the law says. our instructions are multi- lingual. supervisor chu: thank you. supervisor avalos? supervisor avalos: thank you. thank you for your presentation. just a question, there was a session earlier this year about making investments in credit unions and smaller financial institutions here locally, and wondering how that is proceeding in terms of projects moving forward and how that might impact our working to bolster the economy. >> absolutely. as we discussed previously, we managed the city's portfolio of investments. that averages between $4,000,000,000.705032704 dollars at any given time. when in that -- between $4 billion and $5 billion at any

given time. earlier this year, we went out with an informational invitation to all financial institutions, including credit unions, asking them if they would be interested in receiving a deposit of up to the fdic-insured limit. at this time, we're still processing the responses we have got in. i think we have made three, four -- five deposits in financial institutions. a number of them at credit unions -- 1 credit union has responded. we're still in the process of receiving applications. i would be happy to update you as we get more. we have published those deposits monthly in our investment report. supervisor avalos: is there anything those deposits are hoping to leverage in terms of

investments they're making locally that we can point to? >> we cannot put strings on those deposits. we encourage them in our invitations to use this money to be responsive to the community. i'm excited that the credit unions, that is really what they do. my hope is to get more of the credit unions to take advantage of it. four small credit union come a deposit of this size would help the more significantly than will help a major bank. it could make a bigger difference in the amount of funds they have available. i would be happy to keep you updated. supervisor chu: thank you very much. on the recommendations, the two investigator positions, and the accountant, are there any areas of agreement? >> we are still in discussion. we have had good progress. discussions are still under way. supervisor chu: thank you. with regards to the two additional positions for investigators, i would like some more information about why it is needed.

it to be helpful as we go for deliberation. >> absolutely. >> madam chair, are reductions total 503,000, to hundred $30 --$503,230. these are general fund savings. they allow an increase of 2.2%, $632,000. our recommended reductions totaled $117,000 their ongoing savings. those are general fund savings. we are still working with the department. we will report back next week. supervisor chu: thank you. i want to thank the treasurer -- treasury tax collector. we will see you next week. our next department is the comptroller's office.

-- controller's office. >> thank you. i will be very brief. i will run through some of the highlights of the two-year budget. the committee is aware. you have on the overhead projector. our office provides a host of financial management supports -- services for the city. we audit and provide technical assistance for city departments. we perform the kind of budget and economic analysis that you see typically during the budget process. our budget for the coming two years is growing modestly at just about 3% in each year.

$38.9 million next year. almost exactly 3% per year, as is the case with the citywide budget, predominantly driven by the employee wage and benefit costs, offset by reductions and other changes we have made to pull down our subsidy and expenses. our position count is roughly flat, declining from 201 fte's down to 198. supervisor chu: can i ask you to hold on? ok. go ahead. >> just to very briefly -- are balancing plan for this budget totaling $2.1 million over the two years is really made up of a host of different solutions that you have in the proposed budget before you. $220,000. slowing down the work we're doing in the auditor function,

which generates a balance we are using to reduce their need for general fund money the year after. then other miscellaneous productions and work order recoveries. that is repeated each of the two years. very briefly, to hit some of the highlights of our work plan for the coming year, we are very excited to be nearing the end of phase one of the project. this is the city's replacement of the 20-plus year payroll system it will be an integrated payroll system merging with the human resources systems on one platform. we do expect that there are

subsequent phases to the project that will be stretching through the coming fiscal year. we expect to hit that milestone early in the year and push ahead with the others as it rolls along. as we finish one system replacement project, we are actively planning for the of the large one, replacing the city's financial management system. this is a very old mainframe- based system the city uses to conduct its purchasing business. we are anticipating completing the work on this project at the end of fiscal year ahead. this will probably be a multi- tier system need for the city as a whole. we look forward to being back with you to talk about the results of the assessment when we have completed it. third on our list, we're actively working to develop redundancies for our financial management in the event of an earthquake or national disaster.

we talk a lot about the first 72 hours after a major disaster, but the time beyond that really relies increasingly on us being able to use our technology tools effectively to continue to operate the government. we do have money in the coming year's budget available to develop an alternate site that will let us mirror our current financial management system to an alternate location in more real time to allow us to bring the city's financial operations up faster after an event. we talked a fair amount today about the new budget set up of the new redevelopment agency, but a lot of work still has to be completed to integrate the former agency into the city's financial operations. as a reminder, this is an agency that was operating outside of the city's financial system using a different payroll system in different collective

bargaining units, using different contract in roles. bringing it into the city family in rules and procedures is probably going to be an effort that takes the full year ahead, and we will pursue a lot of time from our staff as well as the city administrator staff and bring that ahead. we are looking for to implementing an open checkbook initiative this year, which will provide the public with improved access to public and searchable information regarding the city's spending and budget information. we have some of this available on our website that lets a member of the public look up a given department contract and see how much we're spending on a certain vendor or on a given service. we are hoping to broaden that into a broader sense of searchable information that will give the public more insight into how their tax dollars are spent. we are looking forward to pushing ahead with that this coming year and developing some of the key components of that project.

we have a list of other things going on everywhere else. i will not try to talk through all of them. we have about 150 other audits and projects we're hoping to get completed, from the very big to the very small across a whole host of financial and management issues. in terms of the committee's questions, regarding job creation, we have kind of our macro large role and our micro small department role to play here. on the larger front, we have been working actively for the last nine months on potential replacement for the tax system. those are pending before the board of supervisors. those are changes that we think have potential to move the city to a more stable, economically efficient tax system in the future. that is probably the single largest contribution we are making to this specific point

both in the current year and looking ahead to the future. in terms of our work as a department, we are participating in youth works. we manage the city's accounting family. the accountants come through processes administered by the comptroller's office. -- controller's office. over half of the participants in the program to come from local colleges and schools. getting them in the door, getting them into the accounting family, there is a ladder from there for the city's accountants where they grow. at this point, i think the vast majority of the senior accountants came in at the entry level through this program and kind of have grown up through

the program. this is probably the single best thing we can do in terms of local hire andyouth opportunity that is under our direct control. again, we use public service aid to hire others on a periodic basis throughout the year for short-term assignments. language access, we are a tier two language access department. unlike many of the departments you have had here today, the largest public use we have in the office is in the claims unit. these are individuals filing claims against the city. we take them and we work with the city's attorney's office to begin the process. all of our claims and information at that point is available in a number of languages, including english, spanish, chinese, vietnamese,

and russian. the complaint forms involve allegations of non-treatment under the ordinance. they're available in multiple languages. we do have key documents that we produce that we make available in multiple languages, including a guide to the san francisco spending process, a booklet we have available to the prop republic to understand how our process works. we provided in multiple languages. we do make use of language line services. we don't have bilingual staff available to cover a given need. we do have a number of bilingual staff in the controller's office, mandarin and spanish being the majority of people that are available for the

public to speak with. i would be happy to answer any questions. supervisor chu: just a question on the status of the budget analyst recommendation. >> apologies. we continue to work with the budget analysts. we are not yet in agreement. we look forward to working together during the week ahead. we can report to you next week on our progress. supervisor chu: thank you. >> our recommended reductions total $693,860 and $455,000 are ongoing. $230,000 are one-time savings. these recommendations would allow an increase of $35,000, 1/10 of 1%. those are general fund savings. are recommended reductions total $516,000.

it would allow for an increase of over $1 million. the recommendations will result in five under $16,425 in general fund savings -- $516,425. supervisor chu: think government. will you be speaking to the general responsibility item? can you speak to item 11, adjusting the tax with the consumer price index? >> i will address the general city responsibility. this is a part of the city budget that contains funds that are citywide in nature and not specifically allocated to a department. this department contains debt service funds as well as the mou

reserve, litigation reserve, the general fund reserve, and other reserves we have in the city. the budget analysts, we have been working on a list of budgets and we have made a recommendation to reduce the audit adjustment reserves to $5 million. we are not in agreement, but we will work with the budget analyst over the coming weeks. supervisor chu: thank you very much. quick question. with regards to the piece of legislation that we just passed, the question to the mayor's budget office, there is a item that we passed the full board of supervisors, and i'm wondering where that would reside at the moment. it is not in the budget. i am wondering if this would be the place where that would go. >> the -- that piece of

legislation would impact the city's revenue. that comes into the budget and then gets distributed as general fund. if that legislation were to be approved, and if the programmer to be funded, we would effectively reduce our revenue by an estimated $2 million. supervisor chu: it gets reduced -- >> yes. supervisor chu: thank you. with regard to the budget analysts recommendation?

this is an allowance under the initiative. and the budget is assumed before you. >> madam chair, eyes -- i fail

to mention the control, which is $6,653, and that is ongoing savings that would allow an increase in the budgets department of the 6%. >> if there are no questions from the committee at this time, let's move on supervisor avalos. >> i'm not sure if my staff had contacted the control office about the small-business exemption that we preliminarily passed last tuesday. it does show a hole in the budget of two million dollars and i think it would be important to consider within the context of the budget and last week we approved it without an improvement in the budget.

it did not seem to go anywhere. as we are looking added, and having a discussion about the decision that we made last week, about whether we want to put a two million-dollar hole into the budget, that means we have to restore $2 million before we want to do any kind of restoration to the budget. if there are questions as to whether we can do something to the advent codes for the budget that can remake that decision about whether we can approve that type of exemption in the budget, because i would like that to be part of it. >> you are correct in that it is not assumed in the budget before you. it is equivalent to $1.5 million

each year of the budget. it is close to two $0.5 million in the second year. i would assume that once you vote to reduce the tax that it cannot be increased by subsequent board issue. what is approved will likely be what is finally approved for the next four years.

>> we have the loan fund, which is linked to job creation. but we have the full loan amount and that is also associated with the job creation. that would have an exemption for small businesses recovering a lot of that lost revenue that will have them paying a little bit more. tomorrow i will try to have another effort to not have it approved. maybe we can continue the item to another day when we have a better sense of what the budget is going to look like we would not want to put ourselves in the hole before we even start making restoration's moving forward. >> thank you, supervisor avalos. i think the way the legislation

is made is that if one form or another does end up coming to be, then the exemption for the small business is exempt. i do not believe there is a conflict between whether or not voters pass something that is moved forward in november. if there are no further questions from the committee at this time, why do we move onto the city administrator. >> good afternoon, supervisors. i'm the city administrator and i'm here to propose the fiscal year 2012-13 and 2013-14 budget.

the general services agency oversees the department of technology, the department of public works, the ethnic services department and the city administrator's office. i will just talk about the city administrative services office today as he will get presentations from the department of technology and the department of public works later on. i want to go over quickly -- exxon quickly as i can the -- as quickly as i can with these departments over the next few years. the budgets are basically static because of the rising health- care costs. particularly our finance functions have gone through a major change this year. we have merge those luncheons with the city administrator's office and the department of

technology. -- of those functions with the city administrator's office and the department of technology. as you heard earlier, we have over on the left-hand part of the chart, the community tv division following the do -- the redevelopment merge from the hearing earlier today about that. they have an increase in their facilities renewal budget about $1.2 million. the medical examiner's office has been mandated by state law to examine certain types of debt. their budget is increasing -- decreasing by $6 million because they are just finishing capital

plant in the halls of justice. we had planned to come before you sometime in the next few years with a proposal for the earthquake emergency response fund, too. and we plan to acquire one new wall street's as a site for the medical examiner to relocate out of a hall of justice. that is something that we are looking for in the future. we also have the convention facilities department. they are finishing a $56 million facelift renovation of mosconi north and south with the new bathrooms, carpeting, paint and lighting. as a result of the renovations, we're in the process of restructuring the debt. there is an increase in conventions facility budget for

both fiscal years 2012-13 and in 2013-14. there's the city administrator program. the community challenge is met, formally known as the communication fund. this provides matching grants to local residences, nonprofits and organizations to make improvements to the neighborhood. there was an increase in the money sitting for the business tax. our budget will include $800,000 a year for a total of $1.8 million. the budget is decreasing by about $500,000 for the office of disability due to changes of priority. there will be legislation before you today that proposes a new plan for the mayor's office of

disability plan review foresight kick -- for a site construction and new construction. the office of labor standards and enforcement, a slight increase due to increased costs of installation contracts, which is an automated government contract that is payroll, management, and more. the majority of the budget is the purchase of insurance premiums. which risk-management there is a transfer of function of the jury bond program from the human rights commission. it is about a $1.8 million transfer function. there's the 311 call center, which their budget is pretty stable. but there are increases due to health care costs. justice, there is an increase in

that budget of $338,000 due to the purchase of a da case management system migrating to the justice hardware. there is an earthquake safety and the mentation program, which has evolved out of the community action plan and began in fiscal year 2011-12 for a program to implement education for earthquake management prepared in this next fiscal year -- for earthquake management. in its next fiscal year, we propose to hire a manager for this program. that is an increase of four hundred $40,000 --