chairperson avalos: good morning and welcome to the budget and finance committee. i am joined by supervisor mirkarimi and supervisor elsbernd. will be joined soon by supervisor campos. i would like to excuse supervisor maxwell. she is excused. do we have any announcements? >> all persons attending this meeting are requested to turn of cell phones and pagers. if you wish to present any documents to the committee, provide a copy to the clerk for inclusion. if you wish to speak during public comment, please fill out the speaker card. actions will appear on the agenda august 3, 2010 unless otherwise stated.

chairperson avalos: please call item one. >> item 1, resolution approving the third amendment of the agreement between the city and western states oil, increasing the total not to exceed amount of the contract from $25 million to $50 million and extending the term for one year, pursuant to charter section 9.118. >> naiomi kelly, said the purchaser. we want to increase the contract from $25 million to $50 million. this field contract is to support gasoline, diesel, and biodiesel for the city fleet and pieces of equipment including buses, fire trucks, ambulances, police vehicles, and other equipment to back up the

hospital. the fuel contract is the result of a low bid competitive solicitation for a 1 year contract with four 1-year options to extend. the price is fixed for the term of the agreement including overhead and delivery of fuel costs. we concur with the budget analyst recommendation. if you have any questions, i am here. chairperson avalos: mr. rose, share with us your report, please. >> the only thing i would add is i do want to call to your attention on page 5 of our report that this "not to exceed amount" increase includes a contingency, but i think the contingency is well explained. i do recommend approval of this resolution. as you know, this contract was competitively bid last year and

includes four options. this is the first option. chairperson avalos: very good. if there are no questions or comments, we will have public comment. public comment is open for item one. seeing none, i will close public comment. a motion to approve from supervisor mirkarimi, seconded by supervisor elsbernd. moved to the board with a recommendation for approval. madam clerk, if you could please call -- we are waiting for supervisor campos for item 2, so let us go to item three, please. >> item 3, resolution authorizing the director of public health and the director of the office of contract administration/purchaser to contract with the san francisco community health authority to provide a provider payment

services for the help the san francisco -- for the healthy san francisco program. >> this one-year contract is with the san francisco community health authority to provide payment or reimbursement to non- department providers who are critical to the overall operation of the healthy san francisco program. it was conceived as a partnership and we believe it is important for community-based organizations to deliver services to this population. we of contracted with them in the past. the body of work for this continues. there is a current effort to ensure access to care. we concur with the recommendation of the budget analyst. chairperson avalos: very good.

let's hear from mr. rose. >> mr. chairman, on page 6 of our report we point out that this contract was originally awarded on a sole-source basis to the san francisco community health authority. it has never been competitively bid. the department does explain why we concur with the department. we know that they are a separate -- that this agency, sfcha, is separate and distinct from the city and county of san francisco and as such has not been subject to any independent oversight by either the board of supervisors or the controller. i did speak personally about this matter with members of the comptroller -- of the controller's office.

this contract is simply hanging out there, from the standpoint that the board of supervisors has not seen the details of this, nor has the controller. this is retroactive to july 1, for the reasons explained on page 6 of our report. bottom line is we recommend you refer the resolution but we also recommend the controller consider performing a review of the fiscal condition of the san francisco community health authority. we suggest that with no suggestion there is anything wrong at all with this organization, but simply that it never does get an independent review before the controller. chairperson avalos: thank you, mr. rose. i am just kind of wondering what other similar authorities that we have that have a similar relationship with the city and county of san francisco. i know we have our ihs

authority. is that contract? is that rfp? >> i cannot speak to other authorities, but let me give you some additional context for the san francisco community health authority. the authority was created by the city and county of san francisco back in 1994 as a statewide effort to move toward a managed care system. there are 12 other authorities in the state of california, all based on state legislation. as a health and maintenance organization, which is what the health authority is, it is regulated and licensed by the state department of managed health care. part of that requirement, because it is a health plan, is the ongoing review of financial stability and liability and integrity of the organization. so on a monthly, quarterly, an

annual basis, all financial statements of the authority are submitted to the state for review. all of those various financial reports are put on the state's website so that individuals can have an opportunity to look at the financial integrity and soundness of the health plan that delivers service. so while it is true that the board of supervisors and the controller's office has not done that review, the state of california understands the importance of making sure there are financially sound hmos. so that review is on the state level. we are happy to support any controller office review. >> mr. chairman, just as a follow up in connection with your question, you had mentioned the example of ihss. there, we report to you and we

lay out all the details of that contract. it is a detailed examination. not so in this case. that would be a difference. chairperson avalos: just in relationship to the state function of doing that financial oversight for the authority, i imagine the state does that because there are state funds that go into the authority. but we also have local funds that go in. does that fact give us an additional need to have oversight from the controller's office and board of supervisors? the state is probably looking at the whole thing. is it because there are state funds coming in? could we need a local oversight function as well in san francisco? >> the state function is in respective of the funding source that is used to provide services. as a health maintenance organization -- california is

the only state that has an organization such as the department of managed health care. it reviews every health plan, their respective of whether it is state dollars, local dollars, or private funding. that is its responsibility. in terms of the oversight of the san francisco community health authority, it is a 19 member board. 14 of its members are appointed by the board of supervisors. it goes through that process on an annual basis. the additional five members of the board are designated positions. there is someone from the health commission, the department of public health, ucss, the department of mental health, and the board of supervisors. so there is significant oversight in terms of the actual appointment of the governing body of the san francisco health plan, which is responsible for ensuring the financial stability, fiduciary role,

oversight of the organization to insure it not only meets its financial obligations but it's a service obligations. chairperson avalos: may be a question to the controller's office about the recommendation from the budget analyst on reviewing the fiscal condition of the authority. what do you see is the need or importance for that, in terms of your role as controller? >> through the chair, from the controller's office, because this is a contractor of the city and county, we have access in terms of auditing. i corresponded with dr. katz about this issue yesterday and what he offered was that there are financial statement audits that are done on an annual basis. those are shared with the board of directors. because the information speaks to the rates and how those rates

are derived and so forth, that information is done in closed session. but he would be willing to share those financial statements with us in the controller's office if there was a need based on that. he is in agreement that a financial review could be performed. it has not come up on our risk management protocols at this point. we do have a risk management analysis that is done. we have an intent and a goal to audit all the functions every six to seven years. there are non-profit contracts and other contracts on that list that have some other risk or some changes, or some unusual growth, or some issues with their boards of directors or the service delivery, that would rise to the top of the audit list. this one we have not heard either from the department or

from clients or patients of the hmo that there are any issues. if the board of supervisors believes this is something we should do we can put it on our plan for this coming year. however, it has not risen to a point of there being undue risk. we will certainly take a look at the financial statements for the last three years and see if there is anything unusual. duncan katz said there were no reported conditions. that is usually an indication that their systems are adequate based on generally accepted accounting. chairperson avalos: colleagues, if there are no other comments or questions, we can go on to public comment. public comment is open for item three. seeing none, we will close public comment. motion to accept and approve with recommendations? taken without objection. very good.

thank you, colleagues. madam clerk, please call item 2. >> item 2, resolution declaring the intention of the board of supervisors to renew the 2500 block of mission street business improvement district, to be known as the "mission miracle mile business improvement district" and to levy a multi- your assessment. supervisor campos: thank you colleagues for your indulgence on this item. this is a resolution that i have introduced asking the board of supervisors to declare its intention to renew the property- based 2500 block of mission street, a business improvement district to be known as the "mission miracle mile business improvement district." essentially, we are asking to renew that business improvement

district. let me make a couple points about this item. san francisco is fortunate that we have throughout the city partnerships between the city and local communities, to what is called the community benefits district. that essentially helps to improve the overall quality of life in certain communities and targeted commercial districts in mixed-use neighborhood. when voters establish a community benefits district, local property owners are levied a special assessment to fund improvements to their neighborhood. the funds are then administered by a nonprofit organization established by the neighborhood for the purposes of improving their community. it is important to note that while our city departments continue to use -- continue to provide the same level of services within a community benefits district that they provide in other parts of the

district, the community benefits district provides other additional services, an additional level of maintenance and improvement. that is why we are asking for renewal of this community benefits district. the mission miracle mile business improvement district, which is located on the boundaries of mission street between 21st and 22nd street is one of these community benefits districts i am talking about. since it began in 2005, the improvement district has been focused on a number of things including beautification, cleaning, maintenance, public safety, and greening projects. this asks the board of supervisors to approve the renewal of this special assessment district for the next five years. its 2011 budget is set at $85,000. to provide more information if i

may, i would like to through the chair call mr. phil lesser, who is the chair of the district, to say a few words. thank you for the work you have been doing. >> thank you very much for sponsoring this reauthorization of the business improvement district. it is the heart of the mission miracle mile. it is between 21st and 22nd. if i may show a couple of pictures -- the supervisor completely articulated what we are doing. it does not really show it completely, but before we formed the business improvement district that is what the block would look like. this is what it looks like today. that is the removal of debris twice a day. but on top of that, when people say, "where is that block," i do

not have to say the block on 2500 anymore. i can just say the block with all the chloral baskets. everyone knows it now. people who stand on the street now realize they have surveillance cameras. they no longer stand on that street. it is a safe, clean, green some stretch of mission street. we hope to one day come back and as you for authorization to stretch this all down the miracle mile. supervisor campos: thank you. let me say that in these tough financial times for city resources are limited i think we have to think of ways of creating these partnerships. i am proud to be the sponsor of this extension. colleagues, if you have any questions we also have from the mayor's office of economic and work-force development lisa

pagin, in the event you have any questions. i would without prolonging this simply ask for your support of this item. chairperson avalos: if there are no further questions, why don't we go to public comment. seeing non-, public comment is closed. -- seeing none, public comment is closed. supervisor elsbernd moves this passed to the board of supervisors. next item, please. >> item 4, authoress in -- authorization to the mayor's office of housing to expand soma community stabilization fund dollars under certain conditions in the amount of $2,762,000.

>> i am with the mayor's office of housing assigned to the agency. i request the committee recommend the full board approve this resolution to extend approximately $2.75 million to subsidize the development of onside affordable rental housing use its -- housing units at 333 harrison street. i have submitted an amendment makes changes to the resolution from the july 3 meeting. i will read those after representation. the project at 333 harrison is a new project which would generate approximately $3.20 million in soma community stabilization fees, a fee established in 2005 as an amendment to the planning

code for mitigation of the impact of residential development in the area. the fund must be used to addressed various impact of development and can be used for affordable housing, economic and work-force development, community cohesion, and approve meant -- improvement to infrastructure of the neighborhood. there was a committee founded to make recommendations to the sport on the expenditure of money deposited in the fund. we were before this committee earlier this year with the first round of expenditures from the fund. we just completed grand negotiation and the first contracts -- grant negotiation and the first contracts are starting july 1. these are mostly in the form of grants to community organizations. harrison fremont, which is managed by the emerald fund, approached us to consider recommending that some of the

funds generated by this project be targeted toward deeper affordability at the site. the proposed 49 units are rental and will be made available at 30% chairperson avaloami. they represent 15% of housing at the site. we voted unanimously to support this project and direct approximately $2.70 million of the fees to support the affordability. the remaining $450,000 of the fees will remain in the fund and be released by the mayor's office of housing through the legislative process. and we understand the some fund -- we understand the soma fund is to benefit the area. the city bylaws prevent us from

favorable or targeted community housing, so it requires additional benefits from the developer which will see outlined in the larger resolution. i will call my colleague up after i read these revisions. i think you all have copies. the revisions began on page 2. -- begin on page 2. would you like me to read the whole thing? chairperson avalos: just the revisions is fine. >> at the bottom of page two, we are adding a consideration of the housing unit, not subject to the rent control act. employ at least 30% soma residents for all end-use jobs for the project. have an objective but not a

binding requirement to hire 50% of entry-level construction and non-construction jobs from the local community, with first priority being given to individuals who are rent- assisted residents or who are living within soma. support local hire, the purpose of which is to benefit employers in the project by providing a pool of job at it quits -- of job applicants whose needs have been tailored to the employers in the project to a non- exclusive referral system. work with the city administrator and notified it of any entry-level job postings. hire a general contractor who has developed an understanding of how to meet and report on local hiring. deposit $100,000 within seven days after approval of this resolution and $150,000 within seven months after issuance of the project if first certificate of occupancy in the northeast

credit union, allowing it to provide more loans to soma residents and small businesses. meet with the soma cac regularly, at least quarterly, between approval of this resolution and issuance of the first of the kit of occupancy. notify the soma cac of job opportunities at all projects, including the emerald fund, to facilitate job placement. provide quarterly reports on local higher numbers as well as outreach efforts to soma residence for placement in jobs and units at the project. whereas notwithstanding anything in this resolution to the contract i, the parties agree tt

mo should have the right to make changes to local hiring requirements without the approval of the contract sponsor. those are the revisions. i would like to call up connie ford, who is the vice chair of the cac. >> supervisors, connie ford, vice chair of the soma stabilization. our chair works for the city of oakland and was called out to a special meeting, so here i am. this has been an exciting process for the committee. there are seven of us. we were approached by the emerald fund as their project was pursued. we are actually very excited about the resolutions that we have come up with, the idea of