.

the increases you see in the budget are due to the increased revenues we're receiving from permit fees as well as automatic increases in personnel. the major development projects we are working on in the next two fiscal years is quite extensive. these are large, and packed full projects that hold a significant value to the public. we will be working on cpmc, which will move forward, the proposed warriors are arena, the sea wall lot development, commonly known as a giant parking lot a. the america's cup and implementation, continuing to work on the octavia boulevard land sales and the old chronicle

building at fifth and mission. i have milestones i can't go through -- i can go through with any of those projects. with regards to economic business development, despite a still struggling economy, we had a great number of successes in retainer -- retaining major employers and ensuring job growth stays in san francisco. we were able to retain and accommodate the growth of a significant number of companies and attract impact will new ones. our goals for fiscal year 12-14 are to continue these efforts, going on-line, allowing for easier implementation and obtain tax credits. for the purpose of the budget, we will be launching and manufacturing initiative which would create a manufacturing

desk in the city and work with manufacturing businesses that need assistance navigating the city's approval process these. that will help san francisco resident get connected to manufacturing jobs and promote made in san francisco items. we propose focusing on fashion design, food and beverage, all sorts of consumer products, as well as small scale prototyping manufacturing we see happening in the city. we will be working with the airport to expand our international program and strengthen the international business recruitment. china has been very successful on a very modest grant provided for the city to a nonprofit attractive chinese-based businesses and technology exchange. we would like to expand that

model and work with the airport and continue to find ways to attract international investment. supervisor chu: where is that the zone, generally? >> in the eastern part of the city. is determined by census tract that had a certain amount of poverty or unemployment that has criteria established by the state and you are allowed to add a certain amount of adjoining districts to ones that have underserved populations and it is largely the eastern half of the city. >> we have a lot of people to participate in the program? >> to date, the total number of businesses that have taken advantage of the program is 1222, 25% decrease from last year. we can only attribute that to the slow economy and businesses

being less aggressive about hiring. we have also had in the last three years massive outreach on this program, so we think we have reached a saturation point for those businesses that were previously unaware of it. it's a program that allows you to retroactively get state income tax credits. once businesses are aware, they can look back and see if the have qualified expenditures or qualified hires. it is just anecdotal but we think we have reached a lot of businesses that we may see a smaller number as new businesses are eligible. with regards to america's cup, we have a proposed budget next year of $10 million, down from a 12 million we had originally budgeted this year. that number is proving to be in excess of what is needed to

cover the america's cup city costs. when the board of supervisors was discussing the americas cup project in march, we do the budget was down to $10.9 million. costs are now projected to come in below $8.5 billion. next year we will be focused on implementing the america's cup at hosting events in august and october at we have executed a mou. our initial reimbursement is targeted before june 30 that we will be reimbursed a quarterly basis. mike martin is your view of further questions. supervisor avalos: on the

question of how they are beating the june 30 funding deadline -- >> i'm the america's cup director -- we have had several meetings of the course of june to go over are expected expenditures by june 30. they are fully expected to pay all of those costs at a lower number we saw that during our march urines and we will be executing that payment, basically everything through june 1 will, june 30 and then there will be 30 days and the final invoice to make the remaining payments. there'll be additional time to make that payment. supervisor avalos: i do recall the 8.5 million figures -- do you recall? >> there were a mixture of pledges and money received

ino's the -- money received. i know they have been pushing out in time the board hearings. supervisor avalos: hitting that target? when are we going to hit that? >> might understanding is they will hit the 12 million. that memorandum of understanding is to by the 12th of june showing their id -- ready to pay for their embarrassment's going forward. supervisor avalos: thank you. >> moving forward to small business -- the office of small business has served 2500 clients as of the end of may and is expected to ebb and with a

number of clients served a year over year by 3%. a of increase the number of workshops by 30% and the office of small-business is actively doing our reach, averaging more than one workshop for week at this year, they have highlighted compliance the zone benefits and they have three workshops of mobile food facilities. the goals for next year include the small business commission meeting twice a month rather than once a month as well as returning to full counter service hours. they have been open monday through thursday but next year, they expect to be fully open 8:00 to 5:00 monday through friday. they will engage in an analysis of their services and programs.

the office of budget of dallas's four years old. analysis of the client data, we have a lot of good data but we think now is the type to do an assessment to understand how impactful the office has been. the office is not entrenched in a lot of long term practices of there are changes to be made, this is a good year to do it. they are also going to launch a launching and licensing permitting portal the race of navigation system. it's the holy grail of where we're headed. we would like businesses to do as much of the permitting as necessary -- as much of the permitting as possible online. what we are starting with is something much more modest, a comprehensive and definitive list of what is needed based on business type and a schedule of

how you should tackle those. the case management assistance is always available the office of management assistance. the bulk of the proposed a distance -- proposed additions fall in the neighborhood development division. the neighborhood development division was very active in this past year. they were able to make 31 loan that create 83 jobs with just eight that rebels dollars -- $800,000. we opened a grocery store at several small businesses that have served as catalysts on third street and there are now weekly events happening and we continue the third street corridor business attraction at retention program. on that central market, the table tax and it has resorted

it 450,000 square feet of new leases being signed. in the eight neighborhoods -- in eight of the new red districts we work in that participated marketplace initiative, they can see rates went down in a struggling economy and we take that to to the lark -- to the attention of our managers at the good works being done by stakeholders. that new initiatives -- supervisor avalos: on that -- supervisor chu: i have been out in my neighborhood and that we have done that in partnership and have done a few merchant walks already. as we talk to some of the businesses, there were a few that did not know about program and were excited about it and it's good we were able to get the information out there.

there were also a few that were struggling and perhaps behind on payments already but they were starting to finally turn back into the black hat outstanding debt that was still too, not all of their account balances were current. the way the revolving loan fund is structured is it is geared toward businesses in good financial shape. has the department bought about any kinds of programs that could fit those who may be behind on a few payments but have a good business plan going forward at a strong business plan because we see that as a gap we are not able to fit. they don't necessarily qualify for the revolving loan funds and they go to banks and banks are not willing to fund them. can you express some thoughts on that? >> yes. it is concerns like that that make us look alike -- that make us look at the mayor's proposal to augment money for business

loans in a more comprehensive than the broader fashion. the budget analyst did not have the benefit of getting this information and type for this hearing, but we will work of the descriptions i am about to provide to you. what we are about to do with the $4 million of loan funds the mayor has proposed to fund us over the next few years is to create a spectrum of grant, forgivable loans, at long products that address exactly you are describing. we think there are some businesses that would be better suited to receiving grants for tenant and sought improvements and there are some that are best suited by receiving forgivable loans, which would be continuing to operate for three to five years at those loans are forgiven. there are some for him at the

other end of the spectrum, they have graduated out of a small revolving loan fund and the need monies over $50,000 a year to effectuate an effective expansion, renovation, or to buy more products or have more working capital. what we want to do is not fund the revolving loan program the recently approved a supplemental for any more with these bodies. we believe the money given to us this year can be spent, $500,000 in the next fiscal year and another $500,000 in the following fiscal year and that is adequate for that sort of market segment. i can describe in some detail exactly what we are proposing. supervisor chu: if you could share what is the plan for that

-- >> $2 million in year one and $2 million in year two. we would propose the loans and larger sizes than $50,000 and proposal -- $1.5 million in year one and 1.6 million in year two. for the forgivable loans, we would propose 75,000 because it would take a little time to give it up and running. 150,000 in year no. 2. grants that we would like to focus on ada assistance. we have heard there are businesses struggling to make 88 upgrades that are necessary to avoid lawsuits and meet other building code requirements. $425,000 in grant assistance and facades in the first year at

250,000 in the second year. supervisor chu: thank you. >> back to some of the new initiatives. the job squad is an initiative of the mayor's that is direct outreach for small businesses. the idea is these two full-time employees would be out in the neighborhood nearly every day assisting small businesses who are too busy or small to take a timeout to come to city hall to work out a problem. the idea is these folks would be highly trained to do outreach and education around assistance programs of all sorts, whether it is reviewing rates are tax benefits are department of environment assistance -- and

the thing this city has to offer, they would be educated on how to address a business's ability to address it. they would also be able to provide rapid assistance to neighborhoods detrimentally affected by various occurrences or, if you take valencia's street -- valencia's street for example, we have well-trained folks that could have gone out after the night of vandalism and assess what was needed and delivered city services effectively. these folks would also be able to identify and escalate bigger issues and served as a front line for identifying systematic issues small businesses are facing and bring them to policymakers. one issue we hear a great deal about as large charges for water and sewage hookups. that can often be a deal breaker for businesses trying to open. i spent a little time talking about the loans.

at understanding the needs of small businesses, we believe having access to funds to do ada improvement and in order to be able to afford certain types of improvements, we think grants or forgivable loans are a better route than having something be a loan payable back with interest. supervisor kim: i know that in the budget legislative analyst's report, there were questions about how much of the $1 million we appropriated at the end of march had wind it down. given the mayor is proposing an additional $2 million in small- business loan funds -- i think there is general consensus we want to strongly support this program and help our small businesses with low-interest loans, but the question is are there -- is there the capacity

to wind down a large amount of money given their staff resources, etc.? given what we have appropriated has been blown bell hand a little bit on their resources capacity of the organization to further wind down another $2 million this year? >> as i was discussing -- supervisor kim: i apologize if i repeated the question. >> that $1 million has not yet been deployed. half a million was put on reserve and half a million was given to us. of that, $380,000 -- there has been $380,000 worth of grants to small businesses approved by

working solutions. none of them have been funded because we have not got the money to them. that actually happened last week. there has been a lot of activity with screening at approving loans. the money should go out or in one day -- in one big tranch. with the other money that will be revolving, it should be enough for the next two fiscal years. what we would propose for the remaining $4 million in proposed budget for loans, we propose to be allocated much differently, to actually hit businesses across a larger spectrum, including grants for compliance construction work and tenant improvement and forgivable loan

for tenant improvements where a business stays in operation for between three and five-year spending of love. the other day this businesses that need loans larger than $50,000. we would look for community lenders for that program to find a lender that would hopefully leverage the money and add additional monies for something similar to a revolving door program. forgivable loans and grants, of we've worked with a nonprofit community partner to administer those funds. >> what an example of some that we would like to give funding for that is larger than $50,000? we are obviously not getting those out yet.